By Samuel Godspower
Friday, November 22, 2024
The Federal Government, through the Ministry of Works, has announced the termination of the N740 billion contract for the Abuja-Kaduna-Zaria-Kano road rehabilitation project awarded to Julius Berger Plc.
The termination, effective immediately, was outlined in a letter signed by C.O Assam, Director of Legal Services at the Federal Ministry of Works. The decision was made in line with Clause 63 of the Standard Condition of Contract (Road Works), Volume 1, 1999 Edition.
The project, which was approved for rescoping and review by the Federal Executive Council (FEC) in September 2024, was revised to a value of N740.8 billion, with an expected completion period of 14 months. It covered three sections of the road: Section I (127km), Section II (73.4km), and Section III (128km).
However, the Ministry stated that an independent consultant reviewed the project costs and revised the contract sum to N710.8 billion, a figure initially accepted by Julius Berger before the company rescinded its agreement, citing rising costs of construction materials.
According to the termination letter, Julius Berger’s refusal to provide unconditional acceptance of the revised contract sum within the stipulated seven-day period prompted the Ministry to act.
The letter also accused the company of deploying “delay tactics” that worsened the state of the road, causing significant hardship for commuters.
“Your alteration of the work items approved by FEC is viewed as a counteroffer and therefore unacceptable,” the letter read.
The Ministry confirmed its intention to take over the site and the remaining works from Julius Berger, with arrangements for joint measurement of completed work already underway.
The Federal Ministry of Works had earlier issued a letter dated October 23, 2024, requesting Julius Berger’s unconditional acceptance of the revised terms. The company, however, responded on October 29, reiterating its concerns about rising material costs.
The Ministry viewed this response as non-compliance and grounds for termination, noting that the decision was necessary to prevent further delays in delivering the project.
The Ministry emphasised that it reserves the right to pursue additional legal remedies under the contract terms. Meanwhile, efforts will be made to ensure the smooth takeover and continuation of the project to ease the challenges faced by road users.
