Investors urge FG to sell its shares in power firms

By Simon Ugwu

Power distribution companies have called on the Federal Government to sell part of its 40 per cent stake in the various Discos in order to help raise the needed liquidity in the sector.

This was in a reply to comments made by the Minister of Power, Works and Housing, Babatunde Fashola, investors in the Discos stated that they entered into an agreement at the point of sale of the companies not to sell more than five per cent of their shares for a period of five years.
The minister noted recently that there was financing challenge in the sector where distributors who own 60 per cent of the undertaking need to raise capital to buy and supply meters, as well as replace aging assets.
“The opportunities that I see for investors are enormous. Why can Discos, for example, not divest some of their shares in order to raise funds to finance the business?” he said.
But in response to the minister’s comments, the Executive Director, Association of Nigerian Electricity Distributors, an umbrella body for the Discos, Mr. Sunday Oduntan, who spoke on behalf of the investors, argued that the government also had shares in the power firms and should consider divesting some its equity in the firms based on the legal constraint facing those who invested in the companies.
“The investors point out that the agreement at the point of sale does not allow them to sell more than five per cent of their shares in five years. So even if they wish to, there are legal constraints that they cannot circumvent,” he said.
“Since government owns 40 per cent of the shares, government could consider divesting part of its own to help raise the needed liquidity in the sector.”
On issues pertaining to the metering of power consumers, Oduntan said, “The Discos are the most willing party to meter customers so they can cut down the cost they bear on energy theft. They are planning to do customer enumeration to determine their customer strength but they need fund to do that. A Disco said to do such enumeration in just one state, it was given a bill of N2bn.”

NNPC Says No Plans to Increase Petrol Price, Warns against Hoarding, Panic Buying

Nigerian National Petroleum Corporation, NNPC says that the recent increase in bridging allowance to transporters from N6.20 to N7.20 per litre will not lead to an increase in the pump price of Premium Motor Spirit, PMS, also known as petrol from the prevailing price of N145 per litre.
Providing the clarification in Abuja on Wednesday, the Chief Operating Officer, COO, in charge of Downstream operations of the Corporation, Mr. Henry Ikem Obih, said there was no plan by government or any of its agencies to review the pump price of petrol above N145 per litre.
He explained that the rise in the bridging cost was achieved after an adjustment was made in the “lightering expenses” from N4 to N3 per litre and the difference transferred to compensate for the cost of bridging within the same template.
The bridging allowance refers to the cost element built into the products pricing template to ensure a uniform price of petrol across the country, while lightering expenses involve charges for moving products to depot area from mother vessels by light vessels due to the inability of the former to berth in shallow water depth.
“What happened, in simple language, is a rebalancing of the margins allowed and approved for stakeholders. So what the Petroleum Products Pricing Regulatory Agency, PPPRA, did was to take N1 from lightering expenses and add same to the bridging allowance. That is how we arrived at N7.20. Therefore, PMS remains at the ceiling of N145 per litre,’’ he said.
On the availability of product supply, the COO said as at today, the country had 1.3billion litres of petrol which translated to an inventory of 36 days.
“What this means is that even if we stop importation or refining of petrol right now, we have enough products in-country to provide for the needs of every Nigerian for a period of 36 days,’’ he said.
Obih noted that the supply availability was bolstered with the production of petrol from the three refineries located in Port Harcourt, Warri and Kaduna.
“There is absolutely no risk of shortage in supply as we also continue to import to support the production from the refineries, we have informed the Department of Petroleum Resources, DPR, to enforce the prevailing N145 per litre price regime and also ensure that every service station that has fuel is selling to the public,’’ he added.
The COO reiterated the readiness of the NNPC Management under the leadership of Dr Maikanti Baru to sustain the existing cordial relations between the NNPC and the leadership of the downstream industry unions and other stakeholders.
He said the DPR which is the regulatory arm of the industry had been alerted to sanction fuel station owners who engage in hoarding or charge consumers in excess of the approved pump price of petrol.
NNPC GMD, Dr Maikanti Baru had announced the review of the bridging allowance on Monday at a mediation meeting between the Petroleum Tanker Drivers, PTD, and the Nigerian Association of Road Transport Owners, NARTO, leading to suspension of a strike action embarked upon by members of National Union of Petroleum and Natural Gas Workers.
In attendance at the resolution meeting were the NUPENG National President, Comrade Igwe Achese, who announced the suspension of the strike; the National President of PTD, Comrade Salimon Akanni Oladiti, his NARTO counterpart, Alh. Kassim Ibrahim Bataiya; and Chairman of House of Representatives Committee on Downstream, Honourable Joseph Akinlaja.

Power Supply Fluctuates as Abuja Disco Targets 0% Electrical Accident for 2017

The Abuja Electricity Distribution Company (AEDC), has said it would target to achieve a zero per cent electrical accident occurrence in 2017, as against few cases of electrical accidents it recorded in 2016.
The Disco stated this at the commencement of its health and safety sensitisation programme recently, amid the increasing frequency of poor supplies to its customers in the federal capital territory (FCT).
“The previous statistics of electrical accidents necessitated that customers must be sensitised to completely eradicate such occurrences in its network,” said the Managing Director, Ernest Mupwaya.
“Despite the Disco’s award by the Nigerian Electricity Management Services Agency (NEMSA) as the safest network in November 2016, it however had a number of electrocutions, which attracted inquiries and fines from the Nigerian Electricity Regulatory Commission (NERC).”
One of such electrocutions was in Lugbe area of Abuja where about three persons died, and a couple others injured from poor electrical connections.
However, the Disco’s Director of Risk and Compliance, Collins Chabuka, said at the event, which was held in Mpape area of Abuja, that AEDC would engage communities on the best safety practices in their use of electricity.
He noted that this became necessary following reports that 69 per cent of the electrical accidents it recorded in 2016 were on account of third party (customers) poor handling of electricity.
Chabuka urged customers to desist from patronising illegal and unauthorised electricians whom he described as ‘NEPA 2’ to get supplies from the Disco’s network.
He also advised house owners to often run earth lines on their building to absorb power in the event of a power surge in the network.
“This will help to reduce cases of electrical accidents and electrocutions in the network,” he said.
He also spoke on vandalism of the Disco’s assets, and begged its customers to help identify suspects.
On by-pass of meter and energy theft, he stated: “If AEDC finds out that this is what you have done, we will prosecute you immediately. It is either you pay a huge fine or go to jail after all court processes.”

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