By Modupe Gbadeyanka
The chief executive of the Nigerian National Petroleum Company (NNPC) Limited, Mr Mele Kyari, has revealed plans to source another $2 billion crude-for-cash loan to strengthen its working capital.
According to Reuters, the state-owned oil agency intends to get the $2 billion loan and repay it with crude oil from the country, which is also the collateral.
Mr Kyari disclosed that the funds would be taken against 30,000-35,000 barrels per day of crude production, and be used for all of the NNPC’s business activities, including supporting production growth.
“We have no problem covering our gasoline payments. This is just money for normal business and not a desperate act,” the NNPC chief informed Reuters.
Recall that on August 16, 2023, the NNPC secured a $3.3 billion emergency crude repayment loan arranged by the African Export-Import Bank (Afreximbank) to support the naira and stabilise the foreign exchange (FX) market.
It is not certain if Afreximbank will be involved in the fresh crude-for-cash loan of the NNPC, but Mr Kyari explained that, “It will be syndication with critical but regular partners who have been in business with our company to forward the cash.”