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FG to Concession Abuja Airport Road

By on February 21, 2012

There are indications that the Federal Government plans to concession the eight-lane Abuja Airport Road to private sector investors because the project is suffering a funding shortfall of N51bn needed for its completion

Consequently, the Minister of the Federal Capital Territory, Senator Bala Mohammed, has approached the Infrastructure Concession Regulatory Commission to initiate a Private-Public Partnership arrangement to complete the project, which has reached 80 per cent completion.

Dependable sources at the FCT Administration said that the minister met the ICRC Chairman and former Head of the Interim National Government, Chief Ernest Shonekan, on February 14, when a deal was struck.

If the concession succeeds, it means that toll gates will be built on the road for the private sector investors to recoup their investment.

The very busy road serves as the only gateway to Abuja from the southern part of the country and also leads to the Nnamdi Azikiwe International Airport.

Mohammed told the ICRC chairman that the project could be stalled if there was no assistance from the private sector as the N51bn required for its completion was not in the 2012 budget of the FCTA.

The minister reportedly said, “There is no provision for the road in the 2012 budget. FCT has no means of carrying on with the road unless the ICRC can help us with a PPP arrangement to get private investors to take over and then we agree on the terms.”

However, the Chairman, Senate Committee on FCT, Senator Smart Adeyemi, said he would be surprised if the FCT Administration was considering the introduction of tolls for a road that had attained 80 per cent completion with government funds.

A senior FCT official told one of our correspondents that funds for the project were included in the 2012 budget, but when the document came back from the Ministry of Finance, it was not captured.

Asked about the measure that would help the private investor to recoup its investment on the road, the aide said that it could be through tolling and other options, which he did not mention.

Adeyemi told one of our correspondents that the Senate had b een grappling with issues of transparency on the award and execution of the Airport Road expansion project, which was awarded to Julius Berger Plc at the end of 2008.

The timeline for the construction of the road elapsed in December 2011. Work began on the road in January 2009 with a completion period of 36 months.

According to the senator, the road along the Kubwa-Kaduna end of Abuja was to cost N257bn. Originally, the Federal Government was to provide 40 per cent of the funding, while the private sector was to provide the balance.

However, along the line, the Federal Government took over the entire project, and by that arrangement, the cost was supposed to have been slashed by N38bn.

Adeyemi said, “The Federal Government constituted a committee because of that discrepancy. We are still awaiting the outcome of that committee’s work. I am surprised if that is the case. I have strong reservation about it. When the minister came to us, he did not tell us about that move. I will be surprised if that is the case. The project is 80 per cent complete. Going for PPP is belated.

“We have not been happy about the execution of the project. We have just received the budget proposal of the FCT and the minister will appear before us within two weeks. We will take it up from there.”

Meanwhile, the concession of the Second Niger Bridge in Anambra and Delta states; River Niger Bridge in Nupeko, Niger State; and Murtala Mohammed International Airport approach road in Lagos, will form pilot schemes for the development of a larger PPP in the road sector by the Federal Ministry of Works.