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Overview

Bank of China participates in $780 million syndicated loan for Project Falcon

Commitments (Constant USD, 2023)$57,766,860
Commitment Year•2017Country of Activity•NigeriaDirect Recipient Country of Incorporation•NigeriaSector•EnergyFlow Type•Loan

Status

Project lifecycle

Pipeline: Commitment

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Nov 1, 2017

Geospatial footprint

Map overview

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The project involved the development of oil mining licenses (OMLs) 90 and 91and the Okan 30E non-associated gas (NAG) well and associated facilities. More detailed locational information can be found at https://www.openstreetmap.org/relation/11160456.

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Commercial Banks

  • Bank of China (BOC)

Cofinancing agencies

Private Sector

  • Absa Bank Limited
  • Citigroup Inc.
  • Nedbank Ltd
  • Rand Merchant Bank (RMB)
  • Standard Chartered Bank PLC
  • Sumitomo Mitsui Banking Corporation (SMBC)

Receiving agencies

Joint Venture/Special Purpose Vehicles

  • NNPC-CNL

Loan desecription

Bank of China contribution to USD 380 million tranche of syndicated loan for Project Falcon

Interest type•Unknown

Narrative

Full Description

Project narrative

In November 2017, NNPC-CNL JV— a special purpose vehicle and joint venture between Nigerian National Petroleum Corporation (NNPC) Limited [60% equity stake] and Chevron Nigeria Limited (CNL) [40% equity stake] -- signed a $780 million syndicated project finance (loan) agreement with a group of Nigerian banks and international banks (including SMBC, Nedbank, RMB, Absa, Citigroup, Standard Chartered and Bank of China) for Project Falcon (also known as the Sonam Project).The loan consisted of two tranches (facilities): a $400 million Nigerian bank tranche and a $380 million international bank tranche. The borrowing terms of the loan are unknown. However, it is known that the borrower was expected to use the proceeds of the loan to develop oil mining licenses (OMLs) 90 and 91, which were thought to contain a total of around 211 million bbl of oil and 1.9 trillion ft3 of gas. Around $400 million was earmarked for the development of seven wells in OML 91 and the Okan 30E non-associated gas (NAG) well and associated facilities, including the Sonam NAG well platform, in OML 90. Around $380 million was earmarked for reimbursing the project’s lenders. At the time that the loan agreement was signed, Chevron had already spent around $1.5 billion on the Sonam Project, which was expected to begin production within 3–6 months (in 2018).

Staff comments

1. White & Case advised on the transaction. 2. Nigerian National Petroleum Corporation (NNPC) Limited was a Nigerian state-owned corporation at the time that the November 2017 loan agreement was signed. 3. The size of Bank of China’s contribution to the $380 million syndicated international bank tranche is unknown. For the time being, AidData assumes equal contributions across the 7 known contributors to the tranche ($54,285,714).