How Obj, el-Rufai Awarded Abuja Rail Contract without Design, Inflated Contract

How Obj, el-Rufai Awarded Abuja Rail Contract without Design, Inflated Contract

The Senate Committee on Federal Capital Territory (FCT) was yesterday told how former President,Chief  Olusegun Obasanjo, and the then FCT Minister, Nasir el-Rufai, allegedly awarded Abuja railway contract in 2007 by fiat without a design or Memorandum of Understanding (MoU).

Project Manager of a Chinese firm, CCE, handling the project, Etim Abak, who made the disclosure when the committee was on oversight inspection of the project, said the contract was signed by el-Rufai on the basis of an incalculable estimate.

The committee also said it had discovered that the contract initially claimed to have a coverage of 60.67 kilometres was inflated by $10 million per kilometre, adding that the length was later reduced to 45 kilometres without refunding the amount paid for extra 15.67 kilometres that was later cut off.

Leading the committee, its Chairman, Dino Melaye, demanded the refund of $195.8  million which he described as the estimated amount for the 15.67 kilometres eventually cut out of the contract.

According to Abak, the contract which was signed by el-Rufai without a design and an MoU, was only executed on the basis of conceptual design.

“The contract was awarded based on conceptual design and estimates were not properly done. There was no formal design submitted and rail bridges and crossover bridges were not captured in the contract,” Abak said.

In his response, Melaye who claimed his findings had shown that the project was inflated by over $10 million per kilometre, added that the contract was awarded at the rate of $841.645,898 with the duration of 48 months while the scope of work was 60.67 kilometres standard gauge and meant to be double railways.

“Now, you have reduced the length of the kilometre standard gauge from 60.67 kilometres to 45.245 kilometres. Meanwhile, there is no concomitant reduction if you juxtapose the length of kilometres and the reduction in terms of the cost.

“If we are to spend $841 million for 60.67 kilometres and now you have reduced to 45.245 kilometres and the only reduction in terms of monetary value is from $841.6 million to $823 million and with reduction of just about $17 million that to me is not commensurate to the reduction in terms of length, ‘’ he said.

He added: ‘’The federal government has so far invested $31.5 billion and another $7.6 billion from the SURE-P fund and if you put these together, we have altogether $39.1 billion invested in the rail project, leaving the balance of $113. 233 million. The sum of $3 million was proposed in the 2016 national budget of the FCT for the rail project.

“If you look at this, I would want to say that I did a personal research and looked at rail construction of the same specifics, of the same technology across the globe and one cannot but complain that this railway project in Nigeria  is on a very high side.”

The committee also questioned the rationale behind obtaining $500 million from Exim Bank of China for the project by the federal government, arguing that the money already injected into the project was more than enough to complete the project. Melaye insisted that the contract was inflated.

‘’From our research and it’s very simple, the world is now a global village. As you are sitting here now, on your phone, you can google even in India and Egypt. Fortunately, one of those projects in Zambia was also done by this same company, CCE.

“We have six countries and the average cost per kilometre, none is $4 million per kilometre. Why is the Nigerian project costing $13.8 million approximately $14 million dollars per kilometre.”