The Nigerian National Petroleum Corporation (NNPC) and the United States Trade and Development Agency (USTDA) have signed a $1.1 million grant as part funding for the NNPC-Abuja Independent Power Project (IPP) modelled to generate 1,350 megawatts (MW) of electricity to alleviate the power challenge in the country.
The signing between the NNPC, the USTDA and General Electric (GE) took place on Tuesday at the ongoing Nigeria International Petroleum Summit (NIPS) in Abuja.
Mele Kyari, group managing director of the NNPC, signed on behalf of the NNPC while Mary Beth Leonard, United States ambassador to Nigeria, signed for the US agency.
Kyari said the plan by the corporation to build the 1,350MW power plant in Abuja was part of the national strategy to monetise the abundant natural gas resources in the country.
Thomas Hardy, acting director, USTDA, said the $1.1m is the investment of the USDTA for the feasibility studies that will drive and make case for the bankability of the project.
“The goal of USTDA is to make sure the project is viable and in a way that will increase the likelihood of implementation financing whether it’s from World Bank or the Export Import Bank,” Hardy said.
He said the fund the USTDA is investing in the project does not require counterpart funding from Nigeria as the agency has made a 100 percent commitment to the project.
BusinessDay findings show that the Abuja 1,350MW Independent Power Plant (IPP) would leverage on the existing huge natural gas resources from the NNPC Upstream and the proposed Ajaokuta-Kaduna-Kano (AKK) gas pipeline to boost the nation’s revenue base and generate employment opportunities for the youth.
The project would sit on a 54.7-hectare land in Dukpa, Gwagwalada Area Council of the Federal Capital Territory (FCT).
Apart from generating 1,350MW into the national grid, the project would help to decongest the over-voltage on transmission network coming from closely located power generating companies in the gas producing areas.
It was also gathered that the project would be co-financed by the NNPC and its strategic partner, GE/CMEC, with a combination of debt-equity sharing ratio of 70 percent:30 percent.
So far, effort had been put into developing the Environmental Impact Assessment (EIA) of the project.
OLUSOLA BELLO & HARRISON EDEH, Abuja
