FG to settle JVC cash call debt with $5bn crude

The Federal Government has reached an agreement with international oil companies to settle its joint venture cash call with crude oil worth $5 billion.

The crude payment will bye spread over the next five years according to the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, in an interview with Financial Times on Tuesday.

The cash call settlement covers outstanding JVC debt for 2010 to 2015.

Though the debt profile is said to be around $6 billion, a figure the Nigerian National Petroleum Corporation, NNPC, has always disputed, the deal will save the nation $1 billion.

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Kachikwu also disclosed that the international oil companies involved are Royal Dutch Shell, ExxonMobil, Eni,Chevron and Total, while the $1 billion already owed for this year would be paid in one off cash payment by the Federal Government.

The Financial Times report also stated that the oil companies have signed the agreement awaiting the approval of two regulatory agencies and President Muhammadu Buhari.

“The settlement had been accepted by the five companies. It is hoped the deal can be finalised before the end of the year,” the report quoted Kachikwu.

By Timothy Enietan-Matthews

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