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GE reaches MoU for $10 billion investment in Nigeria
- 12 years ago (2012-03-27)
- Junior Isles
General Electric has agreed a memorandum of understanding with Nigeria for $10 billion of investment in new power plants, in which it will have a 10-15 per cent equity stake, a Nigerian power ministry spokesman has said.
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The spokesman said GE would be joining with the government and its power partners to assist in the post-privatisation development of Nigeria's dilapidated power sector.
Nigeria has been seeking to build new gas-fired generation to take advantage of its huge natural gas reserves. The spokesman declined to give specifics as to what kind of power stations GE would be investing in.
Nigeria last month again postponed sale of state-owned power assets, diminishing chances of completing its privatisation reforms any time soon.
President Goodluck Jonathan unveiled the power privatisation plans 18 months ago as his flagship policy and committed to state power generation and distribution assets being sold off last year.
Many observers see power shortages as the main bottleneck to broad-based growth in Nigeria. GDP grew 7.68 per cent in the last quarter of 2011, official statistics showed, with much of this from the non-oil sector.
Nigeria plans to award a management contract for power transmission, and privatise most of its six power generation plants and 11 distribution companies.
Manitoba Hydro of Canada, and state-owned Power Grid of India, are the two companies short-listed for the transmission management contract.
It was hoped generation of 6000 MW would have be reached by the end of 2012, up from 4000 MW. Though this is still far from the estimated 40 000 MW needed by the Nigerian economy.