NNPC Settles Part of $3bn Loan with N991bn Crude in 2024 – Report
The Nigerian National Petroleum Company Limited (NNPC) has repaid part of its $3 billion forward-sale loan from the African Export-Import Bank (Afreximbank) with crude oil valued at N991 billion in 2024, according to its 2024 financial statements. The repayment was linked to Project Gazelle, a forward crude supply agreement signed in 2023.
On August 17, 2023, NNPC announced it had secured a $3.3 billion emergency loan from Afreximbank to settle crude oil obligations. The loan was intended to support the Federal Government’s efforts to stabilise Nigeria’s exchange rate. In a statement at the bank’s Cairo headquarters, NNPC said, “The signing provides immediate disbursement that will enable NNPC Ltd. to support the Federal Government in its ongoing fiscal and monetary policy reforms aimed at stabilising the exchange rate market.”
Under the agreement, NNPC committed to deliver 90,000 barrels of crude per day from its Production Sharing Contract (PSC) assets to back the funding facility. By December 31, 2023, $2.25 billion of the loan had been drawn, with principal repayments scheduled to start in June 2024. The facility carried an interest rate of 3-month LIBOR plus 6.5 per cent, with a 6 per cent margin and a 0.5 per cent liquidity premium.
According to the 2024 financial report, the facility had a total drawdown of N4.9 trillion out of the available N5.1 trillion, while crude oil worth N991 billion was delivered as repayment, leaving a balance of N3.8 trillion at the end of the year.
The report explained, “NNPC Limited entered into a forward sale agreement with Project Gazelle Funding Limited to supply 90,000 bbl. of crude per day from PSC assets for the settlement of a 5-year N2.7tn funding. This facility was utilised to finance advance payment of taxes and royalty obligations due to the federation on PSC assets.”
Deliveries under Project Gazelle took place between June and December 2024, though NNPC did not disclose the identity of offtakers or exact volumes delivered. The arrangement has become one of the company’s most significant forward-sale financing vehicles, following a trend of crude-backed loans to support government revenue, refinance legacy debts, and meet budgetary needs amid limited fiscal buffers.
NNPC’s total crude-backed loan obligations are estimated at N8.07 trillion, spread across multiple forward-sale and project-financing deals, which are serviced through crude oil and gas deliveries. These facilities have become central to NNPC’s funding structure amid years of fiscal pressure, fluctuating crude output, and declining upstream investment.
The major crude-for-loan facilities—Eagle Export Funding (21,000 bpd), Project Yield (67,000 bpd), Project Leopard (35,000 bpd), and Project Gazelle (90,000 bpd)—total 213,000 barrels per day, in addition to separate gas delivery obligations under the NLNG arrangement. This represents a significant portion of Nigeria’s daily crude production, highlighting the impact of these deals on government revenue, export allocation, and operational flexibility.
Despite a recovery in oil production, Nigeria’s gross profit from crude and gas sales dropped by N824.66 billion in 2024, according to the Budget Implementation Report for Q4 2024. Gross profits fell from N1.90 trillion in 2023 to N1.08 trillion in 2024, a decline of 43.32 per cent.
Oil and gas expert Ademola Adigun of AHA Strategies linked declining earnings to opaque crude-for-cash agreements and undisclosed loan repayments, which tie up part of the country’s crude output. He noted, “Some of our crude is already committed to debt settlements and forward-sale contracts. The problem is that Nigeria doesn’t know the full details because there is little transparency.”
Adigun also called for stronger audits by the Nigeria Extractive Industries Transparency Initiative to ensure proper disclosure of crude used for debt repayment or swap arrangements.
