Babalola gave the management of the power company a marching order on gas supply with a view to boosting electricity supply to Nigerians.
The workers union of the power company, National Union of Electricity Employee would however not allow the minister’s stinker to settle as they said the development is a mere campaign of calumny and attempt to make PHCN management a scapegoat.
The brewing battle of words between the minister and PHCN workers is coming on the heels of the drastic drop in the nation’s generation capacity. And it will only add to the tall but unending tales of woes of the nation’s inability to meet the 600mw target by the end of last year.
INDUSTRIAL SECTOR AT RECEIVING END
The industrial sector of the country has suffered in recent times as companies had continued to relocate elsewhere due to epileptic power supply and other inrastructural problems.
For instance, in the past 11years, it has been estimated that over 800 companies in the country have closed shop.
Besides, Nigeria heavily relies on gas to power thermal stations in the country. This gas is however in short supply, thereby plunging the country into darkness. At a time, it was alleged that the shortage of gas was being caused by indebtedness of PHCN to the Nigerian Gas Company as well as the crisis in the Niger Delta.
It was estimated that 1.2billion standard cubic feet of gas was required to power the thermal stations in order to meet the 600MW target but the country could not even get half of the gas requirement.
Managing Director of PHCN, Engr, Hussein Labo listed six thermal power stations that are inoperative as a result of lack of gas to drive the machines for electricity generation.
These plants are Egbin thermal station with capacity of 1000Mw but forced down to 400MW. Sapele is with all its units intact but produces nothing due to lack of gas. Other powerstations with same problem include, Delta, Geregu, Omotosho and Olorunsogo whose output have been grossly limited with inoperative capacity of 100MW,130MW,225MW and 300MW respectively as a result of non availability of natural gas. In December last year, out of 945million standard cubic feet of gas (Mscf/d) planned for PHCN power stations, only 425.25mscf/d was supplied which translated to 3, 780MW and 1,701MW of electricity to the national grid.
Available statistics from the oil and gas sector also indicated that out of the 380mscf per day expected last month from gas suppliers, the actual volume that got to power stations was about 180mscf/d.
With the above scenario, it is evident that Babalola would have to gird his loin otherwise his new boss, the Acting President Dr.Goodluck Jonathan, who is keen on improving power supply, might soon blacklist him. His saving grace would come only when he keeps PHCN workers on their toes.
THE FLASHPOINT
The minister, who summoned top management of PHCN to a meeting in his office directed them to accelerate and conclude discussions on Gas Supply and Purchase Agreement (GSPA) and Gas Transportation Agreement (GTA) with the Nigerian National Petroleum Corporation (NNPC) in a renewed effort to guarantee supply of gas to the thermal power stations.
According to him, PHCN as an operator should be concerned about the declining generation as a result of gas challenges and find a quick solution to the problem. He added that the country currently has over 5,000MW generation capacity but lamented that the lack of gas to drive generation machines has continued to draw the sector backwards.
“You have to accelerate and conclude the on-going discussion with NNPC on gas issue and sign the agreement immediately and also finalise the framework for back-up fuel agreement based on LPFO and LPG for other power stations apart from Egbin in order for us to resolve this gas challenges. We cannot continue to fold our arms and wait for manna to fall from heaven,” he was quoted as saying. He further directed the PHCN to come up with a plan that could be implemented immediately on the alternative source of fuel such as Low Pour Fuel Oil (LPFO and Liquefied Petroleum Gas (LPG) to drive the power stations that are currently dysfunctional.
He explained that while issues surrounding availability of gas are being tackled, management of PHCN should look at all the generating stations and assess the units that can be modified to use other forms of fuel such LPFO or LPG as a stop gap measure instead of completely looking helpless in the absence of gas from the NNPC and the gas producers.
According to him, concluding and signing of gas purchase agreement with the NNPC will help to secure commitment to its delivery. He pointed out that such a pact will help all parties to keep to terms and conditions of sale and purchase agreement, arguing that the penalty clause in such circumstances will allow all the parties to be aware of their obligations to the pact.
He explained further that with the GSPA in place, it will engender confidence between gas producers and NNPC, as well as reminding PHCN and the generation companies to keep to all the terms including payment for gas supply, stressing that the Nigerian Electricity Regulatory Commission(NERC) with the support of the World bank has provided the framework in the GSPA and Purchase Agreement (PPA) to be able to make operators accountable for their operations.
Babalola revealed that contractors handling the repair works at the Delta power station will conclude the rehabilitation of two generating units which will increase Delta’s capacity by an additional 200MW. This in effect will increase Delta’s capacity to 520MW. Gas limitations, however, have restricted its present generation to about 150MW.
HORSE TRADING
But the National Union of Electricity Employee expressed disappointment over the minister’s so-called marching order on gas supply. President of the union, Joe Ajero said such a position was an attempt by the minister to make PHCN management a scapegoat, adding that the minister ordinarily, would have given directives in-house.
He said it is unheard of for the minister to urge PHCN to check gas supply crisis when the onus lies on him to effectively dialogue and resolve the issue at the inter-ministerial level between him and petroleum minister; and thereafter give directives on implementation of agreements.
According to him, the members of staff of PHCN and the National Union of Electricity Employees feel greatly embarrassed at the buck passing attitude of the minister who should be remorseful for his inability to deliver the much touted 6,000 megawatts as at 31, December, 2009.
“It is unfortunate that the minister who ought to have been better informed on gas availability and affordability in PHCN through his constant link Rilwanu Lukman – the Petroleum Minister appears to be ignorant. More worrisome is the fact that this is happening at a time the Acting President is vigorously scratching his brains on how to tackle the power crisis head-on. For emphasis, the staff of PHCN and Nigerians are tired of flimsy excuses for the inability to provide power for the comfort and socio-economic growth of the nation.
“We cannot continue to groan under these circumstances when enough political and economic energy should have been summoned to see us through this electric power problem.
“Apart from the gas crisis bedeviling us, the Union had suggested for alternative source of power generation which the authorities have continuously ignored. PHCN should not be made a scapegoat when policies, action or inaction of the authorities are not circumspect and therefore always incoherent.
“It should be borne in mind that PHCN has very highly qualified and hard working staff that can cope with the power challenges if the authorities are willing to provide the template. The minister should not abdicate his responsibilities.’’
Stakeholders in the industry however posit that given the power situation in the country, the amount of time the two parties would spend exchanging words should be devoted to harmonizing positions with a view to finding lasting solution to the power crisis.
ENERGY EXPERT SUPPORTS BABALOLA
An energy expert, Toye Edun said what the minister said was not bad after all.
“What the Minister said was not a new thing. It was something that has been commonplace .It is a wake up call on the staff of the power company to do their work and strive to bring joy and happiness to Nigerians, whose faces have been grim as a result of power failure. Obviously, I do not see any problem in what the minister said.
‘But there should be a caveat here. Instead of this disagreement, the two parties should channel their energy towards finding a constructive solution to the power crisis. The nation cannot continue with this messy power situation and expect to be among the best 100 economies in the world by the year 2020,’’Edun said.
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