Atiku Abubakar, former vice president and presidential candidate of the Peoples Democratic Party (PDP), has urged the federal government under President Bola Tinubu to explain the $3.3 billion emergency loan.
Abubakar who raised the questions in a post on X (formerly Twitter) on Thursday, said the Tinubu administration has kept mum about the loan and refuses to make information available to the public.
The Nigerian National Petroleum Company (NNPC) Limited had in August 2023, said it secured a $3 billion emergency crude repayment loan to support the naira and stabilise the foreign exchange market.
However, NNPC secured the crude-for-cash funding from the African Export-Import Bank (Afreximbank) in December 2023.
In the post, the former vice president, said, “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.
“The deal is supposed to be a crude-for-cash loan arranged by the African Export-Import Bank. According to the 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 per cent.”
According to Abubakar, the decision to register a company in the Bahamas, a haven for financial secrecy implicated in the Paradise Papers, throws serious red flags on the entire deal.
“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,” he said.
“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 per cent, but with estimated repayment amounting to $12bn.
Abubakar who also wondered whether the federal government had accessed the loan, said: “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, collateral, and the interest rate?
Abubakar also asked why the SPV is registered in the Bahamas knowing “the recent scandal of the country’s notoriety for warehousing unclean assets”.
He highlighted a $7 billion discrepancy between the NNPC loan face value and its potential repayment, expressing grave concerns about the deal’s true cost.
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