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The Minister of Finance and Coordinating Minister for the Economy Mr Wale Edun yesterday emphasized the importance of liquidity in resolving the ongoing challenges in the power sector.
The proposal is just as the Managing Director of Niger Delta Power Holding Company (NDPHC), Mr Chiedu Ugbo, informed the Senate Committee on Power that the Calabar Power Generation Company, which is under NDPHC's ownership, is currently the most efficient power plant in Nigeria.
Edun made the proposal during his testimony to the Senate Committee investigating the controversial Makeup Gas (MUG) reprocessing deal involving the Ministry of Finance, NDPHC, Calabar Generation Company Limited, and ACUGAS Limited.
He explained that the Ministry of Finance only became involved in the agreement between NPDHC and ACUGAS Limited in order to facilitate the necessary liquidity, as the contract was originally signed in 2011 during President Goodluck Jonathan’s administration.
Edun also highlighted the Ministry's collaboration with the Nigerian Liquefied Natural Gas (NLNG) to address the liquidity issue by transferring gas payments in dollars through a Deed of Transfer.
He clarified that the focus of the investigation by the Senate Committee on Power was not about restructuring, but rather about addressing the liquidity challenge, which the Ministry of Finance was actively working to resolve.
He emphasized the ownership structure of Makeup Gas (MUG), stating that it belongs to Calabar, which in turn belongs to NDPHC, and ultimately to the Federal and State governments, with the Federal Government holding a majority stake of 52.68%.
In his presentation to the committee, Chiedu Ugbo, the Managing Director of NDPHC, said that the company is currently obtaining gas from three out of five units as a result of the gas supply agreement with ACUGAS Limited.
He also highlighted that the Calabar plant is generating power for the national grid and is considered the best power plant in the country.
Ugbo emphasized that NDPHC went to a great length to build an 80-kilometre gas pipeline to utilize MUG in Calabar and Alaoji power plants.
However, he expressed frustration over issues relating to systemic transition, frequency, and voltage that had prevented the firm from achieving its intended outcomes.
During his speech, Senator Enyinnaya Abaribe (APGA, Abia South), Chairman of the Senate Committee on Power, expressed gratitude to the stakeholders for providing the Committee with clear information on the matter.
He emphasized that the investigation was still in progress.
