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» 16.10.2009 - Gabon and Nigeria elected to UN Security Council

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Economy - Development | Politics

Nigeria suspends $8.3 billion railway project

afrol News, 30 October - Nigerian Federal Government has suspended US $8.3 billion Lagos-Kano rail project awarded to Chinese Civil Engineering Construction Corporation (CCECC) by former president Olusegun Obasanjo.

A senior Nigerian presidency official confirmed that contract awarded to CCECC in 2006 had been suspended to allow government to make a comprehensive review of the project.

The project has been widely critcised for its sluggish pace in rebuilding and rehabilitating Nigeria's single track rail line. The project has also been accused of inflating prices.

Fact finding committee leader Garba Lado at Nigeria Railway Corporation (NRC) offices said he was skeptical about commitment of CCECC to the project, but said he was not aware of suspension.

"There was no record before Senate indicating that contract was given due process. This is the first time committee is hearing about the suspension. I want to believe that it is because of the various accusations from different quarters that company is not serious about the job," he said.

Earlier, while addressing management staff of NRC, Mr Lado alleged that a group was behind inefficiency of rail system in the country, saying an effective rail system was vital to development of any nation.

"From our own assessment, I do not expect anything positive, because last time we came here, we met similar equipment. It is like nothing is done here. We want action and progress," he said.

He said House was concerned that first phase of the project spanning 1,315 kilometres from Lagos to Kano, estimated to cost US $2.5 billion in line with international per kilometre rate for railway modernisation project was awarded for $8.3 billion to CCECC.

While government had only paid a small fraction, of US$250 million of project's cost, Mr Chi Hong Bing, project representative, said his firm had made some progress on 1,315-kilometre Lagos-Kano double track standard gauge, which is the first phase of the 25-year-long modernisation project.

Nigeria has a network of 3,505 kilometres of narrow-gauge single track lines, covering nine of country's 36 states. Most of its 200 locomotives however, broke down long ago, reports stated.

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