Home News FG, General Electric seal $45m deal on Lagos-Kano rail project

FG, General Electric seal $45m deal on Lagos-Kano rail project


The Federal Government and General Electric, GE, the leader of the consortium of firms awarded some rail contract projects in the country, have signed an interim phase agreement for the repair of the Lagos-Kano rail line.

Under the terms of the pact, GE would invest an initial $45 million out of the $2.7billion that will be paid when the main construction agreement is signed.

Confirming the signing of the agreement after the Federal Executive Council (FEC) meeting presided over by the Vice President, Prof. Yemi Osinbajo, in Abuja yesterday, the Minister of Transportation, Rotimi Amaechi, hinted that another $54 million would be spent on the repair of Port Harcourt-Maiduguri rail line.

The minister said that the FEC’s approvals were to enable the ministry procure the equipment that would assist GE carry out the rehabilitation of the narrow gauge.

He listed the project’s components to include, the construction of overhead travelling cranes, carriage and wagon workshops as well as diesel to assist GE as it flags off the work of repairing locomotives, coaches and wagons that would be used for the narrow gauge.

Amaechi explained that the rehabilitation work on the narrow gauge, which will start running before the completion of the standard gauge, would increase the speed of the trains on it to 40km/h from the 17km/h, which it runs at present.

He said: “By the time they come for the main construction agreement, they would have gotten $2.7billion of their own. When they do bring it and complete all the rehabilitation work, the narrow gauge would run at the maximum narrow gauge speed, which is 80km/h.”

According to him, the contract for Nigeria’s contribution in the agreement was awarded to two South African companies namely, Vipan Global Investment and Demark Cranes Corporation at a cost of N1.67 billion.

Also, the FEC also approved N1.2 billion contract for the procurement of 18 flat bed wagons to enable the Nigerian Railway Corporation (NRC) operate on the narrow gauge awarded to a Chinese company, Messrs CRRC of Shandon.

The minister clarified: “We did not agree to an exclusivity clause with GE. So, while they are operating their passenger locomotives and coaches and freight wagons, we also will be operating our own freight wagons and passenger locomotives and wagons.”