Project management Lagos
Metro Agbado Nigerian Railways
Blue Line being built Planned Blue Line Planned Red Line
Existing line Agege N Airport Oshodi
Jibowu Yaba
Okokomaiko
Volkswagon Lasu
Trade Fair Lagos Terminus
National Theatre Mile 2
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Ebute-Metta Junction
Iddo Marina IRJ
around stations and they are working with the Lagos state government to improve paths and walkways to the stations to make Lagos a more pleasant place to be and travel. “We are even looking at how cycling could be encouraged and reintroduced to Lagos,” Schabas says. “People used to cycle in the city 50 years ago but now the traffic is so bad that it is almost impossible.”
be sufficient to allocate revenue risk to the private sector, CPCS developed a full operating cost and financial model. The model assumed that the Lagos state government would fund most fixed infrastructure, and the concession for passenger rail service and infrastructure maintenance would be tendered. Lichti says this approach was beneficial for
several reasons: the assets perceived to be the most risky - the rail and station infrastructure - would be built by the government, greatly reducing the capital requirement of the private operator - without this option, the likelihood of project success was very low and large operating
subsidies would be required at expected levels of demand, the operations and maintenance concessionaire stands to make a profit and in addition pay a concession fee to
the state government, and private capital could be used to fund other investments - for instance a purpose-built gas-fired power station has been proposed by the preferred bidder to power the trains with the potential to sell excess power into the public grid, generating additional revenue.
After the conceptual design was completed in 2008, tender documents were issued in an international RFP following an initial prequalification. Separate tenders were released for the construction of the fixed infrastructure
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and the operations and maintenance (O&M) concession. Multiple bids were received for both tenders, and following negotiations, a contract was awarded for the construction of the fixed infrastructure to China Civil Engineering Construction Company (CCECC).
In the case of the O&M tender, negative bids were permitted. However, both bids received included concession payments to be paid to the government over the course of the 25-year concession. This vote of confidence for the project structure solidified the objective to allocate revenue risk to the private sector, minimising the need for government involvement post- construction.
In 2010 the contract was awarded to
preferred concessionaire, Eko Rail, a Nigerian company backed by emerging markets investment firm Verod Capital Management and supported by First Class Partnerships, Britain, which is providing technical and commercial assistance, Investec Bank, and several legal partners.
Mr Michael Schabas, a partner of First Class Partnerships, who is leading FCP’s work in Nigeria, says that in its operation plans for the line, Eko Rail has emphasised developing strong links with other public transport modes by offering through-tickets for buses. He says the concessionaire is also encouraging developments in and
Eko Rail is also in the process of establishing its own 25MW gas-thermal power station to supply electricity to the line, which will be located at the depot in Okokomaiko. Schabas says the concessionaire is not interested in getting involved in the electricity business, but admits there is potential to sell excess power into the grid. As the O&M concessionaire, Eko Rail is of course responsible for installing signalling and telecommunications systems and purchasing rolling stock. While Schabas says discussions about the signalling system are continuing, Eko Rail confirmed in September 2011 that it had purchased 255 subway cars from Toronto Transit Commission (TTC) for use on the line. Despite being 35- years-old, Schabas says the vehicles offer amazing value because apart from the first 10-15 years of their life, they were used only on peak services in Toronto clocking up around 70,000km per year.
Schabas says that the trains are formed of a steel frame and a riveted aluminium bodyshell with no welded joints. He adds that they were one of the first metro trains in the world to use regenerative electrical braking and are extremely energy efficient. As a result the brakes blocks are all in extremely good condition with TTC reporting that replacements are rarely required. “We purchased these trains with the view that they will last the entirety of our 25-year term,” Schabas says. “They are not likely to fail, or fall apart, but would require a midlife refurbishment to replace the usual things. We are starting to take delivery of the trains now and the abnormal track gauge in Toronto [1485mm] means that we are going to replace the bogies. We are still negotiating with potential companies which will carry out these upgrades, but GMI in the United States has dismantled and assessed two of the cars and they have found they that are in good condition. The nature of Toronto’s system means that they are very clean, there is no graffiti, and if you ride the train there you do not see any litter. We think we have got a very good deal for
IRJ June 2013
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