Lagos is said to be currently operating with a shortfall of 330 million gallons of potable water per day. The production capacity of the Lagos State Water Corporation (LSWC) is put at over 210 million gallons whereas over 540 million gallons are needed daily.
Industry sources say a huge investment of about $ 3.5 billion is required to build additional water schemes. According to the water master plan being executed by the LSWC, a level of stable supply could be achieved by 2020 if the investment of $3.5 billion is made.
With a population estimate of about 22 million people, supply from the water corporation has been everything but reliable. It is believed that over 70 percent of the population relies on boreholes, wells and other sources. Although successive administrations have invested billions of naira in water production in major water works, including Iju and Adiyan, as well as several other mini water works scattered across the state, supply of potable water has remained largely intermittent. More homes and offices are turning to boreholes and water vendors, as the LSWC lacks the capacity to make the required investment.
Shayo Holloway, a former managing director/CEO of LSWC, believed that private capital was critical to turn the situation around. According to Holloway, to meet the water demand, the LSWC had developed a master plan to construct additional large water schemes by 2020. Holloway said that the plan would involve taking raw water from rivers and lagoons for treatment into potable water.
“This plan will take the state from its current 210 million to 745 million gallons per day. The corporation will need $3.5 billion to execute the water master plan. This is an investment which the state cannot solely undertake.
“That is why partnership with the private sector to accelerate the development of water infrastructure is necessary. This will make water available,” said Holloway.
In 2013, the administration of Babatunde Fashola, embarked on the construction of Adiyan waterworks II as part of the implementation of the state’s water master plan, to add 70 million gallons to the existing 210 million gallons per day. The water project was said to have, however, suffered a setback after Fashola left government, as funding dried up during the administration of Akinwunmi Ambode.
As a way of overcoming the challenge of funding, the LSWC prior to 2016 was said to have proposed to the government appropriate pricing of water in the state due to rising costs of production and distribution. According to an official of the corporation, with the tariff little over five kobo per litre, an equivalent of N50 for five drums of 250 litres, charged by the LSWC, Lagos ranks among cities with the lowest water tariffs and this is a disincentive to any private investment. “This is certainly not sustainable,” said the official
The inevitability of the right pricing, according to the official, was premised against the rise in the population of Lagos and the need to supply drinkable water to homes as a way of protecting the residents against water borne diseases.
The official said although a minor review of the water tariffs was carried out in 2016, it still never translated to appropriate pricing given the huge investment required in that sector, hence there is still the need for the government to go into Public Private Partnership (PPP).
“There is no running away from the reality. Truth is that the current tariff is not sustainable. If we’re going to have stable water supply to homes in Lagos, the pricing must be right. I agree that the LSWC was not established for profit making but as a service organisation. But the point that must be stressed is that in rendering that service, the corporation should at least recover cost of production and treatment of water to keep the service running while the government can pay the staff salaries and allowances. What we have currently is a situation where the tariff paid by the customers of LSWC cannot meet production cost. This is not sustainable anywhere in the world.
“The laws should be amended to allow for full private sector involvement in a regulated manner. This is not privatisation as some groups would say, but private collaboration with the government to meet up the water need of the rising population of Lagos,” said the official.
Corroborating this view, Holloway said there was the need for public-private partnership to accelerate the development of water infrastructure with private capital.
“Such investments are recoverable over a negotiated concession period of 20 to 30 years, depending on the size of investment and financial model,” he said, stressing the need, however, to complete the Adiyan II as the starting point.
Interesting, the Babajide Sanwo-Olu is seen taking steps in this direction. Sanwo-Olu on Thursday, October 10, led members of the state’s executive council to the Adiyan water works project following the re-mobilisation of contractors back on site.
Sanwo-Olu said his administration was poised to complete the abandoned water project because of its strategic importance to the wellbeing of the people. According to him, the revival of the project would aid government’s effort at addressing the causes of poverty and fight diseases.
“When this water works project is fully completed, it will be the biggest of its type around Nigeria and we will be raising the capacity of our potable water supply by 330,000 cubic metric tons per day, which is more than 70 million gallons.
“The commitment from our side is for us to see how we are going to finish this project on time and as much as possible within the budget. The contractor has said they are committed to completing it in the next 18 months. Our government will work with the contractor and the project consultant to deliver this project on agreed time.
“If we achieve this within the next two years, we would be achieving one of the key items of Sustainable Development Goals (SDGs), which is also a strategic pillar of our development agenda in the area of provision of safe drinking water to over five million citizens of Lagos.”
Sanwo-Olu hoped that his administration would be able to award contract for the commencement of the second and third phases of the water project, which are reticulation works and construction of 8-kilometre water intake conduits from Akute to Adiyan.
According to him, some of the impediments encountered in the project, including compensations and right of way, would be addressed to allow the contractor finish the project on record time.
“We will award contracts for the second phase of this project, which is reticulation that will take the water to some parts of the state, including Ikeja, Alimosho, Surulere and Yaba.
“The third part of the project is construction of an intake mechanism, which is about 8 kilometres from Akute Water Intake site. Some parts of the construction work were suspended because of issues around the right of way with the residents and Ogun State. We are also going to finalise on that. We would pay all the compensation to ensure that they can lay the pipes.”
The Adiyan II water works is sited on 210 hectares of land in a borderline community between Lagos and Ogun states.
Piero Capitanio, managing director of Salini Nigeria Limited, the contractor handling the project, assured that the waterworks would be delivered in 18 months.
JOSHUA BASSEY
