Nigeria to recoup $2.9bn Abuja Airport runway repair cost via private ownership

Nigeria to recoup $2.9bn Abuja Airport runway repair cost via private ownership

Findings have revealed how the Federal Government intends to recoup the $2.9 billion to be spent on the rebuilding of the Abuja Airport runway.

To recoup the whopping sum, the Federal Government had, well in advance, concluded plans to hand over part ownership and management of the airport to any willing private firm(s), an investigation has revealed.

The approach will differ from the 10-year old partial privatisation scheme, known as concessioning, which has seen some national assets bought over by some private sector interests.

In the new arrangement, the Abuja Airport will be transferred to a consortium of companies which may not be at parity with the old method that has the Murtala Muhammed Airport (MMA2), concessioned to Bicourtney, Ripples Nigeria has learnt .

It was further gathered that the proposal came from the Transportation Ministry, in June 2016, which through a commiittee recommended two approaches to be considered as a means of recovering the cost of the renovation .

The approaches were: the build, operate and transfer (BOT), which could not sail because of lack of willing partners, as Nigeria is battling with recession.

The second one was the ownership/management transfer scheme (OMTS), which will have qualified firms run the airport after depositing some funds in a special account with the CBN.

“Initially, it was not easy convincing President (Muhamnadu) Buhari on the project in view of the scarcity of funds in the system. But his aides later saw reason to allow the work to go on based on the proposal before them.

“But how to carry the workers’ union along in each approach was the problem the government has been having all the while,” a source said.

Read also:  Finally, Osinbajo-led FG releases economic recovery plan

It was learnt that government adopted the recommendation of the commiittee that sat severally before approval was given for the take off date and cost of the project because of the pressure from IMF that Nigeria should hands off running most national assets.

This assertion was given credence on Tuesday when the Minister of State, Aviation, Senator Hadi Sirika, told a foreign news network that an improved programme for concession would be put in place towards ensuring that the sum of money to be spent in rebuilding the Abuja Airport will not be a waste.

Sirika said an option had opened itself up for government to have most of its airports go into new private investment structure.

“After the Abuja Airport experiment, all government-owned airports will be offered to investors, who have the wherewithal, the know-how, the technology, the capacity, the ability, the finance to put up huge edifices as airports with everything including hotels, just the way you see them abroad,” said the Minister of State.

He failed to go into details as to to when the offer will be thrown open to willing investors.

But the investigations showed that none of the firms handling any of the concessioned assets would be considered in the new bid that may take place later in 2017.

The Bureau of Public Enterprises (BPE) may not even be the sole agency to handle the special concessioning, it was learnt.

Abuja Airport will remain closed till May ending when all its neglected runways are expected to have been fixed, but government is yet to convince most foreign airlines to agree to use the Kaduna airport as an alternative.




RipplesNigeria ….without borders, without fears

Click here to download the Ripples Nigeria App for latest updates

Join the conversation


About the author

Ripples Nigeria

We are an online newspaper, very passionate about Nigerian politics, business and their leaders. We dig deeper, without borders and without fears.

/* ]]> */