In a story in the Nigerian daily The Independent, Obasanjo was asked about the failure of some multinational firms to keep their promises about power generation, which is in crisis in Nigeria, where the infrastructure currently provides hundreds of megawatts less than is needed to support the demands of its growing population.
"It is not a question that they have an IPP programme, there must be sufficient evidence that they are executing it. Mobil had a programme when I came in. Yet, Mobil has not implemented it. We will see each programme, we will follow it and we will see how it is progressing."
The company's commitment to building a power plant is a key link in the plan Obasanjo has developed to move his country into fully meeting the nation's power needs. Participation in the programme is mandatory, and his swipe at Mobil, as ExxonMobil is known there, was the lead item in the paper's business section today.
The phrases "not aligning with the aspirations of this administration" and "shirking their corporate social responsibility" may well be signals that the company has fallen from official favor, an event that could have consequences for its rights bid in the current Joint Development Zone licensing round and far down the line.
His words could also generate attacks from the United States, where the Bush administration tends to take criticism of its oil companies seriously and responds with diplomatic name-calling and trade and tariff threats. The U.S. State Dept. is already doing that, claiming Nigeria and 60 other nations have unfair trade practices.
In an unusually stern warning, President Obasanjo added: "Let me also add that those companies that have either unduly delayed the take-off or completion of their IPPs, or not yet committed to this scheme are not aligning with the aspirations of this administration and are indeed shirking their corporate social responsibility."
To ERHC On The Move, the public criticism is a clear warning to ExxonMobil and a direct confrontation with its policy of delaying all projects for the longest possible time while failing to communicate with officials or the public. It is likely to signal a deeper disaffection with the company than had heretofore been known, and may even indicate that the company's preferential rights in the Joint Development Zone are at risk.
Here is the story:
No IPP, no operation, Presidency tells oil firms
by Charles Okonji
Senior Business Correspondent
OKPAI, Delta State, Nigeria -- From now on, no oil and gas company will get production approval without evidence of executing an Independent Power Plant (IPP), President Olusegun Obasanjo handed down the order at the weekend.
He did while commissioning the IPP built by Nigeria Agip Oil Company at Okpai, Delta State, stressing that the condition is necessary because of the need to utilise gas resources and raise power generation.
It coincided with news that homes and businesses in Lagos, Nigeria’s commercial hub with a 20 million population statewide, are to endure another prolong disruption in supply as generation by the Egbin plant has dropped by more than 200 mega watts (mw).
Egbin, the main supplier to Lagos, is equipped to generate 1320 mw.
National Electric Power Authority (NEPA) Managing Director, Joseph Makoju, said it dwindled because of shortage of gas from the Nigeria Gas Company (NGC).
At Okpai, Obasanjo explained that many multinational joint venture (JV) partners pay lip service to IPPs, which could have enhanced their flare out programme, stating that the government would no longer tolerate such a lukewarm attitude.
His words: “It is not a question that they have an IPP programme, there must be sufficient evidence that they are executing it. Mobil had a programme when I came in. Yet, Mobil has not implemented it. We will see each programme, we will follow it and we will see how it is progressing”.
As producers of natural gas, from which most of the increase in power generation is expected, multinational oil and gas companies, Obasanjo said, should execute IPP that will not only utilise gas, but also enable Nigeria meet its power demand.
He praised Agip for its effort, saying it has worked “assiduously” to deliver the IPP project in two years, identifying with the “urgency the situation in hand demanded.
“Participation in the power sector is only one of the many areas in which we expect the oil and gas industry to champion the current economic revolution in the country.
“Let me also add that those companies that have either unduly delayed the take-off or completion of their IPPs, or not yet committed to this scheme are not aligning with the aspirations of this administration and are indeed shirking their corporate social responsibility”.
Delta State Governor, James Ibori, commended both Obasanjo and Agip for their commitment to power generation, stressing that Okpai IPP would enhance electricity supply and also bring economic development.
The capacity of Egbin power station first reduced to about 1,280 mw last year before plunging to less than 1,080 mw, caused by disagreement between the NGC and Shell Petroleum.
In January this year, a similar dispute between NEPA and NGC over price resulted in the disruption of gas supply to the station. It led to days of erratic power supply to most parts of Lagos.
However, Makoju promised that NEPA would in June begin to overhaul all its power generating stations, “done one at a time, with each taking about three months”, during which period the plant would be shut down.
“Most of the stations have not been overhauled for a long time. We need to carry out this maintenance in order to make them more efficient. We choose the middle of the year to start the maintenance in order to allow the hydro station to fully come up. They will have enough water level at that time to run in full capacity”, he said.
Weekly reports on other power plants across the country showed that Kainji, with 560 mw capacity, generated only 382 mw; Jebba (578.4 mw), produced 272 mw. Shiroro (600 mw) has not generated a dime of it for sometime due to water management problems.
Similarly, Ijora (60 mw) has not yielded electricity since last week due to insufficient fuel; Sapele (240 mw) supplied 158 mw.
Afam generated 193 mw from its 236 mw capacity, Delta produced 363 mw from its full steam of 432 mw.
2 comments:
Hallelujah!
Now he should remind him the Chinese may be interested and are much better players.
Thanks, Joe, for helping us follow a very complex situation. Who knows what this countdown will bring?!
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