By David Agba, Abuja
Facts emerged yesterday on how the immediate past administration of Goodluck Jonathan stalled the N167 billion rehabilitation work on the dilapidated Lagos-Ibadan Expressway.
This, according to investigation, it did, by ignoring the arbitration offered by Bi-Courtney Highway Services Limited, the firm handling the project.
Coupled with the many controversies surrounding the project, the ongoing litigation on the matter, has further worsened the project’s funding, putting road users at greater risk of auto crash.
Minister of Works, Power and Housing, Babatunde Raji Fashola, SAN, recently lamented the crisis between the federal government and the company/companies handling the project, saying the development was capable of scaring away foreign investors.
Investigations however revealed that Bi-Courteny, the firm handling the project, had moved for arbitration for possible resolutions of the logjam that might be surrounding the speedy execution of work on the road.
In a letter dated January 25, 2013, signed on behalf of the company by Chief T.K. Akinbami, and addressed to the immediate past Minister of Works, Arc. Mike Oneolememen, the company pleaded for quick resolution of the alleged breaches.
The firm named a three-man team as its arbitrators, while government failed to make available its own representatives, three years after.
The letter reads:
“We refer to the letter dated 19th November 2012 wherein the concession granted to our Consortium vide your letter of 8th May 2009, was purportedly terminated pursuant to Article 16.1 of the Concession Agreement (“Agreement”) for failure to remedy the alleged breaches complained of in your letter dated 28th August, 2012.
“Please note that the Consortium disputes the purported termination of the concession. We refer to our letter dated 26th September 2012 (copy attached) wherein we responded seriatin to the issues raised in your letter dated 28th August 2012 and demonstrated clearly that the Ministry’s purported notice of the non compliance with the Agreement is premature and incurably invalid.
We also emphasized the need for the Grantor to comply with the Agreement before it alleges non-compliance by another party.
“Notwithstanding the above position, as committed patriots to the development of Nigeria, we continued with the project and recommended palliative works of 5th August 2012. Subsequently, we engaged a major construction company to commence actual reconstruction works on 23rd September 2012 and the company was active on site, until our receipt of the letter purportedly terminating the Concession.
“We firmly believe that a dispute has arisen which should have been resolved in accordance with dispute resolution mechanism provided under Article 21 of the Agreement prior to the invocation of any termination clause. In the circumstance, we demand that the Dispute Resolution Board (“the board”) be set up forthwith, to determine the propriety or otherwise of your action under the Agreement. We hereby appoint the under listed persons as our nominees to the Board.
1. The Hon. Mr. Justice G.A. Oguntade, Retired Justice of the Supreme Court of Nigeria
2. Prince Adesupo Adetona; Retired senior partner of Deloitte
3. Engineer B.G Giwa; former Acting Director Federal Highways
“Kindly appoint your nominees to the Board within 14 days of your receipt of this letter. as you are well aware, this should have been done earlier in the transaction.
“For the avoidance of doubt we reiterate that your purported termination of the Concession is, according to law, invalid and should be discountenanced by all relevant parties.”
And quite recently, Mr. Fashola, the power, works and housing minister lamented the challenge facing the project completion .
He said: “The Lagos-Ibadan Expressway is a story of what investors don’t like. The FGN granted a concession to a private company (Company A) and later withdrew and cancelled it. The FGN then entered into a construction and financing agreement with another company (Company B). Company A went to court and got an order to cancel the financing agreement made with Company B.
As things stand, work has been stopped on the construction of the road. The construction companies cannot get financing because of the court order, so they have laid off about 2,000 workers, in an economy that has so much to do and needs to create work.”
“These 2 (two) companies are Nigerian companies investing in Nigeria, which is a positive sign because the local investors are the most important to any economy.
“Regrettably, while not going into the merits and demerits of the FGN’s cancellation of Company A’s “concession”, it sends a not welcoming message to foreign investors if the decision was without basis or influenced by politics, which I cannot comment upon.
“If that was the case, as a foreign investor I will be asking myself the kind of treatment that awaits me as a foreigner if the Government does that to a citizen. But that is only one half of the story.”
