Nigeria’s long-delayed Mambilla hydroelectric power project has been clouded by a controversial $200 million settlement agreement involving Sunrise Power and Transmission Company Limited (SPTCL).
In early 2020, then Attorney-General of the Federation and Minister of Justice, Abubakar Malami, reportedly committed the Federal Government to paying Sunrise Power $200 million as a “final settlement” of its dispute with the government over the $5.8 billion Mambilla project in Taraba State.
Under the agreement, the government would also pay a 10 per cent penalty if it defaulted on the settlement, while Sunrise would be restored as the local content partner for the massive hydroelectric project.
Documents cited by TheCable reportedly show that Malami and then Minister of Power Sale Mamman signed the agreement on behalf of the Federal Government, while Leno Adesanya, Sunrise’s chairman and chief executive, signed for the company.
From $80m demand to $200m settlement
According to sources cited by TheCable, Sunrise had previously sought about $80 million from the Federal Government to withdraw an arbitration case it had instituted against Nigeria in France.
The dispute centred on an alleged breach of contract connected to the Mambilla project.
But in 2017, then Power Minister Babatunde Fashola disputed Sunrise’s claim, arguing that the company had not carried out any work that could justify its demand or arbitration proceedings.
Fashola also questioned the integrity of the underlying contract.
His departure from the ministry, however, was followed by renewed negotiations between the government and Sunrise.
A settlement was subsequently put together under Mamman and Malami, with TheCable reporting that the process was facilitated by a female figure within the presidential Villa.
A project decades in the making
The Mambilla hydroelectric project has been on Nigeria’s energy agenda for decades.
First conceived in the 1970s, the ambitious project has faced repeated delays, contractual disputes and funding challenges.
When completed, the proposed facility is expected to have a generating capacity of 3,050 megawatts, making it one of Africa’s largest hydroelectric power plants.
For Nigeria, the project represents a potentially significant addition to the country’s electricity generation capacity.
But its long history of delays and disputes has also made the Mambilla project one of the most contentious infrastructure projects in the country.
The reported $200 million settlement with Sunrise therefore adds another chapter to a decades-old saga over one of Nigeria’s biggest proposed power projects.
