The House of Representatives Public Accounts Committee has summoned the Central Bank of Nigeria (CBN) and the 11 Electricity Distribution Companies (DisCos) over the loans of $321 million and N18.2 billion granted to them for the accelerated transmission distribution interface, lines and substation projects.
The projects are aimed at enhancing the capacity of the transmission and distribution lines in the power sector.
The committee, chaired by Bamidele Salam (APC, Kano), issued the summon on Thursday, November 2, after the passage of the N2.17 trillion supplementary budget by the House.
The committee said it received a petition alleging that the funds were not judiciously used and that the projects were not delivered as expected.
The committee invited the CBN and the DisCos to appear before it on November 8 to explain the details of the disbursement of the loans, the procurement process, the status of the projects, and the structure of the repayment of the loans.
The committee’s decision was based on the presentation of the Managing Director of the Transmission Company of Nigeria (TCN), Sule Abdulaziz, who appeared before the committee on Thursday.
Abdulaziz told the committee that the funds were paid directly to the DisCos by the CBN on the prompting of the TCN, and that the repayment of the loans was from the revenue of the TCN. The committee expressed discomfort with the repayment arrangement, saying that the TCN should have been more involved in the execution and monitoring of the projects.
Abdulaziz said that the TCN initiated the projects because there was a gap in the electricity sector and the DisCos were complaining that the TCN was not giving them enough supply. He said that the TCN did not have the funds to invest in the projects, so the Federal Government involved the CBN as the financier of the projects.
He said that the Nigerian Electricity Regulatory Commission (NERC) was the regulator of the projects, and that the TCN and the DisCos set up a multi-stakeholder project management office to undertake the procurement and evaluation of the projects.
Abdulaziz said that a total of 125 projects were identified and agreed upon in the tripartite engagement, and that the NERC approved the project list and the securing of financing from the CBN for the same projects to the tune of about N122.3 billion in loan.
He said that the DisCos were the beneficiaries of the projects and took the loans on behalf of the TCN to execute the projects. He said that the loans would be amortised from the TCN’s revenue on a monthly basis.
The committee’s summon came on the heels of a report by Reuters, that the United States waterborne imports of crude from the Organization of the Petroleum Exporting Countries and its non-OPEC partners, dropped steadily over the last year, further tightening supplies in the U.S. while supporting other markets including Europe.
The report said that total U.S. crude waterborne imports averaged 2.47 million barrels per day in October, down from 2.92 million bpd in September, according to figures from data intelligence firm Kpler, with shipments falling from OPEC+ producers including Nigeria, Algeria and Saudi Arabia.
