P-PESPI: AFREXimbank, NNPC Ltd $1.04 Deal, A Game Changer

P-PESPI: AFREXimbank, NNPC Ltd $1.04 Deal, A Game Changer
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The Partners for Petroleum and Energy Sector Prosperity Initiative, P-PESPI has described the AFREXimbank, NNPC deal as a Game Changer and approval by private investors of the certainty introduced into the Fiscal and Regulatory regime of the Nigerian Petroleum sector by the passage of PIA.

The Chairman of P-PESPI, Lord Charles Ibiang, said this on Wednesday, in a press release to the media in Abuja.

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Lord Ibiang, emphasized that NNPC Ltd under the leadership of Group Managing Director, Mele Kyari, is positioning the post PIA National Oil Company as a choice destination for foreign direct investments and investors.

He reteriated in his statement to the press, that “The certainty in the fiscal and regulatory Petroleum sector environment, occasioned by the new PIA is a sure incentive for foreign Capital investment. A lot of upstream activities are showing a lot of impetus to commence operations and scrabble by downstream Investors to control a junk of the market share of our huge Downstream market”.

Lord Charles Ibiang, further post a tacit commendation for NNPC, when he stated that, the transparency and openness by which NNPC has anchored her operations against the former opaque regime is encouraging to the global energy investments eco-system.

“NNPC under Mele Kyari strong drive and commitment towards passage of both PIA and Production Sharing Act is unprecedented as well as historic, because of the lack of courage and political will of past leadership. Even though, Government is a continuum, the strategic and administrative capacity deployed to achieve this great feat, is a function of the competent present leadership of NNPC.

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“This confidence inspired by the progressive fiscal and regulatory in the Petroleum industry, is conferment of the trust these laws have attracted, manifesting as the AFREXimbank, NNPC deal”, he said.

P-PESPI observed that, a lot of FID on multi billion dollars projects, in the Upstream, mid stream and down stream sectors of the Petroleum industry, are waiting to be signed, particularly in the Upstream, the AFREXimbank & NNPC deal is a reassurance of better days ahead and a pointer, that NNPC Ltd is in safe hands.

P-PESPI is happy with the African Export-Import Bank (Afreximbank) which has signed a $US1.04 billion facility with the Nigerian National Petroleum Corporation (NNPC) to finance trade in the products of petroleum sub sector.

The AFREXimbank & NNPC agreement was concluded in Durban on Wednesday during the second intra-Africa trade fair, which opened on 15 November and runs until 21 November.

The transaction comprises a Pre-Export/Shipment Finance Facility underpinned by a Forward Sale Agreement (FSA) and Offtake Contracts from the Nigerian National Petroleum Corporation acting as the Borrower and Seller.

NNPC will enter an FSA within which it shall deliver 35,000 barrels of crude oil per day. The proceeds of the facility will boost tax revenues and foreign currency receipts and create thousands of jobs in the oil and gas refining value chain, all by more than US$2.4bn to the immediate benefit of the government, and Nigerian Citizens, thereby improving the balance of trade and Gross Domestic Product in Nigeria – Africa’s largest economy.

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P-PESPI is seriously delighted, that the deal signed by Mr Umor Ajia, NNPC Executive Director and Group Chief Executive Officer on behalf of NNPC, reflected a solid Corporate Governance adherence embedded in Nigerian local content laws, which the transaction complies with Afreximank’s mandate to promote local content in Africa’s Oil and Gas and other mining industry and generate foreign receivables into Africa.

A forward looking NNPC, capable of operating locally, but globally competitive is born under Mele Kyari Leadership.

P-PESPI, call on Global and local investors, to take advantage of the huge potentials and opportunity in the stable Nigerian Petroleum and Energy Sector, and invest heavily, because Capital is safe and profit is maximum.

P-PESPI understand the current global energy transition movement from fossil fuel to cleaner energy sources, however, fossil fuel will continue to be relevant, though more refined, in the nearest future. As our commitment to the global climate Action, we insist the need for heavy polluters Countries, who have established a trajectory of development and growth, should acknowledge the need for equity, through Energy Justice Mechanism to brigde the developmental and INFRASTRUCTURAL deficit, which our resources based system, sincerely want to addressed.

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These sentiments, was Succinctly captured, While lauding the deal as very innovative, Afreximbank President and Chairman of the Board of Directors Prof. Benedict Oramah explained the Bank’s decision in the context of the world’s climate change agenda, saying this is a case of adopting a balanced approach.

Prof. Oramah added that Africa is more of a victim than a perpetrator in the emission of destructive greenhouse gases, contributing only a meagre 4%, while a majority of the Continent, ironically having been left behind development wise, still has to depend on fossil fuel for survival, and should thus not bear the brunt of the punishment for the mistakes of others.

“Stopping development for parts of Africa today to achieve to a clean environment for the whole of the World is not justice.

“It’s important, Nigerian Citizens support the Mele Kyari Leadership, it has show a lot of commitment and loyalty to bequeath a better Petroleum and Energy Sector”.

Aljazirahnews


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Chairman of P-PESPIMele KyariNNPC Ltd