Reps Orders NNPC To Stop Alleged Crude-For-Loan Deal—-The House of Representatives Special Joint Committee investigating issues in Nigeria’s petroleum sector has directed the Nigerian National Petroleum Company Limited (NNPC) to stop plans to mortgage the country’s future crude oil until the committee concludes its investigation.
Chaired by Ikenga Ugochinyere, representing Ideato South/Ideato North Federal Constituency, the committee began its probe into questionable deals within the sector last week.
This directive follows reports that the NNPC is planning to secure an additional $2 billion in crude oil-backed loans from international creditors to boost its finances. According to the committee, NNPC Group Chief Executive Officer Mele Kyari has indicated that the company is in discussions to raise this credit facility.
The committee’s concerns stem from findings that the NNPC owes international oil traders $6 billion, amidst subsidy removal. Ugochinyere warned that taking on another loan would undermine the ongoing forensic investigation by the House of Representatives, worsen the country’s financial situation, and deplete resources meant for local refineries.
In his statement on Wednesday, Ugochinyere emphasized that mortgaging future crude revenue for another loan would weaken revenue generation and lead to the waste of future resources. He called for the NNPC to brief the parliament before making further financial commitments.
The committee is currently investigating allegations of non-remittance to the federation account and the non-availability of crude to domestic refineries. The panel urged the NNPC to comply with the Federal Government’s directive to protect local refineries and halt plans for new loans backed by crude oil.
Ugochinyere highlighted that the recent $3.3 billion loan secured by the NNPC from Afreximbank in August 2023 was meant to address forex challenges and should not be compounded by additional debt.
The committee’s stance is clear: further loans backed by crude oil should not proceed without thorough parliamentary scrutiny to safeguard the nation’s resources and ensure the sustainability of local refineries.
