The Nigerian government has clarified the recent Memorandum of Understanding between the Ministry of Transportation and Messrs MPH Rail Development Limited, a United Kingdom firm.
On March 13, 2024, the Ministry of Transport signed the MOU for the building of the Port Harcourt–Enugu–Calabar–Abuja Standard Gauge Rail Line.
Reacting to recent reports stating that the FG entered into a Memorandum of Understanding with an “unknown” company, the government said the agreement is not considered binding.
Recall that upon the announcement of the MoU, some Nigerians took to their social media handles, particularly X, to express concerns over the UK firm’s capacity to deliver the project, saying the company is new in the rail construction industry.
Also, the critics agreed with a former presidential aide, Tolu Ogunlesi, who stated that there’s already a Warri—Itakpe Standard Gauge Rail.
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Ogunlesi suggested an extension of the existing route from Warri to Port Harcourt and from Itakpe to Abuja to get Port Harcourt — Abuja Standard Gauge Rail.
Responding to the most recent dispute, the ministry, on Sunday, provided clarifications in a statement signed by the ministry’s Director of Press and Public Relations, Olujimi Oyetomi.
Parts of the statement read, “For clarity, a Memorandum of Understanding or MoU is a non-binding agreement that states each party’s intentions to take actions, conduct a business transaction or form a new relationship.
“It is not a legally binding agreement.
“It provides only a platform for further agreement, discussion, scrutiny and the provisions of required guarantees by the parties to reach agreement if the parties are satisfied.
“The MoU in question arose from an unsolicited proposal presented by the British African Business Alliance, BABA, an association based in the United Kingdom with an interest in businesses in Africa. Its proposal was initially submitted to the ministry on 27th August 2019.
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“As required, the business, Outline Business Case was submitted to the Infrastructure Concession and Regulatory Commission, ICRC, on 8th December 2023. The major attraction of the proposal is BABA/MPH’s initiative to achieve 100% private sector funding for the project with no loans or debt to the Nigerian government or any of its agencies as captured in Article 3.3 of the MoU.
“The regulatory Commission on 27 December 2023 approved and issued a conditional OBC Certification. It is pertinent to note at this juncture that COVID-19 was a major contributor to the time lag between the initial proposal and the ICRC OBC Certification”.
