The Federal Government has earmarked $8 billion (N1.3 trillion) for the execution of the Nigerian Gas Master Plan with specific interest in meeting the gas-to-power demand in the country.
Vice President Namadi Sambo stated this in Abuja on Friday at a forum on investment in the power sector.
He said the programme would be jointly implemented by Nigerian National Petroleum Corporation (NNPC), Nigeria Gas Commission (NGC) and the private sector.
According to him, already $500 million (N80 billion) of the $1 billion dollars realised from Euro-Bond would be utilized as counterpart funding for implementation of the project.
He said government had also embarked on an extensive programme for the upgrading of the nation's power transmission capacity.
"We are also implementing an extensive programme for the upgrading and expansion of our power transmission capacity. We plan that before the end of 2014, we can transmit up to 10,000mw and by 2016 to transmit up to 20,000mw," Mr. Sambo said.
He said the total funding for the project is estimated by the Transmission Company of Nigeria (TCN) to cost about $3.7 billion.
"I am pleased to inform you that funding for these projects has already been arranged.
"$1.6 billion is coming from the sale proceeds of the NIPP/NDPHC ten new power plants, $500 million from the China-EXIM bank and the balance from the African Development Bank (AfDB), Islamic Development Bank and (from you) our local banks," he said.
Mr. Sambo announced that the PHCN asset would be handed over to private sector operators on September 30. He reassured that government would continue to improve the efficiency and affordability of power supply in the country.
"The Federal Government shall, in tandem with the goals and objectives of the National Electric Power Policy (NEPP), continue to, among others, improve the efficiency and affordability of power supply.
"I will like to share with that we are investing in improving their mix generation capacity of this country by the construction of the Zungeru hydro-power which would add 700megawatts at the cost of 1.2billion dollars, work is already on this project.
"The construction of the Mambila Hydro power plant which would add 3050megawatts and we are utilizing N1.7billion from the sale proceeds of the NIPP Power plant as counterpart funding for this project that will cost 6.4billion dollars," he said.
Mr. Sambo commended the private sector and the banking industry for supporting government's efforts to improve the power situation in the country through their positive response to financing the Independent power projects.
He particularly commended the Central Bank of Nigeria (CBN) for kick-starting the privatization process through its N300 billion intervention fund for the power and aviation sectors of the economy.
"Let me also congratulate the banking industry for its contribution so far to put our great country on the path of growth to attain our aspiration to be among the top twenty economies in the world through reliable, affordable and adequate power supply."
According to Mr. Sambo, in the coming years, more demand would be placed on the banking sector to support power infrastructure renewal and the industrial development to support the power sector.
In his remark, the Governor of the CBN, Lamido Sanusi, said the forum was to review the contributions of the banking industry to the power sector reform programme.
According to him, the CBN in collaboration with the Ministry of Finance is reviewing the Development Finance Institutions to facilitate the financing of critical development projects.