Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others - Politics - Nairaland
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| Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by Kobojunkie: 2:33pm On Jun 25, 2010 |
[size=13pt]FG Agrees To Pay N458b PHCN Debt To Gas Firms, Others[/size] http://www.independentngonline.com/DailyIndependent/Article.aspx?id=15955 The Federal Government has agreed to pay the N458 billion trade liabilities with local and foreign debts, which the Power Holding Company of Nigeria (PHCN) owed some oil companies and others for gas supply. This decision was a part of the Bridging Loan Agreement (BLA) signed after a meeting with oil majors in Abuja. The PHCN, it would be recalled has a total debt of N458billion made up of trade liabilities including local and foreign loans. Daily Independent gathered that the government has also agreed to convert the loans to equity as a way of repayment. An internal document of the PHCN showed that the company owes the Nigerian Gas Company, a subsidiary of the Nigerian National Petroleum Corporation (NNPC) and Shell Petroleum Development Company (SPDC) N8.4 billion and N1.54 billion respectively for dry gas supplied to its thermal power plants. The utility company also, as at March 2010, owed Shell’s independent power plant and Nigerian Agip Oil Company’s independent power plant N3.9 billion and N51.1billion respectively for electricity it bought from the companies. But Country Chair of Shell in Nigeria, Mutiu Sunmonu, said: “On the debt incurred by the Power Holding Company of Nigeria, the Federal Government has entered into the Bridging Loan Agreement with our company,” he said. “In 2009, Shell Nigeria Gas Limited supplied natural gas from fields in the Niger Delta to more than 50 customers in industrial centres in Ogun and Abia states, while SPDC is the major gas supplier to the Nigeria Liquefied Natural Gas (NLNG) plant from its various field,” he added. Meanwhile, an earlier document from the PHCN also indicated that it owes Lahmeyer International Consultancy N384billion and has owed its staff monetisation arrears since 2003 worth N64.9billion Other trade liabilities by the PHCN include N10billion owed as taxes to the Federal Inland Revenue Service; N12.2billion owed NICON Insurance as insurance claims; N1.2billion owed to sundry creditors and N1.5billion statutory deductions for Industrial Trust Fund. Other outstanding debts owed by PHCN are in favour of Mitsubishi Corporation for the maintenance of Jebba hydro station; British Electrical Industrial Limited for the maintenance of Sapele thermal power plant; and Campagnia Electro Tech Italian Spa for the maintenance of Lagos Distribution System extension. PHCN in the same vein, owes GE High Voltage for the maintenance of 330KV substations in Benin, Jebba and Osogbo. “PHCN also owes the Federal Government N14.7bn, which it borrowed and used to finance sundry capital expenditure between 1990 to 1998,” the document added. Similarly, the company also owes state governments N8m borrowed in the 1970s and used to finance sundry capex. The utility company also took overdraft worth N2.7bn from Afribank, First Bank, Union Bank and United Bank in 2003. Foreign loans which were used to finance the construction of power stations in the 1970s and 1980s, notably Jebba and Egbin stand at N37bn while World Bank and German government loans used to finance capex stand at N9.4bn and N2bn respectively. Other loans taken by PHCN in 2005 included N18bn owed SEPCO, which was used to finance Olorunsogo power plant and N18bn taken from CEMEC in 2006 and used to finance Omotosho power plant. Sunmonu who is also the Managing Director of Shell stated: “In 2009, Shell-operated ventures in Nigeria produced an average of 629, 000 barrels of oil equivalent per day (boe/d)-about 21 per cent of Nigeria’s estimated total oil and gas production; about 444, 000 boe/d of this volume came from the SPDC-operated joint ventures, while SNEPco accounted for the balance. |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by deor03(m): 2:55pm On Jun 25, 2010 |
Horrible Management. While Nitel was borrowing money from FG in the past; MTN is painting the whole continent yellow from the money made in this country now ! |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by desgiezd(m): 3:08pm On Jun 25, 2010 |
What a way to manage a company. Little wonder the top officials of the company are fabulously rich while the company itself is suffocating under the weight of billions of Naira debt. |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by seanet02: 4:46pm On Jun 25, 2010 |
Even with this calamity performance, useless country |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by netotse(m): 7:17pm On Jun 25, 2010 |
it's funny how nobody is mentioning the fact that phcn gets paid for only 49% of the electricty it distributes in simple english. . .49% of all the electricity generated in nigeria is stolen! until nigerians stop displaying their rare brand of stupidity and illiteracy there wont be electricity. . .it's that simple! |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by paddylo1(m): 10:19pm On Jun 25, 2010 |
Horrible Management. well u gotta blame the likes of kobojunkie that insist on GOVT control of everything The problem is that PHCN is not a company. . .It is a GOVT controlled wastepipe Would any of u lend a kobo or cent to PHCN if it came to u for a bank loan?. . .no Whearas serious companies manage their books well and can get loans for expansion like MTN which just got a $3billion dollar loan from Nigerian banks a few weeks ago. . . and dont think its a nigerian situation only cause in America the GOVT run post office is broke AMTRAK is broke,the GSEs Fanny Mae and Freddy Mac are bankrupt and so on. . all GOVT run |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by marvix(m): 10:42pm On Jun 25, 2010 |
Let us take a look at those debt list and ask ourselves how many of them was incured within 2007 to date. Most of the debts were incured by Obj and IBB, these are the things that Yaradua met on ground and had to resolve because the power stations we want to give credit to Obj for were never paid for, that the FG today is planning to pay means that work has been going on to ascertain the true positions of the debt situation, so we can at least make arrangements on how we will pay the debts and then the companies can sign new agreements with the govt on gas supply. Obj is the biggest fraud in this country!!! Where is all the money we made in 1999-2007. I know some of his loyalists will point to the debt relief from World bank, but I can assure you that with time we will understand more abt d debt burden, I wont be surprised If Obj refused to pay all d debts |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by paddylo1(m): 11:37pm On Jun 25, 2010 |
Where is all the money we made in 1999-2007. All the money u made from 1999 - 2007,went towards,salaries,Capital projects,Debt payments of about $15billion 13% derivation payed to oil states,48% payed to states and local Govt PLus CBN Foriegn reserves of $58billion and another Excess crude account of $20billion left behind as at 2007 what else do u want? OBJ is no fraud. .he is the most Prudent leader we have had since 1980 Its funny that the Yar adua u want to defend met $20billion in excess crude,but spent it to $5billion by the time he died While the CBN reserves fell From $58billion to $40billion and for 3yrs there was nothing to show. .NNPC became more corrupt,leading to leakages in GOVT Revenue |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by naijamini(m): 1:41am On Jun 26, 2010 |
@paddy_lo OBJ certainly could have blown the funds, pay no debt or simply steal it - for his prudence he deserves credit & for some other things as well (e.g. telecommunications). However, what Gen. OBJ built with his right hand, he destroyed with the left by not really understanding what it would take for his legacy to be sustained - both in the 1970s & 2000s. It is rare for a man to have two opportunities to rule and set a nation straight like OBJ did, especialy so far apart in time, and yet make the same mistake TWICE. He was prudent this time no doubt - perhaps that was the only lesson he learnt from the 1970s. However, in terms of the amount of income Nigeria made from oil exports during his two times in office, he was luckier than good because he took over precisely during oil booms and left before the ensuing bust. As for Yara'dua spending all the savings - he really had no choice. He certainly made matters worse by his slowpoke, vengeful approach to governance trying to overturn anything OBJ did. Black gold was both the source of OBJ's luck and Yar'adua's downfall ---> 1999:$17/bbl; rising steadily for 8 years 2007:$60/bbl; mid-2008:$147/bbl; within 2 years Early-2009:$40/bbl. Imagine if OBJ had searched for and presented to Nigerians a visionary - we know he basically appointed Yar'adua, why not someone good for the country? paddy_lo: |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by DisGuy: 11:43am On Jun 26, 2010 |
paddy_lo: you have conveniently ignored the effect of global economy and the price of crude oil during both tenures - Firebrand economist  |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by paddylo1(m): 1:22pm On Jun 26, 2010 |
you have conveniently ignored the effect of global economy and the price of crude oil during both tenures - Firebrand economist what effects of Global economy?. . .the recession didnt start till end 2008 However that is no excuse to run down your reserves and ECA. . with nothing to show Yar adua was no President,he was equivalent to shagari,who allowed all kinds of corruption to go underneath him meanwhile he is too weak to do anything Go and read a business day online report,about how Nigerias oil receipts were moved from the CBN to NNPC under Yaradua,which led to leakages of oil revenue dont get me started. . here click link to read http://www.businessdayonline.com/index.php?option=com_content&view=article&id=11111:why-nigerias-reserves-is-not-following-oil-price-trend&catid=1:latest-news&Itemid=18 |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by Kobojunkie: 3:29pm On Jun 26, 2010 |
Dis Guy: Insert Global food crises there too!!! |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by IRAPADA(m): 3:48pm On Jun 26, 2010 |
Shey this Phcn no dey make profit?.I think phcn shd be privatise or sel it to those company they where buying power frm. |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by CarlosVent(m): 6:34pm On Jun 26, 2010 |
DIS IS ALARMING HABA. LET DEM TAKE SANI ABACHA LOOT IN SWISS BANK AND PAY D MONEY |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by kobikwelu(m): 11:08pm On Jun 26, 2010 |
i have always said that the solution to these waste pipes is to privatize 'em!!!! i know some wont agree but i feel thats the only way these companies can operate optimally and compete with the best!!! when nigerians handle govt property, there is no sense of responsibility, the general mentality is " NO BE MY PAPA PROPERTY" |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by DisGuy: 12:47am On Jun 27, 2010 |
kobikwelu: For an extremely capital intensive and complex case liek the PHCN, you will need to have it on gorund working and expandable before you can actually privatise these things-- no matter how rare and valuable a 1904 car is; a car enthusiast wont necessarily be rushing for it in africa it it has no engine or repairable suspension!!! Private sector wont just rush in for a moribund troubled infrastructure like our current PHCN when the laws are not clear on who owns what or what is actually for sale, distribution, generation or transmissions |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by DisGuy: 12:52am On Jun 27, 2010 |
paddy_lo: if you go from $140 to $44 and production decreasing steading your savings will definitely go down, and with scarce funding from international org you have to use your own savings to keep things stable especially for a country with massive infrastructural deficit |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by paddylo1(m): 1:48am On Jun 27, 2010 |
For an extremely capital intensive and complex case liek the PHCN, you will need to have it on gorund working and expandable before you can actually privatise these things-- no matter how rare and valuable a 1904 car is; a car enthusiast wont necessarily be rushing for it in africa it it has no engine or repairable suspension!!! Yea the laws have to be in place,but u got it wrong about things needing to be in place. . The GOVT just doesnt have the kind of funds needed to invest in transmission,generation and distribution A lot of investors are willing to bring in money to invest. . and they dont necesarilly have to buy PHCN infrastructure,they can build from scratch or alternatively the half built Power plants can be sold to them I remember when suharto was leaving power in Indonesia he sold power plants to his cronies in the private sector Today there is no power shortage in indonesia as the companies that bought those plants have continued to build new ones as demand fro power grows so like u say,if we get the legal framework done,it will be a milestone |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by paddylo1(m): 1:51am On Jun 27, 2010 |
if you go from $140 to $44 and production decreasing steading your savings will definitely go down, and with scarce funding from international org you have to use your own savings to keep things stable especially for a country with massive infrastructural deficit In 2008 when oil peaked at $144 a barrel our national budget was pegged at $57 a barrel. . by 2009 we were able to adjust. . so in essence there really should have been not too much effect if the executive pushed prudence $20billion is a lot of money. . .It shouldnt have been spent so fast with not much to show. . . |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by netotse(m): 8:43am On Jun 27, 2010 |
Dis Guy: paddy_lo: *sigh* time and time again, i keep asking myself if there's hope for the nigerian power sector the legal framework is in place already i agree with that the sector doesn't have to be 'on point' before investors come in. . . where you people fail in your analysis is that you cant see the picture as it truly is. . . [size=14pt]the number one reason investors wont come and build power stations or buy the existing ones is because they wont make a profit![/size] which of course (as i have stated times without number) is because govt is allowing PHCN to charge prices that reflect the costs, you generate at 10naira and you sell at 7.00naira which company would want to come and invest it's money? we like to compare power to telecoms, but when the GSM companies started where they operating at a loss? people that had waivers, got to choose their own terms, and were making profit under 2 years |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by kobikwelu(m): 10:40pm On Jun 27, 2010 |
@disguy so you are suggesting the gov put in "more" money to get PHCN running before investors come in  ?for the last 10 yrs, how much has bin put into PHCN how has it improved the lot of the company ?the problem is that people forget that "readymade" policies DO NOT WORK FOR NIGERIA!!! our case is peculiar, the last time i checked, investors conducts due diligence on a company they want to acquire, in the end they put a price that is comensurate with the value of the company, they should off-load these waste pipes, |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by DisGuy: 10:36am On Jun 28, 2010 |
netotse: oxymoron you said the law is already in place, then went on to say govt is fixing the price of electricity at below generation rates so govt make law for private investor then fix price at a loss to same investors = oxymoron |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by DisGuy: 10:55am On Jun 28, 2010 |
kobikwelu: theres a reason investors are not rushing in and ive stated my opinion about that up there, as much as the sector is a goldmine they wont come into a 'peculiar' case like these when you set price for them to make at a loss, tey wont come in if tehy are not sure you wont reverse the 'subsidy' granted 2-3years ago, they wont come in if basic due deligence cant even be done because they dont know who owns what or who exactly will be handling past employees like the case of NITEL, ajaokuta, refineries, nigerian airways etc Investors coming into a PECULIAR country like ours want to be able to make their money fast before things goes titts up NITEL, the refineries, the steel companies etc etc |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by tithe(m): 11:11am On Jun 28, 2010 |
so PHCN has become a national burden!!  |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by Lanko0071: 4:02pm On Jun 28, 2010 |
3 units of 2008 corolla that just came from US for sale, just 15k miles (N2.5m). Very clean, just came in from US. Also, 2004 nissan morano (N2.85, Acura TL (1.5m), and Benz E class (1.7m). Interested? call or text to 08023679519 or mail lanko2004@hotmail.com. So sorry for breaking your topic. All prices negotiable |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by Lanko0071: 4:06pm On Jun 28, 2010 |
3 units of 2008 corolla that just came from US for sale, just 15k miles (N2.5m). Very clean, just came in from US. Also, 2004 nissan morano (N2.85, Acura TL (1.5m), and Benz E class (1.7m). Interested? call or text to 08023679519 or mail lanko2004@hotmail.com. So sorry for breaking your topic. All prices negotiable |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by netotse(m): 8:14pm On Jun 28, 2010 |
Dis Guy:ever heard of MYTO(multi year tariff order)? how would you feel if govt jerked up the price to 18naira all of a sudden? that's the point i was making, govt plans to raise it to 8naira next year(or is it 10? i cant remember) and NLC and other interest groups are already screaming, not to mention the noisemakers on NL. . . and at the price they want to raise it to(i.e. 10 or 8 naira) you haven't even started making profit o. . .not to mention the costs of distribution infrastructure or building more power stations. . . |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by Rmc1(m): 5:02am On Jun 29, 2010 |
Fg should privatise phcn, we have all been shouting this for a long time. Let fg give the privatisation process a trial time period of 5years and if things dont work out they can still take PHCN back. |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by faisal015: 10:16am On Dec 10, 2010 |
Bridging loans could be an option. They have an established provider of bridging loans for both investors and people looking to raise extra finance for a variety of reasons. If you want to raise money to buy a property at an auction, it would be the best tool. Visit here: Bridging loans |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by Nobody: 11:51am On Dec 10, 2010 |
Bridge loans usually have high interest rates and are tenored for not more than one year. Its going to put some pressure on us. Pray they sell the PHCN units so that will act as a source of repayment |
| Re: Fg Agrees To Pay N458b Phcn Debt To Gas Firms, Others by marjone11: 5:21am On Dec 23, 2010 |
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