Trafigura Group, a global leader in the commodities industry, announced the signing of a USD1 billion prepayment agreement with the Republic of Gabon.

Under the agreement, Trafigura will provide the prepayment to the Republic of Gabon in exchange for the future delivery of crude oil over a seven-year term. Trafigura will act as exclusive offtaker of the Republic of Gabon’s Profit Oil for the duration of the agreement.

The oil underpinning the prepayment comprises production from across petroleum sharing contracts and draws on a diversified pool of producing assets and operators, providing a resilient production base across a range of fields. The proceeds will be deployed by the Republic of Gabon to advance its development agenda.

As one of Africa’s largest producers and exporters of crude oil, Gabon plays a critical role in supplying energy to global markets. Trafigura has a long-standing trading relationship with the Republic of Gabon, including the supply and export of refined products and the export of crude oil.

This agreement builds on Trafigura’s established track-record of providing structured financing and logistics solutions to sovereign and corporate counterparties across emerging and developed markets to support long-term economic development goals.

Trafigura has commenced a syndication process to distribute a portion of the exposure among international financial institutions, reflecting strong market appetite for the transaction.

Dave Gallagher, Global Head of Structured Finance at Trafigura, commented: “We are pleased to have signed this agreement with the Republic of Gabon, continuing our long-standing trading relationship and contributing to the country’s development agenda. This milestone prepayment underscores Trafigura’s commitment to long-term collaboration with resource-rich nations and our ability to structure innovative, large-scale financing solutions.”

Thierry Minko, Minister of Economy, Finance, Debt & State Holdings for the Republic of Gabon, with responsibility for tackling the cost of living, commented: “The Republic welcomes the strong return of Trafigura to Gabon and thanks the company for this agreement, which aims to optimise the country’s oil resources, strengthen the foreign exchange reserves of the Central Bank, and facilitate the proactive management of the nation’s treasury. The State extends its warm congratulations to the strategic, financial, and legal advisors, namely Algest, Rothschild & Co, Mayer Brown, Adna, and Bracewell LLP, for the remarkable work accomplished in record time.”