Controversy surrounding the planned procurement of $1.56 billion forward sales agreement package by the Management of the Nigerian National Petroleum Corporation, NNPC, to offset debt obligation was laid to rest on Thursday by representative of the consortium of Nigerian banks said to have facilitated the agreement.

In a presentation at the renewed Hearing of the Joint Committee of the House of Representatives on the alleged transaction, Mr. Ade Adeola, Managing Director, Project and Export Finance of Standard Chartered Bank, who spoke on behalf of the Consortium of banks restated the fact that the said $1.56 billion facility is not a loan but forward sale of crude oil with advance deposits to be made to the Corporation on standard NNPC sale terms at ruling market prices.

Before now, the Honourable Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke and the Group Managing Director of the NNPC, Engr. Andrew Yakubu had in separate presentations to the House Committee explained that the $1.56billion instrument was not a loan but a proposed forward sales agreement to enable the NNPC settle outstanding debt obligations.

Lending credence to this position, Mr. Adeola explained that the sales agreement which is being brokered by four Nigerian banks namely First Bank, UBA, Eco Bank and Standard Chartered Bank is designed to enable NNPC reduce the debts accruing from petroleum products imports.

“The key idea is to enable NNPC immediately raise the sum of US$1.5 billion to pay down outstanding debts.