PHCN has debt burden of over N319b

The Power Holding Company of Nigeria (PHCN) has a debt burden of over N319 billion.

Sam Agbogun, managing director of Nigeria Electricity Liability Management Company (NELMCO), disclosed this in an interview with the News Agency of Nigeria (NAN) in Jos on Wednesday.

Mr Agbogun, whose company is saddled with the responsibility of managing the debts, said that the company owed N72.6 billion in unpaid power purchase agreements with many private power generating outfits.

He said a further breakdown of the debts showed that PHCN owed local financial institutions N48 billion, while its foreign counterparts owed N2 billion. The PHCN owed N37 billion in legacy debts.

He said that some engineering companies were owed N39 billion, while N40 billion and N15 billion were loans from some foreign governments and federal government respectively.

Mr Agbogun said that PHCN Superannuation Fund was being owed N13 billion, while the PHCN owed N36 billion to the PHCN’s Pensioners provisional Buy-out.

He said that other debts include the N18 billion PHCN pensioners’ monthly pension, adding that the total debts were rising by an average of N8 billion every other month.

Mr Agbogun said that many other charges were accruing to the debts on daily basis.

He said that there are other liabilities whose monetary value are still unclear and listed them to include environmental liabilities that could constitute major worries to investors from western countries.

According to him, other liabilities include contaminants in the form of dielectric fluids in transformers and capacitors, adding that the studies had shown significant presence of such contaminants in the PHCN transformers.

Mr Agbogun listed other liabilities to be assessed as emissions discharged into water and the third party claims from states and local governments, corporate institutions and individuals with investments in infrastructure used by PHCN.

He, however, listed PHCN’s assets to include the three PHCN properties in London, Kainji Motel, buildings in Abuja and Lagos as well as the zonal offices in Ikeja, Ibadan, Enugu, Kaduna, Jos, Kano and Yola.

Others are the PHCN Golf Courses at Shiroro and Kainji, a bonded Customs warehouse at Apapa, Lagos and a workshop at Ijora.

Mr Agbogun said that some of the assets to be disposed of to settle some of the debts include undeveloped plots across the country, unsold staff quarters and PHCN medical centres in Abuja and Oshodi.

The official said that the basic assessment of the assets showed that about N61.5 billion would be generated from some of the sales.

“It is, therefore, clear from the records that even after all the assets are disposed of, there will still be N244 billion left for the federal government to settle.

“This is why our assignment here is very daunting,” he said.

To effectively carry out the assignment, Mr Agbogun said that NELMCO would engage professionals to provide consultancy and advisory services, especially in the negotiations to buy out life pension with PHCN pensioners.

He said that the debt managing outfit would also engage relevant ministries and departments to assist in the verification, reconciliation and concessions of PHCN’s liabilities and assets.