* Last minute deal saves oil traders painful write-downs
* State-oil firm NNPC debt-ridden, mismanaged
* Nigeria won credit ratings upgrades late last year
(Adds details, background)
By Chijioke Ohuocha and Emma Farge
LAGOS/GENEVA, Jan 7 Nigerian state oil firm NNPC
has obtained a $1.5 billion syndicated loan to help it pay debts
to international fuel traders, a senior banking source with
knowledge of the deal said on Monday.
The deal was struck at the end of last year and is seen as
crucial to easing the burden on big commodity traders facing the
prospect of painful multi-million dollar write-offs, oil trading
sources told Reuters.
Had Nigeria defaulted on these loans it could have
restricted the future borrowing capacity of Africa's second
largest economy and would have worried credit agencies like
Fitch and Standard and Poors, which recently upgraded Nigeria.
The loan, provided by several Nigerian and international
banks and brokered by Standard Chartered, will be
paid back over five and half years. The NNPC has put up 15,000
barrels per day of its oil production as collateral, the banking
Standard Chartered and the NNPC declined requests for
The top African oil producer's NNPC owes major commodity
trading houses, including Glencore and Mercuria, around $3.5
billion in unpaid fuel supply bills, according to a report last
year commissioned by the Nigerian oil ministry.
OPEC member Nigeria is among the world's top 10 crude oil
exporters but has insufficient refining capacity to meet its
domestic fuel needs and is heavily reliant on imports, on which
it pays costly subsidies to keep a lid on retail petrol prices.
President Goodluck Jonathan attempted to end fuel subsidies
in Nigeria a year ago but backed down after it sparked
wide-spread protests against higher fuel costs.
Decades of mismanagement and corruption have left NNPC
heavily indebted, several audits have shown.
A list of creditors published in an oil report earlier this
year showed there were 35 firms still owed for fuel.
Trading companies have been battling for months to recoup
the money and some have since stopped supplying Nigeria with
fuels. But they have mostly remained in the west African country
partly because of huge opportunities in the upstream sector.
The list showed that Glencore was owed $138 million, Vitol
was owed $198 million and Trafigura was owed $53 million.
In reality, debts for some individual trading companies are
widely thought to be much higher due to exposure via
subsidiaries and partner firms.
For example, Bermuda corporate registration documents showed
that Calson, owed $115.11 million by NNPC, was using Vitol's
Geneva address. Similarly, Napoil, owed $75.6 million, is a
partner of Trafigura, its website showed.
(Additional reporting and writing by Joe Brock; editing by Tim
Cocks and James Jukwey)