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$1bn 450MW plant's construction begins in June

By The Citizen
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The construction of the 450 Megawatts Azura-Edo Independent Power Plant will commence on June 30, 2014, the Co-founder and Joint Managing Director Azura Power Holdings, Dr. David Ladipo, has said.

Seplat's Oben Gas Plant will supply the IPP with the project's fuel gas requirements. This, the firm added, falls within the company's medium to long term goals.

Ladipo, who disclosed this after a signing summit organised by the firm in Abuja, stated that all was set for the take-off of the project.

He said, 'Our target is to start construction this summer. So we have a target to proceed on actual construction on the 30th of June. However, we might have a list of condition precedents to be satisfied before then.'

He said the firm had signed the key industrial contracts and confirmed the debt financing of its flagship power plant to be constructed in Edo State.

Ladipo noted that the plant, a $750m transaction, is the first of a new wave of project-financed greenfield IPPs.

He said, 'The financing of the Azura-Edo IPP involves $220m of equity and $530m of debt from a consortium of local and international financiers.'

The event also showcased the $300m investment being made by Seplat in new gas processing facilities at its Oben Gas Plant, which, as part of Seplat's joint venture with the Nigerian Petroleum Development Company, would supply the Azura-Edo IPP with the project's fuel gas requirements.

'In total, the investments by Azura and Seplat constitute over a $1bn of local and international financing into the Nigerian gas and power sector,' Ladipo said.

Earlier at the conference, the firm signed various agreements with its commercial and government counterparts, lead debt arrangers and regulators.

Some of the firms at the signing summit include Seplat Petroleum Development Company Plc, Siemens Nigeria Limited, the Nigerian Electricity Regulatory Commission and the Nigerian Bulk Electricity Trading Plc.

Seplat, on its own, spoke on the signing of a major $300m gas sale and supply contract which will leverage on the NPDC/Seplat JV's investment in the gas domestication business and ultimately boost electricity supply in the country.

Chief Executive Officer, Seplat, Austin Avuru, said, 'The domestic gas space is a huge opportunity for Seplat. The privatisation of the domestic power industry, coupled with a massive government initiative to promote the use of natural gas, has driven investment in gas infrastructure development and power generation.'

Avuru reaffirms that a'15-year gas supply contract for power plants will underpin the expansion of Seplat's domestic gas business.'

He added, 'This will also promote the company's organic growth, which is to continue to apply the best technology and human capital that SEPLAT has to drive production and reserves growth in current assets and vigorous growth of our gas domestication business.' Punch