NNPC DEMANDS $1BN ADVANCE PAYMENT FOR CRUDE SALES TO REVAMP REFINERIES

Written by on January 8, 2021

THE NIGERIAN NATIONAL PETROLEUM CORPORATION (NNPC) IS IN NEGOTIATION WITH OIL TRADERS TO SOURCE $1 BILLION IN ADVANCE FOR CRUDE OIL PAYMENT TO REVAMP ITS LARGEST BUT AILING REFINERY IN PORT HARCOURT, REUTERS REPORTED THURSDAY, CITING SEVEN SOURCES CLOSE TO THE HEART OF THE MATTER.

THE FUNDING WILL HELP NNPC CONDUCT A LONG-STANDING OVERHAUL OF THE ASSET AND SCALE DOWN NIGERIA’S HEAVY DEPENDENCY ON IMPORTED FUEL.

THAT MEANS THE COUNTRY WILL BE TAKING ITS SECOND OIL-SUPPORTED FUNDING SINCE THE OUTBREAK OF THE PANDEMIC, WHICH HAS COMPLICATED THE PROCESS OF ATTRACTING INVESTORS AT A TIME FUEL DEMAND IS TAKING A HIT FROM LOCKDOWNS AND RENEWABLE ENERGY DRAWING MORE PATRONAGE FROM USERS THAN FUEL FROM HYDROCARBONS.

REPAYMENT WILL COME OVER A SEVEN-YEAR PERIOD BY WAY OF SUPPLIES OF CRUDE AND PRODUCTS FROM THE REFINERY WHEN THE REHABILITATION IS OVER, THE SOURCES SAID. THE FINANCING WILL BE SPEARHEADED BY AFREXIMBANK.

IT MAY INTEREST YOU TO KNOW THAT, NIGERIA’S FOUR STATE-OWNED REFINERIES HAVE A TOTAL CAPACITY OF 445,000 BARRELS PER DAY.

THEY POSTED LOSSES COMING TO N167 BILLION IN 2019, WHEN THE WARRI REFINERY DID TO REFINE ANY CRUDE.


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