Geregu Power Plc is in bidding to acquire one of the National Integrated Power Plants (NIPPs) being put up for sale by the Federal Government through the Bureau of Public Enterprises (BPE).
In July 2022, the company issued N40.085 billion unsecured corporate bond for a 7-year tenor and at a coupon and effective interest rate of 14.5% and 14.70% respectively.
“The net proceeds would be used to finance the acquisition of a similar power plant in Nigeria which is currently in the final stage of bidding processes by the Bureau of Public Enterprises (BPE),” Geregu Power said in its 2022 Full Year financials.
Geregu Power borrowings are initially measured at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost.
The power firm reported a 33% decline in revenues in 2022.
The decline in revenue was largely due to gas supply constraints as a result of a nationwide force majeure (FM) declared by Shell Petroleum Development Company Limited
on the Trans-Forcados pipeline and its consequent effects on the Forcados oil terminal, gas supplies to the power plant by Its primary gas supplier, which ceased from 17th of July 2022.
The maintenance works on the pipelines were however completed at the end of November 2022 and gas supplies and normal operations have since then resumed.
The Federal Government has assured prospective power investors that the five National Integrated Power Plants (NIPPs) put up for sale will go on as planned.
Director General of the Bureau of Public Enterprises (BPE), the agency overseeing the privatisation of the five plants, Mr. Alex A. Okoh, said that the move was in line with the bureau’s 2021 work plan as approved by the National Council on Privatisation (NCP) and would be strictly adhered to.
The plants are: Benin Generation Company Limited at Ihovba, Edo State; Calabar Generation Company Limited, Cross River State; Geregu Generation Company Limited, Kogi State; Olorunsogo Generation Company Limited, Ogun State; and Omotosho Generation Company Limited, Ondo State.