Revealing a significant development, Minister of Power, Adebayo Adelabu, shared that the Federal Government will commence payments towards the debts owed to power generating companies and gas suppliers starting in April.
During a recent visit to Egbin Power Plc in Lagos State, Adelabu mentioned plans to collaborate with the Central Bank of Nigeria to prioritize foreign exchange allocation to enhance the power sector’s capacity for generating output.
In discussions about the debts within the power sector, Adelabu mentioned seeking understanding from GenCo stakeholders during his visit to Egbin.
He emphasized the importance of addressing the owed debts to ensure the uninterrupted operation of power assets like Egbin Power plant. Adelabu assured that the government would initiate debt payments from April as an incentive to maintain operational continuity.
Addressing the gas shortage challenge, Adelabu mentioned ongoing discussions with the Minister of State for Petroleum Resources regarding debt repayment to gas suppliers, along with plans for cash injections and promissory notes.
CEO of Egbin Power, Mokhtar Bounour, highlighted the revenue loss due to gas shortages, impacting national power generation. He expressed concerns over running the plant below capacity due to insufficient gas supply.
Bounour mentioned the challenges faced by the plant during a closed-door meeting and expressed optimism that gradual solutions would lead to improvements in the near future.
Emphasizing the critical need for adequate gas supply, Bounour stressed the investments required to sustain efficient plant operation, detailing the impact of insufficient gas allocation on generating capacity.
Additionally, Bounour mentioned the significant debt owed to GenCos by the Federal Government, pointing out the liquidity issues faced and expressing hope for imminent solutions to sustain business operations.
In an earlier statement in February, Adelabu had mentioned the substantial debts owed to gas companies by the Federal Government, underscoring the magnitude of the financial commitments involved.