Nigeria Railway Concession: Transnet Replaces GE

* Apapa Freight Rail Project on Course- Port Authority Chief

Following General Electric exiting of railway concession in Nigeria, the Nigerian government has confirmed Transnet of South Africa as the head of the concession consortium. Transnet is to raise the $2.7 billion dollar needed for the upgrade, Transport Minister, Rotimi Amaechi has disclosed
Commenting on the reported pullout of General Electric from Nigeria’s railway concession, the minister said, “I don’t know whether GE pulled out: GE is no longer into transportation. What happened is that it was a consortium; we have APM Terminals, Transnet, SinoHydro of China and GE.

“GE is the only one that is no longer into transportation business. So, Transnet has now taken the lead role as the head of the consortium. We are going ahead with the concession.

Asked if the GE’s pullout was a setback, Amaechi said, “What setback is that? Transnet can raise the $2.7bn.”

Bloomberg reported on Wednesday that GE said it was withdrawing from the railway concession and handing it over to Transnet SOC Limited in line with its strategy to exit the transportation business.

GE won a contract last year to manage Nigeria’s narrow-gauge rail network in partnership with three other companies, namely SinoHydro of China, Transnet, and APM Terminals.

They signed an agreement with Nigerian authorities in April to proceed with the interim phase of the narrow-gauge concession that is expected to grow freight haulage capacity in the country ten-fold to 500,000 metric tons annually.

The Managing Director, Nigerian Ports Authority, Hadiza Usman, said, “We have done an inspection to ensure that the rail lines are brought directly into the port. We visited several terminals; there will be areas where the Federal Government will take over for overriding public interest to ensure that the rail track comes in.

“We have situations where certain portions of warehouses, for example, will have to be taken away; we have some portions of land that we have to reclaim to ensure that the rail line gets to the quayside, and that is what is more important than having those warehouses.”

She said not all the terminals would be affected by the demolition, adding, “But, indeed, what is important for port operations is to ensure that cargo is evacuated efficiently and we are deploying intermodal transportation system, and this is one of the steps in introducing rail to the quayside of all our terminals.

“So, I think this is important and imperative, and there is overriding public interest for the government to come and take over certain spaces for this development. Whatever we do, we are going to be mindful of port operations; we will ensure that the quayside is left available for operations while certain portions will be rehabilitated.”

Usman said there would be discussions with terminal operators who would be affected by the demolition to ensure that they were compensated.

She said, “After this inspection, we are going to have another meeting where we will determine the exact increase in scope that the project will have in view of this visit because this visit has expanded the scope to ensure that, for example, we are going to cover Greenview Development Nigeria Limited; we are going to look at expanding into Eko Support Services Limited.

“We are also going to look at providing direct quayside and sidings for Port and Terminal Multiservice Limited. So, all these aspects need to be completed and the numbers will be presented to the Honourable Minister, and in turn, he will make the necessary request for approval from the Federal Executive Council.”

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