We’ve Not Been Notified Of Contract Cancellation — Bi-Courtney


Highway Services has said it has not been formally notified of the decision of
the Federal Government to cancel its concession agreement to reconstruct the
Lagos-Ibadan Expressway. Reacting to Monday’s termination of
the agreement, the company said, “We have not been formally informed about the
cancellation of the concession agreement and the process that led to it.”

It said in a public announcement, “We
would like to thank all parties to this transaction, all shareholders and other
stakeholders for their belief in the Nigerian spirit, which propelled them to
participate and invest heavily in this epoch-making project. We also want to
thank all Nigerians who have been with us on this fascinating, yet tortuous,

“We have no doubt that the issues
would be resolved in a manner that would rekindle the Nigerian spirit of
enterprise, scholarship, courage, and persistence.”
However, a Presidency source justified
the cancellation of the agreement, but some stakeholders are raising some
fundamental posers for the Federal Government.
Some of the notable conditions
breached by Bi-Courtney, according to the Presidency source, were its failure
to submit copies of the construction contract and failure to submit copies of
the financial agreement as provided in the agreement.
The concessionaire was also accused of
“failing to submit copies of the Operations and Maintenance contract as stated
in the agreement; failure to carry out construction work despite access to the
site since September 2009; and abandonment of the reconstruction and
rehabilitation of the site, among others.”
While announcing the termination of
the concession agreement on Monday, the Minister of Works, Mr. Mike Onolememen,
said the action was taken because the Bi-Courtney consortium had consistently
flouted the rules of engagement by failing to execute the Build, Own, Operate
and Transfer project as stipulated in the agreement.
He also announced that the Federal
Government had appointed two construction firms, Julius Berger Plc and RCC Nigeria
Limited, to handle the reconstruction of the 125-kilometre road.
While Julius Berger is to handle the
section from Lagos to the Shagamu interchange, RCC will handle the section from
the interchange to Ibadan.
However, sources familiar with how
Public-Private Partnership infrastructure projects operate faulted the
government’s action and warned of severe consequences.
One of the sources told our
correspondent in Lagos on Tuesday that the Federal Government did not fulfil
its obligations to the concessionaire, noting that these could have aided the
performance of the firm.
The source, who pleaded anonymity
because of the sensitive nature of the project, said the Federal Government
failed to secure the Right of Way for the concessionaire and also failed in
putting in place State Support Agreement for the states that the road passed
through to work with Bi-Courtney.
It will be recalled that the Lagos,
Ogun and Oyo State governments have opposed the granting of the concession to
the firm.
Another source said, “The Federal
Government has no power to award such a huge procurement contract without
following the Public Procurement Act.
“There was no competitive bidding by
interested companies for the project contrary to the provisions of the Act; no
contract sum was announced; it did not even pass through the Federal Executive
Council. Where are the contractors’ designs? Are they going to follow that done
by Bi-Courtney? If yes, are they going to pay off the concessionaire? These are
some of the questions begging for answer.”
When contacted, the Special Adviser to
the President on Media and Publicity, Dr. Reuben Abati, did not pick calls put
through to his telephone line, nor responded to text messages sent by our
However, the Head, Communications Unit,
Infrastructure Concession Regulatory Commission, Mr. Olugbenga Odugbesan, said
the agency had nothing to do with the project again since the Federal
Government had revoked the concession agreement.
“It is no longer under our regulatory
purview because ours is a Public-Private Partnership agency. The project does
not belong to us,” he said.
Our correspondent gathered at the
Ministry of Works in Abuja that the contracts given to Julius Berger and RCC
were not the usual ones, and would not follow the ministry’s normal budgeting
Instead, the source explained the road
was being treated as a “Presidential Intervention Project,” and that only the
Presidency could give its value.


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