As part of efforts to further strengthen the Nigerian Bulk Electricity Trading Plc (NBET), otherwise known as the Bulk Trader, the federal government has secured a fresh $350 million Eurobond facility to boost its operations.
This was disclosed yesterday by the finance minister and coordinating minister of the economy, Mrs Ngozi Okonjo-Iweala, at the NBET corporate head office in Abuja.
Okonjo-Iweala, who is Chairman of the Board of NBET, informed that the $350 million facility has been given to the Sovereign Wealth Fund (SWF) to manage on behalf of the bulk trader. According to her, the decision was informed by the need to manage the facility in a way that the federal government can repay the loan by investing the money.
On why the money is being managed by the SWF she said, “Most of the Euro Bond money was taken to support the power sector, now when you think about it, this liquidity facility has to be managed in such a way that we are also able to repay the loan. So you need to think about the best way to invest this money.
“You can’t just have it sitting in the Central Bank, which was what we were doing initially, because it will earn next to nothing. So the best opportunity was to give it to the premier investment corporation of the government to manage it so that we can get some decent returns that will enable us to defray the interest cost of the repayment of the facility, even if it’s not all, at least it will be more than it will get sitting elsewhere,” she explained.
The minister, who commended NBET for its ability to craft power purchase agreements that will become a template for what will be done in the sector in future, noted that she was impressed with how the agency has set itself up to show that the model of the power sector reform Nigeria is pursuing can work.
In his remarks, managing director of NBET, Rumundaka Wonodi, said the agency looks forward to the guidance of the board to formalise operational policies like finance manual, human resources manual and others.
that will get the agency in a position to get the trading and portfolio management once the Transitional Electricity Market (TEM) is declared.
He added that the agency will also be presenting its statement of account for the past two years to the board, pointing out that the company plans to ensure that it stands on the good side of the law in all aspects of its operations.