NIGERIA: DESPITE UNTAPPED DAM, GOMBE STATE

UNCLAS SECTION 01 OF 02 ABUJA 003014

SIPDIS


SENSITIVE


E.O. 12958: N/A
TAGS: PGOV ECON EFIN ENRG NI
SUBJECT: NIGERIA: DESPITE UNTAPPED DAM, GOMBE STATE
MOVING SLOWLY FORWARD



1. (SBU) SUMMARY: During an October 4-6 visit to
Gombe State, Ambassador Jeter surveyed Gombe's
power, water, education and health sectors with
Gombe State officials, in the course of a second Ambassadorial
foray to the Northeast. With its agricultural
potential and good hydroelectric promise, Nigeria's
14-year old Dadinkowa Dam sadly remains unused
because the GON never completed the project's final
stages. Gombe State is keen on finishing the GON-
owned dam (Nigeria's second largest),but has not
identified funding sources or investors. While
completing a much-needed small water supply system,
the State's larger unfinished water project may soon
stagnate because of lack of funding. Since assuming
office in 1999, Gombe's Governor Hashidu has
improved his state's water supply, rural
electrification, and security. Hashidu is well
positioned to win re-election in 2003, but will then
have an uphill battle funding his more ambitious
projects. END SUMMARY.


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AGRICULTURE DEPENDENT
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2. (SBU) Ambassador Jeter, accompanied by Econoff,
Staff Assistant, and EDDI Coordinator, visited Gombe
State (Northeast region) on October 4-6. With over
80% of the State's population agrarian, Gombe's
economy is hamstrung by years of neglect of the
agriculture sector under military and civilian rule.
Situated in Nigeria's Savannah region, agriculture
production and revenue suffer from unpredictable
rainfalls and poor farm-to-market roads.


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DAM'S POTENTIAL UNTAPPED
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3. (SBU) Ambassdor Jeter visited Gombe's Dadinkawo
Dam on October 5 with state Water Commission
Executive Director Jamrlu Ishiyaku Gwamna. Operated
by the Federal Government's Upper Benue River Basin
Development Authority, Dadinkowa Dam is Nigeria's
second largest. The dam was originally planned to
furnish hydroelectric power and water to 66,000
hectares of farmland. However, the dam produces no
power and only irrigates 50-100 hectares through a
heavily silted 3-mile canal system. The canals,
originally designed to be 5 miles long, have never
been used for their original purpose. The GON-owned
Dadinkowa was never fully operational because past
military regimes misappropriated money or never
funded installation of the turbines needed to
generate power for hydroelectricity and irrigation.


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UNTAPPED POTENTIAL
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4. (SBU) The GON announced in August 2001 that it
would allocate USD 32 million to refurbish
Dadinkowa. Abuja-based political opponents of
Governor Abubakar Hashidu however blocked the
funding, according to an Embassy source. A Gombe
State official told Econoff that they did not expect
any GON financing, Gombe now sought an Individual
Power Project (IPP) investor to install turbines,
establish a power grid, and sell electricity to a
local cement plant, light industries and consumers
in Gombe City.



5. (SBU) COMMENT: Navigating the bureaucratic maze
to get all the relevant GON agencies and offices to
agree to an IPP could be a difficult but not
impossible task. Also, Gombe will have to figure
out how the IPP could tie into NEPA lines and how it
will fit in with plans for NEPA's eventual
privatization. An U.S.-based consulting firm, which
hopes to broker a deal to equip Dadinkawo, has
informed Econoff that General Electric (GE) Hydro
will visit Gombe next month to assess the viability
of the State Government's plan. END COMMENT



6. (SBU) The dam's design calls for installation of
2 turbines, 2 water cooled generators, a switch
yard, and 5 km transmission line to connect into
NEPA lines. It is estimated that the dam could
produce 34 MV of electricity. The cost to complete
Dadinkowa's power plant is approximately USD 30
million.


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LONG-TERM WATER CONCERNS
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7. (SBU) The Ambassador and party also visited
Gombe State's proposed USD 65.5 million regional
water supply system under construction by the
Pakistani engineering firm Shaukat and Raza. The
regional scheme, which takes its supply from
Dadinkowa and designed to provide service to 11
towns, has only reached 30% completion since
construction started in 1999. Gwamna said the State
had financed the entire project until now, and hoped
to receive at least 10% from local governments. He
was unsure whether the 30% due from the GON would be
forthcoming this year. He added that the State
Government was paying just enough to keep the
contractors working, and would provide additional
funding in the future. Even when the project is
completed, the state was not sure how it would
collect fees-for-service to keep the system
operating. (COMMENT: Like Dadinkawo Dam, this
ambitious water scheme remains unfinished. If the
GON does not furnish its 30% share or Gombe State is
unable to fund the entire project, the Pakistani
contractors may depart, leaving another costly
opportunity missed. END COMMENT)



8. (SBU) The Ambassador also visited a new USD 5
million 13-borehole deep water supply system. Paid
for by the State Government and built by a Chinese
company subsidized by Beijing, the system supplies
about 40% of Gombe's capital city's water. (COMMENT:
Water scarcity will remain a problem for developing
Northeast towns like Gombe City. If Dadinkawo Dam is
not used as a water source, water scarcity will
hinder the capital city's economic development. END
COMMENT)



9. (SBU) Gombe's Commissioner for Education Dr.
Habu Dahiru briefed the Ambassador on the State's
campaign to enroll new students, noting that
enrollment has increased three-fold since 1999.
Dahiru stressed that, like most of Nigeria, the
State lacks classrooms and trained teachers. The
Ambassador also visited a local health clinic where
Gombe had established an HIV/AIDS testing and
counseling facility, and an incubation facility for
day-old chicks which is going some way to satisfy
the growing demand for poultry in the State.


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COMMENT
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10. (SBU) With growing school class sizes and
decrepit health clinics, Gombe State is hard pressed
to maintain its modest facilities without major
federal government intervention and investments.
Governor Hashidu has made some progress, providing
citizens improved drinking water, rural
electrification, and relative security for rural
residents, particularly the farmers who, for years,
were subjected to the armed cattle raiders and
banditry from marauding gangs. Hashidu, who has a
strong chance of winning re-election in 2003, will
have an uphill battle finding investors to complete
Dadinkowa or finance his large water project.
Overall, however, the Gombe State Government is well
run and Hashidu is providing strong and honest
leadership. END COMMENT
ANDREWS