BPE accepts Geometric has rights to Aba-Ariaria ring-fenced

The Bureau of Public Enterprises (BPE) has finally responded to BusinessDay reports on Geometric/Aba Power Limited with a press statement that “Geometric Power/Aba Power Limited has a subsisting contract with the Federal Government to generate, transmit and distribute power in the Aba and Ariaria Districts of Enugu Disco for 20 years”.

BPE, in the bid to “put the records straight”, said “there is a Lease Agreement dated 28th April 2005 signed between the Federal Government of Nigeria (FGN), National Electric Power Authority (NEPA) and Aba Power Limited (APL)”.

“This agreement is for the generation, transmission and distribution of power to residential and commercial consumers in Aba and Ariaria Districts that fall under Enugu Zone of NEPA in Abia State. The said agreement which relates to the ring-fenced area in Aba and Ariaria Districts was amended by another Supplemental Agreement dated 31st August, 2006,” BPE said in the statement.

BusinessDay in the past two months drew public attention to the agreement between the Federal Government and Geometric Power and exposed all the intrigues and artificial hurdles from vested interests threatening to kill the 140-megawatt (MW) project.

In its own reaction to the BusinessDay reports, Interstate Electrics in an advertorial put the blame squarely on the doorsteps of the National Council on Privatisation (NCP) and the Bureau for Public Enterprises (BPE), inferring that BPE and NCP should be held responsible for not delineating the Aba ring-fenced area.

“In compliance with the EPSRA 2005, NEPA was unbundled into 18 successor companies. Since Aba and Ariaria Districts fall under the Enugu Disco, the contracts between NEPA and APL were inherited by Enugu Disco, in consonance with the principles of succession of title. Thus, Interstate Electric is the new landlord,” BPE said.

BusinessDay investigations reveal that prior to privatisation, BPE indicated that Aba ring-fenced area was encumbered, yet it included it in its bid, a move that was later tagged “administrative error”, which created a scenario where the leadership of the BPE consistently misled key government officials and the public since they did not do the right thing at the onset by excising the two business units in Aba to Aba Power before offering the remaining 16 business units of Enugu Disco to “their preferred bidder”.

An industry source told BusinessDay that the current BPE management is also aware that after the 2006 Aba Supplemental Lease Agreement was signed, in order to correct the error regarding Enugu Disco prior to privatisation and ensure compliance with the terms of the agreement, their predecessors in the BPE under the Olusegun Obasanjo administration registered Aba Distribution Company plc (Aba Disco) at the Corporate Affairs Commission (CAC) as a 12th Disco, with the Ministry of Finance and the BPE as shareholders.

Sources close to Geometric Power said “the company has decided to focus on resolving the issue quietly, through the president and key decision makers in the power sector, who know the truth, and have visited the project sites and have all recommended unequivocally that the terms of the lease agreement should be fully implemented by the BPE”.

In a quick reaction to the BPE statement, George Ugwu, an engineer and industry player, said, “It is interesting to note that the release of BPE statement on Tuesday night was timed to pre-empt the deliberations and outcome of the National Council on Privatisation (NCP) Technical Committee meeting scheduled the next day, June 4, 2014, at the instance of the vice president, and as a follow-up to the meeting President Jonathan held a couple of weeks ago with the top power sector government officials to finally resolve the Aba ring-fence matter.”

He added that obviously, their goal was “to influence attendees of the meeting who received copies of the BPE press statement to support what they would erroneously perceive as ‘government’s’ position”.

Another industry source cynically commended the BPE for finally accepting that there was indeed an agreement in place for Geometric Power/Aba Power to generate, transmit and distribute power in the Aba and Ariaria Districts of Enugu Disco for 20 years, but urged the bureau to guarantee equity and fairness by ensuring that the sanctity of the lease agreement was respected and maintained, as anything else would amount to grandstanding and gross insensitivity to the long-suffering 2 million residents of Aba.

Frank Uzuegbunam