Economy
Sokoto Plant To Generate Power At N178/KW
By Dipo Olowookere
Sokoto State power plant will generate electricity at N178 per kilowatt, more than three times its current price in the region, Daily Trust investigations have shown.
The 38-megawatt Independent Power Plant (IPP) was built by the state at the cost of N3.8 billion and will consume 33, 000 diesel daily.
Data from the Nigerian Electricity Regulatory Commission shows that the highest approved price for residential customers under the Kaduna Distribution Company (Kedco), where Sokoto belongs, is N45 per kilowatt.
The plant “consumes 33,000 litres” of diesel daily, the director-general of the project, Mr Umar Bande, said during a test run of the plant last week.
Daily Trust findings show that the state will be spending an average of N6.8 million daily on diesel at a market value of N206 per litre. By this, the plant will consume N204 million worth of diesel every month.
The annual cost of diesel to be consumed by the plant is N2.47 billion per annum, more than two-third of its worth on fuel every year.
By the estimated 33,000 diesel per day, the plant will gulp 868 litres of diesel to generate one megawatt (1000 kilowatt), amounting to N178,808 for every megawatt, using a market value of N206 per litre of diesel. A kilowatt generated by the Sokoto plant will therefore cost N178.8.
Kaduna Electric, whose network will convey the power to customers, presently sells electricity at N45.76 per kilowatt hour, according to the 2015 Multi-Year Tariff Order (MYTO) approved by NERC.
The Sokoto plant, which contract was awarded in November 2008, has a multiple type turbine that can use diesel, gas or LPFO, Bande said. Officials also said the plant would begin operation after the transmission infrastructure and other minor aspects are completed.
Daily Trust learnt that Kaduna Disco gets an average of eight percent of power daily from the national grid through the Transmission Company of Nigeria (TCN), which it allocates to Kaduna (66 percent), Kebbi (17 percent), Zamfara (nine percent) and Sokoto (eight percent).
The MYTO 2015 shows that residential customers (R2-SP) presently pay N26.37 for every kilowatt hour; the R2-TP pay N28.05; residential customers 3 (R3) pay N42.74, and R4 customers pay N45.76.
Commercial customers under class 1 (C1) pay N33.17; C2 pay N38.88; and C3 pay N44.22. For the industrial customers, D1 customers pay N36.95; D2 pay N39.13, and D3 pay N44.22.
Customers under category A1 (agriculture and public agencies) are paying N33.17, A2 pay N38.56, and A3 pay N39.13. Other customers who use streetlights are put under ST1and they pay N30.30/kilo watt hour.
‘Liquefied Petroleum Gas is better’
A power sector and energy expert, Mr Dan Kunle, said for Nigeria which recently agreed to support clean energy initiative and climate change, Liquefied Petroleum Gas (LPG) could have been the fuel source for the plant as it could be brought in from nearby Niger Republic or from the Niger Delta rather than trucking diesel at a high price.
He however said the state government could only sustain the operation for three to five years by subsidising the fuel cost if having sustained power supply is its key focus at the moment.
“There is nothing government cannot subsidise if it is determined to do that in the most scientific approach. If that is the energy need of Sokoto State Government, they can put that into use and have uninterrupted power per day for the next few years.
“If the impact it will create for industrialization will flow back, then that is good and sustainable. Americans subsidize power up to N200m daily but they do it on scientific basis. It must be subsidized if that is what the government wants,” he said.
Why project is delayed
Daily Trust reports that the project, initially expected to be completed within six months in the first quarter of 2009, was stalled for eight years over what state officials described as “unforeseen circumstances.”
The deadline was first shifted to September 2009, later to December 2010 and to July 2011. It was then extended to September 2013 and later August 2014 and the dates keep changing. Daily Trust findings revealed that the source of fuel for powering the plant is the major reason behind its continuous delay.
“The project was conceived without a proper feasibility study. That is why the issue of fuelling the plant was not properly addressed,” a source said.
Another source said: “They weighed the use of diesel to power the plant’s generators which will consume dozens of trucks of diesel per day. The cost, logistics, safety and even availability of diesel dissuaded the officials from that option.”
But the Chief Operating Officer of the contracting firm, Vulcan Elvaton Ltd, Mr Franklin Ngbor said last week that the turbine of the project had already been tested three times.
He said the synchronisation of the plant with the fuel tank and the main evacuation line, down to the transmission line is the only thing remaining.
“The plant when fully completed, finally fired and integrated into the national grid, can work for five consecutive years, non-stop,” he said.
‘It will boost Sokoto’s economy’
During the last test run, the Secretary to the State Government, Bashir Garba, said an agreement will soon be signed between the state government and the TCN on the evacuation of the power to the national grid.
He said the project was necessitated by the epileptic power supply to the state from the national grid, adding that the state will enjoy nearly 24-hour power supply when the plant becomes fully operational.
“This will also eventually boost the socioeconomic landscape in the state, curb poverty, restiveness and unemployment, among other myriad of direct and indirect benefits,” he said.
Daily Trust
By Aduragbemi Omiyale
More petroleum marketers are looking to take advantage being offered by the Dangote Refinery in Lagos through its bulk-purchase incentives, allowing petrol stations to sell premium motor spirit (PMS), otherwise known as petrol, cheaper to motorists.
Recall that recently, Dangote Refinery entered into a deal with MRS Oil Nigeria, Ardova Plc, Heyden for the purchase of petrol at least two million litres at N909 per litre.
With this agreement, MRS Oil has been able to dispense to customers at a pump price of N935 per litre across its stations in Nigeria.
For those not under this arrangement, they have been battling with price instability, especially after depot owners recently increased their price to N950 per litre from N909 per litre because of the rise in crude oil prices in the international market.
Worried by this and attracted by the bulk-purchase agreement incentives of Dangote Petroleum Refinery, the Independent Petroleum Marketers Association (IPMAN) is already having talks to buy directly from the Lagos-based oil facility.
The national president of the group, Mr Abubakar Maigandi Garima, said members are eager to sign on with Dangote Refinery for the bulk-purchase agreement.
He argued that members could not continue to depend on depot owners for products when they can buy directly from the refinery bearing in mind that the minimum quantity to buy from Dangote Refinery is two million litres at N909 per litre.
The desire to be part of the bulk-purchase agreement, it was also gathered, was also apparently being fuelled by the testimonies from motorists who have been praising the impressive burn rate of fuel sourced from Dangote Refinery and sold in MRS filing stations which they said lasts longer compared to other products imported into the country and sold by others.
The management of the Dangote Refinery, citing economic relief provided by President Bola Ahmed Tinubu’s crude-for-naira swap initiative, had announced a bulk-purchase offer incentives to the three leading downstream sector operators, so that Nigerians could heave a sigh of relief on the reduced pump price.
By Adedapo Adesanya
The World Bank has projected a 3.6 per cent economic growth for Nigerian in 2025 and 2026 on the back of ongoing reforms by the federal government.
The Bretton Wood institution in its report titled Global Economic Prospects, January 2025 published on Thursday, said recent reforms, including subsidy removal, Naira liberalisation and the introduction of tax reform bills would help to boost business confidence.
“In Nigeria, Gross Domestic Product (GDP) growth increased to an estimated 3.3 per cent in 2024, mainly driven by services sector activity, particularly in financial and telecommunication services.
“Macroeconomic and fiscal reforms helped improve business confidence. In response to rising inflation and a weak naira, the central bank tightened monetary policy.
“Meanwhile, the fiscal deficit narrowed due to a surge in revenues driven by the elimination of the implicit foreign exchange subsidy, following the unification of the exchange rate and improved revenue administration,” a part of the report stated.
The World Bank noted that the wider Sub-Saharan Africa, to which Nigeria belongs would see a 4.1 per cent growth in the current year, before seeing a 4.3 per cent rise in 2026.
“Growth in Sub-Saharan Africa, SSA is expected to firm to 4.1 per cent in 2025 and 4.3 per cent in 2026, as financial conditions ease alongside further declines in inflation. Following weaker-than-expected regional growth last year, growth projections for 2025 have been revised upward by 0.2 percentage points, and for 2026 by 0.3 percentage points, with improvements seen across various subgroups. At the country level, projected growth has been upgraded for nearly half of SSA economies in both 2025 and 2026.
“Growth in Nigeria is forecast to strengthen to an average of 3.6 per cent a year in 2025-26. Following monetary policy tightening in 2024, inflation is projected to gradually decline, boosting consumption and supporting growth in the services sector, which continues to be the main driver of growth,” it added.
The global lender disclosed that oil production is expected to increase over the forecast period but remain below the 1.5 million barrels per day quota of the Organisation of the Petroleum Exporting Countries (OPEC).
By Adedapo Adesanya
Four price gainers helped the NASD Over-the-Counter (OTC) Securities Exchange close higher by 0.35 per cent on Thursday, January 16.
The value of the trading platform jumped by N3.69 billion during the session to N1.072 trillion from the N1.068 trillion it closed in the preceding session, and the NASD Unlisted Security Index (NSI) made an addition of 10.67 points to wrap the session at 3,103.83 points compared with 3,093.16 points recorded at the previous session.
Industrial and General Insurance (IGI) Plc added 3 Kobo to its price yesterday to trade at 33 Kobo per unit compared with Wednesday’s closing price of 30 Kobo per unit, Newrest Asl Plc appreciated by N2.85 to N31.18 per share from N28.53 per share, 11 Plc gained N2.90 to close at N256.00 per unit versus the N253.10 per unit it finished a day earlier, and FrieslandCampina Wamco Nigeria Plc grew by 21 Kobo to N39.16 per share, in contrast to midweek’s N38.95 per share.
On Thursday. there was an 85.3 per cent increase in the volume of securities traded by investors to 1.2 million units from the 666,494 units recorded in the preceding session, the value of shares traded surged by 8.9 per cent to N18.0 million from N16.5 million, and the number of deals leapt by 65 per cent to 33 deals from 20 deals.
FrieslandCampina Wamco Nigeria Plc remained the most active stock by value (year-to-date) with 3.4 million units worth N134.9 million, trailed by Geo-Fluids Plc with 8.9 million units sold for N43.0 million, and Afriland Properties Plc valued at 690,825 sold for N11.1 million.
IGI Plc closed the day as the most active stock by volume (year-to-date) with 23.5 million units sold for N5.3 million, followed by Geo-Fluids Plc with 8.9 million units valued at N43.0 million, and FrieslandCampina Wamco Nigeria Plc followed with 3.4 million units worth N134.9 million.
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