In the last few days, there have been claims on various social media platforms that the Nigerian National Petroleum Company Ltd borrowed the sum of $1.036bn from the International Monetary Fund to pay for 20 per cent stake in Dangote Refinery and Petrochemical Company.
The claim is also being reported by some online media platforms (Not NewsNGR).
As of 4pm on July 25, the post has been shared on different online platforms by various users.
One of the posts read seen by NewsNGR reads, “You borrow $1bn from IMF in the name of Naija, to pay for 20 per cent of Dangote Refinery Equity. You only pay $350m for seven per cent of Dangote Refinery Option, and pocket over $700m; and leave the Country to be paying unnecessary debt….”
Background
On August 4, 2021, the federal government gave the NNPC Ltd the green light to acquire a 20 per cent stake in Dangote’s oil refinery for $2.76bn. The then Minister of State for Petroleum Resources, Timipre Sylva had revealed the approval by the government.
Then, the 650,000-barrel-per-day oil refinery, owned by Africa’s richest man Aliko Dangote, was under construction in Lagos, the biggest city in the most fuel-consuming nation in the region.
The Dangote Group had previously said NNPC and three other firms had approached it regarding a stake purchase, to be able to secure crude supply agreements.
The 20 per cent stake of NNPCL was for $2.76bn through a $1.036bn funding from Lekki Refinery Funding Limited of which $1bn was paid to Dangote Refinery, according to NNPC audited account.
The Chief Executive Officer of Dangote Refinery, Aliko Dangote, had, two weeks ago claimed that the national oil company no longer owns a 20 per cent stake in Dangote Refinery.
The business mogul had claimed that the Nigerian oil company now owns only 7.2 per cent of the refinery due to the NNPC’s failure to pay the balance of their share, which was due last month in June.
He had stated that while the NNPC had promised to provide the funds, it has been unable to meet its obligations, thus reducing its stake in the $19bn refinery to 7.2 per cent.
The Facts
Checks by NewsNGR showed that NNPC Ltd’s decision not to acquire the 20 per cent was in line with its strategic investment policy. Specifically, the NNPC Ltd periodically assesses its investment portfolio to ensure alignment with the company’s strategic goals.
Specifically, the NNPC Ltd’s decision to cap its equity participation at the paid-up sum was made and communicated to Dangote Refinery several months ago.
The claim by an online medium that the Nigerian National Petroleum Company (NNPC) Ltd has acquired a 20 per cent stake in Dangote refinery for $2.76bn through a $1.036bn loan from the International Monetary Fund (IMF), smirks of ignorance and mischief on the part of the news platform.
Information from the IMF website revealed that unlike development banks, the IMF does not lend for specific projects. Instead, the IMF provides financial support to countries hit by crises to create breathing room as they implement policies that restore economic stability and growth.
The IMF also provides precautionary financing to help prevent crises. IMF lending is continuously refined to meet countries’ changing needs.
In order to set the records straight, NNPC Ltd doesn’t borrow from the International Monetary Fund (IMF).
The NNPC Ltd only borrowed $1bn and paid it to Dangote. This fact has since been verified by the Dangote Group.
The loan, which has been fully settled in June 2024, is also backed by the crude oil supply of 35,000 barrels per day to the Dangote Refinery.
VERDICT:
The claim that NNPC Ltd borrowed $1.03bn from IMF to acquire 20 per cent stake in Dangote Refinery is FALSE