Published on : Aug 24, 2015
It is being said that foreign companies from China and the U.S. will invest more than US$14 billion for the continuation of the second phase of construction of NIPP (National Integrated Power Project). NIPP was started in the year 2004 as a fast-track project to develop a strengthened level of power generation capacity to Nigeria’s electricity industry.
This phase of construction includes the building of 10 small hydropower plants, large hydropower plants such as Gurara II and Mambilla, equipment, and distribution and transmission facilities.
The State Grid of China/CET/Westron had earlier said that they will provide funds worth nearly US$8 billion in their first part of investments and will put in a further US$4 billion based on equity participation loan terms in the company Transmission Company of Nigeria through the holdings firm Niger Delta Power Holding Company (NDPHC) with a nearly US$600 million contributions from NDPHC, which also oversees the projects in NIPP on the behalf of the governments.
It is also being said that the U.S.-based company Africa Group has also pledged to invest nearly US$2 billion in the power projects being undertaken in Nigeria using the company NDPHC as a pivot. Some more interested investors are also committed to financing smaller projects related to transmission that fall in the range of US$50 million and 200 million.
The NIPP has two phases of implementation of which the National Economic Council has approved the construction of a few hydroelectric plants and the work of strengthening the transmission network from the profits following from the sale of nearly 80% shares in the NIPP projects.
However, so far no payments have been received due to sale of shares owing to factors such as market bankability and gas limitations. Thus, the phase 2 of NIPP could not start as it was planned. Earlier, the many limitations hovering before the NIPP projects had also prompted many bidders in withdrawing their bids, but now the situation has become a bit better.