The Federal Government will, for the next 30 years, earn a total of $2.1 trillion for concessioning the 700 MW Zungeru hydropower plant.
According to a statement by the Federal Government, the deal is proposed to fetch $70 million per annum, and if this is calculated over 30 years period which is when the concession is supposed to last, the cumulative amount that will accrue to the government will come to $ 2.1 trillion.
The Federal Government on Tuesday officially transferred operations of the Zungeru Hydroelectric Power Plant to Penstock Limited, a subsidiary of Mainstream Energy Solutions Limited, which it selected in February 2023. Tuesday’s move is expected to “boost Nigeria’s power generation capacity and contribute significantly to meeting the country’s growing energy demands,” a statement signed by the Senior Special Assistant to the Vice President on Media and Communications, Stanley Nkwocha, read
According to Nkwocha, the deal was disclosed during the first meeting of the National Council on Privatisation (NCP) for the year 2024 at the Presidential Villa, Abuja.
At the meeting, the NCP announced that the Concession Agreement was signed on December 13, 2023, by the Bureau of Public Enterprises (BPE) and Penstock Limited.
It stated that following the Council’s approval, the Concessionaire fulfilled its obligation by paying 50 percent of the commencement fees on January 5, 2024.
Penstock Energy Ltd is a subsidiary of Mainstream Energy Solution Ltd, the concessionaire of Kainji and Jebba Hydro Power Plants (HPP) with an installed capacity of 760MW and 578.4MW.
Penstock Energy Limited financed the 700MW Zungeru hydropower plant- the second largest hydropower plant in Nigeria with a staggering $1.3bn loan from China.