Govt tops Disco, oil firm’s debtors list
The Federal Government has been identified as the largest debtor to the power distribution companies, even as it defaults on the cash calls for crude oil agreement with the major exploration and production companies.
Besides, some power sector officials that spoke with The Guardian confirmed that the Federal Government agencies owe them huge amounts of money thus posing a threat to their project proposals.
The Society of Petroleum Engineers (SPE) Nigeria Council, in a communiqué after the Nigeria Annual International Conference and Exhibition (NAICE) at the weekend said that gas development with the right strategy could achieve adequate power supply in the country by 2017.
The communiqué signed by its Chairman, Emeka Ene, also highlighted some observations at the conference which included that gas is the future of Nigeria, the key to unlocking the economic potential of Nigeria and increasing the living standards of the average Nigerian.
Although, it noted that high development cost of gas projects and low oil price is currently unfavourable to the industry, it pointed out that the extent of collaboration for the gas industry will determine the success of the industry.
“Gas to power will generate huge revenue and save money for Nigeria. Power distribution pricing to investors must be conducive for investors to improve the power sector. Regulatory framework alone is not sufficient to address the gaps in Nigerian Gas Supply. There are no concrete plans in place currently to sustain gas supply to the Nigerian Gas Company. Most of the gas supplied goes directly to the power needs of the country and Government cannot secure the gas to power.” It stated.
The group, therefore, recommends that government should set up critical infrastructure force with a direct line of sight and accountability matrix and a combination of enlightenment, empowerment and enforcement of anti-sabotage laws.
It also urged that incentives should be given on investment in Domestic Gas projects across all components of the value chain. Tax holidays, tax rate reduction, de-rated tax system etc are examples of the incentives needed.