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Nigeria: Obasanjo - I Spent $6.5bn On Power
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This Day (Lagos)
12 May 2008
Posted to the web 12 May 2008
Tunde Rahman
Lagos
Former president, Chief Olusegun Obasanjo, is opening up this morning on the amount spent on the power sector by his administration from 1999 to 2007.
In the text of his perspectives on the power sector, which THISDAY sourced last night Obasanjo will put the figure in the region of $6.5 billion.
This, according to him, will include outstanding letters of credit.
The House of Representa-tives Committee probing the contracts in the sector had summoned Obasanjo and his former deputy, Alhaji Atiku Abubakar, to appear before it this morning.
The former president will tell the committee there is enough on the ground to show for the expenses on the power sector.
Various sums of money ranging from $4 billion to $16 billion have been bandied around as the amount spent by the Obasanjo regime on the power sector.
According to the text of the presentation dated May 12, 2008, the former president argues that: "If you limit yourself to capital expenditure and running costs you will get a set of figures that can truly be said to be the real expenditure on power.
"I have been told that the figure in this regard from 1999 to 2007 is in the region of $6.5 billion including outstanding letters of credit."
He will, however, add that whatever "figure you choose to take, to say that there is little or nothing to show for it, is the greatest understatement of the year which will tend to portray inadequate knowledge or ignorance."
According to the former president, when his administration came in 1999, it met seven power stations - Kainji, Jebba, Shiroro, Egbin, Afam, Sapele and Delta - in different stages of disrepair and obsolescence and all of them generating about 1500MW.
By 2007, his regime had added six new stations with the seventh almost completed at Alaoji-545MW, he argues.
The six are as follows:
Okpai in Delta - 480MW by Agip; Afam II - 276MW; Omotosho - 330MW; Palalanto - 330MW; Geregu - 414MW and Ikot Abasi-Ibom Power - 145MW - to which Federal Government is a partner.
He said there were six National Independent Power Projects (NIPP) in the pipeline "and the expansion of Omotosho, Papalanto, Geregu and Alaoji to about 1000MW each by combined cycle and 2500MW from Mambilla."
"In other words, in eight years of our Administration, we have provided six new power generating units of almost 2000MW," he argues.
According to the text of the presentation, "There was no transmission work embarked upon between 1982 and 2000. But by May 2007, we have taken transmission to Bayelsa State for the first time, double the transmission from Shiroro to Abuja to ensure stability of supply."
The breakdown of what his administration met on the ground, according to him, is as follows:
-Non-serious investment in generation and transmission between 1981 and 1999, a period of eighteen years, except the completion of Jebba and Shiroro hydro power plants
-Although 6000 MW capacity was claimed in 1999, only 1500MW was being generated. Ijora and Oji River thermal based on coal have completely closed down for lack of coal production.
-The hydro power plants of Kanji, Jebba and Shiroro suffered seriously from silting and/or inadequate flow of water into the dam and poor maintenance.
-The Egbin thermal unit suffered from disruption of gas supply through vandalism and poor management and maintenance by NEPA staff.
-Because the transmission system was not a closed loop, any disruption by vandalism or any other cause meant power would totally be cut off from the part of the country affected.
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-NEPA was a den of monumental corruption and malpractice which were deep and widespread and revenue generation was grossly below expectation. There was massive illegal connection and avoidance of payment of bills.
Obasanjo will also admit to the committee that the situation was not thoroughly understood and identified by his administration until after the first two years of his first term.
"With such discovery, we sprang into action. First, NEPA leadership had to be changed and we brought in an accomplished Engineer from the private sector in person of Engr. Joe Makoju to assist with giving the organisation the leadership it lacked and to shape up the entire structure of the organisation and change their attitude and orientation.
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Now the real facts and figures are coming out. The actual amount including letters of credit IS $6.5b and the power increase during the periopd was 2000MW. One wonders what really was behind President Yar'Adua's $10b expenditure on power with no power increase to show for the amount spent by Obasanjo's administration. Could President Yar'Adua not have obtained this facts from records or could he not have discussed it with Obasanjo before making such a damaging and unbefitting statement? If anything has been learned from this power probe crisis it is the fact that THE LACK... [Read Full Text]
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