President Muhammadu Buhari
In what appears to be one of his parting gift to Nigerians as his administration winds down on May 29 this year, President Muhammadu Buhari has given approval to the recommendation for the Nigerian National Petroleum Corporation Limited, to invest N1.9trn in the reconstruction of 44 federal roads under the tax credit policy.
The approval was given during the Federal Executive Council meeting which was held at the Presidential Villa, Abuja.
The meeting was presided over by Vice President Yemi Osinbajo.
The Spokesman to the VP, Mr. Laolu Akande, briefed State House correspondents on behalf of the Minister of Works and Housing.
The Federal Executive Council approved the recommendation to invest in the reconstruction of selected federal roads under the Federal Government Road Infrastructure Development and Refurbishment Investment Tax Credit Policy phase 2 by the Nigerian National Petroleum Corporation (NNPC) Limited and its subsidiaries.
He said, “So, the council approved the proposal by the Ministry of Works and Housing for the reconstruction of 44 proposed federal roads with a total length of 4,554 kilometers in the total sum of N1.9trn.’’
The approval is coming 15 months after the National Oil Company expressed interest to invest in the reconstruction of selected federal roads in order to sustain a smooth supply and distribution of petroleum products across the country.
Buhari had on January 25, 2019, signed the Executive Order 007 which was the instrument that brought about the Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme, the objective was to unlock funding from the private sector to critical road infrastructure in the country.
The Executive Order 007 was designed to empower private companies to finance construction or refurbishment of federal roads designated as “Eligible Roads” under the scheme and recoups their investments through deduction of the approved total costs expended on the project from their annual Companies Income Tax.
The Road Infrastructure Scheme is a Public-Private Partnership intervention that enables the Federal Government to leverage private sector capital and efficiency for the construction, refurbishment of critical road infrastructure in key economic areas in Nigeria.
Under the initiative, the Private participants of the scheme provide the funds for the construction or refurbishment projects and in exchange, the participants are entitled to recoup the funds provided as a credit against the Companies Income Tax they are expected to repay.
Under the initial programme, the NNPC is currently constructing a total of 1,804.6 kilometres of roads at a total cost of N621, 237,143,897.35.
A breakdown of the project funding showed that the North-Central geo-political zone got the highest chunk of N244.87bn for the construction of 791.1 kilometres of roads.
The North-Central is made up Benue, Federal Capital Territory, Kogi, Kwara, Nasarawa, Niger, and Plateau State.
The South-South geo-political zone emerged the second highest beneficiary of the NNPC Road Infrastructure Development and Refurbishment project with the sum of N172.02bn for a total of 81.9 kilometres of road.
The zone is made up of Akwa-Ibom, Bayelsa, Cross-River, Delta, Edo, and Rivers state.
The South-West followed with a total allocation of N81.87bn for the construction of 252.7 kilometres of roads.
The region is made up of Ekiti, Lagos, Osun, Ondo, Ogun, and Oyo State.
Similarly, the NNPC allocated the sum of N56.12bn to the North-East for the construction of 273.35 kilometres of roads under the scheme.
The states expected to be covered under this zones are Adamawa, Bauchi, Borno, Gombe, Taraba, and Yobe.
For the South-East geo-political zone, the sum of N43.28bn was earmarked for the construction/rehabilitation of 122 kilometres of road.
The zone is made up of five states and they are Abia, Anambra, Ebonyi, Enugu,and Imo.
Further breakdown of the NNPC schedule showed that the North-West geo-political zone which is made up of Kaduna, Katsina, Kano, Kebbi, Sokoto, Jigawa, and Zamfara got the least allocation.
The zone was allocated the sum of N23.05bn for the rehabilitation of 283.5 kilometres of road.
The road projects being funded by NNPC and the equivalent amount is deducted by the Federal Inland Revenue Service from the National Oil Company’s tax obligations.
Through the scheme, the NNPC has been serving as an enabler for building the Nigerian economy and it is collaborating with key stakeholders such as the Ministry of Works and the FIRS on the execution of the initiative.
This is in response to the plight faced by petroleum products marketers in transportation which affects nationwide distribution.
Currently, engagements are ongoing with unions and other stakeholders to ensure smooth delivery of projects according to standards and specifications.
Speaking during an inspection tour of some of the projects being funded by the NNPC, the Company’s Group Chief Executive Officer, Mallam Mele Kyari said in December said the NNPC understands the importance of road infrastructure to the development of the Nigerian economy.
He added that this why the National Oil Company is committed to the scheme to fund more roads.
The projects visited by Kyari are the Agbara-Badagry road project in Lagos, and the Bida-Lambata road project in Niger State.
He said NNPC had disbursed N15bn for the reconstruction of the Lagos Badagry Expressway under the Federal Government Road Infrastructure Tax Credit (RITC) Scheme.
The N15bn represents a 100 per cent payment of the funding of the Lagos-Badagry road rehabilitation under the tax credit funding of the NNPC Ltd.
Kyari said the NNPC will continue to commit massive investments in critical projects in the country for the benefit of Nigerians.
He described the tax credit scheme which is the initiative of President Buhari as a game changer in the Federal Government’s quest to scale up infrastructure projects in the country, noting that the NNPC will continue to support any effort of government aimed at growing the Nigerian economy.
Kyari expressed satisfaction with the progress of work so far done in the project sites visited, adding that the NNPC has done its part in releasing all the funds needed for their execution.
The GCEO said, “We are very happy about the state of this road development. We are very happy with this intervention across the country not just in this place.
“We are doing 1,800km across the country. We believe that this tax credit system which Mr. President has put in place is the game changer for our country.
“We believe that in the next 24 months, there will be massive change to the entire road network in this country and this is why NNPC is your company and working for all of us.
“We think that it is the best way to intervene and bring up our infrastructure.”
He said the projects are being implemented with the consultant which President Muhammadu Buhari used when he was the Chairman of the Petroleum Trust Fund.
He expressed optimism that with the experience of the consultant, quality roads will be delivered to Nigerians through the project.
Source: The WHISTLER
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