9 January 2013

Nigeria: TUC Picks Hole in NNPC's U.S.$1.5 Billion Loan

Photo: Leadership
Oil refinery

Lagos — The Trade Union Congress of Nigeria (TUC) has condemned the Nigerian National Petroleum Corporation (NNPC) over the $1.5billion syndicated loan it took to pay debt owed international fuel traders.

President-of the union Comrade Peter Esele told our correspondent that such loan should have been used to build a befitting refinery for the country.

He said such refinery would go a long way in checking the surge of fuel importation into the country.

He also cautioned that the loan should not be allowed to become federal government liability if the NNPC could not honour its promise to debtors.

The NNPC was reported to have sourced a $1.5 billion syndicated loan to enable it pay debts owed international fuel traders like Glencore, Trafigura and Vitol amongst others.

The loan was brokered by Standard Chartered Bank while the cash was provided by several Nigerian and foreign banks, with the NNPC putting up 15, 000 barrels of crude per day as collateral.

But Esele questioned the power of the NNPC to put up the 15,000 barrels as collateral.

He said the NNPC should be given free hand to run as a full commercial entity and bear its own liabilities.

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