Oando Plc, a prominent indigenous energy company, has disclosed its successful involvement in the Project Gazelle financing deal with a significant contribution of $550 million. This participation has raised the total disbursed amount for the project to $925 million, in an initiative led by the Nigerian National Petroleum Company Limited (NNPCL).
The African Export-Import Bank (Afreximbank) orchestrated the financing arrangement, accumulating a total of $925 million from a consortium of crude oil off-taker lenders, including Oando Group and Sahara Energy. This brings the total funded facility size for Project Gazelle to an impressive $3.175 billion.
Project Gazelle is structured as a $3.3 billion crude oil-backed forward-sale finance facility, a pioneering arrangement in Nigeria. The financing, secured through crude oil allocations from government royalties and tax entitlements, aims to provide much-needed foreign exchange to Nigeria’s economy, aiding the government in meeting its immediate financial obligations.
In addition to addressing immediate fiscal needs, the funding from Project Gazelle is intended to stimulate investments in critical projects that will enhance production capabilities and increase revenue. These revenues are expected to help repay the facility over a five-year period.
Wale Tinubu, Group Chief Executive of Oando Plc, highlighted the significance of this transaction, noting that it reinforces Oando’s ability to generate value and strengthens its reputation as a preferred indigenous partner in Nigeria. He emphasized that Project Gazelle will play a crucial role in advancing the federal government’s socio-economic goals.
In a joint statement, NNPCL’s Group CEO, Mele Kyari, praised Afreximbank for its investment approach and active collaboration in fostering economic growth. He assured Afreximbank and other investors of NNPCL’s commitment to enhancing Nigeria’s hydrocarbon resources and maintaining robust partnerships across the oil and gas sector both locally and internationally.
Afreximbank President and Chairman, Professor Benedict Oramah, expressed confidence in the bank’s role as a key development partner for Africa. He stated that the funding will significantly support Nigeria’s economic development goals, both in the short and long term. Oramah also lauded the original facility as a landmark achievement, being the largest crude oil-backed facility in Nigeria and one of the largest syndicated debts in Africa. The successful closure of the first tranche demonstrated strong market confidence in well-structured commodities-backed instruments.
In a separate development, Oando announced the resumption of its secondary securities listing on the Johannesburg Stock Exchange (JSE) after a two-month suspension. This move allows South African investors to trade Oando’s securities once again.
Oando also reported a substantial increase in its share price on the Nigerian Exchange (NGX), appreciating by 52.8% from April 28 to June 6, 2024. This period saw the release of Oando’s audited full-year 2022 results and interim full-year 2023 results, which received a positive response from investors. The interim report showed a 71% increase in turnover, reaching N3.4 trillion in 2023, and a profit after tax of N74.7 billion, marking a 192% increase from the previous year.
With these developments, Oando appears poised for a promising future, benefiting its shareholders, the investing public, and the broader Nigerian economy.
