he Federal Government on Monday terminated the concession contract of the Lagos-Ibadan Expressway granted to Bi-Courtney on May 8, 2009.
The termination followed Bi-Courtney’s failure to carry out the contract six months to the expiration date. The government also said the company failed to get the necessary financial muscle to execute the job as provided for in the agreement.
Mike Onolememen, Minister of Works, who disclosed this to State House correspondents, said that government could not fold its hands and watch “the senseless carnage on this important expressway which is part of arterial route A1”. He added that “the Federal Government has also decided to embark on the emergency reconstruction of the expressway”.
The minister disclosed that the Federal Government has engaged the services of Julius Berger Plc and R.C.C Nigeria Limited to commence work immediately on the reconstruction of the expressway.
“While Julius Berger would handle section 1 from Lagos to Shagamu interchange, RCC Nigeria Limited will be responsible for section II from Shagamu to Ibadan”, he said.
“The Federal Government wishes to assure that while it will continue to uphold the sanctity of contracts entered into by the Federal Government, it will not shy away from implementing provisions of the contract agreement dealing with non-performance on the part of the contracting party”, the minister said.
Speaking on the implication of terminating the contract, he said “the legal implications of this termination have been carefully considered by both the Federal Ministry of Works and indeed the Federal Government. If you recall we have been on this issue for quiet sometime now and we have meticulously followed the concession agreement, the provision of relevant clauses of the agreement.
“We have complied fully with the provisions of this agreement. We have had cause even in the past to write the concessionaire to detail the breaches which he had committed in this agreement in this particular transaction and we have also followed the minimum and maximum number of days the contractor was expected to remedy the situation but failing which the Federal Government had no alternative but to take this course of action”.
On the percentage payment made so far, he stated that “this is a concessioned project. In other words, it is different from the normal EPC contracts, so the Federal Government in a sense did not make any direct payment to Bi-Courtney in this particular transaction”.
He added that “Bi-Courtney was supposed to raise the fund from the private sector and apply it to the construction of this expressway and toll it for as many as twenty five years to recoup its investment and this has not happened, and that is why today the concession has been terminated.
For your information under this concession the construction period is supposed to last for four years and the four years will come to a close in about six months time and right now there is nothing on ground to suggest that the company is capable”
Source: Businessday
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