FG Hires Foreign Experts for N458m to Drive ERGP Implementation

•  Negotiates release of $4.92bn Mambilla Plant loan
•   FEC approves N27bn for construction of Gombe-Biu Road

Omololu Ogunmade and Chineme Okafor in Abuja

The Federal Executive Council (FEC) rose from its weekly meeting in the State House, Abuja Wednesday with a resolution to engage foreign consultants from Malaysia to conduct a forensic study that will boost the implementation of the Economic Recovery and Growth Plan (ERGP).

The meeting, presided over by Vice-President Yemi Osinbajo, which approved N458 million for the exercise, put the duration of the forensic study at three months to be undertaken in three phases.

The council categorised the three phases of the study as pre-laboratory, laboratory and post laboratory stages, which it said would include the involvement of 100 persons from both the public and private sectors.
The foreign consultants are expected to bring into the economic plan their international experience, which the council believes will enhance the credibility of ERGP.

Briefing State House correspondents at the end of the meeting, the Minister of Budget and National Planning, Senator Udoma Udo Udoma, said the consultants would conduct the forensic tests on power, transportation, gas, manufacturing and processing.

According to Udoma, the move will involve the evaluation of the growth plan in accordance with set targets and progress with detailed account of implementation including performance indicators.

“Today, the Federal Executive Council approved a memorandum that was brought by the Ministry of Budget and National Planning to retain some consultants to help us to conduct some pilot laboratories. This is part of our implementation strategy for the Economic Recovery and Growth Plan (ERGP) and so, we intend to conduct three labs – one in agriculture and transportation, one in power and gas and one in manufacturing and processing.

“The key objectives of the labs are as follows: one is to identify all relevant key stakeholders from the public and private sectors that are crucial in the delivery and implementation of the ERGP initiative so as to create ownership early in the development process. We will review and re-evaluate the ERGP and sectoral plans against set targets and progress and will include identifying gaps in the current economic system and the key success factors.
“It will further deliver detailed a three-phase implementation programme line by line. We will identify entry point projects. We will identify key performance indicators, breaking down silos and encouraging key players. Now, the focus of the labs is to mobilise private sector investment to finance specific capital projects as you know public resources are limited. So, these labs will bring in private sector players. We will look at the various areas including: infrastructure, manufacturing and bring them in and mobilise private sector financing and resources for the labs.

“So, what council has approved today (yesterday) is that we bring in some consultants who did a similar thing in Malaysia to try to help us build our own capacity. They will just help us at the beginning and after that, we will take over and do it ourselves,” he said.

In his own briefing, the Minister of Power, Works and Housing, Mr. Babatunde Fashola, said he presented two memoranda to the council which he said had relations with economic issues.

According to him, one of the memoranda sought FEC’s approval for N27.23 billion contract for the construction of the 117-kilometre Gombe-Biu road while the other had to do with the revised national building code which he said was eight years behind its scheduled date. He said the first code came into existence in 2006 and was revised in 2009.

“The strategic importance of the road is undeniable. It supports agriculture, access to our power plants – Dadin Kowa hydro power plants. It also helps security logistics to move personnel and troops to respond to distress calls. It is also going to be critical in the resettlement of internally displaced persons (IDPS). It’s part of the North-east development plan. So, it ticks all the boxes in terms of development and so on and also as far as budget implementation is concerned, this is one further step in that direction.

“The other matter which speaks to investment in our people, security of lives and property is the revised Nigeria national building code and this code is eight years behind its scheduled date and the first code was delivered in 2006 and it was revised in 2009 and since then, it was stalled,” he said.
Fashola said the content of the code would improve fire protection systems in buildings and enhance energy efficiency and green building methods in the national standards.

FG Negotiates Release of $4.92bn Mambilla Plant Loan

The federal government also said Wednesday that it has begun negotiating modalities for the release of the $4.92 billion loan it is expecting from the China Exim Bank as part of funding for the 3,050 megawatts (MW) capacity Mambilla hydro power plant.
The Minister of Power, Works and Housing, Fashola, stated this at a workshop on the Power Sector Recovery Programme (PSRP) in Abuja.

Fashola noted that having signed the contract for the construction of the hydro plant last Friday with three Chinese firms – China Gezhouba Group Corporation (CGGC), Sinohydro Corporation Limited (SHC) and CGCOC Group Co. Limited, the ministry of finance had taken over the process and was in negotiation with the China Exim Bank to determine the terms in the loan.

He said until this was concluded and Nigeria guaranteed of the loan, it was difficult to state exactly when work on the project would commence.

He, however, noted that preliminary works such as mapping out of travel routes for ease of movement of heavy machineries had started amongst others.

Falola said: “The signing of the contract for the construction had taken place last Friday. It is supposed to be funded by the China Exim Bank. The negotiations for the loan will now start.

“For this period, I am waiting because it is now the ministry of finance that has taken over. They are the ones who do treasury works, and raise loans for Nigeria.”
He added: “So, we do the negotiations and when we secure the loan, then we are able to tell you that this is the start date.

“There is a lot of preparatory works going on and we should have signed a MoU with the Taraba State government. We have already got a liaison office in the state, the governor did that. We also constituted the project team, the contractors have already started route estimation and analysis; how they are going to move heavy equipment and all of that; and there will be a lot more of that to come. It is a big contract.”
Last Friday, the government signed the agreement for the construction of Mambilla within six years with the Chinese companies.

The project, which is expected to cost $5.79 billion, would have its funding come from the Nigerian government and Chinese lenders through the China Exim Bank, on the ratio of 15 to 85 per cent respectively.

Within the deal, the Chinese Exim Bank and other Chinese lenders are expected to provide $4.92 billion representing 85 per cent of the project’s cost while the federal government will put forward $868.87 million which represents the 15 per cent it ought to bring to the table to build the power plant.

Also, the scope of work for the project include four large dams – Nya, Sumsum, Nghu and Api Weir, two underground power house of 12 units of 250MW each, two numbers of 330kV of 700 kilometres transmission lines to Markudi and Jalingo, 120 kilometres of access roads connecting the project site and nearby communities and resettlement of an estimated 100,000 impacted persons.

Already, the Federal Executive Council (FEC) approved on August 30, the total sum of $5,792,497,062.00 for the project which has reportedly been in the making for over 40 years.

That approval thus paved the way for the signing of the contract document with the China Gezhouba Group Corporation (CGGC), Sinohydro Corporation Limited (SHC) and CGCOC Group Co. Limited, all considered a joint venture.
It also now allowed the federal government to seek finance to meet its counterpart funding obligation to the project.

Similarly, the Mambilla hydro project which is located in Sarduana Local Government Area of Taraba State had its first preliminary feasibility study reportedly carried out by Moto Columbus in 1972. Between 1981-1985, Diyam Consultants with Binnie and Partners UK also carried out another preliminary study and recommended a 3960MW capacity plant.

In 2011 however FEC awarded another consultancy services for detailed engineering design and project management and supervision to Messrs Coyne et Bellier/Decrwon/WADSCO JV Consultants to further review the two previous studies based on new hydrology and geology investigation.