A Review of the Nigerian Energy Industry

5,000MW electricity generation goal still on course – Nnaji

*Califco group plans 2,000MW with $2bn investment in power

Oscarline Onwuemenyi

4 December 2011, Sweetcrude, ABUJA – The Minister of Power, Prof. Bat Nnaji has insisted that the Federal Government’s plans to attain about 5,000 megawatts of power generation in the country was still possible despite recent challenges within the sector.

Nnaji, who was speaking in an interview with our correspondent at the background of a meeting with a group of investors representing Califco Group, in Abuja, explained that the drawbacks experienced in power generation in recent months was due to poor gas supply to power plants, adding that government was doing everything to address the issue.

He said, “We told Nigerians that by the end of this year and by the beginning of next year, we would generate 5,000MW of electricity. So far, so good. As at today (Friday), we are generating about 4,300MW of power, and we are confident that more megawatts would be added to the grid in the coming weeks, and we hope to keep improving from that.”

According to officials of the Ministry of Power, an additional 600MW is expected within the next couple of weeks from the Shiroro Hydro power station, which has been undergoing rehabilitation in the past few months.

Furthermore, the government has said that more electricity is being expected from some of the Independent Power Producers (IPPs), as well as from major power stations, even as it is doing everything possible to ratchet up the generation capacity in the coming months.

Speaking on the proposal by Califco Group to invest over $2 billion in the nation’s power sector and its plan to use special barges to develop about 500MW in a few months, Nnaji said, “I like their proposal to create power speedily, using some of the most modern technologies in the world. However, there are some grey points we have raised with regards to pricing and the public-private partnership proposal.

“We have made it clear that whoever is coming into the country to generate electric power must be ready to sell at a price that falls within our Multi-Year Tarriff Order (MYTO) band which has been set by the Nigerian Electricity Regulatory Commission, NERC.

“Government has also stressed that it has no interest in developing power plants for now, rather it wants to act an enabler for private investment by creating the necessary conditions and providing incentives to encourage private sector investment in power generation and distribution.”

The Minister added that the reason for the planned full liberalization of the power sector was to ensure that private concerns with adequate financial and technical depth, with the requisite agility and capacity can come in and provide the right services for Nigerians.

He noted that, “It is the policy of this administration that projects like power that are so vital to the well-being and growth of our national economy should not depend on government budgeting with its attendant bureaucracy and inefficiencies, so that they can move faster and deliver better services to people that need them badly.”

Meanwhile, Califco Group has expressed desire to develop about 2,000MW of power by investing $2 billion in the nation’s power sector over the next three years.

According to Mr. Emeka Okwuosa of Frazimex Limited, one of the promoters of the company, the project concept is the development of additional 2,000MW using gas-fired turbine power plants fueled by natural gas or LPFO at critical power need locations where the capacity is available on the national grid.

He added, “Our immediate project objective will be the expansion of the Egbin Power Station by an additional 500MW using either a land based or barge-mounted gas fired turbines within the next eight to 12 months.”

Califco Group is a consortium of American, European and Nigerian companies with extensive experience in the planning financing, engineering, design, construction, operation and maintenance of power plants. The group includes companies that have developed over 200,000MW of power in different parts of the world including the US, Middle east and several African countries.

In this article

Join the Conversation