Investors to take over power firms July 2013

67 Views Comment Off


Power Holding Company Nigeria

Power Holding Company NigeriaThe preferred bidders for the country’s power generation and distribution firms are expected to take control of the companies between June and July next year, the Bureau of Public Enterprises has said.

The Acting Director, Electric Power Department, BPE, Mr. Ibrahim Babagana, said this on Wednesday at a workshop on the Nigerian capital markets, which was held in Lagos.

According to him, the BPE plans to start negotiations with the five preferred bidders for the generation companies and 10 for the distribution companies from the first week of December to January 2013, after which the process of transferring the companies to the bidders will commence proper.

Babagana said, “Our intent is to conclude the execution of the legal documents by mid next year. So, by mid next year, around June and July, the bidders will take over. Prior to that, we are trying to put up transitional arrangements in collaboration with the preferred bidders and the managers of the companies.

“So, that is when we will conclude and they will sign the legal documents and make payment in full; thereafter, they will take over seamlessly without any problem.”

He explained that to succeed in that regard, certain issues such as labour and other related challenges needed to be resolved.

Concerning the expected changes in the power sector after privatization, Babagana said, “I anticipate that if we hand over a plant and there are no Nigerian factors coming up, we should start seeing improvements, to be realistic, in the next two years. What is important is first, let us try and hand over and make sure that private sector operators take over.”

The BPE chief also said Manitoba Hydro International would continue as the management contractor for the Transmission Company of Nigeria, confirming what President Goodluck Jonathan said during a television chat on Sunday.

The Canadian firm had in April emerged successful in its bid to manage the TCN for three years, but rather than get the delegated authority it required to work, the Presidency on November 14 announced the cancellation of the contract, a development that had generated controversy.

Announcing the cancellation, the Special Adviser to the President on Media and Publicity, Dr. Reuben Abati, had said the contract was awarded by the BPE and not the National Council on Privatization as Nigerians were made to believe.

“Yes, the President has cancelled the contract because it was not done in accordance with the Public Procurement Act. The President has directed that a new process for the selection of the management contractor should begin immediately and should be completed in 30 days in order not to cause unnecessary panic,” Abati had told The PUNCH.

Following the announcement, many people expressed fears about the planned privatization with stakeholders in the industry alleging that some influential people, who wanted an Asian company to be awarded the contract, had pressured the Presidency to cancel the contract.

However, during the presidential media chat on Sunday, Jonathan contradicted Abati, saying the contract had not been cancelled.

Corroborating Jonathan’s statement, Babagana said, “The issue of the Transmission Company of Nigeria, which was embroiled in controversy, has been resolved.

“The Bureau of Public Procurement yesterday (Tuesday) issued us with a no objection and the contract has been resolved with Manitoba having to continue as the management contractor for the Transmission Company of Nigeria.”


In : Business

Related Articles