The management of Geometric Power has formally acquired the Aba ring-fenced area from Integrated Electricity Limited, a core investor in Enugu Electricity Distribution Company (EEDC), ending a nine-year legal battle over the rightful owner of the project.
The asset was handed over by the National Council on Privatisation (NCP) through the Bureau for Public Enterprises (BPE) at a brief event on Wednesday in Abuja.
Trouble started in 2013 following the privatisation exercise after Interstate Electric acquired 60% of Enugu Electricity Distribution Company (EEDC) from the BPE pursuant to a share sale and purchase agreement.
Subsequently, the distribution licence was issued to EEDC over five states in the South-east, which area also included previously and exclusively licensed Aba Ring-Fenced Area granted to Aba Power Limited (APL).
On this basis, EEDC became the licensee in respect of the Enugu Distribution Area while APL remained the exclusive licensee of the Aba Ring-fenced area, creating a conflict between the two licences.
The conflict was resolved in 2016 with the signing of an agreement carving out the ring-fence from Enugu DISCO for Geometric/Aba Power Limited.
During the brief ceremony, Alex Okoh, director-general of BPE, described the development as soothing and commendable.
According to him, the NCP worked hard to see that the tussle was resolved and that the “right thing was done”.
“The bureau initiated a series of engagements with various stakeholders, which led to one the signing of the agreement between Geometric Power and Integrated Electric Limited, the core investor,” he said.
“I am pleased to announce that we are handing over this asset to a tenacious, very, very tenacious investor who has made a firm commitment to transform the Aba Ring Fence area into a model electric supply franchise, providing quality, stable and appropriately priced electricity to consumers, thereby unlocking the significant economic benefits of this commercial and industrial hub of the regional and national economy.”
Barth Nnaji, chairman of Geometric Power, expressed delight that the legal tussle has ended, adding that his company was ready to provide reliable electricity to Aba.
“The other government sold what was rightfully ours to the people who acquired EEDC. So, they simply bundled Aba as part of EEDC. It was done knowingly. That is why we went to court, and we’re grateful this administration resolved the issues,” he said.
“We’ve paid the acquisition price of $26 million. I used to be on the other side of the fence and what we said during that time was that anybody that’s acquiring a DisCo should have the financial capacity or technical capacity, and was that’s what he brought in.
“We have made the necessary investments required to not have any issues in terms of reliability of power supply. So, we have invested about eight times the amount of the acquisition already.”
According to him, the company has built new substations and new power lines to ensure no disruption in service delivery.
“We have built new substations. We built new power lines, over 140 kilometres of new lines, we built four brand new substations. We’ve built gas pipelines with seven kilometres to ensure that we have gas uninterrupted from Shell to us, etc. So, all these things we’ve done and the whole idea is to ensure that the network is what it is supposed to be,” he added.
The $500 million Geometric/Aba power plant has the capacity to produce and distribute about 141 megawatts (MW) of electricity in its first phase, with new distribution lines, four new sub-stations and three rehabilitated sub-stations.
Each plant is to produce 47 MW of power, supported by a 60 MVA per transformer. The power plant is to be powered by gas and so the company has built a gas plant at Shell company flow station at Owaza in Ukwa West Local Government Area of Abia State and laid a pipeline spanning 27 kilometres to the power plant at Osisioma.
Source: Top Stories
