The Minister of Works, David Umahi, has said the Lagos-Calabar coastal highway will cost N4 billion per kilometre and not the N8 billion per km reportedly claimed by former Vice President and Presidential candidate of the Peoples Democracy Party in the 2023 election, Atiku Abubakar.
The minister also dismissed claims that the project didn’t follow the due procurement process, stating that the contract was awarded on a counter-funding basis and not on a Public-Private Partnership as widely claimed.
Umahi disclosed this information when he appeared as a guest on the Television Continental News Hour programme on Wednesday in Lagos.
He noted that the project will cost N2.8 trillion when completed.
Recall that last week, Atiku Abubakar questioned President Bola Tinubu’s administration’s decision to allegedly award the contract to Gilbert Chagoury’s Hitech without competitive bidding, daring the president to disclose the full cost of the Lagos-Calabar highway project.
He also wondered why the Tinubu administration released N1.06 trillion for the pilot phase, or six per cent of the project, which begins at Eko Atlantic and is expected to terminate at the Lekki Deep Sea Port.
But in a statement on Tuesday, Umahi explained that despite the soaring costs of materials in the construction industry due to commodity price inflation and supply chain disruptions, the ministry is committed to prudence, promising to reveal the true cost.
In a more detailed response, Umahi confirmed that the project would be completed within eight years, stating that using the concrete pavement on the four-lane carriageway costs N4 billion per km.
He also explained that although N1.06 trillion was appropriated, the full amount had not been disbursed.
The minister explained, “People are building castles without knowledge, and they don’t know figures; I will run them for you. We will compare the cross-section of the one the former vice president mentioned that was renegotiated for $11.1 billion for 700 km.
“So you have to now ask what was there to be constructed. What was there to be constructed was the only available design from NDDC. They designed the entire 700 km, but we are not following exactly that pattern or right of way. We have a different modification. The original design had two carriageways on each side of the road with four lanes.
“And so when you run the figures, you now find out that under his calculation, it gives you over N19bn per kilometre. Now, dividing it by the 23 kilometres they are doing is about 2.225 times a standard superhighway carriageway, which is N11.55 billion.
“Whereas what we are doing, if you divide it, you get N5.167 billion, So when you now divide using our 1.067, you get about N4 billion/km. If you return to what he has quoted, you will get over N8bn.
“So, using concrete, which should be more expensive because of our terrain, and using flexible pavement, which shouldn’t stand the coastal route, you will find out that our cost is N4 billion instead of the N8bn claimed by the former vice president.”
On the mode of the construction process, the former Ebonyi governor explained that the administration never envisaged the project under a Private Public Partnership arrangement but under an Engineering, Procurement, Construction and Finance programme currently used on the Abuja-Makurdi road project.
He said, “This administration never envisaged the project under Private Public Partnership. It has always been under engineering, procurement, construction and finance.
“And so, under this kind of arrangement, as you have on the Abuja to Makurdi road project, the federal government must pay a certain amount for counterpart funding.”
“In this particular project of Abuja to Makurdi, which China Harbour is handling, the government is paying 50 per cent counterpart funding.
“Then you have also from Makurdi to 9th Mile in Enugu State, where we are also paying 50 per cent counterpart funding. So, there’s a marked difference between PPP and EPC plus F.
“In this project, there will be a negotiated counterpart funding of between 15 and 30 per cent”, he said.
