Power sector privatization to yield N200billion

Private companies interested in buying any of the Nigeria’s 11 power generating companies (GENCOS) have until July 17 to submit their technical and financial proposals, the Bureau of Public Enterprises (BPE) said on Wednesday.

The BPE Director-General, Bolanle Onagoruwa also announced July 31 as the deadline for submitting bids for the six distribution companies (DISCOS).

The generating and distributing companies make up two of the three successor companies of the Power Holding Company of Nigeria (PHCN).

Already, the privatisation bureau has released the revised industry and transaction agreements to the shortlisted 152 potential investors that have indicated their interest to participate in the privatisation of the companies.

The industry documents include Gas Sale and Aggregation Agreement, Gas Transportation Agreement, Bulk Power Purchase Agreement (Thermal), Bulk Power Purchase Agreement (Hydro), Vesting Contract, Transmission Use of System Agreement, Grid Connection Agreemen,; and Ancillary Services Agreement, while the transaction documents include the Share Sale Agreement, Shareholders Agreement, Performance Agreement and Concession Agreement.

Ms. Onagoruwa, who was giving an update on the progress so far, said the Bureau was going ahead with privatisation work plan despite delays in the release of the capital budget.

“The evaluation of proposals for the GENCOS will be concluded by August 14, 2012, while that for DISCOS will be concluded by August 31, 2012,” Ms Onagoruwa said while explaining that “NCP (National Council on Privatisation) approval for the evaluation of the GENCOS will be sought on August 28, 2012, while that of the DISCOS will also sought on September 11, 2012.”

The BPE boss further explained that September 18, 2002 has been chosen as the deadline for the submission of post-qualification security for GENCOS while October 2, was chosen for DISCOS. The opening of the financial bids for the GENCOS is September 25, 2012, while for DISCOS is slated for October 10, 2012.

The final approval of the preferred bidders by NCP and its announcement for the successor companies is expected to be done on October 9, 2012 for the GENCOS, and October 23, 2012 for the DISCOS.”

Ms. Onagoruwa explained that the Bureau hoped to generate over N200 billion from the privatization of the unbundled PHCN

According to the BPE boss, the bulk of the revenue that would be generated would come at the conclusion of the on-going power sector reform; while the privatisation of the power companies has already started yielding fruits, with over N1.2 billion realised as privatisation proceeds for 2012.

The privatisation chief also stated that her bureau had completed discussions with the Attorney General of the Federation (AGF) in order to fine-tune the seven power sector reform bills.

“I want to report that all the bills are ready,” Ms Onagoruwa announced. “The Legal Committee of the NCP (National Council on Privatisation) is having a final look at them before sending them back to the FEC (Federal Executive Council) for the final approval and submission to National Assembly for passage into law.”

The fine-tuned bills are: the Railway bill, Inland Waterways bill, Federal Competition and Consumer Protection bill, Postal bill, Road Sector Reform bill, National Transport Commission bill, and Ports & Harbour Reform bill.

The objectives of the bills include providing an enabling legal and regulatory framework for the institution of the reform sought, attracting private sector investment and participation in the various sectors, creating a level playing field for all private sector entrants into the different sectors, creating a viable environment for investors to recover their costs and have a reasonable return on their investments, and redirecting funding by government to other key sectors like health and education that have been neglected.


NEVER MISS A THING AGAIN! Subscribe to our newsletter

* indicates required


Now available on

  Premium Times Android mobile applicationPremium Times iOS mobile applicationPremium Times blackberry mobile applicationPremium Times windows mobile application

TEXT AD: To place a text-based advert here. Call Willie - +2347088095401

All rights reserved. This material and any other material on this platform may not be reproduced, published, broadcast, written or distributed in full or in part, without written permission from PREMIUM TIMES.