FG Speaks On Why It Took $500m EXIM Bank Loan

FG Obtains $500M Chinese Loan Facility

The Federal Government says it has secured a $500 million loan facility from the Export Import Bank of China through the Bank of Industry to establish modular refineries and implement the Flare Gas Recovery Programme.

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Naija News understands that the establishment of modular refineries is part of the federal government’s strategy for ending importation of petroleum products and discouraging illegal oil bunkering in the Niger Delta.

Speaking at the signing ceremony in Beijing, China, Chief Executive of BoI, Mr. Olukayode Pitan, reiterated the job creation potential of this partnership.

He said: “I am delighted to begin the next chapter of a long-term trading relationship with China through CEXIM.

“This agreement is set to create over 100,000 jobs in Nigeria’s Oil & Gas sector—a decisive move that will advance the Federal Government’s Modular Refineries and Flare Gas Recovery Programme.”

Essentially, the Memorandum of Understanding (MoU) between BOI and CEXIM stipulated that the loan facility will be utilised to finance the purchase of equipment and machinery from China by investors and project owners of modular refineries in the country.

The purpose is to ensure availability of refined petroleum products within the country, monetise gas flare, reduce cost of products in the mid-term and provide employment for Nigerians.

The facility can be accessed via letters of credit issued for the delivery of specified modular refineries and gas processing equipment to qualified Nigerian companies establishing petrochemical facilities under the modular refineries and gas flare recovery programme.

To date, a total of 38 operating licenses had already been granted by the Federal Government to establish modular refineries in the Niger Delta, according to a statement issued by the development finance institution Saturday.