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FG’s N1.3tn electricity intervention offered no significant result – Minister

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The N1.3 trillion intervention fund provided by the Federal Government for the power sector has not yielded any significant result, Minister of Finance, Budget and National Planning, Zainab Ahmed, has declared.

The FG approved the sum of N701 billion on March 1, 2017 as power assurance guarantee funds for the Nigerian Bulk Electricity Trader (NBET) to pay for the electricity produced by the generation companies (GenCos) to the national grid for the period of two years.

The amount was provided to tackle the monthly liquidity challenges faced by GenCos, as the distribution companies (DisCos) keep defaulting in paying for the monthly invoice of electricity received.

In a letter to President Muhammadu Buhari dated November 19, 2021, the minister of finance detailed how funds could be raised through the sale of make-up gas to address the financial challenges in the sector.

“The industry requires N85 billion per month to pay for gas, generation, transmission and distribution operations,” the minister wrote.

She also stated, “Recent intervention (between 2017-2019) towards addressing the power sector problem includes the 701 billion and 600 billion payment assurance facilities (PAFs) secured from Central Bank of Nigeria (CBN) to take care of some of the FG contingent liabilities within the sector and which have not yielded significant result.

“Shortfalls caused by the large difference between allowed tariffs and what is required for cost recovery cost the FGN a total sum of N1.249 billion between 2017 and 2019. These resources are more needed for human capital development and infrastructural investment. The above includes some projects like the World Bank loan (up to $3 billion) for tariff shortfall and the euro 2.6 billion for the presidential power initiative is considered to support Nigerian Electricity Supply Industries (NESI).”

The minister also explained how Nigeria paid $137 million in two years for gas and electricity that were never used in the “take or pay deal” the country entered into with some investors in the power sector.

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Three Russian firms, eight others bid for Ajaokuta steel company

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Eleven companies are currently bidding for the concession of the Ajaokuta steel company, Minister of Mines and Steel Development, Olamilekan Adegbite, has said.

He said three of the bidders are Russian firms.

Adegbite disclosed this at the presentation of the achievements of his ministry during the 9th edition of President Muhammadu Buhari’s scorecard series,  held in Abuja on Thursday.

The minister said the Buhari government had been able to resolve all contending legal issues with the steel company and was in the concession process.

He also said the major issue with the company was the concession that was done in 2005 by former president Olusegun Obasanjo to Global Steel, which resulted in litigation and a demand of $7 billion by the company.

“One of the major albatross on Ajaokuta was the concession that occurred under former President Olusegun Obasanjo to Messers Global Steel Industries,” he said.

“Things went sour and they took us to court. The court case went on for about 12 years, but thanks to a patriotic Nigerian lawyer in the United Kingdom who handled the case very effectively.

“Global steel came with a demand of $7 billion, but our lawyer was able to puncture holes in their case, and at the end, they had to settle for $496 million.”

According to Adegbite, the judgement was favourable to Nigerians.

There had been issues around the payment of $496 million to Global Steel — years after the firm gave up all claims.

The minister also said the current administration had plans to make Ajaokuta Steel Company functional before the end of 2022, but for the outbreak of the COVID-19 pandemic.

He, however, said that the government was still committed to ensuring that the company was given out through a concession to a competent bidder with technical and financial capacities to optimise its potential.

“We were supposed to make the plant work in 2022. One of the presidential mandates was to resolve all contending issues on Ajaokuta,” he added.

“In 2019, at the Russian-Africa summit in Moscow, President Muhammadu Buhari discussed the idea of resuscitating Ajaokuta with President Vladimir Putin.

“An agreement was reached for Russian engineers to come in for a technical audit by March 2020.

“But the emergence of the first and second waves of COVID-19 stalled the plan.

“We hope that we can give Ajaokuta to a company, not just on a concession basis, but on equity participation.”

Adegbite further said out of the 11 companies bidding, adding that three of the companies were Russian.

“We are talking of companies who intend to bring their own money into Ajaokuta to make sure that it works,” the minister said.

“The plant is still good if we put in the right amount of capital, it will start producing in less than two years.

“Government has employed a transaction adviser who will guide us through the process.”

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Don’t buy meter, transformer, wires, NERC tells electricity consumers

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NERC’s Commissioner-in-charge of Consumers Affairs, Aisha Mahmud

• Insists consumers must sign agreement for refund
Nigerian Electricity Regulatory Commission (NERC), yesterday, in Abuja, said it remains the responsibility of electricity distribution companies to provide meters, transformers, poles, wires and other things needed for electricity supply to consumers.

NERC’s Commissioner-in-charge of Consumers Affairs, Aisha Mahmud, speaking during a three-day NERC/Abuja Electricity Distribution Company (AEDC) Customer Complaint Resolution Meeting, said a lot of consumers in Nigeria are not aware of their right.

“It is not the responsibility of the consumers to buy meters, poles or any assets for the DisCos (distribution companies) because we have already provided for that in the tariff of the utilities.
“But under any circumstances that you have to purchase these items and you cannot wait for the DisCos to make that investment, we have made provision for that under our ‘investment regulation’,” Mahmud said.

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She noted that the commission will continue to educate consumers on their responsibilities and obligations, adding that there’s a regulation, and based on that, if a consumer has to purchase a transformer, it has to be done through an agreement.

She said: “The agreement should contain a dispute resolution clause and all other items that are expected of a standard agreement. What we expect from the DisCos is to use their Internally Generated Revenue to buy those assets or rather use shareholders’ investment or borrow from banks to purchase the assets.”

According to her, it’s NERC’s responsibility to educate customers on their rights and obligations and all they are supposed to know about the electricity market.
Managing Director of AEDC, Adeoye Fadeyibi, said the company will do everything possible to meet the demands of consumers.

Represented by the Head, Regulatory and Government Relation of the AEDC, Olajumoke Delonia, Fadeyibi said the idea of the forum was to address customers’ complaints and commended NERC for the initiative.

Guardian

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Naira: CBN Receives Over N500bn Old Notes

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Governor of the Central Bank of Nigeria, Godwin Emefiele

As Nigerians count down on the official disbursement of new naira notes, the Governor, Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, yesterday, revealed that the apex bank had received over N500 billion old notes as more people are working to meet the deadline. Emefiele, who stated this after a visit to President Muhammadu Buhari in Daura, Katsina State, to brief him on developments in the economy, also informed journalists that the president reaffirmed his support for all decisions so far taken on the currency alteration and cashless policy decisions.

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He said in order to ensure that members of the public are not placed in a tight corner, deposit money banks (DMBs) had taken delivery of the new currencies for onward circulation from December 15. Emefiele’s meeting with the president came on the heels of National Assembly’s objection to the implementation of withdrawal limits announced Tuesday by the apex bank The CBN governor said President Buhari was happy with the CBN policy and urged him to go ahead with implementation. Asked of his mission in Daura by newsmen, he said: “I am visiting Daura to see the President, and also greet him as part of my normal briefing that I normally carry out. The briefing has been overdue and I thought he should be briefed on what is happening in central bank and the economy.

“There are so many things happening, issues bordering on currency. “Only yesterday, the new currencies have now reached the banks, and we expect the banks to begin the distribution of the currencies to members of the public and customers; and to assure the president that things are going on well about the currency and the issue bordering on cashless policy that we recently introduced.”

New Telegraph

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