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INFRASTRUCTURE INVESTMENT OPPORTUNITIES

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1 INFRASTRUCTURE INVESTMENT OPPORTUNITIES
for THE NIGERIA CENTENARY CITY AND ROAD INFRASTRUCTURE BUSINESS IN NIGERIA Presented By: AMBASSADOR BASHIR YUGUDA Honourable Minister of State for Works At PARTNER III G20 AFRICA INFRASTRUCTURE INVESTMENT CONFERENCE, Millennium Hotel, Mayfair, London / House of Lords, LONDON July 18th 2013 17th – 19th July, 2013 FMW

2 Nigeria’s Economic Blueprint: The Vision 20:2020
Making the Nigerian economy one of the top 20 by the year 2020 with a GDP of USD900bn Attracting US$130billion private capital over the next 10 years Optimising key sources of economic growth by enhancing production for real sector’s competitiveness and for exports Guaranteeing productivity by strengthening linkages between key sectors of the economy Fostering sustainable social and economic development by ensuring national security and enhancing infrastructure. FMW

3 Nigeria’s Economic Performance Indicators
The External Reserve as at June 2013 stood at US$48.76 billion. The IMF projects a 7% growth in Nigeria’s growth for 2013 in its country report . External Debt Profile with ample fiscal space US$5.91 billion – 2013 Industrial Capacity Utilisation – Over 50% (1st Half 2013) Sources: CBN, DMO,NBS FMW

4 Global Real GDP Growth – 2011 & 2012
Nigeria has maintained an average growth of about 7% in the last three years BRICs High Income While World GDP continues to shrink, Nigeria is expected to sustain its growth at about 7% Source: World Economic Outlook 2012 FMW

5 World’s Fastest Growing Economies - 1
Source: National Bureau for Statistics (NBS) FMW

6 World’s Fastest Growing Economies - 2
Nigeria’s economy is rated as the world’s topmost ‘global growth generator’ (3G) of the next 40 years CIRA Citi Investment Research and Analysis FMW

7 Nigeria’s Economy: ‘too large to ignore’
8th largest population in the world – over 167 million people 4th largest population under the age of 20 10th world largest reserves of oil and gas 36.2 billion barrels of oil 184 trillion Cubic Feet of natural gas 4th largest equity market in the MSCI Frontier Market index Largest outside of the Gulf Cooperation Council (GCC) 5th fastest growing economy in 2010 covered by Citi Investment Research and Analysis (CIRA) economists – China, Taiwan, Singapore & Qatar 1st among the N-11 leading ‘global growth generators’ (3G) over the next 40 years Prospects of growing its global GDP share to 2.5% in 2050, overtaking Italy, France, and UK Home to emerging world’s largest cement companies - The DANGOTE GROUP FMW

8 THE NIGERIA CENTENARY CITY PROJECT
One of the endearing legacies of the Nigeria Centenary celebration shall be the development of a Centenary City in Abuja the Federal Capital from 2014. The City is conceived to be developed over 1000 hectares of land to focus the attention of the investing world to Nigeria in a way that has never been done before. The successes of such cities as Dubai, Monaco, Shenzhen, Singapore and lately Songdo have shown that development of certain class of cities is the strongest social, political and economic tool to securing Foreign investment, promoting positive international attention and indeed signalling a new economic awakening. The City promises to be one of the most outstanding legacies of the Centenary. FMW

9 THE ABUJA CENTENARY CITY
A GREEN CITY – with a natural buffer that envelopes the entire City and encircles the central neighbourhood that protects and nurtures the whole world-class public facilities; ZERO WASTE MANAGEMENT – The city will aim at reducing waste to zero. Domestic waste will be used to create nutrient-rich soil, fertilizer and incinerated as an additional power source. Other wastes such as plastics and metals will be recycled or re-proposed for the other uses; A CENTRAL PARK – that provides the green-spirit which gives orientation, clarity and iconic power to the City as a whole but most powerfully to the City Centre. FLEXIBLE TOPOGRAPHIES – that are all conceptually related to one another so that they can be placed together to create a rich, elegant, textured and vibrant City. AN URBAN GRID – super-block system that is modular and organic yielding a resulting grid of arteries, streets and pathways with and efficient traffic system where pedestrians, bicycles, motorcars, trams and monorail can co-exist in a friendly human way; FMW

10 THE ABUJA CENTENARY CITY
INDEPENDENT POWER SOURCE – With a gas-fired 500MW power plant connected directly to a gas terminal, constant power supply to the City can be taken for granted. WATER MANAGEMENT – Planned in an environmentally sound manner where approximately 60 percent of the water used will be recycled and waste water reused as many times as possible. PUBLIC AREAS – A prominent cultural core with various symbols of Nigeria’s Unity and Strength, Parks, Galleries etc. COMMERCIAL – Exquisite Office Tower, Exotic Hotel, Magnificent Shopping Malls, Imposing Expo/Convention Centre, Cosy Theatres and Cinemas; RESIDENTIAL – Elegant High-rise Apartment & Apartment Towers, Single Family Houses, Semi Detached Houses, Row Houses, Apartment Blocks; CIVIC – Primary & Secondary Schools, University Campus, Health Centres, Health Farms and Theme Parks; FMW

11 THE ABUJA CENTENARY CITY
INSTITUTE OF SPORTS – Sports shall be given prominence in the City with the top-of-the range sporting facilities, which shall include a signature golf course. SPORTS HOSPITAL – A modern sports hospital that will be on the cutting edge of sports medicine and providing 5-star level services The Sports Hospital will offer state-of-the-art diagnostic tools and services. BUSINESS CENTRE – A preferred destination for multi-national and domestic businesses. It is expected that the top most corporate bodies in Nigeria will have their show rooms in the City. PRESIDENTIAL ARCHIVES – To house the history of our political development and the contributions of our Presidents and the Nigerian Institute of Federalism. A NEW CEREMONIAL ARCADE (UNITY SQUARE) – To compliment the Eagle Square to add colour to the Government ceremonies and activities. FMW

12 THE ABUJA CENTENARY CITY
NEW ABUJA CITY GATE – A magnificent and awe-inspiring architectural masterpiece that will eloquently introduce the Centenary City and welcome visitors to Abuja. With a five year development period,the City is planned for a residential population of about 100,000 people but to host about 500,000 visitors daily. It shall promote world- class multinational and domestic businesses in a world-class and master planned environment that gives meaning to Life, energy for Work and pleasure and greatness into the next centenary. FMW

13 THE ABUJA CENTENARY CITY
Features that have been contributed to the success of other cities of this nature include: Trade Free Zone • Duty Free Regime • Tax Holiday • Chartered Status • Offshore Status • Outstanding Infrastructure and secured business environment • Expanded and efficient transport services especially Air Services • Secured Environment etc. FMW

14 SECTION 2 A PRESENTATION ON THE INVESTMENT OPPORTUNITIES IN THE NIGERIA ROAD SECTOR FMW

15 INTRODUCTION The total road network in Nigeria is estimated at about 200,000km and owned & managed as follows: Federal Government - 17% (Over 34,000Km) States % and Local Governments - 67% of the road network respectively. In Nigeria, the road sector accounts more than 80% of of all freight and passenger movements, thus underscoring their crucial importance to the economy of the country. The Federal roads have been subjected to severe pressure as a result of increased vehicular traffic as well as freight especially given the near absence of rail, marine and other forms of transport to convey heavy goods. FMW

16 INTRODUCTION contd. Funding road infrastructure projects remains a major constraint in the delivery of efficient and improved road networks across the country. On an average, the annual funding requirement is estimated at N500b (US$3.125b) against an average budgetary allocation of N120bn (US$0.75b) with a deficit of N380bn. (US$3.375b) The deficit is evident to have negative consequences on the development of road infrastructure undermining national economic growth. Huge capital resources are needed for sustainability of this huge network which cannot be met by Government hence need for Private Sector involvement via PPP and concessionary loans. FMW

17 ROAD OWNERSHIP STRUCTURE IN NIGERIA
FMW

18 NIGERIA INTEGRATED TRANSPORT NETWORK
FMW

19 ROAD INFRASTRUCTURE BUSINESS OPPORTUNITIES IN NIGERIA
The Federal Ministry of Works has developed Outline Business Cases (OBC) for viable and bankable major highways (brown fields) in the nation to attract private sector participation and direct foreign investments into the sector. For other Greenfield road projects, opportunity also exists like proposed “Strategic Highway Investment for Transformation (SHIFT)” The appropriate framework for Public Private Partnerships (PPP) in Nigeria is already in place - Establishment of the Infrastructure Concession Regulatory Commission (ICRC) and development of National Policy on PPP. FMW

20 INVESTMENT OPPORTUNITIES BY PUBLIC PRIVATE PARTNERSHIP(PPP) INITIATIVES
NO. NAME OF ROAD 1 Kaduna – Kano Dual Carriageway 2 Abuja – Kaduna Dual Carriageway 3 Shagamu – Benin Dual Carriageway 4 Benin – Asaba Dual Carriageway 5 Lagos – Badagry Seme Border Dual Carriageway 6 Upgrading and Modernization of Enugu – Port Harcourt Road 7 Completion of Ibadan – Ilorin Road 8 Lagos – Iseyin – Kishi – Kaiama Road 9 Kaiama –Babana- Bobe – Kaoje – Kwamba- Fokku –Sokoto Road (new alignment) 10 Onitsha – Enugu Dual Carriageway 11 River Katsina ala Bridge at Buruku 12 River Niger Bridge at Nupeko FMW

21 NIGERIA ROAD NETWORK FMW

22 ON-GOING PPP HIGHWAY PROJECTS: PPP PROJECTS UNDER PROCUREMENT:
INVESTMENT OPPORTUNITIES BY PUBLIC PRIVATE PARTNERSHIP(PPP) INITIATIVES S/NO ROADS/BRIDGES DISTANCE REMARKS ON-GOING PPP HIGHWAY PROJECTS: 1 Reconstruction & Expansion of Lagos – Ibadan Expressway 126Km Newly Awarded on EPC basis. O & M Concession - to be awarded. 2 Guto – Bagana Bridge across Benue River 1.35km Bridge & 65Km Road Concession is being reviewed & will be awarded.. PPP PROJECTS UNDER PROCUREMENT: Construction of 2nd Niger bridge at Asaba/Onitsha 2Km Newly Awarded Access Road to Murtala Mohammed International Airport (MMIA) Road, Ikeja, Lagos 2.8Km Award of Concession in progress 3 Construction of bridge over River Niger at Nupeko, Niger State 950m OBC development phase in progress. FMW

23 PROPOSED PPP HIGHWAY PROJECTS WITH OBC BEING DEVELOPED:
INVESTMENT OPPORTUNITIES BY PUBLIC PRIVATE PARTNERSHIP(PPP) INITIATIVES S/NO ROADS/BRIDGES DISTANCE REMARKS PROPOSED PPP HIGHWAY PROJECTS WITH OBC BEING DEVELOPED: 1 Enugu – Port Harcourt Dual Carriageway 210Km OBC development in progress. 2 Lagos – Iseyin – Kishi – Kaiama Road 414Km 3 Kiama – Bahama – Kaoje – Gwambu – Fokku – Sokoto Road 631Km 4 Construction of bridge over River Benue at Buruku, Benue State 1Km 5 Construction of bridge over River Benue at Ibi along Shendam - Wukari Road. 880m FMW

24 HIGHLIGHTS ON THE INVESTMENT OPPORTUNITIES BY PUBLIC PRIVATE PARTNERSHIP(PPP) INITIATIVES: ENUGU – PORTHARCOURT DUAL CARRIAGEWAY The Enugu-Port Harcourt Road is located within the South East and South South Zone of Nigeria. The road lies between Longitude 07° 00’E and 08° 00’E and Latitude 04° 30’N and 06° 30’N The Road alignment is part of Route A3 which traverses the South South through the North Central to the North Eastern part of Nigeria. The section of the road under consideration is 210km long and links the oil rich Niger Delta and sea port in Port Harcourt to the Northern part of the country via the South Eastern States of Nigeria. FMW

25 Studies/Reports to embark on the PPP project has been commissioned.
HIGHLIGHTS ON THE INVESTMENT OPPORTUNITIES BY PUBLIC PRIVATE PARTNERSHIP(PPP) INITIATIVES: ENUGU – PORTHARCOURT DUAL CARRIAGEWAY The existing asphalt dual carriageway is 7.3m wide with 2.75m surface dressed outer shoulders and 1.5m inner shoulder on either side. The pavement structure is made up of laterite sub-base, crushed stone base and asphaltic concrete wearing course. There are about 2 bridges along the road alignment with several culverts and other hydraulic structures. The road has a recorded Average Daily Traffic (ADT) of 9,000 vehicles per day in 2011. The ADT is projected to reach 9,540 vehicles per day in the year The condition of the road can be described as poor. Studies/Reports to embark on the PPP project has been commissioned. Feasibility and Viability studies have been completed and Outline Business Case (OBC) substantially completed. FMW

26 MAP OF NIGERIA SHOWING LOCATIONS OF PIPELINE PPP PROJECTS
KADU NA-KANO DUAL CARRIAGEWAY ABUJA-KADUNA DUAL CARRIAGEWAY BRIDGE OVER RIVER BENUE AT IBI RIVER NIGER BRIDGE AT NUPEKO RIVER KATSINA ALA BRIDGE AT BURUKU MURTALA MOHAMMED INT‘L AIRPORT ROAD 2ND NIGER BRIDGE AT ONITSHA/ASABA LAGOS-BADAGRY- SEME BORDER ROAD ENUGU-PORTHARCOURT ROAD FMW 41

27 INVESTMENT OPPORTUNITIES OF PIPELINE PPP PROJECTS
S/NO ROADS/BRIDGES DISTANCE REMARKS PROPOSED PPP HIGHWAY PROJECTS WITH FEASIBILITY/VIABILITY STUDIES YET TO COMMENCE 1 Bodo-Bonny Road to Link Bodo to the Island of Bonny in Rivers state 39 Km OBC studies to be carried out 2 Dualization of Ilorin-Jebba-Mokwa-Kaduna Road 597 km OBC ready 3 Dualization of Keffi-Akwanga-Lafia-Makurdi Road 215 km 4 Dualization of Lokoja-Ajaokuta-Ogbulafo- Enugu (9th Mile) Road 238 Km 5 Dualization of Akwanga-Jos Road 145 Km 6 Dualization of Enugu ( 9th Mile ) – Otukpo – Makurdi Road 261 Km OBC studies to be carried out. 7 Dualization of Owerri – Aba Road 60 Km 8 Phase I : 2nd Lagos outer ring Road: Tin Can Island – Igando – Lagos/Otta road interchange – Lagos/Ibadan expressway 74 Km OBC is ready 9 Phase II : 2nd Lagos outer ring Road Lekki-Epe Expressway Linking Existing Lekki-Epe Expressway with connection to the Proposed Lekki Deep Sea Port ii) 5th Mainland Bridge. 25 Km Road: 20.3Km Bridge: 5.4Km Consultant to carry out Feasibility Studies 10 Golden Triangle (Economic) Highways Various (5000Km) Consultants will be appointed to carry out Feasibility Studies to determine mode of best actualization FMW

28 INVESTMENT OPPORTUNITIES OF PIPELINE PPP PROJECTS
NO NAME OF ROAD 1 Lagos – Iseyin – Kishi – Kaiama Road 2 Bodo – Bonny Road 3 Phase II : 2nd Lagos outer ring Road: Lekki-Epe Expressway linking Existing Lekki-Epe Expressway with connection to the Proposed Lekki Deep Sea Port 5th Mainland Bridge 4 Golden Triangle Super Highway KANO FUNTUA ZARIA BIRNIN GWARI KAD SAMINAKA JOS MINNA MOKWA BIDA ABUJA ILORIN LAFIA OGBOMOSHO OSHOGBO LOKOJA MAKURDI IBADAN OTUKPA ORE LEGEND LAGOS-KISHI-KAIMA ROAD PROPOSED GOLDEN (ECONOMIC) TRIANGLE SUPER-HIGHWAY (4 ABOVE) LAGOS BENIN ENUGU BODO/BONNY ROAD ONITSHA OKIGWE WARRI 2ND LAGOS OUTER RING ROAD UMUAHIA OTHEF HIGHWAYS: 1,2 & 3 ABOVE WARRI OWERRI ABA YENAGOA PORTHARCOURT FMW

29 ● The Road is divided into Two Sections:
HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: LAGOS-ISEYIN-KISHI-KAIAMA-BAHANA-BODE-KAOJE-GWANBE-FOKKU-SOKOTO ROAD ● The Lagos – Iseyin – Kishi – Kaiama – Bahana – Bode – Kaoje – Gwanbe – Fokku – Sokoto Road is located within the South West, North Central and North West Zone of Nigeria. ● The road lies between Longitude 02° 00’E and 05° 30’E and Latitude 06° 00’N and 13° 30’N. ● The Road is divided into Two Sections: Section I: Badagry-Iseyin-Kishi-Kaiama (414.4km); Section II: Kaiama-Babana-Kaoje-Gwambu-Fokku-Jega-Sokoto (631km) ● The road under consideration links Lagos the economic nerve centre of Nigeria to North Central and North West parts of the country. FMW

30 The alignment has many sub-standard bridges and hydraulic structures.
HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: SECTION I: Badagry-Iseyin-Kishi-Kaiama km The existing carriageway varies from 6m to 7.3m wide with shoulders of an average width of 1.5m. The pavement structure is made up of laterite sub-base, laterite base and asphaltic concrete wearing course on some sections while other sections are earth roads. The alignment has many sub-standard bridges and hydraulic structures. The road has a recorded Average Daily Traffic (ADT) of 9, vehicles per day in 2011. The ADT is projected to reach 9, vehicles per day in the year The condition of the road can be described as poor. Feasibility and Viability studies have been completed including the Outline Business Case (OBC) FMW

31 HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: SECTION II: Kaiama-Babana-Kaoje-Gwambu-Fokku- Jega-Sokoto Badagry-Iseyin-Kishi-Kaiama - 631km The existing carriageway comprises of sections with asphaltic concrete pavement and surface dressed pavements. The width varies from 6m to 7.3m with shoulders of an average width of 1.5m. The pavement structure is made up of lateritic sub-base & base and asphaltic concrete wearing course on some sections while other sections are surface dressed. The alignment consists of 16No. Bridges with many culverts and other hydraulic structures. The road has recorded Average Daily Traffic (ADT) of 5, vehicles per day in 2011. The ADT is projected to reach 5, vehicles per day in the year This is attributed to the poor condition of the road . Feasibility and Viability studies have been completed including the Outline Business Case (OBC). FMW

32 Bodo – Bonny Road has a length of 39km.
HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: BODO-BONNY ROAD IN RIVERS STATE DESCRIPTION OF THE ROAD: Bodo – Bonny Road has a length of 39km. The road lies between Longitude 07° 30’E and 07° 00’E and Latitude 05° 00’N and 04° 30’N The road links Bodo on the mainland to the industrial Island of Bonny that houses the Liquefied Natural Gas (LNG) factory in Rivers State. It traverses a typical Niger Delta terrain of mangrove swamps and creeks. FMW

33 HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: BODO-BONNY ROAD IN RIVERS STATE: ROUTE CHARACTERISTICS The route traverses through thick forests, swamps and creeks. It is a virgin route with no history of any development. The Project area traverses numerous creeks and rivers, which empty into the Atlantic Ocean. Over 60% of the roadway traverses swampy terrain which is inundated by the daily tidal flow around the area. Contract for construction of the Road had earlier been awarded, but due to paucity of funds, only 20% achievement. FMW

34 HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: RIVER NIGER BRIDGE AT NUPEKO
The Bridge is located in the North Central Zone of Nigeria in Niger State. The Bridge lies between longitude 05° 30’E and 06° 00’E and latitude 08° 30’N and 09° 00’N. The Bridge under consideration is 950m long and links Niger and Kwara States in Nigeria. FMW

35 Studies/Reports to embark on the PPP project has been commissioned.
HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: RIVER NIGER BRIDGE AT NUPEKO There is no existing bridge at the current location. Movement of goods and services within the project area are by ferry services. The new bridge is to be constructed as a single carriageway with two lanes and pedestrian walkways. The road has a low Average Daily Traffic (ADT) due to the absence of a bridge at Nupeko to link Niger and Kwara States. Studies/Reports to embark on the PPP project has been commissioned. Feasibility and Viability studies have been completed including the Outline Business Case (OBC). The project has been advertised for concessioning. FMW

36 HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: RIVER KATSINA ALA BRIDGE AT BURUKU
The Bridge is located in the North Central Zone of Nigeria in Benue State The Bridge lies between Longitude 09° 00’E and 09° 30’E and Latitude 07° 00’N and 07° 30’N The Bridge under consideration is 880m long and would link Gboko and Zaki -Biam communities in Benue State. FMW

37 Studies/Reports to embark on the PPP project has been commissioned.
HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: RIVER KATSINA ALA BRIDGE AT BURUKU There is no existing bridge at the current location. Movement of goods and services within the project area are by ferry services. The new bridge is to be constructed as a single carriageway with two lanes and pedestrian walkways. The road has a low Average Daily Traffic (ADT) due to the absence of a bridge at Buruku. Studies/Reports to embark on the PPP project has been commissioned. Feasibility and Viability studies completed with the OBC substantially completed. FMW

38 HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: RIVER BENUE BRIDGE AT IBI
The Bridge is located in the North Central Zone of Nigeria in Benue State The Bridge lies between longitude 09° 30’E and 10° 00’E and latitude 08° 00’N and 08° 30’N The Bridge under consideration is 880m long and links Gboko and Zaki Biam comunities in Benue State. FMW

39 HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES:RIVER BENUE BRIDGE AT IBI
There is no existing bridge at the current location. Movement of goods and services within the project area are by ferry services. The new bridge is to be constructed as a single carriageway with two lanes and pedestrian walkways. The road has a low Average Daily Traffic (ADT) due to the absence of a bridge at Ibi town. Studies/Reports to embark on the PPP project has been commissioned. Feasibility and Viability studies completed and OBC substantially completed. FMW

40 HIGHLIGHTS ON THE MAJOR HIGHWAYS INVESTMENT OPPORTUNITIES: 2ND NIGER BRIDGE AT ONITSHA/ASABA IN ANAMBRA & DELTA STATES The Bridge is located in the North Central and South Eastern Zone of Nigeria ●The Bridge lies between longitude 06° 30’E and 07° 00’E and latitude 06° 00’N and 06° 30’N The Bridge under consideration is 2km long and links Onitsha in Anambra State to Asaba in Delta State. FMW

41 HIGHLIGHTS ON THE MAJOR GREENFIELD HIGHWAYS INVESTMENT OPPORTUNITIES: 2ND LAGOS OUTER RING ROAD
FMW

42 HIGHLIGHTS ON THE MAJOR GREENFIELD HIGHWAYS INVESTMENT OPPORTUNITIES: 2ND LAGOS OUTER RING ROAD
CURRENT SITUATION: The Lekki Free Zone (LFZ) has main access with the Lekki - Epe Expressway which joins the coastal road towards the South and has only one entrance facing the Atlantic. Traffic bottleneck exists along Lekki Peninsula/Victoria/Lagos Mainland link road. Most part of LFZ is not directly accessible from the Lekki-Epe Expressway going towards the North. The planned Deep Sea Port & Airport will attract huge traffic/transportation volume that will worsen the already congested Lekki-Epe Expressway. FMW

43 HIGHLIGHTS ON THE MAJOR GREENFIELD HIGHWAYS INVESTMENT OPPORTUNITIES: 2ND LAGOS OUTER RING ROAD
PROPOSED SOLUTION: Construct a 25Km 4-lane link road from the Lekki-Epe Expressway to the LFZ. Construct a 5th Mainland Bridge consisting of 5.4Km Bridge over Lagoon, 200m Bridge over the Creek and 20.3Km rad length (adoption of 2-lane dual carriageway. Completion of the eastern loop with a 2-lane dual carriageway to link Shagamu – Benin Expressway. FMW

44 FUTURE PLANS OF THE MINISTRY
BRIDGING THE ROAD INFRASTRUCTURE GAP:- The Federal Ministry of Works has developed a new plan for Green field projects – The Strategic Highway Investment for Transformation (SHIFT) Programme: The Golden Triangle Super – Highway – Conceived to improve the nations economy and to be driven by the private sector. Federal Government to provide the Right of Way (ROW) and offer guarantees in form of Viability Gap Funding (VGF). Paradigm Shift Shift in Institutional Structures Shift in Mechanism for financing roads Shift from Public to Private Sector Management FMW

45 GOLDEN (ECONOMIC) TRIANGLE SUPER-HIGHWAY
KANO FUNTUA ZARIA BIRNIN GWARI KAD SAMINAKA JOS MINNA MOKWA BIDA ABUJA ILORIN LAFIA OGBOMOSHO OSHOGBO LOKOJA MAKURDI IBADAN OTUKPA ORE ENUGU LAGOS BENIN ONITSHA LEGEND OKIGWE WARRI PROPOSED GOLDEN (ECONOMIC) TRIANGLE SUPER-HIGHWAY UMUAHIA WARRI OWERRI ABA YENAGOA SUPER-HIGHWAY LINKS TO MAJOR CITIES PORTHARCOURT FMW

46 SHIFT PROGRAMME (WHAT WE ARE CURRENTLY DOING)
S/NO ACTION FINANCE REMARKS 1 Completion of On-going projects at advanced stages of completion FG SURE-P On-going 2 Routine and Periodic Maintenance of Federal Roads FG 5% FUEL SURCHARGE 3 Rehabilitation of Federal Roads FG/SGs/Multi-lateral Agencies (AfDB; World Bank) 4 Upgrading of Major Federal Trunk Roads Public Private Partnership (PPP) Feasibility studies On-going 5 Greenfield Projects (Golden Triangle Super-Highway) Detailed Route identification On-going. Consultant to carry out feasibility/viability studies to be appointed. 6 Lagos Outer Ring Road 7 Institutional Reforms FMW, BPE, World Bank & DFID Process On-going FMW

47 KEY FEATURES OF THE GOLDEN (ECONOMIC) TRIANGLE SUPER-HIGHWAY
4 to 6 lanes entirely new super-highway Connects key hubs of economic activity in the country Within 1hr of 30 cities and state capitals Crosses or within reach of 20 states of the Federation It will add approximately 5,000km to the national network of roads in Nigeria It will ensure the provision of world-class services on public highway facilities as well as attract Real Estate development along the ROW Attraction of Direct Foreign Investment and Private Sector finances with return on investment through tolling (PPP’s) New economies will be created along corridor (e.g. tourism in the coastal alignment) Precedence: High growth economies: China, India, Brazil, Malaysia etc. FMW

48 SECTION 3 REGULATORY FRAMEWORK FOR PPPs in Nigeria FMW

49 Nigerian Legal and Regulatory Framework for PPPs
FMW

50 A World Class Integrated Road Network is Our National Aspiration
FMW

51 Key PPP Legislation - The ICRC Act 2005
Establishes the Infrastructure Concession Regulatory Commission (ICRC) Sec. 14.1 MDAs may enter into a contract with or grant concession to any duly pre-qualified private sector proponent for the financing, construction, operation, and maintenance of any infrastructure that is financially viable or any development facility of the Federal Government. (Section 1.1). Empowers the ICRC to; Provide general policy guidelines, rules and regulations. Take custody of every concession agreement entered by the Federal Government Ensure efficient execution of any concession agreement or contract entered by the Federal Government. Section 11 (Arbitrary Variation etc) No agreement reached in respect of this Act shall be arbitrarily suspended, stopped, cancelled or changed except in accordance with the provisions of this Act. FMW

52 NATIONAL POLICY ON PUBLIC PRIVATE PARTNERSHIPS
Government Commitment Policy Objectives Economic Social Environmental Enabling institutional environment Guidelines for the PPP Coordination and planning Capacity building Effective communication Roles and responsibilities Market development Collaboration with states and other stakeholders Further guidance on Nigerian PPP Manual on ICRC website (www.icrc.gov.ng) FMW

53 PPPs Definition in Nigerian Context
A Public-Private Partnership is a contractual agreement between a public agency (federal, state or local) and a private sector entity. Through this agreement, the skills and assets of each sector (public and private) are shared in delivering a service or facility for the use of the general public. In addition to the sharing of resources, each party shares in the risks and rewards potential in the delivery of the service and/or facility. Wide Infrastructure Gap Growing demand for private sector participation in infrastructure Small and depleting Government resources Urgent need for alternative funding of Infrastructure The goal is to combine the best capabilities of the public and private sectors for mutual benefit FMW 53

54 Why Will PPPs Deliver Better Value for Money for Nigeria?
PPPs let Public Sector and Business do what they do Best! Private Innovation, use of technology Professional management Good project and lifecycle management Efficiency Technology Maintenance practices Financing Public Policy setting National planning Regulation Looking after public interest

55 PPP LIFECYCLE in line with National Policy
Development Phase NEEDS ANALYSIS PPP OPTIONS APPRAISAL VALUE FOR MONEY AFFORDABILITY SUSTAINABILITY PRELIM RISK MATRIX VIABILITY/BANKABILITY VGF OBC OBC APPROVAL BY FEC PREPARING AND IMPLEMENTING EFFICIENT AND EFFECTIVE PPP TRANSACTIONS PPP LIFECYCLE in line with National Policy Procurement Phase TRANSACTION ADVISER EoI/RFQ Phase AND RFP BIDDING BIDDERS CONFERENCE BID EVALUATION VALUE FOR MONEY TEST PREFERRED BIDDER FULL BUSINESS CASE BY FEC Implementation Phase TECHNICAL ADVISER MONITOR DESIGN AND CONSTRUCTION COMMISSIONING TEST VERIFY OUTPUT REQUIREMENTS CONTRACT MANAGEMENT Project Identification Project Prioritization Project Selection Preliminaries FMW

56 Our PPPs in Nigeria are about:
1. Mobilising private sector’s money, expertise and capacities for national infrastructure development 2. Long- term relationship between the government and private sector (usually>10years) 3. Sharing of Risks and Rewards (no lop-sided agreements-privatizing the profits, nationalizing the loses) 4. Private sector performs to agreed KPIs 5. Life cycle focus (operations and maintenance) Government is moving from role of Developer & Operator to Facilitator (and Governing) Facilitator Developer& Operator FMW

57 WE FOCUS ON BANKABLE PPP PROJECTS TO MARKET
IRR > Weighted Average Cost of Capital RoE > Shareholders Requirement Debt Service Cover Ratio > Bankers or Lenders Requirements Loan Life Cover Ratio > Bankers or Lenders Requirements Focus is not just about comparative but competitive advantage !! Viability Gap Funding and Capital Grants Sovereign Wealth Fund – Infrastructure Enabler Investments Ideas don’t get funded bankable projects get funded. We are taking to market projects with robust cashflows and cost reflective returns We are providing an environment where investors will invest, to provide services, recoup their investments without exploiting the masses – HE GEJ FMW

58 Construction Contractor
Typical BOT Structure BOT-Toll Road Project GRANTING AGENCY FINANCIERS Equity Investors Lenders, Guarantors Insurers CONSTRUCTION CONTRACTOR DESIGN CONSULTANT Finance Ris Risk Demand, Traffic, SPV ROAD USERS Design Consultant Construction Contractor O&M Contractor Concession Agreement Design Risk Construction Risk Tolls The final responsibility for service delivery continues to remain with the public sector FINANCIERS Equity Investors, Lenders, Guarantors, Insurers Service The salient features of any PPP arrangement are as follows: Contractual arrangement: Bring the public and private sector together to create better value for money for the taxpayers through the use of the management skills and financial strength of the private sector, and conducive legislative and policy measures of the public sector. Substantial risk transfer to the private sector: Engage the private sector through a transparent process and oversee the PPP according to accepted performance norms. Financial rewards based on performance: The government pays the private sector for the services it renders; these services are based on actual performance as against the targets. Operational Risks Traffic/Revenue & O&M FMW

59 THE KEY PPP PRINCIPLES BEING DRIVEN BY NIGERIA
Value for Money Ensure project appraisals take into account not only cost but also risks and service quality Public interest Adequate and prior consultation with end-users and other stakeholders of an infrastructure project as standard. Output requirements Concept of “verifiable service standards” to be used as basis for output or performance based specifications. Transparency Very high world class standards of public and corporate governance to enhance credibility and transparency. Risk allocation Risks allocated to the party best able to manage them. Competition Ensure business activities are subject to competition and appropriate commercial pressures, dismantling unnecessary barriers to entry, and implementing and enforcing adequate competition. Capacity to deliver Ensure authorities responsible for privately operated infrastructure have the capacity to manage the commercial processes involved and to partner on equal basis with their private sector counterparts. FMW

60 ROAD INFRASTRUCTURE COMPENDIUM
For more Information, you can Download for free the: “Road Infrastructure & Related Development in Nigeria – An Investor’s Manual” @: FMW

61 CONCLUSION The Government of Nigeria, is attracted by the benefits of mobilizing private capital to the road sector, with a view to filling the funding gap . Harvesting private capital helps to speed up the delivery of the public infrastructure & ensure adequate planned maintenance. The Federal Government of Nigeria is open to interested foreign investors who desire to tap into the opportunities within the road infrastructure sector of the economy. The sector promises tremendous rewards for investors who have the financial capacity, technical wherewithal and the institutional framework to do business with the Government of Nigeria. Therefore, investment in the development of road infrastructure in Nigeria, presents a lot of opportunities due to the current economic reforms of President Dr. Goodkuck Ebele Jonathan, GCFR under the Transformation Agenda of the country, with good returns on investments . FMW

62 THANK YOU FOR YOUR ATTENTION!
FMW


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