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FG Threatens to Cancel Abuja Airport Runway Contract Over Contractors’ N532bn Variation Demand

January 23, 2025

 

The Federal Government has expressed dissatisfaction with the contractors handling the second runway project at the Nnamdi Azikiwe International Airport, Abuja, after they requested a variation of N532 billion from the initial N90 billion contract.

Festus Keyamo, the minister of aviation and aerospace development, revealed this during the ministry’s 2025 budget defense before the national assembly’s joint committee on aviation on Wednesday.

The project, initially approved by the Federal Executive Council (FEC) in March 2022 at a cost of N92.123 billion, has faced delays. In September 2023, Keyamo assured that the runway would be completed within 12 months. However, the contractors’ new demand for a significant increase in costs has stalled progress.

Keyamo said the contractors received an initial disbursement of N30 billion, part of which was used to address land compensation for affected communities and begin excavation work. However, he described the proposed variation as unreasonable and unacceptable.

“The variation that the contractors are bringing is a variation that I totally disagree with. I will not go ahead with that variation; the president himself doesn’t like variation,” Keyamo stated.

“If a contract was awarded for N90 billion, and they are proposing N532 billion variation within a space of two years, I will not accept it. The option I have is to cancel the contract.

“So, with the situation now, we have two proposals on the table which I will take to the president, and I will consult my chairman. This country cannot go on with such unreasonable variations.”

The minister emphasized that the government is exploring alternative options, including terminating the contract if the demand is not revised.

Keyamo also disclosed that the ministry’s 2025 proposed budget is N71 billion, with N69 billion allocated for capital projects, N1 billion for personnel costs, and N745 million for overhead expenses.

Earlier, Abdulfatai Buhari, chairman of the joint committee, emphasized the importance of ensuring efficient use of allocated funds for tangible results.

The senator commended the aviation ministry for progress achieved under the current administration but warned that the national assembly would intensify oversight of the ministry and contractors.

He added that the Nigeria Airspace Management Agency (NAMA), previously excluded from the 2023–2024 budget, has been reinstated in the 2025 budget.

“This budget event will be a critical step in our efforts to ensure that our nation’s resources are allocated efficiently and effectively,” Buhari said.

He urged the ministry and its agencies to cooperate promptly with the national assembly’s summons and inquiries, reiterating the legislature’s authority to hold the aviation sector accountable.

The runway project, seen as critical to improving aviation infrastructure in Nigeria, now faces uncertainty unless an agreement is reached between the government and the contractors.

Written by Adeyemi Adewale




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