On behalf of the Federal Government, the Nigeria Bulk Electricity Trader (NBET), has signed a Power Purchase Agreement (PPA) with Qua lboe Power Plant Limited (QIPP) to build a 540MW gas-fired power facility worth $1.1billion in Akwa Ibom State.
The Nigerian Guardian reports that this led to the striking of a Put/Call Option Agreement (PCOA) between the QIPP, NBET, Nigerian National Petroleum Corporation (NNPC) and the Ministry of Finance.
The Minister of Power, Works and Housing, Babatunde Fashola, who presided over the event yesterday in Abuja, explained that the PCOA details the government’s obligations supporting QIPP’s PPA.
The minister further explained that the agreement marks another effort to increase power supply nationwide.
QIPP was jointly developed by African energy infrastructure company, Black Rhino Group, Dangote Group and the NNPC, following the purchase of the rights to develop the project from Mobil Producing Nigeria Unlimited, a joint venture between ExxonMobil subsidiary, Mobil Producing Nigeria and the national oil company.
Fashola noted that QlPP would be one of the lowest cost thermal power plants in the country due to its efficient design and competitive gas price. The project is to get gas from Mobil Producing Nigeria under a 20-year Gas Sales Agreement via a new 400mmscfd undersea gas pipeline from the oil firm’s existing offshore production facilities.