The Federal Government has responded to the recent controversy regarding the Memorandum of Understanding (MoU) it entered into with Messrs MPH Rail Development Limited, a United Kingdom (UK) firm, for the construction of the Port Harcourt–Enugu–Calabar–Abuja Standard Gauge Rail Line.
The MoU, signed by the Ministry of Transport on March 13, 2024, has drawn attention and criticism from some Nigerians, particularly on social media, regarding the UK firm’s capacity to deliver the project, given its perceived newness in the rail construction industry.
Critics, including former presidential aide Tolu Ogunlesi, highlighted the existing Warri—Itakpe Standard Gauge Rail, suggesting that the route be extended from Warri to Port Harcourt and from Itakpe to Abuja to create the Port Harcourt—Abuja Standard Gauge Rail.
In response, Minister of Transportation, Sa’idu Ahmed Alkali, clarified in a statement issued on Sunday by Olujimi Oyetomi, Director of Press and Public Relations of the Ministry, that the initiative is still at a preliminary stage.
Alkali explained, “For clarity, a Memorandum of Understanding or MoU is a non-binding agreement that states each party’s intentions to take actions, conduct a business transaction, or form a new relationship. It is not a legally binding agreement.”
He further elaborated that the MoU stemmed from an unsolicited proposal presented by the British African Business Alliance (BABA), an association based in the UK with interests in African businesses.
The proposal, initially submitted to the ministry on August 27, 2019, includes the initiative to achieve 100% private sector funding for the project without loans or debt to the Nigerian government or any of its agencies, as stated in Article 3.3 of the MoU.
Alkali also highlighted the impact of COVID-19 on the delay between the initial proposal and the issuance of the Infrastructure Concession and Regulatory Commission’s (ICRC) Outline Business Case (OBC) Certification, which was granted on December 27, 2023.
The Minister emphasized that the MoU provides a platform for further agreement, discussion, scrutiny, and the provision of required guarantees by the parties to reach an agreement if they are satisfied.
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