700 Mw Zungeru Hydro-Electric Project: Fg Signs $1.3 Billion Contract With Chinese Govt, Pays Counterpart Fund
On behalf of the Federal Government of Nigeria, the Coordinating Minister for the Economy and Minister of Finance Dr Ngozi Okonjo-Iweala, Saturday signed the contract for one of the country's legacy power projects, the Zungeru Hydro-Electric Power Project which will add 700 megawatts to the National Grid upon completion.
Chinese Ambassador Mr Deng Boqing signed on behalf of his country. Ambassador Godknows Igali, Permanent Secretary of the Power Ministry represented the Minister, Professor Chinedu Nebo.
The contract will be executed by a consortium of two Chinese companies China National Electric and Engineering Corporation (CNEEC) and SinoHydro.
It is captured in the 2012-2014 Medium Term Borrowing Plan approved by the National Assembly.
The total cost of the project is $1, 293,573,013.08. 75% of the cost will be financed by a loan provided by the China Eximbank while the Federal Government has already paid 25% of the cost in the form of a counterpart fund.
The loan is obtained at a highly favourable concessional terms: 2.5% interest rate with a seven year grace period and 20 years maturity.
Dr Okonjo-Iweala explained that the project will have significant positive impact in many areas stressing that 'it would create thousands of jobs for Nigerian engineers, technicians and artisans during the construction phase directly and indirectly. It would also boost the economy of the local economy in Zungeru as well as its environs'.
She stated that President Goodluck Jonathan had given all ministries and agencies involved in the project strict marching orders and that he expected it to be executed according to schedule.
'We are grateful to the Chinese Government for making this project a reality and we hope that the cordial relationship between Nigeria and China will continue to grow stronger for our mutual benefit'.