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Lagos’ massive new port needs more transport infrastructure to thrive

“As the port, free trade zone, Dangote Refinery and other major projects along that axis have reached advanced stages, you’d expect the transport infrastructure to also be ready by now. But that is not entirely the case,” Akolade Edunwale, principal consultant at Scudo Consult Limited, a Lagos-based real estate company, tells The Africa Report.

Nigeria has lost its regional maritime dominance to neighbouring Togo, Benin, and Ghana due to its port congestion and inefficiencies. Yet Africa’s largest economy seeks to regain its leading position when Lekki Deep Seaport kicks off operations.

Increasing GDP by 80%

Planned to be operational next March, the port is built on 90 hectares in the eastern part of Lagos, and will have a container terminal with a 1,200m long quay, three container berths, one dry bulk berth, three liquid berths, and a storage yard with over 15,000 ground slots, among other facilities.

The cost of fixed assets and construction works, which will be over before year’s end, amount to 1.53bn and $800mn, respectively.

The port is materialising through a special purpose vehicle, Lekki Port LFTZ Enterprise Limited (LPLEL). Investors are the Lekki Port Investment Holdings Inc – which includes China Harbour Engineering Company Ltd. (52.5%) and Tolaram Group (22.5%) – the Lagos State Government (20%), and the Federal Government of Nigeria (5%) through the Nigerian Ports Authority (NPA).

LPLEL will build and operate the port, which is situated inside the Lagos Trade Free Trade Zone, for 45 years. The federal government should take over afterwards.

The Lekki Deep Seaport should greatly revitalise Nigeria’s economy by facilitating trade, boosting manufacturing, and improving export.

When completed, it is estimated to add over $360bn to Nigeria’s GDP, which will in turn increase by more than 80%. The port is planned to create about 170,000 jobs and provide the government with over $200bn worth of revenue, and generate businesses of about $158bn.

But will the lack of port-to-city transport infrastructure diminishes its gains? And how well is the government trying to avoid a repeat of Apapa Port congestion?

Transport master plan

The traffic that will emanate from the Lekki Deep Seaport is huge, considering the volume of trade and goods it will facilitate.

The port’s container terminal is expected to support 2.7mn twenty-foot equivalent units (TEU) per annum, while the dry bulk terminal and liquid berth are designed to support four million metric tonnes and 45,000 DWT (deadweight tonnage) of cargo a year, respectively.

The project manager of Lekki Deep Seaport, Tejaswi A. Vanamali, tells The Africa Report that they carried out a detailed traffic impact assessment (TIA) study to ascertain the strength of the access roads before funding was secured for the construction of the port.

The planning took into consideration the existing traffic load on the major access road, Lekki-Epe expressway, and the forward-looking traffic projections “emanating out of all the major projects in Lekki such as Lekki Port, Lagos Free Zone, Dangote Fertiliser & Refinery Complex and Lekki Free Zone”.

Vanamali says it was subsequently established that the two-lane per direction road “would provide sufficient capacity to meet the traffic projections over the next 5-7 years”.

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The Lekki Deep Seaport transport master plan. Source: Tolaram.

The project manager explains that the first segment of the master plan, drawn by both the federal and state governments, includes an existing 27km road connecting Lekki-Epe Expressway with the Lekki Port and Lagos Free Zone projects.

The state government has already secured a 115m Right-of-Way “that can accommodate a six-lane dual carriageway and a dual rail corridor”.

The first phase of the concrete road is being handled by Dangote Group under the Federal Government Roads Infrastructure Tax Credit policy, a scheme that allows big private businesses to use the equivalent of their tax for a period to build approved roads.

The second segment, which is “a new 55km greenfield transport corridor (including provisions for a rail corridor) with a 110m ROW that will connect the Lekki Port-Lagos Free Zone area directly to the Sagamu-Benin Expressway…is currently under feasibility stage,” he says.

In line with president Buhari’s directive in 2020 that all seaports in the country must be connected to the railway, Vanamali says the federal transport ministry is working on “developing a rail connector between Lekki Port and Lagos-Calabar rail line”.

Challenges

Beyond the strength of the major access road is traffic congestion concerns. Nigeria’s current major port in Apapa Lagos is reputed for its congestion and delays.

In December 2020, Financial Times revealed that it cost almost the same amount ($4,000) to ship a container 12,000 nautical miles from China to the Lagos port and to truck it to the warehouses in Lagos, costing the country $55m daily in economic loss. This, the report said, is due to ageing infrastructure and poor transport network, among others.

“We expect a geometric explosion in terms of influx of people, businesses and investment. The port and the entire FTZ are built for production for local consumption and export,” Akolade says.

Unlike older highbrow areas for administrative business and exchange of commercial papers, such as the Victoria Island, he argues that the Lekki area will witness more volume and classes of people because actual large-scale manufacturing and production will take place there. “Land of about N1 million a few years ago, now sells for N20-35 million in the area,” he adds.

Poor access

Akolade argues that while the master plan is great, the fact that there is currently only one existing access road which isn’t even fully ready at this time is rather unfortunate.

But the Lagos State commissioner of information, Gbenga Omotoso, tells The Africa Report that the rehabilitation and expansion of the first phase of the Lekki-Epe expressway, which spans from the port to Eleko in Epe outskirt of Lagos, is done.

He explains that this means that cargoes meant for other states in the west, east or north of the country now need not to pass through inner Lagos to deliver their goods.

The rehabilitation of the other stretch of the road which facilitates the movement of Lagos-destined cargoes will soon be completed, he says.

In addition, he says the state government is already building the Regional Road. It will further facilitate vehicular and cargo movement on the Lagos island. It is also concluding plans to approve the concessionaire to build a 38km Fourth Mainland Bridge, which connect Lagos island, where the port is located, to Ikorodu outskirt on the Lagos mainland, another exit to other states.

Way forward

Inadequate port-to-city transport infrastructure may impact the huge benefits of the port or FTZ, says Shakirudeen Taiwo, an economist at the Nigerian Economic Summit Group (NESG), a private sector-led think-tank and policy advocacy group.

He tells The Africa Report that the zone as a whole has huge inter-sectoral benefits for the overall Nigerian economy and a multiplier effect in multiples of 230. He suggests that the port activities be automated in order to avoid delays and congestion.

He also suggests that an inter-governmental collaboration between federal and state governments to at least build an outbound rail line for cargo and inland dry ports along the line to other states. This will go a long way in decongesting the port and spreading economic growth across the country.

Lagos state government in early 2000s drew a master plan for rail transport in the state. In the plan, the state is supposed to build seven rail lines across the state for human and freight movement. Over 20 years later, the government is about to complete two, the blue and red lines, in the first quarter of next year.

A third one, the green line, is supposed to stretch from Lekki, where the FTZ and port are now situated, to Epe outskirt of Lagos. Perhaps it is time for the government to prioritise this.

“Once we are done with the blue and red lines, it is only natural and logical that we move to the green line because of the pace of development along the Lekki corridor,” Omotoso says.

He also assures that the government will deploy a digital call-up system for the truckers to avoid congestion by ensuring only trucks that need to be at the port at a particular time will be there. Truckers’ disorderliness was a major cause of congestion at Apapa Port but this has indeed been significantly reduced since the government introduced the Eto call-up app and embarked on road repairs.

“With all these plans, I do not see a repeat of Apapa,” he says.

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