Black Rhino intends to invest $1.1 billion on Qua Iboe Power Plant and ExxonMobil would invest $500 million on gas project in Akwa Ibom State, Southern part of Nigeria.
This followed Federal Government’s approval of $1.1billion Power Purchase Agreement, PPA, negotiated by the Nigerian Bulk Electricity Trading Plc (NBET) on October 27, last year with new investors for the siting of Qua Iboe Power Plant in Akwa Ibom.
To further give a stamp of authority to the project, Akwa Ibom government and Black Rhino signed a Memorandum of Understanding, MoU, for the establishment of a transmission line and a power plant in the state on Tuesday at Government House, Uyo.
Udom Emmanuel signed for Akwa Ibom State government while Brian Herlihy penned for Black Rhino, operators of Qua Iboe Power Plant, QIPP. QIPP is jointly owned by the NNPC, Black Rhino Group and Dangote Group.
Emmanuel said commended the QIPP management for committing an investment of 1.1 billion dollars for the facility with an additional 500 million dollars for gas.
“We want to believe the gas reserves we have here can actually make Akwa Ibom a gas hub and we can actually partner, we can collaborate to see how we can realise this.
“Nigerians cannot have this quantum of gas and we still face a whole lot of challenges of what gas can solve. It is inexplicable but that is the situation we found ourselves,” he said.
He said the signing of the MoU is one of the solutions that will solve the country’s gas challenges, maintaining that he was fulfilling his initial promise to involve his government actively in the process.
The governor assured “We will make sure you have the cooperation of the communities, the government and all the agencies that need to make your job easier.”
He said the current electricity generated in the country was a far cry from the demands, and reiterated the confidence and expectations of Nigerians on the new power project.
“I’m sure we should be able to use this to launch into the new direction that will actually take us to where we are going to.”
Brian Herlihy, the Chief Executive Officer and founder of Black Rhino, described the project as the beginning of “not only a power project but a huge industrialization programme and we thank you for your leadership.’’
He thanked the state government’s team for the measure of hard work exhibited, and assured that his team looked “at Akwa Ibom State as the best place to be in Nigeria where things are actually happening.”
Herlihy lauded the hospitality and the excitement observed in the state and announced that, “we are gonna invest 1.1 billion dollars for this Power Plant and Exxon is gonna invest another 500 million dollars for the gas.”
Recall that in addition to approval of PPA, the Federal government also approved a Put/Call Option Agreement (PCOA), which NBET and the Ministry of Finance agreed with the project’s investors – the Qua Iboe Power Plant Limited (QIPP).
Speaking during the signing of the PPA, Mr. Babatunde Fashola, the Minister of Power, Works and Housing, said its closure was in line with the desire of the federal government to consistently grow Nigeria’s ability to provide stable electricity to its 180 million citizens, about 50 per cent of who are yet to be connected to the national grid.
NBET and QIPP also stated at the PPA signing ceremony in Abuja that work on the project which is expected to cost about $1.1 billion, would commence as soon as a financial closure is achieved within the second quarter of 2018.
The Chairman of Black Rhino and Emir of Kano, Muhammad Sanusi II, said the conclusion of the PPA and PCOA processes would give promoters of the project the confidence to accelerate their Final Investment Decision (FID).
However, Mobil Producing Nigeria Unlimited (MPN), a subsidiary of ExxonMobil, after reaching commercial terms with Qua Iboe Power Plant Limited (QIPPL), transferred the ownership of the project and the supply of gas from the Nigerian National Petroleum Corporation (NNPC)/MPN joint venture off-shore facilities to Black Rhino.
Black Stone Group and Dangote Group are subsidiaries of Black Rhino.
At the formal transfer of the project to Black Rhino on October 30, last year, Muhammed Sanusi II and Mr. Paul Arinze, General Manager, Public & Government Affairs of Mobil Producing Nigeria Unlimited witnessed for their companies.