AfDB Backs Lekki Port Construction

The Board of Directors of the African Development Bank Group (AfDB) held its first regular meeting since the Bank returned to its statutory headquarters in Abidjan on Monday, September 8, and approved a combined USD 256 million for the financing of investments in Nigeria and Ethiopia as well as a multinational projects preparation facility. The biggest investment approved is a USD 150 million senior loan to Lekki Port LFTZ Enterprise for the construction of a Greenfield seaport in the Lagos Free Trade Zone, 60 kilometres east of Lagos.

The project follows a 45-year concession granted to Lekki Port LFTZ Enterprise (LPLE), the Special Purpose Vehicle, by the Nigerian Ports Authority (NPA) under a build, own, operate and transfer scheme.

It involves construction of port infrastructure such as breakwaters, quays, approach channels, dredging of the basin as well as captive utilities such as water and power. On completion, the port would handle 2.5 million 20-foot equivalent units (TEUs), 16.7 million tonnes (MT) of liquid cargo and 4.5 MT of dry bulk. Construction is expected to start in January 2015 with the container terminal operations expected to start in December 2018.

The project, estimated at USD 1.675 billion, will be financed through a 54/46 debt to equity ratio

It is aligned with the Bank’s Nigeria Country Strategy Paper 2012-2016 which stresses infrastructure development in the non-oil and transport sector as well as the country’s Vision 2020, which emphasizes modernizing infrastructure.

The project is also in line with the Bank’s Regional Integration Strategy Paper (RISP) for West Africa which emphasizes linking regional markets through regional transport infrastructure.