Lagos-Calabar Rail: Government to expend N3.93 trillion on contract

— 1st July 2016

Federal Government has signed an agreement with China Civil Engineering Construction Company(CCECC) to expend a total sum of $11.117 billion (about N3.93 trillion for the construction of Lagos-Calabar railway line. Minister of Transportation, Rt Hon Rotimi Chibuike Amaechi, who signed on behalf of the federal government revealed that the first segment of the rail line comprising Calabar, Uyo, Aba, and Port-Harcourt will be ready within two years.
Speaking during the ceremony, the Minister further noted that the contract signifies the Federal Government’s resolve to pursue aggressive diversification plan for the economy, adding that the coastal rail project when completed will link with all sea ports, together with the main Western line to create new business hubs for commercial activities.
He equally stated that through negotiations, the Federal Government was able to bring the price of the contract downwards by $800 million, meaning that the contract initially valued at $11.917 billion, now costs $11.117 billion.
While attributing the reduction in contract cost to the drop in prices of key materials such as steel among others, he noted however that contact for the job was initially to be awarded by the President Goodluck Jonathan administration.
His words: “We are today signing contract for the awarding of the Lagos Calabar rail line at the cost of $11.117 billion. Initially, that project was to be awarded by the Goodluck Jonathan administration at the cost of $11.917 billion, so we have been able to secure a price reduction of $800 million due to negotiations and the fall in price of some commodities in the world market.
“It is basically the same contract but at different price. The first segment, Calabar and Port-Harcourt by my expectation will be ready in two years and they are to be linked with all the sea ports,” he said.
Reacting, President of CCECC,Cao Bao Gang, who flew in from China for the signing ceremony, said that signing of the Lagos Calabar rail line will further enhance Nigeria’s economy in addition to boosting cheap transportation of commuters and cargo at all times.
According to Gang; “The Chinese company will build factories in Nigeria where it can fabricate materials necessary for servicing the rails. We will train Nigerians to acquire key skills in maintenance and other aspects of engineering.
“We pledge the commitment of the Chinese government to the successful transformation on the nation’s economy. CCECC will work hard to keep to the two years completion period for the first segment of the job,” he assured. - THE SUN