TheDirector General of the Bureau of Public Enterprises (BPE), Benjamin Ezra Dikki, has offered a better explanation concerning the N213 billion intervention fund recently released by the Central Bank of Nigeria (CBN) to power generation and distribution companies in the country saying it is not a grant but revenue accruing to the companies.
Dikki said that from conception of the power sector reforms in Nigeria, it was calculated that 40 to 60 per cent of power generated was lost due to technical faults and inefficiencies in transmission and distribution, occasioned by inadequate investment and poor maintenance culture.
According to him, “these losses that no private sector investor will bear were made good by government via subsidies over an initial three-year period, to give private sector investors time to make the necessary investments to improve the distribution network. Due to revenue challenges, the government could not meet the obligation, hence, the CBN decided to intervene and grant a loan to the power sector market.”
He said the fund is a loan to the power market to enable investors to improve infrastructure. “The CBN, BPE and the Nigerian Electricity Regulatory Commission (NERC) would monitor the utilization to ensure that the power infrastructure improvement was achieved within the next five years, and that the loan is repayable by the market over a period of ten years.”
The DG noted that the greatest challenge facing power generation in the country is gas, adding that previous administrations did not make investment in gas infrastructure until the Goodluck Jonathan’s administration came to salvage the situation.
“In the years gone by, no appropriate attention was given to the issue of gas supply to the power generation companies. No previous government prioritized the piping of gas to the generation companies— hence the situation we find ourselves now.
“It is however gladdening to note that the present administration is doing everything possible to overcome the challenge. The Ministry of Petroleum, the Nigerian National Petroleum Company (NNPC), the gas companies and other stakeholders are working hard to ensure that gas supply to the power generation companies is achieved”, he stressed.
On NITEL/MTEL, the DG expressed confidence that NATCOM, the consortium that bought the enterprises would turn around the moribund companies.
According to him, the consortium is made up of renowned world telecommunications outfits and credible Nigerians “and given the thoroughness they exhibited during the due diligence on the companies and quality of their manpower, coupled with their good business plan, they will not fail.”
He dismissed claims that NITEL/MTEL was undervalued, stressing that the transaction went through a transparent bidding process after adverts in local and international media were placed, inviting investors from all over the world, in line with international best practices.
He reminded critics that before the enterprises were sold, they had remained comatose for about five years and that most of the assets had depreciated.
However, he said the two enterprises were still viable as NITEL is one of the two national carriers with extensive to optic fibre cables networks and has fixed line telephony.
He added that when functional, access to broadband in the country would be greatly enhanced.
On Ajaokuta Steel Company, he said that government was currently unraveling all the legal issues affecting its operations so that the plant could be privatised.
By Yemisi Izuora/Joseph Bakare