Another round of negotiations between Chad and Glencore Plc to restructure an over US$1 billion oil-backed loan ended this week without any agreement, Reuters reported Dec. 20, citing a source.
The discussions between the parties will continue, but they had hopes that this latest round would finally result in an agreement.
Glencore lent the West African country's state oil company SHT about US$1.45 billion in 2014 to be repaid with crude oil, with the loan subsequently syndicated with several banks. The loan was restructured in 2015 after global oil prices collapsed, but Chad is struggling to repay the debt.
The two sides previously met in Paris in early November for talks which ended without any agreement. Chad's finance minister was sacked the following week.
According to the source, Chad is seeking a longer maturity of 12 years and a lower interest rate of 5%.
Glencore and the other lenders previously offered to extend the loan maturity to 2025 from 2022 and include a grace period on the principal, among other concessions. The interest rate and Glencore's commission, however, remain sticking points in the discussions, as the commodities trader seeks to maintain a 6.75% interest rate.