Nigeria approves new power deals to boost Afam assets’ viability
The National Council on Privatisation (NCP), chaired by Vice President Kashim Shettima, has given the green light for the Bureau of Public Enterprises (BPE) to finalise its dealings with Transcorp Power Consortium. This move aims to execute new Performance Agreements (PAs) for the sale of Afam Power Plc and Afam III Fast Power Limited, following a government restructuring in 2024.
The approval, granted on Thursday during the NCP's third meeting of the year at the Presidential Villa, Abuja, comes after the BPE presented a memorandum endorsed by its Director-General, Ayodeji Ariyo Gbeleyi. The new PAs will formalise post-acquisition obligations and set operational targets to ensure the commercial viability of the Afam power assets. This decision follows the full handover of the asset to Transcorp Power Consortium in November 2020, and the Federal Government has already received N53.9 billion in news proceeds from the sale.
VP Shettima emphasised the critical necessity of this new direction. He warned against transactional ambiguities, demanding zero tolerance to avoid costly litigation and to instil confidence in the international investment community. He also directed the Council to explore modern models like long-term concessions and asset-backed securitisation tied to strict performance benchmarks.
The NCP's approval marks a significant step in aligning the transaction with updated performance expectations, investor commitments, and regulatory requirements. The new Performance Agreements are expected to enhance the commercial viability of the Afam power assets, further boosting the nation's power sector.
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