Bureaucracy, insecurity threaten N1tn FEC contracts
Most
of the capital projects awarded by the Federal Executive Council this
year may fail to meet their completion deadlines despite President
Goodluck Jonathan’s wish for the contrary.
Investigations by SATURDAY PUNCH have shown that about four
months into the expected period of completion, many of the contracts
have yet to commence due to bureaucracy, non-release of funds and
insecurity in the country.
Going by SATURDAY PUNCH’s week-on-week computations, FEC has
awarded contracts amounting to N1tn from January to July 25. This
includes the N371bn contracts awarded on July 19 to complete some
projects under the ministries of transport, power and the FCT.
Visits to some of the project sites showed that implementation has
yet to commence. A study of the contract documents however showed that
many of them had implementation duration ranging between 90 days and 24
months.
Apart from the Ministry of the Niger Delta, which got a chunk of the
contracts, it was found that security, electricity, roads and education
also got significant attention in keeping with the Federal Government’s
N4.8trn budget for 2012.
The Senate had reportedly questioned the legality of contracts
awarded by the FEC last February, just as the Director-General, Budget
Office of the Federation, Dr. Bright Okogu, expressed concern about
abandoned projects, scarcity of funds, contract abuses by Ministries,
Departments and Agencies, three weeks ago.
Meanwhile, in a document released in Abuja last week, FEC has awarded a total of N927bn contracts in the past 10 months.
Research, however, showed the following in 2012: January contract
award was N27.23bn; February N16.62bn, April N74.47bn, and May N30.40bn.
SATURDAY PUNCH found that on March 14, FEC approved N8bn for
the construction of five additional power substations to address the
problem in the national power grid; a cardinal point in Jonathan’s
agenda.
After the FEC meeting that Wednesday, the Minister of Information,
Mr. Labaran Maku, said the projects would be located at Kwoi in Kaduna
State, Nnenwi in Enugu State, Egbe in Kogi, Ose in Ondo and Gagarawa in
Jigawa.
He said execution of the projects would improve the transmission
capacity, quality of electricity supply and service delivery nationwide.
But four months after, reports from two of the locations showed that
work has yet to commence with no indications that it may soon take off.
In Kogi State, it was found that construction work at the power
substation at Egbe, one of the five substations approved by FEC in
March, has yet to commence due to bureaucracy affecting the timely
release of funds.
Except for the clearing of the proposed site, there was no other
visible evidence that work was on course. But the state government had
provided the land and Certificate of Occupancy for the project site.
The Chief Press Secretary to the Kogi State Deputy Governor, Mr. Mike
Abu, corroborated this finding on the telephone when he said the state
government had provided land.
He said the commencement of the work may have been delayed due to bureaucracy and non- release of funds.
Still on the power substations contract, report from Ondo State was
not different as one of our correspondents reported that not so much may
be expected until December this year.
The Station Manager of the Independent Power Plant in Omotoso town in
Ondo State, Mr. Sam Iteskiri, told one of our correspondents on Tuesday
that the equipment needed to execute the project at the plant were
still being expected.
He, however, said that the plant had already delivered 80mw of
electricity with the completion of three units on load at the station
and hoped that the substation would deliver 300mw before the end of the
year.
He said, “We are seriously working to meet up with our target. We
will complete the entire plant on or before the end of December this
year when all the equipment we are expecting would have arrived and been
installed.”
On March 28, the FEC approved N27bn as 50 per cent subsidy for the supply of fertiliser to rural farmers in 2012.
The Minister of Agriculture, Dr. Akinwumi Adeshina, said same day
that a pilot scheme had already been done in 12 states with varying
degrees of success of not less than 60 per cent, depending on the mobile
phone networks in the areas, while a back-up of paper vouchers would be
used as supplement for the areas with inadequate telephone network for
the system operations.
Among the contracts approved by FEC on April 4 was N1.2bn contract
for the channelling of Asa River and its tributaries, which run through
Ilorin metropolis in Kwara.
The Minister of Environment, Hadiza Ibrahim-Mailafia, had said that
the contract was awarded to address the perennial problem of flooding in
Ilorin, to avert further destruction of lives and property.
Ibrahim-Mailafia said the contract would forestall a recurrence of
the 2007 and 2008 floods in the area, which displaced many schools,
mosques and churches, forcing the government to establish temporary
shelters for victims.
And even though the rainy season is here, and the project is expected to be completed within 12 months, SATURDAY PUNCH found that work has yet to commence there.
The dredging, recommended by the Department of Erosion, Flood and
Coastal Zones Management of the ministry, was awarded to Messrs Ambico
Sendirian Nigeria Ltd, but the funds to execute the contract would be
secured from the Ecological Fund, according to the minister.
Meanwhile, the dredging of the Asa River, Kwara State had not yet commenced, three months into the period of completion.
An investigation by one of our correspondents, who went round some
of the affected areas in Ilorin on Tuesday, confirmed that work has yet
to commence.
After the approval in April, the Chairman of the Senate Committee on
Ecology and Environment, Dr. Bukola Saraki, had hoped that work would
commence on the project in a short time.
An email message sent to Saraki through one of his Special Assistants
on Media, Bankimole Omisore, on Sunday, for clarification on why work
has yet to start, was not replied at the time of filing this report.
Calls made to his cell-phone indicated that he could not be reached.
Another media aide to Saraki, Mr. Akintoba Fatogun, did not pick his calls when one of our correspondents called.
The Asa River runs from the Oke Ogun side of Oyo State through Asa Local Government, Ilorin to the River Niger.
Another power-related contract approved by FEC on April 25 is a
N90.7bn award for strategic gas supply for power generation plants in
the country.
He was quoted as saying, “Inadequate gas supply has been one of the
reasons for recent downturn in power generation. The Ministry of
Petroleum Resources and the Ministry of Power have been working on this
for a while. Today, the petroleum resources ministry brought a memo to
council seeking the immediate construction of the strategic gas pipeline
from Obiaku/Obrikom in Rivers State to Oben in Edo State.”
Maku said Lot 1 of the contract was awarded to Nestoil Nigeria Ltd.
at the cost of N19.25bn with the addition of $19.20m component, while
Lot 2 was awarded to Oil Serve Nigeria Ltd. for the sum N29.52bn with an
$83.92m component.
He said FEC directed that the execution of the contract should be delivered in 24 months.
Same day, FEC ratified a contract of N2.9bn for the development of
the National College of Petroleum Studies in Kaduna, established to
train middle level officers and some key management staff in the
petroleum industry.
Meanwhile, report from one of our correspondents showed that
construction work had long started at all the units of the project
sites. This implied that the approvals are being done in phases.
On May 2, 2012, FEC approved N8.2bn for the construction of Inland
Waterway Port at Jamata near Lokoja, and dredging of a channel along the
Orashi River.
Maku said the amount was expected to finance the reclamation works along the River Niger.
A breakdown of the project showed that N4.1bn would be spent on the
construction of the Inland River Port, Jamata; N2bn would go into the
dredging of a channel along the Orashi River from Oguta Lake in Imo to
Degema in Rivers; N2.1bn for dredging and reclamation works at selected
sites along the River Niger, which would be carried out at Patani and
Aseomoku in Delta; Ilushi in Edo, as well as Okun and Kelebe in Kogi.
He said when completed, the project would make the (River) Niger
commercially viable and useful to the economy, while it would create 90
professional and non-professional job opportunities for Nigerians during
its execution.
On May 9, FEC awarded a N3.1bn contract to Messrs. Kobus
NavalDesign/Portplus Ltd., for the procurement of new Aluminium High
Speed Boats with back-up spare parts and training of crew members for
the Nigeria Customs Service marine operations. It was to be delivered
within nine months.
On the same day, it awarded a contract of N4.2bn for the
rehabilitation of Owerri-Umuahia Road sections I, II & III in
Imo/Abia states to Messrs. Zerock Construction Nigeria Ltd. It was to be
completed within 24 months.
It also awarded N1.3bn for the construction of two bridges along
Auchi Polytechnic Ekperi-Agenebode Road in Edo State to Messrs. Niger
Construction Ltd. and it was to be completed in 12 months.
Also, on May 30, FEC approved N2.71bn for the construction of
Nkporo-Abriba-Ohafia Road in Abia State to be executed by Messrs Dutum
Construction (Nigeria) Ltd. within 18 months; it awarded N2.21bn for the
rehabilitation of Ada Okere-Ukoni-Amedokhian Road in Edo State to
Messrs ARC Marine & Civil Contractors Ltd. It was to be completed in
14 months.
FEC also approved a N9.8bn contract for the establishment of
Information Communications Technology centres in educational
institutions across the country; under the portfolio of the Petroleum
Technology Development Fund.
Maku said the institutions to benefit from the project were picked
from a list given to the PTDF by the Federal Ministry of Education,
adding that it also approved N267m for consultancy services for the
development of a 25-year national ports master plan.
In June, FEC approved a number of contracts. Specifically, on June 3,
it awarded $11.41m contract for the major overhaul and restoration of
Plant Unit GT17 at Ughellli Power Plc to Messrs Sematech/MJB Ltd.,
payable at the prevailing exchange rate at the time of payment plus
N90.6m for customs duty, port charges, security, community issues and
logistics. The 90-day completion period will lapse in late August or
early September.
On June 27, FEC approved the purchase of six security boats to tackle piracy, oil theft in the nation’s waterways.
Maku said three of the boats designed for the security of vessels and
ships within ports’ jurisdiction would be operated by the Nigerian
Ports Authority in conjunction with the Nigerian Navy.
The contract for the three boats for the security of vessels and ships was awarded at the cost of $19.7m (about N2.9bn).
“The purchase of these boats will empower the Navy and the Nigerian
Ports Authority to guarantee safety of vessels that come into our
waterways, particularly in the Lagos area. The ministry also brought a
proposal to buy additional boats for inner waterway security.
“Looking at the memoranda that were submitted and the importance of
these boats to secure both the inner waterways and coastal areas, the
Federal Executive Council gave the go-ahead to the Ministry of Transport
to purchase the boats to reinforce our maritime security,” he said.
It awarded N8.3bn to reclaim Abam-Nnuju-Igbiri-Oba-Okujagu-Ama
waterfront in Okrika Local Government Area of Rivers State, areas
surrounded by the Atlantic Ocean had been threatened by erosion from
surrounding coastal water. The completion period was 24 months.
On June 19, FEC approved N371bn for contracts to implement projects
for the Ministry of Transport, Ministry of Power and the Federal Capital
Territory, including the implementation of the Lagos-Ibadan railway
modernisation project.
Maku could not be reached for comments. Calls placed to his
cell-phone were unanswered, while he didn’t reply text messages sent to
his device.
Similarly, Presidential spokesman, Dr. Reuben Abati, could not be
reached. Though Abati acknowledged receiving a text on the issue, he
said he was in a meeting.
