FG Licences 3 Power Generation Companies

Supertek Nigeria Limited, run by Mr. Joshua Gana, son of former Information and National Orientation Minister, Professor Jerry Gana, and three other private independent power companies were yesterday presented with Federal Government licenses empowering them to undertake electricity generation in the country. The three others are Farm Electric Supply Limited, which would be managed by a foreigner, Mr. Alistair Morrison, Ethiope Energy Limited, owned by Chief Olubiyi Sangowawa, and ICS Power Limited under the tutelage of Engr. Sam Uzoukwu. Supertek Nigeria Ltd will be located in Akwete in Abia State and is expected to produce 1000MW while Farm Electric Supply Ltd, will operate from Ota, Ogun State and was allotted 150MW.

Similarly, ICS Power Ltd, based in Alaoji, near Aba in Abia State is to generate 624MW and Ethiope Energy Ltd, situated in Ogorode, Sapele, Delta State, would produce 2,800MW. Minister of Power and Steel, Senator Liyel Imoke, who presided over the event, disclosed that with the additional capacity from these new companies, when merged with expected capacity of the various on-going Federal Government-sponsored integrated power projects, the country may well be on its way to meeting a target of 15,000MW national capacity by 2010. "With the generation capacity of over 4,000MW which will be added by these new licensees in the next few years, the country will certainly be making a big step towards achieving the target of 15,000MW by 2010", Imoke stated. According to the Nigerian Electricity Regulatory Commission, (NERC), these companies which had successfully scaled through the commission's technical and financial evaluation, will be adding a total of 4,574MW of electricity to the national power grid when their projects are completed.

One outstanding feature of the event, according to NERC, was that all the four companies are owned by Nigerians. Speaking at the presentation of the licenses in Abuja, Imoke also said the fact that the first four IPP companies to be licensed are all indigenous companies is a reflection that Nigerians are rising up to the challenge of developing the power sector. He said the Federal Government has responded to this initiative of local entrepreneurs by setting up a committee charged with the task of evolving a power sector specific incentive package to encourage more private sector investors into the electricity industry. "The President has established a committee on power sector specific incentive package under the chairmanship of NERC Chairman, Dr. Ransome Owan, to structure these initiatives", said Imoke. The committee is to conclude deliberations within one month and is expected to submit its report and recommendations by end of September, he said.

While commending NERC for facing up with the unique challenges of the power sector regulation, the minister noted that "an efficiently regulated power sector is 'sine qua non' for attracting private sector investment in the sector". Most of the Chief Executives of the new licensee firms, who spoke to THISDAY shortly after the ceremony said they hope to commence power generation within the next 2 years. The companies also said they would adopt a new technology in power generation known as 'Combine Cycle" method which would avail them the benefit of utilising both gas and ethanol energy sources to power their turbines. The Chief Executive Officer of Supertek Nigeria Ltd, Mr. Joshua Gana told THISDAY that the compamy intends to roll-out within the next two years. Managing Director of Ethiope Energy, Mr. Olubiyi Sangowawa called on government to assist the companies in cushioning the effect of the high risks involved in power projects through special incentives such as import duty waivers and gas price concessions. He also sought for a tax holiday of between 5-10 years for the pioneering power generation companies. He said the company would be making an investment of over $400m for it to achieve 1000MW target, adding that the first firing which will come in the next 12 months will gulp about $100m. Director-General of the Bureau for Public Enterprises, Mrs. Irene Chigbue, said Federal Government is in the process of putting up the necessary framework for a vibrant power sector, adding that the next stage of the process would be for the private sector to take up the challenge of setting up power projects.

Culled from Thisday