ADDRESSING NNPCL’S MISINFORMATION

We’ve obtained quite a few inquiries from the media and different involved stakeholders searching for clarification on a latest report attributed to the Nigerian Nationwide Petroleum Firm Restricted (NNPCL) that their resolution to safe a $1 billion mortgage backed by its crude was instrumental in supporting the Dangote refinery throughout liquidity challenges.

We wish to make clear that this can be a misrepresentation of the scenario as $1bn is nearly 5% of the funding that went into constructing the Dangote Refinery.

Our resolution to enter right into a partnership with NNPCL was based mostly on recognition of their strategic place within the business as the most important offtaker of Nigerian crude and on the time, the only real provider of gasoline into Nigeria.

We agreed on the sale of a 20% stake at a worth of $2.76 billion. Of this, we agreed that they are going to solely pay $1 billion whereas the steadiness can be recovered over a interval of 5 years by way of deductions on crude oil that they provide to us and from dividends on account of them. If we had been combating liquidity challenges we wouldn’t have given them such beneficiant cost phrases. As at 2021 when the settlement was signed, the refinery was on the pre-commission stage. As well as, if we had been combating liquidity problem, this settlement would have been money based mostly reasonably than credit score pushed.

Sadly, NNPCL was later unable to produce the agreed 300 thousand barrels a day of crude provided that that they had dedicated a better a part of their crude cargoes to financiers with the expectation of upper manufacturing which they had been unable to attain.

We subsequently gave them a 12-month interval for them to pay money for the steadiness of their fairness given their incapacity to produce the agreed crude oil quantity. NNPCL failed to satisfy this deadline which expired on June thirtieth 2024. Because of this, their fairness share was revised all the way down to 7.24%. These occasions have been broadly reported by each events.

It’s, subsequently, inaccurate to say that NNPCL facilitated a $1 billion funding amid liquidity challenges. Like all enterprise companions, NNPCL invested, $1 billion within the Refinery to amass an possession stake of seven.24% stake that’s helpful to its pursuits.

NNPCL stays our valued companion in progress, and it’s crucial for all stakeholders to stick to the details and current the narrative within the appropriate context, to information the media in reporting precisely for the advantage of our stakeholders and the general public.

Anthony Chiejina

Group Chief Branding and Communications Officer

18th December, 2024