24 April
Commercial close
Concession agreement between parties was signed
Transport
Lagos
Implementation
Federal Airports Authority of Nigeria
15-11-2018 15:22:50
The Federal Government of Nigeria desires to promote investment and private sector participation in the development and operation of its private utilities and infrastructures. This is a PPP project for the design, engineering, procurement, construction, operation, and transfer of a new domestic terminal at the Murtala Mohammed Airport, Ikeja, Lagos, Nigeria.
The project assets consist of modern facilities, such as self-service check-in kiosks, automated access gates, passenger and baggage reconciliation system, and multi-storey car park (MSCP). The MSCP can conveniently accommodate 800 cars at any point in time. The terminal also serves to house top-of-the-range restaurants and retail outlets.
The terminal has the capacity to facilitate four million passengers per year. The GAT can handle 12 flights at once (or 1,500 passengers per hour), and 2.8 million domestic passengers are expected to travel through the terminal yearly.
A build, operate, and transfer model was selected to meet the increase in demand of air passengers and aircraft movement. PPP intervention in the country’s aviation sector will fill its huge infrastructural gap. The model will also make it possible for local investors to inject funds into the sector, thereby creating more jobs and reducing the burden and size of the public service. It is also noteworthy that any facility under PPP would be more efficiently managed and cost the government little or nothing.
Relevant stakeholder engagement sessions were carried out among key stakeholders, including the regulatory bodies, FAAN, workers' unions, and passenger airlines.
Information will be published as soon as it is available.
24 April
Concession agreement between parties was signed
7 May
Project commissioned by the then president of the Federal Republic of Nigeria
23 April
Initial agreement was for 12 years , however operator obtained ministerial approval for extension to 36 years which is being contested by FAAN
Redacted PPP agreement
40% Equity, 60% Debt
A Limited Liability company owning majority of the shares , and other private investors: The Shareholding Structure are as follows: 1. SPECTRA LIMITED = 9,000,000 MILLION SHARES 2. CHIEF T.K AKINBAMI = 500,000 SHARES 3. DR. OLAWALE BABALAKIN = 500,000 SHARES
Initial agreement was for 12 years , however operator obtained ministerial approval for extension to 36 years which is being contested by FAAN
| Type of risk | Description | Allocation | Mitigation |
|---|---|---|---|
| Pre-construction risk | Risk of not obtaining all the relevant approvals | Private Sector | Effective stakeholder engagement with relevant authorities to obtain approvals |
| Construction / Completion | Risk of not completing work prior to Milestone dates | Private Sector | Regular review of project Implementation Schedule |
| Cost risk | Private Sector | Effective budgeting, Cost management and financial controls | |
| Financial risk | Risk of not being able to provide the performance bond | Private Sector | Financial planning and control |
| Risk related to change in law, taxes, scope, technical standards, regulatory framework | Public Sector | ||
| Operating risk | Risk of operational inefficiencies | Private Sector | Effective operations management planning |
| Events of Default | Brief description | Termination Payments | Documents |
|---|---|---|---|
| Event | Failure of authority to perform its obligation as set as out in the agreement | ||
| Event | Any representation and warranty made by the authority as stated in relevant articles that has proven to be materially incorrect |
| Events of Default | Brief description of events of default | Termination Payments | Documents |
|---|---|---|---|
| Event | The concessionaire abandons or is deemed to abandon the construction of the terminal as provided by the relevant articles | ||
| Event | The concessionaire fails to pay the concession fee as required in relevant articles | ||
| Event | The concessionaire goes into liquidation or becomes insolvent under the law |
Initial agreement was for 12 years , however operator obtained ministerial approval for extension to 36 years which is being contested by FAAN
The Infrastructure Concession Regulatory Commission ( ICRC ) said on Monday that it will deploy everything within its ability to ensure the concession dispute between the Federal Airports Authority of Nigeria ( FAAN ) and Bi-Courtney Aviation Services is resolved. The Commission, which is saddled with the responsibility of monitoring and ensuring the efficient execution of all A Public-Private Partnership (PPP) projects entered into by MDAs on behalf of the Federal Government said it has continued to engage Hadi Sirika, the Minister of State on Aviation since his assumption of office on these challenges and believe they will be resolved soon enough in order to strengthen the relationship between the parties. Recall that the MMA2 and the Hotel and Conference Centre concessions awarded to Bi-Courtney Aviation Services Limited as a PPP project for the design, engineering, procurement, construction, completion, commissioning, operations and transfer has been experiencing several challenges. The terminal which took off in 2007 was given out in concession by FAAN, as representative of the federal government on Build, Operate and Transfer (BOT) basis, but while BASL insists that the concession agreement was for 36 years and that the General Aviation Terminal (GAT) belongs to the company in cognizance of the agreement, FAAN insists that it did not endorse 36 years for the concession but 12 years and that GAT was not part of the agreement. Speaking during a visit by the commission to MMA2, yesterday, Chidi Izuwah, acting Director General ICRC said he was aware of the challenges between the both parties adding that “We want to listen to both parties as an independent regulator, we want to physically access the situation and challenges on ground in order to Bette appreciate the positions by FAAN and Bi-Courtney and thereafter suggest possible line of action in resolving these issues. “We are interested in having an update from the parties on the performance of the related projects; we want to understand the challenges facing the operators, as well as the grantor of the contracts and the various steps taken towards resolving these challenges; we want to hear from the parties their requests to the government in ensuring the projects are efficiently implemented for the overall benefits to the government.” Also speaking during the visit, Wale Babalakin, Chairman , Bi-Courtney Aviation Services said if Nigeria intends to encourage private sector participation in the infrastructural development of the country it must abide by international regulations; government and its agencies must respect and abide by concession agreements.
