N23b Oghara IPP abandoned

28 October 2015, Oghara – Davnotch, the contractor executing the N23.2 billion Delta State Independent Power Project, IPP, at Oghara, Ethiope West Local Government Area, initiated by the immediate past governor of the state, Dr. Emmanuel Udaughan, in 2009, has finally abandoned the job,Niger Delta Voice can authoritatively reveal.

Last Friday, when Niger Delta Voice visited Oghara, weeds had overtaken the project site deserted for about a year now. The premises lay idle. The cabins, which served as temporary offices, were under lock and key, while the warehouses were principally unfinished.

Governor Ifeanyi Okowa of Delta State

Governor Ifeanyi Okowa of Delta State

The turbine masks, office blocks, security house, stores and basement also remain uncompleted. At the deserted site were two caterpillars and one pick-up van with deflated tyres. Also at the temporal warehouse in Oghara, housing some of the imported equipment, it was also evident that nothing was going on, as the depot, almost gutted by fire, some months ago, was lifeless.

The IPP project is a combined cycle utilizing gas/diesel power plant, involving acquisition and installation of two open cycle Rolls Royce Trent 64 MVA Phase IV Gas Turbines and two 64 MVA Brush generators, capable of generating 100MVA.

Gov Okowa’s visit

It was gathered that the governor, Senator Ifeanyi Okowa, had also visited the project site to assess the situation on ground. However, he has not publicly declared his position on the project. A top official of the company, however, said: “There is no fraud, the company has delivered on what government had paid so far, there is no money now to continue, we need money to complete the project. The equipment ordered had been brought in and are in the warehouse in Oghara.”

The project was very dear to Dr Uduaghan, but it could not be verified why it was not completed during his tenure, as it laid comatose in the last months of his administration. The only thing that could be insinuated was that his political relationship with the former Speaker, Ochei, who divested his interest in the company, two years after the contract was sealed, nosedived during the period.

Ochei contested the Peoples Democratic Party, PDP, governorship primaries in 2014, which Okowa won. Both are from Delta North senatorial district, but the governor, reportedly, does not want to politicize the project, except that the state was facing financial difficulties.

Clark’s initial alarm

Former Federal Commissioner for Information, Chief Edwin Clark, raised the alarm in 2013 that the contractor, Davnotch, had abandoned the project, but many read political mischief in his comments because he was allegedly against the gubernatorial ambition of Ochei. Ochei dismissed Clark’s allegation at the time, while officials of the firm took reporters on a tour of the project site to assess things on ground, including the two gas turbines and accessories, manufactured by Rolls Royce, United States of America, USA, already at the temporal warehouse. Two years after, the former Speaker confirmed to Niger Delta Voice that funds were not coming from the state government and that was the reason the company was not on site.

Dogged by controversy

Besides, controversy is also trailing the actual money disbursed by the state government for the project. Former Commissioner for Energy, Mrs. Gloria Okolugbo, reportedly told the state House of Assembly Committee on Finance and Appropriation, February 18, that the state government had spent N23.6 billion and not N29 billion on the power project.

Okolugbo spoke at a budget defence meeting, months before Uduaghan handed over power to the incumbent governor, Senator Ifeanyi Okowa. But a source said she had since denied making such statement, maintaining that what government paid the contractor was N19 billion. Indeed, since the project was awarded in 2009 at an estimated cost of N21.5 billion before its upward review to N23.6 billion, several amounts, including N27 billion and N29 billion, had been quoted as part of the money embezzled. Some community sources swore to Niger Delta Voice in Oghara that the state government paid the contractor N22 billion.

Okolugbo had informed lawmakers that the project’s civil works was 70 percent completed and that most of the equipment for the IPP project had been procured and awaiting installation. According to her, the delay in the installation of the equipment was due to lack of access road to the project site, adding “however, now that the road is completed, equipment will be moved to the site soon.” Eight months after she gave fresh hope on the project, nobody has installed equipment; rather the contractor has vacated the site.

Villagers rage

The people of Oghara are, however, chagrined at the abandonment of the project, describing it as callous and wicked act by government and the contractor.

An elder in the town, Chief Isaac Ajueshi, alleged that the contractor was owing local suppliers, community labourers and other service providers over N30 million.

His words: “I am calling on the Economic and Financial Crime Commission, EFCC, to wade into the matter and unearth how a huge sum of N22 billion was collected by the contractor, yet he did not only abandon the project, but absconded with over N30 million due workers, service providers and suppliers of the community origin.”

Govt won’t abandon project—LG chair

Chairman, Ethiope West, Mr. Solomon Golley, said: “The project would be resuscitated. Government will not just abandon it like that. The project would eventually be completed in due course.” The Community Liaison Officer of the project, Mr. Isreal Moriafe, told Niger Delta Voice: “I am appealing to the community people to toe the part of peace. I have confidence that their money would be paid.

“I know the government knows what to do. I also know that the contractor will settle amicably with the local workers and suppliers. “Even if the community people are very angry now, they should still give the contractor some time. For now, the security men are fully on ground, protecting the premises and I can assure you that things will work out well with everyone, who has worked or made supplies in this project.”

Workers complain

A security guard at the project site, Lucky, said: “We have not been paid for four months; we are in real deep trouble. We did not know that the contractor will disappear with our money. We are six security men in the main facility and two others in the temporary warehouse. “Out of the six in the main facility, three work in the night, while three work in the day. Out of the two security men in the temporary warehouse, one work in the night, while one work in the day. None of us has been paid for over four months now.”

A worker, Benson, said: “The contractor is a terrible person. He ran away all these while, but when he heard that Governor Okowa was coming some weeks ago, he stealthily brought people to clear the site and faded away after Governor Okowa left. “He did not want the governor to know that he had absconded.

“He even told lies when Okowa came to the site. He said he sand-filled the whole premises, which was a big lie. The premises have always been upland. He did not sand-fill anywhere in the premises. Again, the entire work is below 10 percent completed, yet he is claiming that he has done 75 percent. If you did not come here, you would not know that he was telling lies.”

Local supplier cries out

A local supplier, Chief Edevoro Mike, said: “The situation is very appalling. Why will a contractor of such calibre receive N22 billion for this project, yet there is nothing on ground to show for even N1 billion? “They just collected the money and absconded. If I tell you what they owe me alone for supplies that I made, you would be surprised. Right now, things are very tough for me and my family. I have expended all I have in the supplies.

“I even borrowed to add to what I could get on my own. I cannot pay the interest now. My bankers are after me. I am really in a mess. “When this project began in 2009, we were all happy that some good has come to Oghara. We never knew that they will abscond with our money and make life even more uncomfortable than we were before they came here.

“The security men are threatening to quit the site. If they do that now because of non-payment of their over four months’ salary arrears, the entire premises will be left at the mercy of thieves, and the whole place will be looted.”

No compensation yet

Mrs. Tobe Afe, who relinquished her over 300 acres for the project, said: “The government paid over N100 million to the contractor to settle for the land acquired for the project, but he only gave me N13,000, the rest went into his pocket. “We heard that some of them built housing estates in Asaba and other places. One very senior official among them even bought a house in America and relocated his family there, and they shared the billions among themselves.

“A very senior government person took some of the money to China where he now owns chains of businesses. We are very surprised that they treated us like this, even when we were so peaceful with them. “There was no youth restiveness when they were moving in and they did not spend any money to enter into the community; a gesture we believe they ought to reciprocate with good behaviour. But they disappointed every one of us.”

Ochei’s reaction

Contacted on the allegations, Managing Director of the company, Norbert, said: “Please direct all your enquiries to the Chairman of the company or any other appropriate quarters. I have no comment for you,” and hung up. Former Speaker, Victor Ochei, told our reporter on phone: “I was once the Chairman of the company, but I have moved out of that place. I have divested all my shares; I am no longer the chair.

“When I was there, the government paid N19 billion naira only. They did not pay any more money after that. I hear people say that government paid me N22 billion, which is not correct. We received N19 billion and when the money finished, we stopped there. “Can the government show the public evidence that it paid us N22 billion? It cannot prove it, so why are they saying they paid us N22 billion? Our invoices are with the government. Let them bring them out to the public.

“If government has not paid more money, where do they expect the contractor to get money to complete the project? I am sure they are just looking for ways to malign me and they will fail. Nobody can drag my good name and reputation to the mud. That is all I can say.”

Price review

The initial cost of the power plant was N21,750,000, but reviewed upwards to N23.207,826,566 due to the change of the gas turbine generators from the phase III to phase IV type. The change resulted in an additional 12MW power output (6mw per turbine). Government awarded the contract June 23, 2009 with a time line of 24 months for execution. Crisis in the energy sector necessitated the IPP project. The state was not getting more than 108 megawatts of electricity from the Power Holding Company of Nigeria, PHCN, compared to the load demand of about 1,000 megawatts.

A consortium of engineering firms, appointed by the state government in 2000, to undertake a power survey of the state, estimated the power demand for the state between 2000 and 2010 to be in the range of 440MW to 570 MW. The generated 100MVA will feed Sapele, Mosogar, Oghara, Koko and Effurun by direct connection to Amukpe/Sapele 132 KV substation. The excess power will go to Ughelli and Benin for redistribution to other parts of the state.

Also, there will be off-grid distribution of 10MV Island mode operations for the small island of Oghareki to minimize reduction of the gas turbine life span that is associated with grid instability.

  • Vanguard
About the Author