The facility will provide much needed capital for investment in NNPC’s production capacity, which is of strategic importance to the Nigerian economy and the country’s leading source of foreign exchange earnings.
UBA’s position as Mandated Lead Arranger recognises the Group’s strength in structuring and deploying financing to the oil and gas sector, and the depth and liquidity of the Group’s balance sheet.
The second tranche of $500 million, will be provided in local currency, over seven years, with UBA acting as Lead Bank, providing $200 million in Naira equivalent, it said in a statement emailed to PerSecondnews.
UBA has a strong track record in the resources sector across Africa, having facilitated similar oil prepayment deals with the NNPC. UBA was also responsible for the EUR 240m Revolving Crude Oil Financing Facility for the Société Africaine de Raffinage and in Congo Brazzaville co-funded the $250m crude oil prepayment facility for Orion Oil Limited.
In Senegal, UBA was responsible for the EUR 240m revolving crude oil financing facility for the Société Africaine de Raffinage and in Congo Brazzaville co-funded the $250m crude oil prepayment facility for Orion Oil Ltd.
Other participants in the NNPC deal include Standard Chartered Bank, Afrexim Bank, Union Bank and two oil trading companies, Vitol and Matrix.
Speaking on this most recent support for the Nigeria’s petroleum industry, UBA Group Chairman, Tony O. Elumelu saud: “This has been one of the most economically challenging years that Nigeria has witnessed.
“With the sharp drop in the price of oil and the ensuing hardship that followed the onset of the Covid-19 pandemic, the private sector must come together and contribute meaningfully to the economy.
“This facility is clear evidence of this – UBA is providing investment that will significantly improve Nigeria’s production capacity and in doing so also demonstrating the strength, depth, and sophistication of our commercial banking capability.
UBA operates in 20 African countries and globally in the United Kingdom, the United States of America and France, providing retail, commercial and institutional banking services, leading financial inclusion and implementing cutting edge technology.