Vice President Yemi Osinbajo, who witnessed the signing of the agreement at the Presidential Villa, said the event is very significant for the country as it would encourage investment in gas infrastructure.
He said government expected that going by the current power situation, the investment was worth celebrating.
He said government was grateful to the World Bank and the investors in the Calabar plant for coming to the aid of the country in its drive to increase power supply.
“We are looking forward to the multiplier effect that will come from this investment,” Osinbajo said, noting that the gas plant traversed Rivers, Cross River and Akwa Ibom states.
The Vice President also said the investment would portend greater things that could happen in the future.
Mr Chiedu Ugbo, the Managing Director, Niger Delta Power Holding Company (NDPHC) Ltd., said the agreement was to tackle the gas supply issues in the plant built to generate about 561 megawatts of electricity.
He said the agreement was to enable the gas supplier to supply approximately 131 million cubic feet of gas per day to the Calabar plant, from its field in Akwa Ibom.
Ugbo said it was the first PRG agreement for the security payment for the supply of gas to cushion the breach in payment for the supply of gas.
According to him, the Calabar Generation Company is owned by the NDPHC, a concern of government, adding that in the event of breach, JP Morgan under the World Bank would pay and be reimbursed gradually in 12 months.
Also Speaking, Mr Philip Iheanacho, the Chief Executive of Seven Energy, said this was the first gas-to-power guarantee that the World Bank had provided for encouraging investment in the gas sector in Nigeria.