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2021 budget: FG to prioritise Lagos-Ibadan, Abuja-Kaduna-Kano roads, 2nd Niger Bridge, others  

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By Dada Jackson

Minister of Works and Housing, Mr Babatunde Fashola, says the Federal Government will focus on the completion of ongoing road and bridge projects in the country rather than beginning new ones, in the implementation of the 2021 Budget.

He listed the road projects as Lagos-Ibadan, Abuja-Kaduna-Kano, 2nd Niger Bridge, Ilorin-Jebba, Jega-Tambuwal-Sokoto and Enugu-Port Harcourt, among others.

Fashola, in a statement made available to News Trends, spoke during the defense of his ministry’s proposals in the 2021 budget.

He listed roads whose completion would be prioritised during the budget year to include those categoriszed as A1-A9, adding that 18 of such road projects, which had reached appreciable level of completion had been identified across the country for completion within 12 to 15 months include those leading to the ports and major agricultural hubs across the six geopolitical zones of the country adding that the decision to prioritise those projects was in line with the mandate of President Muhammadu Buhari, whom, he recalled repeatedly emphasized the necessity to focus the Budget on completion of projects.

According to him, other categories of road and bridge projects on which the ministry will focus for completion during the budget year also include those that have attained 70 per cent completion, adding that subject to the availability of funds, such projects would be completed as early as possible.

He pointed out that some bridges which connect several geopolitical zones and Federal roads had not been maintained for several years before this administration.

Fashola added that some of the bridges required replacement of expansion joints and hand rails while others required major underwater repairs of exposed piles, pile caps and piers.

“Bridges like the Third Mainland Bridge, the Koton Karfe Bridge and the Makurdi Bridge are part of about 50 bridges being rehabilitated simultaneously among others,” he said.

He also said the ministry had its focus on the completion of the construction of Chanchangi Bridge along Takum-Wukari Road in Taraba State and Ikom Bridge along Calabar-Ikom Road.

Expressing the need for the support of the National Assembly in realizing the stated objectives, Fashola, who put the estimated cost of rehabilitating all the bridges at N80.984bn, however, pointed out that there was a need, in the course of each year, to address wash-outs and erosion envisaged with the subsiding discharge of flood waters nationwide.

“We are mindful of the limitation of resources but the frequency of these natural disasters caused by climate change and aging infrastructure must compel us to think of making provisions for emergencies”, he said, adding that the international best practice for such emergencies was between five and 10 per cent of the capital budget.

Fashola, who said the ministry had selected two roads and a bridge in each of the six geopolitical zones for enhanced funding during the budget year, also listed for adequate funding the Federal Government of Nigeria’s counterpart fund for projects financed by the China Exim bank.

On the ministry’s interventions on internal roads in federal tertiary institutions across the country, the minister, who said out of the 43 such projects 18 had been completed, explained that inadequate budgetary provisions had stalled the projects which, according to him, the ministry started since 2018/2019.

He stated that the 17.35 per cent cut in the 2020 budget made it impossible to pay contractors who were being owed N3.31bn while the money required to fix the remainder was given as N3.54bn.

Reiterating that the major challenge of the ministry in completing ongoing projects on time was inadequate budgetary provisions, the minister explained further that aside from the fact that the funds were inadequate, there was also the problem of timely release of funds to sustain annual cash flow requirement level adding that although funds from the Presidential Infrastructure Development Fund (PIDF) and SUKUK Bond had helped to bring some funding relief, the ministry’s exposure had continued to expand due to annual addition of new projects.

He said although the sum provided for highway projects in the 2021 budget was an improvement over the 2020 budget provision for the sector, it was still inadequate to address the funding challenges of highway projects pointing out that with about N1.2tn as the year 2021 projected cash flow requirement, funding for works planned to be executed on the projects in 2021 would have to be “efficiently optimised”.

Fashola said in order for his ministry to make significant impact on the improvement of the federal road network and boost the nation’s economy, there was an urgent need to enhance the release of funds for the projects under the Amended 2020 Budget to defray the outstanding payments; enhance budget ceiling for highway projects in the 2021 budget proposal to cover the execution of works during the year and leverage other alternative funding sources as well as make provision for emergencies to enable government to respond to damage and destruction caused by natural disasters, climate change and other unforeseen events.

The alternative funds, he explained, included the Presidential Infrastructure Development Fund (PIDF), which is being used to rehabilitate, reconstruct and expand the Lagos-Shagamu-Ibadan Dual Carriage way, Construction of Second Niger Bridge and rehabilitation of Abuja-Kaduna-Zaria-Kano Dual Carriageway.

They also include the Sukuk Bond being used to fund a total of 44 road and bridge projects, which are mainly dual carriageways on major arterial routes A1-A9 on the Federal road network using the 2020 Sovereign Sukuk Issuance and Tax Credit Scheme being used in the construction of Bodo-Bonny Bridge across Opobo Channel in Rivers State and the construction/rehabilitation of Lokoja-Obajana-Kabba-Ilorin Road Section II in Kwara and Kogi States, among others.

On the issue of delay in project completion raised by committee members during the interactive session, the minister said aside the twin challenges of inadequate funding and delayed releases, there was also the fact that some of the roads carry heavy traffic which had to be managed while construction, reconstruction or rehabilitation was going on.

Fashola said it was necessary to put some measures in place for the safety of both the workers and commuters.

The minister told the lawmakers, “When we talk about delay of projects, I would have loved you to have specifics of what is considered as delays. It is important to understand what happens at the construction site, especially on highways, where we are reconstructing and commuters still have traffic,” adding that ideally on a construction site traffic should be shut down.

He cited as examples the Third Mainland Bridge in Lagos with an average Daily Traffic (ADT) of 122,978 vehicles, the Koton Karfe Bridge with Average Daily Traffic of 11,942 vehicles and the Makurdi Bridge, adding that the Lagos-Sagamu-Ibadan carries the heaviest daily traffic in the country followed by the Abuja-Kaduna-Kano Road.

On why the Sukuk could not be expanded to fund other road projects as a means of overcoming the problem of inadequate funding, he explained that at every issuance, there was a specific amount which the government could withdraw, adding that no money would be left as reserve for Sukuk fund.

Business

Nigeria’s oil revenue not enough to cover petrol import costs – Finance minister

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Nigeria’s revenue being generated from its low oil production cannot cover the cost of imported petrol, Minister of Finance, Budget and National Planning, Zainab Ahmed, has said.

She stated this on Thursday in an interview with Reuters on the sideline of the World Economic Forum (WEF) in Davos.

She said the Federal Government hopes that oil production will average 1.6 million barrels per day (bpd) this year.

In the first quarter of 2022, Nigeria’s oil production averaged 1.5 million bpd.

The minister said, “We are not seeing the revenues that we had planned for. When the production is low it means we’re … barely able to cover the volumes that are required for the (petrol) that we need to import.”

This year, the FG had budgeted 1.8 million bpd of production, but frequent crude theft and attacks on pipelines continue to affect the nation’s wealth.

In April, it asked the national assembly to drop the projected production volume to 1.60 million barrels per day.

Despite higher oil prices due to the Russia-Ukraine war, under-recovery costs, also known as petrol subsidy, continue to erode gains.

Nigeria has spent about N1 trillion on petrol import shortfall in the last four months and will spend up to N4 trillion this year. This has also dwindled the federation revenue — just as the Nigerian National Petroleum Company (NNPC) Limited has been unable to remit any amount to the government purse this year.

On the recent hike of the monetary policy rate by the Central Bank of Nigeria (CBN), the minister said the move was necessary due to policy adjustments by the US Federal Reserve and central banks in Europe.

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Aviation

No plane crashed in Lagos – FAAN, NEMA

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Two government agencies, the Federal Airports Authority of Nigeria and National Emergency Management Agency, have dismissed reports of a fresh plane crash in the Ikeja area of Lagos.

An internet user who saw a plane being towed away had sent the picture to the social media, concluding that it was the wreckage of a fresh plane crash in Lagos.

The aircraft, which had missing wings, was spotted on Ikeja-Agege road, causing gridlock along the route on Tuesday as the news went viral on the social media.

But FAAN in a terse statement posted on its social media handles, said Nigerians should disregard the news.

It stated, “The Federal Airports Authority of Nigeria would like to inform the general public to disregard the news making the rounds on social media about an alleged crash at Ikeja Airport.

“The aircraft was sold by the owner to a buyer, who was taking it to its final destination.”

Also, Ibrahim Farinloye, the zonal coordinator, South-West, NEMA, said after due consultations with all critical stakeholders and tracking of all incoming and outgoing flights in Lagos, there was no plane.

An aviation analyst, Daniel Dikio, had also tweeted his observation of the viral video.

“It is an Airbus A319, hasn’t flown domestically in years. I can see traces of a green logo; it likely belonged to First Nation Airways in its time.

“The wings are separated cleanly; this wouldn’t happen in a crash. The separation is a sign of dismantling.

“There is no damage to the fuselage, almost impossible given the purported circumstances”, Dikio noted.

 

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Business

FG targets 1.4mbpd domestic refining before 2027

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Minister of State for Petroleum Resources, Chief Timipre Sylva

The Federal Government has disclosed plans to actualise 1.4 million barrels per day, mbpd, domestic refining of crude oil in the next five years.

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