Nigeria and China negotiate over coal exploitation

Oct 31, 2007 01:00 AM

The Federal government has begun negotiations with some Chinese companies over the exploitation of Nigeria's abundant coal resources estimated at over 1.5 bn tons. The Managing Director of Nigerian Coal Corporation, Dennis Okafor said approval has already been given to a “Group of Chinese Companies” to build seven power stations across the country using coal.
According to Okafor, "all over the world, coal has always been a major contributor to the energy demands of any nation. Around the world, it is the same everywhere. We cannot hide the fact that Nigeria is seriously endowed with coal resources. In fact, studies done on Nigerian coal deposits show that we have over 1.5 bn tons of black coal in Nigeria.”

“But there is the other one too, lignite, which is the immature coal. That one has not been fortified. It has a very large deposit at the same time. Coal is a major source of energy. It is used in power generation, firing the boilers of factories, in the cement and battery industries coal remaining essentials. Even at the domestic front, instead of using firewood to cook, we have what we call coal briquette or smokeless coal which we can use for cooking. I am sure this will impact seriously on Nigeria's energy demand if it is well exploited.”
"The present administration is seriously looking into the coal resources of the country now -- first of all, as a major energy source for power generation. Government is trying to look at a different direction -- from gas to coal now. There are programmes that are going onto that effect.”

Also, there are people from outside the country who want to come in and use our coal for power generation. There are so many of them. With time, the situation is going to change. The problem we had in the past was that as soon oil was discovered, we started showing too much interest in oil and forgot about other sectors. And now, the gas power plants are not meeting the energy demands of the country -- just as it does not meet the energy demands of any country too.”
“We have identified coal as a major alternative which has to be exploited. So the government is doing something in that direction. In addition to this, a number of foreign companies want to come in now to generate power using coal. That is the situation of things now.”

"We were at the Presidential Villa the other day when a Chinese Group of Companies came -- they want to build about nine power plants within the country using coal. They have been given the go ahead order but they are still working out their modalities.”
“Government used to be the only operator in the coal industry. But since 2001, government decided that enough is enough -- that it would no longer be directly involved in the coal industry. To this end, the government decided that anything that has to do with mining should be given out to private companies to manage while it sits back as an administrator or regulator.”

"That is why in the case of the Nigerian Coal Corporation, activities are slowing down now because the company is being privatised. The first step that has been taken in this direction is that all the areas of coal deposits where the company was operating have now been blocked like oil blocks.”
“There are nine of them which were advertised for bidding. The bidding has been done and companies have won the blocks. In the meantime, they are tidying their papers with the Bureau for Public Enterprises and mobilising to take over so that the government will just be the regulator and not the operator."

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