The federal executive council yesterday approved the proposal by the federal ministry of works and housing for the Nigerian National Petroleum Company Limited (NNPCL) and its subsidiaries to invest N1.9 trillion in the reconstruction of selected federal roads under the Federal Government Road Infrastructure Development and Refurbishment Investment Tax Credit Policy, phase two.
The meeting was presided over by the vice president, Prof Yemi Osinbajo.
Briefing journalists after the meeting, spokesman for the vice president, Mr. Laolu Akande said the memo for the request was presented by minister of works and housing, Babatunde Fashola.
Akande said the ministry also got approval for the concession of nine road corridors under the pilot phase of the value added concession of the highways development and management initiative following the issuance of the requisite full business case compliance certificates by the Infrastructure Concession Regulatory Commission (ICRC) for a period of 25 years.
He further stated that the minister also got council’s approval for the augmentation of contract for the rehabilitation of the Oshogbo-Ilesha Road in favour of Messers Orizon Construction Company in the sum of N1.2 billion, thereby revising the subsisting contract sum from N3 billion to N4 billion, representing an increase of 33 per cent of the original sum.
“The minister for works and housing also presented a couple of memos. The council approved the recommendation to invest in the reconstruction of selected federal roads on the federal government road infrastructure development and refurbishment investment tax credit policy, phase two, by the NNPC and its subsidiaries.
“So the council approved the proposal by the Ministry of Works and Housing for the reconstruction of 44 proposed federal roads with a total length of 4,554 kilometres in the total sum of N1.9 trillion.
“In other memo, the minister of works and housing also got approval of the council for concessionaires for nine road corridors under the pilot phase of the value added concession of the highways development and management initiative, following the issuance of the requisite full business case compliance certificates by the infrastructure concession regulatory commission for a period of 25 years for each road corridor
“The roads that will be under this first phase are the Benin-Asaba corridor; Abuja-Lokoja-Onitsha-Owerri-Aba-Shagamu-to Benin; Abuja-Keffi-Akwanga-Lafia-Makurdi; Kano-Maiduguri, that is the Kano Shauri; Enugu-Port Harcourt; Lagos-Ota-Abeokuta; and Lagos-Badagry-Seme,” he said.
The road infrastructure scheme is a public-private partnership intervention that enables the federal government to leverage private sector capital and efficiency for the construction and refurbishment of critical road infrastructure in key economic areas in Nigeria
Under the initiative, the private participants of the scheme provide the funds for the construction or refurbishment projects and, in exchange, the participants are entitled to recoup the funds provided as a credit against the Companies Income Tax they are expected to repay.
Under the initial programme, NNPC is currently constructing a total of 1,804.6 kilometres of roads at a total cost of N621, 237,143,897.35
A breakdown of the project funding showed that North-central geo-political zone got the highest chunk of N244.87 billion for the construction of 791.1 kilometres of road
North-central is made up of Benue, Federal Capital Territory (FCT), Kogi, Kwara, Nasarawa, Niger, and Plateau states.
South-south geo-political zone emerged the second highest beneficiary of the NNPC Road Infrastructure Development and Refurbishment project with the sum of N172.02 billion for a total of 81.9 kilometres of road. The zone is made up of Akwa-Ibom, Bayelsa, Cross-River, Delta, Edo, and Rivers states.
South-west followed with a total allocation of N81.87bn for the construction of 252.7 kilometres of road. The region is made up of Ekiti, Lagos, Osun, Ondo, Ogun, and Oyo states.
Similarly, NNPC allocated the sum of N56.12 billion to the North-east for the construction of 273.35 kilometres of road under the scheme. The states expected to be covered under this zone are Adamawa, Bauchi, Borno, Gombe, Taraba, and Yobe.
For South-east geo-political zone, the sum of N43.28 billion was earmarked for the construction/rehabilitation of 122 kilometres of road. The zone is made up of Abia, Anambra, Ebonyi, Enugu, and Imo states.
A further breakdown of the NNPC schedule showed that the north-west geo-political zone, which is made up of Kaduna, Katsina, Kano, Kebbi, Sokoto, Jigawa, and Zamfara got the least allocation. The zone was allocated the sum of N23.05 billion for the rehabilitation of 283.5 kilometres of road.
The road projects are being funded by NNPC, and the equivalent amount is deducted by the Federal Inland Revenue Service (FIRS) from the national oil company’s tax obligations.
