LEGIT NG
Afrexim Bank has disclosed the successful disbursement of the first tranche of the $3.3 billion crude oil repayment loan to the Nigerian National Petroleum Company Limited (NNPC).
The bank stated that the initial disbursement was about $2.25 billion, while the final disbursement of $1.05 billion is expected later.
The loan attracts a 6.0% interest rate per annum
The bank described the loan as a milestone, Nigeria’s largest crude oil repayment facility, and one of the most significant syndicated loans raised in 2023.
The bank said:
“Investors were keen to consider ticket sizes of $250 million and $500 million amidst current headwinds and year-end pressures in the loan markets.”
Per the terms for the 5-year facility, it carries a margin of 6.0% per annum above the 3-month secured overnight financing rate.
Also, the transaction structure has an embedded price balance instrument where 90% of all excess cash from the sale of the committed barrels is used to repay the facility.
Afrexim stated that the arrangement would shorten the loan’s final maturity and free cash flow from Nigeria’s future pledged crude oil cargoes.
According to a report by Leadership, the participating lenders included Afrexim Bank, Gunvnor International BV, and Sahara Energy Resources Limited.
The bank stated that its extensive structuring and technical experience in arranging similar complex oil and gals financing facilities in Angola, Republic, South Sudan, Chad, Egypt, Cote d’Ivoire, and Ghana played a critical role in the global financial market.
