By Sebastine Obasi
US-based electricity giants, General Electrics in the recent time has signed, but opinions vary on the salutary effects of these agreements in terms of sustainable power delivery to Nigerians.
Fourteen months after signing a funding agreement with the United States EXIM Bank, Nigeria and some companies in the power sector are fast cashing in on the emerging opportunity to grow the wobbling electricity situation in the country. The need to utilise the funding opportunity may not be unconnected with the rating of Nigeria, as one of the nine countries in the world that EXIM Bank identified as offering U.S. companies the greatest opportunities for sales.
The others are South Africa, Turkey, India, Indonesia, Vietnam, Brazil, Mexico, and Colombia. Consequently, Nigeria signed a $1billion (N158 billion) deal to boost the power sector in the next five years.
Part of the agreement was to establish a manufacturing/assembly and training facilities in Calabar, Cross River State. The agreement would also take care of additional investment in the service workshops in Port Harcourt and Onne, both in Rivers State.
Olusegun Aganga, Minister of Trade and Investments, signed the Memorandum of Understanding (MoU) on behalf of the Federal Government while the Global Chairman/Chief Executive Officer of GE, Mr. Jeff Immelt, the signed on behalf of the company, at a ceremony held at Transcorp Hilton Hotel, Abuja.
Following the footsteps of the Federal Government, some other operators in the sector signed similar agreements with GE. They include; Geometric Power Limited, promoted by Prof. Barth Nnaji, the immediate past Minister of Power, Tanscorp Ughelli Power (TUP), a subsidiary of Transnational Corporation of Nigeria Plc, Honeywell Group and Dangote Industries Limited.
While Geometric Power signed a MoU with GE for the construction of a 450MW power plant in Aba, the commercial city of Abia State for $500 million, the deal with Honeywell would generate 150MW. It is intended that GE would supply the turbines for building its plant.
The agreement with Dangote Group covers projects for the design, production and sales of GE aero-derivative gas turbine power generation packages in Nigeria and other selected countries in Sub Saharan Africa, strategic cooperation in the independent power production sector in Nigeria with GE serving as a technical partner/potential investor and Dangote Group as financial investors.
The various agreements signed between GE and Nigeria, together with operators in the power sector are expected to increase the electricity megawatts and engender general development in the country.
While some of the agreements were long term, others were medium term. Peter Esele, President General, Trade Union Congress, TUC, said that while the Congress welcomes the idea of signing agreements, the bottom line is the availability of electricity to Nigerians.
According to him, Nigeria has had other agreements before now and yet power is yet to improve. “The bottom line is availability of power. Look at the agreement signed with Manitoba. Up till now, they have not been allowed to start. Will those in the system allow the GE contract to work? There is too many pecuniary interests instead of making sure there is availability of power,” he said.
In his reaction, Bede Opara, President General of Senior Staff Association of Electricity and Allied Companies (SSAEAC), said it is a welcome development as the country needs massive investment and improvement in the power sector. “We want the best for this country. It is a welcome development, but let it not be a white elephant project. If it is executed properly, it will improve the electricity situation in the country,” he said.
When asked if the agreement would not amount to monopoly, Opara said that the issue of monopoly should be ruled out. “There is no monopoly. GE is expected to build power plants. It is still part of privatisation,” he said.
Comments are moderated. Please keep them clean and brief.