‘N3.7bn power transmission mgt deal under threat’

By LOUIS IBA

Nigeria’s power sector reforms programme appear to be heading towards the rocks, at least in the transmission industry, as Daily Sun learnt that the recently signed $23 million (about N3.7 billion) management contract with Manitobi Electric had been stalled due to an internal crisis between officials of the Power Ministry and the Canadian firm.

A top official in the Power Ministry told Daily Sun that at the root of the crisis was the ‘absence of the zeal’ to execute the terms of the contract signed between the Federal Government and Manitobi. “Manitobi officials have been barred – or frustrated – from taking control of the management of the Transmission Company of the Nigeria (TCN) almost two months after the government had ceded the contact to the firm,” said the source. “And the truth is that there is the absence of the zeal by the government to execute the deal,” the official added. Worried by the rot in the power sector, the government had privatized the generation and distribution aspects of the business, but had rather opted to concession the transmission business, under a three year tenure deal to Manitobi, to turn TCN into a technically and financially efficient, stable and sustainable company.

It was learnt that Manitobi has been denied the right to appoint or fill all senior or top management position in TCN as stipulated by the terms of the deal, which designated Nigerians as second in command in all key positions in the company. “The contract to manage the strategic positions in TCN by Manitobi has not been effected as the Nigerians occupying those positions have refused to yield ground,” said an industry source. “And there is nobody to compel or force them out for the new management firm to come in.”

Sources said trouble started following the untimely exit of former Power Minister, Prof. Barth Nnaji who mid-wived the deal with Manitobi, a development that threw up the Minister of State, Darius Ishaku as the new helmsman. And it is alleged that IShaku and the new team in the Power Ministry had a different vision from what the erstwhile minister, Nnaji had. “When Nnaji left, the people that took over had a different idea; they saw the Manitobi deal from a point of view that necessitated a review and most senior officials in the ministry wanted to re-write the rules,” said a source about the deal.

“But the Manitobi establishment would take none of that and that is where the deal got stuck,” the sources said. But the stalemate is not without grave implications to the Nigerian economy as the N3.7billion sum paid to the Canadian firm had already become operational as from September 1, 2012. “The money is running at a loss to the country,” said an official of the BPE, who volunteered to explain the implication to the economy.

“I think it is a situation where a force majour would have to be invoked to save the loss,” he added. Current generation capability in Nigeria stands at about 5,000megawatts and existing transmission facilities are so obsolete to carry even that capacity effectively. And with a fresh target of 10,000megawatts by 2015, the need to pump in fresh investments into the transmission network cannot be overstated. bureaucratic deepening amid efforts by the Federal Government government to free up the sector and allow private sector