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Tag: Lagos-Ibadan

  • 19 die in Lagos-Ibadan expressway crash

    19 die in Lagos-Ibadan expressway crash

    Fifteen people yesterday died in a multiple auto  accidents on Lagos-Ibadan expressway.

    It involved a truck, a fuel tanker and a commercial bus.

    The accident, which occurred  at the Fidiwo-Ajebo, Ogun State stretch of the Lagos-Ibadan Expressway, left 19 passengers and driver of the commercial bus dead on the spot.

    The truck was marked AJG 40 XA and fuel tanker has a registration number RAN 571 XA. The passenger bus was marked (LAGOS) AGL 373 XR.

    It was learnt that the accident occurred, when the driver of the fuel-laden truck moving in the direction of Ibadan, Oyo State, attempted to overtake another truck at a road diversion point.

    But the driver lost control of the truck and veered off, crashing into the commercial bus, which was coming in the opposite direction.

    As at 2:30pm, operatives of Ogun State Traffic Compliance and Enforcement Agency (TRACE), the police and the Federal Road Safety Corp (FRSC) were seen trying to pull victims out of the mangled passengers’ bus.

    The Sector Commander, Ogun State Command of the FRSC, Adetunji Adegoke, in a text message to The Nation, stated that 15 persons  – six females and nine males – died in the accident. One person sustained injuries.

    Adegoke, who blamed the cause of the accident on “wrongful overtaking”, added that the injured was taken to the Olabisi Onabanjo University Teaching Hospital (OOUTH), Sagamu.

    He said the dead were taken to FOS Mortuary, Ipara, near Sagamu.

    The FRSC Sector Commander advised “drivers to obey road traffic rules and regulations, avoid wrong overtaking, observe speed limit as well as shun the use of expired/tokunbo tyres to avoid accidents on the roads”.

     

  • Bi-Courtney and Lagos-Ibadan Expressway

    SIR: A distinguished man of letters and former Nigerian ambassador to Germany, Prof. Akinjide Osuntokun, wrote about the sorry state of the Lagos-Ibadan Expressway in his March 31, column in The Nation.

    The article, entitled ‘Lagos-Ibadan Expressway is jinxed’, came with factual and emotional dimensions. It is yet another page in a series of spirited newspaper commentaries on the troubled highway reconstruction project.

    The article reflects the pains in the hearts of road users, but deflects from the fact that government is to blame for their woes, not Bi-Courtney Ltd.

    Osuntokun stated: “The way things are going on in this country, we may die under the weight of irresponsible litigations.”

    That statement would get any unprejudiced reader wondering what other options there are for an investor who had a partnership arrangement with the Federal Government (FG) to provide good infrastructure for Nigerians but lost over $300million, while government officials were blocking his every move to make progress on the project. It took the FG more than two years to even approve the design for the road. Then, the same government that failed to play its part well, turned around to terminate the concession agreement, and engaged a new concessionaire in a shady and unlawful manner.

    The article further stated: “As for the lawsuits, there is need for out of court settlement… If out of court arbitration fails, this government should be strong enough to damn the consequence in the public interest. I mean heaven will not fall! The government which owns the land should declare the company a trespasser and build the road. Enough of Turenci!”

    Declare Bi-Courtney as a trespasser? This is difficult to reconcile with Prof. Osuntokun’s insistence, elsewhere in the article, on doing things properly. If there were any trespasser on this project, it is government. Trespass, going by definition, is the act of being present on another’s land without lawful excuse. Bi-Courtney is the rightful owner of the highway by virtue of its concession that was purportedly terminated.

    Events have shown that government is the meddlesome interloper and self-interested intruder on the highway project. The writer should have exposed the rot in the system and how the country is fast becoming a cemetery of dreams for investors.

    Bi-Courtney, being a responsible corporate citizen, had demanded for arbitration; that’s a peaceful conflict resolution mechanism enshrined in the concession agreement. It’s meant to guard against the so-called ‘irresponsible litigations’, but the Federal Government shunned that demand thereby plunging the project into crisis.

    While addressing the issue recently, the Minister of Works, Babatunde Raji Fashola, said: “Regrettably, while not going into the merits and demerits of the FGN’s cancellation of the concession, it sends a not-welcoming message to foreign investors if the decision was without basis or influenced by politics…

    “If that was the case, as a foreign investor, I will be asking myself the kind of treatment that awaits me as a foreigner if the government does that to a citizen…”

    Why is Bi-Courtney fighting for justice?

    Some people seem to have forgotten that the FG made Bi-Courtney do palliative works, repeatedly, on the entire road for three years, and even reclaimed the completely damaged Aramed end of the road near Ibadan at a huge cost, while the company was held back by bureaucratic bottlenecks in the Ministry of Works.

    While stating that it was not opposed to the reconstruction of the road, Bi-Courtney had noted, among other things, that it had never received a kobo from the FG or any of its agencies, unlike what the same government had turned around to do for another would-be concessionaire that was being paid N2billion monthly for the same project and was also provided with unlimited guarantee.

    A guarantee was all that Bi-Courtney needed, and had asked for, but was denied in 2012, when its international partners – Group Five, were ready to roll.

    There is danger ahead if we fail to expose the rot in our system and make amends. Government must be guided to do the right thing at all times.

    Now that the FG is committing additional N40billion to the road project, there’s an urgent need to dialogue with Bi-Courtney, apologise to the company for all the unconstitutional actions by the FG, and work out modalities on how it can be part of the project. Shutting the firm out is not the way to go.

     

    • Olusegun Kehinde,

    Lagos.

  • Lagos-Ibadan Expressway: The way out

    That the Lagos-Ibadan Expressway has been so mired in controversy of high magnitude, attracting so many interests, is because of its significance to the socio-economic life of the country. Incidentally, it is the only major artery to Lagos, handling more than 90 per cent of the entire human and vehicular traffic to the commercial capital of Nigeria. It is the only road accommodating the large number of articulated vehicles, among thousands of other vehicles, lifting fuel and other goods out of the port city of Lagos, even as almost all attempts made to revive the railway system of the colonial era have been frustrated. This explains the interests always generated when the 115-kilometre expressway is being debated.

    In fact, the ante was upped in recent months because of the excruciating suffering of commuters and the sudden emergence of a company, Motorway Assets Limited (MAL), which claimed to be the new concessionaire, seeking N150billion to complete it – even when we were told by the past administration of President Goodluck Jonathan that it had awarded the contract for its reconstruction to Julius Berger and Reynolds Construction Company (RCC) at the cost of N167billion.

    Meanwhile, the Ogun State government also claimed that it carried out palliative measures to fix portions of the same road that had been purportedly concessioned to MAL. It is now abundantly clear that the shenanigans concerning the road were caused by the Jonathan administration, for political gains and selfish interest. It is also clear that the process of re-concessioning the road to Motorway after the termination of the concession to Bi-Courtney Highways Services Limited (BHSL), was far from transparent, as Nigerians were not aware of any calls for competitive bidding from competent companies for the road. It is obvious that it was an under-the-table deal, because Nigerians were also not aware when the purported contract to Julius Berger and RCC suddenly turned to a concession to Motorway, whose antecedents in PPP were also not known. Moreover, not a few are confused over the role played by the Infrastructure Concession Regulatory Commission (ICRC). The ICRC, as we know, is saddled with the responsibility of regulating PPP.

    Therefore, for the road to become a world-class one on which travellers can have safe and smooth rides, there is the need for Federal Government to revisit the concession earlier granted Bi-Courtney. Simply put, Federal Government can escape the legal and moral cobweb in which it has entrapped itself, by allowing Bi-Courtney to complete the reconstruction on account of the company’s antecedents.

    No one can deny that Bi-Courtney, having spent three years maintaining the road with over $300million down the drain while its concession lasted, having acquired billions of naira worth ofequipment in preparation for the work to begin, and having the technical manpower and the financial muscle to execute the project, has the wherewithal to execute the concession excellently. Bi-Courtney’s performance at the Murtala Muhammed Airport Terminal II (MMA2) attests to its capability to handle projects of such magnitude anywhere in the world.

    Recall that former President Olusegun Obasanjo had attempted to expand and improve the Lagos-Ibadan road by concessioning it to BHSL under a Design, Build, Operate and Transfer (DBOT) arrangement under the Public-Private Partnership (PPP) mantra of his administration. However, the brilliant idea did not yield the desired result before Obasanjo left in 2007. The succeeding administration could also not do much, despite its good disposition to the project, before the unfortunate demise of President Yar’Adua. It is noteworthy to recollect that officials in the Ministry of Works played an ignoble role by sabotaging Obasanjo’s concession idea with snail speed bureaucracy, vested interests, unbridled politicking and ignorance about how PPP works, all of which led to the final surreptitious termination of the concession by the Jonathan administration.

    While Nigerians waited with bated breath for the commencement of reconstruction of the expressway by Bi-Courtney, which waited for about two years for the approval of its design by the Federal Ministry of Works, we witnessed routine maintenance of several portions by the company, as a way of minimizing the incessant crashes and traffic gridlocks on the road, which the current concessionaire has refused to do because they lack the financial muscle and the technical capability to handle a project of this magnitude.

    Although when Jonathan announced the termination of the concession in November 2012, it was celebration galore by a section of the populace simply because they did not understand what concession is all about, events in the last few months and the attendant confusion have shown that it is not yet Uhuru for the Lagos-Ibadan Road.

    All over the world, concession is a major way of financing big projects, as various countries have embraced the PPP idea. But, such concessions are done transparently in other climes, while they are done deceitfully in Nigeria. From the Americas to Europe, Asia and other continents of the world, the idea of PPP has come to stay and Nigeria cannot be an exception in a global village. However, our country must do it right and with sincerity of purpose. Many companies are already involved in concessions, encouraged by their governments to provide jobs for their people and take the pressure of infrastructure provision off the government, but their concessions go to companies with the technical competence and financial muscle to execute such projects.

    In fact, Ferrovial Subsidiary Cintra, as one of the world’s leading private sector developers of transportation infrastructure in terms of the number of projects and the volume of investment, manages 28 concessions extending more than 2,232 kilometres of roads in Canada, the United States (US), Spain, the United Kingdom (UK), Portugal, Ireland, Greece, Colombia and Australia. The firm is one of the soundest multinationals in the sector, with investments totalling over 21.5 billion euro.

    Also, South Africa has an important experience in PPP, involving about 300 projects on the national and provincial levels since 1994. Indeed, the South African National Treasury, the body that deals with PPP projects, developed a PPP Manual. The manual defines “a PPP to be a contract between a public sector institution and a private party, in which the private party assumes substantial financial, technical and operational risks in the design, financing, building and operation of a project.” The guidelines discuss various procurement possibilities varying between public procurement and full privatisation. The South African National Roads Agency began tolling part of the major national roads in the mid-1990s and developed concessionary structures to overcome budgetary constraints.

    This is the beauty of PPP because it allows government to channel its resources to other means for the benefit of the citizens, and Nigeria with its current financial straits cannot be an exception.

     

    • Olagokun is an Ibadan-based company executive.

  • Lagos-Ibadan expressway is jinxed

    The rains are here. Thank God. The heat was becoming unbearable and many times I thought perhaps I was in hell because hell cannot be hotter than this. I hope America will experience the same kind of heat we had this year  in Nigeria to shut the loud mouths of those members of the Republican Party who deny the scientificity of global warming. Throughout the dry season from December 2015 to March, many of us anxiously looked forward to substantial work being done on the Lagos – Ibadan expressway. But alas nothing was done and hundreds of people are still dying needlessly on the most travelled road in Nigeria. Even if our government does not care for the people using the road, it should be concerned about the economic damage this bad road is doing  to the country. This road is the artery connecting the major port of Lagos which is also the economic nerve centre of the country to the north and other parts of the south of the country. Rudimentary knowledge of economics would indicate the fundamental importance of transportation in the life of a country. A country that is not in constant movement is a dead country. In our situation where we do not have railways, and where there is only primitive use of water-ways and our aviation leaves much to be desired, we just cannot do without tolerably good roads.

    We have been given some reasons for this delay ranging from various lawsuits in the courts to the need to secure adequate funding. The way things are going on in this country, we may die under the weight of irresponsible litigations. As for the lawsuits, there is need for out of  court settlement. The owner of the company suing the government is a well known patriot. Certainly, he will not like to be associated with a situation that has led to the death of many innocent struggling Nigerians whose only crime if crime it is, is that they  are struggling for their economic sustenance through the use of this jinxed road. This trajectory of out of court settlement must be embarked upon immediately. It is not one of these issues that must be allowed to linger on indefinitely. We just cannot wait. Any further deaths on the road is blood in the hands of those who should fix the road. If out of court arbitration fails, this government should be strong enough to damn the consequence in the public interest. I mean heaven will not fall! The government which owns the land should declare the company a trespasser and build the road. Enough of Turenci!

    I do not know how difficult it is for this government to borrow money for high priority and urgent infrastructural development. I am sure a loan can be easily syndicated through a consortium of banks that are daily declaring humongous profits. Funding a project like this should be regarded as part of their corporate social responsibility and support for  national economic recovery. If banks for whatever reasons would not lend to government, then the pensions commission should be approached to invest part of the trillions of Naira pension fund on the project on purely commercial basis. Their investment would be recovered by tolling the road and giving the power to collect the tolls to reputable banks rather than to government agencies to avoid sure and certain embezzlement.

    In a depressed economy like ours, road construction may actually be a panacea for employment and joblessness. In other words, we can kill two birds with one stone. I am therefore suggesting to this government a policy of country-wide road reconstruction as a way of reflating the economy, using if necessary, local banks as funding agencies and making sure all the roads are tolled. Priority roads all over the world are built and maintained in this way thus ensuring that road users pay for construction and maintenance of national highways. What Nigerians want is functionality of infrastructure. When available our people are prepared to pay for services. In the process of constructing these roads, young Nigerian civil engineers must be allowed to work along with whatever companies are given the contracts so that in future there will be a pool of people knowledgeable in road maintenance. The time has also come when we should begin to use interlocking cement and stone blocks in making critical roads to ensure  that they last long. This  policy  easily recommends itself because of our recent self-sufficiency in cement, thanks in this respect to private entrepreneurs like Dangote and Lafarge. I have said it before and I will say it again: one of our problems in Africa is that we are slaves to economic  orthodoxy. If something has not been done before, we are not prepared to try it yet the only way we as a country can make a mark in this world is to travel  the path least travelled. The greatest resource a country can have is its people. If well trained, they can be mobilized with committed and dedicated leadership to take their country to the highest point of development. We cannot say we do not have sufficiently well trained people to accomplish this rudimentary work of road construction.

    An  American academic colleague of mine  wondered recently  why Nigeria  does not have functioning infrastructure, railways, roads, reliable aviation, regular power supply and things that work generally considering the fact that there are Nigerians in the USA helping to build power stations and pipelines carrying fuel  across the country and also participating in the space projects. Nobody has an answer to our situation of arrested development. As I write this, there is pitch darkness where I am. The generator has broken down as any mechanical thing  is bound to do and the so-called privatized power companies have failed to generate and distribute power to my area of the country. Sometimes I worry if my grandchildren will in future be writing about power  after I would have passed on. There is no serious indication that this will not be the case unless God has mercy on us.

    I beg the people in authority to rise to the occasion and reconstruct this Lagos -Ibadan road and stop the carnage. I hope we do not get to a stage in this country when out of our collective frustration, citizens may be forced to take those responsible for this carnage to the world court to face charges of deliberate and premeditated murder of members of the traveling public.

    This article was written before the ghastly accident that took the life of Miss Rosemary Asuquo Nkanta an angel if ever there was one. This innocent soul came all the way from Jos where she was on the NYSC to join her former colleagues in REDEEMER’S UNIVERSITY  in FEAST of PRAISE (FOP) She was on her way to Lagos to fly back to Jos. She never made it. She was involved in an accident that took her life  near Sagamu.  She graduated First Class last September. The Nigerian condition killed this innocent soul. May God forgive all those who were directly or vicariously responsible for her death. Adieu Rosemary. May God condole your parents and all your friends and teachers at Redeemers University. You were one in a million.

     

    Corrigendum 

    My article on the Polisario Front last week contained an error. Instead of UNITA I wrote SWAPO. The Nigerian General who commanded UN troops  was Major – General Chris Garba. I omitted his first name.

  • 17 die in Lagos-Ibadan Expressway accident

    17 die in Lagos-Ibadan Expressway accident

    Seventeen people died and 74others injured in an accident on the Lagos-Ibadan Expressway yesterday morning.

    The accident, which occurred shortly after Ibadan, involved two vehicles.

    There were 96 people inside the vehicles.

    The Federal Road Safety Commission (FRSC) gave the cause of the accident as over speeding, which led to loss of control by one of the drivers.

    FRSC’s Head of Media Relations and Strategy Bisi Kazeem, in a statement, warned people “against sitting on top of trucks and lorries”.

    Kazeem said: “The accident  occurred around  SEPO Area before Dominion University, KM 19 at 0915.

    “Two vehicles were involved– a DAF Trailer White, Reg. No. XS626 LSD and another articulated truck.

    “It was caused by speed violation and loss of control. There were 96 people involved (95 men, one woman.

    “Seventy four were injured; 17 died. The victims have been taken to UCH, Ibadan Central Hospital, Kejide and Life Back Hospital.

    “The bodies have been deposited at the Adeoyo Morgue, Yemetu, Ibadan.”

  • Lagos-Ibadan: How Bi-Courtney’s arbitration was ignored

    Lagos-Ibadan: How Bi-Courtney’s arbitration was ignored

    •Fashola steps into controversy

    It was learnt yesterday that the rehabilitation of the Lagos-Ibadan Expressway suffered a setback because the Federal Government failed to respond to demand for arbitration by Bi-Courtney Highway Services Limited.

    Sources said the Minister of Works, Mr. Babatunde Fashola (SAN), has stepped into the deadlock and the government may revisit the arbitration.

    The Federal Government, in November 2012, terminated the 25-year concession given to Wale Babalakin’s Bi-Courtney Consortium for the construction and maintenance of the expressway.

    The highway was conceded to Bi-Courtney in 2009 at N89.53 billion for 25 years.

    The ex-Minister of Works, Mr. Mike Onolememen, said the concession agreement was revoked because Bi-Courtney failed to adhere to the terms.

    In June 2013, the Federal Government re-awarded the reconstruction of the expressway to Julius Berger Plc and RCC.

    In July 2013, President Goodluck Jonathan kicked off the reconstruction at a cost of N167 billion, with a completion timeline of 48 months.

    Investigation showed that Bi-Courtney Highway Services Limited, on January 25, 2013, wrote Oneolememen for arbitration.

    But three years after, the Federal Government is yet to take action on the matter.

    The Bi-Courtney’s letter, which was signed by Chief T.K. Akinbami, said: “We refer to the letter of November 19, 2012, wherein the concession granted to our consortium vide your letter of May 8, 2009, was purportedly terminated pursuant to Article 16.1 of the Concession Agreement (“Agreement”) for failure to remedy the alleged breaches complained of in your letter of August 28, 2012.

    “Please note that the consortium disputes the purported termination of the concession. We refer to our letter of September 26, 2012 (copy attached) wherein we responded seriatim to issues raised in your letter ofAugust 28, 2012, and demonstrated that the ministry’s purported notice of the non-compliance with the Agreement is premature and invalid. We also emphasised the need for the Grantor to comply with the Agreement before it alleges non-compliance by another party.

    “Notwithstanding, as committed patriots to the development of Nigeria, we continued with the project and recommended palliative works of August 5, 2012. Subsequently, we engaged a major construction company to commence actual reconstruction work on September 23, 2012, and the company was active on site, until our receipt of the letter purportedly terminating the Concession.

    “We believe that a dispute has arisen which should have been resolved in accordance with the dispute resolution mechanism under Article 21 of the Agreement prior to the invocation of any termination clause. In the circumstance, we demand that the Dispute Resolution Board  (“the board”) be set up, to determine the propriety or otherwise of your action under the Agreement. We hereby appoint the underlisted as our nominees to the Board.

    1. Mr. Justice G.A. Oguntade, retired Justice of the Supreme Court of Nigeria
    2. Prince Adesupo Adetona; retired senior partner of Deloitte
    3. Mr. B.G Giwa; former acting director Federal Highways

    “Kindly appoint your nominees to the Board within 14 days of your receipt of this letter. As you are aware, this should have been done earlier in the transaction.

    “For the avoidance of doubt, we reiterate that your purported termination of the Concession is, according to law, invalid and should be discountenanced by relevant parties.”

    A top source in government said: “The Minister of Works has stepped into the controversy or challenges associated with the rehabilitation of Lagos-Ibadan Expressway.

    “I am aware the government is revisiting all issues on the project, including the likelihood of concluding arbitration with Bi-Courtney.

    “Fashola’s agenda is to see that the project is fully back to life and completed on time.”

    Last week, the Minister of Works, Mr. Babatunde Fashola (SAN) admitted that the Federal Government was concerned about the lingering litigation on the Lagos-Ibadan Expressway.

    He said: “The Lagos-Ibadan Expressway is a story of what investors don’t like. The FGN granted a concession to a private company (Company A) and later withdrew and cancelled it. The FGN then entered into a construction and financing agreement with another company (Company B). Company A went to court and got an order to cancel the financing agreement with Company B.

    “As things stand, work has been stopped on the construction of the road. The construction companies cannot get financing because of the court order, so they have laid off about 2,000 workers, in an economy that has so much to do and needs to create work.

    “These two companies are Nigerian companies investing in Nigeria, which is a positive sign because the local investors are the most important to any economy.

    “Regrettably, while not going into the merits and demerits of the FGN’s cancellation of Company A’s “concession”, it sends a not-welcoming message to foreign investors if the decision was without basis or influenced by politics, which I cannot comment upon.

    “If that was the case, as a foreign investor, I will be asking myself the kind of treatment that awaits me as a foreigner if the government does that to a citizen. But that is only one half of the story.”

  • Lagos-Ibadan Expressway

    Lagos-Ibadan Expressway

    •The Federal Government should find a solution to the legal minutiae of the deal and complete the road

    The delay in rebuilding the Lagos-Ibadan Expressway, perhaps the busiest highway in the country, after several promises and attempts in the past decade, is unacceptable. We had several times condemned the regimes of Presidents Olusegun Obasanjo, Umaru Yar’Adua and most recently Goodluck Jonathan, for paying lip service to the urgent need to stop the daily loss of lives and properties worth several billions of naira on that road, arising from the accidents at its failed portions . To compound an already bad situation, a Federal High Court sitting in Lagos has reportedly set aside a purported new concession agreement on that road.

    The suit was instituted by Bi-Courtney High Way Services Limited that originally signed a concession agreement to build, operate and transfer the highway, an agreement purportedly cancelled in 2012. Before the cancellation, the Federal Government had claimed that Bi-Courtney had showed total lack of capacity to keep to its obligations in the agreement, while the company maintained that the Federal Government and its agencies had undermined the agreement in many respects, and as such had canvassed that the cancellation did not follow due process, and  was therefore illegal.

    Now, a high court has set aside the new concession purportedly made by the Federal Government in favour of Motorway Assets Limited (MAL) in January, 2015; even as the Infrastructure Concession Regulatory Commission (ICRC), a Federal Government regulatory agency, reportedly earlier this month denied any new concession to MAL. But amazingly, MAL early last month issued a statement that it was trying to raise the sum of N150 billion, as the second tranche of funds for the highway project, on the basis of a concession agreement in favour of the company by the Federal Government, on a build, operate and transfer basis.

    With claims and counter-claims by the contending concessionaires, the glaring inefficiency on the part of the agencies of government, not to talk of the palpable inertia on the part of the previous governments, are we likely to see a rebuilt Lagos-Ibadan Expressway anytime soon? That will depend on President Muhammadu Buhari and his new Minister of Power, Works and Housing, Babatunde Fashola. On our part, we expect the Federal Government to speedily untangle and resolve the contending issues, so that work can resume on site by the lawful concessionaire.

    As we noted, several lives and properties have been lost on this highway principally because the road at several portions had completely failed. On many such instances, trucks carrying fuel and other highly inflammable contents splash their contents on the highway, and at such occasions, the expressway turns into a convoluted hell fire, that often claims limbs, lives and properties. This should stop.

    To do this, the Federal Government, the contending concessionaires and the responsible agencies of government must quickly come to a compromise in accordance with the provisions of the law and due process so that that important national artery that links the nation’s economic capital with the north, south, east and western parts of the country could be properly rehabilitated for the good of all road users.

    With a senior advocate as the minister of works, we expect that all the legal loopholes would be plugged this time. If the Federal Government does not have the requisite funding capacity for the project, it should enter into an iron-cast concession agreement with a partner that has the requisite capacity to deliver on schedule. All over the world, public-private partnership has proved a veritable means of addressing infrastructure challenges, and there is no reason why the Lagos-Ibadan Expressway should continue to suffer neglect.

  • ‘No new concession on Lagos-Ibadan Expressway’

    No new concession has been granted on the reconstruction of the Lagos-Ibadan Express-way, the Infrastructure Concession Regulatory Commission (ICRC), has said.

    In a statement, the Head, Communications, ICRC, Ms. Deborah Okafor, said: “ There has been no new concession  granted  as  required  by law and the National Policy on Public Private Partnership on Lagos Ibadan expressway,” adding that reports that Government  has  granted  a  new  ‘secret concession’ on the expressway  through  “a  back  door  arrangement,” are false.

    She  said after the termination of the concession granted to Bi-Courtney  Highway  Services  Limited,  the Federal Government decided to reconstruct  the  Lagos-Ibadan  expressway  as  a  traditional  procurement through  Engineering,  Procurement  and  Construction (EPC), adding however that the  govern-ment could not wholly  finance the project and had secured private financing from a consortium of banks to ensure the speedy completion of the road.

    According to her government  is  bound  to  repay  the financing arrangement (such as interest  payments, loan repayment, fees, charges and associated returns on equity  investment)  either  through  the  annual  budgetary system, or from revenues  accruable  to Government if the operations and maintenance of the road is granted as a concession to a private party.

  • No new concession on Lagos-Ibadan Expressway, says ICRC

    No new concession has been granted on the reconstruction of the Lagos-Ibadan Express-way, the Infrastructure Concession Regulatory Commission (ICRC), has said.

    In a statement, the Head, Communications, ICRC, Ms. Deborah Okafor, said to the “best of its knowledge, there has been no new concession  granted  as  required  by law and the National Policy on Public Private Partnership on Lagos Ibadan expressway,” saying news reports that Government  has  granted  a  new  ‘secret concession’ on the expressway  through  “a  back  door  arrangement,” are false.

    She  said after the termination of the concession granted to Bi-Courtney  Highway  Services  Limited,  the Federal Government decided to reconstruct  the  Lagos-Ibadan  expressway  as  a  traditional  procurement through  Engineering,  Procurement  and  Construction (EPC), adding however that the  government could not wholly  finance the project and had secured private financing from a consortium of banks to ensure the speedy completion of the road.

    According to her government  is  bound  to  repay  the financing arrangement (such as interest  payments, loan repayment, fees, charges and associated returns on equity  investment)  either  through  the  annual  budgetary system or from revenues  accruable  to Government if the operations and maintenance of the road is granted as a concession to a private party.

    If  and  when  the  Federal Government decides to grant concession over the operations  and  maintenance  aspect  of  the  project,  the  ICRC,  as the regulatory  agency,  will  ensure  that the project passes through a normal competitive  process  as  provided  for under the Infrastructure Concession Regulatory Commission (Establishment, Etc) Act, 2005 Act, (the Act) and the National PPP Policy on Public Private Partnership.

    The ICRC wishes to state further that: a) Any  PPP structuring over the Lagos-Ibadan Expressway can only take place  after the ongoing reconstruction is completed and handed over to the Federal Government.

    The  Federal  Ministry  of Works would then commence the process of procurement  of  a  competent  project  proponent  to  handle  the Tolling,

    Operations  and  Maintenance  of  the  road  in compliance with the Act and Policy,  which  requires that such a process must be done competitively and transparently.

    Any new concession over the road must, in due course, be certified by ICRC to have complied with the Act and Policy.

  • Lagos-Ibadan Expressway: The Fashola factor

    Like a winding way, the Lagos-Ibadan Expressway presents twists and turns. Another development has further complicated the ongoing reconstruction of the Lagos-Ibadan Expressway and reinforced earlier complications. In the news is a new concession claim that is surprising and thought-provoking.

    An October 22 report said: “The Ministry of Works has said that the contractor handling Section II of the Lagos-Ibadan Expressway reconstruction and expansion project, Reynolds Construction Company, RCC, was facing challenges of finance, adverse weather and impatience of motorists. Mr. Nelson Olubakinde, the representative of the Ministry, told newsmen in Ibadan: “The construction company (RCC) is facing challenges of finance, weather, especially rain, and impatience on the part of road users often resulting in accidents within work location.”

    The report also said: “Olubakinde, however, said that the construction effort was under Public Private Partnership, PPP, arrangement with Motorway Assets Limited as leasee, while the ministry was the guarantor.”

    The confusion was compounded by a November 11 report which said: “Oyinloye was quoted in a newspaper report on November 4 as saying: “Motorways Assets Limited has been given consideration for the project. The Infrastructure Concession Regulatory Commission has to give the concession certificate, while the lenders and investors have to ensure that all the details are properly worked out. We have now got all the relevant approvals.” Mr. Adekunle Oyinloye is Managing Director of the Infrastructure Bank Plc.

    The question is: How did MAL get into the picture?  It is noteworthy that the Lagos-Ibadan Expressway has moved from controversy to controversy, especially following the Goodluck Jonathan administration’s 2012 termination of a concession agreement with Bi-Courtney Highways Services Limited (BCHSL), which was supposed to reconstruct and manage the toll road. The past government alleged that the company failed to make progress on actualising the objective of the concession four years after the agreement signed with a preceding administration.

    It is two years since the Jonathan administration in July 2013 rearranged the reconstruction, following a N167 billion contract, awarded to Julius Berger Nigeria Plc and Reynolds Construction Company Limited. Under the new arrangement, two sections of the expressway will be reconstructed: Section I (Lagos to Sagamu Interchange) and Section II (Sagamu Interchange to Ibadan).

    The 127.6-km-long Lagos-Ibadan Expressway dates back to 1978. Apart from connecting Ibadan, the capital of Oyo State, and Lagos State, Nigeria’s economic capital, the road is the busiest inter-state road, and it is a main link to the northern, southern and eastern regions of the country.

    According to Bi-Courtney, “We are in court because the alleged cancellation of the concession did not follow due process. Apart from that, the so-called contract involving the two new companies handling the project was awarded arbitrarily without a bidding process.”  The company said:  “BCHSL won the concession to reconstruct and manage the toll road for 25 years. It’s a Design, Build, Operate and Transfer (DBOT) arrangement. According to the concession agreement, the road will be expanded to 10 lanes from Lagos to Sagamu and six lanes from Sagamu to Ibadan. Because of this expansion, structures that fall within 60.35 metres from the median on both sides of the road will be demolished, and government will compensate owners of the affected properties.”

    The company proudly argued that it rebuilt the Murtala Muhammed Airport (MMA2) in Lagos “against all odds”. “It is the first airport in Africa to be owned by a private company on a Build, Operate and Transfer (BOT) basis, the first of its kind in Nigeria, and it was delivered far ahead of schedule,” Bi-Courtney said.

    The company’s response to the allegation of non-performance blamed work delay on the Jonathan administration. In the period of three years and six months that the company had the concession, it was slowed down for two years and 10 months. According to the company, the design process which was expected to be completed within four months took 18 months as a result of bureaucratic bottlenecks at the Ministry of Works. The Infrastructure Concession Regulatory Commission (ICRC) corroborated Bi-Courtney’s position.

    From the look of things, the announced cancellation of the concession by the Ministry of Works on November 19, 2012, was the culmination of a chain of unprogressive manoeuvres resulting from behind-the-scenes influence.  While the delay lasted, Bi-Courtney said, “We were advised by the ministry not to do any serious works on the road other than palliatives”.  Before the concession was terminated, the company claimed it “had completed the patching and overlaying of bad portions of the highway, preparatory to full-scale reconstruction”.

    It is interesting to note the new language describing MAL as “leasee” and the reference to Public Private Partnership (PPP). The old understanding was that the contract involving Julius Berger Nigeria Plc and Reynolds Construction Company Limited is not a concession unlike Bi-Courtney’s, with the implication that the federal government is expected to fund the road rehabilitation and operate the toll road. With MAL in the picture now, has the picture changed?

    Of course, it is open to debate whether adopting the concession model for the rehabilitation of the expressway promises greater socio-economic benefits than the old way of doing things. However, the attraction of the Public-Private-Partnership (PPP) approach, which the concession concept represents, cannot be reasonably discounted in a modern economy, considering reported examples in Western Europe and the U.S. where private investors are involved in infrastructure development based on concession agreements.

    The PPP appeal is highlighted by a recent report: “Contractors handling over 184 federal road projects have abandoned the various sites due to lack of funding from the Federal Government and the huge debt owed them by the Federal Ministry of Works.”  The Lagos-Ibadan dual carriageway was listed among the roads affected by the funding problem. According to the report, “The contractors said they were owed over N600bn, adding that although part of the sum was owed by state and local governments, over 80 per cent of the amount was owed by the Federal Government.”

    This kind of abandonment seems less likely under a concession arrangement that requires the concessionaire to raise funds for the concerned project, rather than wait for government funding that may make a mess of the project, particularly in the context of dwindling government revenue.

    Against this background, the appointment of ex-Lagos State governor Babatunde Fashola as Minister of Power, Works and Housing, may prove to be a clarifying factor concerning the Lagos-Ibadan Expressway. He has a track record of progressive performance.  Fashola was quoted as saying: “Let us design and build roads that last and houses that will stand the test of time. We want to know if some of those problems are man-made or systemic…We want information on what has been done, what remained to be done, and what are the future plans, we want to continue from there.”