The federal government on Monday issued Transcorp Power plc, owners of Ughelli Power PLC, a certificate of discharge, delisting the company from the list of Power generating enterprises under its monitoring and evaluation ( M&E) policy.
This is just as the company has overshot its mandatory capital investments from N58.6b, under the covenant established for phases 1 and 2, in the Post Acquisition Plan (PAP), by N25.25b to N83.85b.
The Director General of Bureau for Public Enterprises (BPE) Alex Okoh, while speaking at the presentation of discharge certificate, presided over by Vice President Yemi Osinbajo at the Presidential Villa, Abuja on Monday, revealed that the company has also achieved “ all the agreed benchmarks under the human resources, health and safety environment and corporate social responsibility”.
Under the mandatory monitoring exercise, the BPE is authorised to initiate the discharge from the monitoring regime, should the enterprise be adjudged to have met the terms of the performance agreement.
The enterprise can also formally request for a delisting once its key performance benchmark has been met.
Okoh noted that “ Following the capacity determination and validation of the Ughelli Power plc by the consultants engaged by the National Council on Privatisation ( NCP), it was determined that generation capacity has increased by 227% from the operational status of 300 megawatts at the point of handover in 2013.
“The company has achieved an available capacity of 680.8 megawatts, which surpasses the minimum performance target of 670 megawatts.
“Your Excellency, having exceeded the minimum target, and fulfilled all the agreed obligations, the NCP at its meeting on April 4, 2023, considered and approved the recommendation of the BPE and requested that the company, Ughelli Power plc, be approved for delisting from routine monitoring.”
Osinbajo who described the achievements as “ heart warming” stated that the NCP was conducting power matters from beginning to the end and it was successful very often, despite the hiccup.
“What we’re doing today is the delisting of Transcorp Power PLC from the routine evaluation and monitoring of the BPE,” he said.
The routine evaluation and monitoring is as we’ve heard already from the DG BPE, an important feature of the post acquisition plan by the BPE and it has covenants and deliverables which the enterprise is supposed to live up to.
We found in this case, that Transcorp Power PLC has done exactly that. We have been able to ensure compliance with all of the deliverables and in some cases even exceeding the covenanted deliverables in the Post Acquisition Plan (PAP).
So this is both an opportunity to commend the management of Transcorp Power PLC, led by Tony Elumelu and members of the Transcrop power team and also to commend the BPE for doing an excellent job of monitoring and being able to come up with an objective not just a set of criteria, but also an objective means of deciding that we’re able today to delist the Transcorp Power Plc.
He also commended Transcorp Power for being able to deliver efficiently and its ability to do so even way beyond the expectations of the PAP.
Osinbajo while describing the country’s power needs as “ grave” added that “ we strongly believe that the right approach is the privatization of the power sector to enable serious minded private sector players to invest in the provision of public power and ensure that they are efficient while they make profit at the same time.
“We hope that this will not be the last in the series of private power companies that are taking over power plants that are unable to meet the expectations of the post evaluation plans”
The Chairman of Transcorp Holding plc, Tony Elumelu, in his remarks after the event, commended the Vice President and the federal government for the confidence and trust reposed in the company, and assured that the company will not disappoint Nigerian people and the federal government.
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“We at Transcorp Group recognize the importance of improved access to electricity. We know that with improved access to electricity, people can go to school, hospitals can function well, businesses can operate very well and most importantly can empower the industrialization of our country.
“This is why we invested in power and why we continue to invest in the power sector because we know it holds the key largely to the success of our country.
“Mr Vice President, let me also say that in addition to the criteria set, we actually are doing a very strong Indigenization of Transcorp Power Plc. I’m proud to say that our power plant is managed and operated 100 percent by Nigerians.
“I am also proud to say that safety standards are extremely high, we have operated since 2013 with no incident and we hope and pray that it will be sustained because we know the importance of safety and sustainability in today’s world.
“ We have not grown alone, we have grown together with our community. We have functional hospitals, schools – primary and secondary schools and we do engage a lot with the community and have helped to create jobs for our people.
“So, we are happy to be on this journey with the federal government and we want to do more in this sector.
Ughelli Power plc was listed under the first schedule, part one sub section of the public enterprises privatisation and commercialization Act of 1999, which provided for a private sector led management of power generation activities in Nigeria, as contained in the BPE framework of 1999.
The section also allows the private sector play a more predominant role in leveraging financial and management capacities
Ughelli Power plc, which was one of the six Gencos privatised by the federal government, is a gas powered thermal plant located in Delta state and was commissioned in 1966 with an installed capacity then, of 900 megawatts.
BusinessDay gathered that the available capacity at the point of privatisation was 300 megawatts
The Consortium of Transcorp Ughelli Power limited had emerged as the preferred bidder and core investor, thereby acquiring 100% of federal government equity of the Ughelli Power plc, in 2013, during the power privatisation exercise
The company had then committed to achieving specific improvements target over a five year lock in period, covering five key areas, including, available capacity, capital expenditures, human resources, health safety and environment and corporate social responsibility .
In pursuit of the objective of the privatisation program and ensure effective and efficient management of the privatized power utilities in the generation segment of the value chain, the BPE implemented a five year exercise, designed to determine the level of performance of the respective core investors and assess their level of compliance with the operational thresholds and covenant enshrined in the performance agreement.
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