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FG Completes Concession Process for N6.68bn Hydropower Plant

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  • FG Completes Concession Process for N6.68bn Hydropower Plant

The Federal Government has completed the concession process required for the handing over of the N6.68bn Gurara Hydropower Plant to a concessionaire.

It said the 30-megawatts power plant located in Kaduna, would contribute to addressing the gap in electricity supply across the country, particularly in the North-West states of Nigeria.

The Minister of Water Resources, Suleiman Adamu, who disclosed this while speaking on the sidelines of a media workshop in Abuja, also noted that the Federal Government had decided to concession the hydropower components of selected dams.

He said the Gurara dam was one of the selected dams, adding that the processes needed to concession the 30MW project had been completed.

Adamu said, “We are not concessioning the entire dams in our concession arrangement. Rather, the concession is for the hydropower component of the dams and the dams will still be owned by the Federal Government.

“In Gurara, we have a hydropower plant there. All the processes for the concessioning have been completed and it is now a matter of presenting it to the Federal Executive Council for approval.”

The minister, however, observed that the transmission lines to evacuate power from the hydropower plant were not ready yet.

“That is not within the purview of the Federal Ministry of Water Resources, it is undertaken by the TCN (Transmission Company of Nigeria) but a lot of provision has been made and we hope that by the end of this year something better will happen,” Adamu stated.

He further noted that the 40MW Kashimbilla Hydropower Plant was also ready.

“Again, we are also waiting for transmission lines to be completed but have started the process of concessioning and we have appointed a transaction adviser, hopefully by next year, we should be able concession that one as well,” Adamu said.

On why there was a need for the hydropower project, the Infrastructure Concession Regulatory Commission explained that the plant when operational, would increase the country’s overall power generation.

The ICRC stated that in addition to fulfilling the water supply needs of residents, the dam had been equipped with world-class amenities for hydropower generation, irrigation, farming, tourism development, and fish farming.

It said the water ministry plans to integrate the 30MW power plant into the Gurara dam works, which is expected to produce 115 gigawatts-hour of energy annually, representing a 44 per cent annual capacity factor.

“The water from the Gurara reservoir will be used to produce hydroelectricity using the water that is available once the water supply demands have been satisfied,” the commission stated on its website.

On the rationale for adopting a Public Private Partnership model for the operation of the plant, the ICRC explained that the proposed model for the concessioning of the hydropower component of the dam would require one concessionaire to take custody of the project for a period of time as determined by the financial analysis.

It stated that under this form of PPP, the concessionaire would be responsible for the use of the asset in generating hydropower and connecting to the transmission network made available by the TCN on behalf of the Federal Government to the sub-station for distribution.

“Therefore, an operate-and-maintain model was selected as the best PPP methodology for concession of the project,” it added.

Adamu had earlier revealed that Nigeria had a hydropower potential of 12,220MW but that only about 1,930MW of this had been developed at Kainji, Jebba and Shiroro dams.

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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Economy

NLNG Boosts Cooking Gas Production to 1.5 Million Metric Tonnes Annually

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cooking gas cylinder

Nigeria Liquefied Natural Gas Limited (NLNG) has announced a significant milestone in its operations, boosting its annual production of liquefied petroleum gas (LPG), commonly known as cooking gas, to over 1.5 million metric tonnes.

This surge in production underscores NLNG’s commitment to meeting the rising demand for clean cooking energy in Nigeria.

The entirety of NLNG’s 1.5 million tonnes production is now being sold domestically within Nigeria.

Moreover, the company has initiated a landmark shift by starting to supply LPG in naira, moving away from the traditional practice of trading in United States dollars.

This move aligns with calls from stakeholders in the oil and power sectors advocating for naira transactions, especially amidst the challenges posed by currency fluctuations.

During a panel session at the 7th Nigeria International Energy Summit in Abuja, NLNG’s General Manager of Finance, Fatima Adanan, highlighted the company’s dedication to enhancing LPG penetration across the country.

Adanan emphasized NLNG’s vision to make Nigeria a better place by promoting the use of cleaner energy sources like gas.

While NLNG’s production surge is commendable, Adanan acknowledged that Nigeria’s LPG requirements surpass the current output, necessitating imports to bridge the gap.

However, NLNG remains committed to expanding its production capacity to meet the nation’s energy needs and drive increased adoption of LPG as a cleaner cooking fuel.

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Economy

CBN Raises Benchmark Interest Rate by 400 Basis Points to 22.75%

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has raised the benchmark interest rate by 400 basis points to a record 22.75%.

The decision made by the Monetary Policy Committee (MPC) comes amidst rising inflationary pressures and growing uncertainty in Africa’s largest economy.

Nigeria’s inflation rate rose to 29.90% in January 2024, the highest in over two decades while the nation’s unemployment rate quickened to 5% in the third quarter of 2023. Suggesting that the rising costs have continued to drag on both new job creation and the existing ones.

This coupled with a series of policy adjustments implemented by President Bola Ahmed Tinubu has plunged economic productivity and eroded consumer spending as citizens grapple with high fuel prices, electricity tariffs, a record-high foreign exchange rate, and insecurities.

Therefore, it is surprising that the Monetary Policy Committee (MPC) led by the CBN will further increase borrowing costs by 400 basis points at a time when job creation is paramount.

While the economy reportedly grew by 3.46% in the fourth quarter (Q4) of 2023 on the back of robust performance of the services sector, this growth is yet to crystalise as businesses and citizens have taken to the street protest against the harsh economic situation.

Economic experts have started questioning the data from the National Bureau of Statistics (NBS) given its lack of correlation between the data and economic reality.

 

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Economy

President Tinubu Unveils Geometric Power Plant in Aba After 20-Year Wait

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Geometric Power Plant

After two decades of anticipation, President Bola Tinubu, through his representative Vice President Kashim Shettima, inaugurated the long-awaited Geometric Power Plant in Aba, a significant milestone in the city’s quest for reliable electricity supply.

The event, which also saw the commissioning of three rehabilitated roads by Abia State Governor Alex Otti, symbolizes the culmination of years of perseverance and determination to transform Aba’s power landscape.

Addressing the audience, Vice President Shettima hailed the project as a testament to the power of visionary leadership and unwavering commitment to progress.

He said the Geometric Power Plant exemplifies the transformative impact of strategic infrastructure investments on local communities.

Governor Otti echoed similar sentiments, emphasizing the importance of the power project in positioning Aba as a hub for national and international business ventures.

He commended the efforts of Geometric Power Limited while urging them to uphold transparency and avoid exploiting consumers.

The inauguration of the Geometric Power Plant comes amidst growing concerns over Nigeria’s power infrastructure and the need for sustainable solutions to address electricity shortages.

The project, with a capacity of 188MW, holds promise for significant improvements in power supply across Abia State, benefitting nine out of seventeen local government areas.

The Managing Director of Geometric Power Limited, Ben Caven, underscored the scale of investment involved, totaling $800 million.

He highlighted the comprehensive nature of the project, which includes the installation of new power substations and a 27km natural gas pipeline, signaling a comprehensive approach to enhancing Aba’s energy infrastructure.

In conclusion, the inauguration of the Geometric Power Plant represents a transformative moment for Aba, offering renewed hope for economic growth and prosperity powered by reliable electricity supply.

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