Militancy: Transcorp Suspends N320bn Power Project over Gas Shortage
Transnational Corporation of Nigeria has suspended plans to build one of
the nation’s biggest power plants over gas shortage.
The company cited the poor economic situation in the country as reason for
its decision. Attacks on oil and gas installations in the country by Niger
Delta militants has also contributed significantly to the problem, making
it difficult to obtain fuel.
Transcorp in 2014, had said it would raise $1 billion to build a
1,000-megawatt gas-fired facility. Two years earlier, it bought the
Ughelli plant in the hydrocarbon-rich Delta State from the government and
more than doubled its output to 700 megawatts.
“How do you make the investments when you are generating far below your
current capacity due to gas problems. Transcorp whose interests range from
agriculture to energy, is owed over 20 billion naira (64 million dollars)
by state-owned Nigerian Bulk Electricity Trading Plc, for power generated
and not yet paid for.”the Chief Executive Officer, Transcorp , Emmanuel
The partial sale of 17 former state-owned power utilities three years ago
was meant to attract investment needed to expand the grid and end daily
blackouts. Yet, private investors have been hampered by increasing debts
owed by the government and the inability to obtain foreign exchange.
Electricity firms under the umbrella body Electricity Generation Companies
in Nigeria said last month they may be compelled to shut down because of
the gas and currency shortages.
The scarcity of gas has reduced Nigeria's power generation to less than
half of the installed capacity of 6,000 megawatts, the lowest in a decade,
even as the country holds the continent's largest reserves of the fuel.
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