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$16bn Power Project: Obasanjo Releases EFCC Report

Chief Olusegun Obasanjo

Chief Olusegun Obasanjo

Former President Olusegun Obasanjo, yesterday made public the report of the investigation conducted by the Economic and Financial Crimes Commission (EFCC) in 2007, on various allegations, including that of the alleged $16 billion power project.

The report, contained in a 20-page paper, was the outcome of investigations based on petitions written by former Abia State governor, Orji Uzor Kalu and the Coalition Against Corrupt Leaders (CACOL) and signed by its Chairman, Mr. Debo Adeniran in 2005 and 2007 respectively.

The report which was made available by the former President’s Media Aide, Mr Kehinde Aknyemi, noted that the former governor failed to meet with the investigation Panel to supply evidence to substantiate the allegations he raised.

Part of the report noted that “this was followed by series of telephone calls to all his houses both in Nigeria and abroad. A final appeal, through the publication of the invitation, was made in newspapers. All these spirited efforts were un-acknowledged as Chief Kalu declined the repeated invitations. The second petitioner, the Chairman of CACOL, Mr. Debo Adeniran appeared before the Commission in Lagos and threw more lights on his write-up.”

The report also showed that on the power project allegation, “in the period under review, a total of N10, 776,493,271:84; $69,808,942:70; Euros 12,853,883:40 and UKP 8, 987,322:00 were paid to the various contractors. However, outstanding payments for the contractors stand at N11, 520,669,195:53; $375,435,687:37; and Euros 7, 257,552:91 pending the completion of the project.

“Further investigations also revealed that National Integrated Power Project is currently apace in six zones of the country for which about N1, 230,949,066,528:99 was committed by the federal government. The projects are also at different levels of completion but as at the moment of this report, N360, 714,147,700:03 have been paid out to contractors, leaving a balance of N870, 234,918,828:06 yet to be paid pending the completion of the project.

Meanwhile, following representations made by some civil society groups, the Economic and Financial Crimes Commission (EFCC) has reportedly constituted a team to probe the controversy surrounding the $16 billion allegedly spent on power projects. EFCC source, said a team in EFCC has begun work on the files and papers already, noting that some highly placed persons will be invited for interaction.

The EFCC may also conduct a forensic and comprehensive investigation into the alleged $16 billion power projects. The investigation, our source revealed will be focused on the total cost of the projects, how much was withdrawn from the Excess Crude Account (ECA), the total number of contracts awarded, the extent of compliance with due process and the status of the execution of all the projects.

It would be recalled that many issues were raised for investigation by the House Committee, which was headed by Hon. Ndudi Elumelu such as “all NIPP payments were made without following due process, no meaningful progress was made in the execution of power contracts, officials rushed to pay contractors in full even before engineering design for the projects have been completed and approved NIPP contracts were not only overpriced in comparison with PHCN contracts, they were also wide off the mark,

Widespread evidence of systematic over-scoping of projects in order to inflate costs both in PHCN and NIPP NIPP Distribution EPC contracts were awarded at costs averaging about 10 times the norm when compared to PHCN contracts.” The Ndudi Elumelu Committee was put in place by the House on January 31, 2008 to look into how much was spent on power projects. In its report, the committee said that about $13.278 billion was spent on power projects between 1999 and 2007. The committee recommended termination of 13 contracts and review of 10 projects and about 15 contracting and consulting companies were asked to be investigated by the appropriate agencies.‎

Read More at: https://leadership.ng/2018/05/28/16bn-power-project-obasanjo-releases-efcc-report/

CBN Head Office
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CBN funds 704,928 electricity meters, 500 transformers

The Central Bank of Nigeria has provided funds to power distribution companies for the purchase of 704,928 meters and for the acquisition and installation of over 500 transformers.

In a bid to avert the collapse of the country’s power sector, the bank has also paid more than N24bn to gas suppliers and rehabilitated over 2,000 kilometres of 11kV lines and 130km of 0.45kV lines.

The CBN said its intervention in the power sector was through the Nigerian Electricity Market Stabilisation Facility, as captured in the NEMSF Progress Report, which was presented to operators in the industry at the 27th power sector monthly meeting.

The report, which was obtained by our correspondent from the Federal Ministry of Power, Works and Housing in Abuja on Monday, stated that the facility also helped the Discos to provide N13.78bn of security cover to the Nigerian Bulk Electricity Trading Company and the Market Operator as required under the vesting contracts/market rules.

It stated that other outcomes of the intervention include “the purchase of 704,928 metres through the facility, purchase and installation of over 500 transformers to enhance the distribution networks, and over 2,000km of 11kV lines and 130km of 0.45kV lines were rehabilitated.”

It added, “More than 1,000 megawatts of generation capacity was recovered, 56 substations were rehabilitated/constructed, and over N24bn has been paid to gas suppliers to ensure adequate supply of gas to the Nigerian power sector.”

Following the privatisation of the electricity supply industry in 2013, it has had to grapple with several challenges, chief among which is revenue shortfalls.

The shortfalls, which had risen to N210bn by December 2014, threatened the survival of the industry and by extension, the Nigerian economy.

“In order to prevent a collapse of the industry, the CBN intervened to provide liquidity and stabilise the sector through the Nigerian Electricity Market Stabilisation Facility,” the bank stated in the latest NEMSF progress report.

It noted that the core objectives of the facility was to reset the economics of the power sector by way of providing liquidity to the industry by settling the debt overhang that arose during the interim rules period as a result of revenue shortfalls during that time.

The report stated that it was the apex bank’s aim to also bring about a contract-based electricity market where participants were being governed by market rules and instill discipline, as well as facilitate tangible improvement in power supply across the country.

On disbursements and repayments from the NEMSF as of May 14, 2018, the report stated that the total amount was N210.63bn, out of which N158.74bn had been disbursed, representing 75 per cent of the fund. It added that N19.35bn had been repaid, leaving an outstanding balance of N139.39bn.

The apex bank said, “The outstanding disbursement of N51bn under the facility is mostly as a result of the Kaduna and Yola Discos that are yet to fully sign on to the facility. Efforts to sign on these Discos are already been intensified as both Discos have made remarkable progress in this regard.”

“The CBN is desirous of unlocking more liquidity into the industry and is providing the necessary support to these Discos to ensure that they are on-boarded to the facility within the year.”

Culled from The Punch