The Lgos
State Government has announced the termination of its concession
agreement with the Lekki Concession Company. Find a press statement from
the State Govt below..
The Lagos
State Government wishes to state clearly that it has neither terminated nor
cancelled the Concession Agreement it entered into with the Lekki Concession
Company Limited (LCC) to reconstruct and expand the 49.36 km Eti-Osa Lekki-Epe
Expressway.
To set the
records straight, Lagos State Government is engaged in buying back the rights
pertaining to the concession ahead of the 30-year period stipulated in the Design,
Build, Operate and Transfer (DBOT) Concession Agreement. This is to be achieved
by purchasing all the shares in LCC.The State
Government came to this decision to buy back the rights in the light of several
developments clearly not envisaged in the 2006 Concession Agreement (which
became effective in 2008) a few of which are highlighted below.
The
project, given
its pioneering nature, had some underlying assumptions and market indicators
under which the transaction was concluded which have since drastically changed
in a manner that it can no longer be sustained in its current form. Such include
the devaluation of the Naira and costs of construction.
The
LCC, which is the special purpose vehicle representing the investors, formally
brought it to the attention of the State Government that given the rapid rise
in interest rates on local loans, and other cost parameters, it is compelled to
raise tolls currently being charged at Toll Plaza One from N120.00 to N144.00 per Car.
The
Concessionaire also brought it to the attention of the State Government, that
as provided for under the agreement, tolling would have to commence at Toll
Plaza Two.
In
addition, the Concessionaire indicated that unless it realised more income from
increased rates at Toll Plaza One and commence tolling at the same rate per Car
at Toll Plaza Two, it would not be able to meet its commitments to investors in
the project and continue to fund completion of the remaining sections of the
road.
Furthermore,
the LCC stated that Toll Plaza Three, as contained in the Agreement, must be
built and tolls collected for the continued viability of the project.
Under such
circumstances, the Lagos State Government felt obliged to buy out the interests
of the Concessionaire in advance of the hand-over date of 2038 under a mutual settlement
option also expressly provided for in
the Concession Agreement. This is after due consultation with all major
stakeholders including the Lagos State House of Assembly based on various
feedback and agitation made to the Government.
Contrary
to
the misleading reports by some sections of the media on Wednesday,
August 27,
2013 from the State House of Assembly’s consideration and approval of
the 2013
Supplementary Budget, the buy-back is not and does not amount to a
“termination” or “cancellation” of the concession of Eti-Osa, Lekki-Epe
Expressway.
The
significance of the buy-back, for which the State Government deserves
commendation, is that it allows the Government to take full control over the
determination of the toll rates in order to continue to make it affordable for
road users. The LCC shall therefore continue to operate as a fully commercial
entity for the benefit of taxpayers and the larger society.
More
importantly, it would also preserve the ability of the Government to complete
and deliver the infrastructure by direct budget funding, which was also one of the
reasons for the presentation of the Year 2013 Budget Re-Ordering to the State
House of Assembly.
In addition
LASG wishes to reaffirm its unflinching commitment to the adoption of PPP Model
as a complementary policy thrust for the acceleration of infrastructure
delivery towards improving the living standards of the populace. Lagos remains
an investor friendly State that shall continue to ensure the sanctity of
contracts, as in this case, in sustaining investors’ confidence in its
investment climate as a preferred destination.
The general
public is therefore enjoined to continue to cooperate with LCC's officials and
operatives as it continues the expansion and construction works on the 49.36km
Eti-Osa Lekki-Epe Expressway and the operations of the toll collection systems.
LASG wishes you a safe and happy motoring experience on the modernised
expressway with its associated free value added services such as 24/7 security
patrol, vehicle break down recovery, ambulance services, amongst others.
Eko oni baje O!
| | | |
No comments:
Post a Comment