Cost of Outdated Lagos-Ibadan Expressway up by over N300bn, Alleges Babalakin

Chineme Okafor in Abuja

Chairman of Bi-Courtney Group of companies, Dr. Wale Babalakin, Thursday claimed that ongoing construction works on the Lagos-Ibadan Expressway by the federal government was inappropriate and outdated.

Babalakin, whose firm was initially preferred by the government to rebuild the road on a Public Private Partnership (PPP) model which was later called off, also claimed the current construction cost for the road may have shot up to N300 billion as against the N112 billion Bi-Courtney costed to spend on it.

He said these while delivering a lecture as a guest lecturer at the eighth fellowship conferment lecture of the Nigerian Society of Engineers (NSE) in Abuja.

Babalakin, spoke mostly on the need to develop Nigeria’s infrastructure through PPP models considering that the government did not have all the financial resources needed to build and maintain the kind of infrastructure Nigeria currently needed.

“The road being constructed is completely inappropriate and outdated. It is the resurfacing of the 1977 road. It is a road that is inadequate to accommodate the geographic growth that has taken place since 1977,” said Babalakin in his lecture.

He further explained: “The current road cannot contribute meaningfully to the development of road infrastructure. Julius Berger Plc is completing a road that it will never and can never suggest or contemplate building in Germany. Our heaviest traffic road in Nigeria is being built without the necessary accompanying things that should be there.”

According to him, “The cost of the project has now ballooned. It cannot be less than N300 billion and Bi-Courtney had agreed to build the road with seven overhead bridges at the cost of N112 billion. This is a serious waste of resources especially when private capital was available for it.

“Our design appreciated the peculiarities of the road especially the new towns that emerged. We realised that simply resurfacing the road as being done now by the Ministry of Works is a serious disservice to Nigerians.”

Babalakin, stated that when his company submitted its design works for the road, it took the government over 24 months to review it, whereas, it should not take more than eight weeks to review the design under standard procedures.

He also wondered why it had taken the government more than six years to get back to building the road after it cancelled its PPP, adding that the reason the government gave for its decision then was that the concessionaire was slow, yet the government has not been able to prove otherwise.

Based on Babalakin’s claims, THISDAY put a call across to Mr. Hakeem Bello, the Senior Special Assistant on Communications to the Minister of Power, Works and Housing, Mr. Babatunde Fashola, for a reaction but his mobile number was switched off. A text was also sent to him in this regards but no response was gotten from him as at the time of filing this report.

Babalakin, who maintained that adopting the PPP project finance model was Nigeria’s best bet at overcoming her current level of infrastructure deficit, explained that the government also scuttled his company’s plans to comprehensively develop the Murtala Mohammed Airport in Lagos.

He claimed the Federal Airport Authority of Nigeria (FAAN) violated the terms of a concession agreement it signed with Bi-Courteny, and ran another terminal next door to the one it developed.

This, he noted affected the agreement and took away 60 per cent of its traffic, in addition to disrupting its cash flow.

“We went through hell. We were paying back the bank N1.8 billion per quarter and we were generating N300 million per quarter because of the violation of the agreement. We were seeking N1.5 billion from other sources.

“We went to court to enforce our right and the court awarded damages of N132 billion in 2009. The court also ordered that the GAT where Arik, Air Peace and Overland operate totally belong to Bi-Courteny and directed that all the revenue accruing to that terminal should be paid to our company. All the appeals FAAN filed were dismissed, and the breaches continue. I have no doubt that the damages that have occurred today are now in excess of N250 billion,” he explained.

Speaking on how the country could make the most of PPP, Babalakin said it was best the government allowed the Infrastructure Concession Regulatory Commission (ICRC) to do its job, while extant negative thoughts about PPP amongst the government and Nigerians be eradicated.

“The first thing is to eradicate ignorance about PPP. A lot of people claiming to know about the process know nothing about it. The ICRC should be supported to carry out its task.

“We all have to educate ourselves. No country has enough money from the government alone to provide the needs of its people. So, it is better to allow private capital to do those projects that can be sustained as private investments so that limited government funds can be used in other areas that are not commercially viable,” he stated.

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