Eastern Rail lines to cost FG N9tr – Amaechi

…Alleges that non approval of $30bn loan by NASS stalls execution
Minister of Transportation, Chubuike Rotimi Amaechi, said it will cost Federal Government a sum of $12.8 billion, equivalent of about N9 trillion, to construct standard gauge of rail lines from Port Harcourt to Maiduguri.

He said this whopping is about the size of the entire budget for the country in a year.

The Minister made the revelation on Wednesday while appearing before the Senate Joint Committees on Land Transport, Local and Foreign Debts investigating the alleged abandonment of the Eastern rail lines in the rail revitalisation projects across the country.

Amaechi as well alleged that the refusal of the Senate and by extension, the National Assembly to approve the $30bn foreign loan requested for by the Federal Government is stalling the project.

The minister’s appearance was consequent upon the mandated last week by the Senate that the joint committees should summon him to clarify the alleged exclusion of Eastern rail line in the nationwide railway projects across the country, captured in the foreign loan obtained by President Muhammadu Buhari for that purpose.

The Senate took the decision following its consideration and adoption of a motion moved by the Deputy President of the Senate, Ike Ekweremadu, drawing the attention of the chamber to the perceived injustice to the Eastern flank of the rail project.

Amaechi reiterated Federal Government’s stand that there was no plan to exclude the region from the rail project and assured the committee that the area is already captured in the 2018 borrowing plans of the Federal Government, part of which was the $30bn foreign loan from China Exim Bank.

He added that though on their own part as executive, the required design for the project has been done but approval for both the design and costing are being delayed by bureaucratic bottleneck caused by the Public Procurement Act (PPA).

Amaechi said: “The Public Procurement Act is very tedious and takes a long time to conclude the process which must be followed because President Buhari had always insisted that the rule of law be followed to the letter.

“The President insists on rule of law and the law passed by the National Assembly in terms of public procurement is very tedious and not easy to conclude; it takes a very long time.

“Similarly, the law passed by the National Assembly on the Bureau for Public procurement is very tedious”.

The Minister also pointed out that railway project was very capital intensive, and that the Federal Government did not have sufficient fund to implement the railway projects across the country at the same time.

He explained that following the inadequacy of funds confronting the government, the All Progressives Congress (APC)-led administration had decided to adopt a systematic approach in the project execution, saying that it was as the loan was approved, then government would apply the fund and do what it could afford.

His words:” We have met with both GE and the consortium handling the project for nearly two years now and we are still on it even as the first firm as handed over to TRANSNET, meaning Transport Network.

“Let me make it clear, the country does not have the resources to do railway in every village. It is not possible. $2.7 billion is one trillion Naira.

“So, for the railway you want to do from Port Harcourt to Maiduguri is about $12 .8 billion which is about N9 trillion equivalent to one year budget of Nigeria.

“Therefore, everything is done systematically, we can’t do all the projects at the same time. What we are doing is as we get the loan approved, we execute the project. Currently, we are following due process for the one of South East.

“Currently we have placed an advertisement on the Eastern Rail lines. Sometime in 2017, we placed an advertisement for rail from Port Harcourt to Maiduguri and that is what the law expects us to do. We can’t skip the law on construction of standard gauge.

“Again, even the narrow gauge construction does not only concern the South East. The same narrow gauge transversed Port Harcourt to Maiduguri.

I don’t know what other thing the Senate expects from me on this project except to say that it is work in progress.

“We are not magicians and the current law we have insists on the number of times we shall advertise a project, we completed the project, we pass it to Bureau for Public Procurement, which in turn will be referred to us before we go to the cabinet for presentation and I think we are set to go to the cabinet for approval.”

On the insinuation that General Electric (GE) has pulled out of the project, Amaechi explained that the company handed over the contract to another sister company because it was no longer in the transport business.

“It (GE) handed over the job to another sister company in the consortium which is Trans-net. We are at the verge of signing the contract agreement and it is when we finished signing the consortium agreement that we will begin to look for money to execute the project.

The total cost of the project is $2.7 billion and it is a Private Partnership agreement,” he noted.

The Chairman of the Committee, Gbenga Ashafa, expressed satisfaction with the explanation given by Amaechi, urging the Minister to ensure that no section of the country was excluded from the rail project.