FG set to privatize 10 power plants
LAGOS – The Federal Government is to privatize the 10 independent power plants built by the Niger Delta Power Holding Company (NDPHC) under the National Integrated Power Project (NIPP).
Mr James Olotu, Managing Director, NDPHC, made this known at an interactive session with journalists in Lagos.
The power plants are: Omotoso in Ondo State (450MW), Sapele in Delta (450MW), Geregu in Kogi (434MW), Olorunsogo in Ogun (750MW) and Ihovbor in Edo (450MW).
Olotu explained that a road show to indicate the commencement of the exercise would start in Lagos from Tuesday, June 4 to June 5 with 40 investors.
He said that the road show would be extended to United Kingdom, United States and Hong Kong.
The NDPHC boss confirmed that six of the plants had been completed technically, while the remaining would be completed before 2014..
He explained that the Federal Government would divest 80 per cent of its shares in the power plants, while auctioning would involve the Ministry of Power and the Bureau of Public Enterprises.
Olotu, who did not disclose the expected revenue from the auction, said that proceeds realized would be used to build additional power plants and boost transmission lines in the country.
‘With the planned privatization, there would be efficiency and effectiveness in the management of the power plants.
“Government can play its role where it has relative advantage. Government will invest little but more on transmission sector so as to build the country’s power infrastructure,” he said.
Olotu stated that the Board of Directors of the company which has Vice President Namadi Sambo as its Chairman, had got the approval of the Federal Government to privatize the plants.
He said the sale became imperative due to the fact that the company has achieved the mandate given to it in 2005.
“The mandate was to build 10 independent power plants across the country with capacity to generate 5000 MW by end of 2013 and divest it.
“We are confident to tell you that this year will be a year of harvest in the power sector. All the power generating plants will be completed this year.
‘In fact, six plants are ready for commissioning while four others are about to be completed within the next few months.
“We are divesting 80 per cent stake in each power plant as valued by our financial advisers..
‘We will retain 20 per cent in order to assure potential investors of our confidence in the plants we are selling,” he stated.
Also speaking, Mr Arif Mohiuddin, CPCS Transaction Adviser to the NDPHC, said submission of bid for the plants was scheduled for July 19 while August 8 was fixed for short-listing of bidders.
“There will be bidders’ conference on Sept.18 and Sept.19. Bidders are expected to submit their proposals on Nov. 8 and evaluation of technical proposal would come up one month later,” Mohiuddin said.
He said names of successful bidders would be announced, while the handing-over of the assets to the investors would come up before June 2014.
He gave the assurance that the plants would not be handed over until completion and commissioning.