.Explains why there was no public tender for contract
.Maintains one kilometre of road to cost N4.329bn, not N8.59bn
.Project is highway to fraud, waste, Atiku insists
Emmanuel Addeh and Chucks Okocha in Abuja
The raging controversy over the 700-kilometre Lagos-Calabar Coastal Highway continued yesterday, with the federal government attempting to explain the allegation of lack of transparency in the award and costing of the critical project that connects the South-west to the South-south of Nigeria.
Speaking on Arise Television, the Minister of Works, Senator David Umahi, insisted that due process was followed in the award of the contract to Hitech Construction Company without going through a public tender system.
Umahi stated that competence and track record, especially given that Hi-tech was instrumental to the reclamation work on the beach in Lagos, were some of the reasons the company was picked.
Former Vice President, Atiku Abubakar, had a few days ago in a statement stated that the project had exposed the current administration’s alleged penchant for dubious and shady deals.
Atiku, in a statement last Sunday, noted that the administration had while making the old project appear new, refused to make public the cost to tax payers.
He maintained that the announcement that the project had been awarded to Gilbert Chagoury’s Hitech Construction Company Limited (Hitech), an alleged friend of President Bola Ahmed Tinubu, without any record of a competitive bidding or a decision by the Federal Executive Council (FEC) smacked of opaqueness.
“Till date, the Tinubu administration has refused to reveal how much the project will cost in total. Umahi, who even came on Channels Television recently, evaded questions as to the total cost of the project.
“But if 47.47km costs about N1.06 trillion, it means each kilometre is being built at N22.5 billion or $18 million. For a project that is going to be 700km, it means the total cost could be N15.7 trillion or $12.56 billion, which is higher than previous estimates,” he argued.
But Umahi argued that if the project was initiated by former President Goodluck Jonathan’s administration and reviewed by the Muhammadu Buhari administration, he wondered what personal interests they were pushing, since Tinubu was being accused of pursuing a personal interest.
He argued that Jonathan put the cost at about $12 billion, but was renegotiated by Buhari to around $11.1 billion.
He pointed out that one way to tackle inflation, was to look at investment in infrastructure, stressing that that was exactly what the president was doing. “So there’s no personal interest associated with that,” he explained.
On whether the project couldn’t have started from Calabar, rather than Lagos where it is likely to cause disruption to the Landmark Beach project, the minister explained that was the original plan. “We didn’t call it Calabar-Lagos-Coastal Road. You called it Lagos-Calabar-Coastal Road, which means that there is a zero point,” he added.
He emphasised that Chagoury’s Hitech was picked because of its capacity, insisting that there’s a part of the procurement law that allows the government to pick contractors based on skills, rather than least cost.
“You have a section of the law that allows you to procure a particular project based on the skills a company has,” he pointed out, citing the case of 3rd mainland Bridge that was awarded to Julius Berger because they have specialty in that aspect of work.
“So we invited them based on procurement act. And so the way you are doing such invitation, there must be proof of track record of a company that has done such works. And so they gave us a quotation. We ran it with them,” the minister explained.
He argued that handing over the project to Hitech remains an advantage to Nigeria because not only did they stop the flooding along the axis, they also reclaimed a lot of land and have turned it to another Dubai.
The minister also disputed the figures churned out by Atiku, maintaining that the basis for his analysis was wrong and that it was about N4.329 billion per kilometre.
“Now this design on which he (Atiku) based his analysis is bound to fail. Now, I run my design. My design has 10 lanes and a total pavement of 59.2 metres. The other corridor is 52 metres, my corridor is 100 metres. And out of these 100 metres, you have 5 lanes on left side, 5 lanes on the right side.
“And then you have 25 metres for train track. Now our train is not starting at zero, because we reduced the corridor there. And even up to the landmark, we still reduced to 50 metres.
“Our design has 7.63 metres. Additionally, if you look at the design that he predicated his own and you use N1,200 per dollar, then, first of all, if you use 23 metres, you divide it by 11.55, the standard gauge for a superhighway. Then you get that this design is 2.225 multiple superhighways.
“So it means that in this design, you have the standard highways to be 11 or 2.22. Now, in my design, I have my own to be 5.167. Which means that in every cross section, you have a standard highway of 11.55 to be 5.167. Now, if you divide 700 kilometres by this 11.11 by 700 kilometres, you get N19.1 billion per kilometre. If you divide them by $11.1 billion, you get this one at N19 billion per kilometre.
“And this kilometre is, 2.22 multiples of standard gauge. Now, when you divide this N19.1 billion by this multiple gauge, you get N8.59 billion per kilometre. So, if you have a total pavement of 23 metres, how much of it is the multiples of a standard gauge?
“And so, if you divide it by standard gauge of 11.55, you get that at every section of the road, what you have is 2.225 multiples of a standard gauge. So, when you have a cross-section per one kilometre of N19 billion, and then you now divide it by the multiples, you will know how much this thing is going to cost me if it were to be Lagos-Ibadan dual carriageway?
“So, it is going to be 2.225. So, you divide that N19 billion by 2.225, and you get N8.59 billion. That is what a standard gauge of this kind of construction is going to cost. My number is, you know, a total of 59 metres width in total pavements.
“And at the end of the day, there’s no comparison. Apart from the cost elements that this one is cheaper by what he’s saying by half. My own is N1.06 trillion and if you divide it by 47, you will now multiply by 5.167, my multiple standard gauge. And then you will now have N4.329 billion per kilometre of standard gauge. That’s what I’m doing.
“My own standard gauge has a lot of advantages, one is reinforced concrete, two, it has a lifespan of between 50 to 100 years. Three, it is suitable for the coastal road because of high water table, because concrete is very good with water.
“This (the initial design) cannot stand the test of time. Tell me any asphalt road that was built in this country that has stayed for 10 years? “, he asked, adding that the rail component has not been estimated.
According to the minister, aside the Lagos axis of the project, other axes that criss-cross the other states were yet to be ‘costed’
Umahi explained that nobody can talk about the commercial integrity of a project without talking about its technical integrity. “That’s the first thing you must consider, ability to do the job,” he observed.
“So the issue of competitive bidding is in line with the Procurement Act, and we followed the Procurement Act. And the reason for competitive bidding is, one, to have a company that has the integrity, stability, and capacity to do a job, and then, number two, to have value for money. And we have those indices. We have them in abundance in this project,” he insisted.
Umahi argued that no job will be lost in the construction process as being speculated, explaining that the 12,000 jobs being bandied about was just a baseless figure.
He said that by law, the federal government owns 250 metres shoreline, stressing that because the government was taking only just 50 metres, all Landmark Group’s facilities were still in tact.
“His facilities are all intact because we reduced the corridor to 50 metres. There’s no permanent structure other than few shanties along that route. No single job will be lost because of this,” he assured.
He explained that although the land belongs to the federal government, but because of the investment there, it decided to take just 50 metres out of the 250 metres that it ordinarily has a right to.
The owners of the beach had appealed to the federal government to allow the road take its original route so that its investment in Landmark Beach will not be destroyed.
According to the specification, the 700-kilometre coastal highway project is designed to connect Lagos to Cross River, passing through the coastal states of Ogun, Ondo, Delta, Bayelsa, Rivers, and Akwa Ibom, before culminating in Cross River.
The first phase of the project that will run through the nine coastal states is the 47.47km section, beginning from Victoria Island. It has five lanes on each side of the dual carriageway and a train track in the middle.
Starting from Ahmadu Bello Way, Victoria Island in Lagos, the coastal road, would have two spurs that would link up with Northern Nigeria to further integrate the North and South in terms of movement of people, goods and services. Government says part of the funding will be sourced by Hitech, the contractors.
Meanwhile, Atiku, yesterday again described as wasteful and a ‘highway to fraud’ the claim by Works Minister, Umahi, that the highway will tentatively cost N15.6 trillion.
Atiku also knocked Umahi for altering the initial plan of the project after Gilbert Chagoury’s Hitech had been awarded the contract without any competitive bidding.
He said: “Umahi had announced that the project would be fully funded by Hitech, and based on this, there was no competitive bidding. He (Umahi) then turned around to say that Hitech could only raise just 6 per cent of the money for the pilot phase. This smacks of deceit.”
Umahi had during his media rounds at select TV stations said the road project would cost N15.6 trillion ($13bn at exchange rate of N1,200/$1) while the rail which will pass through the road will be estimated separately. The minister had also said the government would be providing 15 per cent to 30 per cent counterpart financing.
Responding to Umahi’s revelation, Atiku said the tentative cost was the equivalent of the
total budget of all 36 states of the federation combined.
He said: “The total budget of all 36 states of the federation for 2024 stands at about N14 trillion. If you add that of the FCT, the entire budget of all sub-nationals is N15.91 trillion. This is scandalous. Worse still, they have already awarded the contract, but are still not sure of the level of the counterpart funding component of the federal government.
“Umahi had said in September 2023 that Gilbert Chagoury’s Hitech had the money to construct the highway and that it would be PPP. Hitech was to build, operate, and transfer it back to the Nigerian government after years of tolling.
“It was reported by every media organisation, including those owned by Tinubu. It was on the basis of this proposal that Hitech was picked. Why did Umahi then turn around to claim that it was not to be a PPP but that the government would pay 15 per cent to 30 per cent”
The former vice president noted that in the 2024 budget, the project was captured as the Lagos-Port Harcourt coastal highway and was put at a cost of N500 million.
“Although the National Assembly approved N500m for the project this year, the Tinubu administration has released N1.06 trillion. That is more than 200 times what is in the appropriation act. This is what happens when the National Assembly fails in its duties,” he added.
Atiku said it was curious that the N15.91 trillion announced by Umahi did not include the cost of the railway component. He therefore wondered how much the project would cost if the railway component is included.
“If N15.6 trillion is for the road component alone, then the total cost could be far higher when the railway is included. We want to know the cost of the railway,” he said.
The PDP presidential candidate also lambasted Umahi for admitting that the project was given to Hitech construction company without a competitive bidding.
He asked Umahi to stop trying to deceive Nigerians with the claim that only Hitech was competent enough to do the project, wondering if it is the same that has been grappling with the execution of its projects in Lagos.
The former vice president stated: “The essence of a competitive bidding is so that Nigerians can get the best value for money. It is so that you can compare prices and pick the company that can afford the project.
“It is wrong for him to have concluded that only Hitech could handle this project when such a project has been done by other reputable firms in the United States, China and South Africa.
“He claims he didn’t know there was a business relationship between Gilbert Chagoury and Tinubu, but this is another lie because Tinubu has publicly acknowledged this fact,” Atiku stressed.
Atiku called on members of the National Assembly to be alive to their responsibilities instead of acting like an annex of the presidency.
“Until I exposed the dubious nature of this project, no member of the National Assembly thought it wise to investigate. The total cost was never made known until now. The fact that there was no bidding was never made known until I blew the whistle,” Atiku pointed out.
The former vice president also knocked Umahi for claiming that no money had been released yet to Hitech, which he described as another lie.
He said: “On March 31, 2024, Umahi came on Channels Television’s Sunday Politics programme where he pointedly said that the sum of N1.06 trillion was released to Hitech. Only for him to say on TVC on April 11 that the same money been released. Which one is true, and which one is false?”
