Tension Rises as Two Major Airports Near Commercial Closure Despite House of Reps Suspension of Concession Process.

Despite the House of Representatives’ resolution to suspend the concession process for Nigeria’s four major airports, reports shows that two of the facilities were already nearing commercial closure. This development has caused tension as officials of the Federal Government maintain that the concession of the airports was approved by the Federal Executive Council, necessitating a potential reversal process.

The major international airports in Lagos, Abuja, Port Harcourt, and Kano were initially put up for concession during the tenure of President Muhammadu Buhari. In May of this year, the Federal Government announced the successful concession of the Nnamdi Azikiwe International Airport in Abuja and the Mallam Aminu Kano International Airport in Kano. The announcement, made by James Odaudu, the then Special Assistant on Public Affairs to the immediate past Minister of Aviation, emphasized that the concession came after approval from the Federal Executive Council.

However, last Wednesday, the House of Representatives passed a resolution to halt the concession of the airports, arguing that the process lacked due process and proper adherence to established laws. In response, the House mandated its Committee on Aviation to conduct a thorough investigation into the concession process. The House is set to inaugurate its various committees on Thursday.

The House of Representatives’ resolution followed a motion titled “Need to Investigate the Concession of Airports in Nigeria” during plenary, brought forth by Kama Nkemakonam. Nkemakonam voiced concerns over the commissioning of the most viable airports in Nigeria to foreign firms through resolutions by the Federal Executive Council, bypassing due process, public accountability, and established laws.

Despite the suspension, the Infrastructure Concession Regulatory Commission’s Head of Media and Publicity, Manji Yarling, disclosed that the concession process for two of the airports was still progressing and nearing completion. The Abuja and Kano airports’ concession projects were heading towards commercial closure, while the Lagos airport’s concession had encountered a stall. Additionally, there has been no investor interest yet for the Port Harcourt airport, according to the commission’s spokesperson.

Yarling said, “The Abuja and Kano International Airport concession projects have been approved by FEC. The Project Delivery Team and the preferred bidders are finalising the draft agreements. Going by the PPP process, once this is finished, there would be a commercial close.

“The initial plan was to concession four airports – Lagos, Abuja, Kano, and Port Harcourt. Whereas Abuja and Kano International Airports got FEC approval, the concession of Lagos was stalled after the issuance of the ICRC Outline Business Case Compliance Certificate, due to a court case by one of the bidders during the procurement process.

“The Port Harcourt Airport was also advertised, but no investor bid was received. The process of procurement will be re-initiated.”

On February 6, 2023, the Federal High Court in Lagos issued an order to halt the planned concession of the Murtala Muhammed International Airport, Lagos, and cargo terminals. The order was given pending the hearing and determination of a lawsuit filed by Sifax Group of Companies Limited, which challenged the bidding process.

When asked about the implications of the House Representatives’ decision on the preferred bidders for the Abuja and Kano airports, an ICRC official stated that clarification should be sought from the House Representatives.

Regarding the possibility of the ICRC reviewing or reversing the decision on the preferred bidders for the airports, the official emphasized that the ICRC is an agency of the government.

“FEC is the highest decision-making organ of the executive arm of the Federal Government, ICRC cannot reverse the Federal Executive Council’s decision. After FEC approval and commercial close, they (preferred bidders) become concessionaires.”

On why the Federal Government had yet to hand over the airports to the preferred bidders, the ICRC official replied, “The concession of the Abuja and Kano International Airports was approved by the Federal Executive Council on May 17, 2023.

“Going by the PPP (public-private partnership) process, there should be a commercial close which is contract signing between the preferred bidder and the MDA (Ministry, Department, and Agency) ‘Grantor’, after which the project can fully commence.”

Reacting to the claims of the House of Representatives that the concession of the airports did not follow due process, the Head, of Press and Public Affairs, Federal Ministry of Aviation, Oluseyi Odutayo, argued that the FMA followed the stipulated process.

“At the ministry, we are doing the right thing and we believe that there is no secret about the matter. It is left to the government to decide. The ICRC is the regulatory body and they will be able to tell the world and the ministry if we followed due process, which I know we did.

“So the decision will be taken by the government. The ministry will not take any decision or state any opinion on that for now. That is our take on that matter.”