The Federal Government and China Civil Engineering Construction Company (CCECC) have signed an agreement to commence work on Lagos to Calabar coastal rail project.
The project, which was initially awarded during former President Goodluck Jonathan’s administration at the rate of $11.917 billion, has been renegotiated to $11.117 billion following the drop in prices of some commodities.
The Nigerian government will take care of 15 per cent of the counterpart funding of the entire project that is expected to be completed in two years.
Speaking in Abuja during the signing of the MoU, the Minister of Transportation, Rotimi Amaechi, said: “This contract was awarded by the President Goodluck Jonathan regime at $11.917 billion and when we took over as the Ministry of Transportation, we negotiated with CCECC and succeeded in reducing the contract sum from $11.917 billion to $11.117 billion.
“We are able to save $800 million after negotiation with CCECC and that has to do with the fact that CCECC said prices of commodities like steel and other things have come down and there was need to bring down the prices of those things.
“So, our gathering is to sign same contract but with different price and to make it legal from the initial price to the negotiated price”, he said.
The minister also disclosed that the first segment of the project will commence as soon as discussion is finalised with China Exim Bank.
He said: “The first segment of the project, which is Calabar, Uyo, Abba and Port Harcourt and which would include all the seaports on the route will commence after discussion with China Exim Bank.
“Meanwhile, the entire contract covers Calabar, Uyo, Aba, Port Harcourt, Yenagoa, Otuoke, Ughelli, Warri, Sapele, Benin, Agbor, Asaba, Onitsha, Ore, Ijebu Ode, Sagamu and Lagos, and we believe that it will head to the Lagos Seaport to ensure that all the tracks terminate at the seaports we currently have in Nigeria”.
On when the project will be ready, Amaechi said: “My expectation is that the project can be completed in two years since funding won’t be a problem. We will conclude Lagos to Ibadan in two years and conclude Calabar to Port Harcourt in two years too.
“The project signed is in the budget and we are at the point of execution. We have signed the formal contract with CCECC and once we get the blessing from China Exim Bank, we will commence construction and we are paying 15 per cent of the contract as counterpart funding”.
Commenting on the Abuja- Kaduna railway project, the minister said the government will purchase more coaches in order to accommodate passenger.
He said: “The testrun has commenced but we have to hear from the president to know when the official ceremony will take place. We are not collecting money yet because we said we will collect money from the day the President flags it off.
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