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FG Signs $1.5 billion Lagos-Kano Rail Agreement with Chinese Firm

By on August 29, 2012

The Federal Government yesterday signed an agreement for $1.49 billion to China Civil Engineering and Construction Company.

The contract is for the modernization of the  initial phase of the Lagos to Kano line which covers a distance of 156.65 kilometers and focuses on Lagos to Ibadan.

The contract was agreed to in July by the members of the Federal Executive Council.

Signing on behalf of the Federal Government was Senator Idris Umar.

He disclosed that $1 billion of the sum required to finance the project would be borrowed by Nigeria from the China Export-Import Bank.

Umar said, “Under the arrangement, the loan facility to the tune of $1bn (N158bn) is going to be provided by the China EXIM bank. However, negotiation has been concluded with China EXIM bank for an initial $500m (N79bn) during negotiations in China.

“The negotiation of the balance sum of $500m is expected to be done in due course, and the Federal Government is expected to pay the balance of the fund in the sum of $530.77m.”

Managing Director, CCECC, Mr. Cao Bao Gang, said the project would create 5,000 jobs.