KEY POINTS
- Delta lawmakers approve new N18.1 billion bank guarantee to facilitate Asaba power project.
- Access Bank replaces Sterling Bank as guarantor under the state’s revenue-linked energy deal.
- The project aims to boost electricity supply and industrial growth across the state.
The Delta State House of Assembly has granted approval for a new N18.1 billion bank guarantee in favour of Bastanchury Power Solutions Nigeria Limited, the developer of the Asaba Independent Power Plant, marking a crucial step in the state’s long-term plan to enhance energy supply and industrial development.
The approval followed Governor Sheriff Oborevwori’s request to replace the existing Sterling Bank guarantee with a fresh one from Access Bank Plc.
The decision, read before the Assembly by Speaker Dennis Guwor, was unanimously adopted after being moved by the House Leader, Emeka Nwaobi, and seconded by the Deputy Speaker, Arthur Akpowowo.
Oborevwori explained that the re-issuance was necessary to facilitate Access Bank’s partnership with the state government in managing Delta’s composite Internally Generated Revenue (IGR), a reform intended to improve efficiency and ensure better financial performance.
Bank Guarantee Shift to Strengthen Energy Partnership
The governor noted that the existing IGR account is already tied to a Sterling Bank guarantee exceeding N18 billion, issued earlier on behalf of Bastanchury Power under the Asaba Independent Power Purchase Agreement (PPA). Under the PPA, the state government bears two key obligations: an annual bank guarantee covering compensation payments and buy-out clauses valued at N18.1 billion, and a monthly irrevocable standing payment order of N430.7 million subject to a 2.5 percent yearly increment to cover the plant’s operations, capacity, and maintenance costs.
Oborevwori said the State Executive Council had approved the transition to Access Bank’s facility to ensure smooth continuity of the project’s financing structure. Once the new guarantee is issued, the Sterling Bank facility will be cancelled. “The arrangement ensures a seamless transition and sustained partnership with Access Bank to manage the IGR-backed commitments,” he added.
Power Project to Drive Growth and Energy Reliability
The Asaba Independent Power Project forms part of Delta State’s broader infrastructure drive to expand electricity generation, stimulate industrial activity, and support private-sector investment. When completed, the plant is expected to provide stable power supply to key public facilities and manufacturing clusters in and around Asaba, the state capital.
The assembly’s endorsement represents a milestone for Governor Oborevwori, who has sought to reinforce the state’s fiscal credibility through transparent financial management and consistent payment of obligations.
Earlier this year, he approved N10 billion to clear pension arrears, bringing total pension payments under his administration to over N36 billion, while maintaining a monthly outlay of N1.4 billion for retirees.
