The Federal Government will make about $1.6bn from the sale of 10 electricity generation plants under the National Integrated Power Project once the ongoing process for their sale is successfully completed.
It was learnt that about $4bn had so far been invested in the 10 power plants by the Niger Delta Power Holding Company, while the preferred bidders had offered to pay $5.6bn for the facilities.
It was further gathered that the NDPHC had also spent about $1.5bn on distribution assets, while $2bn had so far been invested in transmission infrastructure.
The Managing Director, NDPHC, Mr. Chiedu Ugbo, told the press on the sidelines of a power stakeholders’ meeting that a lot of projects had been put in place by the company in order to enhance generation and distribution of power across the country.
He explained that the $5.6bn offer from investors for the 10 NIPP generation plants was for 80 per cent equity in the facilities, adding that the Federal Government had mandated his team to provide power to Nigerians.
When asked the total worth of investments in the NIPPs, Ugbo said, “We have about $4bn in generation in 10 power plants. There’s always a confusion as to how much we are selling these power plants. We received a total offer of $5.6bn from investors for the 10 power generation plants, but the cost of developing these projects is about $4bn.
“For the power distribution projects, we’ve spent about $1.5bn so far. On transmission, over $2bn has been spent. So, if you look at all of it, we are somewhere in the neighbourhood of $8.5bn and the projects are there to see.”
He added, “For instance, the Ikot Ekpene switching station, which runs from Ikot Ekpene to Jos, comprises of transmission lines and there are transmission substations too along the way. There are also other masterpiece substations and there quite a lot of projects that the company has done in the space of 10 years on power infrastructure.
“The $5.6bn offer that we received is for 80 per cent of the shares of the generation assets alone and not every investments we have made. The acquisition exercise went through a competitive process; we called for expression of interest, people expressed interest and were evaluated.”
Ugbo said investors who met the requirements were asked to prepare their technical and financial proposals.
According to him, the technical proposals were opened and evaluated, and those who met the benchmark moved to the next stage where their financial proposals were opened.
“It is from the financial proposals that we received from the preferred bidders that we were able to come up with a total sum of $5.6bn for the generation companies,” he said.
Ugbo explained that the decision to sell the NIPPs was taken by the Federal Government and that the transaction for the sale of the power plants had advanced substantially.
He said, “The mandate from the government is to privatise. In fact, it started before this administration came on board and this government has continued with it. The transaction has advanced substantially, although we have a few market issues but we are devising means to get round these issues and complete the transactions.
“Investors are willing, ready and available. They just want the government to settle a few things and we are working on that. We are ensuring that their demands, which are reasonable, are met. Also, we don’t want them to take advantage of the consumers by asking for what is inordinate.
“So for the inordinate demands, we’ve told them that we are not part of the transactions we can’t guarantee. But for the reasonable demands, we are working to meet them and to close these transactions.”
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