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Home Business News

FG awards 5 road contracts worth N309.9 billion to Dangote Group as tax credit

Chike Olisah by Chike Olisah
July 15, 2021
in Business News, Spotlight
Nigeria needs N1.5 trillion within the next 3 years to fix roads - Fashola
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The Federal Executive Council (FEC), on Wednesday, approved the award of road contracts to Dangote Industries at the cost of N309.9 billion.

The 5 road projects with a combined total length of 274.9 kilometres of federal roads under the Federal Government Road Infrastructure Tax Credit Policy will be handled by Dangote as tax credit.

This disclosure was made by the Minister of Works and Housing, Babatunde Fashola, during a briefing of State House correspondents on Wednesday in Abuja after the FEC meeting presided over by President Muhammadu Buhari.

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Fashola explained that the road contract, which was the second approved for his ministry by the council, would be implemented on concrete and would be the largest of such projects in the country.

READ: Dangote Cement incurs N97 billion taxes in 2020

What the Minister of Works and Housing said

Fashola said that this initiative by the Federal Government is also part of its multiple funding options with the private sector.

He said, “The second memorandum presented by the Ministry of Works and Housing was for the construction or the reconstruction, as the case may be, of five road projects in favour of Messrs. Dangote Industries Limited, totalling 274.9 kilometres of federal roads, under the Federal Government Roads Infrastructure Tax Credit policy, which is one of our strategic partnerships with the private sector.

Those five roads totalling 274.9 km will cost N309,917,717,251.35 to be advanced by the Dangote Industries as a tax credit.”

Going further, the Minister listed the roads to include Bama to Banki in Borno State for N51.02 billion running into 49.15km; Dikwa to Gamboru-Ngala, 49.58km, in Borno State for N55.5 billion; and the Nnamdi Azikiwe Road, popularly known as Western Bypass in Kaduna, 21.48km, from Command Junction to Kawu, in the sum of N37.56 billion.

READ: Aliko Dangote’s net worth falls by $1.4 billion in Q1 2021 amid stock market sell-off

Others are the deep seaport access road sections 1 and 3 in Lagos State, through Epe to Shagamu Expressway, 54.24 km, that links Lagos and Ogun states, in the sum of N85.84 billion; the Obele/Ilaro/Papalanto to Shagamu Road, 100km, in Ogun State, in the sum of N79.99 billion.

He also said, “Council considered and approved this memorandum, to facilitate the construction of 274km of concrete roads. So, this will be the largest single award of concrete roads ever undertaken by the government of Nigeria in one award.”

While speaking on the conditions surrounding the contract, Fashola said, “First of all, the award is consistent with our multiple funding options, which includes engagement with the private sector.

Secondly, the tax credit initiative was in existence in the last administration before this government but was not utilised. So, this administration has revised it, expanded it, and has used it to construct roads like the Apapa Wharf Road, the Oworonsoki to Apapa, through Oshodi Road, by the same Dangote Group.”

He said the list included the Obajana-Kabba Road (still the Dangote Group) and the Bodo-Bonny bridges and road, which council approved last week, through the NLNG.

The Minister further revealed that this initiative is not unique to Dangote as there is also interest from many other companies which are being reviewed.

What you should know

Similarly, it can be recalled that in April 2021, the Federal Inland Revenue Service (FIRS), announced the issuance of tax credit certificates valued at N22.321 billion to Dangote Industries.

The tax credit certificates were for the construction of Apapa-Oworonshoki-Ojota road in Lagos and the Lokoja-Obajana-Kabba road that goes through Kogi and Kwara States.

The issuance of tax credit certificates followed the signing of Executive Order 07 of 2019 by President Muhammadu Buhari, which is on road infrastructure tax credit.

The order encourages companies to develop infrastructure around their operational area as long as it will enhance their delivery and their businesses.

Under the Credit Tax Scheme, participating companies are to recover the cost incurred by them in the construction or refurbishment of eligible roads as credit against Companies Income Tax (CIT) payable.


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Tags: Dangote Industries LtdDangote tax credit
Chike Olisah

Chike Olisah

Chike was a banker with over 11 years experience in retail and commercial banking, risk management, treasury portfolio management and relationship management. He also acquired some experience in financial management and do have some special interest in investment analysis and personal finance. He had stints with financial institutions like the former Intercontinental Bank and Fidelity Bank.

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Comments 31

  1. Jude iyibu says:
    July 15, 2021 at 9:39 am

    How come none of these roads runs in the eastern regions, south south and Delta regions, north east or middle belt? When it’s national tax exemption for building. new roads in borno when the population have ran away from chronic violence to other parts of the country? . Who will be using these borno roads with boko haram running the show up there? good to see innovative funding in action and thank God for our brother Dangote

    Reply
    • ABEO says:
      July 15, 2021 at 1:46 pm

      sir, pls check other projects before this under the same tax credit scheme being done by transcorp, mtn nigeria, nlng, bua, dangote etc

      Reply
    • Demmy says:
      July 15, 2021 at 8:52 pm

      “The order encourages companies to develop infrastructure around their operational area as long as it will enhance their delivery and their businesses”

      Reply
    • Anonymous says:
      July 15, 2021 at 8:56 pm

      Biafra

      Reply
    • Bara says:
      July 15, 2021 at 10:24 pm

      Jealousy will kill you prematurely.

      Reply
    • Abubakar Yusuf says:
      July 16, 2021 at 6:30 am

      How durable is this concrete road and also when is the project commencing?
      Is the project for the Kaduna bye pass mentioned not a duplication of contract award?

      Reply
      • Ifeanyi E. says:
        July 16, 2021 at 10:01 am

        No it’s not, the Abuja – Kano project will go through the Eastern byepass

        Reply
  2. Baby Ayo says:
    July 15, 2021 at 12:48 pm

    This country will find it difficult to progress. It is sad federal government plays regional politic in all things. What a primitive ways to address our road problems and what people have been complaining about.

    Seriously, I don’t admire our leaders for once or for anything.

    It is time we look for people with great foresight to move this country forward. Over 60 years we are still not focused on progress but spites and marginalisation.

    It is disturbing to see our leaders acting this way. Borno is a state where insecurity is rife. The roads are going to be less utilized to full capacity as you would expect in other parts of the nation.

    Reply
    • Anonymous says:
      July 17, 2021 at 7:00 am

      My dear that is why restructuring is inportant

      Reply
  3. Mukhtar Bukar says:
    July 15, 2021 at 3:02 pm

    You people have a myopic mentality that’s why the more you look the less you see. Just a fish inside pond. Please go round the country before you talk.

    Reply
    • SALBIZ SALTECHSALBIZ says:
      July 15, 2021 at 5:10 pm

      Some people are quick to react to issues unnecessary without taking time to view the information been passed across. All these projects are in the public space but because of sentiments and bias mind they refused to seek for the accurate information rather they will be misleading Nigerians

      Reply
      • Anonymous says:
        July 15, 2021 at 9:08 pm

        What are you insinuating? You that claims to know better. Are you saying that the roads around South-South and Delta regions are better of than the Northeast?. Let’s not talk about Southeast bcos you and I know that they don’t follow. But in all sincerity, can you justify the kind of sectionalism that this govt exhibits.

        Reply
    • Anonymous says:
      July 15, 2021 at 5:52 pm

      Have gone to the south of recent?

      Reply
  4. Ayuba abubakar wudiri says:
    July 15, 2021 at 9:18 pm

    Please mr president how about our road we want to know weather where not in Nigeria, mr president don’t forget we vote you Gombe Biu link to Adamawa road,
    THANK YOU

    BEST REGARDS
    Ayuba abubakar wudiri

    Reply
  5. Anonymous says:
    July 15, 2021 at 9:40 pm

    What of the abandoned federal road project in ile ife.

    Reply
  6. Anonymous says:
    July 15, 2021 at 10:19 pm

    If you go to south east you will know the roads there are very bad, so why, the government has forgotten that region and not from there but I pity the east they are excluded big time for everything, I hope the east leaders will cooperate with one voice

    Reply
  7. Alamu Oladele says:
    July 16, 2021 at 2:37 am

    How come there is no one in eastern part? Hence, all the interstate roads in south west are bad. You are from southwest do something good before your time runs out. Remember, Gen Obasanjo commenced Ibadan/Ilorin Express way, and couldn’t complete in the whole of the 16 years PDP rule. Is very ???. Look at what we are facing today. Kisi / New Bussa / Kanji road is there, you didn’t do anything in that area, also an expreess road from Abeokuta to Kisi to the North. Do good for your people. You won’t be there tomorrow.

    Reply
    • Cy.com. says:
      July 22, 2021 at 12:10 pm

      It’s high time we begin to criticize constructively,
      Federal govt can’t spread same type of development across the nation . We have people in house reps, who claims they are our voices. They at one time or the other present priorities of their people to the floor , and send for assent.
      It not every community that needs road as their priorities at the same time with another.

      Reply
  8. Abubakar zubairu alkali says:
    July 16, 2021 at 6:05 am

    Please fg help us in taraba to get something good to see as we are Nigerian too we don’t have anything

    Reply
  9. Anonymous says:
    July 16, 2021 at 6:47 am

    This is just a mess!
    Our government has monopolised the economic activities in the country by subletting businesses into the hand of only one man and granting him soft landing in all spheres. This project in question is a means of transporting his refined oil product from Eleko through Epe to Sagamu express and from Maiduguri to other African countries!
    Continue trading with the interest of Nigerian Citizens!

    Reply
  10. Owo says:
    July 16, 2021 at 9:19 am

    Mr. President sir. Please remember to build the Lagos-Abeokuta Express Way. The road is totally destroyed. It is in a complete state of ruin and catastrophe. Please send a team of secret inspectors to the area to confirm it sir.

    Reply
  11. Anonymous says:
    July 16, 2021 at 11:12 am

    How did they arrive at these figures ? Over 1billion Naira per Kilometer of road … Irrespective of the soil texture .This is highly inflated.

    Reply
  12. Prince Akinleye Daniel Akinyemi says:
    July 16, 2021 at 11:18 am

    Good day to all the protocols members of development now as I may tag my topic, to be holistic it’s a good idea and great step towards see government at there best, if this are earlier done in the beginning, Nigeria would’ve been named and not expected as a developing nation, our past hero had all been selflessness and acted self centered, embezzlement and forcefully enrich themselves, this’s a good step and a good direction in the parts of our present managers, a lots is still expected of you,I Prayed if Sango,Owode Idiroko road could be given upmost support for growth infrastructure I plead, God Bless Nigeria.
    Thanking your management for further progressive and change “Apc”

    Reply
  13. fella says:
    July 16, 2021 at 2:12 pm

    Must you guys brings ethnicity to national affair, please go and read the Presidential executives order before ranting here.

    Reply
  14. Awile Babatunde says:
    July 16, 2021 at 2:34 pm

    They should know that Lagos state is quite different from other states

    Reply
  15. Anonymous says:
    July 16, 2021 at 2:49 pm

    Nobody talks about Benin Sapele Road. Go and see the hold up and the amount of trailer falling on a daily base

    Reply
  16. Andy Sam says:
    July 16, 2021 at 8:44 pm

    I sincerely weep for the South South. FG is embarking on 5 road construction project and they are sharing it to their zones not even a half is given to the South South.are the roads in South South too good?. Every year people are crying for the road linking Calabar-Ikot Ekpene-Aba but no answer and we are in the same country.God is watching us.

    Reply
  17. Vince Madu says:
    July 17, 2021 at 3:36 am

    The problem here is Nigerians for allowing these fools to kill Nigeria. A 274.9 kilometres road for NGN 305.9B.and people are here commenting rubbish, it means that to construct a kilometer of road cost 1,113,138,686.1314 and above. Which way Nigeria to construct a kilometer of road in Nigeria. Fashola and Buhari thank you.

    Reply
  18. Christian says:
    July 17, 2021 at 6:57 am

    Wha aret u people thinking about benue state,for example, aliede raod,ankpa ,branch.otukpo, what about 9th mile enugu to ankpa branch is an eye sow, go to obigbo in portharcurt to aba that is a death trap,then from akwa ibom to Calabar is not motorable any more,what revenue borno state bring to Nigeria,

    Reply
  19. Anonymous says:
    July 17, 2021 at 1:39 pm

    FGN should please concession Lagos Ibadan Expressway, Abuja Kaduna Expressway and other high traffic highways to banks in Nigeria to finance their expansion to minimum of 4lanes. The lenders toll the highway and install necessary security and infrastructural facilities on the highways. By this life’s of Nigerians playing these roads will be more safer

    Reply
  20. Mr. Isaac Ekoh Ogbodim says:
    November 7, 2021 at 2:48 am

    God will continue to guide and compliment the efforts of Alhaji Aliko Dangote in transforming the economy of Nigeria and Africa at large.

    Reply

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