Federal Government Through the Bureau of Public Enterprises Plans to Sell Five Plants for $1 Billion
- Posted on January 24, 2024
- Featured
- By PETER AGADA
On Tuesday, it was announced that the Federal Government, in collaboration with the Bureau of Public Enterprises, plans to sell over five (5) power plants under the National Integrated Power Projects for $1.15 billion.
However, some sources have revealed that the sale of the plants should exceed $5 billion based on international benchmarks; they said that the BPE was planning to sell the facilities at a price that is a little above $1.1 billion.
The PUCNH revealed that it got into talks with Ignatius Ayewoh, the acting Director-General of BPE, on a phone conversation, and he said that the transaction is currently ongoing, as he also stated that the transaction is not settled yet.
Ayewoh did not disclose the amount for the five plants, as he told PUNCH that he was in a meeting and could not give additional details.
However, some sources at the commission gave out five power plants that are expected to be on this list, including:
The 434-megawatt gas-fired Geregu II power plant is located in Kogi
451 MW Omotosho II plant in Ondo
The 750 MW Olorunshogo II plant is in Ogun State
563MW Odukpami power plant in Calabar, Cross River State
451MW Benin-Ihovbor plant in Edo State
It was gathered that the Omotosho plant, which has four power-generating turbines, would be sold for about $85 million, while the Olorunsogo NIPP, which also has four turbines, would cost $170 million.
The Benin-Ihovbor plant with five power-generating turbines would go for $420 million; the Calabar Odukpami plant with five turbines would be sold for about $260 million; and the Geregu plant with four turbines would go for $215 million.
“These are Siemens turbines, and each of the turbines can generate about 115 MW of electricity,” stated one of the sources, who pleaded not to be named due to a lack of authorisation.
The official explained that it would cost about $1 million to construct a plant that could generate 1 MW of electricity, stressing that if the five NIPP plants were valued on this basis, they would cost more than $5 billion.
It was, however, gathered that the cost of constructing a 1MW power plant varies depending on several factors, including the type of power plant, location, technological advancements, etc.
“But a general range for the cost of constructing a 1 MW power plant based on different technologies is that for a solar power plant, it is between $1 million and $2 million per MW.
“For wind power plants, it is between $1.5 million and $2.5 million per MW. For natural gas-fired power plants, such as the NIPPs, it is between $1 million and $2 million per MW, while for coal power plants, it is between $2 million and $3 million per MW,” another source in the sector explained.
Frequently Asked Questions (FAQs)
What is the Bureau of Public Enterprises?
The Bureau of Public Enterprises (BPE) is a government agency in Nigeria responsible for implementing policies on privatisation and commercialisation.
What does the Bureau of Public Enterprises do?
The Bureau of Public Enterprises (BPE) is charged with driving the Federal Government's programme of privatising public enterprises, carrying out sector reforms and liberalising key economic sectors, especially the infrastructure sector.
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