The Nigerian Federal Government has signed multiple agreements with various companies for the Calabar power plant which will add more than 500 megawatts (MW) to the National Grid.
The agreements were signed Thursday with the World Bank, Niger Delta Power Holding Company (NDPHC), Nigerian Bulk Electricity Trading (NBET) and the gas supplier, Seven Energy, an integrated gas company in Nigeria, which is investing about US$500 million USD dollars in the construction of gas processing facility at the Uquo Field in Akwa Ibom State in southern Nigeria.
An agreement for a Partial Risk Guarantee (PRG) between NDPHC and the World Bank was signed to secure the supply of about 130 million cubic feet per day of gas to the NIPP Calabar Plant by Seven Energy.
A Gas Supply Agreement was signed between NDPHC and Seven Energy with legal obligations on the gas supplier to deliver gas to the power plant in Calabar. The agreement is expected to come info force within 90 days.
Nigerian Vice-President Professor Yemi Osinbajo, said at the signing ceremony that the development would open up new opportunities for investments in Nigeria's gas and power sectors.
He noted that the arrangement was the first of its kind for gas supply in Nigeria and a demonstration of the Federal Government's commitment to increasing power supply in the country.
"it will encourage investment in the gas infrastructure and we are certainly looking forward to the multiplier effects that will come from this. This is a very significant event for us and as we all know this is the first PRG for gas that we are signing," he added.
"Given the current power situation, we expect that this gas that will go into the Calabar plant will provide about 500 MW of power which is very significant given our current situation."
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