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INVESTIGATION: Osun MKO Abiola Airport in ruins despite multi-billion naira funding, concession (1)
By Kemi Busari
“THIS is the airport. This is where you are going,” the motorcyclist, Folahan Joseph, said as we approached a bushy enclosure.
The dark patch of damp on the fence speaks audibly of neglect. The expanse of land spanning about 839 hectares is the site of an abandoned airport project at Ido-Osun in Egbedore Local Government Area of Osun State.
Eight months ago, Joseph heard what he said was one of the best news of his life. The state government, owing to the dearth of fund, had decided to concession the construction of the airport named after the multi-billionaire business mogul and widely acclaimed winner of the 1993 presidential election, the late Moshood Abiola.
“I was happy the day I saw them (the contractor and state officials) at the site,” the Mass Communication National Diploma holder said. “We thought they would work on it fast and some of us will get jobs there, but see what it is now. Nothing has been done.”
Joseph, like other residents of the state, was still that hopeful work would start on the site; until the Osun State governor, Rauf Aregbesola, suddenly announced that the concession had failed.
“Simply put, concessionaire of the proposed ‘MKO Abiola International Airport in Ido-Osun’ has failed,” Aregbesola declared during “Ogbeni Till Day Break,” an interactive session with the media and members of the public in May. Surprisingly, the announcement came the same month the airport was expected to take off.
For many years, since the administration of former Governor Olagunsoye Oyinlola, the completion of the project has eluded inhabitants of the community and the state at large.
But what could account for the failure of a project which has been awarded multiple times and for which the state government has expended billions?
Documents made available to this newspaper revealed that the expanse of land on which the airport was to be located had been acquired in 1936 for aircraft flight operations. Then, Nigeria’s Governor-General, Bernard Bourdillon, through the southern province, paid £103 and three shillings to the then Baale of Ido Osun and 15 farmers who sought compensation for the destruction of their crops for him to justifiably purchase and occupy the land as its new rightful owner.
After acquisition, an airstrip, which served as take-off and landing platform for the West African Frontier Force who fought alongside British Army during the Second World War, was constructed by the British Empire. It then commenced the designation of Ido-Osun as the first community where aviation activity took place in West Africa.
Several years after, efforts to turn the ground into an airport started with one of the state’s former governors, Olagunsoye Oyinlola, before his exit in 2010.
Oyinlola’s administration, in its attempt to construct a modern airport on the same expanse of land, acquired more land.
However, no meaningful work started until October 2012 under the current administration of Aregbesola.
The Osun State Ministry of Works did not reply to a Freedom of Information request for history and financial expenditure on the project.
The contract was first awarded to Aeronautics Engineering at the cost of N4.5 billion in October 2012. Sometime later, it was reviewed to N11 billion to accommodate more features.
Of this amount, the state government noted that it had spent N3.6 billion. Thereafter, the project got abandoned mid-way, prompting the need for a re-award.
In October 2017, the state government revived its intention to continue the project but having entered a huge financial constraint, the Aregbesola administration opted for concession.
The concession solution
In a concession agreement, the contract was awarded at N69 billion to a firm named All Works of Life (AWOL) International Limited. However, the company was to work with two partner companies named Biray Group, for the technical aspect, and Exim Bank of Turkey, where funds for the project was to be obtained.
But, generally, the pact was for AWOL to fund and construct the airport 100 percent. Also, the concession was to last for 30 years before permanent transfer of ownership would be made to the state government.
While the process runs, the Osun government would earn five percent of profits from land rent, taxes collected and receive other necessary dues before the transfer.
This new design was welcomed as a great improvement on the initial plan, hence the high increase in its upward reviewed cost.
AWOL, in the new agreement, would build an airport with cargo and hanger as the first of its kind in West Africa and third in Africa after South Africa and Egypt. The runway was also expanded from the initial 3.0 kilometres to 3.5 kilometres.
After the first eight months of work, the airport was expected to have an ultramodern commercial complex, terminal buildings, control tower, standard civil infrastructure, maintenance building and power house, staff training centre, fire-fighting station, security infrastructure, apron and taxiways and dual-carriage-road leading from Osogbo, the state capital, to the airport, among several other catchy attractions.
On its completion, the airport was to display an array of exquisite five-star hotels, Cultural Centre, Water Park, Recreation Centre and Garden, Butterfly Museum and Casinos within a period of two years, all in the bid to attract patronage.
With all that set, Aregbesola signed the agreement amid great joy and hope, given that in another eight months, the airport would take off with five aircraft, three passengers’ helicopters and one cargo aircraft by AWOL Int’l. That was the thought. That was the plan. That was the collective expectation.
All that hope, at best, only materialised in mounting of a signpost by AWOL.
On June 26 when this reporter first visited the project site, two security men working for AWOL were at the entrance. They told the reporter they would only grant entrance into the project site if the Chief Executive Officer (CEO) of the company, Nurudeen Ogunlade, gave permission. This was despite the termination of contract between AWOL and Osun State Government.
The state government had on March 5 issued a 21 days’ notice of termination of contract to AWOL. On expiry, another letter was written to the company on April 6 requesting the company to vacate the project site immediately. This was followed by a petition to the police on April 20. Yet, AWOL remained on site.
On another visit in company of the state Commissioner for Works, Kazeem Salami, on August 1, AWOL’s signpost and flags hoisted at the entrance of the site had been removed, suggesting the company finally vacated the site.
The 3.5 kilometres runway had been marked, dredged with drainage on each side covering up to 500 metres of the whole way. Many drain boxes waiting to be fixed lie at both sides of the runway for 500 metres.
The terminal and control tower is still abandoned but the six cross culverts on the runway have been completed and awaiting filling to raise to required altitude.
All these works, he noted, was done by Aeronautic Engineering, the company to which the contract was initially awarded.
Side-lining the State procurement law
To note that the concession started on a wrong foot, as there was no recourse to laid-down procurement rules, would not be quite off the mark. Visits to the Ministry of Works and the State Public Procurement Agency (PPA) showed that these agencies were not fully involved in the award of the contract.
Enacted in 2015, the Osun Public Procurement Law clearly defines the terms of award of contract for public goods and services.
While signing the bill into law, Aregbesola boasted of a new dawn in the state’s procurement policy when he declared, “Just today, Wednesday, February 10, 2016, a report in one of the newspapers compared the airport we are building in Osun to similar ones built by other states and concluded that ours is the cheapest, even when we have the longest runway. It is the need to have these values codified into law and make it bounding principles of governance for whoever is in government that motivated us to make this law.”
Investigations, however, revealed that, perhaps, the state government forgot about this promise in the process that led to the award of contract to AWOL.
For instance, the law stipulates the process of procurement implementation in Section 29 and allows only for a competitive bidding process of goods and services with monetary value above N50 million.
Under this arrangement, a procuring agency is expected to first advertise its contract tender in the national dailies and call for bids from interested parties. It will then receive and evaluate bids, communicate the evaluation to PPA, obtain approval from PPA, thereafter announce and publicise the award to the chosen contractor after due approval.
It is after completion of bidding process, AWOL or any winning contractor is expected to obtain a certificate of compliance from PPA upon which such contractor would proceed to commence work.
As the law clearly stipulates in Section 25(3), “The procuring entity shall award a procurement contract after the agency (PPA) has issued a certificate of compliance.”
None of these requirements, according to our findings, was fulfilled in the AWOL concession.
Investigations revealed that in the case of M. K. O. Int’l Airport, ‘No advertisement, no bid opening, evaluation or approval’ was carried out.
Rather, the state government bequeathed the contract to the favoured AWOL.
Investigations show that the contractor was sought among the circle of people close to the state government. It was further alleged that the contractor, having previously worked with some state government officials, sealed the deal behind closed-doors even before the public announcement; thus giving further credence to the allegations that basic procurement procedures were by-passed.
Confronted with these facts, the Director-General of PPA, Ayo Fatoberu, declined to offer any comments on the involvement or otherwise of the agency.
He simply told this reporter: “I don’t think I want to grant an interview on that aspect of the job.”
Moves were also made to clearly ascertain whether the state assembly approved the concession. But when prompted, House Chairman on Finance and Appropriation, Kamil Oyedele, rebuffed the reporter’s inquiries.
On his part, the state Information Commissioner, Adelani Baderinwa, justified the process on the peculiarity of the project and the state’s lack of funding capacity.
He said: “It wasn’t as if we had ready hands that wanted to do the job. So, if you find one that is interested… the peculiar situation of that particular projects warrants such. You are able to see somebody who is interested in it, you know how much that is going to be expended and it’s not going to be government’s money. On the basis of that, the concession agreement was done properly.”
Requests to obtain relevant documents, sent to AWOL’s partner company, Biray; and the Ministry of Works, were not responded to.
A civil servant privy to the processes, who asked not to be named for fear of victimization, said relevant agencies, especially the Ministry of Works, which is supposed to monitor the procurement process, were sidetracked from the onset.
“The state government was actually eager to complete the project. And that was why they entered the first agreement in 2012. But by the time they released the first, second and third payments, the contractor had run into trouble and that was the end,” she said.
“Later, the project was reviewed but there was no fund to execute it. That was why the government opted for concession. So, the state government set up a committee comprising three commissioners who were the ones that spoke with the AWOL team. They then came up with a two-paper agreement to build the airport.
“But in the whole process, I don’t think the Ministry of Works was carried along. And the contractor only presented the output but he didn’t give enough details on the technical specification for the project which is supposed to be the responsibility of the works ministry. But like I said, they were not in the know.
“I think the contractor later realised that project requires some technical expertise such as the expansion of runway which need to have an alignment and others. But because he didn’t have the technical know-how, that was why by the time they approached the works ministry, it was too late.”
Salami debunked the allegation saying the PPA as well as the ministry he oversees were carried along in the process.
“We are always the consultant to any job,” he replied to a question on the role of the ministry. “There were staff from the Public Procurement Agency too with Ministry of Works’ staff. We even set up project monitoring committee for supervision. AWOL said we should send five people to be responsible for the committee.
“Ordinarily, we should be in charge to supervise the job and make sure the job is done in accordance with design and specification. Our job is to make sure good jobs are delivered to the state government.”
Salami added that the firm which the contract was awarded to previously, Aeronautic Engineering, was also in charge of monitoring AWOL
“We have a consultant, Aeronautic Engineering, being paid by the state government to make sure all the jobs are done in accordance with ICAO or any regulation body. Apart from them, the JCT and PMC project monitoring committee,” he said.
Unqualified AWOL: A big scandal
Findings by this newspaper revealed that prior to October 2017 when the contract was awarded, no company that goes by the name AWOL International Limited, ever existed. It was also found that for the many months preceding the signing of the concession on October 26, 2017, the company had no documented registration with the Corporate Affairs Commission (CAC), Abuja, as required by procurement law.
To secure the contract, the only known face to AWOL, Nurudeen Ogunlade, Chief Executive Officer (CEO), registered the company on October 3, 2017, about twenty-three days to the time Aregbesola signed the concession agreement.
Ogunlade, self-made CEO of the company, also presented persons believed to be his family members, Ogunlade Akanbi and Ogunsola Hassan, as directors. Then, the three, and one Ogunlade Sifau, were listed as shareholders, records obtained from the CAC show.
The company has no record of previous construction works in Nigeria or any other country. And until October 2017, the company had no office, no aviation linkage, no website and no social media handles.
One of the journalists present during the concession agreement said Ogunlade, without a company, used to facilitate travels and tours for people; and so, he was surprised to see him engage in construction of an airport.
The journalist added that Ogunlade he knew, used to take people on tours and vacations abroad. “That was what we know him for,” the journalist stressed; “so, it was strange to people who are even close to him that he would handle an airport project,” he noted.
Even though the contract was awarded to AWOL, the company had close to nothing to do in its implementation; a factor that was further played up as evidence of its incompetence. This was also evident in the nature of the agreement as noted by a source.
In order to gain Aregbesola’s confidence, Ogunlade courted two partners to be involved in the project. They were Biray Group, a Turkish construction firm, which was deployed to front as a technical partner; while the Exim Bank of Turkey was presented as financial partner.
In spite of these permutations, AWOL was not able to deliver the first part of the project after expiration of eight-month agreement period.
Commenting on AWOL’s competence, Baderinwa, the information commissioner, said the company breached the trust of the state government in its proposal and contract agreement.
“Fortunately, we got a renewal of mandate in 2014 and the governor was still interested. So, he asked that people should scout for a project financing contractor to which it would be concessioned. The state government wanted a contractor that would be interested in staking its money into supporting the project from start-to-finish. That was how we were on it for quite some time until middle of last year when a concessionaire came in the name of AWOL.
“The governor got convinced that yes, probably the Messiah had come eventually. But, it is so unfortunate. What the man said he is, he is not. There were terms of agreement as to when the first phase of the agreement will be completed but the time passed and there was nothing done. He was still running around to source for money. So, the governor did not hesitate to terminate the contract.”
This investigation was supported by the John D. and Catherine T. MacArthur Foundation and the International Centre for Investigative Reporting (ICIR).