Congo Republic seeks Glencore loan deal within a year, says oil minister

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CAPE TOWN, Nov 9 (Businesshala) – The Republic of the Congo aims to seal a deal to restructure an $850 million loan from global commodities trader Glencore within the next year, the country’s oil minister told Businesshala on Tuesday.

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If it fails to reach an agreement with Glencore, the Republic of the Congo will consider seeking a third party to buy the loan, Oil Minister Bruno Jean-Richard Itoua said on the sidelines of the African Energy Week conference in Cape Town.

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Glencore and a consortium of banks gave an $850 million loan to the Republic of the Congo between 2015 and 2016, to be paid with future oil deliveries over five years. The country has been discussing debt restructuring with the trader since 2018 and has suspended oil cargoes to Glencore.

“I haven’t lost hope that we will find a solution with Glencore,” Itoua said. “The time is ripe… we hope we don’t have to wait a year to get to the end of it all.”

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Glencore did not immediately respond to a request for comment.

The International Monetary Fund (IMF) said on Monday it has agreed a three-year loan program worth about $456 million to help stabilize the debt-ridden economy of the Republic of Congo.

Itoua said the program would help the country’s position with Glencore.

The IMF’s help rested on the Republic of the Congo’s ability to restructure its debts. China announced in June that it had agreed in principle to reschedule its $2.4 billion loan to the country, and Trafigura finalized the restructuring of an oil-backed debt in March.

The Republic of Congo has set a target of about 246,575 barrels per day (bpd) of oil production this year, which will increase to 301,370 bpd in 2022 and 342,466 bpd in 2023.

The country currently has 12 offshore blocks open for bidding and is looking for new investors to develop its gas resources.

“Gas is the key word at the moment,” Itoua said.

Itoua said the Republic of the Congo is also looking at creating a sovereign wealth fund to invest any surplus oil revenue in the coming years.

Reporting by Helen Reid in Cape Town Additional reporting by Julia Payne Editing by David Goodman

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