The Nigerian Bulk Electricity Trading Plc (NBET) along with the Nigeria Sovereign Investment Authority (NSIA) have closed a deal to manage the $350 million allotted to the former from the $1 billion Eurobond released in July 2013 by the federal government.
The Managing Director and Chief Executive Officer of NBET, Mr. Rumundaka Wonodi, signed for bulk trader while Managing Director and Chief Executive Officer of NSIA, Mr. Uche Orji, signed on behalf of his agency, in the funds management agreement .
The federal government had on July 2, 2013 issued a $1 billion Eurobond, which the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, noted was meant for financing power projects considered integral to unlocking the nation’s economic potential.
Specifically, she disclosed that the bond would be partly used to finance gas to power and transmission rehabilitation as well as increase NBET’s capitalisation as a credit worthy off-taker.
Similarly, Okonjo-Iweala, who is also the chairman of NBET’s Board, had on February 10, 2014 at the Nigeria Power Sector Investors’ Conference announced that the NBET’s $350 million liquidity facility would be given to NSIA to earn interest for the bulk trader to offset some of the interest payments until such a time when NBET will require the funds.
Commenting on the agreement, Wonodi stated: “NBET is happy with this arrangement that allows a competent fund manager like NSIA manage NBET’s Eurobond facility in a manner that yields the required returns yet allows the funds to be readily available for any required Bulk Trader interventions. With this arrangement, NBET can focus on developing the electricity market and catalysing much needed investments in the power sector.”
In his own remarks, Orji said: “NSIA is pleased to enter into this asset management arrangement with NBET. It is our aim to bring our proven capabilities in profitable asset management to bear for the benefit of NBET and the Nigerian power sector in general.”
