FEC Okays $2.99bn Light Rail Projects For Lagos, Kaduna, Kano to Boost Economy

• Resolves 20-year-old MM2 dispute, approves aircraft leasing firm to boost aviation sector 

•Bi-courtney writes off N132bn claim, relinquishes MM1 control  

•Unveils power reform task force, defends road costs as Lagos Carter bridge’ll be pulled down and reconstructed

Deji Elumoye in Abuja

The Federal Executive Council (FEC) rose from its meeting on Thursday with the  approval of three major rail infrastructure projects valued at $2.99 billion.

This was part of government’s move aimed at accelerating Nigeria’s transport modernisation drive and strengthening economic connectivity across key urban corridors.

Minister of Finance and Coordinating Minister of the Economy, Prof. Taiwo Oyedele, who made the disclosure while briefing newsmen after the FEC meeting presided over by President Bola Tinubu at the State House, Abuja, listed the approved projects to include the Lagos Green Line Rail, the Kano State Metro Rail, and the Kaduna State Rail project each designed to ease urban congestion, enhance mobility, and stimulate regional economic activity.

Oyedele added that the projects have already been captured in the extended 2025 budget and are expected to strengthen the capital component of the overall investment framework.

His words: “The Federal Executive Council approved three transformative rail project and these are Lagos Green Line, Kano state metro city rail project and Kaduna State Rail project. The projects are to be sponsored by the Ministry of Finance incorporated.”

The approvals, the Minister added, align with the administration’s broader infrastructure agenda, which prioritises rail development as a cost-effective and sustainable alternative to road transport.

The Lagos Green Line is expected to complement existing urban rail initiatives in Lagos, Africa’s largest city, while the Kano and Kaduna rail projects are projected to boost commercial activity in northern Nigeria by improving passenger and freight movement.

FEC also approved the resolution of the age-long concession dispute surrounding the Murtala Muhammed Airport Terminal Two (MM2) in Lagos, alongside the establishment of a Nigerian aircraft leasing company to support local airlines.

Minister of Aviarion and Aerospace Development, Festus Keyamo told newsmen that FEC approved two major memos presented by the aviation ministry, describing both decisions as “significant milestones” for the sector.

He disclosed that the federal government has finally settled the over 20-year dispute with Bi-Courtney Aviation Services Limited, owned by renowned businessman,  Wale Babalakin, over the MM2 concession.

According to him, the dispute, which spanned multiple administrations, involved several contentious issues, including the control of the domestic terminal (MM1), financial claims against the government, and exclusivity rights.

“As you all know, there has been a long-standing dispute between the concessionaire and the federal government over MM2. Today, I can happily tell you that this government has resolved that issue once and for all”.

He explained that one of the major sticking points was a Supreme Court judgment which awarded Bi-Courtney N132 billion in damages, with interest accruing from 2009.

Keyamo, however, revealed that the concessionaire agreed to waive the claim as part of the negotiated settlement.

“The first thing we told him was to write off the N132 billion plus interest. Nobody is going to pay that, and he agreed and wrote it off,” the minister stated.

He added that Bi-Courtney also relinquished its claim to the Murtala Muhammed Airport Terminal One (MM1), which it had argued was included in the original concession agreement.

“We told him to hand back the local airport (MM1) to the federal government. We cannot leave the entire domestic aviation operations in Lagos in private hands. He agreed,” Keyamo said.

On exclusivity, the minister said the clause granting Bi-Courtney sole rights to operate a private airport within Lagos was also removed.

“That clause was not right, even for security reasons. He agreed, and we removed it,” he added.

The federal government, on its part, agreed to restore ownership of the long-abandoned Hotel and Conference Centre opposite MM2 to the concessionaire.

Keyamo said the facility, whose construction had stalled for years, must now be completed within two years.

He said: “We gave it back to him to complete and run on a shared basis with the federal government. He has 24 months to deliver it. We will not tolerate further delays”.

He further disclosed that the government will permit regional flight operations from MM2 and expand the terminal’s apron to accommodate more aircraft.

The Minister noted that the new agreement would also ensure that the federal government begins to earn revenue from MM2 operations, which had not been the case during the dispute period.

“At the end of the day, it was give and take. He made concessions, and we also made concessions. Both sides benefitted,” Keyamo said.

He added that a formal signing ceremony involving all stakeholders would be held in Lagos, where full details of the agreement would be made public.

Keyamo also announced that FEC approved the establishment of a Nigerian aircraft leasing company, structured as a Special Purpose Vehicle (SPV), to be driven by private sector investment.

He described the initiative as a “game changer” aimed at addressing the persistent challenge of access to aircraft by Nigerian airlines.

“The major problem of private operators in Nigeria has been access to aircraft and equipment. Nigeria is unique because our aviation industry is almost entirely run by the private sector,” he said.

The Minister explained that the new leasing company would aggregate aircraft for local airlines, reducing their dependence on foreign lessors and improving operational stability.

“Instead of airlines going all over the world looking for aircraft, there will now be a local platform to lease aircraft on both short-term and long-term basis,” he said.

Keyamo noted that many Nigerian airlines currently struggle with leasing arrangements, leading to frequent flight delays and cancellations.

“Some aircraft come into the country and within three months they are gone because operators cannot meet lease obligations.

That is why you see disruptions”.

He clarified that the federal government would not directly fund the leasing company but would provide guarantees to support lease financing and aircraft repossession.

“The role of government is to guarantee the leases. We are not putting in funds, but we will have equity in the company and earn returns,” the Minister explained.

He disclosed that several major African and international investors have already expressed interest in the project, citing Nigeria’s large aviation market and strategic location.

“Investors are already chasing us. We have the market, the traffic, the population and the routes. This is the Nigerian aviation franchise we are selling to the world,” he said.

According to him, the President has directed the Minister of Aviation to work with the Ministers of Finance, Justice, and Trade and Investment to finalise the structure of the SPV.

Keyamo expressed optimism that the initiative would significantly boost the capacity of Nigerian airlines to compete with foreign carriers, which currently dominate about 95 per cent of international traffic to and from Nigeria.

“This is a major step towards empowering our local airlines to take back their market share. In the next few months, Nigerians will begin to see the impact.”

On their part, Information and National Orientation Minister, Mohammed Idris, and his Works counterpart, David Umahi, outlined a set of decisions by the Federal Executive Council (FEC), including the creation of a Presidential Task Force on Power Sector Reform, key federal appointments, and approvals for major road projects nearing completion.

Idris said the Council’s decisions were anchored on a renewed push to reposition the power sector and accelerate infrastructure delivery nationwide.

He disclosed that the Council approved the appointment of a Special Adviser on Power to the President and endorsed the establishment of a high-level task force to drive comprehensive reforms in the electricity sector.

According to him, the decisions followed the submission of a report by a presidential committee set up on March 4 to review the commercial and institutional framework for the proposed Grid Asset Management Company (GAMCO).

Idris said President Tinubu approved the appointment of former Minister of Power, Lanre Babalola, as Special Adviser on Power to strengthen coordination and policy oversight in the sector.

He added that the newly created Presidential Task Force on Power Sector Reform would be chaired by the President, with Babalola serving as a key member.

“The task force is part of renewed efforts by the administration to reposition the power sector as a critical driver of industrialisation and economic growth,” the minister said.

Membership of the task force includes the Minister of Finance and Coordinating Minister of the Economy, Minister of Power, Minister of State for Petroleum Resources (Gas), Minister of Industry, Trade and Investment, Minister of Information and National Orientation, and the Attorney-General of the Federation and Minister of Justice.

Others are the Chairman of the Nigerian Electricity Regulatory Commission (NERC), as well as representatives of electricity generation and distribution companies.

The Minister noted that the committee would focus on implementing far-reaching reforms to address longstanding structural challenges, stressing that stable electricity supply remains central to Nigeria’s economic prosperity.

He added that the government was committed to a total overhaul of the sector to unlock industrial growth and improve the quality of life for Nigerians.

Idris also disclosed that the FEC meeting was preceded by the swearing-in of a National Commissioner of the Independent National Electoral Commission (INEC) and four Permanent Secretaries.

“The President today performed the swearing-in after her clearance by the National Assembly as a National Commissioner of INEC in person of  Rear Admiral K. M. Marafa (rtd).

He added that the Council deliberated on a 32-point agenda and formally welcomed the newly appointed Minister of Finance and Coordinating Minister of the Economy, Mr Taiwo Oyedele, to his first FEC meeting.

“Let me unveil to you for the first time at the FEC meeting, the Honourable Minister of Finance and Coordinating Minister of the Economy, Mr Taiwo Oyedele, who is joining us for the first time. Welcome to the Federal Executive Council,” he said.

Commenting on nation’s infrastructure, Umahi defended the cost of ongoing and newly approved road projects, insisting that they reflect value for money despite rising construction costs.

“When people talk about cost, we must look at unit pricing and quality. What we are doing now is cheaper and far more durable than what was done years ago”.

He explained that the administration has standardised the use of continuously reinforced concrete pavement (CRCP) for federal highways, describing it as more durable and cost-effective over time.

According to him, several newly approved projects average about N3.2 billion per kilometre, even amid increases in cement prices.

Umahi disclosed that 10 major projects approved by FEC are spread across the country and structured to maximise economic returns while addressing long-standing infrastructure gaps.

He said flagship projects such as the Sokoto-Badagry Super Highway and Lagos-Calabar Coastal Highway are being executed using concrete technology, while key legacy corridors are being expanded to improve connectivity.

The minister cited the Akwanga-Jos-Bauchi road, now extended to link Gombe, Yobe and Borno states, bringing its total stretch to about 700 kilometres.

On the Carter Bridge in Lagos, Umahi said structural assessments confirmed that the facility could not be salvaged, prompting approval for a complete reconstruction.

“This is not just rehabilitation. It is a complete rebuilding to modern standards,” he said.

He added that the government is leveraging alternative financing models, including tax credit schemes and tolling, to ensure sustainability.

“This is infrastructure as investment, not just expenditure”.

Umahi further disclosed that several completed projects are ready for commissioning, including sections of the Abuja-Kaduna highway, as well as key routes in the South-South and coastal corridors.

According to him, segments of the Kano-Jigawa and Suleja-Minna roads have been completed, with the Azeri section of the Kano–Jigawa corridor, spanning about 37 kilometres, fully delivered and awaiting inauguration.

He attributed the scale and pace of infrastructure delivery to President Tinubu’s hands-on approach to governance.

“Mr President is extremely detailed. Every item is interrogated. That is why we can confidently say Nigerians are getting value,” Umahi said.