4 February 2014

Nigeria: Zungeru Hydro - Construction At U.S.$1.8 Million Per Megawatt Is Cheap - Power Minister

Construction of the 700mw Zungeru hydro power project will cost about $1.85 million per installed megawatt, compared with the global average costs of between $1.05 million and $7.65 million per megawatt.

This was the view expressed yesterday in Abuja by the minister of power, Prof. Chinedu Nebo, while inaugurating a community relations committee for the project located in Zungeru, Niger State.

Giving the breakdown of the cost implication of the N162.9 billion project, Nebo said the $1.85 million benchmark per installed MW was within the investment cost for large hydro power projects as prescribed by the International Renewable Energy Agency (IRENA).

He noted that similar projects in other parts of the world averagely cost between $1.05m and $7.65m per installed megawatt.

While informing that government has secured a competitive financial cost for the project, Nebo said the expected diversion of the river in September this year has necessitated the swift attempt to resettle the communities that will be affected by the project.

The project, he said, is expected to meet up with its contractual commissioning timeline of 48 months following the completion of the topographic survey, exploration of construction materials, sub-surface investigations, among others.

The project which was awarded to CNEEC/Sinohydro Consortium in 2012 for $1.3billion was flagged off in May last year by President Goodluck Jonathan.

The Chinese Exim Bank is paying for 75 per cent of the cost while the federal government is providing the remaining 25 per cent as counterpart funding.

According to Nebo, the valuation report of affected persons and properties in the project site shows that about 22,100 persons, 15,958 farmlands and 6,762 properties within 98 communities would be impacted by the project.

Although he did not disclose how much the government has budgeted to resettle the communities which are scattered around three local government areas of Wushishi, Shiroro and Rafi, he noted that the resettlement committee has been instructed to coordinate timely compensation of the affected people.

"In arriving at the valuation figures, the estate surveyors have adopted the rates used by the Niger State Ministry of Lands and Housing as applicable to various types of building, structures, crops and economic trees," he said.

He added that the compensation for buildings and structures was based on the World Bank guideline on compensation for lost assets and replacement cost.

The minister further charged the committee chaired by Isa Jubrin to liaise with the three emirate councils where the affected communities are located to ensure quick compensations for the timely realisation of the projects.

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