Connect with us

Markets

N6bn Power Transmission Projects Stalled Amid Funding Challenge

Published

on

electricity
  • N6bn Power Transmission Projects Stalled Amid Funding Challenge

Power transmission projects worth about N6bn have remained stalled in the past few years due to lack of government funding, even as the nation seeks to achieve incremental power supply.

The nation’s power generation and distribution companies were privatised in November 2013, but the transmission segment of the value chain was left in the hands of the government.

Since 2002, a total of 130 projects across the country had yet to be completed, the Managing Director, Transmission Company of Nigeria, Dr. Atiku Abubakar, said at a forum held by Eko Electricity Distribution Company Plc in Lagos, with members of the House of Representatives’ Committee on Power in attendance.

He said the nation’s power grid continued to experience collapse as a result of low spinning reserve.

Abubakar said, “In the TCN, we have over 130 big projects, from 330KV to 132KV to associated substations, from 2002. But they have not been completed due to lack of funding from government. For three years’ budgets now, nothing has been allocated for the projects.

“Year in year out, we made provisions for the projects in the budget, but they were removed for reasons we don’t know. In 2015, the power sector had only N1bn allocation; and these projects are worth N5bn to N6bn. They are over 60 to 70 per cent completed; we have all the materials on the ground.”

He said the contractors could not continue the project because payment had not been made, adding, “We hope this year, we will be able to fund the projects so that they will be completed within one year or one and a half years.”

The TCN MD noted that the issue of gas constraints had worsened power supply in the country.

He said, “Principally, that (gas shortage) is what is drawing us back. If you recall in February, we reached 5,074 megawatts, which was the highest ever generated in Nigeria. But now, we are hovering between 3,000MW and 3,200MW.

“We are hopeful that the situation will improve and we will get improvement in generation. Once we are generating anything below 3,000MW, nobody can guarantee the grid stability. That is, system collapse is bound to happen.

He decried the lack of adequate spinning reserve to forestall system collapse, saying, “Sometimes we have 15MW, 20MW and 36MW as spinning reserve. So if you lose 300MW, what can that do in order to quickly rise up and protect the system; you will lose the system. So, that is the issue. But we are trying as much as possible to avoid system collapse.”

The Managing Director, EKEDC, Mr. Oladele Amoda, said when the private investors came in after the privatisation of the sector, power generation was around 3,000MW, adding, “Our demand in Eko is between 700MW and 1,000MW. The best we have got was 500MW, and that was around February.”

He said the gas pipeline vandalism was militating against the drive for incremental power.

Noting that the sector had suffered huge neglect before the privatisation, Amoda said more than 70 per cent of their customers did not have functional meters and the situation was not peculiar to the EKEDC.

He said, “The investors put measures in place to rehabilitate and upgrade the assets. We went to the banks to get loans so as to sustain the network. We purchased a lot of transformers and provided meters to many of our customers.”

The Chairman, House of Representatives Committee on Power, Mr. Dan Asuquo, said, “One thing I think my colleagues and I are taking back is the level of enlightenment and concern, which Nigerians have shown to get better quality service for what they pay for. I think we have an increased agitation for better service for what they pay for.”

He said the committee was monitoring the performance of the power firms to ensure Nigerians were not exploited in any way and to get value for their money.

He noted that the power sector had been denied measurable investment in the last 30 years, saying, “The decay is very much.”

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.

Markets

SEC To Ban Unregistered CMOs From Operating By Month End

Published

on

The Securities and Exchange Commission (SEC) says it will stop operations of Capital Market Operators (CMOs) that are yet to renew their registration on May 31, 2021.

This was contained in a circular signed by the management of SEC in Abuja on Monday.

On March 23, SEC had informed the general public and CMOs on the reintroduction of the periodic renewal of registration by operators.

The commission noted that the reintroduction of the registration renewal was due to the need to have a reliable data bank of all the CMOs registered and active in the country’s capital market.

“To provide updated information on operators in the Nigerian Capital Market for reference and other official purposes by local and foreign investors, other regulatory agencies and the general public, to increasingly reduce incidences of unethical practices by CMOs such as may affect investors’ confidence and impact negatively on the Nigerian Capital Market and to strengthen supervision and monitoring of CMOs by the Commission,” SEC explained.

According to the circular, the commission said CMOs yet to renew their registration at the expiration of late filing on May 31, would not be eligible to operate in the capital market.

It explained that CMOs were required to have completed the renewal process on or before April 30, however, the commission said late filing for renewal of registration would only be entertained from May 1 to May 31.

SEC also said that asides from barring the CMOs who failed to comply accordingly, their names would be published on its website and national dailies.

It added that names of eligible CMOs would be communicated to the relevant securities exchanges and trade associations.

Continue Reading

Crude Oil

A Threat to Revenue As Nigeria’s Largest Importer of Crude, India slash Imports By $39.5B

Published

on

Crude oil

Nigeria’s revenue earning capacity has come under threat following the reduction of importation of crude oil by India.

India, Nigeria’s largest crude oil importer, reduced crude oil imports by $39.5bn in April, compared to the same time the previous year, data from India’s Petroleum Planning & Analysis Cell showed.

According to the Indian High Commission in Nigeria, India’s crude oil imports from Nigeria in 2020 amounted to $10.03bn.

This represented 17 percent of Nigeria’s total crude exports for the year according to the Nigerian National Petroleum Corporation, as quoted by OilPrice.com.

As Nigeria’s largest importer of crude oil, lockdowns in India’s major cities from the COVID-19 surge in April had ripple effects on Nigeria’s oil sales.

The NNPC was prompted to drop the official standard price of its main export streams, Bonny Light, Brass River, Erha, and Qua Iboe, by 61-62 cents per barrel below its April 2021 prices. They traded at $0.9, $0.8, $0.65, $0.97 per barrel respectively, below dated Brent, the international benchmark, as Oilprice.com showed.

India had been buying the not-too-light and not-too-heavy Nigerian crudes that suited its refiners.

Reuters reported that the Indian Oil Corporation’s owned refineries were operating at 95 percent capacity in April, down from 100 percent at the same time the previous month.

An official at the IOC was quoted as saying, “If cases continue to rise and curbs are intensified, we may see cuts in refinery runs and lower demand after a month.” Hundreds of seafarers risked being stuck at sea beyond the expiry of their contracts, a large independent crude ship owner reportedly told Bloomberg.

India reportedly bought more American and Canadian oil at the expense of Africa and the Middle East, reducing purchases from members of the Organisation of the Petroleum Exporting Countries to around 2.86 million barrels per day.

This squeezed the group’s share of imports to 72 percent from around 80 percent previously, as India’s refiners were diversifying purchases to boost margins, according to Reuters.

India also plans to increase local crude oil production and reduce import expenses as its population swells, according to Bloomberg.

A deregulation plan by the Narendra Modi-led government to boost national production to 40 million tonnes of crude oil by 2023/2024, an increase of almost eight million tonnes, had already been initiated.

According to Business Today, an Indian paper, the country currently imports 82 percent of its oil needs, which amounted to $87bn in 2019.

Continue Reading

Energy

Invest Africa and DLA Piper Partner to Support ESG Best Practice in African Renewable Energy Projects

Published

on

Invest Africa - Investors King

The global law firm, DLA Piper, has partnered with Invest Africa, the leading trade and investment platform for African markets, to support the development of ESG best practice in African renewable energy projects.

Clear Environmental, Social and Governance (ESG) targets and measurements have become an increasingly important part of fundraising as investors seek to align their portfolios with sustainable growth. For a continent boasting ample natural resources, this presents a significant opportunity for Africa’s green energy sector. However, renewable does not always equal sustainable and developing and articulating ESG metrics can pose a significant challenge to projects as they prepare investment rounds.

The project will assemble experts from the worlds of impact investment, development finance and law. Across a series of online meetings, participants will discuss strategies to improve ESG practices in African renewable projects from both a fundraising and operational perspective.

Amongst those speaking in the inaugural session on Thursday 13th May are Cathy Oxby, Chief Commercial Officer, Africa GreencoDr. Valeria Biurrun-Zaumm, Senior Investment Manager, DEGOrli Arav, Managing Director – Facility For Energy Inclusion (FEI) – Lion’s Head Global PartnersBeatrice Nyabira, Partner, DLA Piper Africa, Kenya (IKM Advocates) and Natasha Luther-Jones, Partner, Global Co-Chair of Energy and Natural Resources, International Co-Head, Sustainability and ESG, DLA Piper.

Veronica Bolton-Smith, COO of Invest Africa said, “Africa is particularly vulnerable to the impact of climate change despite contributing very little to global emissions. As the price of renewables fall, they will form an ever more important part of Africa’s electrification. In this context, it is essential that projects be given the tools to apply best practice in ESG not only from an environmental perspective but also in terms of good governance, fair working conditions and contribution to social inclusion. I look forward to working closely with DLA Piper on this important topic.”

Natasha Luther-Jones, Global Co-Chair Energy and Natural Resources and International Co-Head Sustainability and ESG at DLA Piper also commented, “Climate change is one of the biggest challenges companies, and people, face today and when we look at its reduction – whether that be in how we power our devices, what we eat or how we dress, where we live or how we work – all roads come back to the need to increase the amount of accessible, and affordable, clean energy. However, renewable energy companies are not automatically sustainable as sustainability is a focus on all ESG factors, not just environmental. We know the need for renewable energy is only going to continue to rise, and therefore so will the number and size of renewable energy companies. The additional challenge is to make sure they are truly sustainable organisations and that’s what we’re excited about discussing during the webinar.”

Continue Reading

Trending