NewStats: 3,261,481 , 8,174,120 topics. Date: Thursday, 29 May 2025 at 11:41 AM n1q1z

......As security

Nigeria will pay an interest of 11.85 percent per annum on the $3.3 billion “pre-export finance facility” (PxF) facilitated by the Nigerian National Petroleum Company (NNPC) Ltd and arranged by Afrexim Bank, TheCable can report.

Until now, the fine details of the transaction, which has a five-year tenor, had been withheld by all parties involved.

A similar cocoa-backed $800 million facility arranged for Ghana by its cocoa marketing board attracts an interest of 8 percent per annum.

Bilateral lenders, such as the International Monetary Fund (IMF), would typically charge 1-3 percent with a longer tenor.

In the details seen by TheCable, Nigeria pledged a total of 164.25 million barrels of crude oil — at 90,000 barrels per day — starting from 2024 to repay the loan through Project Gazelle Funding Ltd, an “orphan” special purpose vehicle (SPV) incorporated in Bahamas for the PxF.

Effectively, the NNPC has pledged 38.58 percent of five years’ worth of tax and royalty oil to secure the loan.

Nigeria pledges over $12 billion worth of oil
At the beginning of 2024, a barrel of Nigerian oil was sold at the international market at $77.93 per barrel, according to the Central Bank of Nigeria (CBN) data.

At $77.93 per barrel, the 164.25 million barrels of oil pledged by Nigeria equals $12.8 billion — about three times more than the facility taken.

Pre-2014, the national oil company used to remit an average of $3 billion from oil sales every month.

Officially, Project Gazelle Funding Ltd (PGFL) is the borrower while the NNPC is the “sponsor” and will pay with oil to the SPV to liquidate the loan.

To make the repayment, the NNPC will forward-sell 90,000 barrels per day of Nigeria’s share of offshore crude oil under the production sharing contract (PSCs) with the oil companies.

Under PSCs, the companies usually pay royalties and taxes by giving the oil equivalent to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Federal Inland Revenue Service (FIRS) respectively.

The NNPC in turn exports the oil on behalf of NUPRC and FIRS and remits the proceeds to the agencies.

This is part of the revenues paid into the federation and shared by the three tiers of government.

But under the PxF, the revenue from 90,000 barrels per day will be used to service the loan in the next five years.

The loan arrangers will get a commission of $66 million or 2% of the facility, TheCable further learnt.

Nigeria will pay 2 percent penalty per annum in the event of a default.


‘DOLLAR LIQUIDITY TO STABILISE THE NAIRA’

The national oil company announced in August 2023 that the PxF was to the federal government “in its ongoing fiscal and monetary policy reforms aimed at stabilizing the exchange rate market”, describing it as “a relief for the naira”.

It called the facility “crude oil repayment” with an upfront cash loan “against proceeds from a limited amount of future crude oil production”.

At the time, the dollar exchanged for an average of N775 in the official market and N885 on the streets.

The rates have now moved to N1,035/$ (official) and N1,230/$ (parallel).

Nigeria’s outstanding forex liabilities are currently thought to be over $7 billion.

In an explainer after announcing the PxF last year, the NNPC said its exposure is very limited, “covering just a fraction” of their entitlements and that “there are no sovereign guarantees tied to it”.

It said it “will also equip the Federal Government with the necessary dollar liquidity to stabilize the Naira, with limited risk”.

A strengthened naira as a result of the initiative, it said, “will lead to a reduction in fuel costs. This means that if the Naira appreciates in value, the cost of fuel will drop and further increases will be halted”.

It also ruled out subsidies, maintaining that a stronger naira “will result in lower prices from the current level, making subsidies unnecessary. The deregulation policy remains unchanged”.

Critics questioned NNPC’s involvement in getting loans to boost forex reserves when it should be concentrating its efforts on bringing in more oil revenues.

There were also questions over the decision to pledge the tax and royalty oil belonging to the entire federation to secure the loan.

Analysts also queried why the details of the deal were never made public.

https://www.thecable.ng/exclusive-nigeria-to-pay-11-85-interest-on-3-3bn-afriexim-nnpc-loan-pledges-164m-barrels-as-security/amp

Someone should help us multiply $70 by 164,000,000 barrels of crude oil, please.

At the rate our oil have been securitized for foreign loans, I'm not sure we still have up to 1 million barrels of our 1.8 million opec quota for ourselves.

Buhari did his own shortly before leaving office and now this from Asiwaju.

Little wonder government is always resorting to "ways and means" to get money for their domestic obligations.

We are truly in for a long thing.

Has GTB folded? What's going on anyone with any useful information

ijustdey:
......As security



https://www.thecable.ng/exclusive-nigeria-to-pay-11-85-interest-on-3-3bn-afriexim-nnpc-loan-pledges-164m-barrels-as-security/amp

APC have mortgage Nigeria. The loan will not achieve anything meaningful. OBJ have said so, up to 10th generations; they will pay debt.

that is too much.

APC ruined Nigeria for real

Shey, I told people not to look at oil production per day, most of it has been pledge

The rate is too high

where there no alternatives? One that quickly comes to mind is $9bn a so called Diezani made mention of.

The government could also sell its stake in various t oil ventures it has with multinationals.

The government has proven not to be faithful with is little by not fighting inflation with higher interest rates. How then will it manage the $3bn?

Frankly speaking, the country needs an IMF bailout? That's what the institution was made for. Unfortunately, some of its demand will simply not be met such as the downsizing of the bloated civil service. A bailout is therefore dead on arrival.

Na reverse Subsidy be dat......Mugu Nigerians go pay!

Ok

Hmnnn

I hope they know what they are doing. When you borrow to buy bullet proof land cruiser jeeps am sure you don't have plans to payback.

Look at these numbers for God's sake. 😑

Our forex liability is over 7 Billiton usd meaning that the loan no fit achieve anything.

Wahala dey ooooo

At $77.93 per barrel, the 164.25 million barrels of oil pledged by Nigeria equals $12.8 billion — about three times more than the facility taken.

The mangers of Nigeria are the worst, most incompetent, dumbest, most corrupt individuals in the world. That Ghana will pay 8% interest, while Nigeria will pay 12% tells you that the Nigeria project is a failed project, a failed country.

It will be an excruciatingly painful thing to suffer here in Nigeria and end up in hell fire. Accept Jesus today.

How can this work?
If fuel is latter sold for ₦149 per barrel, who will lose?
9 ja and 410 are....

How can this work?
If fuel is latter sold for ₦149 per barrel, who will lose?
9 ja and 410 are....
That deal will benefit same caucus.

How can this work?
If fuel is latter sold for ₦149 per barrel, who will lose?
9 ja and 410 are....
That deal will benefit same caucus.
Who is afrexim and 9ja?

And one guy ( MT) here was insisting it wasn’t a loan but a normal business transaction.

Why does it come with interest? Some people in NL would lie with so much confidence like they know what most people don’t.

Nigeria is gone under APC. The country is in for a big mess. Tinubu will cripple Nigeria completely from where Buhari stopped. They were warned but they didint listen.
A good leader no matter the tribe he comes from roles our good policies and it affectd everyone in the country.
Nothing is left of Nigeria anymore.

Toh
Where's that zombie MT abi wetin who is claiming that the $3.3bn is not a loan
I don't know what they gain from deliberately lying just to defend incompetent people in govt

Artscollection:
Our forex liability is over 7 Billiton usd meaning that the loan no fit achieve anything.

Wahala dey ooooo

An average Nigerian on the streets is still waiting for FDI to add more bundle to the liabilities of $7billion. Nigerian economy needs emergency diversification from oil and gas into other productive sectors such as the technology industry (the backbone of the 21st century economy). that NLNG has also been securitized.

Artiiclebeast:
Someone should help us multiply $70 by 164,000,000 barrels of crude oil, please.

About 11 billion dollars. Pay back for a 3 billion loan.
It is well

sonnie10:


About 11 billion dollars. Pay back for a 3 billion loan.
It is well

Wonderful country.

They always never expect the citizens to go this deep in thinking and analyzing every nonsense they dish out.

Let things work first

sonnie10:
And one guy ( MT) here was insisting it wasn’t a loan but a normal business transaction.

Why does it come with interest? Some people in NL would lie with so much confidence like they know what most people don’t.

That's MT
He even claimed it was smart and novel
Meanwhile from this Op, Ghana is doing exact same thing with cocoa but at lower interest rate

Someone should please educate me, how do you pay $12 billion for a loan of $3billon in just five years. I just weak for this country

FreeStuffsNG where are you? Come and explain to us how this will increase lGR and how its also direct foreign investment.

Heaven knows the amount of corruption in this deal.

Even individuals hardly pay double digits internationally on long term loans much less a country
Is it compulsory to take such loans?

Investment bankers and private equity financiers are smiling to the bank, cool $9b profit, won't be surprised if the real loan providers are Nigerians considering that the company was incorporated in a tax haven, Nigeria is a truly a place to make easy money little wonder why everyone wants to be governor or president, once you attain that position, the Generational money making opportunities are boundless, you dont have to steal directly if you're smart