The Nigerian National Petroleum Company Limited has serviced part of its $3bn forward-sale loan from the African Export-Import Bank with crude oil worth N991bn in 2024, according to its 2024 financial statement report. The repayment was tied to Project Gazelle, a forward crude oil supply agreement signed in 2023.

On August 17, 2023, The PUNCH reported that the NNPC announced it had secured a $3.3bn emergency loan to repay crude oil obligations from Afreximbank. It explained that the loan would be used by the oil company to support the Federal Government in stabilising Nigeria’s exchange rate.

“The NNPC Ltd. and AFREXIM bank have jointly signed a commitment letter and Termsheet for an emergency $3bn crude oil repayment loan,” NNPC said in a statement.

“The signing, which took place today at the bank’s headquarters in Cairo, Egypt, will provide some immediate disbursement that will enable the NNPC Ltd. to support the Federal Government in its ongoing fiscal and monetary policy reforms aimed at stabilising the exchange rate market,” it added.

Under the deal, NNPC committed to deliver 90,000 barrels of crude oil per day from Production Sharing Contract assets to back a funding facility. According to the 2023 financial statement, a drawdown of $2.25bn had already been achieved by 31st December 2023, with principal repayment scheduled to begin in June 2024.

The funding carried an interest rate of 3-month LIBOR plus 6.5 per cent, with a 6 per cent margin and 0.5 per cent liquidity premium.

According to the 2024 financial statement, the drawdown on the facility had reached N4.9tn out of a total available N5.1tn, while N991bn worth of crude oil had been lifted in repayment, leaving an outstanding balance of N3.8tn at the end of 2024.

The report read, “In December 2023, NNPC Limited entered into a forward sale agreement with Project Gazelle Funding Limited to supply 90,000 bbl. of crude oil per day from Production Sharing Contract Assets for the settlement of a 5-year N2.7tn funding.

“The funding was utilised by the company to finance an advance payment of future taxes and royalty obligations due to the federation on PSC assets managed by the Company on behalf of the Federation.

“As at 31st December 2024, a drawdown of N4.9tn has been achieved from the initial facility of N5.1tn. The interest rate for the facility is 3-month SOFA plus 6.5 per cent while the margin and Liquidity Premium of 0.5 per cent respectively. A total value of Crude Oil worth N991bn has been lifted with a balance of N3.8tn as at 31st December 2024.”

The repayment was made between June and December 2024. However, NNPC did not disclose the identity of the offtakers or exact delivery volumes fulfilled in 2024.

The Project Gazelle arrangement has become one of NNPC’s most significant forward-sale financing vehicles, following a trend of oil-backed loans designed to shore up government revenues, refinance legacy debts, and meet budgetary obligations amid limited fiscal buffers.

The PUNCH earlier reported that the NNPC Ltd is burdened with crude-backed loan obligations estimated at N8.07tn.

The liabilities stretch across multiple forward-sale and project-financing arrangements that are expected to be serviced through substantial crude oil and gas deliveries. The commitments have become a major pillar of NNPCL’s funding structure following years of fiscal pressure, volatile crude production, and declining upstream investment.

Several of the facilities were used to refinance older debts, fund refinery rehabilitation, support cash flow, and meet government revenue obligations.

When assessed together, the company’s major crude-for-loan facilities—Eagle Export Funding (21,000 bpd), Project Yield (67,000 bpd), Project Leopard (35,000 bpd), and Project Gazelle (90,000 bpd)—represent a combined commitment of 213,000 barrels per day, in addition to separate gas-delivery obligations under the NLNG arrangement.

The volume equates to a sizeable share of Nigeria’s daily crude output, underscoring the long-term implications of these arrangements for government revenue, export allocation, and operational flexibility.

The PUNCH also reported that Nigeria’s gross profit from crude oil and gas sales plunged by N824.66bn in 2024 despite a rebound in oil production, according to figures from the Budget Implementation Report for the fourth quarter of 2024 released by the Budget Office of the Federation.

Data from the report revealed that gross profit from crude and gas sales fell to N1.08tn during the year, from N1.90tn in 2023, representing a 43.32 per cent decline.

The Chief Executive Officer of AHA Strategies and oil and gas expert, Mr Ademola Adigun, earlier linked Nigeria’s declining oil earnings to opaque crude-for-cash agreements and undisclosed loan repayments that have tied up part of the country’s crude output.

He said some of the government’s oil barrels were already committed to debt settlements and forward-sale contracts, reducing the actual volume that brought fresh revenue into the Federation Account.

Adigun said, “Some of our crude is already tied up in loan agreements. The problem is that Nigeria doesn’t know the full details of these transactions because there’s little transparency around them.”

He explained that several crude-backed projects, such as Project Gazelle, were carried out without proper public disclosure or parliamentary scrutiny.

He added that the Nigeria Extractive Industries Transparency Initiative should strengthen its audits to determine how much of the country’s crude is being used for debt repayment or swap transactions.