PPP Revives Nigeria Airport (Storyline).

1. PPP Revives Nigeria Airport (Storyline)
The domestic terminal of Muritala Muhammed Airport in Nigeria(MMA2) was built in the
pre-independent years, before the construction of the international terminal for international and
regional fights.
The domestic airport was gutted by fire in 2000, which led the Federal Government to make a
decision to re- develop the airport using a Public Private Partnership Scheme (B.O.T).
In 2003, the Federal Ministry of Aviation advertised for bids for the project, and after an
evaluation process, Royal Standerton Ventures Limited emerged as the preferred bidder, while
Bi Courtney Limited was the reserved bidder. Royal Standerton was awarded the contract.
However, six months into the implementation phase, with no significant construction activities
on ground, the government decided to revoke the contract signed with Standerton
After necessary negotiations, the contract was awarded to Bi Courtney, the reserved bidder. The
contract duration was initially for 12 years, and subsequently extended to 36 years through an
addendum signed between the Federal Airports Authority of Nigeria (FAAN) and Bi Courtney.
B. Courtney Ltd, the Parent Company of B Courtney Aviation services, was awarded the
Concession in 2003 by the Federal Government.
The project encountered serious challenge of finance, because such huge BOT project with long
repayment plans was not fashionable in Nigeria.
The company proceeded with the project with initial financial support from Oceanic Bank
International. In 2007 six other banks, Zenith Bank Plc, GT Bank Plc, First Bank Plc, First City
Monument Bank and Access Bank formed a consortium to finance of the completion of the
project. The terminal was competed in 2007 and had since begun operation.

2. Terminal operations at the MMA2 commenced in 2007, with scheduled domestic flight
operations by Nigerian airlines. Since commencement, the contract has gone through a number
of challenges and disputes, including legal actions by the parties, with direct impact on the
performance of the concessionaire. Among the challenges and disputes are;
(1)Reluctance by some airlines to move from the International Terminal to the MMA2, where
they operated scheduled domestic flights.
(2)Resumption of terminal operations at the General Aviation Terminal (GAT) by FAAN,
allowing some airlines to operate a few meters away from the MMA2, affecting the airline
customer base at the MMA2.
(3) Legal actions by both parties on breach of contractual rights affected investor’s confidence.
(4) Terminal operations have been maintained, irrespective of the challenges and disputes, and
some airlines have continued to operate scheduled flights from the MMA
The lesson learnt from this include the need to have an agreed financial model and long term
financing arrangement from the beginning of the project ,the need to have multiple political
champions in support of the project and effectively managing their expectations .
Also revoking contract and re-awarding it to a different company delayed the project
implementation and affected the confidence of parties involved in the concession.
Also the conflict of interest between Government and the private sponsor put significant
pressures on the ability of the company to recover its investment.
However it is worthy to appreciate the impact of PPP in helping to promote infrastructure
development in the Aviation sector of the Nigeria economy .The Airport was the first to be built
through PPP without external source of finance, though there is the need to secure external
finance in future projects .The storyline of this project has been quite successful.
Thank You