The Executive Director, First City Monument Bank (FCMB) Capital Market, Mr. Tolu Osinibi has said that the financial institution committed to the development of the Nigerian power sector.
This, according to a statement from the bank at the weekend, was demonstrated in its participation in the financing of the Accuga Limited deal.
Accugas Limited, a wholly-owned subsidiary of Seven Energy, recently closed on a $225 Medium Term Project Finance Facility for its Central Processing Facility (CPF) and second gas pipeline project in Akwa Ibom.
The proceeds of the landmark transaction would be used for construction of the CPF and gas pipeline to provide gas to Ibom Power, located In Akwa Ibom and NDPHC’s Calabar power plant located in Cross River.
The project, which is scheduled to be completed in 2014, would fulfill the gas supply contract obligations to both the Ibom and Calabar power plants the objective of which is to satisfy the growing gas demands from power plants and industrial users, following the ongoing reforms in the power sector.
FCMB Capital Markets Limited, one of the Mandated Lead Arrangers (MLA) for the Facility, was also mandated as technical bank with Stanbic IBTC Plc.
Osinibi explained: “The technical bank team ensured that all the technical issues related to this novel project have been identified and addressed and that he is confident that the project will be completed on schedule and it will add significant value to the country’s power generation capacity”.
Osinibi further commended the efforts of the technical bank team in ensuring due diligence in the transaction was timely concluded.
On his part, the Vice President, Project and Structured Finance, FCMB Capital Markets, Mr. Robert Grant, described the facility as a landmark transaction, which supports the federal government’s gas-to-power initiative of providing gas to existing power plants to immediately increase total output.
He pointed out that “this further demonstrates that private sector investments will be instrumental to further development of the Power Sector Reform value chain post the Bureau of Public Enterprises privatisation exercise”.