September 19, 2022

Electricity: Azura pays FG 40% of $30m monthly invoice —MD

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By Obas Esiedesa

 ABUJA- THE Managing Director of Azura-Edo Power Plant, Mr. Edu Okeke, has disclosed that 40 percent of the company’s monthly invoice of about $30 million to the Nigerian Bulk Electricity Trading Plc, NBET, goes back to the Federal Government as payment for gas supply and repayment of loans taken for the construction of the plant.

Okeke told journalists at the plant that the company pays $10 million monthly to gas suppliers including Seplat Petroleum, Nigerian Petroleum Development Company, NPDC, and the Nigerian Gas Company, subsidiaries of NNPC Limited.

He said the company also pays the Bank of Industry, BoI, for the loan collected from the Central Bank of Nigeria, CBN, to build the plant.

He explained: “Every power plant invoice is made up of two parts, capacity and energy produced. Capacity is what you can put on the grid but only those companies with effective PPAs (power purchase agreement) get paid for capacity. We have five of these in the country: Azura, Omotosho, Olorunsogo, Okpai and Afam.

“Then the second part which is about 50 percent of the invoice is what you put on the grid. So if TCN is not evacuating us fully we will lose money on energy supplied. The thing is that they pay us our invoice fully because we have a mechanism to ask them to pay us but they owe the others. For the other power plants without effective PPAs what happens is that if you generate 20MW for instance they are paid capacity of 20MW and energy of 20MW.

“For Azura we have a capacity of 452.7MW, so charge NBET for 452.7MW and on the energy side, I will charge them what is actually produced.

“For the $30 million invoice, the day it is paid, 40 percent goes back to the government. About $10 million is used to pay for gas which goes the next day to Seplat/NPDC. NPDC owns about 60 percent of that and about $4 million also goes to NGC, again the government. Of all the lending groups to Azura which is the biggest lender? There are about 16 lenders, the CBN through the Bank of Industry.

“The challenge Azura has is that we need that money to be paid so that we can pay others but there are people who want to be part of paying that money to our suppliers, and we have said no. For gas and loan repayment, we pay $10 million.