African Export-Import Bank said it has successfully arranged a syndicated $3.3 billion crude oil prepayment facility sponsored by the Nigerian National Petroleum Company Limited and that an initial disbursement of $2.25 billion has been made.
A second tranche of $1.05 billion is expected to be disbursed subsequently. Afreximbank said: “This landmark financing is Nigeria’s largest crude oil prepayment facility and one of the largest syndicated loans raised in Africa in 2023. Investors were keen to consider ticket sizes of $250 million and $500 million amidst current headwinds and year-end pressures in the loan markets. The 5-year facility carries a margin of 6.0% per annum above the 3-month secured overnight financing rate (SOFR). The transaction structure has an embedded price balance mechanism where 90% of all excess cash from the sale of the committed barrels (after debt service) will be released while the balance of 10% will be used to prepay the facility, effectively shortening the final maturity of the facility and freeing cash flow from future pledged cargoes for use by Nigeria.
“The initial participating lenders are Afreximbank, Africa’s multilateral trade finance institution, Gunvor International BV, a Geneva-based multinational energy and commodities trading company and Sahara Energy Resources Limited.”AFRICAN Export-Import Bank said it has successfully arranged a syndicated $3.3 billion crude oil prepayment facility sponsored by the Nigerian National Petroleum Company Limited and that an initial disbursement of $2.25 billion has been made.
A second tranche of $1.05 billion is expected to be disbursed subsequently. Afreximbank said: “This landmark financing is Nigeria’s largest crude oil prepayment facility and one of the largest syndicated loans raised in Africa in 2023. Investors were keen to consider ticket sizes of $250 million and $500 million amidst current headwinds and year-end pressures in the loan markets. The 5-year facility carries a margin of 6.0% per annum above the 3-month secured overnight financing rate (SOFR). The transaction structure has an embedded price balance mechanism where 90% of all excess cash from the sale of the committed barrels (after debt service) will be released while the balance of 10% will be used to prepay the facility, effectively shortening the final maturity of the facility and freeing cash flow from future pledged cargoes for use by Nigeria.
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