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FG approves Over $1.9bn Railway, Power Contracts

Determined to improve rail transport and electricity supply in the country, the Federal Government on Wednesday awarded strategic contracts in these two sectors.

The contracts approved during the Wednesday Federal Executive Council meeting were worth over $1.9 billion for the augmentation of railway modernisation projects (Phase 1; Lagos-Kano) and the supply and installation of parts for the 2 x 140MW Units 411G3 Generators at Shiroro Hydroelectric Plc.

The approval of the railway contract followed a memo brought by Minister of transport, Alhaji Idris Umar seeking FEC’s approval for the implementation of addendum No.2 (2nd Segment; Lagos to Ibadan Standard gauge Rail Double Track with Double formation) to the Main Contract for the Nigerian Railway Modernisation (Phase1; Lagos-Kano).

According to the memo made available to State House Correspondents during the weekly FEC briefing, “Messrs CCECC (Nig) Ltd commenced work on the project when it was awarded in 2006 but could not complete it due to funds constraints. A presidential committee was constituted with the mandate of re-negotiating and re-phasing the contract between FGN and Messrs CCECC (Nig) Ltd.

“After considering the recommendation of the committee council approved the implementation of Addendum No. 2 (2nd segment: Lagos-Ibadan0 to the main contract for the railway modernisation project (Phase 1; Lagos-Kano) for the Ministry of Transport in favour of Messrs China Civil Engineering Construction Company Nig Ltd in the sum of USD 1,487,782,196.00 payable at the prevailing exchange rate at the time of payment inclusive of all taxes with a completion period of 36 months”, Umar stated while briefing State House Correspondents alongside Information Minister and the Lands and Housing, Trade and Investment, Power and Petroleum Resources counterparts.

He hinted that FEC also approved the variation of the scope of work for the contract for design and construction of Abuja Rail Mass Transit Project (Lots 1&3) from the initial work span of 60.67km to 45.245km (Lots 1A &3), “thereby revising the contract sum from $841,645,898.00 to $823,540,545.87 payable at the prevailing exchange rate, at the time of payment inclusive of 5% VAT and 5% variation on prices.

“The contract is in favour of Messrs China Civil Engineering and Construction Corporation (CCECC), with a completion period of 36months” the minister said.

Power Minister, Rrof. Bath Naji latter announced that FEC also approved contract for the supply and installation of parts for the 2 x 140MW Units 411G3 Generators at Shiroro Hydroelectric Plc.

He said, “Council, in line with accepted best practsie in the operation and maintenance of hydropower plants approved the supply and installation of parts for the 2 x 140MW Units 411G3 Generators at Shiroro Hydroelectric Plc, in favour of Messrs AsNDRITZ Hydro GmbH, in the sum of €2,075,754.00.

“This is in addition to the naira sum of N13,326340.68 to be retained by Shiroro Hydroelectric Plc to cover 1% CISS fees and 2% Port and Handling charges, with a completion period of eight months”.

He further disclosed that another memo he brought got council’s approval for the restoration of 4.No Plant units and balance of plant at Omotosho Power Plc in favour of China Machinery and Engineering Corporation in the sum of USD 10,092,771.15.

This, the minister said, is payable at the prevailing exchange rate at the time of payment, plus N78,753,893.30 for 5% VAT with a completion period of 6 months.

Also, Minister of Trade and Investment, Dr. Olusegun Aganga hinted that Nigeria has improved in the FDI attaraction index to 23rd position making it a first quarter country for FDI attractiveness.

According to Aganga, “Nigeria is ranked 1st in the top five host economies for FDI in Africa at $8.91 billion in 2011 in comparision to $6.09billion in 2010, followed by South Africa with $5.9 billion in 2011 and Ghana with $3.2 billion.

“Nigeria accounted for over one-sixth of flows into Africa as a whole. Only Nigeria, South Africa and Ghana attracted FDI inflows above $3 billion in 2011”, he added.

AmarSim Associations Development Consultants

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