LAGOS (Reuters) – Nigeria has asked Goldman Sachs and the local unit of South Africa’s Standard Bank to advise it on the sale of a debut “diaspora bond” targeted at Nigerians living abroad, Stanbic IBTC Bank said on Monday.

Such bonds are a form of government debt that targets members of the national community abroad and Africa’s biggest economy first announced plans to sell them in 2013 to raise between $100 million to $300 million.

Goldman Sachs and Stanbic were due to manage the sale at the time, but the government then did not appoint any bookrunners before an election in 2015 that brought President Muhammadu Buhari to power.

Nigeria is in its first recession in 25 years and needs to find money to make up for shortfalls in its budget. Low prices for crude and militant attacks in its oil-producing heartland, the Niger Delta, have slashed its revenues.

A finance ministry source told Reuters this month that the country will look to issue a diaspora bond after completing a $1 billion eurobond sale.

(Reporting by Chijioke Ohuocha; Editing by Alexander Smith)

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By Asma Alsharif

CAIRO (Reuters) – Egypt may issue bonds in other international currencies after successfully selling $4 billion of Eurobonds last week, Finance Minister Amr El Garhy said on Sunday.

He told a news conference that potential issuing currencies included the Japanese yen and China’s yuan but that it was too early to say when or how much Egypt might seek to borrow.

Egypt sold $4 billion of Eurobonds in three tranches on Tuesday, raising twice as much as targeted and at lower yields than initially expected.

The combined order books for the five-, 10- and 30-year bonds exceeded $13.5 billion, which bankers said should mean demand is there for further bond sales.

“If (Egypt) decides in 2017 to issue more external debt it will be able to do so because (Tuesday’s) issuance was covered 3.5 times,” said one banker, who declined to be named because he is not authorised to speak to media.

“That on its own shows there is a lot of appetite.

“The appetite is mainly driven by the economic reforms happening in Egypt combined with the lack of investment opportunities abroad that have similarly high yields,” he added.

Another banker said bigger-than-expected demand for the 30-year bonds had been a surprise and showed confidence is growing in Egypt’s long term stability.

Six years after a popular uprising drove away tourists and investors, both major sources of foreign currency, the country of over 90 million people is struggling with an acute shortage of dollars. To meet its financing needs, it has sought funding from a variety of sources, from development loans to foreign grants and aid.

Tough economic reforms, including floating its currency, which roughly halved the value of the Egyptian pound overnight, and a three-year, $12 billion International Monetary Fund programme have helped reassure foreign investors.

Economists say Egypt faces debt repayments of about $11 billion next year.

Allen Sandeep, head of research at Naeem Brokerage, said Egypt’s external debt to GDP ratio of 18 percent – much lower than major emerging market countries like India or Russia – meant it had scope to raise more funding internationally.

“If we look at a comfortable level of 25 percent of GDP, that would give Egypt room to borrow at least $20-25 billion more through international bonds,” although it was likely to have to pay more to borrow than at last week’s sale, he said.

(Editing by Catherine Evans)

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** Algerian state energy company Sonatrach said on Sunday it has set its Saharan Blend official selling price (OSP) for February 2017 loadings at dated Brent flat.

** Algeria has set its January OSP at a 26 U.S. cents premium to the benchmark.

(Reporting by Rania El Gamal; Editing by Susan Fenton)

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LAGOS (Reuters) – General Electric Co has proposed investing in Nigeria’s oil refineries, potentially convening a consortium of companies to improve capacity at the run-down facilities.

GE’s plan and similar promises from companies like Italy’s Eni to work with Nigeria to rehabilitate the country’s three oil refineries could help the government as it tries to reduce costly imported oil products.

The work was raised during a meeting with the Nigerian National Petroleum Corporation (NNPC), a GE spokeswoman said late on Tuesday.

“We propose that work commences either with the Warri or Port Harcourt refinery as a pilot, as we set a target to improve the refinery capacity before the end of 2017,” GE told the NNPC, according to a statement from the state oil firm.

Imports are consuming a large portion of the nation’s scarce foreign currency, but the run-down state of the refineries themselves, which are also subject to frequent pipeline attacks, has hampered progress.

Nigeria’s Minister of State for Petroleum Resources, Emmanuel Ibe Kachikwu has said that Chevron and Total were also interested in working on the refineries.

GE and NNPC could also cooperate on national power projects, said the Nigerian firm, as the country remains plagued by cuts and shortages and a creaking power grid.

(Reporting by Ulf Laessing; Writing by Paul Carsten; Editing by Alexander Smith)

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LUANDA (Reuters) – Angola’s public debt is projected to narrow to 62.8 percent of gross domestic product in 2017, from 71.6 percent last year, the International Monetary Fund said late on Tuesday.

Weaker oil prices in the last three years has constrained growth and put state finances under pressure in Africa’s second- biggest crude producer.

“…continued fiscal adjustment will be needed going forward to put public debt on a clear downward path while supporting economic growth over the medium term,” the IMF said in a statement after the IMF team met government officials.

The fund urged Angola, where banks grapple with liquidity and foreign currency shortages, to phase out exchange restrictions and multiple currency practices.

It also said the southern African nation should more forcefully address its dependence on oil and diversify the economy.

(Writing by TJ Strydom; Editing by Jacqueline Wong)

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By Ahmad Ghaddar and Julia Payne

LONDON (Reuters) – Egypt is committed to repaying the $3.5 billion it owes in arrears to foreign oil companies but a foreign currency shortage has made the drawing down of those debts more difficult, Petroleum Minister Tarek El Molla said on Tuesday.

“We are committed and we will continue decreasing the numbers as we have done over the last three years,” El Molla told Reuters.

Insufficient foreign currency reserves mean that the repayment schedule was taking time, he said.

He said, however, Cairo was making monthly payments to foreign operators, enabling it to prevent overall debts from growing further.

El Molla said Egypt would resort to the spot market and to inter-governmental deals to close the gap between its gas production and consumption through imports of liquefied natural gas.

State-run EGAS issued an import tender in late October for 96 LNG cargoes for delivery in 2017 and 2018, with an option to buy 12 additional cargoes in 2017.

“As we go during the course of the year, we will see what are the remaining quantities that we need to close the balance of the month and the balance of the season,” he said.

“Therefore, we’ll go on as we need and as it may require on smaller tenders or we might have some direct [inter-governmental] deals.”

Once a net gas exporter, Egypt turned into a major importer of LNG as growing demand outstripped production.

The country is currently producing 4.45 billion ft3 of gas a day, El Molla said.

But the discovery by Eni of the giant 850 billion cubic meters Zohr oilfield in 2015 is likely to transform its fortunes.

The field is expected to come into production at the end of the year and will save Egypt billions of dollars in hard currency that would otherwise be spent on imports.

Egypt scrapped plans for a third floating and storage regasification unit (FSRU) due to plans to increase its natural gas production.

“We were able to squeeze the time, accelerate development then bringing into stream more gas, hence there’s no need for a third FSRU,” El Molla said.

El Molla said Egypt was still on track to conclude a contract with Iraq to import 1 million to 2 million barrels per day of crude from Iraq through an inter-governmental deal by the end of the first quarter.

The country will continue to go to the spot market to import oil products, however.

The move follows Saudi Arabia informing Egypt in November that shipments of oil products expected under a $23 billion aid deal had been halted indefinitely.

Egypt has long-term contract with Kuwait’s KPC to import diesel and crude oil, he said.

(Reporting by Ahmad Ghaddar and Julia Payne; editing by Jason Neely and Angus MacSwan)

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LONDON (Reuters) – Royal Dutch Shell said its operations in Gabon were running as normal after it struck an agreement with staff, their labour union and the government to end strike action which started on Jan. 12.

“The agreement has immediate effect and operations are running as normal,” a Shell spokeswoman said.

Shell workers in Gabon, where it produces about 55,000 barrels per day (bpd) of oil, protested against potential redundancies from Shell’s plan to sell its Gabon business.

(Reporting by Karolin Schaps; editing by Jason Neely)

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JOHANNESBURG (Reuters) – Anheuser-Busch InBev, the world’s largest brewer, has offered more than 1,000 employees in South Africa voluntary severance following its merger with SABMiller, the Business Day newspaper reported on Monday, citing an internal memo.

AB InBev bought nearest rival SABMiller for 79 billion pounds ($98.23 billion) last year in one of the largest corporate mergers in history and taking the company into Africa for the first time.

As part of the merger conditions, AB InBev was required to maintain the number of employees in SABMiller’s South African operations for five years after the date of the merger and not implement forced retrenchments.

The paper said AB InBev could not confirm the number of job cuts it was targeting through the voluntary severance, which has only been offered to management employees.

Spokeswoman Robyn Chalmers did not respond to telephone requests for comment but she is quoted in the paper confirming that Ab InBev has started the programme.

“The voluntary severance offer, which is entirely voluntary, has been made available only to mid-level employees and above,” Business Day quoted her as saying. “We understand that during this period of change some employees may wish to voluntarily exit the business, which is why we have introduced a voluntary severance offer.”

($1 = 0.8042 pounds)

(Reporting by Olivia Kumwenda-Mtambo)

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LONDON (Reuters) – Mozambique’s default on a coupon payment for its dollar-denominated bond last week was “unnecessary” and a step backwards for the country’s relationship with the holders of the debt, a group of creditors said in a statement on Monday.

Mozambique announced a week ago it would not make the $59.8 million payment to holders of its 2023 bond due on Jan. 18 because A deteriorating economic and fiscal situation made its ability to repay debt this year extremely limited.

“This development is a retrograde step for the prospects of Mozambique engaging in good faith negotiations with bondholders,” the Committee of Mozambique’s Bondholders said in a statement.

“The default was unnecessary, given the improvement since October in Mozambique’s economic and financial situation,” the statement said. It added that Maputo was continuing to service other external debt, which signalled “a strategic default targeted at the bondholders.”

The committee was formed in November and includes AllianceBernstein, Franklin Templeton Investment Management and Greylock Capital Management as well as NWI Management and Pharo Management. It says it represents 60 percent of the holders of Mozambique’s so-called “tuna bond”.

The southern African country, one of the world’s poorest, has seen its currency and investor confidence collapse since April, when the International Monetary Fund (IMF) halted a loan after uncovering previously undisclosed debts. The additional debt burden came to light only days after bondholders had agreed to a restructuring.

In its statement, the committee reiterated there was nothing to negotiate until it saw an international audit of state firms’ loans requested by the IMF and an outline of what sort of engagement the fund would envisage going forward.

It also repeated that Mozambique needs to accept “intercreditor equity” – referring to equal treatment for loan and bond creditors as well as bilateral lenders.

“While negotiations are premature, the committee has been prepared to discuss its views and analysis of all aspects of the situation facing Mozambique. To date, neither the government nor its advisors has engaged with the committee on such initial discussions,” the statement said.

On Friday, Fitch said Mozambique’s failure to pay the interest on the bond pointed to an extended period of uncertainty.

(Reporting by Karin Strohecker; Editing by Paul Simao)

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