Economy
Oando Raises $550m to Support Nigeria’s Sustainable Development
By Adedapo Adesanya
Oando Plc has confirmed putting down about $550 million in the $925 million crude oil loan financing deal to Nigeria from the African Export-Import Bank (Afreximbank) to support the country’s sustainable development.
The deal named Project Gazelle was sponsored by the Nigerian National Petroleum Company (NNPC), but arranged and coordinated by Afreximbank, involving other crude oil off-takers like Sahara Energy and others.
The total funded facility size for Project Gazelle is about $3.175 billion, a statement from the company said. The project is a $3.3 billion structured crude oil-backed forward-sale finance facility.
The unique financing arrangement is backed by crude oil allocation from the royalties and tax entitlements of the Nigerian government and is a first of its kind in Africa’s largest economy.
The funds were provided to enable the much-required forex injection into Nigeria’s economy, helping the government meet its immediate obligations.
It is also expected to enable investments in critical projects to boost production and in turn, generate increased revenues, part of which would be used in paying off the facility over five years, it noted.
Speaking on Oando’s participation, Mr Wale Tinubu, the chief executive, said the transaction further reinforces the energy firm’s ability to create value and the company’s status as the indigenous partner of choice in Nigeria.
”The successful completion of this facility signifies another win for the company and the country at large. The transaction further reinforces Oando’s ability to create value and the company’s status as the indigenous partner of choice in Nigeria.
“As a proudly indigenous company, our ambition has always been to use our platform to support the sustainable development of the nation. Against this backdrop, Project Gazelle will be instrumental in realising the federal government’s efforts to boost the country’s socio-economic indices.
“Afreximbank as lead arranger continues to support African corporations – public and private growing confidence in the market and continent,” Mr Tinubu stated.
One of the key reasons given for the novel Project Gazelle, Oando said, was its ability to avail the federal government in the immediate to medium term with access to funding for investments in critical sectors that will help in reversing some negative economic indices and trends, while positively impacting the lives of its citizens.
In a joint statement with Afreximbank, NNPC’s Group CEO, Mr Mele Kyari commended the bank’s management and team for their investment philosophy and active interest in the co-creation of prosperity.
“The successful disbursement of the first accordion under Project Gazelle and its interest in funding viable and strategic projects is a clear indication of investors’ confidence in NNPC and Nigeria’s growth aspirations,” he said.
He further assured Afreximbank and all investing communities of NNPCL’s resolve to continue to grow the nation’s hydrocarbon resources and strengthen its partnerships across the oil and gas value chain locally, and globally.
Commenting on the disbursement, President & Chairman of the Board of Directors, Afreximbank, Mr Benedict Oramah, said the funding will greatly support the attainment of Nigeria’s short and long-term economic development priorities
“The milestone achieved thus far, on this facility, demonstrates the bank’s capabilities in performing its role as a crucial development partner for Africa. It reaffirms our commitment to assisting our member states in their efforts to achieve economic growth and stability.
“This funding will greatly support the attainment of Nigeria’s short and long-term economic development priorities,” he stated.
Mr Oramah described the original facility as ‘a landmark’ for being the largest crude oil-backed facility in Nigeria and one of the largest syndicated debts raised in Africa.
He added that the closure of the first accordion demonstrated the existence of a positive market appetite for well-structured commodities-backed instruments.
Oando also announced the lifting of the suspension of the company’s secondary securities listing on the Johannesburg Stock Exchange (JSE).
After a two-month suspension, the JSE’s recent action means investors in South Africa are now able to trade in Oando’s securities on the country’s exchange, it said.
Furthermore, Oando said it saw a positive swing in its NGX share price appreciating by 52.8 per cent between April 28 to June 6, 2024, a period that saw the company release its audited FYE2022 results and shortly after at the end of May, its interim FYE2023 results.
It pointed out that investors had shown a strong and positive response to the release of the company’s 2023 unaudited financial reports which showed a major recovery for the indigenous energy company.
“Oando’s FYE2023 interim report showed a 71 per cent increase in turnover from N1.9 trillion in 2022 to N3.4 trillion in 2023 as well as a Profit after Tax position of N74.7billion, a 192 per cent increase from the preceding year.
“After recent upheavals, it looks like exciting times are ahead for Oando, its shareholders, the investing public and the Nigerian economy,” said the statement.
By Adedapo Adesanya
President Bola Tinubu on Friday presented a budget proposal of N58.47 trillion for the 2026 fiscal year titled Budget of Consolidation, Renewed Resilience and Shared Prosperity to a joint session of the National Assembly, with capital recurrent (non‑debt) expenditure standing at 15.25 trillion, and the capital expenditure at N26.08 trillion, while the crude oil benchmark was pegged at $64.85 per barrel.
Business Post reports that the Brent crude grade currently trades around $60 per barrel. It is also expected to trade at that level or lower next year over worries about oil glut.
At the budget presentation today, Mr Tinubu said the expected total revenue for the year is N34.33 trillion, and the proposal is anchored on a crude oil production of 1.84 million barrels per day, and an exchange rate of N1,400 to the US Dollar.
In terms of sectoral allocation, defence and security took the lion’s share with N5.41 trillion, followed by infrastructure at N3.56 trillion, education received N3.52 trillion, while health received N2.48 trillion.
Addressing the lawmakers, the President described the budget proposal as not “just accounting lines”.
“They are a statement of national priorities,” the president told the gathering. “We remain firmly committed to fiscal sustainability, debt transparency, and value‑for‑money spending.”
The presentation came at a time of heightened insecurity in parts of the country, with mass abductions and other crimes making headlines.
Outlining his government’s plan to address the challenge, President Tinubu reminded the gathering that security “remains the foundation of development”.
He said some of the measures in place to tame insecurity include the modernisation of the Armed Forces, intelligence‑driven policing and joint operations, border security, and technology‑enabled surveillance and community‑based peacebuilding and conflict prevention.
“We will invest in security with clear accountability for outcomes—because security spending must deliver security results,” the president said.
“To secure our country, our priority will remain on increasing the fighting capability of our armed forces and other security agencies by boosting personnel and procuring cutting-edge platforms and other hardware,” he added.
By Aduragbemi Omiyale
The deadline for the recapitalisation of the Nigerian pension industry has been extended by six months to June 2027 from December 2026.
This extension was approved by the National Pension Commission (PenCom), the agency, which regulates the sector in the country.
Addressing newsmen on Thursday in Lagos, the Director-General of PenCom, Ms Omolola Oloworaran, explained that the shift in deadline was to give operators more time to boost the capital base, dismissing speculations that the exercise had been suspended.
“The recapitalisation has not been suspended. We have communicated the requirements to the Pension Fund Administrators (PFAs), and we expect every operator to be compliant by June 2027. Anyone who is not compliant by then will lose their licence,” Ms Oloworaran told journalists.
She added that, “From a regulatory standpoint, our major challenge is ensuring compliance. We are working with ICPC, labour and the TUC to ensure employers remit pension contributions for their employees.”
The DG noted that engagements with industry operators indicated broad acceptance of the policy, with many PFAs already taking steps to raise additional capital or explore mergers and acquisitions.
“You may see some mergers and acquisitions in the industry, but what is clear is that the recapitalisation exercise is on track and the industry agrees with us,” she stated.
PenCom wants the PFAs to increase their capital base and has created three categories, with the first consists operators with Assets Under Management of N500 billion and above. They are expected to have a minimum capital of N20 billion and one per cent of AUM above N500 billion.
The second category has PFAs with AUM below N500 billion, which must have at least N20 billion as capital base.
The last segment comprises special-purpose PFAs such as NPF Pensions Limited, whose minimum capital was pegged at N30 billion, and the Nigerian University Pension Management Company Limited, whose minimum capital was fixed at N20 billion.
By Adedapo Adesanya
Three securities weakened the NASD Over-the-Counter (OTC) Securities Exchange by 0.68 per cent on Thursday, December 18.
According to data, Central Securities Clearing System (CSCS) Plc led the losers’ group after it slipped by N2.87 to N36.78 per share from N39.65 per share, Golden Capital Plc depreciated by 77 Kobo to end at N6.98 per unit versus the previous day’s N7.77 per unit, and FrieslandCampina Wamco Nigeria Plc dropped 19 Kobo to sell at N60.00 per share versus Wednesday’s closing price of N60.19 per share.
At the close of business, the market capitalisation lost N16.81 billion to finish at N2.147 billion compared with the preceding session’s N2.164 trillion, and the NASD Unlisted Security Index (NSI) declined by 24.76 points to 3,589.88 points from 3,614.64 points.
Yesterday, the volume of securities bought and sold increased by 49.3 per cent to 30.5 million units from 20.4 million units, the value of securities surged by 211.8 per cent to N225.1 million from N72.2 million, and the number of deals jumped by 33.3 per cent to 28 deals from 21 deals.
Infrastructure Credit Guarantee Company (InfraCredit) Plc remained the most traded stock by value with a year-to-date sale of 5.8 billion units valued at N16.4 billion, followed by Okitipupa Plc with 178.9 million units transacted for N9.5 billion, and MRS Oil Plc with 36.1 million units worth N4.9 billion.
Similarly, InfraCredit Plc ended as the most traded stock by volume on a year-to-date basis with 5.8 billion units traded for N16.4 billion, trailed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.7 million, and Impresit Bakolori Plc with 536.9 million units exchanged for N524.9 million.
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