Atiku Tasks Tinubu – Explain N3bn Emergency Loan To Nigerians

BY EDMOND ODOK – Former Vice President and Peoples Democratic Party (PDP) presidential candidate in the 2023 general elections, Atiku Abubakar has challenged President Bola Ahmed Tinubu to offer Nigerians an explanation on the $3.3 billion emergency crude repayment loan secured by Nigerian National Petroleum Company Limited (NNPCL).

According to a statement issued on Thursday, Atiku noted that with an interest rate of not more than 12 percent, the President Tinubu-led administration should explain to Nigerians why the $3.3billion loan has to be repaid with the nation’s crude oil worth $12 billion.

Also querying why the government should register a Special Purpose Vehicle (SPV) for the deal in the Bahamas, a country in the Caribbean “warehousing unclean assets”, the Wazirin Adamawa further raised five questions about the deal, noting that it was curious for the government to maintain studied silence on the matter

Consequently, the former Vice President Atiku demanded answers in a statement titled, ‘Tinubu’s administration owes Nigerians an explanation for the NNPC $3.3bn emergency loan’, saying; “In what appears to be a landmark economic decision of the Bola Tinubu-led administration, the Federal Government last year, precisely on August 16, 2023, through the Nigeria National Petroleum Company (NNPC) secured a $3.3 billion emergency crude repayment loan, which according to the NNPC, was to help give support to the Naira and stabilize the Foreign Exchange market.

“The curious thing about this transaction is that up till now, the Federal Government continues to keep mum about it, and the only information available to the public on the mega-deal is coming only through unofficial sources from the NNPC.

“According to information available, a Special Purpose Vehicle called Project Gazelle Funding Limited is driving the deal, and it was incorporated in the Bahamas. The SPV is the borrower while the NNPC is the sponsor, with an agreement to pay with crude oil to the SPV in order to liquidate the loan at an interest rate that is a little over 12 percent.

“What is even more confounding about this deal is why the Federal Government would register a company in the Bahamas, knowing full well the recent scandal of the Paradise Papers that involved that country.

“Curiously also, Nigeria’s current Barrels Produced Daily (BPD) is 1.38 million, and according to the Project Gazelle deal, Nigeria is to supply 90,000 Barrels of its daily production, starting from 2024 till it is up to 164.25 million barrels for the repayment of the loan.

“Now, this is where the details get disturbing because Nigeria’s benchmark for the sale of crude per barrel in 2024 is $77.96. A simple multiplication of that figure by 164.25 will give us a whooping $12bn. It is on this note that we are calling on the Federal Government to speak up on this shady deal.

“It is inconceivable that the Federal Government will lead the country to take a loan of $3.3b with an interest rate that is not more than 12 percent but with estimated repayment amounting to $12bn. That is a humongous differential of about $7b between what is in the details of the deal on paper and what indeed is the reality.

“There are questions to be answered on the integrity of this deal, and we earnestly request the Federal Government to talk directly about these cloudy details behind the deal. “We therefore demand, on behalf of the ordinary people of Nigeria, that the Federal Government provides answers to the following questions.

“Has the Federal Government accessed the loan? Is the loan in the government’s borrowing plan as approved by the National Assembly? Who are the parties to the loan, and what specific roles are they expected to play? What are the conditions of the loan, including tenor, repayment terms, the collateral, and the interest rate?

“And, lastly, why register an SPV in the Bahamas knowing the recent scandal of the country’s notoriety for warehousing unclean assets?”

Forefront News recalled that on August 16, 2023, the NNPCL secured a $3.3 billion emergency crude repayment loan in a transaction meant to support the Naira and stabilise the foreign exchange market.

Packaged by the African Export-Import Bank (AFREXIMBANK), the loan was also targeted at supporting the Federal Government’s monetary and fiscal reforms.

Already, the federal government has received $2.25 billion out of the $3.3 billion Forex facility from the African Export-Import Bank with the funds delivered about three weeks ago.