The federal government yesterday signed a Memorandum of Understanding (MoU) with the China Civil Engineering Construction Company (CCECC) for the construction of the Calabar to Lagos railway project at the sum of $11.117billion.
The minister of Transportation, Mr. Rotimi Amaechi, who gave the breakdown of the deal said the signing of the deal was significant because the President Muhammadu Buhari administration successfully renegotiated the contract and arrived at $11.117 billion, after $11.917 billion was initially agreed by the last administration of former President Goodluck Jonathan.
The minister explained that the contract was awarded by the last administration for $11.917billion, but when the Buhari-led federal government took over at the Ministry, it re-negotiated with CCECC and succeeded in reducing the contract sum from $11.97billion to $11.117billion.
He said, “We are able to save $800million after renegotiating with CCECC and that has to do with the fact that the prices of commodities, like steel and others have come down. Therefore, there was the need to also bring down the prices of the project.
“So, we are here today to sign the same contract but with different with cost and we want to make it legal from $11.917 to $11.117 billion”.
Amaechi further noted that, while the target for the completion of the project is two years, the project will commence as soon as the China EXIM Bank gives the approval since they are the ones funding the project.
He said, “As soon as we conclude discussion and negotiation with the China EXIM bank, they will commence construction of the first segment which will be Calabar-Uyo, Aba – Port Harcout, and this will include all the sea ports on this route, but this will be the first segment.
“Meanwhile, the entire contract covers Calabar-Uyo-Port Harcourt-Yenogoa-Otuoke- Ughelli-Warri-Benin-Agbor-Asaba- Onitsha and back to Benin
Ore-Shagamu and Lagos. We believe that why it should go up to Lagos sea port is to ensure that all the rail lines terminate at the sea port. For now all the current sea ports will be covered.
“I thank the CCECC for their cooperation and I hope that this will be completed within two years since funding will not be the problem. Lagos to Ibadan will be concluded in two years and Calabar to Port Harcourt. That will be wonderful and that will be my ambition,” the minister stated.
Meanwhile, President of CCECC, Cao-Bao Gang has described the Lagos to Calabar railway as important to Nigeria’s economic development as it is important for both the South west and South east of Nigeria.
Noting that the project can create more than 5 000 jobs for Nigerians, he also confirmed that the original cost was reduced by $800million, even as he expressed hope that the project will be completed in two years.
Gang added that the Lagos to Ibadan rail project and that of Calabar to Port Harcourt will take two years to complete.
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