CBN Gives Condition for Chevron, Other International Oil Companies to Repatriate Export Proceeds

• The Central Bank said Nigerian banks will no longer repatriate complete proceeds of international oil companies
• This occurred as proceeds of crude oil exports by IOCs are transferred to fund parent account of the IOCs
• The apex bank stated that this is part of its effort to develop policies to stabilise and further deepen the market

Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.

The Central Bank of Nigeria has stopped international oil companies (IOCs) from repatriating 100% of their crude oil export proceeds.

It said this in a circular signed by Dr Hassan Mahmud, director of the trade and exchange department.

Based on the directive, banks are allowed to pool cash on behalf of IOCs, subject to a maximum of 50% of the repatriated export proceeds.

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In addition, the balance of 50% may be repatriated after 90 days from the date of inflow of the export proceeds.

Why the directive is important

The directive was necessitated after the CBN observed that the proceeds of crude oil exports by international oil companies (IOCs) operating in Nigeria were transferred to the fund parent account of the IOC.

According to the CBN, this impacts domestic foreign exchange market liquidity.

It stated,

“While CBN strongly supports the need for IOCs to have easy access to their export proceeds, particularly to meet their offshore obligations, this must be done with a minimal negative impact on liquidity in the Nigerian foreign exchange market.

The apex bank said it remained committed to promoting transparency in the Nigerian foreign exchange market and will continue to develop policies to stabilise and further deepen the market.

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It also urged all banks to comply with this circular and inform their customers accordingly.

CBN sets new customs exchange rate

Legit.ng reported that the Central Bank of Nigeria (CBN) has raised the exchange rate used to calculate customs taxes at the country's seaports for the sixth time this year.

On Thursday morning, February 15, 2024, the rate was revised and increased, going from N1, 481.482/$ to N1515.092/$.

On Thursday, February 15, 2024, the new rate was announced on the Nigeria Customs Service's official trade portal.

Source: Legit.ng