As a demonstration of its dedication to fostering public-private partnerships that enhance national development, the Nigerian National Petroleum Company Limited (NNPC Ltd) said it used its crude to back the Dangote Refinery in securing a $1 billion loan during liquidity crisis.
The $1 billion loan formed part of the equity owned by the NNPCL in the refinery.
The move, according to the company, paved the way for the establishment of Nigeria’s first private refinery.
Chief Corporate Communications Officer (CCCO) NNPC Ltd Femi Soneye said this at the energy relations stakeholder engagement Monday in Abuja.
Although the NNPC initially had equity of about 20 per cent in the refinery, it was subsequently reduced to 7.25 per cent.
It is also on record that at a press briefing at the refinery in July, President Dangote Group Aliko Dangote had said the national oil company owns only 7.2 per cent stake in the refinery due to its failure to pay the balance of its share, which was due in June.
And in confirming the Dangote’s position, the NNPCL said its assessment of the investment portfolio led to the decline in its share of the refinery.
The interest, which the company said was worth $2.76 billion, was financed by a forward sale agreement of $1.036 billion out of which $1 billion was paid to Dangote Petroleum Refinery and Petrochemicals Free Zone Enterprise (DPRP FZE).
“The balance of the cost of equity investments made in DPRP FZE, which is USD1.76 billion has been agreed to be paid in cash instead of the proposed crude discount of $2.5/bbl on the official selling price of crude oil,” the NNPC said.
The 650,000 barrels per day Dangote Petroleum Refinery, located on the outskirts of Lagos, was inaugurated recently amid expectations that it will address some of the issues affecting the sector, particularly a crash in the prices of fuel.
…Soneye
Speaking at the stakeholder engagement Monday in Abuja, Mr Soneye, the NNPCL spokesman, told the gathering that the initiative underscores the national oil company’s dedication to fostering public-private partnerships that drive national development.
According to him, under the leadership of the Group’s Chief Executive Officer, Malam Mele Kyari, the NNPCL had achieved several notable milestones, including the successful restart of the Port Harcourt Refinery, pioneering the adoption of Compressed Natural Gas (CNG), and reporting its first profit in decades, amongst others.
Soneye said in a historic achievement, the NNPCL, under Kyari’s leadership, declared profit for the first time in decades, marking a significant financial turnaround.
The NNPCL image maker said the restart of the Port Harcourt Refinery marks a significant turning point in Nigeria’s quest for energy self-sufficiency, reaffirming the company’s commitment to revitalising the nation’s refining capacity.
He said: “The restart of the Port Harcourt Refinery marks a significant turning point in Nigeria’s quest for energy self-sufficiency, reaffirming the company’s commitment to revitalizing the nation’s refining capacity.
“NNPC has also championed the adoption of Compressed Natural Gas (CNG) as an alternative energy source, offering Nigerians a cleaner and more cost-effective solution amidst rising global energy costs.
“A strategic decision to secure a $1 billion loan backed by NNPC’s crude was instrumental in supporting the Dangote Refinery during liquidity challenges, paving the way for the establishment of Nigeria’s first private refinery. This initiative underscores NNPC’s dedication to fostering public-private partnerships that drive national development.
“In a historic achievement, NNPC, under Kyari’s leadership, declared profit for the first time in decades, marking a significant financial turnaround. The company has already exceeded its profit projections for 2024, a testament to the transformative reforms it has implemented.
“Additionally, Kyari facilitated the $3 billion Gazelle loan, a critical intervention that helped stabilize the federation during a challenging foreign exchange crisis.
“As a responsible energy company, NNPC Ltd continues to strengthen Nigeria’s energy sector while solidifying its legacy as a transformative force and a global game-changer.”
He noted that energy relations are the backbone of the oil giant’s operations and strategic aspirations as an integrated energy company.
“In a rapidly evolving global energy landscape, fostering strong relationships with stakeholders across the value chain is not just a priority but a necessity for achieving our objectives and ensuring energy for today and tomorrow,” Soneye added. (Additional report from Premium Times)