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Obasanjo, El Rufai Awarded Rail Project Without Design, MoU – CCECC

The China Civil Engineering Construction Corporation (CCECC) handling the Abuja rail project, yesterday, told the Senate Committee on Federal Capital Territory (FCT) that former President Olusegun Obasanjo awarded the project in 2007 without a design and Memorandum of Understanding (MOU).

Project Manager of the Chinese company, Mr. Etim Abak, also told the lawmakers that the then Minister of FCT and current Governor of Kaduna State, nigeria railwayMallam Nasir el- Rufai, allegedly signed the contract based on uncalculated estimates.

The shocking revelations were made as a sequel to the committee’s discovery that the contract, which stood at 60.67 kilometres, was inflated by $10 million per kilometre.

It was also revealed that the length of the rail project to be constructed was later valued at 45 kilometres, yet the cost of the initial excess value of 15.67 kilometres was not refunded. Consequently, the Senate committee, led by Dino Melaye (APC, Kogi West) has demanded the refund of $195,878,296.74, being the amount for the 15.67 kilometres cut out by the Chinese firm.

Abak, who answered questions from members of the committee when they made an oversight tour to the project site, said the contract was signed by the then FCT Minister without design and MoU, saying it was carried out based on what he simply identified as 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,” he said. Melaye, while speaking at the site, said his research showed that the rail project was inflated by over $10 million per kilometre, wondering why such corrupt act was perpetrated by the handlers of the project.

Melaye, who noted that the contract sum for the project was $841,645,898, while project completion period was 48 months and the scope of work, 60.67km standard gauge, with double railway tracks and associated permanent way within FCT, said that the whole project was shrouded in fraud.

He wondered why the project, which length initially stood at 60.67 kilometres, was later reduced to 45.245 kilometres without reduction in the cost of the project.

He said: “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 added.

“The Federal Government has, so far, invested $31.5 billion and another $7.6 billion dollars 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. 233,155.32.

“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.”

He expressed concern that it was costing the Federal Government so much to construct a railway of just 45 kilometres unlike the construction of the same specifics across the globe. The senator also queried the rationale behind government’s loan of $500 million from Exim Bank of China for the project, saying the money the Federal Government had so far injected into the project was far enough to execute the entire project.

“From my own calculation, in fact, from my comparison with other rail projects across the world, the Federal Government’s investment in this project is enough to execute the project without taking a loan as high as $500 million from China,” he said.

Melaye said that he had done enough research on the rail project and found that it was the costliest all over the world. “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, CCECC. “We have six countries and the average cost per kilometre, none is above $4 million per kilometre. Why is the Nigerian project costing $13.8 million per kilometer?” he asked.



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