Markets

FG to Conclude Sale of Kaduna Disco, Afam Genco by March 2014

The federal government will conclude the bidding process for the privatisation of the Kaduna Electricity Distribution Company and the Afam Power Station by the first quarter of 2014.
The Chairman of the Presidential Task Force on Power (PTFP), Mr. Beks Dagogo-Jack, told THISDAY at the recent West African Power Industry Conference (WAPIC) in Lagos that the process was delayed due to corrections in the bidding process.
He said the Afam power plant and Kaduna Electricity Distribution Company had remained in government books owing to the bidding process corrections.
 
He however said the transactions were close to conclusion targeted before the end of the first quarter of 2014.
The Kaduna Disco and Afam Genco were not privatised along with the other assets of the Power Holding Company (PHCN) because no winners emerged with the required technical qualifications.
Following this development, the Bureau for Public Enterprises (BPE) opted for Plan B, where all the prequalified bidders were asked to re-submit their bids.
 
After the re-submission of the bids, the preferred bidders emerged with Northwest Power Consortium for Kaduna Disco and Taleveras Group for Afam Genco.
The Director General of BPE, Mr. Benjamin Dikki, told THISDAY that the privatisation agency was in the process of negotiating share purchase agreement with the bidders.
“Once we execute it, the bidders will now be obligated to pay 25per cent and the balance of 75per cent in six months, according to the transaction structure,” he said.
However, speaking on other outstanding milestones in the power reform, Dagogo-Jack, who represented the Minister of Power, Prof. Chinedu Nebo, at the WAPIC conference noted that the sale of the power stations built under the National Integrated Power Project (NIPP) was also on course.
 
“The bids for these plants have been submitted with the public bid opening held in Abuja on November 11, 2013.Transaction completion is scheduled for mid-2014. The proceeds of the transaction are to be re-invested in the power sector: in the transmission network and in small and medium hydro plants,” he said.
Dagogo-Jack further stated that given the formal and operational handover of the successor companies concluded, the electricity market had been designed to operate with a set of interim rules.
 
He said the interim rules were “aimed at furnishing the new owners and the industry at large with a market test-driving experience as well as an opportunity for the Industry operators to provide field data necessary for regulatory fine-tuning of the market rules and related tariff and revenue issues”.

Leave a Reply

Your email address will not be published. Required fields are marked *