President Muhammadu Buhari‘s Special Adviser on Infrastructure, Ahmed Zakari, on Wednesday noted that the Federal Government did not sign any document from 2013 to 2015 compelling it to pay $1.2bn if it defaulted on the contract for the Azura-Edo Independent Power Plant.
Gabriel Suswan, the Chairman of the Senate Committee on Power, had last week claimed that the President Buhari government signed power agreements with Azura to generate 450 megawatts of electricity.
This is coming after the Senate condemned the Federal Government over the monthly payment of $30m for power and resolved to assemble local and international experts to review the agreement.
Zakari, in a statement entitled ‘Partial risk guarantee not an issue in Azura-Edo IPP contract, says Presidency’, said, “Clearly, the controversy as to who signed the agreements has no real basis if indeed the only quest is for the plain truth.”
He said those who argued that the signing of the World Bank guarantees made the Federal Government under Buhari responsible for contracting Azura needed only to look at the two basic transaction documents.
He said, “Another curious mischief in this controversy is the assertion that Nigeria will become liable in the sum of $1.2bn if it defaults on the Azura contract. Nowhere in any of the documents signed from 2013 to 2015 is any such figure mentioned.”
“The only possible payout indicated in any of the agreements is in case the put and call option is activated.”
“In that event, the cost of the plant would be worked out using a formula and become due for payment, but at least Nigeria will get in return a functional 461MW plant.”
The Presidential aide noted that since the current administration had chosen not to cancel the deal, it has decided to issue the required legal opinion and signed the World Bank guarantees that had been initiated in April 2014.
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