By Uche Amunike
The Nigeria Bulk Electricity Trading Company (NBET) has made allegations to the Transmission Company of Nigeria (TCN) for being responsible for their failure to recover a $69.38 million debt owed it by two international firms situated in Benin Republic.
Recall that apart from being the only coordinator of power sales on behalf of the federal government, NBET is also directly supervised by the Federal Ministry of Finance.
The allegation made by the Transmission Company of Nigeria is contained in the response made by the management’s audit query from the Office of the Auditor General for the Federation on non compliance/internal control weaknesses in Ministries, Departments and Agencies of the Federal Government of Nigeria for the year ended December 31, 2020.
The audit report with reference number AuGF/AR/2020/02, was signed by the Auditor General, Shaakar Chira. On December 20, 2023, it was submitted to the clerk of the National Assembly by section 85(2) and (4) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended).
According to the management: ‘In June 2017, NBET and the TCN) through a joint letter, advised the Nigerian Electricity Company and Beninois Electricity Company respectively that they should continue to credit the account of TCN Market Operator pending the signing of the agreements that would put in place a new contractual /commercial framework with NBET.’
‘NBET proceeded to negotiate a new contractual/commercial framework with CEB and NIGERLEC respectively, but faced challenges from both TCN and the international customers in finalizing the new power sale agreements that would pave the way to fully assume the administration of these contractual relationships.’
‘While the government has directed NBET to conclude the international contractual engagements, TCN however wrote to the Federal Ministry of Power asserting that NBET has no role in the ECOWAS regional Electricity market and cannot be executing contracts with CEB and NIGELEC.’
The letter also stated that the Transmission Company of Nigeria is responsible for recovering all outstanding debts, noting that they already reconciled their outstanding debts and we were discussing a payment plan for clearing the debt.
It also implied that the transmission company is the best positioned company to render an account for the outstanding payment, adding that NBET is taking the proper steps from recovering its portion of the payments that have been credited to the Transmission Company of Nigeria.
In its audit query to the government owned company, the Auditor General for the Federation alleged that NBET failed to recover about $69.40 million, which is equivalent to about N25.19 billion, when checked at the rate of N363 to a dollar, as the January 31, 2019.
The query partly read: ‘Audit observed that the company entered into an agreement with two firms that are based in Benin Republic for the supply of electricity to those firms. From the review of records available for audit, the company commenced the supply of electricity in January 2015.’
‘As of January 2019, the value of supply made to the two foreign firms amounted to $315.41m. Review of invoices provided for audit, however, revealed that, as of January 2019, the firms had only made payments to the tune of $246.02m leaving an outstanding of $69.38m.’
‘The company failed to provide for audit clarification and efforts made to ensure the recovery of these huge amounts which in Naira, amounts to N25,19bn at the rate of N363 to a dollar as of 31st January 2019.’
