Our agreement with FG in 2013 was already binding then — Azura

As reactions continue to trail the reported Senate debate about the Azura-Edo Independent Power Project (IPP), management of Azura Power West Africa Ltd – the plant’s parent company, has said the contract for the project signed with the Federal Government between the periods of 2013 and 2014 was binding and in force, at the time the Power Purchase Agreement (PPA) was signed in April 2013.

This clarification is coming against the backdrop of reports that an indemnity agreement signed in 2015 was what effected the PPA. Differing on that score Azura management said PPA signed in 2014 was legally enforceable then.

The company also stated that the terms of all the agreements signed for the project are not inimical to the development of the country, as erroneously alluded to in some media report.

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The company’s position is contained a statement released on Monday, July 27, 2020, ostensibly to properly situate the debate about the signing of the contract and the conditions therein.

According to the management, “in the preceding weeks, a number of media outlets have published articles mentioning the Azura-Edo IPP. As the facts and dates cited therein are occasionally incorrect or misleading, we thought it might be helpful to issue a brief guide to the project’s chronology.”

The company said what the Buhari administration did in 2015 was to execute the legal opinion but added that without it the PPA was already in force.

Re-emphasizing the company’s position on the matter in an interview on the popular television station, the Managing Director of Azura Power West Africa, Mr. Edu Okeke insisted that negotiations between government representatives and other parties in the contract started long ago and culminated in the signing of the Power Purchase Agreement (PPA) in 2013 which was later amended and signed in 2014. He said by then the agreement had the legal force and was already in effect in all considerations.

According to him, “the journey for Azura started a long time ago, this is something the founders and promoters started in 2009.

After the feasibility study was completed, the negotiation with the Nigerian government started in 2010. That was a very long process because before then, Nigeria had not had an Independent Power Plant. It was always being built by the government.

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“To get that process going, a lot of parties had to be involved, it was about the Nigerian government, it was about lenders – most of the lenders were developing financial institutions from different parts of the world.

That negotiation took quite a long time, also the World Bank was actively involved, and it culminated in the signing of the PPA in 2013 and this was later amended and signed in 2014.

“The process started after the signing of the contract in 2014 and it ended sometime in December 2015. In the process also, part of the conditions precedent was, getting a legal opinion.

So, the government being a continuum, the Buhari administration continued with the process that started long before it came into office, they saw the merit of the project and executed the legal opinion and that led to the financial closing in 2015.”


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