FEDERAL MINISTRY OF POWER, WORKS & HOUSING

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Latest Press
18 January, 2018

FEC Approves Projects in Water, Aviation and Power Sectors

The Federal Executive Council (FEC) has approved N3.7 billion for the rehabilitation of Kazaure water project and N656 million for upgrading of obsolete Flight Safety Laboratory and framework for investment in the nation’s power sector.

Minister of Water Resources, Alhaji Suleiman Adamu, who alongside the Minister of State for Aviation, Sen. Hadi Sirika, and the Minister of Power, Works and Housing, Babatunde Fashola, made this known while briefing State House correspondents on the outcome of the Council’s meeting.

He said the Kazaure water project which was started in 1997 and abandoned in 2000 would soon be resuscitated under the on-going Federal Government’s programme of resuscitating all irrigable land across the country.

Minister of State for Aviation, Hadi Sirika, said that the upgrading of the flight laboratory was necessitated by the fact that the equipment which was established in 2012 had become obsolete.

Babatunde Fashola, the Minister of Power, Works and Housing said the Council approved a framework of investment at the 33KVA and 11KVA line in expanding the national distribution network, to deliver an extra 2000Megawatts of electricity (to consumers) which is currently not getting to the grid.

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Power Sector Liquidity: FG Commits N702 Billion To Nbet To Meet Payment Obligations * Says it is part of its Economic Growth and Recovery Plan to take the nation out of recession * It is in recognition of the critical role that energy and access to electricity play in economic growth and poverty reduction – FG * Subsequent interventions to strengthen financial transparency and discipline, attain and sustain generation, transmission and distribution above 4,000 MWh/h, among others As a first step towards solving the debilitating liquidity problem in the Power Sector, the Federal Government is committing up to N702 Billion to the Nigerian Bulk Electricity Trading (NBET) to enable it meet its payment obligations to Generation Companies (GenCos) on a more regular basis to ensure delivery of electricity across the country The commitment under the “Payment Guarantee Support to NBET”, scheme takes retrospective effect from January, 2017 and would enable the government-owned NBET to pay its obligations to the GenCos and through them to their gas and equipment suppliers, banks and other partners. According to a Communiqué issued Friday by the Ministry of Power, Works and Housing, the Federal Government intervention, which represents a critical element of its Economic Growth and Recovery Plan, is part of the far-reaching steps taken by the Federal Executive Council (FEC) on Wednesday, March 1, 2017, to reset the electricity industry in view of “the critical role that energy and access to electricity play in economic growth and poverty reduction”. It is also to provide payment assurance to electricity generation companies, improve financial liquidity in the power and banking sectors and ensure the provision of electricity to households and businesses to boost economic growth, job and wealth creation, the Communiqué said. Recalling that the Commissioners of the Nigerian Electricity Regulatory Commission (NERC) was recently inaugurated to provide government with “the requisite legal and regulatory framework to implement its credible recovery programme,” the Communiqué said the steps, “conceived within a sequence of sector reforms”, represented Government’s commitment to enforcing decisions taken as a nation to move from a wholly Government-owned to private sector led electricity industry. “These steps, conceived within a sequence of sector reforms, confirm Government’s commitment to enforcing decisions taken as a nation to move from a vertically integrated Government owned statutory monopoly that did not serve our power needs, to a private sector led industry-with Government as guarantor, regulator and policy maker–that achieves the objective of developing a better and sustainable power sector as quickly as possible”, the Communiqué said. Assuring that Government, in collaboration with NERC, would continue to work with the DisCos to improve their payment performance from the current 24.9 per cent level, with the 100 per cent target, the Communiqué said subsequent complementary interventions would seek to strengthen financial transparency and discipline to ensure that all industry revenues were fairly distributed to all market participants and their suppliers according to contractual commitments. Subsequent interventions, the Communiqué also said, would seek to achieve and exceed the contracted and committed ATC&C loss targets and sustain aggregate collection efficiency above 60 per cent as well as secure adequate capitalization and liquidity to ensure that all market participants, particularly those upstream of the DisCos, were paid according to contracts and were adequately funded to sustain and expand their operations. Other objectives subsequent Government interventions would seek to achieve include attaining and sustaining generation, transmission and distribution above 4,000 MWh/h delivered to customers, from lowest cost base load GenCos by deploying and/or facilitating new generation using all available energy sources. Government will also seek to recover lost gas supply, add new gas supply, and complete transmission projects curtailing generation particularly in the eastern part of the national grid, the Communiqué said adding that through wider consultation, government would implement a simplified tariff methodology that would accurately reflect market realities, exchange rate realities, and the cost of producing and delivering electricity. Acknowledging, however, that the plans alone would not solve all the problems of the Power Sector, the Communiqué said they were, however, conceived “within a package of measures” to ensure that the electricity system continued on a steady trajectory of growth, better service delivery and a climate where investors who played by the rules set by NERC and deliver results that benefit the consuming public were compensated appropriately. It recalled that NERC licensed eleven distribution companies (DisCos) to distribute and sell electricity with the Private Sector owning 60 per cent while Government retained 40 per cent shares of the companies adding that Government also established NBET, 100 owned by it, to buy electricity in bulk from electricity generating companies (GenCos) licensed to produce electricity. “The intention was that while the DisCos take the time necessary to improve and expand their networks of substations and lines, enumerate and meter their customers, buy additional power directly from GenCos and provide better customer services, the existing and new GenCos could confidently make investments to expand generation with assurance that the bulk buyer would pay them for the electricity they deliver”, it further explained adding that Government retained ownership, for the time being, of the transmission system used to transmit the electricity from the GenCos to the DisCos. It said, however that the DisCos have not improved customer services at the pace Government and the country would expect and also were not paying fully for the electricity they received from the GenCos through NBET adding, however, that some of the reasons for the failure were not the fault of the DisCos alone. According to the Communiqué, “Regulatory and tariff inconsistencies of the past administration, unexpected changes in the foreign exchange market, and lower than expected generation due largely to pipeline vandalization for example, have challenged the DisCos’ ability to perform. But much of the failure relates to their inadequate financial and technical capacity and some sharp practices of the DisCos in their administration of collections from customers”. Explaining the reason for government intervention, the Communiqué said as a result of the aforementioned inadequacies, NBET’s monthly collection from the DisCos was not enough to pay NBET's contractual obligation to the GenCos resulting to huge government debts adding that in recent months the payment by the DisCos to NBET was as low as 17.0 per cent of NBET's invoice. “In January 2017, it was 24.9 per cent. The GenCos in turn do not pay their gas suppliers, equipment suppliers, banks and other partners what they are contractually bound to pay. The DisCos also do not pay TCN what is contractually due to it for transmitting the energy the DisCos sell to consumers”, it said adding that these had resulted in payment shortfalls with the accumulated debts increasingly threatening the electricity supply system and undermining the growth of the economy and the electricity sector. The Communiqué read in part, “In recognition of the critical role that energy and access to electricity plays in economic growth and poverty reduction, the Federal Government of Nigeria (FGN) as part of its Economic Growth and Recovery Plan, at its Federal Executive Council meeting of 1st March 2017 has taken far-reaching steps to reset the electricity industry”. “These steps, conceived within a sequence of sector reforms, confirm Government’s commitment to enforcing decisions taken as a nation to move from a vertically integrated Government owned statutory monopoly that did not serve our power needs, to a private sector led industry –with Government as guarantor, regulator and policy maker–that achieves the objective of developing a better and sustainable power sector as quickly as possible”
7 March, 2017
7 March, 2017
FG Has Kept Its Promise To Restart Nation’S Economy Through Infrastructure Development – Fashola * Says in every state of the Federation there is now one project or the other going on * A clear government policy on the way to ensure steady supply of gas to power plants being evolved * Housing programme at proof of concept stage with contractors already working in 30 states * Advocates support for the government in order to achieve the desired change The Minister of Power, Works and Housing, Mr Babatunde Fashola SAN, at the weekend in Lagos reviewed the performance of his Ministry in the last one year asserting that the promise at inception to restart the economy through infrastructure development was being met in all the sectors under his charge.  Fashola, who spoke in Lagos at the Nigerian Economic Outlook – 2017 Conference organised by BusinessDay Newspapers with the theme, “The Emergence of Green Shoots?”, said in every state of the Federation today there was one project or the other going on and engendering the distribution of wealth as lost jobs were being regained while new ones were being created. Beginning from the Works Sector, Fashola, who recalled that in his inaugural press briefing he promised to restart the reconstruction of major roads to reconnect states, pointed at the ongoing reconstruction/rehabilitation works on Federal roads and bridges across the country as evidence of the fulfilment of the promise. “Today, you see roads from Sokoto  to Ilela-Tamburawa, to Benin-Okene, Ilorin-Jebba, Kano to Maiduguri crossing five states, Calabar to Akwa-Ibom crossing two states, Lagos-Ibadan crossing three states, Enugu-Port Harcourt crossing five states, Enugu to Onitsha crossing two states, and in every state of this Federation there is now some road work going on”, the Minister said. Also recalling that he promised that through that initiative lost jobs would be recovered, the Minister, who said the plan was to create more jobs, said, however, that by the time the economy was restarted the first thing that resulted was to recover lost jobs adding that in all the construction sites today, the story by the workers was “our employer has recalled us”. “We promised that through this process we would legitimately redistribute the wealth of the nation and we are doing that as well; because now, drivers are back to work and they get paid for work done. People are vending, people are quarrying, trucking cement. So once that contractor is paid in my Ministry, the wealth distribution process starts until it gets to the Mama-put in the site of the construction yard”, he said. Recalling also his promise that through the programme, journey time experience would be improved by first of all shortening journey time and then improving travel experience, Fashola declared, “Make no mistake; the work is not finished; but if you have driven on those roads you have a relatively better story to now tell”. The Minister, who said he was also “monitoring and collecting data in a more scientific approach rather than these personal testimonies”, said the exercise would help him “know where we are gaining on our promises and where we need to bolster up”. He was also going round, he said, “to go and see what is happening” and periodically at the Federal Executive Council, projects that have been approved for procurement were announced adding that recently FEC approved 11 roads while last Wednesday, one bridge between Nigeria and Cameroun joining the Enugu-Abakaliki Highway, was approved. Also, according to the Minister, the Kaduna Eastern Bypass was approved to reduce the pressure on the Kaduna Metropolis and improve journey time for people going on to Zaria. He declared, “And this will not stop as long as the budget is passed”. Fashola said all the projects were made possible “because President Buhari as the captain and the Vice President and the Minister of Budget and Economic Planning understand the need to increase the infrastructure spend”, adding that although N7Trillion looked like a lot of money, it was small considering the enormity of the problem at hand. “But it is enormous when compared to where we were coming from”, he said adding that he got a budget of over N200Billion in 2016 for Works, for roads, compared to N18 Billion in 2015. “That is the context; from N18Billion to N260 Billion, that is the context”, he said. Fashola also said his promise to achieve constant power supply in the country through Incremental Power in the short term to Steady Power in the medium term and Uninterrupted Power in the long term was also yielding results, pointing out that soon after that promise the nation attained 5,000Megawatts for the first time but lost a substantial part of it a few months later through gas pipeline vandalism. The Minister, who regretted that such sabotage should happen because some Nigerians were angry, however, said the National Grid climbed back to about 4,217MW early last week but lost about 800MW again by Thursday last week due to another pipeline burst at Rumuji in Rivers State adding that efforts were being made to put it back. According to the Minister, while all these were going on, the transmission line was being expanded and could now carry a minimum of 6,500MW and a maximum of 7,000MW of electricity adding that the talk about the transmission line being able to carry only 5,000MW was false. Blaming the current challenges in electricity supply to the fact that the nation depends largely on gas to the neglect of other sources of energy that are also available in the country, Fashola said his Ministry has also developed an Energy Mix anchored on renewable energy sources such as Solar and Wind energy adding that the plan of government was to achieve 30 per cent of renewable energy by 2030. He said the government has since signed a power Purchase Agreement with 14 Solar Energy providers to supply 1125MW to the grid adding that there was also a conceptualisation of a massive close to 2,000MW, subject to design in Jigawa State which, according to him, would be modelled after the Moroccan experience in Marrakesh. A piece of land has already been allocated while a team has started work on the project, he said. In addition, he said, the Ministry has commissioned a 1.2MW solar plant to power the Lower Usman Dam Project in Abuja while work is going on also in several other projects across the nation such as the 10MW Wind Farm in Katsina, the 700MW Zungeru Power Plant which may be delivered in late 2018 or early 2019 as well as the Azura Power Plant where work has resumed after years of court cases. Noting that all these projects were meant to achieve Incremental Power which he promised in the short term, Fashola, who said government was also working assiduously to solve other challenges such as liquidity, distribution and metering, added that Government would soon announce a clear policy that would secure payment to Generation Companies to enable them pay their suppliers and restore confidence in the sector. In Housing, the Minister recalled that he promised a National Housing Implementation Programme so that the nation would achieve its National Housing Policy which, since 2012, promised to deliver affordable housing adding that his Ministry has evolved a programme that would address acceptability of what was given to the end users. Pointing out that past Housing programmes were carried out without sufficient consideration to cultural and climatic diversities in the country, Fashola added that this had created acceptability gap. “But the Ministry has now conceived designs which are going to initial proof of concept stage where contractors are already working at 30 states of the country at the moment”, he said. “Later in the year we will come back to share the results of what we have seen”, the Minister said adding, “It is only when we have national acceptability that we can then roll out the commodity large scale and that is where the Private Sector becomes our partner in delivery; we will become the off taker through the Federal Mortgage Bank, issuing mortgage to people and giving an effective purchasing capacity through mortgage”. Advocating total support for the present administration as the only way for the nation to achieve the Change objective which they voted for, Fashola, who likened the government to a football team argued that since Nigerians chose the team themselves because of their desire to change what they did not like, they were morally bound to support that team and urge it on to achieve the desired change. Speaking on the topic “Infrastructure Spending as a Strategic Tool for Economic Recovery and Growth”, the Minister, who rhetorically posed the questions as to why Nigerians elected the present government and what they expected from the government, declared, “Don’t give up on your team. That is why you voted this government, we all wanted a Change”. Fashola, who recalled that the component of Change, as campaigned by the administration, was embedded in three promises; Security, Corruption and the Economy, pointed out that although issues of insecurity were global, the one that bothered the nation most was terrorism. “That was the front burner issue; has this government contained terrorism; you answer that inside you honestly”, he said, adding that although the scourge of corruption was self-inflicted the present administration has demonstrated, more than any other government the resolve to fight the menace.  “Now, in the face of the prosecutions, the arrests and some of the evidences that are beginning to come out, is this government walking its talk?”, he asked adding “You just ask yourselves honestly; because this kind of arrests was not made before this government”. “Nigeria had a lot of money, oil was selling at $100/barrel, billions of petro-dollars; where did the money go? I tell people, Burj Khalifa, the Dubai showpiece to the world, cost $1.5billion to build. We made more than that kind of money; Google it. What did we do with our own dollars? So that was what you wanted to change as well”, he said. Fashola noted that in the process of fighting corruption, some people had also taken the mantle to fight government making unsubstantiated allegations against evidences being presented in court by those determined not to let the fight succeed and would bring down anybody’s reputation in order to achieve their purpose. While assuring that Government would implement the 2017 budget as well as the recovery plan, Fashola recalled, “The economy that you wanted to change was investing 15 per cent in Capital Expenditure and was recording all sorts of growth”. “But you kept saying it was a jobless growth, you said it. It was in every newspaper headline; “Growth Not Inclusive”. That was what you wanted to change”, the Minister said adding that the present administration has changed all that by increasing capital expenditure to twice the 2015 amount for the same purpose. According to him, “Now, you have heard from the Budget Minister, working with his President and the Vice President increasing, slowly but surely, with dwindling resources, the Capital investment that is going into infrastructure; that presentation has been made’’. “At the time when we had $100 per barrel we were budgeting 15 per cent, we were budgeting N4 Trillion and our number was growing. Now, at the time that we have less money, we are budgeting almost double of N4 Trillion and spending more on the Capex. That is the hard road that we have to walk but it will be a road worthwhile if we persevere”, Fashola said. Still on the economy, the Minister, who argued that it was important to know where the nation veered into recession in order to successfully chart a course out of it, recalled that during the period of under-budgeting, roads were not built while contractors were not paid for three to four years. As a result, he said, the construction companies started downsizing both human and resources and equipment and in the process many artisans, drivers, welders and other construction workers lost their jobs and means of livelihood and so money ceased to flow down as even indirect employees like food vendors and suppliers also lost their jobs. Fashola, who noted that economy started contracting four years ago, pointed out that immediately the free money from oil tapered out, the result was recession adding that it was important to understand how recession came in order to know how to get out of it. “And I speak only to the facts and not as personal opinion; these are the facts, and I think this audience can engage with the facts and the truth”, he said. Also noting that if the understanding of how the nation got into trouble was collectively understood there would be united purpose on how to get out of it and the critical role everyone had to play, the Minister pointed out that global economic slowdown also played a part in the economic recession adding that both China, Japan, Saudi Arabia and other big economies experienced it in one form or the other. The Minister said one of the steps taken by President Muhammadu Buhari to restart the economy was to cut down on public spending by reducing the number of Ministries adding that as a Minister in charge of Power, Works and Housing, he, along with a Minister of State were now managing the three-in-one Ministry hitherto supervised by five people. According to him, “President Buhari compressed 42 Ministries to 24 and he told all of us then that if he had his way he would have stayed at 24 but the Constitution says there must be one Minister from each of the 36 states. So it is important that we just begin to locate our contexts as we deal with these issues”. On the role of the Private Sector operators in the economic recovery plan of government, Fashola urged them to invest in the Government Bonds when they would be issued adding, “We need the money; I think that is where you are more prolific”. The Minister also emphasized the need to play by the rules, expressing dismay that the roads constitute the major area where people break the rules building their businesses within the Right-of-Way on the highways. He cautioned those concerned to relocate voluntarily or risk being forced out. “We need those businesses but they must be built outside and not within the Right-of-Way. It just denies other people the opportunity to use the assets built with their money. Those of us who are involved in haulage business for example must set up proper stabling yards for our trucks”, he said adding that it was a Private Sector issue. Still on rules, Fashola frowned at the practice by Petrol tanker drivers who, according to him, exceed the approved capacity by 100 per cent loading 60,000 litres instead of 33,000litres of fuel adding, “This is flouting of the rules”. Noting that the ECOWAS Commission has notified Nigeria as the only country in the sub-region that is still not enforcing the Absolute Compliance, Fashola declared, “So be sure that we are going to restore weighbridges. We are going to build warehouses next to them; we are going to offload that excess cargo. You are going to pay penalties for them because that is what happens all over the world, those are the rules”. “So what I need us to do is just to play by the rules. It won’t be Christian and Muslim, it won’t be North and South, it won’t be geopolitical zones; just rules and we will be a happier people if we play by the rules”, the Minister said. The Minister also said the Private sector could bring more efficiency into the over 60 per cent of the power assets within their management because that was why the privatization took place in the first place adding, “We wanted to see your efficiency and power of implementation and that would be helpful in terms of what could be done to support us to deliver”. He also urged the larger members of the Private Sector who don’t own power assets to pay their electricity bills “if they are fair because I know that there are disputed bills” adding that they should use existing dispute resolution mechanisms-the Consumer Centres-instead of going to court. Reiterating that the economic situation could be overcome if only Nigerians could deploy their resilience to use he declared, “It is only resilient people that can make determination come true in the face of daunting realities”, adding, “Now I couldn’t think of more resilient people than Nigerians. It is a strength that we have not projected proudly”. The well-attended BusinessDay Economic Summit 2017 also featured the Minister of Budget and National Planning, Senator Udoma Udo Udoma, who made a presentation on “Key Pillars of the 2017 Federal Budget, and his Industry, Trade and Investment counterpart, Dr Okey Enyinna Enelemah, who also gave a presentation on “The Impact of an Improved Investment Climate In Attracting the Needed Private Capital for Sustained Growth”.  
1 March, 2017
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OTHER NEWS
16 January, 2018

Federal Ministry of Power, Works and Housing
Public Procurement Department (Power Sector)

Re - Request for Quotation

The Federal Ministry of Power, Works & Housing (Power Sector) hereby wishes to inform the general public and the contractors who responded to the REQUEST FOR QUOTATION on (SUPPLY OF ITEMS AND SERVICES) earlier issued via our On-Line portal, dated Thursday 8th December, 2017 as extended is hereby stepped down by the Ministry.

2.    This decision was taken due to some difficulties experienced in our On-Line procurement network and web platform; this caused some stalemates which considerably negated some procurement ethics and the due confidentiality the Ministry seeks to advance.

3.    The Ministry sincerely regrets any inconvenience this decision may have caused the public and the Bidders/Contractors. This action taken by the Ministry is to ensure probity and better service delivery.

4.    Interested contractors are hereby informed that the stepped down procurement shall be repeated among the first round of our procurement Notices/Request for Quotation in the Month of January, 2018.

5.    Thanks for your patronage.

Signed
Permanent Secretary

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Speeches
9 January, 2018

Remarks By Babatunde Raji Fashola, SAN At The 23rd Monthly Power Sector Operators Meeting Held In Lafia, Nasarawa State, Monday 8th January, 2018

I will like to start this my remarks by highlighting the Progress and milestones on our journey for incremental power which reassure us that we are on the right path and inspire us to continue with more belief.

Those milestones are represented by:
a. Generated power has gone up to 7000 MW in 2017 from 3,000  MW in May 2015
b. Transmission Capacity at 6900MW in 2017 from  about 5,000  MW in May 2015
c. Peak Distribution now averaging 5,000 MW in 2017 from 2,690MW in 2015.

That said I will like to thank all of you for your contributions towards these milestones.

The reason I thank you is because you are impacting the lives of Nigerians, you are saving them money and changing their lifestyles for the better.

They tell me that their consumption of diesel and petrol to run generators for power has reduced and the hours they run their generators has gradually reduced.

This is the result of incremental power and we must get more of it.

They also tell me that they are now monitoring how they use power and are turning off appliances that are not needed.

Although this is meant to save costs, it also conserves energy, reduces waste and supports incremental power.

In the last 3 months we have increased the supply of power in the dry weather and people’s experience with power was better.

We must thank the Ministry of Petroleum  Resources for the increase in gas supply .

The cynics who used to say that it is only during the rains that power improves now see that what we have done is no fluke.

Apart from Gas other stakeholders are also taking commendable steps.

A few months ago the Nigerian Electricity Regulatory Commission (NERC) formally presented the Mini Grid Regulations at this meeting and its impact is beginning to manifest.

Last month in Abuja, Nigeria through the Rural Electrification Agency  hosted a Mini Grids Summit that is the largest ever attended in Africa with 600 participants from about 40 Countries.

The word is spreading around the world as mini grids will help us connect more people and boost incremental power.

We are also putting together a policy position to help expand the distribution network of the DisCos and use this to distribute the 2000MW that is currently available but cannot be distributed.

I also use the opportunity to call out to Manufacurers to let us know where they are, how much power they need, and how we can connect you because we have 2000 MW of undistributed power.

This year we should work harder to increase our people’s access to meters and reduce the incidents of estimated billing as NERC concludes the Meter Regulations that will open up the meters supply and installation business.

In the first few days of the new year we suffered a set back to our power supply which was caused by damage to the gas supply network around Okada.

First, I want to repeat that gas is the fuel that most of the generation companies use to produce electricity and all of us have a stake in ensuring that they are not damaged.

Secondly, I am happy to inform Nigerians that as at last night the Nigerian National Petroleum Corporation (NNPC) informed us that repairs have been completed. We thank and commend them for their response.

Thirdly, what remains is to test the lines and restore pressure and supply to the generation companies.

One by one all the stakeholders from GenCos, TCN and DisCos will work to restore supply to the levels they were before the pipeline damage.

From there we will continue our journey of incremental power.

I wish you all a happy new year.

Babatunde Raji Fashola, SAN
Honourable Minister of Power, Works and Housing

8th January 2018

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Photo News
10 January, 2018

FIRST FEDERAL EXECUTIVE COUNCIL MEETING OF 2018

Left to Right National Security Adviser MajorGen Babagana Monguno left Minister of Power Housing and Works Babatunde Fashola and Secretary to Government of Federation SGF Mustapa Bossduring the first Federal Executive Council meeting of 2018 presided over by His Excellency President Muhammadu Buhari GCFR on Wednesday 10th January 2018

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Power News
Photo News
12 January, 2018

FASHOLA INSPECTS THE NATIONAL METER TEST STATION OSHODI LAGOS

Hon Minister of Power Works Housing Mr Babatunde FasholaSAN 2nd left and Managing DirectorCEO Nigerian Electricity Management Services Agency NEMSA Chief Electrical Inspector of the Federation Engr Peter Ewesor 2nd right during the inspection visit of the Hon Minister to the NEMSA National Meter Test Station OshodiLagos on Thursday 11th January 2018

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