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HomeBusiness NewsNNPC Pays $833.57 Mln Cash-Call Arrears To Mobil Producing

NNPC Pays $833.57 Mln Cash-Call Arrears To Mobil Producing

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Nigeria’s state-run oil firm has released $833.57 million to Mobil Producing Nigeria (MPN) as full settlement of outstanding in cash call payment, the Nigerian National Petroleum Corporation (NNPC) said on Wednesday.

NNPC

In a statement by the corporation’s spokesman Ndu Ughamadu, the corporation said it was able to achieve this barely two years after it signed a Cash-call Repayment Agreement with its Joint Venture partners to defray cash-call arrears within a period of five years.
The statement quoted the outgoing Group Managing Director of NNPC, Maikanti Baru as saying that the feat was a product of determination and hard work.
Baru noted that NNPC management came up with the novel cash-call exit strategy to boost investors’ confidence and grow the nation’s oil and gas industry.
He added that the payment did not in anyway undercut remittances to the Federation Account as it was achieved through revenue from incremental production.
“It is gratifying to note that within two years of this agreement, the NNPC/MPN JV significantly executed in incremental activities that generated adequate proceeds to liquidate the $833.57 million cash-call arrears, whilst ensuring that revenue flow from the JV to the Federation remained stable,” he said
He explained that with the close-out of the repayment agreement, the entire incremental production which is over 45,000 barrels of oil per day (bopd) had been migrated to Federation’s equity and would invariably lead to an increase in revenue to the Government.
He acknowledged the support of President Muhammadu Buhari and some relevant agencies in achieving the speedy execution of the repayment plan.
The GMD added the next level “is for NNPC and MPN to within two years, migrate the Joint Venture (JV) into an Integrated Joint Venture (IJV) with its Board operating independently and paying dividends to its shareholders”.
On his part, the Managing Director of the Mobil Producing Nigeria, Mr Paul McGrath said the milestone was a victory for MPN, NNPC and Federal Government of Nigeria.

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