2023 budget financing: 5 Power plants up for sale as FG, Govs reach agreement

The five power plants involved are located in Geregu, Omotosho, Olorunshogo, Calabar and Benin-Ihovbor and as of 2022, have gulped about $7.875 billion.

This development was confirmed by the Director-General, Bureau of Public Enterprises, BPE, Alex Okoh, who disclosed this in Abuja on Tuesday.

Both the FG and the state governments finally reached an agreement last week after over two years of legal tussle over the sale of the NIPP plants being managed by the Niger Delta Power Holding Company.

The current ownership structure of the assets has allocated 53 percent equity in NIPPs to the states, while a 47 percent stake is owned by the Federal Government.

The National Council on Privatization had in April 2021, given the go-ahead for the adoption of a fast-track strategy for the privatization of the affected power plants (10 at the time) and 16 firms were announced as pre-qualified bidding firms.

The Nigeria Governors’ Forum, through their Chairman, Governor Aminu Tambuwal of Sokoto State, instituted a court case in rejection of the plan by the FG and the BPE to go ahead with the sale of the plants.

The BPE however, explained that the legal tussle has been put to rest and the matter has been resolved as both teams have agreed that the proceeds from the assets would be used to fund the 2023 budget.

Okoh said, “The expectation (of BPE) in the fiscal plan for 2023 is N260bn and the key assets that we are looking at are the power assets. Five of the NIPP plants; incidentally we are reaching some understanding with the state governors for the sale of those five power plants”.

On the revenue sharing formula, the BPE boss confirmed that from the projected sum from the sale of the assets, the FG would be taking 47 percent for the funding of the federal budget while 53 percent will be allocated to the states.