Nigerian Reps Summon NNPC Boss, Suspend $1.5b Loan

DESMOND UTOMWEN/Abuja

The House of Representatives has ordered the Nigerian National Petroleum Corporation (NNPC) to stop further action on the controversial $1.5 billion syndicated credit. The loan deal, which the federal lawmakers described as “illegal” was reportedly obtained by the national oil company to pay off accumulated debts for petrol already supplied by foreign importers. The NNPC has denied obtaining the loan.

The suspension order on the loan according to the resolution of the House is expected to last until the outcome of an investigation into the deal.

The decision of the House was prompted by a motion sponsored by Ralph Nnanna Igbokwe on the loan deal. Igbokwe had argued that the NNPC had many questions to answer on the circumstances of the loan.

House Speaker, Aminu Waziri Tambuwal detailed the standing Committees on Loans and Debt, Justice, Petroleum Resources Downstream and Upstream to investigate the loan deal and report to the House within 14 days.

Meanwhile, NNPC’s Group Managing Director, Mr. Andrew Yakubu is expected to appear before the House Committee on Petroleum Resources (Upstream) to explain the $1.5 billion loan, the committee’s Chairman, Muraina Ajibola disclosed at Wednesday’s plenary. Ajibola said the committee had summoned the NNPC GMD via a letter dated January 11.

In a monitored report, the NNPC insisted that the $1.5billion loan was purely a “commercial decision” taken by the corporation to pay off accumulated debts for petrol already supplied by foreign importers and to save Nigeria’s credit rating in the international markets.

International news agency, Reuters, which broke the news on the loan deal, said it was struck towards the end of last year.

The loan, provided by several Nigerian and international banks, was brokered by Standard Chartered Bank.

The NNPC pledged 15, 000 barrels of crude per day as collateral with an agreement to pay the loan back in five and a half years.

The NNPC is believed to owe foreign commodity traders over $4 billion for petroleum products supplied over the years.

The National Assembly had on December 13, 2012, approved a N161billion supplementary budget requested by President Goodluck Jonathan to settle fuel subsidy payments for the remaining part of the year to ensure steady fuel supply during the yuletide.