To say that Nigeria is in dire need of help is to state the obvious. What with the high level of insecurity (terrorism, kidnappings and armed robbery), unemployment, revenue shortfalls, unmet budgetary expectations, dilapidated infrastructure, unfulfilled electoral promises, rising inflation, exchange and interest rates, massive factory closures, labour crisis and mounting debt servicing obligations, one cannot but wonder what the future would be for a nation that has been tagged the poverty capital of the world.
However, amidst these scary statistics, some federal government agencies have been working round the clock to change the current narrative especially as it concerns closing the gap in infrastructure. Among them is the Infrastructure Concession Regulatory Commission (ICRC).
This disclosure was made on Thursday 28th July, 2022, at a facility tour of the Lekki Deep sea port Lagos, by a team of Public-Private Partnership (PPP) advisers from federal government Ministries, Departments and Agencies and selected media practitioners including BusinessDay. The delegation was led by the Director-General/CEO, ICRC, Mike Joe Ohiani.
Started in 2020 as a multi-purpose vehicle and located at the Lagos Free Trade Zone, Lekki Port is reputed as one of the most modern ports in West Africa, offering enormous support to the burgeoning commercial operations across Nigeria and the entire sub- region. The port is one of the signature projects certified by the ICRC under the leadership of Ohiani, a legal practitioner turned project management guru
With a lease tenure of 45 years, the Lekki Port’s projected revenue is $361billion about N252.7 trillion (Two Hundred and Fifty Two trillion, Seven Hundred Billion Naira at the rate of N700 to a dollar) with potential of creating 169,972 new jobs. The port which is 95percent completed is billed for final completion this December while the official commissioning is slated for March 2023.
According to Lawrence Smith, the Chief Operating Officer, the port is estimated to cost the investors $1.53billion on fixed assets and $800m on construction and would when completed “have an estimated aggregate impact of $361bn over a period of 45 years as well as offer a multiplier effect of more than 230 times over the total cost of US$ 1.53 bn.”
Revenue to state and federal agencies from taxes, royalties and duties is estimated at $201bn respectively
The second is Badagry Deep sea port, Lagos, with a total development area of 692.6hc and a channel of 18m draft with a single access channel length of 8.9km from the fairway buoys. It was last week Wednesday approved by the Federal Executive Council (FEC) with a revenue target of $53bn and 250,000 new jobs
Like the Lekki port, the approval by FEC followed the issuance of Full Business Case Certificate (FBC) by ICRC to the grantor, the Federal Ministry of Transportation, through the Nigerian Ports Authority (NPA).
Estimated to be completed in 5 years, the Badagry port will comprise: General cargo terminals, Container terminals, RoRo & Grain terminals, Offshore supply basis (OSB), Liquid Bulk jetties as well as Barge and Rail terminal. It will be equipped with the capacity to handle 3.9 million Twelve Equivalent Units (TEUs), 24 million metric tons of cargoes and 1.4 million cars annually.
The port will also have a navy berthing facility as well as utilities such as road fly-overs, rail and public roads.
There is no doubt that these state-of-the-art multi-purpose facilities will offer customers superior uncongested hinterland connectivity in one of the deepest waters in West Africa, thus creating a sustainable competitive advantage for Nigeria going forward.
Beyond increasing government revenues, the deep sea ports will also facilitate foreign investment, reduce congestion within Lagos ports of Apapa and Tincan Island, improve cargo clearance and delivery process, reduce vessel waiting time and enhance competitiveness of the Nigerian economy by reducing transportation costs and freight rates as well as open Nigeria’s economy up to more local and international business transactions especially in the area of export of goods across the world. They would also serve as transportation hub in West Africa.
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“With the modern cranes (ship to shore cranes) and automation, there will be reduced waiting time for vessels coming to the port, quick turnaround of vessels thereby reducing cost for the shipping lines, quick availability of raw materials to manufacturing concerns, quick turnaround of capital for importers and short transit time for containers coming to Nigeria,” said Daniel Ndibe, Lekki Port project manager
Speaking with BusinessDay, Ohiani said as a regulatory commission, both Lekki and Badagry deep sea ports were some of the projects the commission reviewed and certificated and subsequently approved by the Federal executive council as special purpose vehicles with the Nigerian Ports Authority, the Federal Ministry of Transport and Lagos state government as key stakeholders
“We are optimistic that when completed and operational, the two ports will serve as veritable avenues for economic development by creating multiple jobs for our teeming youths, revenue for government in form of taxes and other levies and serve as a hub of economic activities especially for land locked coastal areas while the inter-modal transportation system would receive a boost”, he said.
According to the DG, the two ports will be linked to dry ports using barges and that the action would take tankers off the roads and expand the life span of the roads in addition to other benefits to the nation.
Until his recent confirmation of appointment, Ohiani was the Acting Director General of the ICRC, a position he filled following the sad demise of his predecessor, Chidi Izuwah in March 2021. As Acting DG, he also directly oversaw the PPP Resource Department where he was responsible for catalyzing Public and Private expertise and resources towards the structuring and development of Federal PPP Projects that are bankable and yield value-for-money for Nigerians.
Before joining ICRC, he was the Team Leader, Executive Unit at the Debt Management Office where he had various responsibilities including participation in bilateral negotiations and managing the projects for DFID support programmes.
ICRC was established in 2008 to regulate Public Private Partnership (PPP) endeavours of the Federal government aimed at addressing Nigeria’s physical infrastructure deficit which hampers economic development.
Despite daunting challenges which include funding, the commission has continued to record successes in the issuance of Outline Business Case (OBC) and Full Business Case (FBC) and compliance Certificates on some important projects and approved by the Federal Executive Council (FEC). According to the DG, the commission had so far issued a total number of 127 OBC and 50 FBC Compliance Certificates for some projects.
Some of these projects include: the Nigerian Air project, the Onitsha River Port, Lagos Ibadan Rail e-Ticketing Concession, the Warri-Itakpe standard Train service, Device Management System, Revenue Assurance Solution (RAS) and a floating Dock for NIMASA.
Plans are underway for the privatization of some federal medical hospitals and federal roads.
In addition, “The NNPC through the NNPC Medical Services Limited (NMSL) has commenced PPP projects to develop five multi-specialist hospitals in five locations which include; Maiduguri, Port Harcourt, Lagos, Kaduna and Abuja. It also proposes to establish an Intravenous Fluid Plant in Kano through PPP methodology.
“The Federal Ministry of Health through the Port Health Department has received an OBC compliance certificate for the decontamination and fumigation project for vessels arriving at all seaports in Nigeria.
“The Federal Ministry of Industry, Trade and Investment (FMITI) is going digital with an OBC compliance certificate for the Digital Industry Trade and Investment Platform.”, said Ohiani
Furthermore, he said the Federal Capital Territory (FCT) had received an OBC compliance certificate for a project to maximise revenue from water bills in the Territory through the introduction of state-of-the-art water meters while the Nigeria Police Force (NPF) had received OBC compliance certificates to redevelop dilapidated property and barracks across the country. This, the DG said, includes properties in Ikeja, Falomo and Ijeh in Lagos, as well as Guzape in Abuja.
An OBC compliance certificate was issued to the NPF to revive its almost comatose air wing facilities to deliver better services through PPP. Also the Federal Ministry of Health/UCH Ibadan received an OBC compliance certificate to renovate and upgrade the School of Nursing students’ hostel in the hospital.
BusinessDay gathered that there are currently 77 PPP projects at implementation (post-contract) stage and 194 projects at development and procurement (pre-contract) stages. Indeed, as at April 25, 2022, the commission had issued a total of 105 Outline Business Case Certificates (OBCs), 48 Full Business Case Certificates (FBCs) and secured 51 PPP approvals from the Federal Executive Council and would soon publish the 2022 Pipeline of Eligible PPP Projects in line with the ICRC Act.
It has equally thrown its weight behind the National Space Research and Development Agency (NASRDA) in its quest for effective satellite solutions in rural areas.
The space agency is currently carrying out research in the field of broadband technology that will result in cost effective satellite system solutions in rural Nigeria through a Public Private Partnership (PPP) arrangement.
The project was designed as part of the solutions towards meeting Nigeria’s aspiration of providing up to 90% of Nigerians with fast, affordable, reliable and high-speed broadband internet.
While the Warri-Itakpe train service is expected to generate N50,718,109,320, expected accruals from the Lagos – Ibadan service is put at N90,429,635,939 within the 10-year concession period.
Prior to it coming into effect, the Federal Government only generated about N189 million every month from the Abuja – Kaduna service, whereas the figure rose to N400 million after the concession came into effect.
ICRC is also working very assiduously to re-position Nigeria as the Public Private Partnership (PPP) knowledge base in Africa.
Indeed, since its establishment, ICRC has blazed the trail in establishing and institutionalizing the use of PPPs in Nigeria for our economic development and gone beyond the Federal level to now partner with states that require guidance and capacity on how to go about the PPP processes.
“ICRC facilitated a World Bank sponsored APMG’s certified PPP practitioners course for 60 Nigerian government staff at Federal and State levels in addition to building PPP capacity,” the DG said.
