The Joint Senate Committee on Gas and Power, Steel Development and Metallurgy have ordered the suspension of the planned commissioning of the 215 Megawatts Kaduna Power Plant over inconsistencies in the contract implementation.
The plant which is expected to be commissioned in January 2018, will be powered by diesel worth N16,790,000,000 yearly.
The Joint Committee gave the order on Monday, following an investigative hearing on the “Urgent need to save the 215 MW Kaduna Power Plant.”
The power plant, which was inaugurated in 2009 is already three years behind the scheduled commissioning.
The lawmakers said they were unimpressed by the reasons given by the Permanent Secretary of the Ministry of Power, Louis Edozie who defended the change of the parameters of the Plant from a gas-powered plant to diesel-powered plant.
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Representatives of the Power Ministry led by the Permanent Secretary had told the Committee that the Ministry plans to commission one of the eight units in the plant in January 2018 and that the unit would run on diesel.
The diesel-powered plant is expected to cost the country N46 million per day.
The lawmakers were however alarmed to hear that the cost would be far cheaper if the plant is to run on gas.
Chairman of Greenville LNG, Eddy Van Den Broeke, who led his team to address the Committee, said that the company had a Memorandum of Understanding with the Kaduna Gas Plant to build storage facilities for the plant at no cost.
He also stated that while the plant would produce a kilowatt of electricity at N79 if run on diesel, it will produce the same kilowatt of power at N37.
He said that his company had, as a result of the MoU it signed with the Power Plant, invested the sum of $400 million on its gas plant in Roumuji, Port Harcourt.
He said: “In 2014 when the parameters were signed it was agreed that LNG is most competitive. We have invested $400million after which people in the Ministry decided to change the parameters.
“It will cost $200 million more to use diesel because there is no other fuel available that can replace LNG and Greenville. I would want the Ministry to give me one cent of response on this change of theory.”
He said that apart from the functional Gas Plant, Greenville already imported 250 trucks meant to evacuate gas to the power plant before the change of parameters by the Ministry.
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The Committee was told that the Ministry decided to change the parameters of the Plant from Gas, which was the original design to diesel, will eventually jerk up the cost of power at the plant.
Co-Chairman of the Joint Committee, Albert Bassey told the Permanent Secretary to inform the Minister of Power, Works and Housing that the Senate has put a stop at the planned commissioning.
“I feel very disappointed. Please tell your Minister to stop the process of Commissioning because the project cannot be ready even by mid next year.
“We are insisting that it will be cheaper to run the plant with gas, which is environmentally friendly. Let your Minister know we cannot be taken for granted,” the lawmaker told the Permanent Secretary.
Chairman of Committee on Power, who is also a Co-Chairman, Enyinnaya Abaribe also decried the decision of the Ministry to change the parameters of the plant from cheaper gas to diesel, which is largely imported.
He said that the Ministry should put the planned commissioning on hold to enable the Committee to embark on further physical examination of the plant.
He said: “We have heard a lot of disturbing things and we have all seen that we have put the cart before the horse. Everyone in this hall today has now seen why we ask questions. We ask questions when things don’t seem to be going the right way.
“You see one price at N79 and the other at N35, why do you go for the higher cost which is not cost-effective. If you are going to spend N46 million daily to run a plant and you said it is temporary, that is not effective. If you start one plant and the rest don’t come up in eight years, we need to save this project from becoming another white elephant project.”
OWEDE AGBAJILEKE, Abuja
