NNPC, Partners in 50MW Maiduguri Power Project: Re-Assess Viability in the Face of Insecurity, analysts counsel

What has changed to warrant confidence in the security of this venture? Has Nigeria eclipsed the Boko Haram terrorists? What will stop the insurgents from blowing up the plant after it has been commissioned?

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Gas Power Plant

The Nigerian National Petroleum Corporation (NNPC) has signed a contract with its partners for a 50 megawatts (MW) emergency power project for Maiduguri town in Borno State, according to a report by Daily Trust newspaper.

Maiduguri was cut off from the national grid in January 2021, after insurgents cut down transmission towers delivering bulk power. It was restored in February but another section was vandalized days after.

The Nigerian National Petroleum Corporation (NNPC) has come to Maiduguri’s rescue, having signed the Engineering, Procurement and Construction (EPC) contract with China Machinery Engineering Company (CMEC), EPC contractor, General Electric (GE) and Original Equipment Manufacturer (OEM) to provide a 50MW power plant to service the town.

At an average consumption of10KVA per average household, the NNPC rescue plan will supply electricity to about 5000 households in Maiduguri and its environs.

At the virtual contract signing, the Group Managing Director of NNPC, Mallam Mele Kyari, said NNPC was doing this through NNPC Gas and Power Investment Company (NGPIC), its subsidiary.

He also said the plant will be fueled by Liquefied Natural Gas (LNG) and operate on commercial terms.

Mele noted that NNPC was raising investment in gas-fired combined cycle power plants to produce at least 5,000MW in Nigeria.

He said the single cycle will be delivered by December while the combined cycle will be ready in the first quarter of 2021.

Vice President of GE Africa & Europe, Mr. Raisin Brice, said the company was committed to working with NNPC to achieve success in the project.

The gas plant is sited in the Gajigana area, where NNPC had conducted extensive hydrocarbon exploration in the 80s.  Evidently, commercial gas reserves are fond in the underbelly of the area.

Gajigana is some 47km away from Maiduguri, along the Baga Road and leading to the Lake Chad road. In 2019, the Islamic State had sacked a military base in Gajigana.

However, analysts have expressed reservations on the wisdom in this investment, considering that insurgency remains active in the state.

What has changed to warrant confidence in the security of this venture? Has Nigeria eclipsed the Boko Haram terrorists? What will stop the insurgents from blowing up the plant after it has been commissioned?

Where will the gas come from, and at what cost to the operators? Who will pay commercial value in Maiduguri for the electricity generated, at probably security-inflated costs, as to guarantee good return on investment?

These questions and many more shroud the viability of the Gas-to-Power project.

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