Nigeria Nears $1.15 Billion Power Plant Sale, Bid Winners to Be Announced Soon

Nigeria is on the cusp of a significant transformation in its power sector as it nears the conclusion of a $1.15 billion sale of five key power plants.

This move is part of the government’s broader strategy to enhance efficiency, attract private investment, and address chronic power shortages.

The announcement of the preferred bidders is expected soon, marking a pivotal step toward economic growth and energy sector reform.

Adebayo Adelabu, the Minister of Power, confirmed that the bidding process has been finalized, and a comprehensive report has been submitted to the National Council of Privatisation (NCP).

The council, chaired by Vice President Kashim Shettima, is set to make the final decision.

“At the next NCP meeting, a final announcement of the preferred bidders will be made public,” Adelabu stated at the BusinessDay’s Powering Nigeria conference on Friday.

He emphasized that the assets’ sale would not only generate revenue for the federal, state, and local governments but also enhance the power sector’s efficiency.

Adelabu acknowledged some ongoing challenges, including bid quotes, payment modes, and other procedural issues, but assured that these are being resolved.

The five power plants included in the sale are the 434-megawatt Geregu II gas-fired plant in Kogi, the 451MW Omotosho II plant in Ondo, the 750MW Olorunsogo II plant in Ogun, the 563MW Odukpami plant in Calabar, Cross River, and the 451MW Benin-Ihovbor plant in Edo.

The anticipated sale prices are as follows:

• Benin-Ihovbor plant: $420 million
• Calabar Odukpami plant: $260 million
• Geregu plant: $215 million
• Omotosho plant: $85 million
• Olorunsogo plant: $170 million

This move follows a December 2022 agreement between the federal government and state governors to sell these power plants, managed by the Niger Delta Power Holding Company (NDPH), to fund the 2023 budget.

This agreement came after more than two years of disputes and legal battles regarding the sale of the National Integrated Power Projects (NIPPs).

The Bureau of Public Enterprises (BPE) has been instrumental in the sale process. In April 2021, the National Council on Privatisation approved a fast-track strategy for selling five NIPPs.

By March 2022, the Nigerian National Petroleum Corporation expressed interest in acquiring some of these plants, indicating ongoing progress.

The forthcoming announcement of the bid winners marks a crucial milestone in Nigeria’s efforts to revitalize its power sector, promising improved efficiency, increased revenue, and a more robust economic future.