allAfrica.com: Nigeria: Power Probe - Contractor Faults FG (Page 1 of 2)

ONE of the contracting firms handling four of the National Integrated Power Projects (NIPP) now being probed by the House of Representatives Committee on Power says the Federal Government is actually owing it N12 billion for work done.

Rockson Engineering said, weekend, that the four ongoing contracts being handled by it were still within the contractual time-frame.

Managing Director of the company, Sir Arumeni-Johnson, told reporters that of the amount expended by his company so far, records showed that government was owing it N12 billion.

"We even advanced government money to pay compensation to land owners at Alaoji and we have not been refunded," he said, adding that payments by government for the power projects were based on achievement of specific milestones.

He said the projects were being slowed down by administrative bottlenecks caused by the Power Holding Company of Nigeria, the Ministry of Energy (Power), Niger Delta Power Holding Company, the Central Bank and the Ministry of Transportation.

The four projects being executed by it are: the 1,074 Mw Alaoji Power Station; the 338Mw Egbema Power Station, the 225Mw Gbarain/Ubie Power Station; and the 256 Omoku Power Station at a total cost of $1.2 billion (about N140.4 billion).

He put the cost of the Alaoji Phase 1 Power station (including three gas turbines) at $164.5 million and said his company had only received 75 per cent based on work done. It has also received 80 per cent of the $95.3 million in respect of the Alaoji addendum 1 for the 4th gas turbine and the accompanying civil works for phase two.

Work at Alaoji has since been improved upon for a combined cycle (addendum 2) at a cost of $357 million but no letter of credit has been established, neither has any payment been made by government.

Similarly, government has issued change orders for the relocation of the Alaoji site owing to space constraint, among other considerations, at a cost of $123.3 million. Although the firm says it has accomplished the change, payment or letter of credit has not been made.

For the Gbarain/Ubie (two gas turbines) Lot 4 valued at $138 million, the Egbema (three gas turbines) Lot 2 valued at $128 million, the company said it had been advanced 25 per cent based on work done, while no payment has been received for the 200-kilometre Transmission - Lot 6 valued at $107 million.

Sir Arumeni-Johnson also said although government made 16 per cent of the Omoku Power station valued at $161 million available based on work done, this was in breach of the contract because the contractual terms stipulated a 25 per cent payment. He said the company had not drawn on the money advanced.

He said over 125 containers of power plant equipment for Alaoji Thermal plant in Abia State, Egbema thermal power plant, Gbarain/Ubie and Omoku power station were still lying uncleared at the Onne Ports owing to bureaucratic bottlenecks. The gas and steam turbines for the Alaoji power station are similarly stacked at Onne Ports due to government failing.

Government is expected to upgrade the Imo River bridge before the equipment weighing over 260 tones can be transported to site and installed.

Sir Arumeni-Johnson said demurrage was accumulating on imported equipment lying at Onne Ports and that at the last count it was in excess of 600,000 Euros.

Also speaking, Senator Aniete Okon, Chairman of the company, said warranty on the equipment supplied by General Electric (GE) would run out in a few weeks, and that the equipment had been lying at the ports since the last quarter of 2007.

He said all attempts to get the Ministry of Energy (Power) and PHCN to facilitate the process of clearing the equipment even with the intervention of the House of Representatives Committee on Power and Steel in December last year with the Minister of State (Energy) responsible for Power, Hajia Fatima Balarabe-Ibrahim, failed to produce the desired result.

Also speaking with newsmen at the site of one of the projects in Alaoji, Mr. Graham Jubb, Site Manager of the consultants (PB/JE) hired by government said without gas and steam turbines coming out of the port there was nothing the contractor could do.

He added that if the equipment were moved to site this month, in another nine months the Alaoji power plant would supply power to the national grid.

"It is frustrating that we can't install the gas turbines and the steam turbines because they are held up at Onne Ports. I think the contractor has done well considering the amount of work so far completed on site," Jubb said.

He also described the work being carried out at the Alaoji Power station as first class and comparable to anyone anywhere in the world.

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