No Conclusive Decision on $5 Billion Nigeria-Aramco Oil-Backed Loan, Says FG

The Federal Government has announced that no definitive decision has been made concerning an oil-backed loan between Nigeria and Aramco, the state-owned oil giant of Saudi Arabia.

Nigeria and Aramco reportedly encounter challenges in finalizing the unprecedented $5 billion oil-backed loan, particularly due to the recent decline in crude prices, which has incited apprehension among the banks anticipated to underwrite the agreement.

In a statement released on Wednesday by Mohammed Manga, Director of Information and Public Relations at the Ministry of Finance, it was emphasized that assertions forecasting the failure of such initiatives are devoid of substantial basis.

Manga noted that market speculation is a frequent phenomenon amidst periods of economic reforms and transactions.

“The Federal Government of Nigeria is cognizant of recent media reports regarding a prospective forward sale of crude oil involving the Nigerian National Petroleum Company Limited (NNPC Ltd),” the statement conveyed.

“While market speculation is not unusual within the framework of ongoing economic reforms and transactions, no conclusive decision has been declared by the Government, and any commentary suggesting the demise of such an initiative is without merit,” he said.

Manga affirmed that the government remains committed to implementing a spectrum of innovative, transparent, and fiscally prudent financing strategies to optimize Nigeria’s oil assets, enhance external liquidity, and fortify macroeconomic stability.

The NNPC has successfully secured several oil-backed loans, including a $3 billion loan from the African Export-Import Bank (Afreximbank) to bolster the naira and stabilize the foreign exchange (FX) market.