The Federal Government has approved the takeover of the mineral titles of Ogboyega North and South Coal Blocks, Mines number 769 and 772 ML from Western Metal Products Company (WEMPCO).
A statement issued on Tuesday in Abuja, by Ibeh Chidi, Head of Communications, Bureau of Public Enterprises (BPE), made this known.
Chidi said that the approval for takeover was given to Orbit Exploration and Natural Products Limited (OENPL) by the National Council on Privatisation (NCP).
He added that the company was set to generate electricity with coal from mines.
“In granting the approval, council noted that BPE’s due diligence on the enterprise indicated that OENPL can provide the financing and technical expertise needed to successfully operate the mines.
“It further noted that WEMPCO had requested for BPE’ s approval to transfer the mineral titles of the two coal blocks to OENPL in line with the provisions of the Asset Share Purchase Agreement (ASPA).
“Also, that OENPL has proposed to spend N112 billion to procure equipment for operationalising the two coal blocks and power generation.”
Ogboyega North and South Coal Blocks were sold to WEMPCO in 2007 at a fee of 7.378 million and 7.678 million dollars respectively.
However, 15 years after the transaction, the two coal blocks have not been fully operationalised.
Consequently, WEMPCO requested the bureau for approval to transfer the mineral title of OENPL.
Chidi said that this necessitated the bureau to review the provisions of the ASPA executed with WEMPCO which confirmed that the request conforms with the provisions therein.
He said the request also conform, particularly to Article 18.6 which allows such transfer of shares, subject to the consent of NCP/BPE.
He added that having studied the business plan and financial position of OENPL, BPE recommended that it was capable to operate the mines.
BPE was created through the Public Enterprises (Privatisation and Commercialisation) Act 1999, to diversify the economy and strengthen the private sector as Nigeria’s engine of growth and economic driver.