Offsetting N4tn legacy debts to Gen Cos good for power sector – Transafam boss

Acombination of factors both complex and superficial may be responsible for the lingering crisis assailing the nation’s power sector, The Nation can authoritatively report.

Investigation by our correspondent revealed that paucity of funds, poor infrastructure, policy inconsistencies, investor apathy, to mention just a few are chief among these crises bedeviling the power sector.

One man who should know better Vincent Ozoude, who sits atop as the Managing Director/Chief Executive Officer of Transafam Power Limited, a subsidiary of Transcorp Group, a Nigerian power generation company with an installed capacity of 966MW, comprising Afam Power Limited and Afam Three Fast Power Ltd.

Lending credence to the foregoing, Ozoude during an interactive session with some journalists recently said, the generating companies (GENCO) play a major role in bridging the energy gap in the country, but are seriously constrained to deliver, thus the result is that Nigeria’s energy landscape suffers, with only about 58 per cent of its population connected to the grid.

According to him, Nigeria’s power sector is grappling with tonnes of challenges; one of these is liquidity issues. “The GenCos are being paid only about 27 to 30 per cent of their invoices by the market. Thanks to President Bola Tinubu for his resolve to settle the legacy debt of N4 trillion being owed to the GenCos.

“Apart from the liquidity issues, the volatility of the foreign exchange, which keeps fluctuating and skyrocketing, is another snag. It impacts on our ability to procure spare parts and schedule the maintenance of our turbines as and when due. GenCos’ struggle to raise funding and foreign exchange to execute the power plant Inspection or outages.

“When an outage is planned at a certain cost, considering the exchange rate fluctuations, by the time the project is to begin with equipment capital parts purchased, the exchange rate would have increased, making GenCos look for more money than budgeted to complete the project.

“Then we talk about fuel gas for thermal generation companies. Fuel gas is about 60 per cent of the feedstock for gas-fired thermal power generation. Although Nigeria is the richest in natural gas resources in Africa, more investment needs to be made to unlock the bottlenecks around gas availability and supply for power generation needs by drilling new gas wells, work over and recovery of old gas wells to enhance gas production, facility upgrade and more gas transportation infrastructure networks.

“There is also a lot of force majeure around gas transportation, with vandalism often seen on some gas lines, especially in the eastern part of the Nigerian gas market. We also have a challenge of gas quality and pressure constraints.

“We urgently need to upgrade obsolete evacuation and transmission infrastructure. This makes power evacuation a challenge, especially in the rainy season, with a lot of limitations, up to transmission lines snapping in some instances. This limits our ability to produce or wheel more power to the grid for consumption.”

The Transafam boss, who spoke on the specific regulatory changes that should be prioritised to unlock Nigeria’s gas and renewable potential, acknowledged that Nigeria has huge potential to excel, and it would be incorrect to say the regulatory agencies, such as NERC, are not making an effort to improve the business environment in the sector that can aid improved power generation and across the value chain.

“However, we must consider formulating policies that can enable GENCOs within the proximity of gas wells to be allowed to invest in drilling and open up wells for the purpose of power generation, and in return, can be given priority of gas supply to the power plants. Some more incentives can also be given for those interested in gas investment for power generation. There should also be encouragement for renewables. They should be given offtake guarantees for the renewables potential to develop and play in this space.”

Pressed further, he said, the Transafam Power model demonstrates that Nigeria’s energy crisis is solvable through indigenous innovation, strategic integration, and relentless execution.

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While noting that the GenCo lights a path not just for Nigeria, but Africa in the commitment to achieve a lasting solution for reliable and accessible power to the continent, recalled that, Transfam recently made a strategic move to optimise the utilisation of some of its turbines.

“With the gas issues we currently experience in Afam, by resilient thinking, we have temporarily moved our Trailer Mounted turbines to our sister plant, Transcorp Power Pic, which has more gas availability to produce power till the gas situation improves in Afam. We also work with gas stakeholders and various OML operators that produce gas around the Eastern gas market on project initiatives that can recover more gas from the wells, transport the gas and develop more gas processing facilities to improve supply. We are adapting some technologies of the OEMS of our gas turbines that support running machines at low gas pressure to an appreciable extent. We are incorporating this into our plant generation equipment upgrade plan.”

Acquired by Transcorp Group in November 2020, Transafam, he stressed is committed to improving lives and transforming Africa. “Transafam’s mission is to consistently and safely generate electricity sustainably, becoming the preferred choice for all stakeholders by delivering reliable power solutions and contributing to the development of Nigeria.”

In May 2023, Transafam Power commissioned the 240-megawatt Afam Three Fast Power Plant and signed a 20-year Power Purchase Agreement with the Federal Government of Nigeria for 726MW of capacity.

“For us in Transafam Power Limited, we are quite aggressive in our push to ensure contribution to the growth of the power sector. Today, we are currently at 348 megawatts of power. Our target is to end the year with 378 megawatts of power, thereby continuously and aggressively contributing to the power sector growth. We’ll continue to work with the government in advocacy, partnering with the Electricity Regulatory Commission, partnering with the Transmission Company of Nigeria, and, of recent, the independent system operation, NISO, to ensure that the transmission sector is informed.”

Checks by The Nation revealed that a consistent and increased supply of gas from Tony Elumelu’s Heirs Energies is directly enabling improved power generation at Transcorp Group’s power subsidiaries–Transcorp Power Plc and Transafam Power Limited–solidifying the Group’s capacity to deliver enhanced value.

Dr Owen Omogiafo, President and Group Chief Executive Officer of Transcorp, confirmed the pivotal role of Heirs Energies at the conglomerate’s Investor and Analyst Conference recently, to discuss the Group’s impressive Q3 2025 results.

During the conference, she stated Transcorp Power and Transafam Power will remain focused on increasing generating capacity in the fourth quarter, with the former, Transcorp Power, targeting “750 megawatts of available capacity.”

“The average for the year will be 620 when you average from January to December 31. Of that 620, we target to generate 528 megawatts on average, with a peak generation of 590. As of Q3, we’re already at 424, and we are on track to achieve what we set out to do,” she highlighted.

“For Trans-Afam, we have successfully relocated four turbines from Afam to Ughelli, and we are finalising all the electrical connections. They’ve all been successfully tied to the grid, and one continues to operate, but we’re going to conclude the remaining three. And this week, push on with that generation.”

This assured gas supply from Heirs Energies has empowered Transcorp Group’s two power subsidiaries to set ambitious generation targets for the remainder of the year. Transcorp Power is targeting 750 megawatts of available capacity by year-end, while Transafam Power is targeting 378 megawatts. This enhanced operational capacity positions Transcorp Group to contribute more significantly to the national grid and create sustained value for its shareholders.

The Group recorded a 39% year-on-year increase in revenue, rising from N297.7 billion in Q3 2024 to N413.4 billion in Q3 2025. Profit Before Tax (PBT) grew by 18%, closing at N124.5 billion, compared to N105.5 billion in the same period last year.

Transcorp’s power businesses, Transcorp Power Plc and Transafam Power, provide over 20% of Nigeria’s installed power capacity. Transcorp is committed to developing Nigeria’s domestic energy value chain through its investments in OPL281. The Group’s hospitality business, Transcorp Hotels Plc, owns the iconic Transcorp Hilton Abuja, Nigeria’s flagship hospitality destination and Nigeria’s largest event venue, the Transcorp Centre Abuja.

It is also instructive to note that the power company is not just about boosting its bottomline but ensuring that the host communities are being taken care of.

This explains why Transafam Power Limited, successfully launched the maiden edition of its Corporate Social Responsibility (CSR) for the senior citizens of its host community, Okoloma-Afam, Oyigbo Local Government Area, Rivers State.

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The landmark outreach provided comprehensive medical screenings, wellness education, food, and essential items for the elderly, as well as long-term health monitoring tools to over thirty elderly residents comprising twenty-four women and six men, reinforcing Transafam’s position as a socially responsible corporate citizen deeply invested in the well-being of the communities that host its operations.

Speaking at the event, Ozoude said, “Today marks the beginning of what will become an annual tradition. As a company that powers nearly one-fifth of Nigeria’s electricity needs alongside our sister company Transcorp Power Plc, we recognise that true progress is measured not only in megawatts but in the lives we touch.

“Caring for the elders who have built the foundation of this community is both a privilege and a responsibility we take seriously. This initiative is one of many sustained CSR programmes through which Transafam Power continues to give back to its host communities,” he asserted.

The programme commenced with an interactive health talk by specialist doctors from Avon Medical Practice, focusing on healthy ageing, hypertension management, diabetes prevention and general preventive care. This was followed by free vital signs checks, physician consultations, laboratory investigations where required, and on-the-spot medication dispensing.

In a move that received widespread applause, every participating senior citizen received a digital blood pressure monitor each, a three-month supply of multivitamins, and a carefully curated package  containing food items, toiletries, bedding and other essential household provisions.

The Elderly Wellness Day forms part of Transafam Power’s broader healthcare-focused CSR pillar and portfolio of other ongoing community development initiatives such as Waste Management Initiatives, Medical Consultation and job opportunities for the youth.

Guests at the event, which had community leaders and beneficiaries, praised the initiative for its depth, compassion and meticulous organisation, describing it as “very impactful to the elderly people in Okoloma-Afam.”

At the event, Transafam Power Limited announced its commitment to making the Elderly Wellness Day an annual flagship event while continuing to expand its portfolio of sustainable impact programmes that improve health outcomes, education, economic empowerment and quality of life for its host communities.