6000MW Electricity Not Feasible By December

The Federal Government has reneged on earlier promises of generating 6,000 Mega Watts (MW) of electricity by December 2014, announcing Saturday, a new target of 5,000 MW by year-end.

The Central Bank of Nigeria (CBN) is also set to clear up the N25 billion gas related debts of the power sector in order to boost stakeholders’ confidence in the industry.

The Minister of Petroleum Resources, Diezani Alison-Madueke, made these disclosures at the headquarters of the Nigerian National Petroleum Corporation (NNPC) during a press conference on gas that was jointly held by the petroleum ministry, ministry of power, CBN and the Nigerian Electricity Regulatory Commission (NERC).

Alison-Madueke said about 750 million cubic feet per day of gas was currently supplied to the power sector, resulting in an aggregate generating capacity of about 4,000MW.

“It is expected that barring unforeseen developments, our interventions will add at least 370 million cubic feet per day of gas and assure a generation capacity of at least 5,000MW within four to five months,” she said.

Alison-Madueke further stressed that the various outages often reduced the actual availability of power and noted that if there had been sufficient gas supply, current generation capacity would have exceeded the 6,000MW mark.

To give confidence to stakeholders in the gas sector regarding the willingness of power firms to settle their outstanding debts for gas, Alison-Madueke said CBN would support initiatives to clear up the most recent gas related debts of the power sector, stressing further that the nation’s Apex babk was looking at banking sector led measures to pay off N25 billion of debts owed to gas suppliers.

This will be subject to reconciliation efforts and adequate provision for this support in a revised Multi Year Tariff Order that ensures repayment within five years.

CBN will also play a key role in financial arrangements that guarantee payment for gas supply by the power sector, even as the Nigerian Electricity Regulatory Commission  would require firm commitments from gas suppliers that they will supply the agreed quantities of gas to generation companies in the country.

Source: Business Day
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