FG Signs N11bn Concession Agreement For Tincan Water System
The Federal Government through the Nigerian Ports Authority (NPA) has handed over the Tincan Island Water System facilities to Sandust Tincan Water Project Limited after it signed a 16-year concession agreement with the firm valued at N11bn.
The NPA disclosed that the concessionaire would use this year to rebuild and rehabilitate the facility before the agreement would officially kick off on September 1, 2025.
Speaking during the handling-over ceremony at Tincan Island Port Complex on Monday, the Managing Director of NPA, Dr Abubakar Dantsoho, explained that the concession agreement was born out of necessity adding that most of the water treatment plants at the ports have gone moribund for decades.
Dantsoho who was represented at the event by an Assistant General Manager with NPA, Mukhtar Isah, stated that by allowing the facilities to continue staying idle, without any value addition the NPA and the government would lose a huge sum of revenue.
According to him, most vessels that visit Nigerian waters always look for fresh water to replenish their stock.
“And in most cases, they always call from outside for other parties to bring in water which often times are not enough for them. So the NPA now capitalised on the national policy on a public-private partnership to structure a concession like a sort of management contract that would outsource an operator that would manage and maintain the plant for efficiency,” he said.
The NPA boss stated that the process went up to the Infrastructure Concession Regulatory Commission and Federal Executive Council which got approval for the concession for 16 years.
“Now there are obligations on the part of the concessionaires and also on the part of the government. The concessionaire has met all its conditions and it was as a result of that that we now approve this date as the effect date of the concession agreement.
“So part of the responsibilities of the concessionaire was to transform the water treatment plant, rehabilitate it maintain it, bring in more equipment, and produce water for sale to vessels which would lead to earning income in dollars,” Dantsoho stated.
He said the NPA on its part is supposed to provide a level playing field for the operators to operate stressing that the government would be able to make the revenue in dollars.
“What I mean by a level playing field is that the policies of the government should be friendly to the operators not only in Tincan but also in Apapa Port and that all the things required by the concessionaires that the government through the NPA should be able to provide them,” the NPA boss added.
Dantsoho maintained that when the concession takes full effect a lot of vessels would be coming, “some may even come because of water alone, they will come and go which means the government would earn huge revenue,”
Earlier, the Managing Director and Chief Executive Officer of Sandust Tincan Water Project Limited, Mrs. Angela Attah, said that the concession which is for 16 years is valued at N11bn.
She added that the company is targeting 100 cubic meters of water per hour.
“The concession is a 16-year agreement between the Nigerian Ports Authority and the Sandust Tincan Water Project Limited the project cost right now is about N11bn and some of the money would come through equity and all that and that is the reason we brought different financing parties here that we are talking with,” Attah.
While acknowledging that the company is in good discussions with the financial bodies, Attah however, said that they are yet to sign an agreement with any of the financial bodies
“We are in a very good discussion with IFC, and Stanbic Infrastructure Fund among others but we haven’t signed anything with any of them yet we are in advanced talks with them and they are here which shows that they have interest.
“There is an obligation that NPA has to supply water to all visiting vessels and all port users and at the moment, NPA has not been able to deliver on that obligation because for more than 18 years the plant has not been active,” she said.
She maintained that the partnership will help the NPA ensure the supply of clean water to the vessels and others at the port.
“The only reason we have independent black market suppliers is because the NPA has not met their obligations and there is a requirement and also, there is a demand. What has happened so far is that the local suppliers have used barges to bring untreated water here and the fact is that they need treated water, they need fresh water and they need portable water,” she said.
According to her, while the independent black market suppliers were able to bring untreated water that is not the requirement for the vessels, there would still be a market for water, “because we know that water is a critical resource that we all require it is just that the market would shift, independent water black market supplies would lose market because the people want water they would come and get fresh water,”
“The fact is that the black market water suppliers have met a need that was there. So we won’t come on day one and throw them out. I think we would want to discuss with them, dialogue with them and see how, if they want water from us that is also possible,” she concluded.
