FG: We Can No Longer Deliver $1.96bn Eastern Railway Corridor By May

The federal government has disclosed that Its initial promise to complete the narrow gauge Eastern railway corridor before the end of the President Muhammadu Buhari’s administration next year was no longer realistic citing insufficient funds as reason.

Buhari had two years ago performed the groundbreaking of the $1.96 billion rail-line project, saying it would stimulate economic activities in 14 states it covers.

The benefiting states included the five south-east states of Abia, Anambra, Imo, Ebonyi and Enugu as well as nine others – Rivers, Nasarawa, Benue, Plateau, Kaduna, Yobe, Borno, Bauchi and Gombe.

Then Minister of Transport, Hon Rotimi Amaechi, had said the Port Harcourt-Maiduguri line would be delivered before the end of the tenure of the present administration.

But speaking on the issue yesterday, after the Federal Executive Council (FEC) meeting presided over by President Muhammadu Buhari at the State House, Abuja, Minister of Transportation, Mu’azu Jaji Sambo, disclosed that financing the project had become an issue.

According to him, the federal government has not been able to obtain the foreign counterpart funding embedded in the project, making it impossible to fund it as envisaged.

His words: “Now, the Eastern line is the line from Port Harcourt to Maiduguri, it has been segmented in such a way that the first part of the works covers from Port Harcourt to Enugu.

“The truth of the matter is that if there was a promise to deliver this line before the end of this administration, this promise is no longer feasible because, when the contract was approved, it was approved on the premise that 85 percent will be funded through foreign loan, while 15 per cent will be the counterpart funding from the national budget.

“Since that approval, we have not been able to obtain that 85 percent foreign loans for this project. We have been funding it through the national budget on the basis of the 15 percent counterpart funding of the federal government. And therefore, funding has been a major challenge for this project.”

On the status of the dredging of the Calabar Channel, Sambo said the project, which had suffered series of setbacks, as a result of litigations, would soon be resumed as Buhari had directed his ministry, in collaboration with that of Justice, to ensure that the issues are resolved amicably.

He said: “You are aware that of the three ports (Warri, Port Harcourt and Lagos), the NPA had encountered difficulties with the JV partnership in respect to the Calabar channel dredging. This has been as a result of several litigations from both sides that the Nigerian Ports Authority had made with the joint venture partner Niger Global.”

The minister noted that the issues were now being resolved, saying, “following Presidential intervention, the Ministry of Transportation and the Federal Ministry of Justice have been directed to put in everything they can to resolve all outstanding court cases with a view to having a full resumption of this very, very laudable project. This we are in the process and should be concluding very, very soon.”

While it is one of the oldest ports in the country, the Calabar Port had been operating below its potential due to draft issues which has made it impossible for large vessels to navigate through the channel.

As a result, the Lagos, Onne and Port Harcourt ports have continued to receive more cargo traffic that ordinarily would have berthed in Calabar.