ALP Business Review – Energy

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Foreword

By Ron Clark,
Energy Partner Aird & Berlis, Toronto Canada.

The future has never been brighter for Nigeria. The World Bank now ranks Nigeria as the largest economy in Africa, and international investors are beginning to take notice. Over $8 billion of foreign direct investment flows to Nigeria each year, the most among African Nations, and a significant portion of that investment is directed at energy. Liberalization of the energy sector will play a key role in fostering Nigeria’s continued economic growth, as a demand for electricity continues to surge.
The restructuring and privatization of generation and distribution assets of National Electric Power Authority will have the twin benefit s of increase access to electricity and reduce blackout, thus, allowing business to flourish. The task of providing stable electricity to larger portions of the population will remains paramount as Nigeria continues to grow.
As a Canadian lawyer, it is of particular interest to observe the important role that some Canadians are playing in the restructuring of the energy sector. In 2012, Manitoba Hydro international signed a contract with the transmission Company of Nigeria to assume management responsibility and control of all of its operations. CPCS Transcom Limited (another Canadian firm) acted as transaction advisor for the Nigeria government in the privatization of generation and distribution assets.
Canadians are eager to invest in Nigeria energy, particularly as the sector begins to reduce its dependence on oil export and incorporate more renewable sources into its electricity generation mix. While Nigeria remains the largest oil producer in Africa and the world fourth- largest exporter of liquefied natural gas, renewable technologies are poised for growth-allowing diversification of the energy sector and a reduction in greenhouse gases.
Technologies like Wind and Solar are rapidly decreasing in cost, while hydroelectric power already make up a third of electricity generation in Nigeria and has room to grow.
To be sure, many challenges remain. This issue of the ALP Business Review explores a number of different option and questions to consider as Nigeria moves to meet those challenges by diversifying its energy sector, increasing the stability of electricity provision throughout the country, and decreasing regulatory hurdles that have slowed projects in the past.
As Nigeria steps onto the world stage, it needs to invest in infrastructure in order to meet the demands of its evolving economy. The international community should not miss the opportunity to share in Nigeria‘s rise on the world stage!