Chad Signs Deal With Glencore After Review of $1 Billion Debt

Chad signed a deal with Glencore Plc to restructure more than $1 billion in debt in an agreement that will help the African nation to avoid a financial crunch, Bloomberg News reported. The review was signed on Wednesday and is a “good outcome” for Chad, Guillaume Foucault, a spokesman for the country’s national oil company, said by phone from Paris. Under the terms of the agreement, the loan’s maturity is extended to 12 years while Chad will receive a grace period of two years, said Foucault. The rate on the loan is also reduced to the benchmark Libor interest rate plus 2 percent, from Libor plus 7.5 percent, while Glencore will guarantee the supply of oil for Chad’s domestic refining requirements for the duration of the contract, he said. Glencore and its banks agreed in late 2015 to restructure two oil-for-cash loans with Chad, dating from 2013 and 2014, extending the repayment to seven years from an initial four years. Glencore initially lent the African country $600 million in 2013 through a so-called pre-payment export deal, in which a nation receives an advance on its oil sales and repays the debt by allocating crude cargoes to its creditors. Read more.