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BUSINESS

NBET Pays N42bn to GenCos for November 2021 Power Supply

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By Joseph Amah, Abuja

The Nigerian Bulk Electricity Trading Plc on yesterday disclosed that it remitted N42 billion to power generation companies (GenCos) for electricity supplied to the national grid in November 2021.

The bulk trader in a statement in Abuja explained that the payments were a combination of market receipts and supplementary payments from Electricity Distribution Companies (DisCos) made to NBET.

NBET said it processed market payment of N42,486,673,723.

75  to the power generators for the November 2021 Payment Cycle for grid distributed electricity.

It stated that these payments were made last week to GenCos for delivered electricity to the National grid during the period.

“DisCos and GenCos payments are based on the electricity market settlement”, it added.

NBET explained that “Market Settlement Statement are issued in arrears by the Market Operator (MO) following a period of 28 days after a cycle. The MO takes the readings of the various meters via the grid network to determine the quantum of electricity supplied to the grid by each generation companies into the national pool, which is then wheeled via the transmission network to the distribution companies and subsequently to the end-users.

“The settlement statement forms the basis of invoicing and processing of payments to the GenCos”.

NBET said it has continued to ensure “timely payments to generating companies for energy generated and distributed to end users via the grid despite the average market performance of DisCos”.

NBET Head of Corporate Communications, Ms. Henrietta Ighomrore, in the statement, added that the payments were made following its internal payment committee meetings and approval by management.

“NBET continues to fulfill its mandate in ensuring an efficient and effective transactions environment for the bulk purchase and resale of power in the Nigerian Electricity Supply Industry.

“For the 2021 payment cycle, NBET processed an average of N68 billion worth of electricity via the grid, making sure that GenCos received an average minimum settlement of 85 per cent of generation invoices”, she said.

According to her, for January – June 2021 settlement cycle, NBET ensured that all GenCos received payment of 90 – 99 per cent of generation invoices for grid distributed electricity through the NBET Payment Assurance Facility (PAF) and market receipts.

NBET named Eko Electricity Distribution Company (EKEDC) as the best performing DisCo with a rating of 93 per cent of its Minimum Remittance Order (MRO) for November, 2021 while Abuja Electricity Distribution Company (AEDC) and Kaduna Electricity Distribution Company (KEDCO) were named as the least performing companies with both remitting below 20 per cent of the MRO.

“The increase, timeliness and consistency in payments to the GENCOS has ensured stability of the national grid and sustained power generation across the country. It is evident that the quantum of power delivered to the grid has been on a steady increase as GenCos can leverage payments to third parties and ensure maintenance of their plants.

“With a new license, NBET is suitably positioned to lead the NESI towards a viable power exchange for the good of the sector”, Ms Ighomrore added.

Economy

Selloffs in Dangote Cement, MTN, others Push Equity own by 1.23%

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Selloffs in the shares of Dangote Cement, Conoil, MTN Nigeria, among others, on Friday, dragged the equity market’s performance indices down by 1.23 per cent to close the week’s trading sessions.

Specifically, investors lost N672 billion or 1.24 per cent, as the market capitalisation, which opened at N54.

707 trillion, closed at N54.035 trillion.

The All-Share Index also lost 1.

24 per cent or 1.228.32 point, to settle at 98,751.98, as against 99,980.3 recorded on Thursday.

Consequently, the Year-To-Date (YTD) return on the index dropped to 32.07per cent.

Selloffs in Dangote Cement, MTN Nigeria,  Fidelity Bank, Sovereign Trust Insurance and Nestle made the market performance to be on a negative terrain.

Analysis of the market activities showed trade turnover drop when compared to the previous session, with the value of transactions down 22.01 per cent.

A total of 367.62 million shares valued at N6.78 billion were exchanged in 9,168 deals, compared to 542.95 million shares valued at N8.70 billion exchanged in 9,650 deals posted previously.

Meanwhile, Dangote Cement and Conoil led the losers table by percentage terms of 10 each to close at N135, N90.90 per share respectively.

MTN trailed by 9.96 per cent to close at N200.70, Thomas Wyatt Nigeria lost 9.78 per cent to close at N2.03, while Sovereign Trust Insurance shed 6.52 per cent to close at 43k per share.

On the gainers table, The Initiative Plc and FTN Cocoa Processors led by 10 per cent each to close at N1.98 and N1.65 per share respectively.

Juli Plc followed closely by 9.97 per cent to close at N3.75, Champion Breweries Plc gained 9.94 per cent to close at N3.76 and PZ Nigeria rose by 9.93 per cent to close at N33.75 per share.

On the activity table, Transcorp led in volume with trade of 57.00 million shares valued at N792.05 million, while Access Corporation sold 31.77 million shares worth N667.8 million.

United Bank of Africa (UBA) traded 28.50 million shares valued at N674.07 million and Fidelity Bank transacted 28.07 million shares worth N297.65.

Also, First City Monumental Bank(FCMB) sold 27.92 million shares worth N227.22 million.

However, market breadth closed positive with 43 gainers and eight losers on the trading floor.(NAN)

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BUSINESS

Geometric Power Commissions Afreximbank-backed 141mw Aba Integrated Power Project

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By Tony Obiechina, Abuja

The 141 MW Aba Integrated Power Project (Aba IPP), an Afreximbank-financed project, was officially commissioned in Abia State by the Vice President of the Federal Republic of Nigeria, H.E Kashim Shettima. A first of its kind in Nigeria, the Aba IPP is a pioneering initiative capable of generating and distributing 141 MW of its produced power across nine local government areas (LGAs) within the Aba ring-fenced zone.

Adequate distribution of energy is a cornerstone for national development, playing a critical role in facilitating industrialization and trade.

Recognising the challenges in the sector such as inadequate liquidity, high level of debt, and a lack of profitability, Afreximbank continues to support energy projects on the continent and has committed in excess of US$ 4.
6 billion to Africa’s power sector since inception. With approximately USD 900 million of funding in Nigeria, the Bank is one of the leading financiers in the Nigerian power sector. In 2021, Afreximbank signed a US$50 million term loan facility with Geometric Power Limited to support the completion of the generation and distribution infrastructure, commissioning of the gas supply pipeline and commencement of operations of the project.

Speaking at the official launch ceremony, Prof. Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank said: “Afreximbank is proud to be part of this great milestone achievement in Nigeria. The 141MW Aba IPP underscores what can be achieved when public and private sector stakeholders join forces to impact humanity. As champions of trade and industrialization initiatives in Africa, we believe that it is projects like this embedded IPP that will catalyze trade and economic development in Nigeria and across the region.”  

The Aba IPP is unique as it is the only electricity company in Nigeria that is fully vertically integrated with embedded generation and distribution capabilities. This model ensures the Aba IPP can supply power directly to its immediate community, prioritizing local needs and distributing surplus power to Nigeria’s national power grid. This ground-breaking approach ensures constant power supply in the ring-fenced area and addressing the challenges associated with the national power grid. Furthermore, the integrated structure fosters value creation through improved cost management at various stages in the energy value chain: generation, distribution, and collection.

The Aba IPP is equipped with renowned world class infrastructure including three GE LM6000 Gas turbines, with a capacity to produce up to 47MW each. The power plant is also equipped with a 27km gas pipeline to ensure consistent fuel supply, three rehabilitated distribution substations, five new additional substations and 140km of 33kV/11kV lines using fibre optic cables for seamless data communication.

Strategically positioned in the industrial South-Eastern Nigeria, the Aba metropolis is one of the most commercial areas in West Africa, renowned for its cottage and small-scale industries specialising in the craftsmanship of leather goods, fabrics and related services. In addition to increased power supply and reliability, the Aba IPP is expected to enhance industrialization efforts and increase production of small and medium-scale enterprises, as well as local industries.

According to Geometric power, over 370,000 direct and indirect jobs would be created during the operational phase of the project. In addition, there are significant indirect benefits for the supporting industries including the development of road infrastructure, improvement in local services including enhanced water supply, schools and healthcare facilities, a boost in agricultural productivity due to a more reliable power supply, as well as increased support for rural electrification programs and enhanced tourism and leisure opportunities.

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BUSINESS

Economy Grows Under Tinubu – IMPI

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By Tony Obiechina, Abuja

The Independent Media and Policy Initiative IMPI is convinced that Nigeria will witness economic growth in 2024, on the basis of the GDP figure of the last quarter of 2023

In a statement signed by its Chairman Niyi Akinsiju, IMPI said it expects the growth to be driven by the non-oil sector and expansion in the financial sector as the Central Bank of Nigeria battles to tame inflation rate and stabilize the foreign exchange rate.

The policy group explained that its position is based on a careful study of the latest GDP figure released by the National Bureau of Statistics (NBS) that also showed a sharp rebound in the oil production after a 3-year contraction.

It said:”According to NBS, real growth of the oil sector will spiral upward to 12.11 percent year on year in Q4 2023.

“This indicated an increase of 25.50 percentage points (highest in the last three years) compared to the rate recorded in the corresponding quarter of 2022 which was -13.38 percent. Growth also increased by 12.96 percentage points when compared to Q3 2023 which was -0.85 per cent.

“By way of production breakdown, the nation in the fourth quarter of 2023, recorded an average daily oil production of 1.55 million barrels per day (mbpd), higher than the daily average production of 1.34mbpd recorded in the same quarter of 2022 by 0.21mbpd.

“This is higher than the production volume of the third quarter of 2023, which is 1.45mbpd, an increase of 0.10mbpd. This has implications for inflow of foreign exchange because the nation depends on crude oil export for more than 90 percent of its foreign exchange earnings.

“The principal explanation for this impressive crude oil production increase is that the country now has about 30 functioning rigs in its upstream oil and gas sector.

“According to OPEC data, Nigeria’s average rigs count was 11, 7, and 20 in 2020, 2021 and 2022 respectively. Rig count is a measure of vibrant activities in the oil industry. It also referred to the number of active drilling rigs extracting oil from the ground at a given time. It is an important metric in the oil and gas industry as it provides insight into the level of drilling activity, which can influence oil production levels and market dynamics.

“The draw down from this is that the Tinubu administration must have rolled up its sleeves and went to work to redeem the nation’s problematic crude oil production activities as soon as it was sworn into office.”

It is against the backdrop of the performance of the oil sector as well as the non-oil that IMPI envisages further economic growth.

“By our conservative estimation, we can posit that the economy may have survived the most elementally critical stage as it adjusts to the subsidy removal policy and unification of the foreign exchange rates. We, therefore, envisage an economic growth trajectory, even in the face of prevailing challenges confronting the economy.

“We are confident of increased GDP growth in 2024, buoyed by the non-oil sector and driven by expansion in the financial sector which shall benefit from regulatory increase in interest rates as the Central Bank of Nigeria battles to tame inflation and stabilize the foreign exchange rate. These will act together to impact the living standards of the citizens in the months ahead,” it added.

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