FG gets 30 percent on PHCN debts settlement

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Much ado about stranded 4,000Mw of electricity

The Nigeria Electricity Liability Management Company (NELMCO) said it has secured 30 percent discount  on the settlement of every N5million debt owed by the Power Holding Company of Nigeria  (PHCN ).

It said with the adoption of some management models, it has been able to save the Federal Government a total of N91billion of the N914 billion debt repayment.

Its Managing Director, Adebayo Fagbemi disclosed this at the Presentation of Self-Assessment Tool (SAT) Report and a Plague to the Management in Abuja.

Giving the breakdown, he said since NELMCO has no seed fund for its operation, it develops different models that would enhance due diligence for managing government’s liabilities.

He said the company invented the Triangular Verification Model (TVM) which saved N89 billion through Distance Soliciting Window and another N1.8 billion that amounted to N91billion.

According to him, the outstanding liability is N400 billion.

His words: “What I did say is that we developed a model the TVH Triangular Verification Model. As you aware we inherited distanded  debt of the entire defunct PHCN which amounted to almost 914 billion and that model we put in place  to enable us conduct due diligence on the inherited debt arising from that model.

“This is because we don’t have sufficient funding NELMCO started without any seed fund from the Federal Government. We have to develop that model as the best way of managing this liability on behalf of government. “The agency is a special purpose vehicle so we have to go to our thinking box on how to manage these debts without require funding.

“From that model we were able to save N89 billion naira for the Federal Government and through the Distance Soliciting window we saved another  N1.8 billion and when you add that up we are talking of about almost N91 billion.”

He revealed that the company has a forecast to wind down its operation by 2022.


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