Senate To Investigate Manitoba/TCN Deal

Senate-TCNThe Senate is to investigate the circumstances surrounding the preparation, execution and implementation of the management services contract for the Transmission Company of Nigeria.

The Bureau of Public Enterprise (BPE) transferred the management of the Transmission Company of Nigeria (TCN) to the Hydro International Nigeria Limited, also called Manitoba.

A Federal lawmaker, Senator Mohammed Hassan, alleged that the management services contract prepared by the BPE for the management of TCN by Manitoba is fraught with illegalities and total violation of the laws of the country.

Senator Hassan also claimed that Manitoba does not pay taxes on the monies it receives under the management services contract.

Senate Opposes Liquidation Of NITEL

The Senate Committee on Privatization and Commercialization has kicked against the proposed guided liquidation of the Nigerian Telecommunications Limited (NITEL) saying that the plan is not in the best interest of the country.

Speaking in an interview with journalists at the National Assembly Complex, the Chairman Senate Committee on Privatization, Olugbenga Obadara said the Bureau of Public Enterprise (BPE) is ignorant of the actual worth of NITEL.

He said instead of liquidating NITEL it should be allowed to pass through the process of concession.

The Senator said during discussions on the liquidation of Nitel, his committee was “confronted with facts that NITEL is owing Federal Government and other people N351 billion.

“But in the process, we asked the question who is owing NITEL? The people that are owing NITEL now we don’t know.

“We asked the question what is the worth of NITEL today? They cannot tell us the worth of NITEL. How do you now sell what you don’t know the worth,” Senator Obadara asked.

FG Offers To Sell Omotosho Power Plant To Chinese Firm

The federal government has offered to sell the Omotosho Power Station to Chinese engineering firm that upgraded the plant, the Bureau of Public Enterprise (BPE) stated. 

State-owned China Machinery Engineering Corporation (CMEC) completed the second phase of the Omotosho power plant in southwest Nigeria last month, taking total output from 375 megawatts (MW) to 500 MW. This represents more than 10 percent of the West African country’s total capacity.

The federal government wants to sell the plant to CMEC for $217.5 million, although $104 million would be offset against debts the government owes CMEC and a further $30 million would be kept for further work to be done by the Chinese firm, the BPE said in a statement on Wednesday.

China has made a number of loans in recent years to Nigeria to fund projects including a railway, aviation works, roads and power plants such as Omotosho, cementing its relationship with the energy-rich African country and also subsidising its construction industry.

Nigeria is now offering to sell the plant partly to pay back the loan. Industry experts also say power assets will be better managed and produce more electricity in company hands.

The government is breaking up the Power Holding Company of Nigeria (PHCN) into 15 firms handling generation or distribution in different parts of the country.

All of the preferred bidders for the firms that Nigeria is privatising met a deadline last week to pay a quarter of their bids, a landmark step in the process.

Although Nigeria holds the world’s ninth largest gas reserves, its total power output is around 4,000 megawatts.

14 Bidders Pay $559.44 Million For Power Companies

The Bureau of Public Enterprises (BPE) on Thursday confirmed the receipt of the sum of $559,445,573.96 from 14 bidders for 15 Power Holding Company of Nigeria (PHCN) successor companies.

The confirmation, which was contained in a statement issued by the BPE, came ahead of Thursday’s deadline for preferred bidders for the successor companies to make the mandatory 25 percent payment of the offer value of their bids.

The statement reads, “The BPE, on March 21, 2013, received $31million from 4Power Consortium; being the mandatory 25 percent of the bid value for Port-Harcourt Distribution Company; $31.5 million from Interstate Electrics Limited; being the mandatory 25 percent of the bid value for Enugu Distribution Company; and $27,913,633.50 from North-South Power Company; being the mandatory 25 percent of the bid value for Shiroro Power Plc.

“Earlier, Vigeo Consortium, the preferred bidder for Benin Distribution Company, had paid USD $32.25million; Transcorp/Woodrock Consortium, the preferred bidder for Ughelli Power Plc, paid $75 million; CMEC/EUAFRIC Energy JV, the preferred bidder for Sapele Power Plc, paid $50,249,965; Kann Consortium, the preferred bidder for Abuja Distribution Company, paid $41 million; Aura Energy, the preferred bidder for Jos Distribution Company, paid $20,464,968.15; Mainstream Energy Ltd, the preferred bidder for Kainji Power Plc, paid $59,467,500; and Sahelian Power SPV, the preferred bidder for Kano Distribution Company, paid $34.25million.

“Other bidders are: Amperion Power Company Limited, the preferred bidder for Geregu Power Plc, which paid USD$33 million; Integrated Energy Distribution & Marketing Company, the preferred bidder for Ibadan and Yola Distribution Companies, which paid USD$42.25 million and USD$14.75 million for Ibadan and Yola Discos respectively; NEDC/KEPCO, the preferred bidder for Ikeja Distribution Company, which paid USD$ 32.75 million; and West Power & Gas, the preferred bidder for Eko Distribution Company, which paid USD$33.75 million.”

Recall that the final approval of the preferred bidders by the National Council on Privatisation, NCP, and its announcement for the successor companies was done on October 23, 2012.
The Nigerian electricity industry has been unbundled into generation and distribution companies and a single transmission company with a view to encouraging private sector participation and attracting foreign and local investment into the Nigerian power sector to ensure economic and reliable electricity supply.

Manitoba completes take over of transmission company

Canadian company Manitoba Hydro International has signed an agreement with the Bureau of Public Enterprise for the management of  Transmission Company of Nigeria (TCN) today (Monday 23 July, 2012).

The company will start management of the company on Monday, July 30.      

 Director General of the Bureau for Public Enterprise, Bolanle Onagoruwa said one of the key objectives of the agreement is to stabilize the national grid and reduce electricity losses during transmission.

TCN is one of the successor companies created from the unbundling of the power holding company of Nigeria and will now be managed by manitoba hydro for three years at a cost of 23 million dollars.

While electricity generation and distribution will be fully privatized, government remains in charge of transmission though it will be managed by the private sector for improved output.The move to privatize the TCN has however has been opposed by electricity workers who are worried about their job security and severance package.

To quell the fears of the workers, Minister of Power, Barth Nnaji said the Canadian company is resuming with only eight of its staff with Nigerian workers expected to understudy their operations

Manitoba, whose financial bid for the management of TCN was opened on April 3, had emerged the sole bidder after the second firm in the race, Power Grid of India, failed to meet the technical requirement.