Govt not satisfied with Manitoba’s performance

No Comments » January 6th, 2014 posted by // Categories: Energy Development Project



Govt not satisfied with Manitoba’s performance

Sunday, 05 January 2014 21:44 Written by Emeka Anuforo, Abuja
Reviews three-year transmission management pact

• ‘How World Bank, DFID stopped termination of contract’

A TIMELY intervention by the partners of Manitoba Hydro International Nigeria Limited has allegedly saved the company from losing its contract with the Federal Government.

The World Bank and the Department of International Development (DFID) of the United Kingdom intervened as the government moved to revoke Manitoba’s three-year contract to manage the Transmission Company of Nigeria (TCN).

The government is now reviewing the contract to improve the performance of Manitoba. For months now, indications have emerged that government does not seem quite satisfied with the level of experience so far exhibited by Manitoba for the contract.

The Guardian learnt that instead of bringing core experts from its Canada headquarters, Manitoba gathered people from different parts of the world, a situation a Presidency source described as condemnable.

“Manitoba Hydro International is bringing all manner of people to execute the contract. The people they have brought are even learning from the Nigerian people instead of the other way round. The Nigerian people are not learning from them,” the source said.

Instead of the direct knowledge transfer, which was a core aspect of the contract, the initial expatriates brought by Manitoba were alleged to have been rather learning from the Nigerian technical persons they met at TCN.

Manitoba is also accused of not having any sense of urgency for the task. The number of system failures was also said to be getting worse, while about 21 outages were recorded at a period, in addition to several cases of collapse.

Though details of the nature of the intended review were not immediately clear, The Guardian learnt from top level authorities that government was disappointed in the way Manitoba had so far managed the TCN for which it secured a Schedule of Delegated Authority from the Nigerian government.

A government source told The Guardian: “The issues around the contract have been lingering since the contract was signed. The execution of the contract in terms of operational efficiency, good governance, transparency and knowledge has not been the case.”

It was learnt that Manitoba had allegedly capitalised on the weakness in the supervisory board initially constituted by government for TCN to carry on unsupervised.

The Guardian was also told that the appointment of a new chairman by government for the supervising board of TCN was an interim ‘political solution’ to the problem.

Officials of the Ministry of Power and the Bureau of Public Enterprises (BPE) were not willing to speak officially on the matter. But a source told The Guardian that the Ministry of Power had been meeting with the management of the Canadian firm to check the performance indicators on the contract against actual delivery and was not impressed.

“Preparatory to a possible review of the contract, the Minister of Power has given a matching directive to Manitoba to show how it hopes to reduce system failures, engender knowledge transfer, transparency and other key components of the management contract it had with government. The Federal Government is keen on enshrining adequate performance.

“I can tell you that Nigeria is considering reviewing or revoking the contract,” the source said.

It was learnt that the decision to step down on the revocation of the three-year management contract was because of the arguments of the World Bank and DFID officials who reasoned that it would paint a picture of instability in the international community.

When contacted, one of the expatriates engaged by Manitoba, Mr. Jan Bagnall, promised to prepare a comprehensive response for The Guardian. As at the time of going to press, Bagnall, who serves as Executive Director (Market Operations) at TCN had not sent the response.

But General Manager, Public Affairs at TCN, Mrs. Segun Olagunju, described the allegations of non-performance against the managers of TCN as ‘unfounded.’

She told The Guardian: “They (Manitoba) are on top of their contract. For instance, we have recruited 522 young engineers who are resuming next week. So many engineers are undergoing training. There is also training and retraining of Nigerian experts in-house.

“There are so many hands on training from Manitoba. The allegation is not true. It is also wrong to say the system collapses have anything to do with Manitoba. We have been working so hard to upgrade the system.”

With the conclusion of an arrangement between the Federal Government and Manitoba Hydro International of Canada in respect of the contract management of TCN, Manitoba Hydro formally assumed control of TCN operations on July 30, 2012, though the actual handover was initially delayed because of conflicting interests in government.

The $23 million agreement handed over the management of the TCN to Manitoba for a period of three years, during which local workers would understudy their operations and a transfer of skills is expected to take place.

The operations of TCN include the key three functions of Market Operator (MO), System Operator (SO), and Transmission Service Provider (TSP).

A statement released from Manitoba Hydro International from its Canada headquarters immediately after the contract indicated that throughout the term of the contract, one key objective would be to reorganise TCN such that the Transmission System Operation (TSP) becomes a separate entity from the Market Operator (MO) and System Operator (SO) allowing it to become a privatised commercial company.

“MHI expects to turn TCN into a technically and financially efficient, stable, and sustainable company; a company that will be market-driven and capable of utilising its maximum generation capacity and then distributing the energy throughout Nigeria 24 hours a day, 365 days a year. To do this, MHI will have to focus on developing the proficiency of local personnel,” the statement had added.

But indications at the weekend showed that government had not been very impressed with the way various aspects of the contract were being handled.

It was learnt that a recent Federal Government’s assessment of the performance of Manitoba at TCN had scored the firm poor in the areas of contractual compliance, technical performance, decision-making, business essentials, improving business practices and capacity development, among others.

According to officials, the report also faulted Manitoba in the area of improving company culture and staff-motivation and supporting power sector reforms.

The company, however, scored good in providing utility technical support, developing or supervising technical training.

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