Rivers governors’ bitter political spat puts $302m power plants on freeze mode
Incumbent governor terminates 541MW plants sold by former governor Economy hit, as unemployment soars at 61.4%
ONE IS A FORMER GOV ERNOR, Chibuike Rotimi Amaechi. The other is the incumbent governor, Nyesom Wike. Both of them are from Rivers State. But a longstanding bitter feud between both men, which has already led to the latter, terminating the sale of 541 megawatts power plants valued at $302 million , is set to roughen up the economy of the state, in a country where the yearning for electricity is palpable, throwing the citizens and businesses into more darkness as a consequence.
The ongoing bitter politics between the two men has gone unabated since May 2015. The two political gladiators of the state, with ample followership, have been locked in a political battle of supremacy in the last three and-a-half years, which has only brought each of them a pyrrhic victory.
The Wike-Amaechi spat has brought in its wake instability in the state, scaring away investors and heavily bashing the $23 billion gross domestic product (GDP) economy. The oil-rich state, with arguably the second largest sub-national economy, only picks up crumbs from foreign direct investments (FDIs) left over from Lagos and Abuja.
Shortly after assuming office, from a deadly fought gubernatorial election in 2015, Wike instituted an inquiry into Amaechi’s eight-year administration. Apart from other findings, the George Omereji Commission reported that former governor Amaechi had unwittingly sold off 70 percent share of the state’s built multi-mil- lion-dollar gas turbine electric power plants at Omoku, Trans Amadi, Eleme and Afam, with total generating capacity of 541 megawatts (MW).
The three major power plants: Omoku (150 megawatts), Trans Amadi (136 megawatts), Afam (180 megawatts) and Eleme (75 megawatts) gas-powered electricity plants also known as First Independent Power Limited, were sold by Amaechi’s administration in late 2014 to NG Power HPS Limited, an affiliate of Sahara Energy Resources Limited, owned by billionaire businessman, Tonye Cole for $308 million. Although, the company later on claimed that it bought the three power plants for only $302 million.
Earlier in the year, the Wike government had asked Amaechi to answer questions on the sale of the three plants, alleging that the N112 billion realised from the ‘sell-off’ was allegedly used by Amaechi to finance the 2015 presidential campaigns of the APC, won by Muhammadu Buhari.
Apparently not satisfied with the non-committal approach of the minister of transportation, last Friday, 21 December, the Wike administration ordered the termination of the share sale contract of 70-percent equity in the government owned power generation assets held by First Independent Power Limited in Omoku, Afam, Trans-Amadi and Eleme Gas Turbines, to NG Power-HPS Limited.
The government also terminated the concession of the Rivers and Bayelsa states owned Olympia Hotel to Cenpropsaroten Hotel Management Limited, as well as the concession agreement between the state and Kild Concession Limited in respect of the construction of a toll road and secondary developments in Abonnema Wharf, Port Harcourt.
Emma Okah, commissioner of Information and Communication said the termination order were part of resolutions at the state executive council meeting presided by Governor Wike.
He claimed that the three companies that had their contracts/concessions terminated are all subsidiaries of Sahara Energy Limited, used by the immediate past governor Amaechi to acquire state assets.
“The State Executive Council meeting arrived at the resolutions in line with yet to be implemented recommendations of the White Paper on the report of the Judicial Commission of Inquiry for the Investigation of the administration of Governor Chibuike Rotimi Amaechi on the sale of Valued Assets of Rivers State and other related matters under the chairmanship of Justice George Omereji,” Okah said in Port Harcourt.
He said the state government has directed the attorney general of the state to take further steps as contained in the White Paper.
Last September, Augustine Wokocha, former commissioner of power under Amaechi, had denied the claims of diversion of funds by his former boss. He said the sale of the power stations was part of efforts to improve revenue of the state, and ensure efficiency.
“This is completely untrue. The money from the gas turbines was budgeted for in the appropriation bills of the state for the period which the transactions occurred. This even formed part of revenue for the government. The record of the state through the budget within the period of that transaction shows that most of infrastructure and projects done by the government were financed by the sales. We applied all the money to the development of the state, in line with the laws of the state. Nothing was used by Rotimi Amaechi to fund any rally or election,” Wokocha had said.
He also countered the claim by Wike administration that the sale was done for $308 million. “The gas turbine stations were sold for $302,960,000 million, contrary to (Governor) Wike’s figure. It was calculated on the basis of selling out 70 per cent of the state holding in the investment. This amounts to $800,000 per megawatt. For the 70 per cent of the volume of power we had then, which was 541MW, and going by analysis, 541MW by $800,000 will give us $432,800,000 million. So, we sold only 70 per cent, which was $302,960,000. The state still owns 30 percent of the asset of the gas turbines,” he said.
Unfortunately, the Nigerian 2016 national economic recession has combined with Rivers’ peculiar politicallymotivated socio-economic crisis to throw up huge unemployment in the state. By the third quarter of last year (Q3 2017), the National Bureau of Statistics (NBS) said the state has unemployment and underemployment rates of 61.4 per cent, surpassing the national average of 18.8 per cent.
Apparently aware of the grim unemployment situation in the state, with the attendant crimes, Wike informed on Monday December 24 that the strategic thrust for the 2019 budget is to promote economic growth and diversification, create jobs and reduce unemployment; take as many of Rivers people out of poverty and improve the standard of living of the oil-rich state.
How he achieves all this would be left to be seen, especially as he embarks on implementing the N480.211 billion budget.