Project proposal received
Project Proposal Received by Nigerian Shippers' Council
Nigerian Shippers' Council
The productivity and efficiency of the nation's ports industry have remained at the lowest ebb in the past two decades. This poor performance, inefficiencies, and high costs of the ports are attributable to long years of neglect of port infrastructure and superstructures and other associated infrastructure, like the ICD & CFS. Among other bureaucratic bottlenecks, these have remained the bane of Nigeria's economic development. The Onitsha ICD will facilitate better processing and handling of containerized cargo in the eastern axis of the Nigerian ports. Importers and exporters from the eastern axis will clear goods or cargo in the Onitsha ICD rather than the western ports in Lagos. This option provides cheaper logistics costs for cargo destined for the eastern axis hinterlands than when such cargo is processed and transported from Lagos. Another key rationale for the proposed Onitsha ICD is the growing level of commercial and economic activities in the eastern axis of Nigerian ports, which are results of significant infrastructural developments and urban renewal programs.
The Onitsha ICD shall have a modular design, and the facility will have an annual capacity of 5,000 TEUs. This facility can be expanded with increasing throughput. It is envisaged that the capacity shall not exceed 20,000 TEUs in the future, especially because of the proximity of the site to the proposed Aba ICD and Onitsha River Port. The proposed ICD facility shall be comprised of a container stacking area, office complex for ICD administration and Customs employees, container freight station with an adjacent stuffing and stripping area that will also serve as a customs inspection zone, loading/unloading area for trucks carrying LCL-cargo, equipment parking area dedicated to maintenance and repair activities, and container interchange including a truck parking area outside the ICD boundary.
The Onitsha ICD will provide the following services: 1. Cargo handling and processing capacity for 5,000 TEUs per year, with modular capacity to grow to 20,000 TEUs subject to demand. 2. Integrating surface transportation of containers in the South East. 3. Cargo consolidation point and customs clearance for cargo originating or destined for the Southeast zone. 4. Provision of a comprehensive cargo sorting center. 5. Provision of a temporary cargo storage facility. 6. Cargo and truck management through installation of appropriate equipment and machinery to receive and dispatch containerized cargo to and from the ICD for onward shipping.
As set out in the National PPP Policy, government MDAs are encouraged to identify where a PPP is likely to offer better value for money over other forms of direct public procurement. The BOOT model is considered most suitable for the concession of the Onitsha ICD in Anambra State for the following reasons: • It is in tandem with existing policy and the legislative framework, which approved concessions as a model for private sector involvement in the nation's port sector. • As the landlord, NSC retains the ultimate ownership of the land on which the ICD will be located, but transfers all the financial and operational risks to the concessionaire. • The option will ensure that NSC continues to act as the technical regulator while the concessionaire assumes the responsibility for development of the ICD and it operations. • The private sector is more likely to deliver the project within the prescribed timeline than would the public sector, and the efficiency and organization of the private sector in operating the facility would benefit the project more than if it was operated by the public sector. • In recommending the BOOT option, the need to source for private sector financing for the infrastructure development, operation, and maintenance was considered important, likewise the need to allow the private investor to recoup its investment over time before the infrastructure is handed back to the NSC. Under this proposed arrangement, the concessionaire will agree to undertake the following: • Develop the proposed ICD facility and its ancillaries. • Assume substantial financial, technical, and operational risks. • Receive financial returns through payments from operating the facility and other identified and approved sources of revenue over the life of the concession agreement. • Return the infrastructure to the NSC's ownership at the end of the contract. The BOOT concession as proposed is for a period of 25 years, after which responsibility for maintenance and operation shall revert to the government. The concessionaire is expected to recoup its investment, operating, and financing costs and its profit over this period. The BOOT option is guaranteed to introduce private sector efficiencies.
A stakeholder engagement meeting on the was held on the March 23, 2017. The meeting brought together key stakeholders. A project delivery team has been constituted to ensure that the expectations of the stakeholders are meet. An Evolving Corporate Social Responsibility plan has been put in place, which includes consultation with the host community and local government and ensuring the provision of the identified projects/amenities.
Outline Business Case Compliance Certificate
Project Proposal Received by Nigerian Shippers' Council
Project Proposal Screened by Infrastructure Concession Regulatory Commission
Approval of the Transaction Adviser Halcrow Infrastructure Consortium for the Onitsha ICD
Project Feasibility Study Approved
OBC Compliance Certificate issued by Infrastructure Concession Regulatory Commission