Africa’s second largest hydro power project to take off after legal tussle

Over 40 years after the idea of the Mambila hydropower project was conceived and design approved, the Federal Government appeared to have overcome a major stumbling block that has been stalling the progress of the project.

The Minister of Power, Sale Mamman, disclosed that the power project, which is reputed to be the second-largest hydroelectric plant in Africa is back on track after the government settled a legal dispute that was delaying it.

Babatunde Fashola

In an interview in Abuja, the Minister said, ‘’We have overcome the major problem stopping this project and it is nearly over.”

He said that the Attorney General of the Federation, Abubakar Malami is working at finalizing the terms of the settlement that are yet undisclosed. The contract for the Mambila project, which was initially estimated to cost $5.79 billion, was signed in November 2017 by then Minister for Power, Babatunde Raji Fashola, who said that the project would give Nigeria an opportunity to comply with the Paris climate change agreement.

This is because it would be delivering renewable energy as well as giving us the opportunity to unlock the gift of nature to Nigeria in Taraba.

The project was first conceived in the 1970s and is expected to produce 3,050 megawatts of electricity, which is about a quarter of Nigeria’s current installed capacity. The Minister disclosed that an International Arbitration in Paris initiated by Sunrise Power and Transmission Company, which once had the construction contract was recently resolved, removing a major obstacle to the construction of the project.

On the Arbitration Award, Sunrise was seeking an arbitration award of $2.3 billion following the breach of its 2003 agreement by the Nigerian Government, when it granted a separate contract to Chinese companies four years later.

The Export-Import Bank of China had to withhold its interest in financing the Mambilla project due to the legal conflict arising from the breakdown of the agreement.

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Following the resolution, the Minister said he expected the Chinese consortium of China Energy Engineering Corporation and Sinohydro Corporation Limited, who are the project contractors, to start construction this year. The estimated new cost of the project will be $4.8billion, which is about $1 billion less than the earlier estimates.

It would be recalled that President Muhammadu Buhari approved the constitution of two committees namely an inter-ministerial steering committee and project delivery committee last month.

The committee are to ensure the speedy take-off of the project. With about 13,000 megawatts of installed electricity production capacity, Nigeria has about 80% of them coming from gas-fired plants. Only about 7,500 megawatts of that is available with just 4,000 megawatts dispatched to the National grid each day.

The Mambilla hydropower project will be a huge boost towards solving the nation’s energy crises.

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