Egbin power plant owe banks N99bn

The Managing Director and Chief Executive Officer, Egbin Power Plc, the nation’s biggest power station, Mr. Dallas Peavey Jr., has said the company owes banks $325m (N99.13bn).

Egbin, which is located in Lagos, was acquired in 2013 by Kepco Energy Resource Limited in collaboration with its technical partner, Korea Electric Power Corporation, during the privatisation of the successor companies carved out of the defunct Power Holding Company of Nigeria.

Peavey said the plant was currently generating about 425MW, with about 820MW capacity left idle due to gas constraint.

He put the debt owed the company by the Federal Government at N86bn.

“Normal generation in Egbin is about 1,320 megawatts. Currently, we are doing about 425MW, only 30 per cent of what we should be generating simply because of gas,” he said on the sidelines of the company’s 2016 scholarship award ceremony for students in Ijede Town, Ikorodu.

Peavey said, “The Transmission Company of Nigeria cannot take the full amount of power that we can generate. Right now, the biggest issue is gas.

“On top of that, we are owed over N86bn by the Federal Government; we have been producing but we haven’t been paid for almost six months. The last amount of money that we got was about 16 per cent of the total bill for the power that we generated for the month.”

Noting that the scarcity of dollar had continued to take a toll on the company’s operations, Peavey said, “But we, as a private company, have continued to dig deep into our pocket, go to our sister and parent companies to borrow money that the banks can’t loan us to continue to operate. But even so, if we don’t get paid and if we don’t get gas, we can’t continue to generate.”

Asked about the company’s indebtedness to banks, he said, “Right now, it is about $325m; how do you continue to sustain that? You can’t pay the principal, so how can you pay the interest? It is a difficult situation.

“We had to continue to borrow money to do the repairs, to buy the materials for the replacement of pumps, modules and transformers.  We continued to overhaul each one of the six units.”

Peavey said, “The nation needs over 10,000MW today; so what we need to do is to continue to work with our owners and partners so that we can get fuel, and then work with the TCN so that it can take the power and get it to the nation. Right now, we have got almost 820MW stranded capacity that the nation needs.

 

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