Five Power Plants to Be Sold by FG for $1 Billion
At a cost of over $1.15 billion, the Federal Government is presently conducting deals for the sale of five power plants under the National Integrated Power Projects through the Bureau of Public Enterprises, it was learned on Tuesday.
The Federal Government of Nigeria (FGN) is planning to sell five power plants under the National Integrated Power Projects (NIPP) to fund the 2023 budget. The BPE, led by Ignatius Ayewoh, confirmed that the transaction is ongoing and that it is not concluded. The five power plants include the Geregu II gas-fired plant in Kogi, the Omotosho II plant in Ondo, the 750MW Olorunshogo II plant in Ogun State, the 563MW Odukpami power plant in Calabar, Cross River State, and the 451MW Benin-Ihovbor plant in Edo State.
The cost of constructing a 1MW power plant varies depending on factors such as type of power plant, location, and technological advancements. For solar power plants, it is between $1m to $2m per MW, while for wind power plants, it is between $1.5m to $2.5m per MW. For natural gas-fired power plants, such as the NIPPs, it is between $1m to $2m per MW, while for coal power plants, it is between $2m and $3m per MW.
In December 2022, the Federal Government and 36 state governors finally agreed to sell the plants under the NIPP and use the proceeds to fund the 2023 budget. The agreement reached after over two years of disputes and legal tussle regarding the sale of the NIPP plants being managed by the Niger Delta Power Holding Company.
The former Director-General of the Bureau of Public Enterprises, Alex Okoh, disclosed the agreement between the Federal Government and the states regarding the NIPP plants to journalists in Abuja during an interview. However, the disclosure was opposed by various groups.
The Nigerian National Petroleum Corporation expressed interest in acquiring some NIPPs in March 2022. In December 2022, the former BPE boss confirmed an agreement between the Federal Government and states for the sale of five NIPPs, projected to generate over N260bn (around $600m). However, some sources and CSOs expressed concerns that this amount wouldn't significantly impact the rising budget deficits at the time. As of today, the sale of the NIPPs has not been finalized, and the Niger Delta Power Holding Company, which manages the NIPPs, has also not confirmed its sale.
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