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Hope dims for stable power supply as N160bn bilateral loan defer to 2022

The hope of Nigerians to get a stable electric power supply has dimmed as the N160 billion bilateral loans for power projects, expected to address the ugly situation, is deferred till 2022.

Abubakar Aliyu, Minister of Power, disclosed this on Thursday when he appeared before the House of Representatives Committee on Power to defend the 2021 budget performance and proposals for the 2022 fiscal year.

Aliyu explained that Mambilla and some other power projects across the country have not been completed due to issues such as legal fireworks.

“It is being told in the press that we have a case on Mambilla. Someone has taken us to court to claim that he was the initial contractor for Mambilla and the Chinese, who are supposed to bring money for the construction withheld their money because of that arbitration and it is not in Nigeria,” he said.

“It has been taken to Paris, where we have been working seriously even before now. And now we have reactivated discussions and we are working on that to see how we can pull down that encumbrance. I would not want to continue to talk about that since it is something that is being negotiated at a certain level.

“Once you say much about it, it may affect what is going on since we have not reached any agreement on anything yet. But we are working day and night to see how we can resolve that issue. The con contract has been signed since 2017, but the financial contract between Nigeria and Chinese was not signed.

“So, nothing about money exchanging on Mambilla as far as the loan is concerned but we are trying hard to see how we can resolve the legal issues, which the Attorney General is heading that team. This is as far as I can say on the issue of Mambilla.”

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Aliyu said the Ministry was working towards reconnecting the villages surrounding the Kashambila power project with electricity, to be able to commission the project, indicating that the project will be ready for commissioning by December.

“It is a project that has 40MW which is ready for commissioning soon. We are looking to commission it in December if everything goes well. What is preventing us from going there to commission is what we call catchment areas, the villages that surround that facility needed to connect with electricity.

“We are working seriously to connect these communities. It is ongoing. The communities that were displaced by the construction of the dam were relocated but they live around that area, between now and December we would be done with it and commission the first phase. The second phase is ongoing, which is the transmission lines from the Kashambilla area to other places. Once we go for the commission in December we would do the groundbreaking of the second phase,” Aliyu said

Speaking on the proposed budget for 2022, he said out of the total sum of N75.462 billion proposed for the main Ministry, the sum of N74.227 billion is for capital expenditure, N249.508 million is for overhead expenditure while N984.248 million is for personnel expenditure.

Responding to concerns on the soar relationship between the Transmission Company of Nigeria (TCN), Generation Companies (GENCO), and Distribution Companies (DISCO), the Minister who acknowledged the impacts of the disagreement affirmed that the sector is mostly privatized.

“Some of the responsibilities are outsourced. Our partners at the generation level, distribution level, and the government is handling the transmission. This is the whole value chain of power generation, transmission, and distribution. And for it to work effectively, all of them must be up and doing.”

“As it is now, we have serious challenges here and there along this value chain. And apart from the three major players, we have an interface, because the generators need fuel either from a natural source, which is the hydro which contributes about 20 percent of the generation.

“So what is going on is that the transmission due to lack of attention on it for a very long time, not now, culminates to the situation we are having on the transmission, whereby they have to deal with obsolete equipment, weak equipment, which needs to be replaced.

Scrutinizing the 2021 budget performance, lawmakers expressed grave concerns over the low performance of the N176.721 billion appropriated for capital projects, out of which N43.240 billion (representing 24.5percent) has so far been released, while N32.518 billion has so far been utilised.

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