Wednesday, 28th September 2022
Breaking News:

Obasanjo awarded Abuja rail project without design, MOU, says Senate panel

By Segun Olaniyi, Abuja
16 February 2016   |   1:22 am
FORMER President Olusegun Obasanjo awarded the Abuja Rail Project in 2007 with neither a design nor a Memorandum of Understanding (MoU), according to the Senate Committee on Federal Capital Territory (FCT).


• Contract inflated by N2b per kilometre
• Lawmakers demand refund of N392b
FORMER President Olusegun Obasanjo awarded the Abuja Rail Project in 2007 with neither a design nor a Memorandum of Understanding (MoU), according to the Senate Committee on Federal Capital Territory (FCT).
The then Minister of FCT and current governor of Kaduna State, Mallam Nasir el-Rufai, was said to have signed the contract based on an uncalculated estimate.

The revelation came as the committee discovered the contract, which stood at 60.67 kilometres, was inflated by $10 million (about N2 billion at N200 per dollar) per kilometre even as the length was later reduced to 45 kilometres without the refund of the cost for the 15.67 kilometres dropped.

To this end, the Senate committee, led by Dino Melaye has demanded the refund of the of $195,878,296.74 ( about N392 billion at N200 per dollar) being the amount for the 15.67 kilometres cut out from the Chinese Civil Engineering Construction Company (CCECC), handling the project.

The Project Manager of the company, Etim Abak, who answered questions from members of the committee when they undertook an oversight assignment to the project site, said the contract was signed by the then FCT minister without design and MOU, saying it was carried out based on what he simply identified as a conceptual design.

“The contract was awarded based on a conceptual design and estimates were not properly done. There was no formal design submitted and rail bridges and crossover bridges were not captured in the contract, “he told the committee.

According to him, the contract sum was $841.645,898 and project completion period was 48 months while the scope of work was 60.67km standard gauge, with double railway tracks and associated permanent way within FCT.

Melaye , who alleged the whole project may be shrouded in fraud, wondered why the project, whose length initially stood at 60.67 kilometres was later reduced to 45.245 without cut in the cost of the project initially paid for.

Now, you have reduced the length of the kilometre standard gauge from 60.67 kilometres to 45.245 kilometres. Meanwhile, there is no concomitant reduction if you juxtapose the length of kilometres and the reduction in terms of the cost.

“If we are to spend $841 million for 60.67 kilometres and now you have reduced to 45.245 kilometres and the only reduction in terms of monetary value is from $841.6 million to $823 million and with reduction of just about $17 million dollars, that to me is not commensurate with the reduction in length.”

He spoke further: “The Federal Government has so far invested $31.5 billion and another $7.6 billion from the SURE-P fund and if you put these together, we have $39.1 billion invested in the rail project, leaving the balance of $113. 233,155.32million .The sum of $3 billion dollars was proposed in the 2016 budget of the FCT for the rail project.

“ I did a personal research and looked at rail construction of the same specifications , of the same technology across the globe and one cannot but complain that the cost of this railway project in Nigeria is on a very high side.”

Melaye wondered why it was costing the Federal Government so much to construct a railway of just 45 kilometres unlike the construction of the same specifics across the globe.

He also questioned the rationale behind the government’s loan of $500 million from Exim Bank of China for the project, saying the money the Federal Government had so far injected into the project was far enough to execute the entire project.

“From my own calculation, in fact, from my comparison with other rail projects across the world, the Federal Government’s investment in this project is enough to execute the project without taking a loan as high as $500 million from China. Fortunately, one of those projects in Zambia was also done by this same company, CCECC,” Melaye said.