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VENTURES AFRICA – Nigeria’s Liquefied Natural Gas company (NLNG) has established a $1 billion Local Vendor Financing Scheme that will provide domestic contractors with easy access to bank loans at affordable rates.
The scheme was flagged off after the signing of deal between the company and 5 participating banks including Access Bank, First Bank of Nigeria, Standard Chartered Bank, United Bank for Africa and Zenith Bank, Premium Times reported.
It is aimed at reducing barriers such as high operating cost and inadequate mobilization capital, which limits local contractors in effectively executing projects.
“This is just a step, and in the right direction. The success of any local contractor is linked to larger and smaller businesses around it in the value chain,” said Mr Babs Omotowa, NLNG’s MD/CEO.
“We need to further develop initiatives as an enabler or platform to develop the value chain and maximize the opportunities of the future, especially with huge projects in sight, such as the Federal Government’s Gas Master Plan initiative and Train 7.”
The scheme is in line with Nigeria’s bid to increase local content participation in the oil and gas industry.
Following its launch, registered indigenous contractors can approach any of the participating banks for a loan request with proof of an NLNG awarded contract.