New concessionaire for Lagos - Ibadan seeks funds

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New concessionaire for Lagos - Ibadan seeks funds

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Motorway Assets Limited has been selected as the new concessionaire for the Lagos - Ibadan Expressway upgrade PPP project in Nigeria.

The previous concessionaire was Bi-Courtney Highway Services, which was the first company to win a concession agreement for the reconstruction and modernization of Nigeria's busiest highway under a design, build, operate and transfer (DBOT) agreement. 

Bi-Courtney Highway Services is part of Bi-Courtney Group, a company that was in 2003 awarded the concession by the Federal Government of Nigeria to design, build and operate the Murtala Muhammed Airport, Lagos Domestic Terminal and ancillary facilities on a land area of 20,000m2.

The new concessionaire for the Lagos - Ibadan road is currently seeking approximately N150 billion (US$744 million) to complete the road project. According to sources, the company is in the final stages of negotiation with lenders for a loan between N120 billion (US$595 million) and N150 billion (US$744 million), which would correspond to the second tranche of funds to finalize the project.

The Nigerian government provided fund for the project during 2013 and 2014. To be more specific the government provided a total of N50 billion (US$248 billion) for the project, N25 billion (US$124 billion) per year.

According to a person close to the project, the total investment is expected to be increased due to the fact that the road will have to be redesigned to accommodate new features. According to him, the previous design did not take into account specific local factors and it was not complete.

According to local sources, Nigeria's PPP Unit, the Infrastructure Concession Regulatory Commission has still to give the concession certificate to Motorway Assets Limited for the project, which may difficult the signing of the necessary for the project.

The Lagos-Ibadan Expressway is a 127.6 km expressway connecting Ibadan, the capital of Oyo State and Lagos State, the commercial center of Nigeria. It is also the major route to the northern, southern and eastern parts of Nigeria.

This expressway is the busiest inter-state route in Nigeria and handles more than 250,000 Passenger car unit (PCUs) daily and constitutes one of the largest road networks in Africa.

We have recently reported on several road PPP projects globally:

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