3,050MW Plant: FG, Chinese Bank Negotiate $4.92bn Loan

• 3,050MW Plant: FG, Chinese Bank Negotiate $4.92bn Loan

The Minister of Power, Works and Housing, Babatunde Fashola, announced on Wednesday that the Federal Government had commenced negotiations for a $4.92bn loan from the China Exim Bank for the construction of the 3,050 megawatts Mambilla Hydro Power Plant.

Speaking at a workshop on the Power Sector Recovery Programme in Abuja, the minister stated that the Federal Ministry of Finance had taken over the process that would ensure the release of the fund to Nigeria.

Last Friday, the Federal Government signed the contract for the construction of the hydro power plant with a consortium of three Chinese firms, namely, China Gezhouba Group Corporation, Sinohydro Corporation Limited and CGCOC Group Company Limited.

Fashola stated that the negotiation with the China Exim Bank was also aimed at determining the terms of the loan, adding that until this was concluded and Nigeria guaranteed the loan, it was difficult to state exactly when work on the project would commence.

The minister said, “The signing of the contract for the construction had taken place last Friday. It is supposed to be funded by the China Exim Bank. The negotiations for the loan will now start. For this period, I am waiting because it is now the Ministry of Finance that has taken over. They are the ones who do treasury works and raise loans for Nigeria.

“So, we do the negotiations, and when we secure the loan, then we are able to tell you that this is the start date. There is a lot of preparatory works going on and we should have signed an MoU with the Taraba State Government. We have already got a liaison office in the state, the governor did that.

“We also constituted the project team; the contractors have already started route estimation and analysis, how they are going to move heavy equipment and all of that; and there will be a lot more of that to come. It is a big contract”

The government signed the agreement for the construction of the Mambilla plant in six years with the Chinese consortium in Abuja last week.