NNPC mulls buying government-owned power plants
The Nigerian National Petroleum Company Limited has signalled interest to bid for the National Integrated Power Plants (NIPPs) put up for sale by the Federal Government.
Mele Kyari, managing director of NNPC, disclosed this during a visit with his team to the Bureau of Public Enterprises (BPE) in Abuja.
Kyari said the national oil company was determined to boost power generation and distribution through increased investment.
The Federal Government, through the BPE, had since last year planned to divest 100 percent of its shareholding in five of the NIPPs currently being run by the Niger Delta Power Holding Company (NDPHC), to finance budget deficit.
The NIPPs include Geregu Generation Company Ltd, Kogi; Ihovbor Generation Company Ltd, Benin; Calabar Generation Company Ltd, Cross River; Omotosho Generation Company Ltd, Ondo; and Olorunsogo Generation Company Ltd, Ogun.
It is not clear yet which of these power plants that the NNPC would be interested in, but BusinessDay gathered that the combined capacity of these power plants is about 2,300 megawatts.
According to Kyari, the NNPC has the required expertise and experience to be an active participant in the power sector in Nigeria.
The new Petroleum Industry Act transformed the Nigerian National Petroleum Corporation into a commercial entity registered under the Companies and Allied Matters Act.
The company recently signed a contract with China Machinery Engineering Company and General Electric to provide 50MW of electricity to Maiduguri, Borno State.
Kyari said the management of NNPC was determined to run the power plants efficiently and profitably for the benefit of the shareholders, and would engage in activities that would generate funds.
“NNPCL is a partner of choice,” Kyari said.
Alex Okoh, director-general of BPE, acknowledged NNPC’s interest in the NIPPs and assured that the company would be given a level playing field with the other bidders during the sale process.
Okoh added that the National Council on Privatisation would be notified of the desire by the NNPC to bid for the NIPP plants.
Bala Zakka, energy consultant and technical director, Template Design Limited, says the NNPC, with its new status as a limited liability company, is at liberty to invest in any sector where it can make profit and minimise cost.
He, however, said the move might not be in the best interest of the country at the moment.
“The move for me is completely off the track and a distraction from its mandate,” Zakka told BusinessDay. “The mandate of the NNPC as the government oil company is at stake; it will be expected to minimise cost while increasing profits.”