Rita Odafe
Government Revokes Julius Berger’s Highway Contract
The federal administration under Tinubu has annulled part of the highway contract between Abuja and Kaduna that was subcontracted to Julius Berger, a leading construction firm.
Awarded in 2018 during the presidency of Muhammadu Buhari, the contract has encountered notable delays in its execution.
While the section from Kaduna to Zaria has been finished and Zaria to Kano is almost done, the Abuja-Kaduna segment has progressed only by 27% over the past six years.
During a ceremony on October 17 to mark the road’s rehabilitation, Works Minister Senator David Umahi criticized Julius Berger for its sluggishness and claimed the firm was “playing politics” with the project. According to Daily Trust, he noted that the company had been slow and continuously sought more financial support.
“Berger stated it needs N1.5 trillion to complete the job,” said Umahi. “We began discussions in September last year, sending weekly letters. We ultimately indicated that even with their requested funds, completion could still take four years due to traffic issues and kidnappings on the route.”
The minister pointed out that the Federal Executive Council had approved a revised project cost of N740 billion, yet Julius Berger persisted in demanding additional funds. “We proposed dividing the road into three segments, which the President endorsed. They agreed to this after negotiations, but we later realized they were stalling,” he added.
Umahi expressed exasperation with the construction company’s tactics, stating, “They subsequently came back asking for an increase to N740bn, which we got approval for from FEC, only for them last week to request an increase to N903bn.”
The minister firmly rejected this new demand, noting that acquiescing would set a troubling precedent for other contracts, potentially inflating project costs to N4 billion per kilometer. “Our stance is that we will not raise the project cost for Julius Berger beyond N740bn. The game is finished. If they cannot proceed, we will assign the work to other capable contractors at a lower price,” he explained.
Additionally, Umahi announced that the dual carriageway, extending 375 kilometers (750km total), would have an added 7.5 kilometers in Kogi and Kano states.
Earlier, Engineer Bakare, the Director of Highway Construction at the Ministry of Works, mentioned that the project scope had been modified, with remaining sections reassigned to Dangote and BUA. Dangote will oversee a 38-kilometer dual carriageway in the first segment of the highway, costing N145 billion with a completion timeline of 14 months.
The project, which was initially financed through the Presidential Infrastructure Development Fund, will now shift to funding via the Tax Credit Scheme.
