From Uche Usim, Abuja
In an effort to deepen power generation, the National Council on Privatisation (NCP) has granted approval to Orbit Exploration and Natural Products Limited (OENPL) to take over the mineral titles of Ogboyega North and South coal blocs, Mines number 769 & 772 ML from Western Metal Products Company (WEMPCO).
By this action, OENPL is set to generate electricity with coal from mines.
Ibeh Uzoma Chidi, the Head, Public Communications of Bureau of Public Enterprises (BPE), who made the disclosure in a statement said that the decision to outsource the mines to a new operator was one of the major highlights of the meeting of the NCP, presided over by the Vice President and its Chairman, Yemi Osinbajo (SAN), held recently at the Presidential Villa, Abuja.
In granting the approval, the Council noted that BPE’s due diligence on the enterprise indicated that OENPL can provide the financing and technical expertise needed to successfully operate the mines.
It further noted that WEMPCO had requested for BPE’s approval to transfer the mineral titles of the two coal blocks to OENPL in line with the provisions of the Asset Share Purchase Agreement (ASPA) and that OENPL has proposed to spend N112 billion to procure equipment for operationalising the two coal blocks and power generation.
Ogboyega North and South Coal Blocks were sold to WEMPCO in 2007 at the fee of $7,378,150 and $7,678,250 respectively.
However, 15 years after the transaction, the two coal blocks have not been fully operationalised.
Consequently, WEMPCO requested the Bureau for approval to transfer the Mineral Title of Ogboyega Coal Block to Orbit Exploration and Natural Products Limited (OENPL).
This necessitated the Bureau to review the provisions of the Assets Sale Purchase Agreement (ASPA) executed with WEMPCO which confirmed that the request conforms with the provisions therein, particularly Article 18.6 which allows such transfer of shares, subject to the consent of NCP/BPE.
Having studied the business plan and financial position of OENPL, the BPE recommended that it was capable of operating the mines.