3 September 2012

Nigeria: Power Projects - FG Seeks Guarantee From China

Abuja — The Federal Government at the weekend asked China to attest to the competence and integrity of two Chinese firms contracted to execute two power projects in Nigeria.

The government said such a gesture would be necessary in view of the importance it attached to power projects such as the 3,500 megawatts Mambilla hydropower project and the 700mw Zungeru hydropower project being handled by two Chinese firms, SINO Hydro and China Gezhouba Group Company Ltd (CGGC).

Minister of State for Power, Mr. Darius Ishaku, at a meeting with the Chinese Ambassador to Nigeria, Mr. Beng Boqing, in Abuja, stated the concern of the Federal Government on the two companies handling the projects.

"The guarantee became important as a result of the importance the government places on the two dams in shoring up power supply. These two projects in particular are too large that no single company can execute each of them alone and deliver at a stipulated timeline, which is why we are worried," a statement from the ministry quoted the minister as saying.

The minister added that the government would subcontract some parts of the project to other contractors to quicken the realisation of the projects' objectives within the expected period.

According to him, the Federal Government is not comfortable with the companies and has reasons to doubt their ability to successfully handle the projects.

This, he said, had made the Federal Government to direct CGGC to pair with SINO Hydro to achieve the targets set for the various projects.

Ishaku, while responding to questions from Boqing, explained that Nigeria cancelled the agreement it entered into with CGGC when it became obvious that a single company could not execute the project alone and thus paired CGGC with SINO and other companies to speed up work on the Mambilla hydropower project.

Vice-President Namadi Sambo had in August chaired a meeting to finalise the formation of a consortium for Mambilla hydropower project.

The companies include SINO-Hydro and CGGC, while the consulting firms are being led by TRACTEBEL Engineering-Coyne-et Beller.

In response to the government's demand, Boqing, who vouched for the integrity of the companies, said they were as famous in China as they are in Nigeria in areas of hydropower technology.

He said: "The Chinese government appreciates the central role stability in electric power will portend for Nigeria in her quest to be a leading nation. Chinese hydropower companies, especially CGGC and SINO, are competent, popular and competitive in China and had played eminent roles in the industrial development of Nigeria."

Noting that it was wrong for Nigeria to disregard an agreement it signed without consulting its partners or other parties, he added: "An agreement is an agreement and the sanctity involved should be sacred."

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