Monday, May 11, 2009

Since coming to power, Nigerian President Yar'Adua has consistently committed his administration to solving the epileptic state of the nation's power supply. Yar'Adua named 2011 as the year when Nigerians will have reliable power supply. Over the last 2 years, there have been reports on plans to use solar energy and build a $10 million solar energy plant. There have been announcements by the government that it will harness the vast reserves of liquid natural gas (LNG) to remedy the power shortages. But, it seems the government believes that one of the most effective ways to generate sufficient power is through coal and the rhetoric on coal as a power solution continues to increase.

In April 2008, amidst the 'power probe scandal', the Yar'Adua administration formally announced its intent to use coal power. At that time, the then-Minister of Mines & Steel Development, Sarafa Tunji Isola,indicated that the nation was being wooed by Australian investors, Chinese and Indian mining interests in the hope of developing the nation's mining industry. The Minister also stated that the federal government studied other coal powered countries, such as South Africa and Canada, to ensure that internationally accepted practices and standards would be adopted and observed by Nigeria's mining industry.

On May 7th, 2009, the new Minister of Mines & Steel Development, Mrs Diezani Alison-Madueke, reiterated the federal government's commitment to developing coal as a power solution. At a meeting with Stanbic Bank where she addressed a future collaboration with the bank and her ministry, the Alison-Madueke said,
"We have worked very hard to put together strategic coal clusters over the last few months and this is very necessary because we want to make sure we have clusters which are strategically positioned to supply the right quantum of coal output so as to give us the right output in terms of megavoltage" [sic].
While Alison-Madueke's statement is not immediately decipherable, apart from stating a clear commitment to coal, it is clear that Nigeria must diversify its power-generation portfolio. The reliance on oil and hydroelectric dams have proven insufficient for the nation's energy needs either as a result of corruption or shortages/disruptions in oil and water supply. An American company, Western goldfields Inc., has discovered 62,400,000 metric tonnes of proven coal reserves, worth $1.2 billion (about N165 billion) in Enugu State. The use of coal in some parts of the country would therefore, be a beneficial use of natural resources for power generation.

Considering that neighborhoods in Lugbe, Abuja, and all over the country continue to go for weeks at a time without electricity, one can only wait to see how Yar'Adua will turn coal power into a reality. Especially considering that he will soon have to run for re-election in the next Presidential elections in 2011. However, whether or not he accomplishes the goal of improved power supply, will likely not affect his ability to win re-election if he chooses to run.

Please take the time to read the short article - 'Ekiti Elections: A Review' - which reviews the Nigerian blogosphere's discussion of the election. It includes comments/opinions from new and established Nigerian bloggers, as well as references to opinions shared by some Nigerian users of Twitter.

Related Articles:
- More Solar Energy Plans
- Solar Energy Plans
- Could Coal Be A Power Solution For Nigeria
- Nigeria Is Full Of Gas
- Power Blackouts Loom Across Nigeria
- Nigerian Power Scandal: Authority Stealing

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Danny Bagucci said...

Hmm.. More speak in lieu of action? If i remember correctly somme MOUs were signed off with some IOCs in the Obasanjo administration and a couple of Naija friends I knew actually were involved in some of the Front End Engineering for one of such..As far as I know, nothing major has come out that.. Hopefully they are progressing albeit silently and we will see the dividends shortly.

Good thing about coal though is that the technology is very well esablished and there should be enough technical expertise to make it happen fairly quickly - if there is the will to do it that is.

Anonymous said...

I hate to be a kill joy but I am so not impressed. we have heard too many promises in Naija, we can no longer jump for joy but we'll simply fold our hands and watch.
I still maintain that the governmenet cannot solve the power crisis, it has to be privatised. History has proven that the govt. can't run anything successfully: Nigeria airways, refineries, Telecoms etc. so they should simply stop trying and hand it over to corporations that can do it right.


Beauty said...

"We have worked very hard to put together strategic coal clusters over the last few months and this is very necessary because we want to make sure we have clusters which are strategically positioned to supply the right quantum of coal output so as to give us the right output in terms of megavoltage" [sic]. Your question immediately under the above incredible double speak made the point even clearer. What does that statement from the minister mean? How can one even speculate on information so vague and thin (note, I am trying to keep the language simple enough for me to understand). It is so unfair that even communicating strategy is made impossible by our so called government. As per @Danny's nothing major has come out that. Is it cynical for us to ask our government to stop bunny hopping on projects in order to focus on simple people-centric tasks?

OBJ did not deliver power in his 8 years as leader but should we continue in these pronouncements that yield zero other than inflated contracts that benefited the few badly educated politicians? May I add my voice to the debate of Coal is not a 21st Century answer to a 19th Century problem but then, there is clean coal.

Western Goldfields Inc and its technical partners from Russia and Ukraine are in Nigeria for their share/stock price but who will their high risk outlook benefit? Their investors or the few politicians that continue to earn crumbs in bribes? Cynicism? Yes. Not too long ago, our Federal Government disclosed that it spent $5.6billion on Ajaokuta Steel Company Limited but sold it for $500million. Palm wine and pepper soup all round.

Adaeze said...

Beauty said what I wanted to say. Coal is not a 21st century answer to a 19th century problem.

It sounds lovely for Nigeria to get a more stable power supply and more developed power-network. However I really wish they wouls use more environmental ways of generating electricity than coal. That way Nigeria could for once stay head on and be prepared/invest in the future, not something prehistoric. And I am critical about allowing foreign, greedy companies to do it. Are they just going to run away with the profit that belongs to the nigerian population. It's also left to see if this is true talk or just another bunch of empty, meaningless words, complicated by "fancy" English no common person can make sense of.

Anonymous said...

I have spoken to some people who were present at that meeting and the jist is that the Minister for Mines and Steel said she has identified a number of coal blocks that can be used to feed an independent power project (IPP) in order to generate electricity.

The good news is that a policy framework is in place to ensure that these will be private sector projects, so they are more likely to work. Their feelings were that the Minister of Mines and Steel is 100% behind this project.

However, some private investors who have already put a lot of money into the sector (but who were not at the meeting) have also told me that there are challenges that must be surmounted in order for Coal to Power to materialise.

One such challenge is infrastructure. Power lines do not exist to many of these coal locations. In addition, the lines from the nearby transmission stations (going out through the National Grid) would need to be strengthened to carry the increased load. These issues need to be resolved by the Ministry of Power who would have to factor the cost into future budgets before any work can commence.

Then there are policy issues. The view of the people I spoke to is that the Federal Ministry of Power appears to be partial to gas powered turbines at the expense of coal because it has been difficult to get them to seriously address the issues relating to the sector (like improving transmission lines). But the biggest problem of all is the tariff (i.e. the price at which an IPP is allowed to sell electricity). They say that as it stands, it is not commercially viable for IPP's. So unless the National Electricity Regulatory Commission (NERC) changes its stand on this the dream may never be realised.

Their hope is that now that they have the support of the Minister of Mines and Steel that progress will begin in these areas.

So in conclusion, it would appear that the Minister for Mines and Steel is doing her best to promote Coal to Power but unless the Ministry of Power gives its full support to the program the project will not succeed.

Anonymous said...

........yeah right! Commitment is quite different from delivery.


Beauty said...

So in conclusion, it would appear that the Minister for Mines and Steel is doing her best to promote Coal to Power Incredible stuff from Anonymous but how does one reply Amebo? It will be more credible to come out than closet debate. However, the money is on infrastructure while PHCN's efficiencies drives the project.

Sugabelly said...

Great, Nigeria is going to make Global Warming happen a little FASTER.

baraal said...

Getting the power situation in Nigeria fixed is an absolute necessity but i'm very skeptical about the use of coal. I mean, other countries are trying to move away from oil and gas for their energy needs and we are turning to coal. Whose bright idea was that?

As one earlier commenter pointed out, we need to be more forward looking in our national investments otherwise in a few decades when every one else abandons dirty fuels we could find ourselves back at square one with all the money spent so far going to waste (with some 'contractors' being enriched in the process).

Christmas Eve said...

Lol hmm i don't approve of them banning it o. But if they provide steady electricity then I will agree with them.

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