The Federal Government on Wednesday signed a Memorandum of Understanding (MoU) with two Chinese firms, SINO Hydro and Gezhouba Group Company Ltd (CGGC), to build two hydro-power stations in the country.
The Minister of State for Power, Mrs Zainab Kuchi, said at the signing ceremony in Abuja that the companies would build a 3,050MW station in Mambilla, Taraba, and a 700MW station in Zungeru, Niger.
Kuchi said the agreement would boost power generation in the country.
He said that the Mambilla project was planned since 1985 to produce 2600MW but the contract was reviewed for the plant to produce 3,050MW .
He said the project had been planned to be implemented within five years.
She noted that 85 per cent of the cost of the Mambilla project would come from Exim Bank of China, while the Federal Government and other private equity funds would provide 15 per cent of the cost.
The minister said that the Mambilla project would cost 3.2 billion dollars.
She said while the Federal Government had made available N87.6 billion for the project, N1.6 billion had been spent.
She described the projects as huge and as such the two Chinese firms were engaged to execute them on schedule.
The minister said that the Zungeru Hydro project was initially a 950MW capacity plant with 60 months completion period but was halted due to the lack of funds.
She said that in 2008, the Zungeru project was reviewed downward by the Federal Government from 950MW to 700MW, consisting of four units of 175MW capacity each.
According to her, the Zungeru project would provide 944.3 billion dollars through the Exim Bank of China, while Nigeria would provide N440 billion.
She said the financing structure was on long term export credit loan from Exim Bank of China, while Nigeria would source for N87.7 billion to be disbursed to the ministry under the Power Sector intervention Fund.
Earlier, Mr Reno Adesoya, the Chairman of Sunrise Ltd, one of the partners in the projects, who spoke on behalf of the Chinese companies, gave an assurance that they would deliver the projects on schedule.
He called on the government to provide them an enabling environment to succeed.