24/7 POWER SUPPLY (1000 MW)
FG: $1BN, 450MW AZURA IPP, A PATH-BREAKER FOR POWER SECTOR
14 Oct 2014
President Goodluck Jonathan
Chineme Okafor in Abuja
President Goodluck Jonathan has described the use of “project finance” option for the development of the $1 billion, 450 megawatts (MW) Azura/Edo open cycle gas turbine Independent Power Plant (IPP) as a path-breaker in Nigeria’s electricity industry.
Jonathan stated this last Friday when he performed the groundbreaking for the construction of the plant at the Ihovbor/Orior Osemwende communities in Edo State. He said the closure of all necessary arrangements for the construction of the plant was an indication that the government’s liberalization of Nigeria’s power sector was not amiss.
He noted that the option of “project finance” framework in funding the Greenfield IPP represents a new opportunity for Nigeria’s power sector.
The financing framework, he added, will open up the sector for more private sector led investments which the government is willing to embrace in its power liberalization policy.
Azura IPP is the first of a new wave of “project financed” power projects in Nigeria. What this means is that it is the first IPP to be privately funded without the use of a corporate balance sheet to support the raising of funds required to execute it but rather non-recourse loans which will be secured by the project assets and repaid entirely from the cash flow of the power plant when operational and not from the general assets or creditworthiness of its sponsors.
Jonathan stated that the project shows that the government has set a sustainable path for Nigeria’s electricity industry to grow with the private sector firmly involved.
He also noted that such path would be pursued by government to develop other aspects of the country’s electricity industry, especially generation through various fuel sources.
“We are committed to irreversibly repositioning the Nigerian power sector as a pivot for the attainment of the nation’s developmental targets.
We are also maintaining our policy push for increased diversification of our energy, expanding investments in large hydro power projects through public-private partnerships, and the provision of necessary support to accelerate the exploitation of our coal resources.
The federal government will continue to ensure that the growth of the electricity industry becomes self-sustaining and sustainable. My administration is fully committed to continuously improving the framework and enabling environment based on sound policy formulation, access to long-term low interest finance, and transparent and consistent regulatory guidelines,” Jonathan said.
On the role of the Nigerian Bulk Electricity Trading Plc (NBET) in the project, he said the protocols established by NBET in developing a model Power Purchase Agreement (PPA) for the IPP such that it is able to shore up credit enhancements provided through the Federal Ministry of Finance will ease investors’ consideration of the “project finance” option in investing in the sector.
“Nigerians can be assured that we are on the right path to providing our businesses and homes, in both rural and urban areas, adequate electricity to drive the critical development of our nation,” he noted.
Co-Managing Director of Azura, David Ladipo also said that irrespective of the modest input of the 450MW plant in Nigeria’s power generation profile, the “project finance” option stands to benefit the country in building up its infrastructure using the model.
The Azura-Edo project, which is on track to achieve full financial close by November 2014 is being developed by a consortium of local and international investors led by Amaya Capital Limited and American Capital Energy and Infrastructure.
It comprises a 450MW open cycle gas turbine power station; a short transmission line connecting the power plant to a local substation and a short underground gas pipeline connecting the power plant to the country’s main gas-supply. It also represents the first phase of a 1,500MW power plant facility to be built on the same site.
Its funding involves equity and debt from a consortium of local and international financiers. The project also incorporates an additional investment being made by Seplat Petroleum Development Company Plc in new gas processing facilities at its Oben gas plant.
The gas project will as part of Seplat’s joint venture with the Nigerian Petroleum Development Company (NPDC) supply the plant with fuel gas requirements.
Siemens and Julius Berger Nigeria were selected as the project’s Engineering, Procurement and Construction (EPC) contractors, while an Operations & Maintenance (O&M) contract is in place with the PIC Group, a subsidiary of Marubeni.
Being the first Nigerian power project to benefit from the World Bank’s ‘Partial Risk Guarantee’structure, specifically created to meet the developing needs of emerging markets world-wide and political risk insurance for equity and commercial debt from the MIGA, also part of the World Bank group, the project’s overall transaction will be underpinned by financial support provided by the federal government through a Put and Call Option Agreement agreed by the Coordinating Minister for the Economy and Minister of Finance Dr Ngozi Okonjo-Iweala.
The arrangement will also complement the PPA that was signed in 2013 between Azura and NBET Plc. The model PPA for Azura was tightly developed with a team from NBET; it is reported that accompanying risks were apportioned equally in the PPA.
Its promoters explained that locating the plant on the outskirts of Benin City gives it the advantage of close proximity to Nigeria’s biggest gas distribution pipeline which makes gas feedstock easily available as well as a unique accessibility to the country’s high voltage transmission network to facilitate the evacuation and distribution of power.
Ihovbor Power Plant
Ihovbor Power Plant
Operating Company: Benin Generation Company Limited
Location: Benin city, Edo State
EPC Contractor: Maurbeni Engineering West Africa Limited
Configuration: Four Gas Turbines (GE Frame 9E Gas Turbines)
Capacity: 507.6 MW (ISO) and 451MW (Net)
Details: The Plant is an open cycle gas turbine power plant built to accomodate future conversion to combined cycle gas turbine (CCGT) configuration
Project management Structure
History and Origins
The Niger Delta Power, NDPHC began its journey in 2004 as The National Integrated Power Project (NIPP). It was conceived as a fast-track government funded initiative to stabilize Nigeria’s electricity supply system while the private-sector-led structure of the Electric Power Sector Reform Act (EPSRA) of 2005 took effect.
NOTE: this is a project that they claim is a major breakthrough for a country that produces only a meager 4,000 megawatts of epileptic power supply for an “over inflated’ population of 160 million (for the purpose of receiving more state allocation funds for the northern states) while Iran a much less populated country produces about 70,000 megawatts which is almost 20 times more than we produce.
SHAME ON THEM!!!
Because when (not if) we win our international litigation and have full access to our oil blocs and the funds & financial in the billions of dollars accruable to our oil communities we will ensure that in that same year we will install our own Edo Delta Gas Turbine IPP that will produce at least 1000 megawatts of power at the cost of about $500 million; which is a quarter of the 4000 megawatts that Nigeria is currently producing and it will be temporarily be sufficient to power both Edo and Delta States 24/7 & 365 days of the year without blinking for a second for more or less half the super inflated cost of the Azura IPP quoted at $1 billion that will produce half the power of 450 megawatts. After which we keep increasing it in phases to pave way for power requirements of our industrial growth to glory and greatest with or without the support of the federal government.
Please read below the Gas Turbine Power working module from the same Siemens company adapted by the Thailand government we aim to more or less copy & paste in Edo & Delta States to rapidly boost our power supply.
SIEMENS DELIVERS OVER 1000 MW OF GAS TURBINE
POWER TO THAILAND
November 13, 2013
By PennEnergy Editorial Staff
Siemens Energy has received orders for a total of 20 SGT-800 industrial gas turbines from Thailand. The turbines will be used in various natural gas-fueled combined cycle cogeneration power plants within Thailand. The contract is part of the Thai government’s program to support small power producers. The end customers are the Thai independent power producers Amata B.Grimm Power Limited (ABP), which ordered 10 turbines, SSUT Co. Ltd. & PPTC Co. Ltd. (six turbines), and IRPC Clean Power Co. Ltd. (four turbines). Each of the units sold has a capacity of 50.5 megawatts (MW), so the combined total capacity of the 20 gas turbines is over 1,000 MW. Siemens delivers also five industrial steam turbines of type SST-400 for the customer ABP. Including installation and commissioning, the order value for Siemens is over €300 million.
“Siemens already obtained orders in 2010 and 2011 for 20 industrial gas turbines from Thailand. Since that time, 18 of these turbines have already gone into commercial operation,” said Thierry Toupin, CEO of the Business Unit Gas Turbines/Generators at Siemens Energy. “All of these turbines were able to meet or even exceed the contractually promised values in terms of capacity and efficiency. This success was a decisive factor in the Thai small power producers opting once again for Siemens’ SGT-800 gas turbines.”
“With the Siemens SGT-800 gas turbines, we are able to generate electricity very efficiently, allowing us to decrease our fuel consumption,” explained Khun Preeyanart Soontornwata, President of ABP. “As a result, we can reduce our costs per kilowatt-hour generated.”
The 20 Siemens SGT-800 industrial gas turbines will be used in ten different plants located in industrial parks. Most of the power plants are located within an approximately 200-kilometer radius of Bangkok, Thailand’s capital. For some of the gas turbines, Siemens will also be delivering chiller coils to enable approximately 10 MWel greater power plant output. All of the 20 units are being manufactured at the Siemens plant in Finspong, Sweden.
The order is part of the third phase of the Thai government’s program to support small-scale electricity producers. The amount of support provided depends on the amount of primary energy saved by the plants. A requirement to receive the subsidy is that at least five percent of the thermal energy produced in the power plants in the form of steam or hot water be made available to consumers in the industrial sector. This increases the fuelfuel utilization rate of the entire power plant.
The Siemens SGT-800 industrial gas turbine combines a reliable robust design with high efficiency and low emissions. The turbine offers broad flexibility in fuels, operation conditions, maintenance concepts, package solutions and ratings. The SGT-800 turbine is suitable for power generation or cogeneration in simple or combined cycle modes. The latest upgrading with an increase of its electrical capacity by 3 MW to 50.5 MW was achieved by optimizing compressor performance as well as turbine aerodynamics and cooling air layout. The fleet leader with the new rating went into commercial operation in June 2011 and has now passed 20,000 hours.
A robust dry low emissions (DLE) combustion system reduces nitrogen oxide (NOX) emissions to a minimum. This was a key to success in the Thai small power producer market, which specifies DLE emissions systems as part of the technical plant specification and therefor as relevant for the awarding of the contract.
FLY THE FLAG OF FREEDOM!!!