VP Orders Immediate Settlement of All Power Subsidy and Monetisation Issues

The Vice President, Arc (Dr) Mohammed Namadi Sambo, has directed the Ministries of Power and Finance to settle all outstanding subsidies in the power sector and monetization claims of the workers of the Power Holding Company of Nigeria (PHCN) in order to make way for smooth privatisation of the company.

 

Speaking today during the update of the Presidential Task Force on Power in the State House in Abuja, Dr. Sambo asked the Ministry of Finance to release about N5.4 billion power subsidy that has not been paid since 2009.  He also urged the Ministry of Power to clear all monetization arrears for the members of staff of the Power Holding Company, as these are impeding the privatisation of the power sector.

Dr. Sambo also urged Ministry of Petroleum and Nigerian National Petroleum Corporation (NNPC) to do more on the gas sector by opening up the sector for more private investors to participate as this will serve as a long time measure for availability of gas for electricity generation.  He said “ninety per cent of the power plants are completed but a major challenge is the availability of gas.  Although some companies are ready to provide gas to the power plants especially the Alaoji power plant, there is no evacuation.”

He disclosed that “the Commonwealth Business Council is ready to invest $20 million in the power sector in the next two weeks.”  The British government has also decided that its companies invest in various business sectors in the country, he added.

In his briefing, the Minister of State for Power, Nuhu Wya, said “the average of 3,500MW of electricity has been dropped to 3,000MW due to the accident that occurred and right now power generation is at 3,339MW as the incident has been resolved”. He added that “with the progress so far made and the attendant variables on ground, all things being equal, it is hoped that by December, 5,974MW would be achieved.”

He also said that the Ministry has paid N50,073,448,553.87 monetization to 40,634 of staff of PHCN representing eighty-nine per cent of the staff and 992 staff are yet to be cleared for payment due to internal problems including death of some members.  Wya said projects ready for commissioning before the end of the year are Afam VI Power plant with the capacity of 650MVA and Ayede (Ibadan) Power Plant with 150MVA capacity.

The Presidential Task Force in its presentation, decried lack of corporation of successor companies which slows down the privatisation process and said the outstanding payment of tariff subsidy to market operations account for the past thirteen months threaten stability and commercial viability.  On fuel-to-power project, it disclosed that gas supply from PANOCEAN has commenced and risk mitigation following the Utorogu power shut down has been put in place.

In a related development the Vice President during a meeting on the 215mw Kaduna Thermal Power Plant with the Ministry of Power, contractors, consultants and relevant stakeholders, consented to the work plan of the Ministry for the construction of a 132 substation and the 330 kva Power line to service Kaduna and the industrial area, noting that the project was conceived to address a specific request of revival of the moribund industries in the industrial area of Kaduna.

He further directed the Ministry to write to General Electric on the need for an Engineer to be on the site.  He also charged the Ministry to plan for the insulation of the 132 substation.

Arc Sambo stated that the industrial area requires only 156mw and that funding arrangement through letters of credit issued had reached between 80-90 % and therefore he does not anticipate any hindrance.  He disagreed with the proposed 24 months completion period and insisted that it must be completed within 12 months.

Earlier the Ministry of Power and the Consultants to the project STEAG briefed the Vice President on the progress of the Kaduna 215mw Thermal Power project.  The Minister, Mr. Nuhu Waya said that the project consists of 8 x 26.88 General Electric frame, 6 Gas Turbines with a combined install capacity of 215mw (ISO) and 173.6mw (site condition).  The contract was awarded in favour of a consortium of GE/Rockson Engineering JV in the sum of ?135,840,665.71 plus N6B with a completion period of 24 months.

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