FEC okays release of N8.64b counterpart fund for Siemens electricity deal

July 29, 2020

The Federal Executive Council (FEC) on Wednesday ratified the President’s anticipatory approval for the release of N8,648,081,465.2 towards the counterpart funding for the power deal with Siemens AG, signed by the Nigerian and German governments.

The amount is made up of €15.21 million (N6,940,081,465.20) and N1.708 billion onshore components.

Briefing State House correspondents after the 10th virtual meeting of the council presided over by President Muhammadu Buhari, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said that the memo seeking the ratification was jointly presented with her Power ministry counterpart, Saleh Mamma.

She explained that the money is for the counterpart funding for the bilateral credit facility from German Consortium guaranteed by the German government through Euler Hermes to finance the implementation of the end to end grid modernization and expansion programme of the project.

Ahmed said the amount is for the first phase of the three-phase project designed to include 23 transmission initiatives as well as 175 separate transformative projects.

She said: “So today at the council, we discussed stage one of phase one of this project under presidential power initiative. This project is designed to include 23 transmission initiatives as well as 175 separate transformative projects in the electricity distribution franchises that we have in the country

“The project will also support the regulator, Nigerian Electricity Regulatory Commission (NERC), to transition towards a programme of improving metering in the electricity industry in the country

“Let me remind us as citizens that Mr President and his German counterpart met in Abuja in 31st August 2018 and committed to jointly increase the capacity of the Nigerian electricity grid from the current capacity of 5,000 megawatts to 25,000 megawatts over a three-phased Programme

“After this meeting, an MOU was executed on the 23rd of July, 2019 between the Nigerian Government and the Siemens AG with the German Government support

“The MOU is designed to deliver this end to end modernization programme which we are calling the presidential power initiative. The objective of this presidential power initiative is to address the intractable problems that have bedevilled the Nigerian power industry, over a period of years

“The project will be implemented in three phases and the subject of our memo today is phase one

“The facility for this programme is to be sourced from the German consortium and it would be guaranteed by the German government through Euler Hermes covering 85 per cent of the project cost, the highly concessional facility with two to three years moratorium, 12 years loan repayment period with an interest rate of LIBOR plus one per cent to LIBOR plus 1.2 per cent. And also the Federal Government is to provide 15 per cent counterpart funding as its contribution towards the project

“We have a provision in the 2020 appropriation revised for the government’s counterpart funding

“The federal government is taking the loan from the German government with the plan to on-lend this particular loan to the distributing network. So, it’s a convertible loan facility to the DISCOs and we will be working with the DISCOs to restructure an appropriate loan agreement as soon as we are able to close out on this initial phase of the process. And the council approved and ratified Mr President’s approval.”

The Federal Government had in December 2019, allocated N61 billion for the Nigeria Electrification Road map which will be developed in partnership with Siemens AG.

In July 2019, the government and Siemens signed a Letter of Agreement on the Nigeria Electrification Road map after President Buhari and the German Chancellor, Angela Merkel met on August 31, 2018, in Abuja.

Nigeria is expected to spend about €3.11 billion or N1.15 trillion across four major states. The Nigerian electrification project has three phases and it aims at achieving 25,000 megawatts of electricity in the country by 2025.

Power projects in the budget include the 3,050-megawatts Mambilla hydropower plant in Taraba State, for which N2 billion counterpart-fund was set aside. Others are 2x60MVA 132/33kV substation at Gwaram in Jigawa State (N717 million); 215MW power station in Kaduna (N190m); and Kashambilla transmission in Taraba (N506 million).

ALSO READ: Bauchi First Lady distributes food supplements to pregnant women, children

FEC also approved the ratification of Air transport agreement between Nigeria and the United States of America, USA.

The Minister of Information and Culture, Alhaji Lai Mohammed, who disclosed this to correspondents, explained that air transport bilateral agreement is to strengthen economic, social and cultural ties between the two countries.

Mohammed, who stood in for the Minister of Aviation, Senator Hadi Sirika, said: “The Aviation Minister presented a memo today (Wednesday) on the approval for ratification of the air transport agreement between the Federal Government of Nigeria and the United States of America.

“The minister sought the council’s approval for ratification of the air transport agreement between USA and Nigeria

“You will recall that both the United States and Nigeria are parties to the Chicago Convention on the 7th of December, 1994. Article 6 of the convention actually urges parties to sign air services agreement with member states to improve social, political and economic ties.

“The US has ratified its own and Mr President and council graciously accepted today to also ratify this agreement. So, today, Mr President signed valid agreement of Air transport service between Nigeria and the US with the attendant benefits for both countries, especially as Nigeria is working towards having its own full national airline.

“So, we will now take advantage of this air transport bilateral agreement to strengthen economic, social and cultural ties between the two countries.”

The council also approved a memo urging President Buhari to ratify the Investment Promotion and Protection Agreement aimed at granting more protection to Nigerian investors.

This comes as the Federal Government in the revised National Forest Policy has suspended exploitation of charcoal in the country.

The Minister of Industry, Trade and Investment, Niyi Adebayo, in his remarks at the briefing. explained that the Investment Promotion and Protection Agreement will protect Nigerian investors when they invest abroad and to give Nigeria more protection when other investors come into the country.

Adebayo said, “The Ministry of Industry, Trade and Investment presented a memo to Council today, seeking Council’s approval for Mr President to ratify the Investment Promotion and Protection Agreement, which we signed in 2016 between Nigeria and Singapore on the one hand, and Nigeria and the Kingdom of Morocco on the other hand.

“In 2016, the Attorney-General of the Federation came up with a new model of Investment Promotion and Protection Agreement and that year Nigeria signed based on that new model between Nigeria and Morocco, and Nigeria and Singapore.

“The whole idea was to grant more protection to Nigerian investors when they invest abroad and to give Nigeria more protection when other investors come into Nigeria.

“Basically, those were what we were in FEC for and the Council graciously approved that Mr President should ratify and the Attorney-General will present to Mr President for his ratification and the agreement will come into effect thereafter.”

Also briefing, the Minister of Environment, Mohammed Mahmoud said that the council approved a new National Forest Policy to protect the nation’s forest and to create more jobs.

He said, “The new National Forest Policy is a revised policy. The old one was formulated in 2006. Why a new one? We realized that the old one is not catering to the current situation at hand. Forestry is a big sector of the economy. It provides a lot of employment opportunities, reduces poverty, provides means of livelihood and foreign exchange from the export of wood

“Without sustainable forest management, you cannot have all of these benefits

“We also know that right now particularly with the issue of climate change, the forest is a big part of climate change mitigation. The more forest we have, the more cover we seek. It means taking the emission out of our planet and stabilizing the temperature of the planet and the catastrophic effects of climate change

“So, we have revised it and produced a new one. And we believe this will go a long way in regenerating employment which is an issue at hand. Youth and women are vulnerable in rural areas; they usually bear the brunt of this issue of deforestation. The more we populate our forest with trees, the better for the people not just in the rural areas but even the economy

“Currently, we have suspended the export of forest products because we do not have enough control under the old policy. So, we have suspended that. Charcoal exploitation has been banned completely. These are some of the things that are causing degradation of our land

“When you lose the forest, it’s not just forest that you are losing; you are also losing the land because the land will be eroded. It may not support agriculture, thereby foodstuff becomes very expensive. The people around that forest area become unemployed. Poverty will increase in the long-run

“This is a policy that we feel will go a long way in safeguarding the economy and the planet at the same time, both human capital, and physical environment. It’s a collaboration between the federal government, state government, local government, non-governmental organization, CBOs, the private sector, and international organizations. This is something that all hands must be on deck.”

He said that tree planting campaign has already started unofficially with millions of trees being planted, adding, “But we will be seeking the President’s indulgence to flag off symbolically, national tree planting this year. We expect in one day everybody will plant at least one tree.”

The Minister further said that national tree planting should be something perpetual that should no longer be a yearly or monthly thing.

“This is basically what forest policy that we have just presented is all about. We have it approved today. We thank Mr President and the council for approving the policy.”


THE House of Representatives on Tuesday raised the alarm over lethal clauses in Article 8(1) of the commercial loan agreement signed between Nigeria and Export-Import Bank of China, which allegedly waives “the sovereignty of  Nigeria”  in the $400 million loans for the Nigeria National Information and… Read Full Story
Nigeria Centre for Disease Control (NCDC) has again warned against the casual use of hydroxychloroquine as the cure for COVID-19. In a series of tweets on its official handle, @NCDCgov, the centre maintained that the use of hydroxychloroquine in Nigeria was limited to clinical trials… Read Full Story
JUSTICE Suleman Belgore of the High Court of the Federal Capital Territory (FCT) on Monday issued a warrant of immediate arrest against the immediate past clerk of the National Assembly, Alhaji Mohammed Sani Omolori. The judge issued the warrant of arrest following an ex parte application filed by the EFCC… Read Full Story
The Federal Government has declared Thursday 30 and Friday 31 July, as public holidays to mark 2020 year’s Eid-el-Kabir. The Minister of Interior, Ogbeni Rauf Aregbesola, made the declaration on behalf of the Federal Government, through a statement signed by the Permanent Secretary, Ministry of Interior… Read Full Story
The Ondo State governor and the candidate of the All Progressives Congress (APC) in the forthcoming governorship election in the state, Mr Rotimi Akeredolu, has named Mr Lucky Ayedatiwa as his running … Read Full Story
Osun State government, on Tuesday, announced that it has cancelled Eid prayers for this year’s Eid-el-Kabir celebration. In a release signed by the Secretary to the State Government (SSG), Prince Wole Oyebamiji, the government stated that; “having appraised how the state is currently faring with respect to the global… Read Full Story
The Court of Appeal, Abuja Division, on Tuesday, struck out the appeal brought before it by former Senator Dino Melaye challenging the judgment of the Kogi State National Assembly Election Petition Tribunal which affirmed the election of Senator Smart Adeyemi as the Senator representing  Kogi West Senatorial… Read Full Story
What happens is this-Nigerian kind of politics is one that is created. You know there are different motives for different things. It is election time now and I begin to brag my own truth or story about politics, about who I am and who I am not. Today, in Edo, this is what is on ground – Edo is dearly a PDP state… Read Full Story
I am a very local person and it is a deliberate choice. I was born in Benin; I went to primary school in Benin; I went to secondary school in Benin; I went to the university in Benin. Unfortunately, there was no Law school in Benin. If not I would have preferred done law school in Benin. That’s when I had to come to Lagos,… Read Full Story
TODAY, it is common, especially on social media, to see people calling themselves advocates and jumping on diverse causes without adequate information or knowledge about the subject of the cause especially when it comes to gender issues like rape, gender equality, harassment, intimate relationships and boss-employee… Read Full Story
LAST weekend, bandits alleged to be Fulani herdsmen struck in the southern part of Kaduna State, cutting down scores of people. Like many other Nigerians, popular Nigerian musician, Joel Amadi, lost loved ones: his father and uncle were among the scores killed. Since January, the killings in Southern Kaduna… Read Full Story
Lagos State governor, Mr Babajide Sanwo-Olu, on Tuesday, vowed that his administration places a high premium on compliance to due process, probity and accountability in the management of… Read Full Story
Data analysis from the Nigerian National Petroleum Corporation (NNPC) has shown that the volume of natural gas produced from the nation’s deepwater oil fields has hit its lowest level in… Read Full Story

You may be interested

Edo Decides: Happening in Estako West, Oshiomhole, Shaibu, Audu’s LGA [VIDEO]

Edo Decides: Happening in Estako West, Oshiomhole, Shaibu, Audu’s LGA [VIDEO]

admin - September 19, 2020

This is the current situation of things in Estako West Local Government Area where Adams Oshiomole, the former National Chairman…


FG announces N75bn support for 1.7 million Nigerians, businesses from Sept 21

admin - September 19, 2020

Mariam Katagum, Minister of State for Industry, Trade and Investment, has confirmed that the federal government will provide financial support…

Edo 2020: Police lay siege on Wike, other Governors in Benin

Edo 2020: Police lay siege on Wike, other Governors in Benin

admin - September 19, 2020

<!-- Edo 2020: Police lay siege on Wike, other Governors in Benin - ElombahNews HomePoliticsEdo 2020: Police lay siege on…

Leave a Comment

Your email address will not be published.