The Central Bank of Nigeria (CBN) has approved full access to export proceeds for international oil companies, allowing them to repatriate 100 per cent of their foreign exchange earnings through authorised dealer banks.
The directive was issued in a circular released on Wednesday by the apex bank’s trade and exchange department, as part of ongoing reforms aimed at boosting liquidity and stabilising the foreign exchange market.
Signed by Musa Nakorji, the director of the department, the circular stated that the decision marks a shift from the bank’s 2024 policy, which required oil firms to retain part of their earnings before full repatriation.
It said, “As part of the reforms aimed at creating more liquidity and stability in the Nigerian Foreign Exchange Market, the Bank issued two circulars in 2024, allowing authorised dealer banks to cash pool 50 per cent of repatriated export proceeds on behalf of International Oil Companies with the remaining 50 per cent retained for 90 days before repatriation.”
However, the apex bank noted that the latest adjustment is intended to further liberalise the market in line with prevailing conditions.
“However, to further liberalise and deepen the market in line with current market realities, IOCs are hereby granted unfettered access to their repatriated export proceeds,” the circular read.
It added that, “The IOCs may repatriate 100 per cent of their export proceeds through the ADBs, who shall ensure adequate documentation and submit a monthly report to the Director, Trade & Exchange Department.”
The CBN also made it clear that the new directive overrides all previous guidelines on cash pooling arrangements for oil companies.
“Please note that this provision supersedes all other circulars issued by the Bank on Cash Pooling,” it stated.
The bank directed all authorised dealer banks to comply with the new framework immediately.
“All authorised dealer banks are to note and be guided accordingly, as this directive takes immediate effect,” the circular added.
In 2024, the CBN introduced measures affecting international oil companies operating in Nigeria, limiting their ability to immediately remit 100 per cent of forex proceeds to their parent companies abroad.
Instead, IOCs were required to repatriate 50 per cent of their proceeds immediately, with the remaining 50 per cent to be repatriated 90 days after the inflow.
Also, the CBN implemented new rules governing cash pooling by IOCs. These rules required prior approval from the CBN for repatriation under the cash pooling framework, alongside detailed statements of expenditure incurred before pooling.
The apex bank further clarified these measures, allowing IOCs to pool 50 per cent of their export proceeds while using the remaining funds to settle financial obligations within Nigeria over 90 days.
IOCs were also permitted to sell the 50 per cent balance of their repatriated proceeds to authorised foreign exchange dealers.
