Dangote to build three coal power plants for cement factories
Dangote Group is to establish three coal fired power plants, one each for its cement plants in Obajana, Kogi State, Ibese in Ogun State and Gboko, in Benue State. The Managing Director, Dangote Cement, Devacumar Edwin, who spoke yesterday in Lagos, said the Group is investing S250million to build the power plants, adding that the first consignment of coal has already been imported from South Africa.
He said the decision to refocus and address the power situation in this manner, was informed by the worsening situation of power supply, occasioned by continuous drop in gas supply to power generating stations.
He said: “As you know, the gas and the fuel oil supply situation is going from bad to worse every day and all the manufacturing industries and all the power plants are affected. “
Edwin said the danger exists right now about the capability of the power generating stations being able to settle their obligations to the banks because of the difficulties they are experiencing as a result of the challenges arising from inadequate gas supply.
According to him, the private companies that bought the power plants and the banks that provided the credit to them are complaining that the situation is challenging.
He said: “If you talk to most of the banks that have provided most of the finance, their concern is that they will have to go back to the Assets Management Corporation of Nigeria (AMCON) to recover their investments because many of the power firms are unable to pay. To continue to hope without taking action will amount to watching one’s investments go down the drain.”
He said although the gas firms did well in the past by supplying about 90 per cent of the energy needs of manufacturers, especially in the Lagos sector, the situation has since deteriorated.
Edwin said: “You go invest in power plants and you can’t get gas, so your entire investment has gone awry. If we don’t have gas and fuel, no business can survive. For our industry, you can go and invest in the best of equipment; you can get the best of skills to operate the equipment, but if you don’t have power, there’s very little you will be able to do.”
He said the Dangote Group’s investment in coal fired plants will give the company “a lot of relief. This is a massive investment we have adopted.
“We are trying to be proactive because if we keep slacking, nobody will come to our aid. So as much as we are going to appeal to government for help, we have made investment so that our business will continue to thrive.”
He said the Group’s investment in coal has created opportunities for the sector, adding that the move will reduce the company’s cost of production, promising that the conglomerate is working on a strategy to begin using locally sourced coal with time.
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