Abuja – April 30, 2024 – Viewpoint Housing News.
The federal government’s offer of Julius Berger Plc an additional N20 billion augmentation fee may have settled their dispute on the suspension of construction on the N200 billion Bodo-Bonny Road in Rivers State.
Last Thursday, Dave Umahi, the Minister of Works, threatened to sever Julius Berger’s contract with the federal government if the company did not return to the site in 14 days.
After meeting with Umahi, the company’s managing director, Dr. Lars Richter, in a statement confirmed that, they were given an additional N20 billion augmentation fee.
According to the statement, they “have both committed to ensuring the critical Bodo-Bonny Road project is completed by year end.”
According to the statement, this is happening at the same time that the minister proposed paying the contractor an extra N20 billion in augmentation fees to help offset the consequences of the nation’s current economic realities.
“Umahi, who believed that no augmentation was necessary, hoped that the N20 billion that he announced at that time would lessen the contractor’s burden on the project.”
As per the release, the minister emphasised to the involved parties the significance of the project for the nation and the neighboring people.
He assured the Bonny Kingdom that the project would be finished by the end of 2024, he also stated that, the road will improve development when it was finished.
Richter said that the cost of the necessary building materials had increased by more than 1000% since the contract was awarded in 2014, when the exchange rate was N305 to the dollar. Richter brought this to the minister’s attention.
He demanded that the contract be altered, arguing that it is now essential given the country’s growing building material costs and the Naira’s decreasing value.
“I appreciate everyone’s attendance and providing me with this chance to shed further light on the project. Permit me to share with you our perspective on this project.
“This project was initiated in 2013 and today we are talking of 2024, which means the project is more than 11 years old. In 2014, we received the letter of award and the project couldn’t commerce.
“Then in 2017/2018, the NLNG stepped in with the infrastructure tax credit scheme for modalities in funding the project.”
He said the company asked for the augmentation because as at the time the contract was drafted it was based on the exchange rate of N305.
