Stakeholders Blame Poor Gas Supply On Inactivity Of NIPP Plants

Major stakeholders in the country’s power sector have fingered the failure of the federal government to decisively tackle the lingering gas supply challenges for plants on the inability of power generation plants built under the National Integrated Power Project (NIPP) to fully come on stream.

They took on the government at the ongoing two-day power investment summit organised by the International Finance Corporation (IFC) in Abuja, arguing that the idle state of the over $5 billion (about N996.2 billion) NIPP plants should be blamed on government.

A one-time chairman of the Nigerian Electricity Regulatory Commission (NERC) and group managing director on Power, AITEO Group, Mr Owan Ransome, said, “Even with over $5 billion invested in the NIPPs they are down as gas is not there to power them.

“The projects cannot come to a financial close because there is not enough gas for the plants. The Nigerian Bulk Electricity Trading Plc (NBET) cannot sign their Power Purchase Agreements (PPAs) unless they answer these two questions: Do you have gas? Can you evacuate power? Unfortunately, the seller, which is the government, cannot answer these questions.”

Owan maintained that the federal government should take the risks for supplying gas to power companies because it is a major player with international oil companies (IOCs), and also owns the Nigerian gas pipeline and its associated infrastructure.

The former AITEO chairman, who recommended a single gas regulator for Nigeria, said, “To gasify our economy, we would need to have a sector regulator to set a foundation, and the rules and regulation for the market. This was done in the power sector.”

The president of the Nigerian Gas Association and chief executive officer of Oando Gas and Power, Mobolaji Osunsanya, said that it would appear as if the NIPP was designed by government to fail. He observed that “the NIPPs were designed to fail. Nobody builds that size and scale of power plants without being sure of dispatch and gas supply. The solution of gas supply risk will be a federal government-backed instrument but the gas transporter, the IOCs, and other parties must also give assurance of supply within their purview.”

On his part, the executive director of Falcon Petroleum, Audrey Joe-Ezigbo, noted that the possible solution to the challenges would be for the new government of President Muhammadu Buhari to look at the gas regulating agencies and collapse them for review.

“Gas is a critical resource in this country; it is the implication of power for any economy.