World Bank, IFC, MIGA approve N191bn to support Nigeria power project

The World Bank, the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA), had approved 1.18 billion dollars about N191billion to support Nigeria in boosting its power generation.

This is contained in a statement by Mr Bamidele Oladokun, Communication Associate to the World Bank, in Abuja on Wednesday. It stated that the donors approved the loans and guarantees to support a series of energy projects that would help boost independent power generation and reduce energy shortages in Nigeria.

“The World Bank approved up to US$245 million for the 459-megawatt Azura Edo power plant, near Benin City, Edo; and US$150 million for the 533-mw Qua Iboe plant in Ibeno, Akwa Ibom. Both plants are gas-fired. The Boards of IFC and MIGA also approved loans and hedging instruments of up to US$135 million and guarantees of up to US$659 million for the Azura Edo project,’’ it stated.

It stated that Nigeria was endowed with abundant energy resources, including the world’s eighth largest reserves of natural gas yet 65 per cent of the country’s population had no access to electricity.

It added that unlocking the flow of Nigeria’s extensive natural gas reserves would expand power supply and energy exports to neighbouring countries in the West Africa Power Pool. The statement said that supporting private sector-financed independent power producers (IPPs) formed a critical part of the Nigerian government’s Power Sector Reform Roadmap.

It said this was a strategy to improve power services throughout the country that was widely supported by the Nigerian public. It quoted the Vice President, Africa Region World Bank, Mr Makhtar Diop, as saying efficient, affordable and reliable access to electricity is essential for small and medium-sized enterprises in Nigeria to accelerate job creation.

“I am glad that we were able to support Nigeria’s extensive energy reform programme. We are also to provide direct assistance to increase generation capacity by mobilising nearly US$1.7 billion of private sector financing through a range of instruments,’’ Diop said. Diop said the IBRD guarantees, included forward-looking mitigation and risk-sharing arrangements, designed to augment the country’s power sector reforms while building market confidence and setting industry benchmarks.

He explained that the IFC’s investment and MIGA’s guarantee for the Azura Edo power plant would support a trail blazing project at the centre of Nigeria’s ambitious power sector programme.

The statement also quoted the IFC Regional Vice President, Mr Jean Philippe, as saying “for energy issues to be addressed in Nigeria both the public and private sectors needed to invest in it.

“The World Bank’s group could help catalyse significant private investment in an environment that best assures successful delivery of increased power supply,” he said.

The Vice President and Chief Operating Officer of MIGA, Mr Michel Wormser, was also quoted as saying, “the Azura Edo IPP was expected to have a strong demonstration effect. It will also set a precedent for future private sector investors in the country.’’