Investment Business - News - November 15, 2022

Privatisation Council approves governance framework for proposed $3bn hydropower plant in Benue

By Bassey Udo

The National Council on Privatization (NCP) on Monday approved a governance framework for the development of a $3 billion hydropower plant proposed for Makurdi, Benue State.

The approval was one of the highlights of the meeting of the Council presided over by Vice President Yemi Osinbajo at the Presidential Villa in Abuja.

With the NCP’s nod, the development of the project, would now proceed through the Public Private Partnership arrangement subject to compliance with all existing laws, including the Public Procurement Act.

The project, which is expected to be the largest hydropower project in West Africa, would be the first of its kind in the country and would supply over 1,650 megawatts of electricity.

Under the NCP approved Governance Framework, a PPP procurement process was adopted, with proponents of the proposal and other interested investors to participate in a transparent bidding process.

A statement from the VP’s office said a Project Steering Committee of the NCP would provide leadership and high-level support to ensure the success of the transaction.

The membership of the committee includes the Minister of Power, Abubakar Aliyu, as Chairman, with Water Resources Minister, Suleiman Adamu as Co-Chair, and the Director General of the Bureau of Public Enterprises (BPE), Alex Okoh, as Vice Chairman.

Other members drawn from the Ministries of Justice, Environment, Agriculture, representatives of the Infrastructure Concession Regulatory Commission (ICRC); Nigerian Bulk Electricity Trader (NBET), and Transmission Company of Nigeria (TCN).

Benue, Nasarawa and Taraba State governments would also have representatives, while the Director of Infrastructure & PPP at BPE would serve as Secretary of the committee.

The statement said a Transaction Adviser of international repute would also be engaged for the project to assist BPE.

During the Council meeting, updates were received on the Zungeru Hydroelectric Power Plant, with notification of the investors’ interest in the concession of the plant.

The Infrastructure Concession Regulatory Commission (ICRC) has already issued a Certificate of Compliance in respect of the Outline Business Case (OBC) submitted for the project.

The Project Delivery Team held a meeting in September 2022 and reviewed the documents after the Transaction Adviser submitted the documents, including the Strategy paper, Inception Report, and Request for Qualification.

Regarding updates on the situation with the Electricity Distribution Companies (DISCOs), the Council was informed of the intervention and restructuring of Kano, Benin, Kaduna, Ibadan and Port Harcourt DISCOs.

The notification for change of directors of those DISCOs has now been fully filled to the Corporate Affairs Commission, reflecting the takeover of the 60 percent shares by the lenders in three out of the five DISCOs, namely Kaduna, Kano and Port Harcourt.

The Council was informed about ongoing filings for Ibadan and Benin expected to be completed soon.

In addition, the Asset Management Corporation of Nigeria (AMCON) issued an advert last week for the sale of 60 percent of the shares of Ibadan DISCO.

The NCP has also approved the appointment of Sutura Aisha Bello, as a Director for Infrastructure and PPP in the Bureau of Public Enterprises.

The meeting had in attendance council members, including Minister of Industry, Trade and Investment, Adeniyi Adebayo; Minister of Power, Abubakar Aliyu; Agriculture and Rural Development Minister, Mohammad Mahmood Abubakar; the Director-General of the Bureau of Public Enterprises (BPE), Alex Okoh; representatives of Federal Ministries, heads of relevant MDAs and other senior government officials.

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