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Power Firms Reject TCN as Proposed N72bn Fund Manager

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electricity
  • Power Firms Reject TCN as Proposed N72bn Fund Manager

Operators in Nigeria’s power sector on Sunday rejected the Federal Government’s selection of the Transmission Company of Nigeria as the firm that will manage a N72bn investment fund expected to boost electricity distribution networks across the country.

The government has hinted of plans to invest N72bn in the distribution assets in order to effectively distribute more power.

The Managing Director, TCN, Usman Mohammed, recently stated that the transmission company would manage the fund.

But the power distributors on Sunday kicked against the move, as they argued that as holders of up to 60 per cent shares in the distribution assets, their boards should be allowed to deliberate and decide on the conditions for such investment, if they would ever accept it.

According to a document made available to our correspondent in Abuja by the Association of Nigerian Electricity Distributors, the Discos said they did not trust the capacity of the TCN to manage the investment fund.

They said, “It will be difficult for the Discos to acquiesce to the TCN/Ministry of Power, Works and Housing adding a further N72bn of debt to the N1.3tn of debt (and growing) already to our financial books, given the Discos’ inability to access debt financing required to address massive capital expenditure requirements.

”The capital expenditure requirements far exceed the N72bn initiative required to inject the efficiency that electricity customers demand, the Discos’ regulatory constraints, and the uncertainty of projects built by an entity that is licensed only to transmit energy and not distribute energy.

“It should also not be forgotten that the Discos are already carrying, out of the total sum of N210.61bn, 72.25 per cent or N152.16bn of legacy gas and energy debt (incurred by the defunct PHCN) associated with the Central Bank of Nigeria’s Nigerian Electricity Market Stabilisation Facility, a debt unconnected with the Discos, a contravention of the debt-free requirement, that was a fundamental contractual requirement of the sale of the distribution assets.”

ANED said the N72bn initiative held for the Discos pitfalls that would undermine any expected positive outcomes that were the genesis of the government’s plan.

They said the basis of the planned funding was to evacuate 2,000 megawatts of electricity which they claimed was not stranded on account of distribution limitations but mostly by gas, frequency and line constraints.

The power firms also explained that given the heavily regulated nature of their business, they were not sure they could recover the investment through tariff because it might not adhere to the regulatory requirement for capital investment, which the Nigerian Electricity Regulatory Commission stipulated for them.

“To ensure that electricity customers do not unduly bear the cost of electricity inefficiencies, fundamentally, all related procurement is required to be implemented efficiently and on a best-value basis. The implementation of this N72bn initiative by the TCN, outside of the regulated procurement requirements that the Discos are subjected to, will leave the best-value requirement wanting,” they said.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Banking Sector

Access Holdings Plc Plans $1.8 Billion Capital Raise

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Access bank

Access Holdings Plc, the parent company of Nigeria’s leading bank, Access Bank Plc, has unveiled ambitious plans for a $1.8 billion capital raise aimed at fueling its expansion efforts over the next four years.

The strategic move comes as Access sets its sights on becoming one of the largest lenders on the African continent.

During a conference call with investors in Lagos, executives outlined the company’s intention to raise $1.5 billion, or the naira equivalent, through the issuance of shares, bonds, or other financial instruments.

Also, Access aims to generate up to 365 billion naira ($257 million) by selling shares to existing investors.

Bolaji Agbede, acting group chief executive officer, clarified that the current fundraising initiative primarily involves a rights issue.

The capital infusion is earmarked to support Access’s ambitious growth plan, which commenced last year.

The bank intends to expand its footprint into new markets, including Morocco, Egypt, and the United States, as part of a broader strategy to double the share of assets outside its home market by 2027.

With operations spanning 22 countries, including the United Arab Emirates and the UK, Access Bank is positioning itself for significant international growth.

The recent appointment of Bolaji Agbede as acting group CEO follows the passing of co-founder and former CEO, Herbert Wigwe, adding a layer of significance to the bank’s future direction.

Access’s acquisition of National Bank of Kenya Ltd. underscores its commitment to expanding its presence in East Africa’s largest economy.

As Access Bank charts its course for expansion, the $1.8 billion capital raise signals its determination to seize opportunities in a rapidly evolving financial landscape, both domestically and across the African continent.

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Finance

OPEC+ Production Cuts and Geopolitical Tensions Propel Oil Price to Over $87

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Crude oil - Investors King

Oil price surged past the $87 price level on Thursday on the back of production cuts by OPEC+ nations and escalating geopolitical tensions.

Brent crude oil, against which Nigerian oil is priced, rose by $1.39 or 1.6% to $87.48 a barrel, its highest level since October 27.

OPEC+, the alliance of major oil-producing nations, has remained resolute in its commitment to curtail output, effectively tightening the supply of crude in the market.

Despite calls for increased production to alleviate soaring prices, the alliance has opted to maintain its course, further buoying the market sentiment.

Simultaneously, geopolitical tensions have added fuel to the fire. Attacks on Russia’s energy infrastructure, particularly by Ukraine, have sparked concerns over potential disruptions to the global oil supply chain.

Despite diplomatic efforts to deter such actions, the situation remains precarious, contributing to market anxieties.

Analysts suggest that these price surges may have long-term implications for global economies, particularly for oil-importing nations heavily reliant on stable energy prices.

Furthermore, the impact of rising oil prices on inflation and consumer spending patterns remains a point of contention among economists and policymakers.

As the world watches with bated breath, the trajectory of oil prices hinges on a delicate balance between geopolitical developments, OPEC+ policies, and the broader economic landscape.

For now, the $87 threshold serves as a stark reminder of the volatility and interconnectedness inherent in the global energy markets.

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Insurance

Heirs Insurance Group Unveils Revolutionary Website for Seamless Insurance Experience

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Heirs Life Assurance- Investors King

Heirs Insurance Group has launched a website designed to revolutionize the insurance experience for its customers.

With a focus on simplicity, accessibility, and personalized service, the new website aims to streamline the process of obtaining insurance coverage and empower customers to make informed decisions about their insurance needs.

The website boasts a range of innovative features that make navigating insurance options easier than ever before.

From simple and intuitive navigation menus to personalized insurance recommendations, the website is designed to guide customers through every step of the insurance process quickly and efficiently.

According to Ifesinachi Okpagu, the Chief Marketing Officer of Heirs Insurance Group, the new website embodies the company’s commitment to delivering exceptional customer service.

“Today’s customers want simplicity, and this new website delivers on that request,” Okpagu said. “We are empowering customers to take control of their lives, their businesses, assets, and their most cherished people.”

One of the key features of the website is its personalized insurance experience, which takes customers through a short journey to help them identify the best insurance plan for their needs.

Whether customers are looking for coverage for their home, car, business, or loved ones, the website provides tailored recommendations to ensure they find the right insurance solution quickly and easily.

With its user-friendly interface and innovative features, the new website from Heirs Insurance Group sets a new standard for the insurance industry, making it easier than ever for customers to protect what matters most to them.

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