A $1.1 million pact, expected to generate 1,350 megawatts (MW) Independent Power Plant was yesterday, in Abuja, signed between the Nigerian National Petroleum Corporation (NNPC), and the United States Trade and Development Agency (USTDA).
Expected to be constructed by General Electric and CMEC on a debt-Equity ratio of 70:30 pet cent, the power plant would be powered by gas from the proposed Ajaokuta-Kaduna-Kano (AKK), gas pipeline.
Speaking at the event, Group Managing Director, NNPC, Mele Kyari, who signed on behalf of the Corporation, said the move would ensure that the electricity supply in Nigeria becomes stable.
Nigeria has been faced with lingering challenges of electricity supply, which has stagnated at an average 4,000WM over the past 40 years despite a rapidly growing population.
Also, the nation’s week economic outlook, the standard of living as well as poor business environment have been linked to the epileptic power supply, as citizens rely on generating sets despite the environmental issues.
“We have gas in abundance; we must create an infrastructure that will help create gas for power generation. We need power to create jobs, and we must create prosperity so that we can create peace in our country. We are grateful for this grant,” Kyari said.
He stressed the need to improve electricity supply to power economic growth and development, adding that NNPC’s plan to build the 1,350mw power plant in Abuja, is part of the national strategy to monetise the abundant natural gas resources in the country.
Specifically, the $1.1 million grant would be deployed for the feasibility study that would drive and make case for the bankability of the project, Acting Director USTDA, Thomas Hardy, explained.
Disclosing that the project does not require counterpart funding from Nigeria as the USTDA made a 100 per cent commitment to the project, Hardy said the agency will ensure that the project is viable.
Also speaking, the United States’ Ambassador to Nigeria, Mary Leonard, who signed on behalf of the U.S., disclosed that the grant would help to open up Nigeria’s energy sector.
She said: “The grant will provide the in-depth technical, economic and financial analysis necessary to develop a major new source of energy and exciting 1,350MW natural gas power plant here in Abuja.
“I am excited about this project for many reasons; the first is what successful completion of this project would mean for the greater prosperity of Nigeria, as gas reserves have to date been largely untapped.
“Creating an incredible opportunity for additional production increased domestic utilisation and eventually export to the global marketplace. When completed, this power plant will take advantage of this new domestic resource and help address Nigeria’s existing critical energy needs.”