The Central Bank of Nigeria (CBN) has eased restrictions on the repatriation of oil and gas export proceeds by International Oil Companies (IOCs).
In a recent circular, the CBN clarified that IOCs can now use 50 percent of the proceeds immediately earned in-country for various purposes, including settling Petroleum Tax obligations and paying contractors’ invoices.
Previously, the CBN mandated that only 50 percent of oil and gas export proceeds could be repatriated immediately, with the remaining half required to be held in the country for at least 90 days. However, the latest circular allows the 50 percent held in-country to be utilized for financial obligations within the prescribed 90-day period.
Dr. Mahmoud Hassan, Director of Trade and Exchange at the CBN, outlined that banks could submit requests for cash pooling ahead of the expected receipt date, supported by necessary documentation for approval by the CBN. The repatriated proceeds can now be used for various purposes, including settling tax obligations, payment to contractors, royalties, Cash Calls, loans repayment, and forex sales at the Nigerian Foreign Exchange Market.
Source: Vanguard