10 November 2017

Nigeria: $350m Eurobond Allegation - I've Done Nothing Wrong, Says Fashola

Abuja — The Minister of Power, Works and Housing, Mr. Babatunde Fashola, on THurday night described as false claims by the Senate that his ministry had taken from the $350 million Eurobond fund of the Nigerian Bulk Electricity Trading Plc (NBET) that is deposited in the Nigeria Sovereign Investment Authority (NSIA) to fund its 240 megawatts (MW) Afam Fast Power project in Rivers State.

Fashola, also said in a statement he signed but was sent to THISDAY in Abuja by his senior Special Assistant on Communication, Mr. Hakeem Bello, that the Afam Fast Power project was an investment by United States firm, General Electric (GE) in Nigeria to support the federal government's plans for the power sector.

He noted in the statement that the investment by GE was however contingent on Nigeria paying $27.99 million which was 15 per cent of the cost of eight units of 30MW turbines each totaling 240MW and valued at about $186.6 million.

According to him, GE made the offer to Nigeria provided it was able to provide a site to host the mobile power system, as well as a guaranteed gas supply and power transmission route which Afam checked, hence, its hosting of the project.

Fashola, said the Senators did not consult his ministry for clarification of the development, adding that if they had, there wouldn't have been need for the claims he said they made against him, the ministry and its staff.

He said: "Before perception becomes reality, I feel compelled to make this statement in response to allegations bordering on financial impropriety raised on the floor of the Senate against the ministry of power, works and housing, my office as minister, the staff of the ministry and by extension my person.

"The sum and substance of the allegations to which the ministry will provide full, factual and detailed response when formally invited are that: An amount in the region of $350 million being part of a $1 billion Eurobond facility taken in 2013 has gone missing or has been diverted; 2. That the ministry, had procured a contract for Afam Fast Power and paid $26 million or thereabout for it."

On the fast power project, he said: "As for the Afam Fast Power, the sum and substance of it is that , it was an investment by the General Electric, a globally reputed Original Equipment Manufacturer (OEM), to invest in our country and support our effort to get good quick power under our roadmap of incremental, steady and uninterrupted power.

"They offered to do this by providing Nigeria with mobile turbines of 600MW if we could find a location with gas and transmission evacuation infrastructure. The Afam Power Station fitted because it had transmission and evacuation facilities but all its turbines had been virtually run down.

"The investment was contingent on paying $27,990,000 million which was 15% of 8 (eight) units of 30MW turbines each totaling 240MW valued at about $186,600,000:00. This payment of $27.9 million was made without breaching any law."

According to him: "At this moment, the turbines have arrived Nigeria and currently at the Onne Port. This is verifiable just as works are on going on the site - civil and engineering - preparing to receive the turbines , and install other equipment already at site.

"All of these are verifiable by all well meaning Nigerians who may want to undertake the inspection. We expect that the project will be commissioned soon enough to add 240MW to the grid."

He further noted that: "This will be one of the fastest power projects when delivered, compared to inherited power projects before this Administration."

Chiding the senators further, the minister stated: "Investors to the best of my knowledge do not require parliamentary approval to invest in our country. All of these facts could have been easily verifiable by a simple letter from the Senator to the ministry without the furore and suggestions of wrong doing and malfeasance."

He said: "We must be careful about what we say and do with regards to investments and investors which we clearly need in all sectors of our developmental life and in particular in infrastructure and power.

"Unverified allegations such as the ones under discussion constitute an imminent threat to our investment climate. For the avoidance of doubt, there has been no wrong doing whatsoever."

Nigeria

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