By Egena Sunday Ode
Vice President Yemi Osinbajo and Chairman of the National Council on Privatization (NCP) Monday, extolled Transcorp Power Ltd for being delisted from the routine evaluation and monitoring of the BPE.
The routine evaluation and monitoring is an important feature of the post-acquisition plan by the BPE and it has covenants and deliverables which the enterprise is supposed to live up to Transcorp Power PLC has been able to ensure compliance with all of the deliverables and in some cases even exceeding the covenanted deliverables in the PAP, the Vice President said.
Osinbajo said that the presentation of the delisting certificate to the owner of Ugheli Power Plant, Transcorp Ltd was commendable.
Speaking at the presentation of the Delisting Certificate from BPE routine monitoring and evaluation in his office at the Presidential Villa, Abuja, Osinbajo commended the management of Transcrop Power PLC, led by Tony Elumelu and members of the Transcrop power team.
He also to commended the BPE for doing an excellent job of monitoring and being able to come up with an objective not just a set of criteria, but also an objective means of deciding that “we’re able today to delist the Transcrop Power Plc.”
“We’ve also heard today that the Transcrop Power can deliver efficiently and it can do so even way beyond the expectations of the PAP,” the Vice President said.
He urged the organization to continue on that path and to do even better.
The power needs of our country are grave. And we strongly believe that the right approach is the privatization of the power sector to enable serious-minded private sector players to invest in the provision of public power and ensure that they are efficient while they make a profit at the same time.
We hope that this will not be the last in the series of private power companies that are taking over power plants that are unable to meet the expectations of the post-evaluation plans.
Earlier speaking, the Director General of the Bureau of Public Enterprise (BOE) Alex Okoh explained that the philosophy around the privatization of state-owned enterprises “Is a consequence of the global paradigm shift” from public ownership and management of public utilities to allow the private sector play a more dominant role in leveraging its financial and management capacities.
He said that Ughelli Power PLC is a gas-fired thermal plant located in Delta State, commissioned in 1966 with an installed capacity then of 900 megawatts, but the available capacity at the point of privatization was 300 megawatts.
The plant, the BPE’s boss said, was one of the six gencos privatized by the Bureau on behalf of the federal government.
The Director General of BPE, Alex Okoh, explained that “As part of the 2013 privatization exercise, Ughelli Power PLC executed the performance agreement on August 21, 2013, with the BPE. In the agreement, the company committed to achieving specific improvement targets over a five-year lock-in period.
According to Okoh, the improvement targets covered five key areas and these are available capacity, capital expenditure, human resources, health, safety and environment, and corporate social responsibility.
The Director General explained that, in pursuit of the objective of the federal government’s privatization program, and to ensure effective and efficient management of the privatized high utilities in the generation segment of the value chain, the BPE implemented a five-year monitoring exercise designed to determine the level of performance of the respective core investors and to assess their levels of compliance with the operational thresholds and covenants enshrined in the performance agreement.
“It is pertinent to know that arising from the mandatory monitoring exercise conducted by the BPE and in the exercise of the powers vested on it, the Bureau is authorized to initiate a discharge from the monitoring regime should the enterprise be adjudged to have met the terms of the performance agreement. An enterprise may also formally request for its delisting once the key performance benchmarks have been met.
“Following a capacity determination and validation of Ughelli Power PLC by the consultants engaged by the National Council on Privatization it was determined that generation capacity had increased by about 227 percent from the operational status of 300 megawatts at the point of handover in 2013,” he stated.
The company, he said, has achieved an available capacity of 680.8 megawatts, which surpasses the minimum performance target of 670 megawatts.
He added that capital expenditure totaling N58.6bn was the covenant established or phases one and two of the post-acquisition plan, while actual investments made by the current investor were in the sum of N83.85bn; all the agreed benchmarks on the human resources, health, safety and environment, and corporate social responsibility have also been achieved.
Having exceeded the minimum performance targets and having fulfilled all the agreed obligations, the National Council on Privatization at its meeting on April 4, 2023, considered and approved the recommendations of the Bureau and its requests that the company, Ughelli Power PLC be approved for delisting from routine monitoring, BPE’s DG said.
The bureau, on behalf of the National Council on Privatization, congratulated the board and management of Transcorp Power for the milestones achieved in turning around the operations of the power generation enterprise while looking forward to a sustained collaboration in improving the outcomes in the power sector.
Tony Elumelu, Chairman of Transcorp Power Ltd, thanked the Vice President and the federal government for their confidence and trust in them, assuring that they will not disappoint the Nigerian people and the federal government.
Elumelu said that Transcorpe Group recognized the importance of improved access to electricity, adding that with improved access to electricity, people can go to school, hospitals can function well, businesses can operate very well, and can empower the industrialization of the economy.
This is why we invested in power and why we continue to invest in the power sector because we know it holds the key largely to the success of our country.
“Mr. Vice President, let me also say that in addition to the criteria set, we are doing a very strong Indigenization of Transcorp Power Plc. I’m proud to say that our power plant is managed and operated 100 percent by Nigerians.
“I am also proud to say that safety standards, are extremely high, we have operated since 2013 with no incident and we hope and pray that it will be sustained because we know the importance of safety and sustainability in today’s world.
“We have not grown alone, we have grown together with our community; we have functional hospitals, schools – primary and secondary schools and we do engage a lot with the community and have helped to create jobs for our people.
“So, we are happy to be on this journey with the federal government and we want to do more in this sector. “
