OWN CORRESPONDENT, Abuja | Tuesday 09.00am.
NIGERIA is to boost its electricity supply by some 450 megawatts in a deal with one of the Italian oil and gas majors already operational in the country.
In a Memorandum of Understanding between Agip and the Nigerian government, the Italian oil giant will build and operate a power plant to boost electricity supply in the West African country.
The MOU expands the role Agip will play in power generation in Nigeria after the oil company sealed an agreement in April with state-run Nigerian National Petroleum Corp (NNPC) to build and supply gas to the plant. This operation will link with the state power monopoly, NEPA, which runs electricity distribution facility across the country.
Power and Steel Minister Segun Agagu said the power plant, which would cost $240m, would be built in the Niger Delta town of Kwale near an Agip gas plant and will be completed within 30 months.
“The supply of 450 megawatts of electricity into the system will certainly improve our nation’s power supply,” Agagu said at the signing ceremony in the capital Abuja. The government and Agip are now in talks to finalise a power purchase agreement within two months, the minister added.
Nigeria is facing a critical energy problem as electricity generation from domestic power plants continues to decline. Although it has a theoretical generation capacity of nearly 6,000 megawatts, it has been unable to meet the electricity demand of its more than 110 million people, put at 4,000 megawatts, because of rusty power stations neglected under past military regimes.
Last month, the Nigerian government signed a revised agreement with U.S. energy group Enron to provide emergency power supply to the commercial capital Lagos and has also entered into agreement with Exxon Mobil to build a 350 megawatts thermal power plant.
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