Sale Mamman, minister of power, has launched moves to pay the disputed N13.5 billion claims to power plants owned by Deji Adeleke, TheCable gathered.
Sepco-Pacific Energy Co Ltd, owners of Omotosho and Olorunsogo power-generating plants, and the Nigerian Bulk Electricity Trading Plc (NBET) had engaged in a prolonged exchange over the claims.
The disputed claims are in two parts — the N5.2 billion deducted from Sepco-Pacific Energy’s account by NBET in respect of foreign exchange differentials and another N8 billion “surplus payments” to the two GenCos.
NBET had stood its ground despite reported directives from Vice-President Yemi Osinbajo and a ruling by the power industry regulator, the Nigerian Electricity Regulatory Commission (NERC), that the company be paid.
The controversy is believed to have contributed to the non-renewal of the appointment of Marilyn Amobi as NBET MD.
In a letter to Sule Abdulaziz, the acting managing director of the Transmission Company of Nigeria (TCN), Mamman directed that NERC’s rulings “should be obeyed” on the claims by Sepco-Pacific Energy.
The letter was titled: “Re: TCN Disrespect For Sanctity Of Contract: Honourable Minister’s Urgent Intervention Required in Respect To Olorunshogo and Omotosho Power Plants & Others.”
Mamman wrote: “I refer to the captioned subject regarding operational changes by the Management of the Transmission Company of Nigeria (TCN) within the Nigerian Electricity Supply Industry (NESI). Specifically, it has been brought to my notice that in the months of March, April, May & June, the Final Settlement Statements issued by the Market Operator is (are) at variance with the signed PPA contracts of Olorunsogo and Omotosho Power Plants and Others, resulting in discordance within the market.
“The changes to the minimum capacity quantities of Olorunsogo and Omotosho Power Plants and non-compliance by TCN — a government-owned company — to NERC rulings, poses not only operational challenges but also reputational implications for the sector, and by extension, the Federal Government. Further still, the subsistence of such actions will invariably erode investor confidence in the market and may even undermine the legitimacy of our market reform efforts whilst bringing the Government into disrepute.
“I am very much interested in hearing the TCN Management’s position on why the TCN did not comply with the respective minimum contracted quantities of the power plants in question, under the signed PPAs. You are encouraged to furnish my office with the details, to enable the Ministry conduct an independent review of the different positions.
“In light of the above, and to stem further breakdown of contractual relations within the Nigerian Electricity Supply Industry (NESI) and avert costly embarrassment to the government, you are hereby directed to:
“(a) Abide by NERC’s ruling and resolution, as the regulator with regards to its obligation under the Power Purchase Agreement (PPA).
“(b) Provide a report detailing the position of TCN with justifications and any supplementary information that forms the basis of your position on the matter to enable the Ministry conduct an Independent review of the entire matter for effective settlement.
“(d) Note that, all the parties involved; the Regulator (NERC) and Nigerian Bulk Electricity Trading PLC (NBET) will be provided with opportunity to provide their documented position on the matter for an Independent review for the development of policy direction.
The memo was dated August 17, 2019 but TheCable confirmed that the year was an error as the letter was only sent to TCN two weeks. There was no acting MD in August 2019.
Ministry sources confirmed that the memo is the first step in Mamman’s efforts to get the disputed sums paid to Sepco-Pacific Energy after the heated exchanged between the company and NBET.