A Major Setback in the PHCN Privatisation Process: Presidency Scraps Contract to Canadian Power Transmission Company

Just when Nigerians are still in a mood of celebration over the recent announcement of the completion of the privatisation process of the Power Holding Company of Nigeria, a major setback has occured. On Wednesday, 14th November 2012, the Presidency said it had terminated a $24 million electricity contract with Canada’s state-owned Manitoba Hydro which had previously been hired to manage the national power transmission network.

According to Reuters, President Goodluck Jonathan said he annulled the deal because “due process was not followed in the award of the contract”.

Manitoba was supposed to start work at the beginning of September but transmission is still in control of the government. The head of the Manitoba-run Transmission Company of Nigeria, Don Priestman told Reuters  that they had a clear contract and were meant to be given delegation of authority but “there are forces working against reform.

In an attempt to explain the cause of the canellation of the contract, the Special Adviser to the President on Media and Publicity, Dr. Reuben Abati told Punch that the contract was awarded by the the Bureau of Public Enterprise (BPE) who did not follow due process.

The BPE has no power to approve a management contract, according to the provision of Section 16 sub section 4 of the 2007 Public Procurement Act. That section says that the BPE must obtain a certificate of no objection from the Bureau of Public Procurement.

“Another section of the Act says that certain contracts must be approved by the Federal Executive Council. The management contract in question is $23.6m, which is above the approved threshold of BPE. The vice-president is a member of FEC. For the BPE to go ahead and approve that contract simply means that due process was not followed. It is a matter of due process, a matter of best practice; it is not a personality matter. The infraction was committed by the BPE.”

It is sad that the Presidency is just realizing the BPE did not follow due process several months after the contract was awarded. When BN first reported news of the contract in April {click here to read it}, many had doubts about the contract. Now, instead of moving forward on the privatisation process, we have taken a major step backwards while our organisations and industries continue to groan under the implications of epileptic power supply. This move also puts Nigeria in a bad light as international companies might no longer take us serious since we have shown we cannot honor  an established contract. It is indeed a big blow to the power reform.


28 Comments on A Major Setback in the PHCN Privatisation Process: Presidency Scraps Contract to Canadian Power Transmission Company
  • Ginika November 15, 2012 at 7:23 am

    What can one say?

    I am just upset.

  • dipo November 15, 2012 at 7:36 am

    this is just politics at work,why award a contract without checking if due process was initially followed.these people try to make their work seem so difficult

  • Anon November 15, 2012 at 8:11 am

    This disgrace called Nigeria…everything is just wrong with this country. it sucks massively…

  • timi November 15, 2012 at 8:34 am

    we need to riot against forces of darkness

  • Teeenaaa November 15, 2012 at 8:42 am

    Jst wen we thought it was gerrin better!! chaii Nigeria wen will d issue of power supply end?? hiannnnnnnn

  • diamond November 15, 2012 at 8:50 am

    ehen! They have started. First, it was barth nnaji. now it is canadian firm. may God help us all.

  • olori November 15, 2012 at 8:52 am

    why is nigeria bent on staying backward ! because dey didn’t follow due process? since wen did dat become an issue…its obvious jonathan is a zombie…they did’t follow due process bt are close to delivery …..and then u call it off smh

  • Afam November 15, 2012 at 9:03 am

    Why can’t we ever do things right in this country. This is seriously a set back…www.nigeriakwenu.com

  • Teris November 15, 2012 at 9:15 am

    “…It is sad that the Presidency is just realizing the BPE did not follow due process several months after the contract was awarded…. When BN first reported news of the contract in April…. many had doubts about the contract…”

    it is even sadder that the doubt is being justified. naija, suprise we na!!
    this is not an issue that cud not have been straightened out internally tay-tay internally.

  • Agbaya November 15, 2012 at 9:17 am

    Where do we go from here? Just when i thought things would start working for our good in Nigeria….. May God punish all the wicked powers dat say we wud continue in this suffering.

  • Idak November 15, 2012 at 9:23 am

    If you’ve been following BussinessDay expose on the power projects, you’ll easily predict this. The corruption and power play in that sector make Ifeanyi Ubah/Cosmas Maduka drama seem like child’s play. The insincerity in governance in this country is mind blowing. Reuben Abati can speak all the grammar he can but the truth is that the Barbarians have taken over the city centre.

  • Oluwabunmi Abode Viv November 15, 2012 at 9:25 am

    Only God knows if this country will ever progress

  • Thelma November 15, 2012 at 9:36 am

    Just sad. When will we get things right in this country? Why announce the contract without first vetting the process? Confusionists and opportunists, that what they all are.

  • Nigerians are suffering November 15, 2012 at 10:06 am

    What is wrong with our leaders.We are going to get positive results in a couple of months then u cancel it because they did not line the pockets of the ‘CABAL’

  • Teeenaaa November 15, 2012 at 10:16 am

    hahhhahahahah@ olori, jonathan is a serious zombie ooooooo

  • ruth November 15, 2012 at 10:21 am

    i wonder what maters d most?is it due process or consumer satisfaction?i thought our dream was a better nigeria?whats GEJ upto?

  • ima November 15, 2012 at 12:31 pm

    its well

  • e-bukun November 15, 2012 at 1:53 pm

    So what happens to the money spent thus far? smh

  • nich November 15, 2012 at 2:24 pm

    if it was a nigerian company, nobody will mention due process. this same canadian company manitoba manages the electricity for the kenyan government. at least we know that they are a credible company. kenya enjoys electricity and see nigeria.
    those who believe that nigeria will make it can continue to hope on hope.
    i thank God i and my brothers and sisters made the decision long ago to leave this forsaken nation and God blessed our wish.
    what is the hope for a young man in nigeria?,,,,,,,,,,,,,,,,i thank God that i never believed in this country as soon as i turned 12yrs old and now as an adult my suspicion about this country has always been right.

  • grac e November 15, 2012 at 2:57 pm

    Jonathan u r a complete failure to mankind. You don’t realize how much power you posses as the president and you keep allowing people ride over you. We never follow due process ever in Nigeria so since when did that become a problem?

  • hmm November 15, 2012 at 3:05 pm

    After messing this up..which country would take Nigeria seriously now ?

  • nich November 15, 2012 at 3:08 pm

    nigeria is ranked 120 that has the worst roads in the world out of 140 countries in the world


    nigeria as of today was ranked second most corrupt nation…..http://pmnewsnigeria.com/2012/11/14/nigeria-2nd-most-corrupt-nation-gallup-poll/?utm_source=dlvr.it&utm_medium=twitter

  • feisty chic November 15, 2012 at 6:46 pm

    the truth is that some people that were meant to have been settled have not been. so until the company settles them, no show. I wouldn’t be surprised when we would hear soon that the company has been given the go ahead to start business. I am still so happy I didn’t vote for the puppet at the helm of the country’s affairs.

  • Ajoke November 16, 2012 at 1:49 am

    Disgrace, kinda saw it coming though…

  • Abel D.Kwasau November 21, 2012 at 10:25 pm

    President Jonathan needs deliverance by God Almighty from the hands of his political kings makers. May every Nigerian say Amen.

  • Abel D.Kwasau November 21, 2012 at 10:43 pm

    Mr.President sir, what is wrong with you? Don’t you think you need a Psychologist the way and manner you are running this country? If that is how you want it, mind you, your grand children curse you even in hell no matter the trillions you keep for them. Pls sir, consult a psychologist for a rethink.

  • ilenmi moses June 3, 2013 at 6:25 am

    dis conutry is too bad

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