Nigeria Signs $272m Power Plant Agreement with Transcorp

Nigeria’s federal government will Thursday sign an agreement with Transcorp Consortium, the preferred bidder of Afam Power Plant, with a bid sum of N105 billion (about $272m).

The Director-General of the Bureau of Public Enterprises (BPE), Mr. Alex Okoh, told journalists Wednesday in Abuja that the agreement-signing ceremony showed the fact that rather than being hamstrung by the negative impact of COVID-19, the privatisation agency scaled up its activities during the pandemic by concluding the sale process.

He stated: “We had to review our activities as an agency upward instead of downward as a result of the COVID-19 issues. We did not slow down but actually heightened activities basically to help generate revenue to support the fiscal plan for the year.

“And incidentally, tomorrow (Thursday) just as an indication of some of the activities that we have heightened up, we are going to be doing the signing ceremony for the sale of Afam Power Plant to the preferred bidder. That alone will fetch the federal government a total sum of N105 billion. So, we didn’t slow down our activities at all; business is continuing as usual for us.”

Okoh said the preferred bidder for the power plant also runs the Transcorp Ughelli Power Plant, adding that they won the bid out of a strong field of about 12 prospective investors.

“So, tomorrow, we will do the signing ceremony at the Office of the Vice President and then, they (Transcorp) go ahead 15 days after to pay the 25% of that N105 billion, and subsequently they will pay the 75%,” he added.

The Afam Plant and Yola Electricity Distribution Company are among nine power assets listed for sale this year alongside 10 other government-owned companies, all projected to yield over N260 billion (about $675m)

The Afam IV-V Power Station, located in Oyigbo Local Government Area of Rivers State, is owned by the defunct Power Holding Company of Nigeria (PHCN).

The National Council on Privatisation (NCP) had October 2019 approved Transcorp Power Consortium as the preferred bidder for the Afam Electricity Generation Company (Afam Power Plc and Afam Three Fast Power Limited) with a bid price of N105.3 billion.

Diamond Stripes Consortium was approved as the reserve bidder with a price of N102.3billion.

Meanwhile, the BPE has denied the allegation of diversion of the N2.5 billion (about $6.5m) PHCN funds to buy property in Aso Savings.

In a statement made available to THISDAY, the BPE debunked the reports, saying that on February 24, 2014, the agency got the approval of the Accountant-General of the Federation (OAGF) to establish a banking relationship with Aso Savings and Loans Plc.

It said: “Subsequently, the bureau made a placement in the sum of N2.5 billion in the account to facilitate access to cheap finance for the bureau’s staff housing scheme but the staff were not able to access the money.

“Following the federal government’s directive on 14th September, 2015 that all funds held with commercial banks be transferred to the bureau’s Treasury Single Account with the Central Bank of Nigeria, it was discovered that Aso Savings and Loans Plc could not meet its deposit repayment obligations, leading to a new repayment agreement.”

The statement added that despite the new arrangement, Aso Savings and Loans Plc. defaulted in meeting its obligations under the agreement, noting that as a result, the bureau has made several demands on ASL, which has not been met till date.

Ndubuisi Francis

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