Lagos State Signs $3 billion Agreement With Investors for 3,000 MW

Akinwunmi-Ambode (1)

In Nigeria, the Lagos state government has signed an agreement with investors to generate 3,000 megawatts of electricity over the next seven years.

The agreement tagged “Lagos State Embedded Power Programme”, involves the supply of 3000MW of electricity at the cost of $3billion. This is however subject to approval by the Nigerian Electricity Regulatory Commission (NERC).

According to the document, the Phase 1 of the programme will be commissioned before the end of the first quarter of 2018 and will deliver 520MW of electricity while another 1, 070MW will be delivered in the fourth quarter of 2018. The remaining 1, 410MW will be completed by 2022.

Under the agreement, the state government will provide a 3 months bank guarantee to support the Power purchase Agreements (PPAs), expected to be signed between the Distribution companies (Discos) and the embedded power providers (EPPs). This will enhance the bankability of the projects.

The government will also secure gas for the projects through the provision of guarantee to gas suppliers using the state oil company, Ibile Oil & Gas.

“Given the intractable challenges of local gas market, and to guarantee uninterrupted gas supply to the EPPs, Lagos State has finalized arrangements with reputable international gas suppliers to deploy a floating storage and regasification unit (FSRU) to be moored on Lagos waters and this will be further supported by trucking of LNG from the South-South (in the short-term),” the document reads.

Source: Asoko Insight

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