INVESTMENT OPPORTUNITIES IN THE POWER, STEEL AND ALUMINIUM SECTORS.

INVESTMENT OPPORTUNITIES IN THE POWER, STEEL AND ALUMINIUM SECTORS.

POWER SECTOR:
Government has concluded plans towards revitalization of installations of the Power Holding Company of Nigeria (PHCN, forerly NEPA)to enable it meet its total installed capacity of 10,000MW by December 2007. Sufficient funds are being injected for the rehabilitation of ageing plants and equipment. In order to allow full private sector participation in power generation, transmission and distribution, government has accepted to deregulate the sector by the year 2000. This will allow local and foreign investors to build, own and operate and/or transfer independent electricity. All laws that inhibit private sector participation in the power sector are being reviewed with a view to amending them and encouraging investment. This step will complement the de-consolidation of the industry as far as the state-owned PHCN is concerned. The hitherto largely over-centralized operations of this agency will be decentralized.

Guidelines and framework for Independent Power Products (IPP’s) are now being put together following the interests and applications already put forward by independent producers from all around the world.

Investment Opportunities exist for hydro-power generation in Mambilla Fall, Adamawa State and Agbokin fall in Cross-River State. PHCN will readily negotiate a Memorandum of Understanding (MOU) with any foreign energy company to cover the following areas:
i) Development of energy resources and infrastructures,
(ii) Management of energy infrastructure;
(iii) Commercialization of energy
(iv) Training; and
(v) Exchange of information and experience.

It is expected that further discussions will centre on:

(i) Construction and management of power stations by private companies;
(ii) Production of Steam and gas turbine spare parts;
(iii) Repairs and testing of power transformers;

(iv) Development of wind turbines for generation of electricity;
(v) Manufacture of distribution transformers and line hardware;
(vi) Technology transfer through joint erection of new power plants;
(vii) Training of PHCN staff in computer based maintenance system etc.

PHCN and the foreign company will then set up a joint committee for the purpose of achieving these objectives.

THE STEEL SECTOR:
The Federal Government, through the BPE has already divested Government holdings in Delta Steel, Aladja, Ajaokuta Steel, Ajaokuta and the inland steel rolling mills.

With a large percentage of annual domestic consumption of steel products fed by imports, the sector is wide open for new investors t build new steel plants with captive power plants to satisfy their energy needs. Steel products from Nigerian plants also have an open market in the West Africa through the ECOWAS trade protocols

THE ALUMINIUM SECTOR:
Government holdings in the Aluminum Smelter Company of Nigeria, ALSCON, Ikot Abasi has been divested. Output from the plant does not meet domestic current domestic market and there are open markets in the West Africa trade zone.