‘160m reasons to invest in Nigeria’s power sector’
Joseph Wilson, chairman, Symbion Power Africa, and former United States ambassador with career tours spanning three decades in Niger, Togo, South Africa, Burundi, Congo Brazzaville, Gabon,Sao-Tome and Principe, also served as special assistant to former US president, Bill Clinton, on African affairs. Wilson was recently in Nigeria to meet with relevant stakeholders in the power sector and told select journalists including AMETO AKPE, that there are about 160 million reasons to invest in Nigeria’s budding power sector while expressing confidence in government’s sector reforms.
Mission in Nigeria
I am a retired United States ambassador and currently serve as chairman of Symbion Power, Africa, which is a contractor that specialises in power construction as in Engineering, Procurement and Construction (EPC), and we are currently working in Iraq and were until recently in Afghanistan. Symbion Power Africa is a subsidiary of Symbion Power, currently contracted inTanzania to build sub-stations, transmission and distribution lines.
We are partnering Pro-Global Power here in Nigeria to bid for some of the distribution companies when they come up for sale, it is our business strategy to be competitive here in Nigeria and to make Nigeria one of our strategic focal points, so I’m here to finalise details with our consortium partners and also to meet with relevant Nigerian authorities and business community to get a sense of the market and business requirements.
Which entities have you interacted with so far?
We were with members of the regulatory agency, Nigeria Electricity Regulatory Commission (NERC), the Bureau of Public Enterprises (BPE) as well as the United States ambassador here in Nigeria and the World Bank representatives in the power sector and I came with a very positive view of Nigeria and of the efforts of the government to deal with these very serious structural reforms in the power sector.
Why have you chosen to invest in Nigeria?
There are a couple of reasons why we chose Nigeria. Actually, there are a 160 million reasons why Nigeria. It is obviously the heavy weight on the continent. And certainly, it is in a very dynamic and ambitious growth phase. So it’s a big market and it’s like Frank Sinatra used to sing ‘if you can make it in New York you can make it anywhere.’
And we really want to partner Nigeria and Nigerian companies here in this market because we think that government and the bureaucracies within the government are all very serious about reforms and then finally you want to take advantage of opportunities and this is where the reform of the power sector is going to be taking place in the very near future.
So the opportunity is here and the opportunity is now which is why we are here now but also looking and thinking strategically over the long term. We think to be in position in Nigeria is probably a good idea for a company so long as we can operate in this environment.
Our company’s corporate philosophy is to use as much local content as possible and to spend as much or more than anybody else on domestic capacity building. So, when we were in Iraq- to give you an example- during the course of the nine projects we completed three during the war, we trained and certified over 4000 Iraqis as lines men. In Tanzania, we have just trained and certified the first female Tanzanian lineman. So training is a big part of what we do, partnering, co-partnering is a big part of what we do.
What specific part of the sector do you want to invest in?
Well, we are looking at acquiring two distribution companies, Enugu and Abuja distribution companies, and that is what we are focusing at now. One of the ways we grew in Tanzania was that we started with contracts in distributions and transmission and moved on to power plants which is a new line of business for us, one that we happen to learn about very quickly and get on a sound footing, we will see if we can make a business out of it here in Nigeria, but we will essentially begin with distribution which will give us a foothold before looking out for other business opportunities in the sector.
How much of investment are you bringing into the sector?
We really do not talk figures except with our partners and we cannot disclose that now until when the bidding process is completed and it becomes public information.
What do you think about the current security challenges in the country; does it pose any threat to your planned investments?
We are accustomed to working in hostile environments that are more hostile than what is obtained in Nigeria. One of the major investors in our company is a security company, so we have our own security intelligence and we think that having such in-house experience helps us to address certain security issues, we expect that they will carry out security checks to ascertain our security needs, but I would add that it is not our intention to come in here and buy up assets to move them elsewhere but to stay in Nigeria and help the country address its power requirements.
Following your meetings with stakeholders; in specific terms, what pleases you with reforms in the sector?
Well, I cannot tell you specific terms because we have not had the pre-due diligence conference yet; in fact, one of the reasons why I am here this week is because of the conference which has been postponed until October 14, we are not yet at a stage where I can tell you some of this specifics, but I can tell you that as somebody who has been around the West African region for close to 35 years, I am really struck by the goals and objectives of the new leaders that I met with in the course of my meetings in the country which is more of your generation, the younger generation and I am much more optimistic that your generation will get things back on track, what my generation was unable to do.
How optimistic are you with the business environment?
One of the first things we do as a competitive entity that makes us optimistic is that we partner local people just like Pro-Global which is on ground here and understands the power sector, the first decision we make is to initiate a cordial relationship with our local partners, we are not coming here as a foreign company expected to do business from day one but with people who have got experience and have been in the market for a while and that is a good approach to mitigating risk and optimising efficiency.
I am not so optimistic that everything is going to go without a hitch, but I do think that with our experience as one of the very few American companies who are in this particular niche, with the right local partner and support system, we can operate pretty well, we will basically leave it to our partners to control the local presence, we are the technical partner here and so we will bring our EPC prowess into the partnership.
Your track record
Symbion has been among the most successful contractors in Iraq, we completed nine electrification projects more than any American company and valued at $260 million; including the construction of transmission lines from Basra to Baghdad and around the Al Anbar province during the height of the conflict in that region; we have also worked on a 100MW power plant inKabul and are now working in Tanzania where our operations include two distribution projects and one for the design and building of substations across the country. The projects are valued at $130 million; the distribution projects extend over 1700km of lines and include the new construction and extension of 24 substations across the country in eight geographical locations.
The US Secretary of State, Hillary Clinton, recently commissioned our newly built 120MW power plant in Tanzania, making it one of the largest producers of power in East Africa. We intend to expand into Nigeria, Southeast Asia, Haiti and the Caribbean as well as Russia and Guam.
Will you still invest in Nigeria, if your bid for the distribution companies fails?
Yes, I think I mentioned it before and will say it again that we have determined as a corporation that Nigeria is strategically important to us and we have to be here and take opportunities as they unfold in the power sector. We have an emerging partnership with Pro-Global and we are not here to go once the bid for the distribution companies are over, we are in here and it is our expectation that we will be able to do business here.
What was your discussion with the World Bank?
We basically talked about the business climate in Nigeria and the reforms in the power sector, we really did not talk much on the Partial Risk Guarantee (PRG) which the World Bank is offering to government.
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