By Cross Udo, Abuja
Yesterday, the Federal Executive Council (FEC) approved N757bn as augmentation for the dualisation of the 489km Obajana-Benin Road.
This came as the government explained that the rising cost of production is responsible for the recent cement price hike and not its concrete road policy.
These, among others, were disclosed by the Minister of Works, Senator Dave Umahi, while briefing State House correspondents at the end of the FEC meeting, presided over by President Bola Tinubu at the Council Chamber of the Presidential Villa in Abuja.
The Minister said the approval was sequel to the memorandum he presented to the Council.
He said apart from the additional N757bn as augmentation for the dualisation of the 489km Obajana-Benin Road, N2.23bn was also approved for the Isheri-Ogun Road and N114bn for Outer Marina shoreline protection.
He said, “Today we’ve got augmentation approved for Obajana in Lokoja to Benin Road, a total of 244km and 489km dualised. Recall that in 2012, this project was awarded to four contractors: CGC, Mothercat, Dantata & Sawoe, and RCC, at a total cost of N122bn, which was for light rehabilitation.
“Around 2018, the past administration reviewed the project, which is why you have a total of 489km and then got ‘No Objection’ from BPP. When I came on board in August, we were supposed to present the no-objection to FEC in line with due process, and we decided to review the project, one, to determine whether the dualisation was desirable in view of the economic challenges and two, to see the texture of the soil and what to do.
“So we had to restore the project now, but we didn’t increase the cost. We got approval for argumentation from N122bn to N897bn. The contractors were off-site because they would not be working and would not be paid based on the new basic rate. So we got them back to the site, and today, we got approval.”
*Says production costs are raising cement prices, not concrete roads
He explained that the rising cost of production is responsible for the recent cement price hike and not its concrete road policy.
Umahi said his insistence on concrete roads will not phase out traditional asphalt roads, which are only an alternative for sites with high water tables and poor conditions.
“This assertion is highly misplaced because the policy has not even taken off,” said the Minister of Works.
His remarks follow warnings by the Cement Producers Association of Nigeria that the FG’s plan to introduce concrete roads will raise the cement price from N5,600 to N9,000 per bag.
Yesterday, the House of Representatives invited top manufacturers, including Aliko Dangote Rabiu Abdulsamad, to discuss the product’s high cost.
The House’s resolution was a sequel to the adoption of a motion titled “Arbitrary increase in the price of cement by manufacturers of cement in Nigeria,” moved by a member representing Karu/Keffi/Kokona Federal Constituency, Nasarawa State, Mr Gaza Gbefwi, and his counterpart representing Shomolu Federal Constituency, Lagos State, Ademorin Kuye, during plenary yesterday.
Fielding questions on the issue, Umahi cited recently released documents showing that Dangote Cement Plc, BUA Cement Plc, and Lafarge Africa Plc spent N598.14bn on power during the whole year ended December 31, 2023.
He explained, “I just got a document this morning where three companies producing cement, Dangote, BUA, and Lafarge, said that in 2023, the total cost of their gas rose by over 42 percent. So, if the cost of their gas rose by 42 percent and then the import duty exchange rate has also gone up, it is expected that the cost of cement would go up.”
“But Mr President has discussed with them, and I think a couple of incentives are being made available to them, which should reduce the cost of cement. In Sokoto, where I visited recently, the BUA Executive Director said the ex-factory was N6,000. And that was down from N8,000. We are getting there because Mr. President has directed them to reduce the price, and they must comply. I think Mr. President has also offered them some incentives.
“So, it’s not because we go from asphalt to concrete. And we are not leaving the asphalt. It is an alternative, especially with a very high water table and poor sight condition.”
He said the Council also approved N2.23bn for the Federal Roads Maintenance Agency to rehabilitate the road from Isheri North to Ogun state.
“Now, under FERMA, we got approval to construct Isheri north, Lagos route to connect Ogun state. This is an alternative route to Lagos-Sagamu Road, and we will take it to Lagos-Sagamu when completed. But by law, you only toll a federal road when you have an alternative.
“This approval of about N2.23bn to connect Isheri North to Ogun state. It is a breakthrough that has freed the Lagos-Sagamu for tolling,” he revealed.
*Okays N114bn for Outer Marina shoreline protection
Explaining the Council’s approval for the N114bn Outer Marina shoreline protection, Umahi said, “The shore protection was done over 50 years back with sheet piles, and we had to take the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, on a tour with Julius Berger through the entire shoreline of 3.92km.
“We took the tour with Julius Berger, CCECC, CBC, and BuildWell and demanded that they inspect and then give us their proposal. Only BuildWell and CCECC brought their proposals.
Whereas CCECC quoted 3.2km at N134bn, BuildWell quoted 3.9km at N114bn. We sent the two to BPP, and BPP found merit in BuildWell because of the cost and, of course, the latest technology in doing shore protection using interlocking concrete, which will not be subject to rusting. So we got approval for Build Well to sum up N114bn.”
Umahi said the shoreline protection project was necessary given its proximity to the recently inaugurated Red Line and other existing structures.
He added that his ministry sought to leverage the low-water levels of the dry season to drive piles down the shore.
