Connect with us

Business

PIA: NNPC secures $5bn funding from AfreximBank

Published

on

PIA: NNPC secures $5bn funding from AfreximBank

The African Export Import Bank (Afriexim Bank) has committed $5 billion in corporate finance to the Nigerian National Petroleum Company Ltd to support major investments in Nigeria’s upstream oil industry.

The funding would also be used to finance part of the NNPC’s acquisition of interest in quality upstream oil and gas producing assets.

NNPC announced this following a meeting with AfreximBank on Wednesday in Cairo, Egypt.

The agreement is seen as a major achievement of the Petroleum Industry Act (PIA) signed by President Muhammadu Buhari in August 2021.

Read also: NNPC promises more revenue, despite remitting only 17% of what it made in 11 months

During the meeting attended by NNPC Managing Director, Malam Mele Kyari, and President of the African Export-Import Bank (Afreximbank) Prof Benedict Oramah an agreement was reached to also intensify efforts at deepening investment in Nigeria’s oil sector and business collaboration.

The repayment of the funding is expected to be done through a Forward Sale Arrangement whereby the funds provided will constitute the payment purchase of 90-120kpd of crude within a four to eight year period.

As part of the landmark transaction, Afreximbank will also underwrite $1bn as part of forward sales base trade finance transaction.

The two institutions will also explore the idea of establishing a pan-African Energy Transition Bank.

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now

Investigations