FG issues N590bn bond to settle debt owed to GenCos

The federal government has issued the first N590 billion bond under the presidential power sector debt reduction programme.

On October 7, Bayo Adelabu, minister of power, said President Bola Tinubu had approved a N4 trillion bond to settle verified debts owed to power generation companies (GenCos) and gas suppliers.

In a statement on Friday, the office of the special adviser to the president on energy welcomed the issuance of the bond.

According to the statement issued by NBET Finance Company Plc, a special purpose vehicle (SPV) of the Nigerian Bulk Electricity Trading (NBET) Plc, the N590 billion series 1 power sector bond is guaranteed by the full faith and credit of the federal government.

“CardinalStone Partners Limited is the Lead Financial Adviser and Lead Issuing House,” the office said.

The statement noted that this marks the commencement of the first phase of the bond issuance, which aims to raise N1.23 trillion by the first quarter of 2026 to settle verified arrears owed to generation companies and gas suppliers.

“The Presidential Power Sector Debt Reduction Programme authorises the issuance of up to 4 trillion Naira in government-backed bonds to address a legacy debt overhang that has constrained new investment, weakened utility balance sheets, and hindered reliable power delivery,” the office said.

“It has been described as the largest coordinated financial intervention in the history of Nigeria’s power sector.”

PRESIDENTIAL POWER SECTOR DEBT REDUCTION PROGRAMME TIMELINE

According to the statement, the presidential power sector debt reduction programme was approved by Tinubu and endorsed by the federal executive council (FEC) in August, authorising the issuance of up to N4 trillion in government-backed bonds.

“December 2025: Inaugural Investor Forum held to present bond issuance programme to over 600 participants drawn from banks, pension funds, insurance companies, issuing houses, asset managers, family offices, trustees, and other institutional investors,” the office said.

“December 2025: Launch of the 590 billion Naira Series 1 Power Sector Bond Issue under a 4 trillion Naira Multi-Instrument Issuance Programme”

The statement noted that the bond issuance programme will continue in 2026.

In her remarks at a forum held for prospective investors on December 10, Olu Verheijen, special adviser to the president on energy, said the programme is not a “bailout” but a “strategic reset”.

She said it is one that clears “verified arrears, restores liquidity, and gives power generation companies the footing they require to operate and invest with confidence”.

Verheijen added that clearing the debt will provide operators with the breathing room needed to stabilise operations and plan new investments, ultimately helping to deliver more power to Nigerians.