NEC Approves $4.5B ‘Project Gazelle 2’ Crude-Backed Loan to Boost Nigeria’s Reserves

The National Economic Council (NEC) has approved the restructuring and expansion of Nigeria’s crude oil-backed loan facility, scaled up to $4.5 billion under a new deal named “Project Gazelle 2.”

The new arrangement allows the Nigerian National Petroleum Company (NNPC) Limited to refinance the outstanding $1.5 billion from the original 2023 facility. Additionally, it unlocks $3 billion in fresh funding aimed at stabilizing the country’s foreign exchange reserves and boosting liquidity.

Understanding Project Gazelle and the Need for Expansion

Project Gazelle was originally launched in late 2023 as a $3.3 billion crude oil pre-export finance facility. Sponsored by the NNPC Limited, the structured loan was arranged by Afreximbank to provide urgent dollar liquidity to the Central Bank of Nigeria (CBN). This was crucial to help stabilize the volatile foreign exchange market and ease the pressure on the Naira.

Under the initial terms, Nigeria committed a specific volume of future crude oil production to repay the debt over a set period.

The transition to Project Gazelle 2 represents a major strategic shift.

Implications

Refinancing Debt: By rolling over the remaining $1.5 billion from the 2023 agreement, the government extends its repayment timeline and restructures its immediate obligations.

Injecting Fresh Liquidity: The additional $3 billion brings immediate foreign currency into the central bank’s reserves. This pool of dollars is intended to defend the Naira against speculative attacks and settle outstanding FX backlogs.

While the expansion provides an immediate fiscal cushion for the federal government, economic analysts closely monitor these forward-sale agreements, as they tie up future oil revenues to service current debts.