Indigenous steel firms seek role in N457bn power investment

ERERA Power lines24 November 2013, Lagos – Indigenous steel fabricating companies are seeking to play a major role in the N457bn power transmission infrastructure investment planned by the Federal Government.

With huge transactions underway for the transformation of the Transmission Company of Nigeria, which is the only PHCN successor company, still owned by the Federal Government, indigenous fabricating yards say they are in the best position to handle the construction of towers required to equip the TCN with
adequate transmission capacity.

The Vice Chairman, Dorman Long Engineering Limited, Chief Chukwuma Okolo, said the nation’s electricity industry stood to gain from the experience acquired by indigenous fabrication companies in the production of facilities for the oil and gas industry.

The Federal Government has said it would invest $2.86bn (N457.6bn) between 2013 and 2017 to give the nation a power transmission infrastructure that can carry 16,000 megawatts of electricity.

The Minister of Information, Mr. Labaran Maku, had said a transmission expansion blue print prepared by the Presidential Action Committee on Power committed the government to a transmission capacity of 16,000MW.

According to him, $150m will be sourced from the African Development Bank, $290m from the World Bank, and Eurobond of $150m.

Other funding sources are a $500m loan from the China Export Import Bank; proceeds from the sale of the National Integrated Power Plants, amounting to $1.6bn; and budgetary appropriation, $170m.

During a technical session at the third Practical Nigerian Content Forum, Okolo said the most logical thing was for indigenous fabricators to transfer their experience from oil and gas to the power sector in order to domesticate and check capital flight, consolidate indigenous capacity and create employment.

According to him, the capacity
development initiatives aimed at boosting local competence under the Nigerian Content Development Initiative should be demand-driven especially as it relates to fabricating companies.

He said medium sized and large
fabrication yards in the country were just about six in number, adding that they already had enough capacity for any job in the oil and gas industry.

Okolo said what fabricating yards needed was a guaranteed purchasing order to ensure that they would be patronised if they built more capacity.

Also, the Chief Executive Officer, Sparkwest Steel Industries Limited, Mr. Avner Nachmani, said indigenous firms had the capacity to supply the entire transmission tower needs of the country.

In an interview with our correspondent, Nachmani said, “We are a producer of fabricated and galvanised steel structures utilising cutting edge automated manufacturing technology. We have a factory in Nigeria with a capacity to produce 80,000 metric tonnes per annum of galvanised structures.

“We can supply the entire power transmission towers required to improve power transmission network in Nigeria. We have huge capacity and we are currently fabricating power transmission towers for a Romanian company implementing a project in Niger.”

The Federal Government had on November 1, 2013 handed over 10 electricity distribution companies and four generation companies formerly owned by the Power Holding Company of Nigeria to private investors.

The privatisation of the PHCN successor companies is expected to improve power supply in the country, but transmission has been considered as a major setback because the transmission network is old and weak.

Experts opine that the privatisation process will achieve little if nothing is done to improve the transmission network.

– The Punch

About the Author