Rivers’ Multi-billion Naira Power Project Rots Away

The vision was big and laudable. The objective was simple and clear; to provide electricity in all the nooks and crannies of the state. When a former governor, Peter Odili, conceived the idea in 2000, some people saw it as a well conceived project, while others saw it as a nest of fraud to line […]

The vision was big and laudable. The objective was simple and clear; to provide electricity in all the nooks and crannies of the state. When a former governor, Peter Odili, conceived the idea in 2000, some people saw it as a well conceived project, while others saw it as a nest of fraud to line the pockets of the powers within. Leading the pack of critics of the project was the late Dr. Marshall Harry, a prominent politician from the state who accused Odili of using the gas turbine project to defraud the state of its hard earned revenue. At a point, Odili accused Harry and his group of plans to sabotage the project by blowing up the Trans Amadi Gas Turbine which was constructed in 2002. 

Despite the accusations, Odili’s idea for the project was lauded in many quarters in the state as it was aimed at complementing the effort of the federal government in distributing electricity to all parts of the state. 

The state government, from Peter Odili’s administration to that of Rotimi Amaechi, committed over N60 billion in the construction of the gas turbine. But the project has become a subject of bitter political war between Gov. Nyesom Wike and the immediate past governor of the state and Transportation Minister, Rotimi Amaechi. The two prominent politicians are locked in a war of words over who did what on the project.

Worried by the epileptic power supply across the state, Odili, on assumption of office in 1999, bought high calibre generating sets which he delivered to some  communities in the state that were yet to be connected to the national grid. Odili also gave monthly stipends to the communities to fuel the generators. Shortly after that, the need to explore a wider spectrum in power generation came up and the idea of Independent Power Project (IPP) was conceived. The first step in that direction was the extension of the Eleme Gas Turbine power station which was constructed by the defunct OMPADEC to increase its capacity and efficiency from 20MW to 75MW by replacing the GE LM2500 turbine with three 25MW Nuovo Pignone gas turbines.

 A senior electrical engineer in one of the leading turbine companies that were involved in the construction of the gas turbines, said extension work for the Eleme Gas Turbine as awarded by the then administration of Odili included civil works, foundation and piling, provision of a switchgear, 132kv switchboard, cables and synchronising panels for the three turbines. The turbine is located at the Eteo part of Eleme. 

“Other features of the contract include connection to a 132kv grid, supply and installation of a 3 x 25MW frame, five gas turbines, including trade in of the old unit, gas skid, piping, gas heater, as well as canopy for gas turbines and a crane. The contract was awarded to a private firm that is very close to the former governor. Before May 29, 2001, when former President Olusegun Obasanjo commissioned the turbine, the entire Eteo community did not enjoy 24 hours of power. But when the project was completed, Eteo, like some other towns and villages in Ogoni land which have existing network of distribution lines, enjoyed power from the Eleme Gas Turbine until it packed up,” the source stated.

The joy of the residents of Eteo and other adjoining communities in Ogoni knew no bounds as soon as the turbine was hooked up. A resident of the community, Olormati Igwe, said  people of the area enjoyed 24 hours of uninterrupted power when the turbine was switched on. 

Igwe said it was a thing of joy when the turbine was switched on as the entire community and its neighbours were connected to the national grid. We were enjoying 24 hours of uninterrupted power and the current was so heavy that one had to be careful with electrical gadgets. But all that is now history as the turbine is no longer working,” he stated.

The successful extension work at the Eleme Gas Turbine gave birth to the Trans Amadi Gas Turbine in 2002. The N4.2bn turbine which was cited on four hectares has an installed capacity of 136MW. The plant was commissioned in two phases. Phase I consists of a 3 x 12MW solar mars gas turbines commissioned in 2002, while Phase II consists of 4 x 25 MW Nuovo Pignone frame gas turbines commissioned in 2009. Two of the Phase II turbines were procured in 2004 and the other two were bought in 2005. 

The Trans Amadi, which is located in the heart of Port Harcourt, covers about 2600 hectares. The area designated as an industrial district plays host to some multinational companies, manufacturing industries, as well as financial institutions and classic hotels. The area required stable, affordable, regular and reliable power. The power plant was specifically built to cater to the organisations located in the area. Our correspondent gathered that power was also sent to the city’s distribution network to support its allocation from the national grid. The turbine got its natural gas supply from the Shell Petroleum Development Company (SPDC). 

The turbine, according to information obtained from the Rivers State Ministry of Power’s website, has the following facilities, 4 x 25MW GE Nuovo Pignone gas turbines, 3 x 12 MW GE solar mars gas turbines, electric control buildings, 4 x 35MVA transformers, 3 X 75MVA transformers, a turbine canopy with gantry crane, 132kv switchyard, black start generators, as well as 132kv switching facility. The turbine gets it supply of natural gas form Agip. The gas turbine was commissioned by a former President, Olusegun Obasanjo in 2002. The commissioning ceremony was a fanfare as residents and all the companies located in the area were elated that the epileptic power supply witnessed in the area would be a thing of the past. 

“But the joy of the residents was cut short as the cables and all that were required to distribute light were obsolete. This is why the turbine was not put to effective use,” said a Port Harcourt-based electrical engineer, Chris Ogbonna.

Engr. Ogbonna said poor and obsolete distribution equipment stalled the effective use of the turbine.

The Omoku plant has six units of 25MW GE heavy duty gas turbines, making a total of 150MW. The first power generation capability was commissioned in 2006 by then President Olusegun Obasanjo. Our correspondent learnt that it has an installed capacity of 4 x 25 MW Nuovo Pignone gas turbines. It was further gathered that three of the turbines were procured in 2001, while the fourth was procured in 2002. Daily Trust on Sunday also gathered from an engineer attached to the gas turbine, Olu, that the fifth and sixth generating units were also procured in 2005 and commissioned in 2008. 

Omoku has a population of about 33,000. It is located in the northern part of the state and shares boundary with Delta and Imo states. The city was not connected to the national grid, so the First Independent Limited had to spend lots of money to transmit through a 132kv switch yard and distribute power to the environs. As part of the National Integrated Power Project (NIPP), the Federal Government, through the Niger Delta Power Holding Company (NDPHC) is building a 252MW gas turbine power station with 2 x 126MW GE 9EA gas turbines which is expected to interconnect to the existing 150MW power plant at 132 switch yard. Our correspondent learnt that FIPL has supplied electricity valued at over N2bn to neighbouring communities without charge. 

The 150 MW Omoku gas turbine was inaugurated in 2006, but the plant did not improve the power situation in the state. The project was under the investigation of the EFCC based on petitions by indigenes who alleged that the project was overpriced. The outcome of that investigation is still unknown. Daily Trust on Sunday gathered that the project was awarded at N50bn. But experts blamed the failure of the turbine to cover the entire state on the obsolete facilities used by the then Power Holding Company of Nigeria.

The government of Rotimi Amaechi inherited the three gas turbines when it came to power in 2007, but at the last lap of his administration, he divested the gas turbines to an indigenous firm, Sahara Energy. The company acquired 70 per cent of the company, while the Rivers State government retains a 30 per cent stake in the entity. 

A document obtained from the state’s official website indicates that the Rivers State Executive Council, at its 19th meeting held from August 15 to 16, 2012, approved the sale of 70 per cent equity of the state-owned First Independent Power Limited to ND Power-HPS Limited , comprising the 150 Omoku Power Plant, 136MW GT Trans Amadi Power Plant, the 180 MW GT Afam Power Plant and the Eleme 75MW GT Power Plant at a unit price of $800,000.00 per megawatt which when multiplied by 541 megawatts amounts to $432,800.00 per megawatts. Information obtained from the document also shows that 70 per cent of the equity share amounted to $302,960,000. 

But it appeared Gov. Wike was not comfortable with the transaction as barely one month after assuming office, he set up a seven-man judicial commission of inquiry to look into the sale of the states valued assets which included the gas turbines. An official document from the state’s website shows that the governor on June 18, 2015, and pursuant to the provisions of Section 2(CAP. 30) Laws of Rivers State of Nigeria, 1999, constituted a judicial commission to investigate the administration of Amaechi with respect to the sale of valued assets of Rivers State and other related matters. The commission’s terms of reference were as follows: to ascertain the circumstances of the sale of the Omoku 150 megawatts gas turbine, Afam 360 megawatts gas turbine, Trans Amadi 136 megawatts gas turbine and Eleme 75 megawatts turbine by Amaechi’s administration, to identify the purchasers of the turbines, the total cost for which they were sold and the whereabouts of the proceeds of the sales, to ascertain whether the transaction was conducted with the requisite transparency and accountability in accordance with the provisions of extant laws enforced in Rivers State, to determine if the government and the people have any equity left in the said gas turbines and the value of such equity. 

The panel swung into action and came out with a report. The White paper published in 2015 revealed that the sale of the four gas turbines was difficult to justify, considering the enormous investments made by the Rivers State government in the construction of the four turbines and the limited years the turbines served the state. It was also observed in the white paper that the Ministry of Finance Incorporated (MOFI) as the custodian of Rivers State Government’s investments was deliberately excluded from the entire process leading to the sale of the 70 per cent share in the First Independent Power Limited and recommended that all future divestment of Rivers State government investments should pass through the Ministry of Finance Incorporated.

The commission recommended that having regard to the patent defects it identified in the shares contract, the sale should be reviewed in order to give Rivers State Government and its people good value for their investment in the power sector. The commission observed that the sale of 70 per cent equity of First Independent Power Limited by the Rivers State Government under Amaechi to NG Power-HPS Limited not only lacked transparency, but was carried out in flagrant violation of Section 52 of the Rivers State Public Procurement Law No.4 of 2008. 

The commission, thereafter, recommended that Amaechi, along with his Commissioner for Finance and Power, Dr. Chamberlain Peterside, and Sir Augustine Wokocha , should be held to account for their role in the sale of the power generation assets of the First Independent Power Limited and the disbursement of the proceeds . The commission directed the office of the Attorney General and Commissioner for Justice to prosecute all persons who were involved in the transactions in violation of the provisions of the Procurement Law No.4 of 2008 without complying with the requisite due process and global best practices with respect to the sale of such valued assets of government. The panel recommended that Amaechi and a former Military Administrator of the state, Anthony Ukpo, and others who had held public offices, to return N97bn to the state’s coffers. 

Rivers State Commissioner for Information, Barr. Emma Okah, said the transportation minister and others found to have been involved in the alleged misappropriation of state funds must return them or face prosecution. 

Barr. Okah stated that the state government had ordered its Attorney General and Commissioner for Justice, Mr. Chiwe Aguma, to start the process of charging Amaechi and two others to court over the sale of the turbines without due process. Some permanent secretaries who were involved in the transaction were suspended from office. 

The minister and others allegedly involved in the transaction are yet to be prosecuted by the state government. 

Amaechi has denied any complicity in the transaction. He responded through his media team and described the claims by the commission as a “desperate tactic to reduce his rising political profile”. 

Amaechi also went to court to challenge the credibility and legality of the panel.

Some analysts are of the opinion that the continued cold war between the two political gladiators has continued to affect effective power generation in the state as residents and other industrial concerns mostly depend on generating sets. 

The report ws initiated by the Daily Trust Foundation with support from MacArthur Foundation.