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April 1, 2023

Nigeria has generated only 5000 megawatts since I was born — Femi Otedola laments

Femi Otedola appointed chairman First Bank Holdings

… As Geregu pumps $250m into power generation expansion project, marks one year on Stock Exchange

By Prisca Sam-Duru

To say that it is ‘appalling and disheartening’ that Nigeria’s power sector is yet to witness the needed improvement for greater impact on the people and the economy despite the huge amount of money sunk into it by successive governments is an understatement.

That, however, was how the Executive Chairman, Board of Directors, Geregu Power Plc, Mr Femi Otedola described the state of the power sector during the week.

Otedola who though, who acknowledged that the sector has its challenges, noted however that, they are surmountable problems. The major problem he pointed out, is transmission and everyone wonders as he did, why it has seemed impossible for successive governments to fix the issue of transmission.

Baring his mind on the sector while speaking at the “Closing Gong ceremony” and commemoration of the first Annual General Meeting (AGM) of the company on the floor of the Nigerian Exchange Limited (NGX) in Lagos, Otedola revealed the hard truth that if the power sector was well organised it would be cheaper and have a lot of positive impact on the manufacturing sector as well as the entire economy of the country.

“The power sector has a lot of problems but they’re surmountable problems. It’s a matter of leadership in the country and willpower. If power is well organised, it’s even cheaper.

“We will get there, it’s a matter of time.”

The business mogul queried why it’s difficult for the country to improve on the amount of power it generates when an individual like Aliko Dangote, has built 2000 megawatts for his plants. “Aliko, an individual has built 2000 megawatts of power for cement, fertilizer plants and refinery. And the country where I was born, has only 5000 megawatts. “So it’s appalling and disheartening that all the successive governments have failed in this regard but I believe we are now at the stage where the power sector will get a lot of attention and priority. We have new plants still sitting idle that the government built years ago and the real problem is transmission, there is a need to look in this direction,” he said.

He further said that Geregu was taking necessary steps to expand its capacity to deliver improved performance and maximise shareholders’ wealth, stressing that the challenges in the sector could be tackled if the government sets its priority right. For starters, he believes that the best way would be the engagement of investors in the sector.

“Any government that thinks well will look for entrepreneurs in this sector that have committed so much capital and time and let them sort out the problem.

“If the government then did not invite Aliko to build a cement factory and create an enabling environment, today we’ll still be importing cement.”

While celebrating Geregu’s achievements on its first anniversary as a listed company, Otedola emphasised that for any company to sustain its wealth, there was a need for it to be listed on the stock exchange.

“To sustain wealth, you need to list your company on the stock exchange”, he stated, adding, “We’ve come with a lot of firsts; the first power company to list on the Exchange, the first power company to embark on an aggressive 300 % expansion drive; the first company to release its results on the stock market.”

In a related development, Doron Grupper, a director of the power holding company, who is satisfied with the achievements of the power company so far, disclosed that Geregu boasts of professionals and good management to increase its capacity. “I’ve been with Geregu for years now since we started the power station. I think this power station according to my experience, works on natural gas. We have a great team of professionals, and good management to increase our capacity.

“We are producing today, 450 megawatts but we have the potential for the next two years to increase to 1300 megawatts. We have the money, and we have the people but we need the assistance of the government of Nigeria to solve some problems with the gas issues.

“We have a huge potential to increase and to contribute to Nigeria in the power sector and to increase the quantities and capacity of electricity to the people of Nigeria.”

Grupper who spoke to Arise, TV correspondent, on the sideline of the NGX event on Tuesday, stated that the gas challenges have to do with the price of gas which he noted, is still low so there’s a need to increase it. The challenges also have to do with the quantity of gas and, “the pressure of the pipeline; we need to increase it. These are the three main issues that the government need to take care of and to assist us to increase the capacity.”

“I hope that in the near future, we will come into a new era of electricity here in Nigeria,” he added.

On how much investments have been put in Geregu, he said, “When we bought the power station back in 2015 we produced 113 megawatts. We made a major overhaul to get to 450. Now, we are doing a major overhaul again…more than 250 million dollars altogether.”