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NNPC Not Ready to Proceed with $2bn Crude-backed Loan – Kyari

GMD NNPCL, Mele Kyari
GCEO NNPC. Mele Kyari

The Nigerian National Petroleum Company Limited, on Wednesday, said it would make an formal announcement when ready to take the earlier reported $2bn crude-backed loan.

It was reported on Tuesday that NNPC was in talks for another oil-backed loan to boost its finances and allow investment in its business, according to the company’s Group Chief Executive Officer, Mele Kyari.

Sources familiar with the situation told Reuters that the oil firm aims to raise at least $2bn through the proposed new loan.

But when contacted on Wednesday to speak on the report, the Chief Corporate Communications Officer, NNPC, Olufemi Soneye, said the national oil firm would make an official announcement anytime the company is ready to proceed with the deal.

He noted that though the company would require funding to carry out its high capital-intensive operations, it would follow the laid down process to announce its financing arrangement.

“When we are ready to proceed with any of the initiatives mentioned, we will make an official announcement. As a global energy company, we need funding to undertake aggressive drilling campaigns. Naturally, we will require financing for our high capital expenditure projects.

“Our financing arrangements are typically announced through our financial advisers and arrangers. When the time comes, new financing transactions will be announced to the market,” Soneye stated in a brief response on the matter.

In August 2023, NNPC announced that it had secured a $3.3bn emergency crude oil repayment loan from the African Export-Import Bank.

When the $3.3bn loan is added to the newly proposed loan of $2bn, it means the national oil company is about to raise its crude-backed loans to $5.3bn.

According to Reuters report on Tuesday, Kyari said the company wanted the new loan against 30,000-35,000 barrels per day of crude production, though he declined to say how much money it sought.

Reuters also reported that NNPC’s debts to petrol suppliers had doubled in the last four months to hit $6bn. This was, however, countered by Soneye.

“False. Did they name the marketers they claim we supposedly owe? Let them name them,” Soneye had told our correspondent while responding to the Reuters report.

SOURCE: economicconfidential.com

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