FG says no final decision yet on $5bn loan from Saudi Aramco

Reuters reported that negotiations on the facility have been delayed by the low price of oil in the international market.

The government in a statement by the Director, Information and Public Relations, Federal Ministry of Finance, Mohammed Manga, said the government was focused on deploying a variety of options to finance its plans.

The statement reads: “The Federal Government of Nigeria is aware of recent media reports concerning a potential forward sale of crude oil involving the Nigerian National Petroleum Company Limited (NNPC Ltd).

“While market speculation is not uncommon in the context of ongoing economic reforms and transactions, no final decision has been announced by the Government, and commentary suggesting the collapse of any such initiative is unfounded.

“The Government remains focused on deploying a range of innovative, transparent, and fiscally responsible financing strategies to optimise Nigeria’s oil assets, improve external liquidity, and strengthen macroeconomic stability.”

Nigeria has in the past few years obtained about $7 billion loans from Afreximbank ($3.3 billion) and other financial institutions using forward sale of its oil production.

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The Aramco deal, if it goes through, would be Nigeria’s largest oil-backed loan to date and Saudi Arabia’s first participation of this scale in the country, although the decline in oil price could shrink the size of the deal, the sources said.

Two of the sources said President Bola Tinubu first broached the loan in November when he met with Saudi Crown Prince Mohammed bin Salman in Riyadh at the Saudi-African Summit.