Proshare Logo
   Market Date: 23-01-2015   
Agriculture ARTS FINANCE All One Min News Archives Bonds Cap Mkt Sentiments Capital Market CASHLESS NIGERIA Commodities Corporate Earnings Daily & Weekly Market Updates Elections Enterpreneurship ETFs Forex Frauds & Scandals General Global Market Insurance Investors NewsBeat Islamic Finance Mergers & Aquisitions Money Market Mortgage Mutual Funds Nigeria Economy Oil Sector Opinions and Analysis Pensions People Personal Finance Politics Power Products & Services Professionals Property Public Offers Private Placements Regulators REITs Stock PICKS Taxation Telcos Travel & Tours Unlisted OTC MARKET World of Business

Nigeria to privatise power generation

Category: Power

  Read (2364)
Nigeria to privatise power generation

By Tom Burgis in Lagos, August 26 2010 16:11

Nigeria’s president on Thursday invited foreign investors to join what could be one of Africa’s biggest privatisations as the country seeks to sell its power generation and distribution companies.Goodluck Jonathan called time on the state-owned power company, which has given Nigeria one of the lowest per capita supplies of electricity in the world.

The privatisation is aimed at spurring the $10bn of investment needed to revive the country’s power system. Mr Jonathan’s decision represented a victory for reform-minded officials tussling with vested interests who profit from widespread corruption within the electricity system.The president said: “The private sector will be responsible for generation and distribution companies, while the government will continue to own the transmission system but under private sector management.”

Potential investors from Canada, Turkey, Saudi Arabia, India and China were eyeing the privatisation, according to investors, financiers and officials.Luminaries of Nigerian business – who unanimously declare the power crisis the biggest obstacle to realising the country’s economic potential – rose to applaud the president’s announcement in Lagos, the country’s commercial capital.

But many have heard promises of reform before, only to see them dashed. Nigeria is sub-Saharan Africa’s biggest oil and gas exporter but most of its 150m people enjoy only a few hours of electricity a day at best.Private generators have become the main source of power in the absence of a functioning national grid – and running them costs Nigerians an estimated $13bn a year.

Advocates of the reform plan conceded that there were still battles fought. Workers at the state-owned Power Holding Company of Nigeria, many of whom would probably be made redundant under the reforms, staged a one-day strike to protest against the plan on Wednesday.With elections looming next year, Mr Jonathan declined to put a number on a proposed rise in regulated tariffs charged to electricity consumers. Officials estimated that the tariff would have to treble to make investment in distribution companies and power stations commercially viable. Mr Jonathan said only that the new prices would “give incentives to investors”.

The president has not publicly declared whether he will stand in the forthcoming election but is widely expected to do so.Oil groups such as Royal Dutch Shell have been reluctant to sell gas in large quantities to Nigerian power stations. The price on offer is far lower than the revenues available from exporting gas.

However, Diezani Allison-Madueke, oil minister, said the electricity reforms could allow the gas price paid to energy groups to increase dramatically by 2013.

Tom Burgis

West Africa correspondent

Financial Times

Mobile: +234 (0)808 505 6329

Tags: , 

Comment With Your Facebook or Yahoo! ID

Latest news

News on Power

About Us

Who We Are
Our Team & Partners
Corporate Governance
Advertise with Us
Subscribe / Unsubscribe
Site Map
News Feed - RSS
Contact Us
Volunteer Program
Message from CEO

News & Features
The Analyst / Market Data
Investor Relations Portal
The Regulator
Economy & Politics
Training Portal
Events Calendar
NewsStands - Online Reputation

Products and Services

Research & Market Intelligence
Analyst Services
Offers & Rights Support Service
Investor Relations Services
Alert & Subscription Services
Share Support Services
Proshare Consult
Event & Seminar Coverage
Market Directory
File a Complaint
News & Analysis

News from TheANALYST
Video News from WebTV
Money Market Updates
Opinions & Analysis
Nigerian Economy
Market Data
The Regulator
Discussion Forum

Subscriber Agreement
Privacy Policy
Data Policy
Copyright Policy
Comments in Site
Advertising Code
Conflict of Interest
Content Partnership
3rd Parties

Online Trading and Execution
Legal Support Services
Web/Technology Services
File a Complaint

CBN Governor 2014