The Nigerian government has approved two major energy projects in Oyo State aimed at fortifying the national grid and addressing persistent power challenges.

Bolaji Tunji, special adviser on strategic communication and media relations to the Minister of Power, Adebayo Adelabu, in a statement on Wednesday, said the decisions were ratified during Monday’s Federal Executive Council (FEC) meeting.

The projects approved, according to him, include reviving and concessioning the decades-old Ikere Gorge Hydropower Plant and constructing a high-capacity new substation in Ibadan.

“The new substation to be located in Lalupon/Ejioku axis of Lagelu local government area will boost power supply to Iwo road, Monatan, Olodo and the adjoining areas in Ibadan.

“Originally launched in 1979 under the military regime of former President Olusegun Obasanjo and operationalised in 1980 during President Shehu Shagari’s tenure, the Ikere Gorge Hydropower Plant will now undergo a significant upgrade,” the statement said.

This, he said, signals a push to modernise infrastructure and boost electricity access.

The Ikere Gorge Dam, a key project under the Ogun-Osun River Basin Development Authority, aims to harness the water resources of the Ogun River basin. Conceived by Olusegun Obasanjo during his military regime, construction began in 1982 under Shehu Shagari’s civilian administration, with an initial estimated cost of $10 million.

The dam spans approximately 47 square kilometres and has an electricity generation capacity of 37.55 megawatts. The project’s civil works contract was awarded to Roads Nigeria Limited in November 1980 for N35.8 million, while Messers Noell (W.A) Limited handled the mechanical and electrical components.

Following the 1983 military coup that ousted Shagari’s government, led by Tunde Idiagbon and Muhammadu Buhari, work on the dam came to a grinding halt. For decades, successive administrations neglected the project, leaving it abandoned.

Mr Adelabu revealed that the facility’s capacity will expand from 6MW to 20MW under a 30-year public-private partnership (PPP) concession.

“The project, initially stalled due to a preferred bidder’s failure to finalise terms, was re-concessioned to a reserve contractor, Messrs Quaint Power and Infrastructure Nigeria Limited, after the original offer lapsed,” the statement said.

The minister emphasised that the revitalised plant will prioritise energy access for Oyo’s Oke Ogun communities, with an upwardly revised concession fee ensuring long-term viability.

According to the statement, the government also approved the construction of a 2 x 60MVA, 132/33KV substation in Lalupon/Ejioku in Lagelu local government area of the state, to alleviate pressure on the grid and improve energy supply.

It said the substation, part of the Siemens-backed Presidential Power Initiative (PPI), is to be funded directly by the Federal Ministry of Power and aims to resolve frequent outages and grid instability plaguing the state capital.

Mr Adelabu, according to the statement, noted that the infrastructure will serve as a backbone for strategic investments, enhance service delivery, and align with President Tinubu’s Renewed Hope Agenda for sustainable energy.

“The project includes upgrades to the 60-year-old 330kv Ayede substation and the construction of a new Asejire 330kv substation, further stabilising the grid for over 5 million residents. Completion is estimated at 24 months.”

It said both initiatives are expected to catalyse socio-economic growth by improving power reliability for households, small businesses, industry, educational and health institutions.

The minister underscored the role in resolving decades-old infrastructure gaps, noting that “These interventions will directly uplift livelihoods, attract industries, and position Oyo State as a model for Nigeria’s energy transition.”

“The approvals mark a critical milestone in federal efforts to tackle grid vulnerabilities, with stakeholders anticipating ripple effects on national productivity,” the statement said.