The Dangote Petroleum Refinery and Petrochemicals (DPRP) has dismissed allegations that the Nigerian National Petroleum Company Limited (NNPCL) provided a $1 billion loan to the refinery during a liquidity crisis.

In a statement on Wednesday, Anthony Chiejina, DPRP’s Chief Branding and Communications Officer, described the claim as a distortion of facts.

“$1 billion represents just about 5% of the investment in building the Dangote Refinery,” Chiejina clarified, adding that the partnership with NNPCL was based on their strategic role as the largest buyer of Nigerian crude and the primary supplier of petrol in the country.

He revealed that NNPCL initially agreed to purchase a 20% stake in the refinery for $2.76 billion, with $1 billion paid upfront and the balance to be recovered over five years through crude supply deductions and dividends.

“If we faced liquidity challenges, we wouldn’t have offered such generous payment terms,” Chiejina stated, noting that the deal was signed in 2021 when the refinery was still in the pre-commission stage.

Chiejina also addressed NNPCL’s inability to fulfill its commitment to supply 300,000 barrels per day (bpd) of crude, citing the company’s prior commitments to other financiers and unmet production targets.

In response to this shortfall, DPRP extended a 12-month grace period for NNPCL to settle the balance in cash. When NNPCL failed to meet the June 30, 2024, deadline, their equity share was adjusted down to 7.24%.

“These events have been widely reported by both parties,” Chiejina concluded, reiterating that the partnership terms were transparent and not indicative of any financial distress.