The National Economic Council (NEC) has approved the refinancing of the Nigerian National Petroleum Company (NNPC) Limited’s $3.3 billion Project Gazelle Pre-Export Finance Facility through a new $4.5 billion oil-backed arrangement known as Project Gazelle 2.
The approval was granted during the council’s 159th meeting, which was chaired virtually by Vice President Kashim Shettima.
Under the new arrangement, NNPC will repay the outstanding $1.5 billion from the original facility while securing an additional $3 billion in fresh financing.
The Federal Government said the new funds would help strengthen Nigeria’s foreign exchange reserves, support government finances and fund key infrastructure projects.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the refinancing was negotiated on better terms than the previous agreement, including a reduction in the volume of crude oil committed for repayment.
According to him, the original Project Gazelle required NNPC to dedicate 90,000 barrels of crude oil per day for repayment. Under Project Gazelle 2, that commitment will drop by 12.5 per cent to about 78,750 barrels per day, freeing up an additional 11,250 barrels daily for the federation.
Oyedele said the revised arrangement would provide the country with more liquidity while allowing more crude oil revenue to be available for other national needs.
After reviewing the proposal, NEC expressed support for the implementation of the new financing package, citing its expected positive impact on Nigeria’s foreign reserves and overall fiscal position.
During the meeting, Vice President Shettima also called for a stronger, more responsive and data-driven social protection system to tackle poverty across the country.
He said the success of government policies should be measured by their impact on the lives of ordinary Nigerians, including food prices, healthcare, education, household income, investor confidence and the ability of state governments to deliver development.
Shettima urged members of the council to ensure that government decisions continue to reassure citizens that their concerns are understood and are being addressed with effective policies.
Project Gazelle was first launched in 2023 as a five-year, $3.3 billion crude oil-backed financing facility arranged by Afreximbank. The first $2.25 billion was disbursed in January 2024, followed by another $925 million in June 2024.
The programme provides Nigeria with immediate foreign exchange in exchange for future crude oil export revenues. While Project Gazelle 2 offers additional funding, it also means that part of the country’s future oil earnings will continue to be used to service debt.
The development has once again highlighted the need for Nigeria to reduce its dependence on crude oil revenue by expanding non-oil income sources and investing in alternative energy solutions such as compressed natural gas (CNG) and electric vehicles.
