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CBN, NBET Negotiate Fresh N180bn Fiscal Stimulus for Power Sector

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budget

The Nigerian Bulk Electricity Trading Plc (NBET) and Central Bank of Nigeria (CBN) are currently negotiating new financial stimulus worth N180 billion to support electricity operators in Nigeria’s power sector.

The paper gathered from an exclusive interview with the acting Managing Director of NBET, Mr. Waziri Bintube, at the weekend in Abuja that negotiations on the new package had advanced with the CBN favourably disposed to it.

NBET is a government agency responsible for the bulk purchase of electricity from generation companies (Gencos) for resell to distribution companies (Discos). It acts as a financial stabiliser in power trades between the Gencos and Discos.

Bintube, however, said the CBN had in addition to the N213 billion it approved in its Nigerian Electricity Market Stabilisation Facility (NEMSF) for disbursement to operators at a concessionary term, agreed to put another N180 billion into the facility.

He also said NBET had not touched its capitalisation fund, and that while the CBN expects to wrap up its first N213 billion to the market, the new N180 billion would immediately kick in.

“The NBET has a working capital, up to $350 million was given to us under the Euro bond facility and we have that amount in our kitty which we can deploy in exceptional situations. In addition, the government has given us N50 billion from its privatisation proceed on Egbin, and which we have put in our escrow account, the purpose of that is to breach the time difference when the Gencos want their money and when they can be paid.

“In addition, there are some off-the-line supports like the Central Bank’s Nigerian Electricity Market Stabilisation fund that was granted by the CBN to cover obligations in the market from the date of privatisation. That was another form of support to the market.

“We are currently negotiating with the CBN again to come in with a second tranche. They have some amount that they are yet to disburse but even after that, we are looking at getting the board to approve another second tranche on top of the N213 billion that has already been approved. We are looking at about N180 billion,” said Bintube.

Asked if the negotiations have largely being positive, he said: “Yes, we have the assurance of the CBN governor. He is very dedicated to resolving the logjam and ensuring that all the key pillars of the economy work because they are interrelated.”

He added: “If the power plants work, the manufacturers will have lesser problems, the banks will get paid for their products and then there will be less need for foreign products to come in and that reduces the request for foreign exchange. Just imagine that if our refineries are working, we will not need to depend on importation which takes away a lot from us including profits and jobs.”

Bintube also disclosed that NBET in conjunction with United States’ President Barack Obama’s Power Africa Initiative, recently trained key government agencies and officials involved in evaluating, reviewing and regulating power projects in the country on understanding Power Purchase Agreements (PPAs) and Put Call Options Agreements (PCOAs).

He said the training was done to help the agencies and its officials understand the contents and significance of the PPAs and PCOAs considering that they would always have to come across it for review and approvals for investors who are interested in building power plants in Nigeria.

According to him, the ministries of power, finance, justice and Bureau of Public Procurement (BPP), as well as the Nigerian Electricity Regulatory Commission (NERC) and Nigerian National Petroleum Corporation (NNPC) were some of the agencies that were trained on the use of the industry documents.

“Over the past several months, NBET has been negotiating PPAs and PCOAs with numerous gas and solar independent power project developers who are actively developing utility scale projects which will create circa 5,000 megawatts of new generation capacity for the country.

“The NBET PPA-PCOA training was designed to familiarise key government officials with the PPA and PCOA documents which will then be submitted to their respective offices for approval,” Bintube added.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Government

Zabarmari Massacre: Buhari to Provide More Resources for the Nigerian Military

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President Muhammadu Buhari

President Muhammadu Buhari has promised to provide more resources to the military in the aftermath of the Zabarmari massacre.

On Saturday, Boko Haram killed 43 people with around 70 people still missing in Zabarmari, a village in Borno State.

Reacting to the massacre, Buhari, through his official Twitter handle @MBuhari said “Nothing is more important than ensuring the security of lives and property of Nigerians. Everything is secondary when security is at stake. I will ensure that more resources are made available to the military and other security agencies to prosecute the war against terrorism.

“As we mourn all the lives lost in Zabarmari, the Armed Forces have been given the marching order to take the fight to the insurgents, not on a one-off, but on a continuous basis, until we root out the terrorists.

“We will intensify our cooperation with neighbouring countries on bilateral and multilateral levels, to ensure that there is no hiding place for the terrorists.

“As I noted earlier, the massacre by Boko Haram in Zabarmari is nothing short of senseless, barbaric, gruesome and cowardly. It reinforces our resolve to root out all forms of insurgency and insecurity not just in Borno but everywhere across Nigeria.”

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Government

Boko Haram Kills Rice Farmers in Borno State, Northeast Nigeria

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Rice farmers were killed on Saturday morning in the Northeast Nigeria by suspected Islamist militants, Boko Haram, according to a Reuters Report.

The report also noted that 30 of the people killed were beheaded while over a dozen others were still missing.

However, resident of the Zambarmari Village where the attacks took place said a total of 70 people were feared dead.

Another resident and Amnesty International were quoted as saying at least 10 women were among those missing.

In another statement by Edward Kallon, the United Nations’ humanitarian coordinator in Nigeria, it was armed men on motorcycles that led the brutal attack on civilians harvesting their fields.

Armed men on motorcycles led a brutal attack on civilian men and women who were harvesting their fields,” Edward Kallon stated.

“At least 110 civilians were ruthlessly killed and many others were wounded in this attack,” he added, noting that several women are believed to have been kidnapped.

“The incident is the most violent direct attack against innocent civilians this year. I call for the perpetrators of this heinous and senseless act to be brought to justice,” Kallon said.

On Sunday, Governor Babaganan Umara Zulum of Borno State, who was at the burial told journalists that at least 70 farmers were killed on Saturday.

The Governor, therefore, called on the Federal Government to recruit more Civilian Joint Task Force members, Soldiers and civil defence fighters to protect farmers in the region.

He added that people are facing desperate choices.

In one side, they stay at home they may be killed by hunger and starvation, on the other, they go out to their farmlands and risk getting killed by the insurgents,” he said.

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In The Fight Against Corruption, No Individual is Bigger Than The State – Buhari

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Muhammadu Buhari

In response to the suspended acting EFCC Chairman, Ibrahim Magu, President Muhammed Buhari, lamented that the anti-corruption war becomes endangered “when persons entrusted with the responsibility of that magnitude become suspects themselves.”

Buhari, whose vision is to put an end to corruption in Nigeria, believed that every aspect of the nation’s life is enshrined in corruption and it’s of major concern when leaders of institutions saddled with the mandate to fight the menace are found in the waves of the corruption they claimed to be fighting.

This act is a great abomination not only because it strikes at the root but it also trivialises and undermines the anti-corruption crusade itself, the President explained.

He further said that in a bid to put an end to this great abomination, he had set up Ayo Salami Panel to unravel the mystery behind the mystique of Magu’s alleged involvement in corruption that his administration is fighting.

Buhari said that his administration is ready and willing to go all out in the fight against corruption, and no one is too big nor above the law to become a victim of anti-graft’s sledgehammer.

The president said, “However, the stark reality of widespread corruption becomes poignant when allegations of corruption touch on the leadership of an institution set up by law to coordinate and enforce all economic and financial crimes.

“It is an abomination that strikes at the root and undermines the government’s anti-corruption programme.

“It was in response to the serious allegations against the Economic and Financial Crimes Commission that I set up a panel headed by the Honourable Justice Isa Ayo Salami, retired President of the Court of Appeal, via an Instrument dated 3rd July 2020 pursuant to the Tribunals of Inquiry Act (Cap T21, LFN, 2004).

“We recognise that there are more grounds to cover in the war against corruption, and we are prepared to go out to possess those lands by cutting off any stream that nourishes the seed of corruption and supports its growth.

“Let it be known that in the fight against corruption, no one is too big to tackle, as no individual is bigger than the Nigerian State!”

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