CBN Grants Oil Firms Full Access To Export Forex Proceeds

The Central Bank of Nigeria (CBN) has approved the full repatriation of export proceeds by international oil companies (IOCs), allowing them to access 100 per cent of their foreign exchange earnings through authorised dealer banks.

The directive was conveyed in a circular issued by the apex bank’s Trade and Exchange Department on Wednesday, underscoring ongoing efforts to liberalise Nigeria’s foreign exchange market and improve liquidity conditions.

The circular, signed by the department’s Director, Musa Nakorji, stated that the decision forms part of broader reforms aimed at strengthening the FX market and enhancing stability.

Under the new policy, oil companies are now permitted to repatriate the entirety of their export proceeds without restrictions, marking a significant shift from the previous framework introduced in 2024.

The CBN explained that the earlier arrangement allowed authorised dealer banks to pool 50 per cent of repatriated export proceeds on behalf of IOCs, while the remaining 50 per cent was held for 90 days before it could be accessed.

“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 (ADBs) to cash pool 50% of repatriated export proceeds on behalf of International Oil Companies (IOCs) with the remaining 50% retained for 90 days before repatriation,” the bank stated.

However, the apex bank said the latest directive represents a move to fully liberalise the system in line with evolving market 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 IOCs may repatriate 100% of their export proceeds through the ADBs, who shall ensure adequate documentation and submit a monthly report to the Director, Trade & Exchange Department,” the circular added.

The CBN clarified that the new guideline supersedes all previous instructions relating to cash pooling arrangements for oil companies, effectively dismantling the phased repatriation structure introduced last year.

Authorised dealer banks have been directed to comply with the new directive immediately, including ensuring proper documentation of transactions and submitting periodic reports to the regulator.

The development removes earlier restrictions that required oil firms to stagger access to export proceeds and obtain regulatory approvals for certain transactions.

The move is expected to ease operational constraints for IOCs, boost confidence in the foreign exchange market and support the CBN’s broader objective of improving liquidity and attracting foreign inflows into the economy.