World Bank Okays Progress In Power Sector

World Bank Okays Progress In Power Sector

The World Bank says it is satisfied with the progress recorded in Nigeria 's power sector, six months after the launch of the roadmap.

World Bank Senior Energy Specialist, Mr. Erik Fernstrom, said in London on the sideline of the Electric Power Investors' Forum, that the World Bank was pleased with the Nigerian government's Power Sector Roadmap and the progress made so far.

Fernstrom, of the Energy Unit-AFTEG Nigeria Country Office said within six months the road map had already generated an impressive momentum both in the privatisation and reform of PHCN.

Investors have shown interest

He said that the roadmap had made efforts to woo investors to build power plants and regulate the market.

Fernstrom was optimistic that the momentum would also enable gas flow through the power plants and that new investment could be made in gas fields.

Meanwhile, the Bureau of Public Enterprises (BPE) says it is encouraged by the strong interests shown by investors on the proposed sale of electricity distribution companies and power stations in Nigeria . 
 
The Director-General of the privatisation agency, Ms. Bolanle Onagoruwa, gave the indication during a chat with newsmen in New York , after a meeting with prospective investors.  
Similar meetings were held last week in Dubai and London and the BPE team will be in Johannesburg , South Africa next week.
 

''We have had very strong feelers from investors in Lagos , London and
Dubai . We have had a feel of potential investors, fund managers, private equity fund managers and basically there is a lot of interest,'' she said.
 
Investors raise technical questions

Reports  says that timeline for the power sector reforms, sets February 18 deadline for expressions of interest for the proposed sale of 11 distribution companies, two thermal generating firms and two hydropower stations.
 
The government believes that privatisation of the sector, backed with increased investment, will turn around Nigeria 's epileptic electricity supply.
 
According to the BPE boss the preferred investors had concentrated more on technical issues than political concerns. 

'' I must confess that their questions were more technical than worries about the political. The questions have centred on fuel sources and regulation; and these are issues that they require comfort about and to a large extent we have been able to answer the questions... They are more concerned about whether we are going to have enough gas supply, will the gas supply agreement be in place. Those are the things that they are more concerned about,'' she added.

Ensure secure transactions  
Mr. Neal Rich, a prospective investor representing JNL, a US-based company, urged government to ensure ''secure transactions'' for those interested in distribution companies and security of the pipeline on generation.

''From a distribution perspective, there has to be a guaranteed rate of returns and reliable power supply.  On the generation side, our principal interest is security of the pipeline and that is not a financial incentive, but security of gas supply is very critical to making the project work,'' he said.
 
Rich, however, commended the power sector reforms saying '' we see Nigeria as a great place to work for the people.''
 
Another prospective investor, Mr. Omotayo Idowu of a US based firm, Desmear Systems Inc., said government must ensure that competent investors emerged from
the exercise.
  
The 11 distribution companies up for sale are located in Abuja , Benin , Enugu , Eko, Ibadan , Ikeja, Port Harcourt , Jos, Kaduna , Kano , and Yola. 

The thermal power stations are Ughelli Power Plc, in Delta and Geregu Power Plc in Kogi.
 
The hydropower companies, for which concessionaires are sought, are Kainji Power Plc, comprising power stations in Niger and Kwara states in north-central Nigeria and Shiroro Power Plc, also in Niger state.

NAN/Margaret/Yinka