Nigeria’s National Economic Council (NEC) has approved a new $4.5 billion oil-backed pre-export financing facility for Nigerian National Petroleum Company Limited (NNPC Ltd.), replacing part of an existing arrangement with a larger and more flexible structure aimed at strengthening the country’s foreign exchange reserves, easing pressure on public finances and creating additional funding for infrastructure.

The new facility, known as Project Gazelle 2, will refinance the remaining $1.5 billion outstanding under the original $3.3 billion Project Gazelle financing arranged in 2023, while unlocking an additional $3 billion in fresh liquidity, according to a statement issued by the Presidency after Monday’s NEC meeting.

The refinancing represents the latest chapter in Nigeria’s growing reliance on crude oil-backed financing, a funding model that has become increasingly prominent since the administration of former President Muhammadu Buhari, as successive governments sought alternative sources of foreign currency amid weak fiscal revenues, declining oil output, foreign exchange shortages and mounting infrastructure needs.

Over the past several years, crude-backed facilities have financed a wide range of government and NNPC priorities, including clearing foreign exchange obligations, refinancing legacy debt, rehabilitating refineries, supporting working capital, stabilizing NNPC’s balance sheet and meeting statutory revenue obligations to the Federation.

One of the most significant facilities was the original Project Gazelle, a $3.3 billion pre-export finance arrangement secured in 2023. The transaction played a key role in helping the Federal Government clear a substantial portion of the Central Bank of Nigeria’s inherited foreign exchange backlog owed to businesses, airlines and other investors, a move that formed part of broader reforms to restore confidence in Nigeria’s foreign exchange market after President Bola Tinubu assumed office.

The newly approved Project Gazelle 2 effectively extends and restructures that financing under more favorable terms while providing additional liquidity to support infrastructure spending and strengthen external reserves.

Finance Minister Taiwo Oyedele told the council that the revised financing terms reduce the amount of crude pledged as collateral by 12.5%, lowering daily committed volumes to approximately 78,750 barrels per day from 90,000 barrels per day under the previous agreement.

“The new terms of the facility are more favorable than the original facility,” Oyedele said, noting that the lower crude commitment would “free up resources for strategic national priorities while improving Nigeria’s financing structures.”

The revised structure is expected to provide greater operational flexibility for NNPC by reducing future crude delivery obligations while simultaneously expanding access to capital.

Crude-Backed Borrowing Has Expanded Over Several Years

Project Gazelle is only one of several oil-backed financing arrangements accumulated by NNPC in recent years. In 2024, the national oil company sought another $2 billion syndicated crude-backed loan, known as Project Leopard, to stabilize its finances and fund investments in new upstream infrastructure aimed at increasing crude oil production.

The company said the facility was designed to restore financial stability while supporting investment in oil production assets needed to reverse years of declining crude output.

The financing followed a series of earlier transactions.

NNPC secured a $935 million crude-backed loan in 2020, collateralized with 30,000 barrels per day, which was fully repaid by September 2023. A second $635 million facility was also completely repaid during the same period. The remaining exposure from that financing programme is the Project Eagle Export Funding Subsequent 2 Debt, a $900 million facility arranged in 2023 and secured against 21,000 barrels per day of crude production.

Repayment on the Eagle facility began in June 2024 and is scheduled to run through 2028. According to NNPC’s 2024 financial statements, the outstanding balance stood at approximately N1.1 trillion as of December 2024, making it one of the company’s largest remaining forward-sale obligations.

Beyond crude-backed loans, NNPC also carries sizeable obligations under other commodity-linked financing structures. One of these is the incremental gas supply financing agreement with Nigeria LNG Limited (NLNG), under which NLNG advanced approximately N772 billion against future gas deliveries.

By the end of 2024, gas worth N535 billion had been supplied under the arrangement, while NLNG had recovered N312 billion, leaving gas valued at roughly N460 billion yet to be delivered. Financing charges of N12 billion accumulated during the period, bringing the outstanding balance to approximately N472 billion.

The company’s refinery rehabilitation programme also relies heavily on commodity-backed financing. Under Project Yield, the financing vehicle supporting the rehabilitation of the Port Harcourt Refinery, outstanding drawdowns reached approximately N1.4 trillion at the end of 2024.

The arrangement requires NNPC to deliver refined-product-equivalent volumes of approximately 67,000 barrels per day, with repayments scheduled to begin after a two-and-a-half-year moratorium that expires in 2025.

Significant Share Of Nigeria’s Crude Committed To Debt Servicing

The expansion of commodity-backed financing has increasingly drawn attention from analysts because of the growing share of Nigeria’s crude production committed to servicing debt before revenues flow into government coffers.

Analysis of disclosures contained in NNPC’s 2024 audited financial statements, together with official production figures from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), indicates that Project Gazelle, Project Yield, Project Leopard and Project Eagle collectively require about 213,000 barrels of crude oil per day.

Assuming those commitments remained unchanged throughout 2025, approximately 77.75 million barrels of crude would have been dedicated to servicing these financing arrangements during the year.

NUPRC data show Nigeria produced 530.41 million barrels of crude oil in 2025. That means roughly 14.66% of the country’s annual crude production was effectively committed to servicing oil-backed financing obligations.

Using the average Bonny Light crude price of $72.08 per barrel in 2025, the volume pledged under those arrangements represents crude worth approximately $5.6 billion.

While oil-backed financing has provided Nigeria with quicker access to foreign currency than conventional borrowing, economists have frequently warned that increasing dependence on future oil production limits fiscal flexibility, particularly during periods of lower production or weaker crude prices.

The refinancing approved by the NEC therefore represents both an effort to improve financing efficiency and a recognition of the need to optimize a complex portfolio of commodity-backed obligations.

Apple has launched a fresh legal challenge against the U.K. government’s attempt to compel the company to provide access to encrypted data belonging to British users, reopening a high-profile dispute over privacy, national security and law enforcement powers.

The latest case comes about a year after a previous confrontation between Apple and the U.K. government, when authorities sought access to encrypted data belonging to both British and American users. That earlier demand was ultimately withdrawn following interventions by U.S. President Donald Trump and Vice President JD Vance, according to previous statements by former U.S. Director of National Intelligence Tulsi Gabbard.

Apple confirmed to CNBC that it has filed the new legal challenge but declined to comment further on the proceedings.

The U.K. Home Office also declined to discuss the case, but a spokesperson said: “The UK supports strong encryption and robust privacy protections, but it is also vital that law enforcement can access communications when necessary and proportionate to protect the public from terrorism, serious crime, and child sexual abuse.”

The department added that the U.K.’s Investigatory Powers Act provides safeguards and independent judicial oversight while enabling authorities to obtain access when legally justified.

The renewed legal action stems from the British government’s continued efforts to obtain access to encrypted cloud data under powers granted by the Investigatory Powers Act.

According to CNBC, the Home Office initially issued a notice in early 2025 requiring Apple to create a technical mechanism that would enable authorities to access fully encrypted material stored through the company’s cloud services. That request reportedly covered both British and U.S. users, triggering concerns in Washington over the possibility that a foreign government could compel an American technology company to weaken the security of its products.

Following diplomatic interventions from Trump and Vance, the U.K. withdrew that broader demand. However, the Financial Times later reported that the Home Office issued a revised notice in September seeking access only to encrypted data belonging to British users.

The latest legal challenge suggests Apple continues to oppose even the narrower request.

Apple has consistently argued that creating any form of government access mechanism would weaken security for all users. After the original dispute, the company disabled new enrollments in its Advanced Data Protection (ADP) service for users in the United Kingdom. Apple also said existing U.K. users would eventually have to disable the feature because it could no longer offer the service under the government’s requirements.

At the time, Apple said it was “gravely disappointed” that British customers would lose access to one of its strongest privacy protections.

“We are gravely disappointed that the protections provided by ADP are not available to our customers in the UK given the continuing rise of data breaches and other threats to customer privacy,” the company said.

Apple reiterated its long-standing position that it would never build a universal access mechanism for its products.

“As we have said many times before, we have never built a backdoor or master key to any of our products or services and we never will,” it said.

The dispute is the UK’s episode of the continuing global debate over end-to-end encryption. Technology companies believe that strong encryption protects users against cybercriminals, identity theft and state-sponsored hacking, and that introducing exceptional access for governments would inevitably create vulnerabilities that malicious actors could exploit.

Law enforcement agencies, however, contend that encryption increasingly prevents investigators from accessing critical evidence in cases involving terrorism, organized crime and child exploitation, even when they have obtained lawful warrants.

The U.K.’s Investigatory Powers Act is among the world’s most expansive legal frameworks governing surveillance and government access to communications, making Britain a focal point in the broader international debate over digital privacy.

Legal experts say narrowing the government’s request to British users may reduce diplomatic tensions but is unlikely to eliminate broader concerns in the United States.

Andrew Fremlin-Key, a partner at law firm Withers specializing in media and information law, said the original demand created a “transatlantic row” because it sought access extending beyond British citizens.

“Restricting the new notice to British users may reduce that conflict, but it is unlikely to eliminate U.S. concerns about a foreign government requiring an American company to weaken the security of its technology,” he told CNBC.

The case is being closely watched across the technology industry because its outcome could influence how governments around the world seek access to encrypted communications and cloud data.