A Practical Guide to Mastering Very Large Government Projects

Jimoh Ibrahim · Christoph Loch Kishore Sengupta

## How Megaprojects Are Damaging Nigeria and How to Fix It

Jimoh Ibrahim • Christoph Loch Kishore Sengupta

# How Megaprojects Are Damaging Nigeria and How to Fix It

A Practical Guide to Mastering Very Large Government Projects

Jimoh Ibrahim Cambridge Judge Business School University of Cambridge Cambridge, UK

Kishore Sengupta Cambridge Judge Business School University of Cambridge Cambridge, UK

Christoph Loch Cambridge Judge Business School University of Cambridge Cambridge, UK

ISBN 978-3-030-96473-3 ISBN 978-3-030-96474-0 (eBook) https://doi.org/10.1007/978-3-030-96474-0

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## **Preface**

Tis book builds on the unpublished Business Doctorate Tesis by the frst author at the University of Cambridge Judge Business School. It is the frst thesis submitted for the award of the innovative new degree of the Doctor of Business at Cambridge Judge.

Te investigation is motivated by the sincere wish to help the frst author's country (Nigeria) improve its public investment eforts to beneft its population. Te collaboration between the authors has been enjoyable and fruitful, and every participant has learned about the beneft of careful data analysis that distinguishes between superfcial similarities and true causality, about the intractability of projects being embedded in dysfunctional power structures, and about the culture of a large and vibrant country. It has been a privilege to have the opportunity to work together on a project of such importance. Te authors sincerely hope that the publication of this book will somehow trigger positive changes.

Unfortunately, the performance of very large projects in Nigeria is unsatisfactory (to say it politely). Te very large scale of abandoned projects in Nigeria, recording well over 11,000 at the last count, is daunting. On the other hand, Nigeria *has* completed very large government projects since its independence in 1960. It is not that the capability of carrying out large projects does not exist. Our study implies that there is a failure of governance that needs to be addressed at the highest level of government.

Tis is the frst book on government mega projects in Nigeria, which has collected a unique data set to examine the projects. We sincerely hope that policymakers will fnd this a helpful book on what to do. We hope that stakeholders of very large government projects might see in the book an exciting road map for engagement. We hope that students of large government projects will have a book to learn from, the frst one on the very large government project management profession in Nigeria (and maybe the wider Africa). We hope that scholars within and outside Nigeria will fnd the data discussed in this book helpful and will use it as comparative empirical evidence for additional projects. Finally, we trust that readers will have the most exciting time and value of engaging with the book. Tank you for reading. Good luck.

December 2021

Cambridge, UK Jimoh Ibrahim Christoph Loch Kishore Sengupta

# **Contents**








# **About the Authors**

**Jimoh Ibrahim** is a prominent businessman in Nigeria, with business interests in hotels, insurance, banking, oil and gas, real estate and airlines. He is also completing his Business Doctorate degree at the University of Cambridge Judge Business School. He holds a Bachelor's degree in law and a Master of Public Administration from the Obafemi Awolowo University Ile Ife, Nigeria, in addition to a Master of Science in Mega Project Management

from the University of Oxford Said Business School and a Master of Business Administration from the University of Cambridge. He is also an alumnus of the Harvard Law School and holds other degrees.

In the public sector, he was, in 2005, appointed as the Honorary Consul of the Democratic Republic of Sao Tome and Principe to the Federal Republic of Nigeria for life in 2007. He was appointed by the President of the Federal Republic of Nigeria as the Chairman of the Board of Directors of the Nigeria Corporate Afairs Commission (equivalent of the British Company House). In addition, the president of Nigeria conferred on him the higher National Honours of "Ofcer of the order of the Federal Republic" (OFR) and "Commander of the Order of Federal Republic" (CFR) (the equivalent of the British Knight Commander of the Most Excellent Order of the British Empire, CBE). He is working on establishing a new University in Nigeria.

**Christoph Loch** is Professor of Operations and Technology Management at the Cambridge Judge Business School. He served as the Dean of the school from 2011 to 2021, in which period the school grew from £25M to £60M in annual revenues and rose in *Financial Times* rankings into the global top 20. He is globally known for research on innovation, operations management and project management, and he has received a research award from the Project Management Institute (PMI). He is a well-known speaker and instructor on innovation and on project manage-

ment. He has written a previous book on project management in addition to books on innovation and management quality in manufacturing.

**Kishore Sengupta** is Professor of Operations and Technology Management at the Cambridge Judge Business School. He is an internationally known researcher on project management, and he is the programme director of the project management executive education ofering at the Cambridge Judge Business School.

# **List of Figures**



# **List of Tables**



# **1**

# **Introduction: The Project Abandonment Problem**

Nigeria, a former British colony, had no name until 1914; the Nigeria of today consisted of diverse ethnic groups scattered across what is the country's current geographical space. Te ethnic groups were not united within a single country or empire in pre-colonial days. In July 1899 the British House of Commons ofcially approved the name after an article suggesting various names for the country was published in the *London Times*. Floral Louise, the British journalist who wrote the report, suggested the name Nigeria. In 1914 Nigeria's name was ofcially adopted for an amalgamation of northern and southern protectorates.

Te British colonial master attempted to foster civilization and development to ensure the success of the colonial period and a sustainable post-colonial period. It initiated several large government projects, none of which was abandoned during the colonial period until Nigeria's independence in 1960.

Large government projects constructed at this time positively remind us of the colonial period when we see or use their outcomes almost 60 years later. One example (of many) is the Carter Bridge in Lagos, enabling economic activities since the end of the colonial period.

On 1 October 1960 Nigeria achieved independence, and the British handed the country over to democratically elected civilians. Tere has been concern about stability and economic development ever since, for political, fnancial and sociocultural reasons. One example is the currency, the Nigerian naira, which was powerful at independence, at an exchange rate of 1 British pound to 0.8 Nigerian naira. At the time of writing this book, the exchange rate of 1 British pound to the Nigerian naira is 600 times higher than it was in 1960.

Te current investigation is not aimed at the broad issues of Nigerian economic development. Tis investigation focuses on the needs of the growing population for infrastructure to achieve economic development: roads, bridges, airports, power generation and transmission, hospitals, telecommunications networks and so on. Governments in countries like Nigeria are responsible for providing (or enabling the provision of) such infrastructure. Governments that do not provide these infrastructures limit economic and social development. Te ability of successive Nigerian governments to successfully deliver infrastructure development projects has been poor. Tis investigation asks why this is the case and seeks to ofer recommendations to improve this situation.

Te problem is not even that some of these large projects (with budgets of hundreds of millions, or even billions, of US\$) were not commercially successful. It is that many of these projects were abandoned before completion, leaving husks of half-fnished building structures dotted around the cities and countryside. In 2011 President Goodluck Jonathan set up the Presidential Abandoned Projects Audit Commission. Te commission visited all 36 states of the Nigerian Federation (including the federal capital territory) and identifed the number of contracts/projects owned by the Federal Government of Nigeria that had been abandoned. Te committee report identifed a shocking fgure of 11,886 federal out of (an estimated) 19,000 governmentowned projects that had been abandoned across the majority of the 36 states of the federation since 1970. Tis represents an abandonment rate of 63% or almost two-thirds (Abimbola, 2015).

It is challenging anywhere to ensure that very large (or "mega") projects are successful. For example, a study by Flyvbjerg and Sunstein (2016) concluded that very large projects sufer from average cost overruns of 40% (an average that has been roughly confrmed in other studies, for example, by Endut et al. [2005] in Tailand) and a beneft underperformance of 10% on average, caused by the "malevolent hiding hand" of complexity and interest conficts, which greatly hinder transparent management. However, a ratio of 63% of abandoned projects in Nigeria is much worse than the general project management challenges reported elsewhere.

Te issue is related not just to benefts (or lack thereof) delivered to the economy but also to costs. Large government projects account for a signifcant part of the world's GDP. Public sector investment amounts to an estimated \$9T per year, or approximately 8% of the global gross domestic product (GDP) (Flyvbjerg, 2014). For example, in the UK spending on programmes was recorded at £420 billion in 2013. In contrast, Nigeria has no data on what has been spent on successful or unsuccessful large government projects between independence in 1960 and today. However, the sums are huge—the 38 projects alone that this investigation considers in detail represent a total budget of over \$25B, almost equalling Nigeria's total foreign debt (\$27B) in 2017.

Te cost overruns and beneft shortfalls of major projects really do matter in Nigeria. For instance, foreign direct investment declined from \$8.8B in 2011 to \$3.3B in 2019, the current account balance deteriorated from \$10.6B in 2011 to −17B in 2019 (related to falling oil prices) and infation stayed at around 11% in both years, while unemployment deteriorated drastically from 4% to over 8% between 2015 and 2017. Over 40% of the 186 million citizens live on less than \$1 a day, and while the population grew by 2.6%, the economy only grew by 2.2% in 2019 (Jimoh, 2017).

Public debt increased from 17% of GDP in 2011 to 29% in 2019; foreign debt increased from \$21B to \$55B in the same period. While this level of indebtedness looks reasonable, the debts consume a large part of the Nigerian annual budget that is highly dependent on oil: the external loan serving ratio is already over 30% of the annual budget, which ran at \$23.4B in 2019. With recurrent expenditure consuming more than 50% of this budget, less than 20% of the budget remains for investments and capital expenditure. In this context abandoning 63% of large projects with budgets of hundreds of millions of dollars matters a great deal—it essentially negates the government's ability to improve infrastructure, and thus, it destroys the ability of the country to make its economy more productive and increase its citizens' wealth.

Te central question of this book is: Why does Nigeria have such an abysmal performance in delivering large government projects? And what could be done to improve this performance? Of course, there already exist several studies on government management of large projects (albeit centred mostly on empirical evidence from developed countries). Very large projects are complex dynamic systems, where several causal factors interact in non-trivial ways; moreover, these factors change over time, for example, with the surrounding economic situation and stakeholder needs, but also as the project itself matures and the causal factors wax, wane and morph. Te professional project management community has examined the success factors of mega projects for 50 years and "knows" what should be done. Te challenge is that what should be done is complicated, involves many interacting variables (the framework later in this book includes around a hundred), changes over time, and requires the discipline and alignment of many actors (with frequently diverging interests) behind common goals.

What constitutes the most important success drivers is not the same across countries and economic environments. In Germany or the UK the challenge might be not underestimating the uncertainty introduced into the complex project by ambitious new technologies (e.g. a key problem in London's Crossrail project turned out to the combination of trains and a new signalling technology) or the confict between competing stakeholders (e.g. one reason for catastrophic delays in the new Berlin airport was the division of the project into pieces given to diferent contractors driven by difering political interests, which caused incompatibilities). But what are the most important reasons for the failures in Nigeria? Te answer cannot be found in studies from other countries, because the political ecosystems in which Nigerian projects must succeed are unique to Nigeria. Previous project management knowledge has identifed a "universe" of possible success drivers (and failure reasons), but the question of which failure drivers truly matter in Nigeria has to be answered with Nigerian data.

Unfortunately, the Nigerian data is not available. When we began the research for this study, our colleagues suggested, "If the Presidential Abandoned Projects Audit Commission identifed 19,000 projects, of which 63% failed, why don't you get the database and systematically analyse what difered between the abandoned projects and the completed ones?" Te answer is that the commission did not put the data together; it did not even name all the 19,000 projects. Tere is no database or reliable data from other electronic sources (such as newspapers and magazines)—just a handful of individual and unconnected case studies.

Terefore, this book collects quantitative, as well as qualitative, data, in order to understand the Nigerian context, and it develops recommendations for the government that are applicable and actionable. Te study proceeds as follows.

Chapter 2 reviews the existing professional knowledge of the last 50 years. Tis body of work has identifed hundreds of variables (mega projects are complicated beasts!) and has pointed out that large projects are complex systems, where many of these variables interact in terms of their efects on success. Our analysis of this work culminates in a 50-construct framework (each of which may need multiple measures to be quantifed), on which we base the construction of the customized questionnaire described in the next chapter.

Chapter 3 describes our research methodology: in order to approach the question from several angles, we pursued a dual method. First, we constructed a detailed questionnaire from a systematic review of what had been learned in the professional literature. Tis questionnaire was paired down to 42 core variables in order to keep it manageable for respondents. Each project questionnaire was answered by three respondents: one respondent might have given a "biased" answer from the viewpoint of the organization that he or she represents. Terefore, the project owner (a senior civil servant familiar with the governance context) and the project supervisor (the "in the feld" civil servant), as well as the project manager of the main contractor, all flled out the questionnaire, representing the views of three diferent players in the project. (All respondents were guaranteed anonymity to protect them—many were worried about possible repercussions. We checked the response data for "self-censoring" but found evidence that the diferent perspectives of the respondents were preserved in their answers.) With the questionnaire, we collected primary quantitative data on 38 abandoned and completed projects, which we analysed econometrically. Te quantitative data provided a "skeleton", establishing that the data contains statistically robust fndings. Second, we enriched this skeleton with detailed case studies on 11 of the 38 projects. Te resulting causal stories explain what the statistical results "look like" in practice.

Chapter 4 presents the list of the projects examined, with short descriptions. Te projects do not simply constitute an arbitrary list; indeed, the list matches completed and abandoned projects with respect to budget size and sectors so that they can be compared.

Chapter 5 presents the econometric analysis of the questionnaire data, which identifes the statistically signifcant drivers of completion versus abandonment. Te analysis statistically condenses the 42 variables (some of which overlap, measuring similar and related things) into 5 more conceptual constructs, which measure common success forces. Te fve drivers are project goals, supervision and stakeholders, contractor selection, resources and planning, and corruption. Te econometrics confrm that these fve drivers make a real diference to a project's chances of reaching successful completion.

Chapters 6, 7, 8, 9, 10 and 11 present 11 detailed case studies, matched by sector, of abandoned versus completed projects. Tese detailed examples tell the stories of these projects, bringing to life what the identifed statistical success drivers "look like" when we see them in real projects. Te common themes of problems become clearly visible across the projects. Te combined insights from the econometric analysis and the case studies form the basis of recommending what changes the government might make in order to render very large government projects more productive for Nigeria.

Chapter 12 collects the common themes from the case studies and presents them in a pattern. We then obtain some inspiration from other developing countries who have achieved signifcant improvements in their performance of large government projects. In the comparison of the patterns from our Nigerian data and the observations from other countries, we derive sharp and actionable recommendations for the government. Our evidence strongly suggests that if the Nigerian government submits to the discipline of these recommendations, the completion performance of large government projects will improve.

Finally, Chap. 13 concludes the study. No book on large government projects is available for the case of Nigeria, and we therefore hope that this study will help to create value. Te senior government in Nigeria has both ample power and the means to make its large projects more successful—the requisite changes are not so complicated that they cannot be implemented. What is required is the political will to pursue overarching success for the country, a will that various presidents of the country have clearly shown (albeit not consistently enough). Te lessons from Nigeria might well be relevant for other African nations who face some of the same challenges.

## **References**


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **2**

# **What We Know About the Management of Very Large Projects**

Very large projects (or "major programmes", in the terminology of Morris and Hough [1987], or "megaprojects", in the terminology of Flyvbjerg [2014]) are defned as complex undertakings involving thousands of people, with budgets of several hundred million dollars over multiple years. In our study we focus on very large *government* projects, which is the category of projects that promise to signifcantly improve Nigeria's economy but which have hurt the country because so many of them have wasted money and opportunities.

Te starting point for the need to build specifc professional knowledge on very large government projects is that the classic project management approaches represented in the *Project Management Body of Knowledge* by the Project Management Institute (*PMI*, 2017) are insufcient. Te "stage gate process" approach of setting goals, identifying activities through a work breakdown structure, planning the activities (in ways that are mutually compatible), adding risk management and bufers, and monitoring budget compliance and milestones (intermediate deliverables) simply does not address the key difculties inherent in very large projects: not only are the activities interdependent and therefore pose complex interactions, most critically, goals do not "fall from the sky" but are carefully negotiated constructs that demand both general buy-in and tangibility and feasibility in order to provide a solid basis for a project. Tis nature of project goals being "socially constructed" is particularly critical for large government projects, which touch upon multiple sub-groups of the population of a country.

Tis book is the frst on large government project management in Nigeria, but it is by no means the frst book on the subject globally. Famous examples abound across the globe of large (public) projects that ran into trouble, for instance, the Eurotunnel in France/the UK, the Hinkley Point nuclear power plant and the Crossrail project in the UK, the Berlin Airport in Germany and the collapsed terminal of Charles de Gaulle Airport in Paris, or the Denver Airport baggage transport system in the USA. Terefore, the management challenge of very large projects has been the focus of attention for practising managers and scholars, with textbooks and articles being produced on the subject over the last 60 years. Te purpose of this book is not to reinvent the knowledge that has been accumulated but to examine its adaptation (if any) to the Nigerian context. Tis chapter summarizes some important elements of professional knowledge about very large project management; building on this knowledge, it then constructs a framework of variables that provides the basis for our study.

# **2.1 Project Success Factors as Lists**

Very large projects are characterized by two challenges that make them hard to manage:


collaboration between owners and stakeholders in renegotiating these outcomes.

Terefore, projects have been characterized as "evolving complex systems"—very large projects are complex beasts, and it is possible to get them wrong in a hundred diferent ways. Multiple studies have explored which characteristics of the environment, the task, and its complexity and uncertainty, the team, the surrounding organization and the management processes are important. As academic studies tend to focus on a narrow set of phenomena in order to be able to accomplish a "clean" investigation with reliable results, each study has tended to focus on a few variables at a time.

Table 2.1 provides a summary of 14 studies that produced "lists" of success drivers, with overlaps but also diferences. As each study looks at its own set of circumstances, each observes a diferent set of success drivers as particularly relevant. To use an old Indian metaphor, seven blind men touching an elephant will each report diferent experiences because they each touch diferent parts of the animal.

Te success factors that have been emphasized shifted over time as knowledge progressed. Early studies such as Sayles and Chandler (1971) and Martin (1976) emphasized planning and resource management, team management, and supervision and control. In the early 1980s Baker, Murphy and Fisher (1988) turned their attention to factors related to the surrounding organizations and environments. Te next decade of work added attitude and intent, project goals and social orientation (Baker et al., 1988).

However, a "super list" of success drivers that is simply the combination of the partial lists is of limited use because it does not enable an understanding of causality and therefore does not support a problem diagnosis of a specifc project at hand. Terefore, "frameworks", or groupings/classifcations, of success drivers have been proposed. In this way, Belassi and Tukel (1996) proposed a framework in which the characteristics of the project manager and the team (such as ability, coordination and communication), of the project itself (such as size or uniqueness), of the organization (such as support and structure) and of the environment (such as politics and social) infuence intermediate outcomes (such as client acceptance, the project manager's performance and resource availability), which in turn infuence project success. Misic and Radujkovic (2015) conducted a meta-analysis of previous studies and proposed a framework with success drivers falling into the groups of legal, risk, political and project manager and failure factors falling into the groups of strategy, inefectiveness of risk analysis and closed communication.


**Table 2.1**Lists of project success factors

Fortune and White (2006) developed, based on cases of IT projects, an explicit "system model" that features interdependent factors. Within the project, there is a decision-making system that allocates attention and resources, monitors performance and guides decisions. Te wider system (corresponding to the organization) decides on the project design, provides resources and defnes the performance expectations, as well as monitoring performance. Tis system as a whole is, in turn, afected by its external environment (such as stakeholders or political infuence).

We want to focus attention on two frameworks that have been very infuential and which are still, despite being 30 years old, insightful for a study such as ours. Tese two frameworks are proposed in the seminal studies of Morris and Hough (1987) and Miller and Lessard (2000).

## **2.2 The Project Success Frameworks of Miller and Lessard and Morris and Hough**

#### **2.2.1 Miller and Lessard (2000)**

Miller and Lessard (2000) analysed large engineering projects (not necessarily government-run) and developed an understanding of the critical phase of "project shaping". Projects are not "planned" but "shaped". Tey do not "fall from the sky" as clearly articulated visions of great outcomes, but they slowly arise as rough ideas that need to be wrestled over and developed. Tis process is fundamentally messy, chaotic and untidy, and the outcomes are not preordained but the results of decisions and moves (explicit and conscious or unconscious) made by managers—managers of the project owner, of various stakeholders and of customers and contractors.

Te fnal "design" of a project is not visible until much later, when several decisions have already been taken. A useful metaphor is imagining that one is fying into thick clouds (there is *something* attractive in the clouds, one needs to be convinced), which prevent managers from choosing take-of or landing approaches beforehand. If prepared with fexibility and resilience, managers can achieve success against all the odds. No one has time to wait for a perfect quantifcation of the probability of success or failure before approaching large projects. Managers engage in various strategies to confront complex adaptive risk, including shaping and mitigating, shifting and allocating, infuencing and transforming institutions, and diversifying through portfolios. Risks are not externally given odds but shaped outcomes of decisions taken. Miller and

**Fig. 2.1** Miller and Lessard's shaping episodes and commitment achieved. (Adapted from Miller & Lessard, 2000: 106)

Lessard's navigating strategy for crossing hurdles over many shaping episodes (before implementation begins) is summarized in Fig. 2.1.

Te framework proposes that there are fve stages before the performance: concept (initiation and exploration of a *hypothesis* of a project that might be possible), script (holistic proposal that allows commencement of tangible negotiations), agreement (with a coalition of stakeholders after extended negotiation), moves and commitments (confronting emerging fears and ofering solutions and assurances until parties are willing to make irreversible commitments), and, fnally, the committable package (the project design and outcome distribution on which parties can achieve closure and fnal agreement—this is when contracts can be signed).

Tese phases must be traversed and their issues addressed as preconditions for the success of a very large project. If the shaping phases are glossed over, or trust and commitment are not achieved, the unaddressed issues will return later to haunt the project when it runs into inevitable problems over the course of execution. Te shaping process ensures two key preconditions for success: (a) shaping (modifcation) of the original idea to ofer value to all parties that contribute to, and can infuence, the project (the original idea is never sufciently balanced!); and (b) the building of a committed coalition that has at least a chance of withstanding the problems and changes that a very large project will have to go through.

#### **2.2.2 Morris and Hough (1987)**

Miller and Lessard's framework directs our attention to the critical early phase of a project, long before any procurement has commenced—this turns out to be very relevant for the abandoned large government projects that we encounter in this study. Te strength of Morris and Hough's framework, by contrast, lies in providing an overarching view of the issues that a very large project must address. Tis framework was articulated based on eight detailed case studies of very large projects. It is summarized in Fig. 2.2.

Te shaping process explained by Miller and Lessard is represented within the box "project defnition", including the relatedness of the goals to the participants and an absence of forcing decisions on them—the shaping process is not included in-depth (for this reason, the Miller and Lessard framework is worth taking into account in parallel), but the strength of Morris and Hough is the overarching view.

Te framework includes the conceptual areas of client and owner attitudes (constructive or political?), the external environment (e.g. politics, communities and stakeholders), a sound fnancial plan and realistic and trackable schedule, and implementation driven by the organizational contract, resource availability and the quality, commitment and communication with the "team" (the people who work on the project).

Te fact that arrows in the framework point in diferent directions (forwards and backwards) reminds us of the complexity of the project "beast" there is no one-directional causal fow, but while project shaping infuences later commitment, the scheduling and resource abilities from later also infuence the shaping processes at the outset, and parallel activities infuence one another.

We will now check whether previous studies from Nigeria are roughly consistent with the knowledge embodied in the success drive lists and the two frameworks (Table 2.1 and Figs. 2.1 and 2.2), or whether there is evidence that what is happening in Nigeria has fundamentally diferent characteristics. We will then build a combined framework that attempts to take into account all the aspects of previous knowledge that we have described, in a form that is suitable for measurement via a questionnaire.

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**J. Ibrahim et al.**

### **2.3 The Nigerian Context**

We pointed out in Chap. 1 that Nigeria sufers from poor performance (even widespread abandonment) of large government projects. Te consequences are "a junk-yard of abandoned and failed projects worth billions" (Abimbola, 2012; Osemenan, 1987). Anigbogu and Shwarka (2011) observed that 50% of projects failed before they even commenced. Ayangade et al. (2009) also proposed that if a project is awarded in defance of proper intent and contract defnition, this will lead to fawed contract structures, poor job performance, job abandonment and improper contractor selection, thereby increasing the probability of project failure. All this is consistent with the hypothesis that Miller and Lessard's shaping process is neglected or forgotten, resulting in poor set-up and intent.

Even among completed projects, Omoregie and Radford (2006) found average cost escalations of 114% and cost overrun and time delays of 188% across transport infrastructure projects. Ameh et al. (2010) found similar cost overruns in the telecommunications sector, driven by construction-related factors. Tese overruns among *completed* projects, for now disregarding the abandoned projects, are consistent with observations from other countries (see Flyvbjerg, 2007, 2014; Toor & Ogunlana, 2008; Roxas & Fillone, 2015). To give some examples, the Akashi Kaikyo Bridge project in Japan (1998) overran its budget by 263%, the Sydney Opera House by 1400%, the Denver International Airport by 200% and the Elbe Tunnel in Germany by 50%. Te element of Nigerian large project performance that seems to be worse than in other countries is the extent of project abandonment.

Okereke (2017) examined eight case studies of troubled large projects across Africa, including a renewal energy project in Nigeria. He found that the Nigerian project sufered from poor planning and a lack of both government support and management of maintenance once the facility had been completed. More generally across Africa, he concluded that the main reasons for failures lay in a lack of skills, resources and stakeholder considerations. Tis study thus sees key success drivers in the implementation and stakeholder phases of projects.

Olatunji (2018) examined in detail one especially large stalled project, the Ajaokuta steel plant project in Nigeria, which we will also revisit in detail in Chap. 11. Although the project had been discussed at length, when work began in earnest its gestation period was very short and decisions were made for political rather than performance reasons (such as being located in a politically desirable region but far from ore and coal), neglecting technological constraints (such as the low iron content of the local ore) and exacerbated by numerous changes in the political leadership of the country. Te resulting cost increases made the available fnancing insufcient, and therefore, the plant is still not operational 30 years on. Olatunji calls it "neither a complete failure nor a considerable success. Rather, it is more of a story of philosophical symbolism" (p. 339), an assessment that we disagree with (see Chap. 11). However, the case study is again roughly consistent with the importance of Miller and Lessard's shaping process, as well as with continuity of execution.

In sum, the available evidence from Nigeria presents nothing to suggest that the success drivers that are at play are fundamentally diferent from what the global professional literature has identifed to date. Tis supports our expectation that the question is not "What unique reasons exist in Nigeria that have led to the abandonment of 63% of large public projects?" but "Which success drivers (of the many that have been identifed) are particularly important in the Nigerian context, explaining the high rate of large project abandonment?" We therefore proceed with the construction of a combined framework that includes the work reviewed so far (Table 2.1 and Figs. 2.1 and 2.2). Te combined framework will serve as the basis for the empirical study.

## **2.4 The Extended Theoretical Framework**

We now combine the most important success factors from Table 2.1 and from Morris and Hough (1987) and Miller and Lessard (2000) into one combined framework, as shown in Fig. 2.3. Te framework has a similar structure to, and the same presentation as, Hough and Morris, as this representation of grouped success factors is well suited for capture in a set of measures that can be tested in a questionnaire. It is a conceptual framework that explains the concepts (success factors) that we have identifed from the accumulated knowledge (as opposed to a theoretical framework that explains causal relationships [see Grant & Osanloo, 2014]) and which we want to examine further.

Te combined framework starts with attitude and intent (as in Fig. 2.2) but divides "project defnition" into two parts: the defnition itself (how clear, valuable, visionary and feasible/pragmatic—clear and accepted goals are valuable as maps during the complexities of execution; and the shaping process that we have incorporated in order to represent Miller and Lessard's insights.

Te shaping process produces a shared vision, combined with preparedness for the necessary problem-solving in the face of inevitable changes: (i) the need to test the vision with stakeholders and pre-work to prove the concept

• • • • •

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• • • • • • •

Concurrency of tasks applied only with

appropriate risk management and

communication

(e.g. technical tests and social impact tests), (ii) iteration of thought to reduce technical and stakeholder risks, (iii) the use of proven technologies (if novelty, then appropriate bufering and back-ups) and (iv) the assembly of a stable coalition of sponsors and supporters committed to the project. A successful project is not selected (i.e. chosen at the outset in all its features from a feld of project candidates) but "shaped", in the sense that an initial idea evolves and morphs to incorporate more and more essential elements and robustness. When plans are shaped and reshaped, it becomes possible to conclude that the project is not viable, and sponsors can cut their losses on time. Te shaping process is essential to project success because of the robustness (in terms of technical and operational concepts and stakeholder support) that it creates.

We have added a box on risk management (which should proactively commence in parallel to the shaping process). Tere is a need to prepare the project for the landscape of risks; some risks can be anticipated, while others are unknown until they occur. Mapping project risk requires (i) accurate risk identifcation (external experts and scenario identifcation); (ii) risk prioritization (e.g. by impact or likelihood); (iii) risk management, for example, via a countermeasure portfolio (bufers, mitigation, elimination, contingencies and insurance); and (iv) the knowledge that mega projects always have some unknowns, so some "pre-warning" can be produced by identifying knowledge gaps (the areas of black swans or unknown unknowns).

We have divided Morris and Hough's "environment" box into two parts: one for the external general environment and one for the stakeholders that are specifc to the project. External factors are outside the infuence of the project organization. An external factor might even be the government of another country. For instance, the Kariba Dam in Zambia owed some of its success to external infuence. Te sudden discovery of a design faw required a foreign power's support for the dam to be repaired (at a cost of \$298M). Te money needed for reconstruction was beyond the reach of the domestic government. External factors include prices, regulation, corporate changes, regional and political constellations, individual and government commitment, and community factors. Te ability of a project to achieve its goals also depends on the attitude or communication quality with the exogenous environment. Te term "stakeholder" refers to a person or an organization (interest group) with an interest in, or concern about, the project. Henisz (2016) identifed various ways of mapping and involving stakeholders such as politicians, industries, pressure groups, communities or the public.

Te planning and resource management box addresses the "homework" that each project team needs to do, putting well-considered plans and schedules in place, with contingencies and interdependencies well understood, and monitoring procedures well established and integrated with risk management (as in Morris and Hough). A key element of this is that the resources for the project must be planned and safeguarded (so they do not unexpectedly disappear or need to be "re-won"). Tis may sound evident, but it turns out that this very point is often not fulflled in the Nigerian context.

Team management refers to leadership at the project level, skill availability, sponsorship in the wider organization (including the government agencies that supervise) and efective problem-solving, monitoring and communication procedures.

Supervision and control refer to the presence of a functioning "governance structure" (or steering committee) that has the competence and time to understand the project's status and to make decisions when changes or conficts occur (Loch et al., 2017). When this governance structure does not perform, projects succumb to the problems that inevitably arise but are mastered by well-governed projects. Tis governance must be led by the owning government agency, using resources and skills, but unfortunately, this is often not guaranteed.

As most large government projects are carried out by contracting frms, contractor management is central. Tis includes both legal provisions and maintaining trust and relationships that reduce a contractor's temptation to behave opportunistically. Te project manager must ensure that the contract and contractors are managed. Contract management in large government projects requires: (i) contractor selection by quality and track record, not just price; (ii) explicit bid specifcation (quality and realism); (iii) risk and uncertainty distribution, dispute resolution and incentives; (iv) collaboration and communication both with and among contractors (coordination); (v) continuity of contractor personnel (if a change cannot be avoided, there must be proper handover and training); and (vi) involvement of contractors in monitoring and preparing the necessary changes to encourage sharing in the spirit (not just the letter) of collaboration.

Tis framework summarizes the relevant professional knowledge on very large (government) projects in a form that can serve as the basis for our empirical investigation of why so many government projects are abandoned in Nigeria. As we said earlier, we do not expect phenomena to arise that have never been observed elsewhere (although if this were the case, our case studies would have a chance to detect these "new" success drivers). Our study will translate this framework into a questionnaire to collect analysable data and complement the data analysis with qualitative case studies that provide causal narratives on how events have unfolded.

## **2.5 What About Corruption?**

Finally, a word on corruption. Corruption is pervasive, not only in developing countries but also to some degree in developed countries. It has not appeared in our overview of professional knowledge—this is not because it is not important but because it is uncomfortable to discuss. Corruption clearly does exist in Nigeria. Studies have examined the efects of corruption in other countries: a classic theoretical analysis (Shleifer & Vishny, 1993) analysed corruption in comparison to a "tax". Tis study concluded that corruption, because it is illegal and secretive (as its proceeds beneft a special interest group rather than the public), is much more costly and damaging than taxes; moreover, weak governments that do not control their agencies tend to sufer more from corruption than strong governments with transparency and processes in place. In an empirical study Locatelli et al. (2017) examined corruption in large rail projects in Italy, and while they found it hard to quantify the efect of corruption, they found strong evidence that it causes additional budget and schedule overruns.

It is very difcult to get people to speak about corruption because of their concerns about the repercussions. We conducted one interview with a senior project manager of a major contractor (who spoke on the condition of guaranteed anonymity). Tis person estimated that corruption adds, on average, 30% to the budget of a large government project.

Tis would be bad enough, but if this were all it would perhaps be a small price to pay if one could prevent the abandonment of large government projects by paying some people of. However, corruption is even more corrosive because it also distorts decisions. For instance, some project goals are downplayed, which benefts the goals of the briber; some stakeholders may be frozen out because others have bribed; and the project design may favour some performance dimensions, which are in the interest of the bribers, over other dimensions. As a result, projects afected by corruption will *drift* away from the public beneft purposes that they are supposed to serve; as a result, their value will diminish, resistance from left-out stakeholders may increase, projects may become more likely to fail, and, if they do succeed, they will provide fundamentally diminished value to the public.

In order to test this corrosiveness of corruption, this success drive will be explicitly added to our questionnaire, as we describe in the next chapter. Te efect of corruption on project decisions will be visible in the econometric analysis and be illustrated in detail in several of the case chapters (in particular Chap. 10).

## **References**


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **Structure of the Investigation**

## **3.1 Overview of the Approach Taken in This Study**

Chapter 2 demonstrated that we are not looking at a completelvy unknown phenomenon—much knowledge exists about the challenges of very large public projects. We do not need to go out in the feld and document phenomena that have never been seen before, proving that they have systemic causes and are not just idiosyncratic anecdotes. Te existing work suggests that very large projects are complex social systems, the success drivers and challenges of which are roughly known but which are very difcult to manage because their specifc instances interact and change over time. Moreover, not all the drivers are always relevant, but it is important to understand which are critical in specifc situations. In other words, we are trying to identify the most important issues that go wrong in the specifc Nigerian public sector context and how one might correct these issues.

A good method to test existing theoretical (causal) knowledge would be the careful statistical comparison of project characteristics from archival databases. If we compare thousands of projects with respect to success and the absence or presence of challenges and success drivers, we can use statistical methods to fnely distinguish which success drivers make a diference and which do not. However, we have already pointed out that large-scale project data is simply not available in Nigeria, neither from government sources nor from accessible journalistic sources.

Terefore, we need to create our own database of projects. One good way of doing this is a survey—asking people who are involved in large projects to answer questions about the known success drivers (Creswell, 2009). Comparing the responses across projects enables us to test whether the identifed success drivers actually make a diference. Indeed, this is one method that we have used: we asked 3 diferent respondents from each of 20 completed projects and 20 abandoned projects to respond to a questionnaire (and we obtained answers from all 3 respondents of 38 of the 40 targeted projects). We describe the way in which we carried this out in the next section of this chapter.

Questionnaires have limitations—even if each respondent flls out the questions with someone sitting across the table helping them (thereby reducing problems of sufcient efort and common interpretation), predefned questions only capture certain types of information, possibly missing additional issues that did not ft the assumed structure of the problem. Terefore, we added a second method by writing detailed case studies, "telling the causal stories" of what actually happened for 11 of the 38 surveyed projects. Ten cases comprise paired stories of a completed and an abandoned project in the same sector, and the eleventh case is the only steel plant in the sample, Ajaokuta, which has cost the country a phenomenal amount of money (\$5B and counting) without ever having produced a single ton of steel, and on which a previous case study already exists, which we shall revisit. We describe the way that we conducted the case studies, using a combination of interviews complemented by independent desk research from public sources, in the last section of this chapter.

## **3.2 Construction and Execution of the Survey**

Questionnaires represent a useful method to test existing knowledge (or theories). Tey ofer a number of advantages. We discuss these advantages, as well as their disadvantages, and how we used our design to limit these disadvantages (Popper, 1959; Rattray & Jones, 2007; Taylor & Bogdan, 1998; Grant & Wall, 2009). Te strengths of the questionnaire method are as follows:

• Te quantitative data generated can be used to test existing knowledge and theories and their hypotheses (this is called the "positivist view", which holds that data can be "objectively" described and quantifed).


Te disadvantages of questionnaires are as follows (we outline how our design attempts to limit the disadvantages):


questions about interpretation and making sure that nothing was glossed over.


Here, we describe how the questionnaire was designed and executed. We started with the extended project management framework that concludes Chap. 2. Tese are the success drivers that 40 years of previous work have identifed as professional knowledge about very large projects. We went through the following steps:


authors did not simply invent measures but looked in previous literature across several disciplines (such as IT and engineering) to see how such constructs had been translated into measures before (Benaroch & Chernobai, 2017; Chua et al., 2012; Constantinides & Barrett, 2015; Dawson et al. 2016; Gopal & Gosain, 2010; Huber et al., 2017; Langer et al., 2014; Mani et al., 2014; Moeini & Rivard, 2019; Oliveira & Lumineau, 2017; Sabherwal et al., 2019; Tallon et al., 2013; Tian et al., 2015; Tiwana & Kim, 2015; Tiwana & Konsynski, 2010; Wu et al., 2015; Young Bong et al., 2017). As a result, the measures that we identifed were not arbitrary inventions but had been tested and validated previously. Tis step resulted in 90 validated measures (including outcome measures).


Te result of this process was a data set of 114 questionnaires (3 from each project), with project outcome information and 41 measures of success drivers that had been validated by theory and by previously used measures in wider project management research. Tis data set formed the basis of the analyses reported in Chap. 5.

## **3.3 Construction of the Sample of Projects**

Constructing a database of large government projects that enables a systematic comparison of successes and failures is difcult. In the absence of systematic data (the reader may remember that the commission that found a 63% abandonment rate of large government projects did not publish a list!), the projects had to be identifed and paired for comparison, and the representatives of the abandoned projects had to be convinced to provide responses.

Tis took signifcant efort, time and investment of social capital. Business schools all over the world (including in Nigeria) are drowning in case studies of companies that have succeeded. Companies (and government agencies) love to talk about successes, and they use case studies as marketing tools to showcase to students how great they are. But take a look at how many failures are discussed in public, and you will fnd that there are very few. Organizations (even more than individuals) loathe speaking about their failures because they fear damaging their external image. Add to this the pressure on large government projects in Nigeria from the press and the public, and the reader may understand why no one has yet constructed this kind of data—not because no one cared but because it is difcult to do.

Table 3.1 presents the sample that the authors were able to construct. It contains 19 completed and 19 abandoned projects (of the targeted 40). Because of the abovementioned challenges, this sample is, to some degree, "opportunistic": Which projects could we fnd that were completed versus abandoned, and which ones had senior managers who were willing to respond to a questionnaire? Te sample is not arbitrary but consists of *matched pairs*—a pair of projects belongs to the same sector, has a similar budget size and, if possible, was carried out by the same contractor (the latter was possible only in around a third of the cases).

Te matching reassures us that the outcome diferences were not caused by large diferences in context, complexity (the sector) or budget size, or by the abandoned projects somehow having worked with less competent contractors. Te matching increases our confdence that the variables measured in the questionnaire indeed captured the diferences between the paired projects.


**Table 3.1** The sample of projects in this study (*continued*)

**33**


**Table 3.1**

(continued)

Collectively, this sample covers key sectors of government investment—roads, airports, power stations, ports, housing, ICT systems, waste management, hospitals, education and social projects. Tis increases our confdence that our fndings do not just describe one specifc sector but really do capture systematic elements of how the Nigerian government manages its large investment projects. Each project is presented in more detail in Chap. 4.

### **3.4 Construction of the Case Studies**

Earlier, we discussed the limitations of surveys: although the quantitative analysis can demonstrate that there are systematic diferences between the management practices of completed and abandoned projects, the variables are stylized. Terefore, the econometric analysis in Chap. 5 remains conceptual; it does not bring to life what the project problems looked like; it does not illustrate the causality of *how* the success drivers "drive" success; and because the questions represent the theoretical lens of our framework from previous professional knowledge, they may overlook "other" things that happened, which may ofer "other" explanations. Terefore, we have chosen 11 of the projects in the sample for more detailed case studies that "bring the story to life".

Te 11 projects are again matched pairs, comprising 1 completed and 1 abandoned: 2 education projects (Abuja National Library and Obasanjo Presidential Library), 2 bridges (Tird Mainland Bridge and Second Niger Bridge), 2 roads (Lagos-Ibadan Express Road and Lagos-Badagry Express Road), 4 power plants (Egbin versus Calabar Power Stations, and Zungeru Hydropower Plant versus Delta State Power Plant) and the 1 steel project in the sample, the Ajaokuta Steel Project, chosen for its size and prominence.

To write these case studies, the authors visited the sites and interviewed people on location, as well as in the ministries where decisions had been made. Te interviews lasted 1–2 hours (some of which covered more than one case), and site visits lasted at least half a day each. Te interviews are listed in Table 3.2. As is recommended by case study method experts (Yin, 2014), interview and site visit notes were written on the same day that the interviews took place. Later, the accounts from the interviews were complemented by desk research that cross-checked the accounts and flled in the gaps that the interviewees had not covered.

It turned out that the case studies did *not* reveal additional phenomena that had not been included, in principle, in the identifed professional knowledge on very large projects. However, the case studies did show how the success


**Table 3.2** List of respondents interviewed across organizations

drivers worked and how the success drivers interacted with one another (e.g. if the project does not have stable funding, then contractors are tempted to play games in order to secure getting paid), as our narratives demonstrate in Chaps. 6, 7, 8, 9, 10, and 11. Moreover, the case studies reinforced the observation from the econometric analysis (Chap. 5) that there were consistent themes, across projects and sectors, regarding how the Nigerian government managed its large infrastructure projects in ways that turned out to be self-damaging.

## **Appendix: Full Questionnaire as It Was Administered**

Te University of Cambridge Judge Business School ofers a Business Doctorate Degree for very experienced and senior business people. Te goal of this programme is to combine the student's vast experience with rigorous methodology to produce knowledge of high relevance and impact.

Te thesis of which this questionnaire forms a part has the theme "Te Major Leadership Challenge of Government Major Project Delivery in Nigeria". Te project attempts to understand and improve management practices in the set-up and execution of very large infrastructure projects in Nigeria. Such projects have budgets of approximately \$1 billion, have thousands of people working on them and take a decade or more to complete. Unfortunately, many such projects do not succeed, which represents a signifcant drain on the scarce resources of the entire country. Te experienced student undertaking this research is a senior Nigerian executive, Dr Jimoh Ibrahim Folorunsho.

#### **Our Request**

Te University of Cambridge solicits your support and assistance in the completion of this survey questionnaire. Tis will take approximately one hour, and we will make a guide available to help you articulate the answers. Te purpose of the questionnaire is to examine management practices in large infrastructure projects in Nigeria.

Te University will appreciate your sincere and honest views. Te doctrine of exclusion and limiting clause shall be applicable, and neither you nor the University can be held responsible for any liabilities arising directly, or otherwise, in the course of the investigation relating to the opinion expressed. *All your answers will remain confdential and will not be shared with outside parties. Only aggregate results will be published—no individual responses.* Te fndings of this study will be publicly available in such an aggregated form. If you have any further questions, please contact any of the following by email: c.loch@jbs.cam.ac.uk k.sengupta@jbs.cam.ac.uk or if21@cam.ac.uk

On behalf of the Cambridge Judge Business School, we express our appreciation for your time spent completing this questionnaire.

## **Project Variables**

## **Section A: Background Information**


**Section B: We are asking 40 questions that relate to the methods and structures with which the project was managed. (***Circle the number* **that corresponds to your reaction/estimation or fll out the text.)**

### *A. Governance*

1. Te project had a well-defned supervision structure (e.g. a combination of clear oversight by a government body with an external execution supervisor).


2. Outline the decision hierarchy structure (e.g. "minister – project ofcer – professional project supervising consultant – main contractor").

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_


3. Te composition of the supervision structure remained stable throughout.

4. Te supervision structure provided oversight on a regular basis throughout the project.


5. Te supervision structure provided clear guidance when it came to grey areas.


6. All key decisions were approved by the supervision structure.


7. Te supervision structure was regularly kept informed of key aspects of the project.


#### 8. Te supervision structure met regularly.


9. Te credentials of the members were subject to due diligence prior to membership.


10. Te supervision structure regularly uncovered difculties in the project.


11. Te supervision structure regularly uncovered irregularities in the project.


12. Te supervision structure provided adequate guidance for resolving problematic aspects of the project.



13. Signifcant gratifcation in any form was present in this project.

14. Te primary contractor was selected through a selection process appropriate for projects of this scale.


15. Te selection process was rigorous and open.


16. Te selection process considered contractors' demonstrated experience in similar projects elsewhere.


#### *B. Project Initiation*

17. Details regarding planning for the project received wide visibility, for example, through a website.



18. Te public were able to ask questions regarding the project.

19. Key stakeholders outside the narrow decision circle had visibility and input before the approval processes of the project.


20. Te goals of the project were clearly understood by all parties.


21. Te goals were clearly measurable.


22. Te prioritization among the most important goals was clear.



23. Te project was created with a demonstrated business case defning the goals and public benefts.

24. Te benefts of the project to the economy or society were clear and measurable at the start of the project.


25. Te project goals and business case were subject to risk scenarios to capture the risks of outcomes.


#### *C. Project Execution*

26. Te primary contractor had strong *capability* to deliver a project of similar characteristics and scale.


27. Te primary contractor had strong prior *experience* in similar projects with a *track record* of successful delivery of similar projects.


28. Te primary contractor and the supervising party had clearly defned roles.


29. Te primary contractor and the government's assigned project supervisor (see Question 2) worked together constructively when problems occurred in the execution.


30. *Sub-contractors:* Taken together, the sub-contractors had strong *capability* to deliver a project of similar characteristics and scale.


31. Te project had formal plans for managing stakeholders outside the project.



32. Te plans were actively used to positively infuence stakeholders.

33. Stakeholder views were used to make changes that improved the viability of the project.


34. Te project was adequately resourced (in terms of funds) for its initial size.


35. Te project funding was renewed/maintained when the project needed the funds to proceed.


36. Te project had an adequate supply of skilled staf on the government side.


37. Te project had adequate logistical support, for example, for delivery of materials or personnel.


38. Te timeline of the project plan was realistic.


39. Te project had a well-defned risk plan.


40. Te risk plan was comprehensive in the management of risks that did occur.


41. Te quality of the risk plan was consistent with similar plans used in projects of this magnitude worldwide.


### **References**


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **4**

# **A Description of the 38 Matched Projects**

Table 3.1, in Chap. 3, lists the project sample. It consists of 38 projects divided into 19 pairs, with 1 completed and 1 abandoned project each, matched by size, sector and (when possible) contractor. Tis chapter gives more detailed descriptions of the projects, ofering an impression of each one. Detailed case studies are provided for 11 projects in Chaps. 6, 7, 8, 9, 10 and 11. Te numbering of the projects corresponds to the numbering in Table 3.1.

# **4.1 Lagos-Ibadan Express Road**


Te Lagos-Ibadan Express Road is a 127.6 km expressway from Lagos, Nigeria's largest city, to Ibadan, the capital of Oyo State. Te expressway is the oldest in Nigeria built at the end of the 1970s and, as a primary connection to the north, south and east of the country, the busiest in Nigeria (more than 250,000 cars daily). Te reconstruction contract to widen the road and increase its capacity was awarded by President Goodluck Jonathan's Administration in 2013 at a value of more than \$500 million (Wikipedia, 2021a). Work is ongoing, with signifcant success in terms of completion achieved during the last visit to the project site (Fig. 4.1).

**Fig. 4.1** Lagos-Ibadan Express Road

Te project was included for investigation because of its economic signifcance to the Federal Republic of Nigeria (particularly the two interchange sections of the Lagos-Sagamu Road of Ogun State and Sagamu to Ore and Benin of Edo State). Reconstruction of the expressway has helped to reduce the travel time of hundreds of thousands of commuters. An average of 250,000 vehicles use the road daily. Te contract was awarded to Julius Berger Nigeria and Reynolds Construction Company Limited (a Nigerian company) for the sum of \$800,986,290.

## **4.2 Lagos-Badagry Express Road**


Te Lagos-Badagry Express Road is a 60 km section of the Trans-West African Coastal Highway Expressway Road, and it provides connection across the Nigeria Boundary from Lagos through Benin to Dakar. Similar to the Lagos-Ibadan Express Road, this project is a reconstruction work to increase capacity. Te reconstruction contract was awarded in 2010 to the China Civil Engineering and Construction Company (CCECC). Te Lagos portion of the expressway should be widened from four lanes to ten lanes for road vehicles, and a light rail line should operate in the centre. Two of the expressway's lanes are intended for exclusive use by the Lagos State Government Bus Rapid Transit System (Fig. 4.2).

### **Rationale Behind Inclusion**

Te Lagos-Badagry Express Road was included in the list of projects to be considered for investigation based on its economic signifcance and because it is a transnational road.

Although the contract for rehabilitation of the Lagos-Badagry Express Road was awarded in 2009 by the Lagos State Government (LSG) to the contractor CCECC, the road had been in a dilapidated state for a long time, as the LSG failed to carry out complete work on the expressway after it promised to convert it to a ten-lane expressway. Residents and motorists lament the poor condition of the road, which results in accidents, damage to vehicles, a slowdown of economic activity and trafc congestion.

**Fig. 4.2** Lagos-Badagry Express Road

# **4.3 Third Mainland Bridge**


Te Tird Mainland Bridge with 11.8 km is the longest of three bridges connecting Lagos Island to the mainland. It was the longest bridge in Africa until 1996 (when a longer bridge was opened in Cairo). Te bridge connects the mainland at Oworonshoki to the Adeniji Adele Interchange on Lagos Island. Its construction was restarted (after an earlier aborted attempt) and overseen by President Ibrahim Babangida's Administration in 1990 (Fig. 4.3).

#### **Rationale Behind Inclusion**

Tis iconic project made the list for investigation considering its peculiar circumstances. Te Tird Mainland Bridge is an essential part of Lagos' daily commuting activity, and as such it requires continuous renovation. As a result of its high economic importance, and in order to reduce trafc congestion in the state, successive governments have continued to spend money on maintenance of the bridge.

**Fig. 4.3** Third Mainland Bridge Eobal End

## **4.4 Second Niger Bridge**


Te Second Niger Bridge connects Delta State with Anambra State. It was conceived to ease the pressure on the River Niger Bridge (built over 50 years ago) which became structurally overloaded by trafc. Te Second Niger Bridge project, itself 1.8 km long, is divided into three phases of construction—bypassing Onitsha and Asaba Roads, connecting the Owerri-Onitsha Express Way at Nkwerre-Ezunaka and then crossing Atani to the Asaba-Benin Expressway at Okpanam—with a total length of 44 km (Fig. 4.4).

#### **Rationale Behind Inclusion**

One relevant feature of this all-important project is that it was constructed by the same company (Julius Berger) that built the successful Tird Mainland

**Fig. 4.4** Second Niger Bridge

Bridge. We included both projects so that we could gain insights into the data collection on the phenomenon under investigation. Again, the project consists of four sections: the Asaba Road, the Toll Plaza, the Bridge and the Onitsha Road sections. Although designed over 30 years ago, the project should have been completed in 2017, but it is still not in use despite a large amount of funding.

# **4.5 Egbin Power Station**


Egbin Power Station was carried out under the Babangida administration beginning works in 1982; its start-up was commissioned in six subsequent units between May 1985 and 1988. It is the largest power-generating station in Nigeria, with an installed capacity of 1320 MW. Te station is located at Ijede/Egbin, approximately 40 km north-east of Lagos. Te contractor was the Marubeni Consortium, which used the Hitachi Company of Japan for the electric/mechanical works and Bouygues of France for the civil works (Fig. 4.5).

**Fig. 4.5** Egbin Power Station

Te Egbin Power Station is a gas-fred plant with six 220 MW independent boiler turbine units. It can also run on high-power fuel oil (HPFO). Te thermal plant represents one of the most signifcant projects in the power sector. Egbin Power Station is now privatized as a joint venture between Sahara Power Group and KEPCO, which acquired a 70% holding at a cost of \$407.3 million.

## **4.6 Calabar Power Station**


Tis power station was built as part of the National Integrated Power Project (NIPP), which was supposed to create 11 power stations across Nigeria. A simple cycle gas turbine built with the capacity to supply 561 MW of electricity to the national grid, it was completed in 2014 without delivering power as planned.

In September 2017 the Nigerian government signed an agreement with Seven Energy for the supply of gas to the power station to enable it to deliver 561 MW of power in order to bring the power plant to full functional capacity. Tese objectives have not been realized (Fig. 4.6).

#### **Rationale Behind Inclusion**

Naturally, it is important to investigate what went wrong with a power station that took over \$500 million in spending from the Nigerian national income without supplying a single megawatt of electricity. Te Calabar Power Station is currently non-operational after an investment of over a billion dollars. Nigeria is now one of ten countries in the world with an irregular supply of electricity.

**Fig. 4.6** Calabar Power Station

## **4.7 Zungeru Hydropower Plant**


Zungeru Hydropower Plant is located on the Kaduna River in Niger State, 150 km from Abuja. It entails an engineering, procurement and construction (EPC) contract consisting of a 700 MW hydropower station, a river dam, a 2400 m RCC roller concrete gravity dam and a clay core rock fll dam, a powerhouse behind the dam, and a tailrace channel, at an estimated cost of \$1.3 billion. Te duration of the work was planned to span 2013–2018 (57 months). Te frst phase was set to be released by December 2019. Te project has not quite been released, but completion is imminent at the time of writing (Fig. 4.7).

#### **Rationale Behind Inclusion**

Te host governor on the project recently remarked: "We are conscious of the importance of this project, not only as it afects our people, but for the nation too. Tat is why we put in place a committee to interface with the communities and the contractors. We don't want anything to delay the delivery of this project. All hands must be on deck to ensure that we have a hitch-free operation on-site and for the project to be delivered on schedule."

**Fig. 4.7** Zungeru Dam

## **4.8 Delta State (Oghareki) Power Plant**


Te Delta State Government conceived the idea of an independent power plant (IPP) project in order to boost the electricity power supply in the state. Te state hosts the majority of the oil production in Nigeria. Federal electric supply was 100 MW versus the 1000 MW of electricity needed. Te project is under fnancial investigation by a diferent government agency (Fig. 4.8).

#### **Rationale Behind Inclusion**

Te host governor said the following at the project's foundation ceremony: "We are glad as a state that we will be a hub for generations because of the peaceful nature of our state and the contribution to power in Nigeria." Despite having the right intentions, the project site experienced inactivity after spending over \$1 billion, very likely due to corruption, although no one has been

**Fig. 4.8** Delta State Oghareki Power Plant

convicted. Investigating the project will assist our understanding of the dynamics of the phenomenon.

## **4.9 Shiroro Hydroelectric Power Station**


Tis is a power plant with a 600 MW capacity, with a rock-flled concretefaced dam that is 115 m high and 700 m long. Te dam site has a reservoir of 7Bm3 . Te project has residential quarters, a hospital and a school. Shiroro has an electrical distribution network comprising an 11/0.41 kV distribution network and 11/0.415 kV sub-stations (110–200kVA). Assets consist of civil structures, the primary electro-mechanical plant and non-core assets. Tere

**Fig. 4.9** Shiroro Dam

are four hydraulic turbines, four generators, gates and hoists and plant auxiliaries, including a powerhouse portable water treatment plant, sewage treatment plant, lubricating oil treatment plant, one chlorination plant, two food control pumps and reservoir management equipment. Te project was privatized by the federal government on a private concession of 30 years (Fig. 4.9).

#### **Rationale Behind Inclusion**

Shiroro Hydroelectric Power Station assists our investigation in explaining project success in the much-needed electricity sector of Nigeria.

## **4.10 Omoku Power Plant Station**


Similar to Calabar Power Station, this power plant was meant to be part of the National Integrated Power Project (NIPP), via the Niger Delta Power Holding Company (NDPHC). It was to be a 252 MW gas turbine power station with 2x126 MW GE 9EA gas turbines. Te project was supposed to

**Fig. 4.10** Omoku Power Plant

complement the capacity of a previous project commissioned in 2006 by President Olusegun Obasanjo.

Te Omoku plant was inaugurated in 2006, but it did not improve the power situation in the state. Te project was under the investigation of the crime agency (Economic and Financial Crimes Commission, EFCC) based on petitions by indigenes who alleged that the project was overpriced (Fig. 4.10).

#### **Rationale Behind Inclusion**

Tis project ofers insights into project failures and why it was challenging to replicate the success factors in comparable projects such as the Shiroro Hydroelectric Power Station.

## **4.11 Mambilla Hydroelectric Power**


Mambilla Hydroelectric Power aims to construct a dam and reservoir at 1300 metres above sea level in order to generate electrical capacity of 3050 MW. Tree tunnels will lead into a 1000 m (3300 ft) drop shaft tunnelled down through the rock to an underground powerhouse. Te cost of over \$5 billion is to be 85% fnanced by the Nigerian government via a loan from the China Exim Bank. Te project design was fnalized in 2012 but on hold until 2016, when the contract was given to Sinohydro in 2017 (NS Energy, 2021). Te project was again stalled due to payment defaults by the Nigerian government to a contractor who lost out in 2017. However, an agreement has been reached (CPR Newsroom, 2021), and the project is fnally to take of with a goal to be operational in 2030 (Fig. 4.11).

**Fig. 4.11** Mambilla Site

Te size of the project (over \$5 billion) makes it one of the two most expensive projects in Nigeria. Tis is comparable with the Ajaokuta Steel Project. Te two projects have been included on the list of our investigation given their value of \$10 billion, which is 50% of Nigeria's total external debt.

# **4.12 Ajaokuta Steel Project**


In 1979 a tender went out to develop the Nigerian Steel Industry, and a contract was signed with Tyajz Prom Export (TPE). Te 1986 delivery date was rescheduled to 1989. Although TPE had a track record of on-schedule, on-cost delivery of steel projects, the project, initially scoped at \$650 million, absorbed over \$5 billion before being abandoned in 1994. In 2000, the project was restarted based on a public–private partnership (PPP) scheme, but stopped again because of corruption charges related to the award of the commission. In 2016 the sole administrator of the Ajaokuta Steel Company Ltd requested N43B (\$113M) from the Senate Committee on Privatization for a light mill section of the plant and N5B for the completion of a thermal generation plant. Tis request was made after 38 years had passed and \$5 billion had been spent without any steel production being accomplished (Fig. 4.12).

**Fig. 4.12** Ajaokuta Steel Plant

Te project (costing above \$5B) is one of the two most expensive projects in Nigeria (with the Mambilla Hydroelectric Power project in Taraba State). Te two projects made the list of our investigation given their value of \$10 billion, which represents 50% of Nigeria's total external debt.

# **4.13 Kanji Dam**


One of numerous water projects in Nigeria, this signifcant water project started in 1964 and was completed in 1968 at a cost of about \$200M.

It is one of the longest dams in the world, extending over approximately 10 km. As only 8 of 12 planned turbines have been installed, capacity is only 760 MW instead of the planned 960 MW. Te Kanji Dam generates electricity for all large cities in Nigeria, and some is sold to Niger. Electricity output has diminished on some occasions because of the unpredictable water fow of the River Niger during drought (Fig. 4.13).

**Fig. 4.13** Kanji Dam

Tis is one historic project that was completed on time and with beneft to the Nigerian community.

## **4.14 Otukpo Dam**


Te Otukpo Dam is a multi-purpose dam, initially designed for a combination of hydroelectric power generation, potable water supply, irrigation and primary dam construction. Specifcally, the dam was expected to provide a 130-million cubic metre reservoir and a 3.3 KV hydropower plant for efcient water supply upon completion.

Te multi-purpose dam construction was awarded to SCC Nigeria Limited in 2010 and was expected to be completed by 2014. However, after receiving 100% payment of the contract sum, the work is barely 35% complete and has long been abandoned, according to the Fiscal Responsibility Commission (Fig. 4.14).

**Fig. 4.14** Otukpo Dam Equipment Yard

Te dam was included as a matched opposite to the Kanji Dam, a project of similar size that was completed.

## **4.15 Nigeria Satellite 2**


Te President Jonathan Administration decided to build the Nigeria Satellite 2 (NigeriaSat-2) through the Nigerian National Space Research and Development Agency (NASRDA). Its mission was to enhance food security through monthly crop monitoring, to assist with burgeoning urban planning demands and, through the development of engineering skills, to advance the country's technological capability. In August 2011 NigeriaSat-2 was successfully launched on a Dnepr-1 launch vehicle using the space head module (SHM) confguration from the Yasny/Dombarovsky site in Russia (Fig. 4.15/4.16).

**Fig. 4.15/4.16** Nigeria Satellite Offces

In 2008 Nigeria lost the Nigeria Satellite 1 as a result of what some have alleged to be shoddy work by the project engineers. It is interesting to compare a successfully launched satellite with a failed one.

## **4.16 Nigeria Satellite 1**


Nigeria Satellite 1 was the frst of fve satellites launched by the National Space Research and Development Agency (NASRDA). Nigeria Satellite 1 was the frst Nigerian satellite, launched by the Kosmos-3M rocket from the Russian Plesetsk spaceport on 27 September 2003. It was part of the worldwide Disaster Monitoring Constellation System, having the mission of helping to detect and control desertifcation in the northern part of Nigeria, as well as identifying (with remote sensors) environmental conditions that breed malaria and meningitis. It was also meant to provide the technology needed to bring education to all parts of the country through distant learning and to aid in confict resolution and border disputes by mapping out state and international borders. In 2008 Nigeria lost the satellite as a result of what some alleged to be shoddy work by the project engineers.

#### **Rationale Behind Inclusion**

It is interesting to compare a successfully launched satellite with a failed one (see project 4.15).

# **4.17 Airtel Nigeria**


Airtel Nigeria provides mobile services to Nigerians. In 2001 the company became the frst telecoms operator to launch commercial GSM services in Nigeria and has scored a series of many "frsts" in the highly competitive Nigerian telecommunications market (Fig. 4.17).

### **Rationale Behind Inclusion**

In an environment with multiple IT projects, Airtel provided the opportunity for further investigation into the comparison of project success in the private/ government sectors. Airtel also provided Nigeria's network capacity and coverage on 3.75G platforms, ofering high-speed mobile Internet across the 36 states of the federation and the Federal Capital Territory in Abuja. According to Q4 2018 industry statistics by the Nigerian Communications Commission (NCC), the company ranked second in market share for GSM (25.64%) and Internet data (26.6%).

**Fig. 4.17** Airtel Nigeria

## **4.18 Nigerian Telecommunications Limited (NITEL)**


Nigerian Telecommunications Limited (NITEL), the result of a merger between the telecoms arm of the postal service and the telecoms arm of the Ministry of Communications, was a monopoly telephone service provider in Nigeria until 1992. Like other state-owned corporations, NITEL did not serve the market well, for example, provide only 450,000 subscriber lines to a population of over 120 million people.

After several failed attempts at privatization, in 2015 the government eventually fnalized a transaction that saw NITEL's and its mobile phone arm MTEL's assets transferred to NATCOM (Wikipedia, 2021b). With the great advantage of reliable infrastructure across the country—something that other operators would have jumped at—NITEL/MTEL remained a sleeping giant until its eventual sale (Fig. 4.18).

#### **Rationale Behind Inclusion**

Despite its privatization, NITEL did not succeed with the eventual sale of NITEL to NATCOM. NITEL had lost its market share in the Nigerian telecoms market, with new entrants taking a large portion of the market. Why should a project like NITEL have failed in the hands of the government despite its monopoly and then failed again in the palm of the private sector despite its efciency and skill?

## **4.19 Godswill Akpabio International Stadium**


Te Godswill Akpabio International Stadium in Uyo ofers 30,000 seats. It serves as home to the Nigerian Super Eagles, as well as being a centre for social, cultural and religious events. Te contract for construction was awarded in 2012 and the project was completed in 2014. Te modern multi-purpose sports complex was modelled after the Allianz Arena in Munich. Te stadium

**Fig. 4.18** NITEL Nigeria

is currently ranked as the best stadium in the country and is frequently used for local and international matches (Fig. 4.19).

#### **Rationale Behind Inclusion**

Te project demonstrates that large project management principles can be applied to sports venues with success. Te comparison with project 4.20 (the Ogbemudia stadium) tests whether the same diferences between completed and abandoned projects can be observed in the sports venue sector as in the other infrastructure sectors.

**Fig. 4.19** Akpabio Stadium

# **4.20 (Samuel) Ogbemudia Stadium**


Originally known as the Ogbemudia Stadium, this 20,000-seater stadium was mostly used for football matches and was the home stadium of Bendel Insurance FC. In 2009 the stadium was banned by the National League due to an unsafe playing surface. Tough the state government has attempted to renovate the stadium by signing a contract for the renovations with Peculiar Ultimate Consult, who promised to deliver by 2019, the stadium is still below standard and unft for matches (Fig. 4.20).

**Fig. 4.20** Ogbemudia Stadium

#### **Rationale Behind Inclusion**

See project 4.19.

## **4.21 Abuja International Airport**


Te Abuja International Airport was built 20 km West of Abuja between 2000 and 2002 and named after Nigeria's frst president, Nnamdi Azikiwe.

In 2006, a management contract was signed with a company for 25 years, which included additional facilities (Wikipedia, 2021c). But this contract was revoked by the next government in 2008. A second runway was approved in 2009, but an awarded contract was revoked because of excessive cost (Omoh, 2015). A total of \$50M were approved for the second runway in 2020 (Fig. 4.21).

#### **Rationale Behind Inclusion**

Te contrast between the two airports (4.21 and 4.22) seeks to verify whether the same principles between completed and abandoned projects apply as in the other sectors.

**Fig. 4.21** Abuja International Airport

# **4.22 Lagos MMA2 Airport**


After the domestic terminal of the Lagos Airport burnt down, a new domestic terminal was commissioned by the Federal Airports Authority of Nigeria (FAAN) in a public–private partnership (PPP) with Bi-Courtney Aviation Services (BASL) in 2003. BASL started managing the terminal in 2007. However, the government then questioned the duration of the agreement and refused partial payments, causing losses for the operator (Blueprint, 2014) (Fig. 4.22).

#### **Rationale Behind Inclusion**

See 4.21.

**Fig. 4.22** Lagos MMA2 Airport

## **4.23 Yenagoa International Cargo Airport**


Te Yenagoa International Cargo Airport project in Bayelsa State was initiated in 2012, inaugurated in September 2018 and opened in 2020. Te airport covers 2250 hectares of land with a 3.5 km runway and terminals, accommodates B747 aircraft and is ftted with Category II landing facilities for bad weather. Te airport is creating jobs and attracting investors to the state (SageTravels, 2019) (Fig. 4.23).

#### **Rationale Behind Inclusion**

Tis project provides evidence that a state government can successfully construct an international cargo airport.

**Fig. 4.23** Yenagoa Airport

## **4.24 Jigawa Airport Project**


Jigawa Airport was meant to become the perishable cargo hub in the region. One of the foreseen benefts of this project was signifcant enhancement of the income of farmers in the area, who would have access to international markets for their produce. It was also hoped to boost tourism in Jigawa State, as it was supposed to have the capacity to accommodate B747 aircraft with its 3.6 km runway.

Te project started in February 2014. Te Federal Civil Aviation Authority (FCAA) carried out an inspection of the warehousing, which found that the airport was poorly constructed, there were no passengers, the project was poorly conceived and airlines were not fying there since it was not commercially viable. Te airport is largely inactive, which is attributed by an unnamed civil servant to "misplaced priorities" (Ajakaiye, 2020) (Fig. 4.24).

#### **Rationale Behind Inclusion**

Tis project, unlike its successful paired project, failed in the hands of another state government.

**Fig. 4.24** Dutse Jigawa Airport

## **4.25 Tin Can Island Port**


Tin Can Island Port is a part of Apapa, the port for the city of Lagos (across from Lagos Harbour). Te Tin Can port terminal commenced construction in 1981 and was opened in 1997. In 1991 the Nigerian Port Authority became responsible for operating the port. In 2006, Tin Can Island merged with Roro Terminal when private terminal operators, Port and Terminal Multiservices Ltd (PTML), took over.

Tin Can Island Port is the second busiest port in Nigeria after Apapa Port. Te storage capacity of the silos is 28,000 metric tonnes of grain. Te terminal handles wheat, maize and malt, and it can take delivery of approximately 4000 metric tonnes of grain daily. Te facilities can handle ships of around 30,000 tonnes. Tere is also a grain bagging facility on-site (Fig. 4.25).

#### **Rationale Behind Inclusion**

Te same diferences are observed between completed and abandoned projects in the seaport sector as in the other sectors.

**Fig. 4.25** Tin Can Island Port

# **4.26 Calabar Seaport**


Calabar Port was notable for being central to trade with white businessmen. Te Old Port, as it is often called, was administered by diferent companies for many years until the Federal Government of Nigeria took over its operations in 1969.

In spite of its historical importance, the port has remained neglected. Calabar Port is faced with unique challenges.

Te bad road access into the port is one disincentive for shippers and business people when considering calling at the port. However, the dominant barrier to growth of the harbour (just like other ports in the region) is the inability of the government to dredge the channel (Salau, 2019). Te former Minister for Transport, Malam Idris Umar, once stated: "Dredging of the channel could transform the economy of the Niger Delta region. Te synergy between the Calabar Port, the Calabar Free Trade Zone, and Tinapa is valid. With the channel dredged, the increase in the volume of economic activities could be substantial and, of course, would transform and grow the maritime economy" (Fig. 4.26).

**Fig. 4.26** Calabar Sea Port Authority

## **4.27 Victoria Garden City (VGC) Housing Estate**


Victoria Garden City (VGC) Housing Estate was developed in the 1990s as one of the frst gated communities within the Lekki area. It is a high-end residential neighbourhood located along the Lekki-Epe Express Way. Its land area is 213 hectares and it sits beside the Lagos Lagoon. Te estate has reserved commercial regions separate from the residential feld, and the residential area is made up of serene boulevards. Te estate has a secure gated entrance and exit.

Most of the buildings in VGC are duplexes, and the uniform houses within the estate are prototypes built by the developer. Security in the area is generally tight. Within the estate are parks and playgrounds (enough space for children to express themselves). It is the right place for those who want to live in comfort, serenity and safety.

VGC was developed by HFP Engineering and then managed by VGC Estate Management Co (in which HFP has a substantial interest). HFP changed management under a management buyout and went intobankruptcy

**Fig. 4.27** Victoria Garden City

in 2019. When the data for this study was collected, the mother company was in receivership, looking for new investors (Fig. 4.27).

#### **Rationale Behind Inclusion**

Te same diferences are observed between completed and abandoned projects in the housing sector as in the other sectors (projects 4.27 and 4.28).

# **4.28 Festac Town Federal Housing Estate**


Festac Town Housing Estate (otherwise known as the Black Arts Festival Town) is situated along Badagry Express Way, Lagos, South West Nigeria. Te entire town will occupy, in its ultimate phase, an area of 1770 hectares and include seven residential communities of 15–20,000 people. Tus, the development will ultimately be able to accommodate a total number of 24,000 apartments, or around 120,000 people.

Te present development (Phase 1) commenced in 1974 and was completed by the end of 1976. Te construction of houses and various services was awarded to around 40 contractors in approximately 70 diferent sites of the project, while the infrastructure work was assigned to 14 major contractors.

However, the subsequent phases were never started. And, as a result of the neglect of Phase 1, most of the physical infrastructure of the once beautifully planned Festac Town is in a bad condition, the crime rate is increasing and social amenities are deteriorating. Tis is a marked departure from the original purpose and design of the village during its establishment in 1977 (Fig. 4.28).

#### **Rationale Behind Inclusion**

Te project is a contract to Victoria Garden City. Stakeholder interests were not as efectively considered, which ultimately went along with a deterioration of the project.

**Fig. 4.28** Festac Town Estate

## **4.29 1004 Housing Estate**


In preparation for handing over to the democratically elected civilian administration of President Shagari in 1979, the Military Government of General Obasanjo needed to address accommodation for federal legislators and their families, who were compelled by their election victory to relocate to Lagos (then the federal capital of Nigeria). Isaac Fola-Alade was contracted to design appropriate accommodation on the 11 hectares of land available (Fig. 4.29).

#### **Rationale Behind Inclusion**

Te project constructed six high-rise buildings, four clusters of residential multi-storey condominiums for families of senators and members of the House of Representatives, and four low-rise buildings with over a thousand apartments. Te estate opened in 1979, demonstrating that the government was already able to deliver successful housing projects to the public at that time. In contrast, it failed in Fig. 4.30, the Abuja Mass Federal Housing Project.

**Fig. 4.29** 1004 Housing Estate

**Fig. 4.30** Abuja Mass Federal Housing

## **4.30 Abuja Mass Federal Housing Project**


Te Federal Government of Nigeria entered in the year 2000 into a partnership with Zvecan and Wengfu to build the Abuja Mass Federal Housing Project under the Federal Integrated Staf Housing (FISH) programme. Te project was fnanced by the Federal Mortgage Bank of Nigeria, or FMBN. Construction has since commenced on the site but is currently abandoned. A memorandum of understanding (MoU) was signed by the contractors with the Ofce of the Head of the Civil Service of the Federation (OHCSF) for the of-take of the apartments upon completion. Te scheme seems to have failed its purpose of generally accessible housing (Abdullah & Aziz, 2013; Umoh, 2012) (Fig. 4.30).

See Fig. 4.29.

## **4.31 Olusegun Obasanjo Presidential Library**


Te Olusegun Obasanjo Presidential Library was conceived in 1988 to immortalize the president, and it was built after he started his second term as president of the Federal Republic of Nigeria. Te library was inspired by the US presidential library system and is the frst of its kind in Nigeria.

Te Library is owned by the former president of Nigeria and operates as a historic tourist centre with the ambition to also serve as a national archive for the preservation of documents and materials used by the president during his tenure and thus as an academic centre (Fig. 4.31).

#### **Rationale Behind Inclusion**

Te comparison of the two library projects demonstrates clearly the importance of having a clear design and purpose from the beginning, which does not change over the course of the project.

**Fig. 4.31** Olusegun Obasanjo Presidential Library

## **4.32 Abuja National Library**


Te contract for the library was awarded in 2006 to Reynolds Construction, a subsidiary of SBI International Holdings of Switzerland, with a plan to be completed within 22 months.

After 22 months, the project was scaled down from eight to fve foors (but its budget was scaled up with the approval of the Federal Executive Council), and the completion date moved back to July 2010. Just as the roofng engineers were about to move in October 2012, a directive from the presidency instructed RCC to revert to the original design of eight foors. In February 2013 RCC requested an extension and again sought an upward review of the budget. No major work has been done since then (Chris, 2021). Meanwhile, the National Library Department is continuing to serve the nation from a rented building with a leaky roof, cracked walls, and broken-down toilets and water pipes (Fig. 4.32).

**Fig. 4.32** Abuja National Library

See 4.31.

## **4.33 Nigerian Youth Empowerment Scheme (N-Power)**


Te Nigerian Youth Empowerment Scheme (N-Power) was set up in 2016 as an exploratory project of the Federal Government of Nigeria to support youth unemployment reduction and education by teaching and developing relevant work skills, which should also stimulate the economy overall. Modular programmes allow participants to customize content. Fifty thousand trained volunteers are being developed to cover gaps in public education services (Vanguard, 2017) (Fig. 4.33).

#### **Rationale Behind Inclusion**

Despite over a billion dollars being spent, unemployment increased from 10% to over 23%. Currently, N-Power is also a platform for diversifying the

**Fig. 4.33** N-Power Offces

economy. N-Power's objective is to prepare young Nigerians for a knowledge economy. Te mission is to create a pool of software developers, hardware service professionals, animators, graphic artists, building services professionals, artisans and more.

## **4.34 Nigeria Subsidy Reinvestment and Empowerment Programme (SURE-P)**


SURE-P is a scheme that was established during the Jonathan Administration in 2012, applying a part of the Federal Government's savings from the fuel subsidy removal in 2012 into job training and employment for unemployed graduates.

Te core of the programme was the provision of employment for unemployed graduates through internship programmes, creating a database of unemployed youth and reducing social vulnerability (Vanguard, 2014). SURE-P has been described as a project without a clear objective that did not disperse funds or did so in biased ways, and the leadership of the programme has also been criticized (CSJ, 2014) (Fig. 4.34).

#### **Rationale Behind Inclusion**

Te programme was limited in its impact by implementation issues (across states) that provide a contrast to the N-Power scheme.

## **4.35 Lagos State Waste Management Authority (LAWMA)**


LAWMA was established in 1991 (replacing its predecessor organization established in 1977) and is the frst waste management agency in West Africa.

**Fig. 4.34** SURE-P Offces

Its mission is to provide a professional, efcient and sustainable waste management and disposal service to Lagosian corporate bodies and governments (local and state) in Lagos State.

Before its establishment, waste management in a large commercial city like Lagos was a severe challenge for residents and the government. Lagos was ranked as one of the dirtiest cities in the country. Using a collaborative approach with all stakeholders, and introducing value-added services such as waste collection, recycling, receptacles, billing and service, Lagos State has become one of the cleanest cities in Nigeria (Obienyi, 2021) (Fig. 4.35).

**Fig. 4.35** LAWMA trucks

Te LAWMA agency has been installed successfully and has had impact, with ambition for more. Tis contrasts with project 4.36.

## **4.36 Cleaner Lagos Initiative (Visionscape)**


Visionscape is a public–private partnership with the Lagos State Government to provide waste management services for the Cleaner Lagos Initiative (CLI).

Visionscape has invested several millions of dollars in the purchase of cutting-edge technology and tools in a "24-hour waste management facility". However, the initiative suspended its operations after "a series of grave threats to the lives of its employees and destruction of its operational vehicles and equipment" in 2018 (Nairaland, 2018). No photo is available because the operation has become defunct (Fig. 4.36).

Te Visionscape project also had an excellent rationale but became a victim of hostile actions against it, in contrast to LAWMA in 4.35.

# **4.37 University College Teaching Hospital (UCH) Ibadan**


UCH Ibadan was authorized in 1952, started construction in 1954 and was inaugurated in 1956, in order to fll the need for the training of medical personnel and other health-care professionals for the country and the West African sub-region in the Medical Department of University College Ibadan, the frst university in Nigeria.

UCH started with 500 beds and 2 clinical departments, Medicine and Surgery. It has evolved to having more than 65 departments, among which is the frst Department of Nuclear Medicine in Nigeria. In addition, more than 200 examination couches have been added, with occupancy rates ranging from 65% to 70%. UCH performed the frst open-heart surgery in Nigeria, and its wide range of facilities, workforce and track documents have led to patronage by both national and international clientele (Oguntola, 2017) (Fig. 4.37).

#### **Rationale Behind Inclusion**

Te two hospitals 4.37 and 4.38 provide again a contrast between a project outcome that works (with admitted limitations) and one with a performance that invites severe criticism.

## **4.38 University of Abuja Teaching Hospital (UATH)**


Formerly known as Gwagwalada Specialist Hospital (founded in 1992), the hospital changed its name and became a subsidiary of the University of Abuja in 2013. However, it never reached its planned capacity of 500 beds or anything close even to the ofcially claimed 450 beds. Moreover, UATH has deteriorated over the years, with symptoms ranging from unavailability of basic medical equipment to patient complaints over treatment quality and service. Tis has prompted angry press reports that accuse the hospital of being "the gold standard of disguised incapacity" (Ugwu, 2017) (Fig. 4.38).

#### **Rationale Behind Inclusion**

See 4.37.

**Fig. 4.38** UATH Abuja

### **References**


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **5**

# **Insights from the Analysis of the Questionnaires**

Tis chapter presents the results of the econometric analysis of the questionnaire data. An econometric analysis identifes and interprets patterns in the data that we have collected. Te patterns allow identifying causal connections between actions that were taken in projects and project outcomes, namely completion (versus abandonment) and for the completed projects, schedule and cost performance. We present the fundamental logic of the analysis, including key results in a graphical form. We put technical content (related to the econometrics methods) into the Appendix of this chapter, so that readers who are not interested in the technical details can read this chapter and understand its critical implications, and readers who do want to check the rigour and care of the analysis can check.

As we explained in Chap. 2, we have data for 19 abandoned projects and 19 completed projects, each with 3 respondents—an owner, a supervisor (both civil servants) and a project manager of the main contractor. A total of 38 of 40 targeted projects represent a response rate of 95%. Tis gives us a total of 114 questionnaires to work with.

We frst examine the distributions of the responses. We show that the three respondent types indeed show "biases", or views of the project from "where they sit": owners evaluate diferently what went well and what did not; for example, a cost overrun that was absorbed by the contractor looks like a problem to the contractor but may not even register as important for the owner. We also check whether the responses actually difer across abandoned and completed projects: we fnd that they do, which means that our questionnaire variables capture something that is happening *diferently* across abandoned versus completed projects.

Ten, we "condense" the 41 variables to a smaller number of 4 "composite variables", which are called "factors" in the social sciences. We need to do this because each factor captures an underlying dimension of managerial diferences that is shared across a number of our variables; the shared dimension represents a common "essence" underlying several variables, of which each variable expresses a piece. (We also do not have enough data points to incorporate all 41 variables separately in a regression to obtain sharp results.) We then show that the four factors (in addition to corruption, the one variable that represents a dimension of its own) are able to statistically explain project completion with success. Finally, we show that the factors also successfully explain the budget and schedule performance of the 19 projects that were completed.

## **5.1 Variable Distributions and Variable Capability to Detect Differences Across Projects**

## **5.1.1 Each Respondent Type Adds Unique Perspectives and Information**

Let us frst compare the three diferent respondent types (owners, supervisors and contractors)—the comparison will give some indication of how diferent the information and views are that are expressed by the three respondent types (Table 5.1).

First, we see that the responses are positively correlated. A correlation of zero between two variables means that two have nothing to do with each other—they move independently from each other. A correlation of 1 means that the two variables move in unison (whenever one moves up or down, the other does the same), which means the two variables are the same (possibly scaled by a factor). A modest correlation of up to 0.5 means that the two variables are somewhat related (which is to be expected, as, after all, the three respondents do look at the same project), but they difer signifcantly.

As the three respondents reported on the same project, their responses should have some commonality—but is only moderate, so the three respondents emphasized in their own views the diferent characteristics of the project. For the completed projects, the two civil servants (owner and supervisor) agree more, with a correlation of 41%, but for the abandoned projects, the supervisor's response is as highly correlated with the contractor as it is with the owner (at a lower level of 30%).


Signifcance levels are indicated as \*\*\*\*:

*p* < 0.001; \*\*\*:

*p* <0.01; \*\*:

*p* < 0.05; \*:

*p* < 0.10


Now we examine how much the responses shift between completed and abandoned projects while distinguishing between the three respondents. Figure 5.1 shows the distributions of all answers by project outcome: across all answers, a higher score is "better"; therefore, a shift of distribution to the left means a shift towards—across all management aspects—"lower management performance". We see in Fig. 5.1 that for abandoned projects (right),

**Fig. 5.1** Response distributions by project outcome and respondent type

compared to completed projects (left), the means of the answers shift left (towards lower performance), and the standard deviations grow (the abandoned projects difer more among themselves in their evaluations than the completed projects). Te largest diference among projects is in the abandoned category for the supervisors—the standard deviation is the largest, and this is the only non-unimodal distribution.

Most interestingly, the evaluation shift from completed to abandoned projects is the largest for the supervisors: the mean shifts by 1.27 Likert points (versus only 0.9 and 0.83 for owners and contractors, respectively). We thus observe that the supervisor evaluations are the most sensitive to project outcomes. Specifcally, the mean responses are not statistically diferent across the three respondent types for completed projects, but among abandoned projects the responses difer statistically signifcantly across respondent types, and this is because supervisors lower their evaluations signifcantly more for abandoned projects than owners and contractors do.

Te diference could be caused by the supervisors being closest to the "mess" of the projects and perceiving the diferences in practices and actions more acutely than owners and (senior) contract personnel. On the other hand, the owners and contractors might be more reluctant to admit problems or articulate them. Indeed, the following observation provides some evidence of participants not wanting to talk about weaknesses despite seeing them: we had a private conversation with an experienced project manager who worked for a large, respected international contractor. Te person said, "If we were not speaking privately at this unobserved place, I would not be able to openly give you any information." Tis suggests that, in the questionnaire responses, the contractors, as well as the owners, may have been somewhat more guarded.

However, the key conclusion from this discussion is that the three respondents for the same project see signifcant diferences in their realities of this project. Each respondent brings unique perspectives and observations to the data. Terefore, we take this situation as a justifcation to treat the three questionnaires of one project as separate data points (each containing information of its own). Terefore, we perform the key analyses as if we had 38 X 3–114 data points, which allows us to identify more subtly patterns (we do check, however, several times whether looking only at one respondent type might invalidate the key patterns, which is not the case—we report this in the Appendix).

## **5.1.2 The Variables Capture Robust Differences Between Abandoned and Completed Projects**

Te next question is whether diferences between completed and abandoned projects were driven by a few variables, or whether the evaluations difered across many questions. In other words, were the diferences between completed and abandoned projects "concentrated" on a few variables? If this were the case, we would see evidence of focused weaknesses *or* of an inability by respondents to perceive diferences across the board. Tis is examined in the following t-test tables (Tables 5.2 and 5.3). Table 5.2 shows the diferences in supervisor responses across project outcomes (the respondent type with the largest distribution shift in Table 5.1), and Table 5.3 shows the diferences in contractor responses (the respondent type with the smallest distribution shift in Table 5.1).

Tables 5.2 and 5.3 tell us that the diferences between completed and abandoned projects are not focused on a few variables. To illustrate how the key patterns that we observe are robust across the respondent types, we, for now, still distinguish between them—Table 5.2 shows the variable diferences across abandoned and completed projects for supervisors, and Table 5.3 for contractors.

Moreover, even for the contractors, 29 out of 40 questions difer signifcantly (Table 5.3), although the contractors represent the tightest comparison, with their answers "guarded", as we saw in Fig. 5.1. Terefore, we can conclude that our questions captured systematic diferences between abandoned and completed projects and were indeed seen as diferent across the projects; diferences are observable not just across a few questions.

Importantly, even for the contractors, each of the three broad questionnaire areas (governance, initiation and execution) difers at the 1% signifcance level (bottom of Table 5.3). Almost every question difers statistically signifcantly between completed and abandoned projects for the supervisors (Table 5.2: the chances that the diferences between the responses for abandoned versus completed projects might have arisen "randomly" are below 5% for the vast majority of variables, as the last column indicates).


**Table 5.2** Two-sample t-test with unequal variances, supervisors

N = 19 abandoned projects and 19 completed projects. \* G13 (gratifcation) coding was reversed to "*absence* of gratifcation" to have the same directionality as the other questions ("more is better")

#### **100 J. Ibrahim et al.**


**Table 5.3** Two-sample t-test with unequal variances, contractors

N = 19 abandoned projects and 19 completed projects. \* G13 (gratifcation) coding was reversed to "*absence* of gratifcation" to have the same directionality as the other questions ("more is better")

## **5.2 Condensing Variables into Aggregated**  *Success Factors*

#### **5.2.1 Approach**

Examination of the data in the frst section of this chapter suggests two further steps. First, there are stable diferences in the perspectives between owners, supervisors and contractors, which refect genuine diferences in the information that they possessed and the observations they made. Terefore, it makes sense to treat each questionnaire as a separate data point—although three questionnaires have the same project as their subject, the three questionnaires are not simply redundant "duplications"; in fact, they contain complementary data. We therefore treat our data set as consisting of 114 responses.

Second, as explained earlier, groups of the 41 variables "are related" and "get at" the same underlying characteristic of how a project was managed. Te questionnaire started with three variable groups—governance, initiation and execution—and then multiple questions explored the areas. For example, questions G3–G9 all probe for a common "thing", namely how stable, informed and insightful the oversight committee was (e.g. supervision structure was … G3: stable; G4: regularly in action; G5: giving clear guidance; G6: giving clear approval; G7: kept informed; G8: meeting regularly; G9: examined by initial due diligence). Te reason for these "overlaps" is, of course, reliability of getting at the underlying concepts—a respondent may misinterpret or wrongly fll out a single question, but if we "get at" a managerial characteristic with multiple questions, there is a better chance that the responses will be stable and reliable.

In light of the fact that the questions were designed to have overlaps, for reasons of reliability, it makes sense to capture the underlying common (or "essential") management characteristics by "condensing" the variables. Tis is accomplished through a statistical approach known as factor analysis. In essence, it is an exercise in testing for commonalities among groups of variables. A factor is an unobserved underlying force, and each variable that is measured in the questionnaire is treated as if it were a linear combination of multiple underlying factors: where in our primary data table, each data point (each questionnaire) is represented by 41 numbers (values on the 41 variables), we now want to represent the questionnaire as a representation of a smaller number, n, of factors. We do not know a priori how many factors will emerge, so we let the data speak and see what factors emerge—we initially thought it might be three, which was why the questionnaire had three sections of governance, initiation and execution. However, when we rigorously searched for meaningful and statistically powerful factors, we found not three but four.

Te factor analysis was conducted with all variables except for "corruption", which was treated as a separate concept. Te rationale is that corruption does not fall under the managerial characteristics of the project; corruption is part of the project environment and is therefore in its own category.

## **5.2.2 Identifying the Factors**

In exploring diferent possible factor confgurations ("exploratory analysis"), we found that a four-factor model ofered the best balance between separating the variables well and having factors that successfully combined several variables and had a managerial meaning.

Te set of factors is meaningful: the factors cut across our "pre-named" categories (which stemmed from our review of previous work) of governance, initiation and execution. However, when we examine the variables that attach to each factor, there is a clear interpretation of each one, and we can give each factor a name that refects the variables that it combines (Table 5.4).

Specifcally, we conclude that the frst factor captures variables connected to contractor selection and qualifcation. Only G1, "defned supervision structure", is a surprise in this context, but it loads strongly, and it may capture that once a supervision committee was in place, a solid contractor selection (in contrast to, for example, a political selection) was enabled.

Te second factor connects strongly to variables relating to the project goals—business goals as well as societal goals. Te third factor collects variables that relate to resources (funding, personnel and logistics) and planning (stakeholders, timelines and risks). Te fourth factor captures elements of the supervision structure and stakeholder involvement. (Te reader might wonder whether it would be better to split this factor in two, one on supervision and one on stakeholders. However, it turned out that such a fve-factor solution was less statistically robust and had more cross-loadings; in other words, the data suggests that supervision and stakeholder management capability tended to go together.)



Note: Variable G2 was a descriptive variable and thus not relevant for the factor analysis. Variable E41 (quality of the risk plan) had to be dropped from the analysis because it cross-loaded across all factors

Tus, we have consolidated the 41 variables into 5 success factors that approximately summarize the larger number of variables in underlying success factors—contractor selection, project goals, resource provision and planning, governance and stakeholder management, and corruption (remember, this was treated separately, as an "external context" going into the analysis). We will now search for patterns of what explains project completion armed with these aggregated success drivers.

## **5.3 Econometric Prediction of Project Completion**

Armed with the aggregated success factors, or underlying management characteristics, we can now attempt to *detect causal patterns* that explain why projects were abandoned: we predict the probability of project completion in a logistical regression (a probit model)—completion is a zero-one variable, so we cannot use a normal linear regression with a continuous dependent variable. Te dependent variable in the regression is the logarithm of the probability of a project being completed (the formal specifcation is shown in Appendix 3 of this chapter).

We add one more variable into this logistical regression. Te reader may recall that we treat the three responses related to one project (owner, supervisor and contractor) as three diferent data points. We include a measure of how much the three respondents on one project disagree: if the three respondents disagree strongly, this may refect problems (for instance, in working together, in agreeing on plans or in agreeing on goals). For any of the variables, respondent disagreement is measured as follows:


Te set of analyses shown in Table 5.5 predicts the logarithm of the probability of project completion as the dependent variable, with the independent variables discussed earlier. Te coefcient related to each variable expresses how much the (log of the) completion probability changes if this success variable changes by a small amount (and the standard error of the coefcient expresses how much "noise" is in the data, and thus how reliable this coefcient is). If the standard error is much larger than the coefcient itself, then we cannot be sure whether this coefcient is really even diferent from zero, in other words, whether this variable even has an efect. Tis is also expressed by the statistical signifcance.

Table 5.5 gives us the frst core fnding of this chapter: the high rate of project abandonment in Nigeria is not mysterious. It can in fact be explained



Note: (McFadden's) Pseudo-R2 = 0.58; signifcance levels are indicated as \*\*\*\*: *p* < 0.001; \*\*\*: *p* <0.01; \*\*: *p* < 0.05; \*: *p* < 0.10

coeffcients

by the managerial characteristics of the projects: all four factors are strongly signifcant (at the 5% level or better), and their coefcients are of an equal order of magnitude, which means that no one factor dominates, but they all have important infuence. In addition, corruption is as important as each of the four managerial factors—this is not surprising, as corruption not only makes a project more expensive but also distorts decisions (as we will quantitatively show later). Finally, disagreement among the respondents (in their answers) is also a signifcant factor, as it captures the potential for tensions and misalignments among their actions.

All variables are statistically signifcant, being combined in one model, which implies that they measure diferent aspects of the project. Finally, the model ofers a level of explained variance of 58%. Tis suggests that the project characteristics that we have measured do not merely capture small infuences, but our variables together explain a large part of the probability of a project reaching completion or being abandoned during execution.

In order to examine the robustness of the model, we added an additional control variable: we counted how many times the president and thus the government changed during the life of a project (this varied between 0 and, for three projects, 12 times). Te idea behind this variable is that each government change carries with it the danger of disruption and discontinuity (as we will see amply illustrated in the case studies). However, this control variable is not statistically signifcant (neither alone nor when included together with the other variables), and we therefore do not show it in the reported tables. Te efect of discontinuity, while plausible, is so noisy that it cannot be reliably identifed in an econometric analysis.

Now we need to discuss the meaning of the parameters in Table 5.5, which represent a "model" that predicts the completion probability of a project depending on its scores of the factors and the corruption and disagreement variables. We show some elements of this model in graphical form in Fig. 5.2, *which shows by how much the completion probability changes if the two most infuential variables change by one score point up or down.* Te midpoint of the x-axis in the graph is the completion probability when all factors are at their average—it is 55%.1 Te two curves show how the completion probability changes when one variable changes while the other variables are held constant (we chose the two variables/factors with the largest and smallest regression

<sup>1</sup>Te average completion probability of our 38 projects is, of course, 50%, because that is how the sample was constructed. However, as our regression is not linear, the success probability of the average parameter values is not the same as the average success probability; it is slightly ofset.

**Fig. 5.2** Change in completion probability if factor score points change

parameter because they have the greatest efects; the efects of the other variables lie in between).

Te two curves in the graph demonstrate powerfully how large the efects of the variables are: if the corruption score can be reduced by *one score point* from its average (which is 4.89, in a range between 1 and 7). If corruption can be lowered to 3.89, the completion probability increases from 55% to 88%! If, in contrast, corruption deteriorates to a score of 5.89, the completion probability diminishes to 20%. We could not more powerfully confrm our previous prediction that corruption does not just increase project costs but may destroy the chances of completion at all. Te efect is literally huge—a 30% completion probability increase for a \$1B project translates into an expected cost of \$300M (assuming the whole budget is spent, which was indeed the case in our case studies)!

Similarly, a one-score-point improvement in the contractor selection score, from its average of 4.74 to 5.74, increases the probability of completion to 95%. Again, we could not demonstrate more powerfully the importance of contractor selection.

Tus, the econometric analysis is not a theoretical exercise of style; rather, it shows how incredibly important it is to manage the success variables that we have identifed and measured. Our data demonstrates that the efect of achieving even moderate improvements can be staggering.

In order to be sure that we are not biasing our results by treating the responses from the three respondent groups as separate data points, we carry out an additional set of analyses in Appendix 4. It examines how each of the three types of respondent explains the success of the project. Tis analysis uses the same variables as in Table 5.5, but without respondent disagreement (as we now look at only one respondent group). In this analysis, signifcance levels are lower because the number of data points in each regression is only one-third of the overall regression. However, the qualitative shape of the results stays robust across the three types of respondent.

## **5.4 Econometric Prediction of Cost and Schedule Overruns for Completed Projects**

Having shown that the variables measured in our questionnaire (consolidated into four success factors, plus the corruption measure), we now examine whether our variables can also predict schedule and cost performance for the set of completed projects. We conduct this examination using linear OLS (ordinary least square) regressions.

## **5.4.1 Effect of Variables on Budget Overruns**

Table 5.6 shows the regression results of how our variables predict cost overruns (measured as a percentage of budget, which normalizes the absolute budget size away).

As in the prediction of project completion, we again fnd that our (condensed) variables matter, all reducing budget overruns (the signs of their coeffcients are negative). All variables are statistically signifcant, and they explain not just some but a large fraction of the variance in the cost overrun performance measure (69% for the full model). Not only is the explained variance high, but the model overall is also highly statistically signifcant (the F-statistic for the model is *F* = 14.612. *p* < 0.001).

As in the prediction of project completion, the coefcients of the four factors (managerial characteristics) are a similar size. However, the coefcient for corruption is—at −33—four times the size of the coefcients of any of the managerial factors. Tis strengthens the fnding of the completion regression: corruption as an individual variable is very important, especially for the project's budget compliance—corruption directly infates the project budget, in addition to contributing to inefcient decision-making.

Interestingly, the respondent disagreement reduces budget overruns. Disagreement increases the chance of the project of being abandoned (Table 5.5), but given that the project was completed, disagreements among



respondents are associated with lower overruns. Te most plausible explanation of this is that given that the project was completed rather than abandoned, there is a "luxury of diferent views" associated with lower overruns: when the project goes badly (overruns are high), everyone has to agree that it goes badly. When the project is proceeding adequately ("it is OK"), things are possibly more ambiguous in the sense that people might disagree how well (or badly) things are going.

In order to test the robustness of the statistical results, we again added control variables: frst, the number of government changes during the life of the project (the same variable is in the project completion regression), and again, this variable turned out statistically insignifcant. Second, the initial *budget size* of the project was included (we could do this only in the regression with the completed projects as we did not have reliable total budget estimates for the abandoned projects). Te initial budget size is a measure of complexity and therefore project difculty, and one might expect that (percentage) overruns are worse for larger projects. However, this turns out to not be the case the budget size is (as for the government changes) statistically insignifcant. One interpretation is that all the projects in the sample are large enough to be difcult, and the forces that cause them to encounter difculties are not driven by size.

Similar to Fig. 5.2, Fig. 5.3 demonstrates that the variable efects are large enough to be of strong economic signifcance. Te average budget overrun of the 19 completed projects is 760% (of the overrun, as a percentage of the original budget). Tis drives home the point that "completed" is not the same as "successful"—an almost eight-fold overrun is not a great performance. However, not all projects had such large overruns, and the econometric model from Table 5.6 predicts that the budget performance can be greatly infuenced if the success factors can be changed.

Te two curves in the graph again powerfully demonstrate how large the efects of the variables are: if the corruption score can be reduced by 1 from its average of 4.4 (while holding the other variables unchanged), the overruns can be almost halved (however, if the corruption score deteriorates by 1, the overrun increases by almost 50% to 1100%). Reducing the budget overrun by half is worth \$370M, on average, over the 19 projects! If the contractor selection process score can be improved by 1 point, overruns diminish by twothirds, to just over 200% (but if the contractor selection deteriorates by 1 score point, the overrun almost doubles). Te impacts of the other variables are in between (closer to the contractor selection variable).

We again verify that these results across all three respondent groups are not caused by one (or dominated by one) respondent group only. We show the

**Fig. 5.3** Change in budget overruns if factor score points change

cost overrun regressions separately by respondent group in Appendix 5. Tis analysis shows that the results are representative and similar in each of the respondent groups, with slightly lower signifcance levels because of a smaller number of data points.

#### **5.4.2 Effect of Variables on Schedule Overruns**

Table 5.7 shows the regression results of how our variables predict schedule overruns (measured as a percentage of planned project duration). As for budget overruns, we again fnd that our (consolidated) variables matter, all reducing schedule overruns as well (the signs of all coefcients are negative). All variables are statistically signifcant, and they explain not just some but a large fraction of the variance in the cost overrun performance measure (49% for the full model). Not only is the explained variance high, but the model overall is also highly signifcant (the F-statistic for the model is *F* = 9.41 *p* < 0.05).

We again demonstrate the economic signifcance of our success drivers (factors and variables) in graphical form in Fig. 5.4. Te *average* schedule overrun among the 19 completed projects was 134% (of the originally planned duration). Te highest impact on the schedule lies in project goals and supervision (and we can see in Table 5.7 that the stakeholders' factor is almost as



Regression of schedule overruns (% of planned duration) for completed projects

**Fig. 5.4** Change in schedule overruns if factor score points change

important): if we could improve the project goals and supervision factor by 1 score point (from its average of 6, while holding the other variables constant), the schedule overrun would be reversed to a schedule *acceleration* of 50%!

Tis is, of course, not a "prediction" but an artefact of a linear extrapolation pushed further than is realistic. Once the schedule has been achieved, further improvements will not improve the schedule further, as the pressure to do so disappears. Whatever slack one has created will then be used to improve quality, reduce cost or increase proft. Tis limit of linear extrapolation is, of course, the reason why we show only "one-score-point changes" in the graphs in the frst place. However, the linear regression model still provides an estimation of how powerful the diference made by small improvements can be.

Interestingly, the schedule is less afected by contractor selection, resources and planning factors. Contractor selection has a dominant efect on budget adherence, as we have seen in Fig. 5.3 (after all, that's where prices are negotiated), but it does not dominate schedule adherence. Clearly, there is room to look for more fne-grained evidence of this in our case studies.

Moreover, corruption is much less important for schedule adherence—the schedule overrun varies "only" between 100% and 180% for a full two-point change in the corruption score around the average. Tis is instructive—it gives us tangible evidence that the corrosive efect of corruption lies in bad decisions that can derail a project, which we see in the completion probability graph in Fig. 5.2; and the corrosive efect lies in the budget—corruption directly costs money, as we have seen in Fig. 5.3.

(Te respondent disagreement variable has only a small efect, so we do not further discuss it here.)

Finally, we again verify that these results across all three respondent groups are not caused by one (or dominated by one) respondent group only. We show the schedule overrun regressions separately by respondent group in Appendix 6. Tis analysis shows that the results are representative and similar in each of the respondent groups, with slightly lower signifcance levels because of a smaller number of data points.

## **5.5 The Corrosive Effect of Corruption**

Tis chapter establishes an important basis for the conclusions that this book will reach. At frst, this study articulated a number of "project success factor" variables, entirely arising from the study of previous expert work on very large projects in other countries, without any consideration of Nigerian special circumstances, and certainly without any "partial interest" input from parties in Nigeria that may prefer certain conclusions over others. Tese variables were given to 114 professionals who have been actively working on Nigerian projects, but without any explanation of how which variable fts into a predicted framework of project success, and, moreover, ensuring diferent perspectives by asking respondents from owners and supervisors (civil servants), as well as contractors (employees of private companies). None of the respondents could "censor" their responses in order to infuence our fndings, because no one knew how the many managerial variables would turn out to have infuenced success. (We saw that respondents were possibly a bit more, or less, open in admitting the size of project weaknesses, but there was no "biasing" of our results; directionally, there was agreement.)

Because of this impossibility of external infuence on the outcomes of our examination, we can claim that our analysis is "objective"—it is in no way infuenced by any opinions of powerful parties who might have had an interest in the direction that our conclusions might take. No one, including ourselves, was able to predict which elements of the framework that we had assembled from previous project success studies in other countries would turn out to be the most important in the Nigerian public project context.

Tis is what our statistical analysis accomplishes: it identifes four managerial "characteristics" or "success factors" underlying, or "consolidating", our 41 variables: (1) the way the project goals were articulated and followed up, (2) the selection process of the contractor, (3) the way the project was resourced and planned, and (4) the way a supervision structure was set up and obeyed and stakeholders were taken into account. A critical additional success factor was the absence (or presence) of corruption (a single variable in the questionnaire), which was as important for a project's completion as any of the other factors. Finally, we saw that disagreements in the responses among the three respondent groups captured some types of underlying miscommunication, or possibly tensions and misalignment, and it therefore also predicted lower project success.

Our statistical analysis strongly demonstrates that all six drivers matter, not only for project completion but also for budget and schedule adherence in those projects that were completed. Tese fndings imply that project success in Nigeria is not mysterious but analysable and understandable, and improvements can be identifed and put in place.

One limitation of statistical analysis is that the variables it uses are aggregated and therefore somewhat abstract. In addition, the causal interactions between the four managerial characteristics do not appear in the econometrics: for instance, if the project were not planned well, resources may not be stably and sustainably allocated. Tis, in turn, disturbs the way the contractors behave—they may walk out at some point or play games in order to cushion their budgets so they do not go bankrupt when funding is disrupted. Tese interactions will become fully apparent only when we look at the projects in more narrative detail.

However, one causal interaction that we *can* examine econometrically is the efect of corruption on the decisions in the project. In order to do this, we include not only corruption in the project completion regression, but also an *interaction term*, the *product* of *(Factor x) X (Corruption index)*. If this product is signifcant in the regression, this means that the efect of Factor x will be changed (get larger or smaller) as the extent of corruption changes; in other words, corruption has an efect on efectiveness of other managerial decisions—this is precisely the "corrosive efect" of corruption that we have previously mentioned.

In the completion probability regression, the "corrosive efects" of corruption are not detectable; in other words, corruption directly reduces the completion chance of a project but does not infuence the efects of the other variables. However, the interactions *are* econometrically visible in the cost overrun regression for the completed projects. Te result is reported in Table 5.8. Because of the small size of the data set, we could not simply add the interactions into the full regression without losing signifcance; instead,


**Table 5.8** Regression of the effects of interactions between corruption and other variables on cost overruns (% of planned duration) for completed projects

Note: signifcance levels are indicated as \*\*\*\*: *p* < 0.001; \*\*\*: *p* <0.01; \*\*: *p* < 0.05, \*: *p* < 0.10

the table elaborates elements of Table 5.6, showing each factor and its interaction with corruption one at a time.

As in Table 5.6, the coefcients of the factors are negative, which means that increasing the index of, for instance, contractor selection *reduces* the predicted amount of budget overrun. In contrast, the coefcients of corruption (in each partial regression) are positive, which means that an increase in the index of corruption *increases* the predicted budget overrun.

Te focus of this table is the coefcient of the interaction term (Factor x) X (corruption index). Tis coefcient is positive (and signifcant) in all four partial regressions. Tis coefcient means that if the corruption index increases, then the budget overrun increases, and thus the overrun-reducing efect of the factor is weakened. In other words, increasing corruption weakens the budget-overrun-reducing efects of contractor selection, project goals, resources and planning, and supervision and stakeholder relations. Tis is graphically illustrated in Fig. 5.5, which adds the interaction to the main efects of Fig. 5.2: an increase in corruption (by one point) fattens the regression coefcient, and thus the slope of the regression curve, of contractor selection—it becomes less efective.

Tis illustrates that the corrosive efect of corruption on the important project decisions and practices can be econometrically measured—as we discussed in the overview of existing knowledge in Chap. 2, corruption does not "merely" infate budgets but weakens the efectiveness of project management practices throughout the project.

**Fig. 5.5** Corruption through interaction weakens contractor selection effectiveness

Tis analysis has illustrated how we can quantitatively demonstrate the corrosive efect of corruption. However, the observation is still valid that econometric analysis is somewhat abstract and does not directly demonstrate *how* the success factors and corruption afect other decisions and project outcomes. Te next step in our study is therefore the assembly of 11 case studies: detailed narratives that illustrate what it looks like when budget continuity is not assured, when stakeholders are ignored, when project goals are not articulated and accepted by the public, or when the choice of contractor is not made professionally, based on track record and competence; moreover, the causal interactions among the managerial success drivers will become apparent in the case studies.

Te next chapters will in this way connect the econometric results with life on the ground. Ten, we will be in a position to identify the core reasons for large public project failure in Nigeria; and, once we have identifed the core reasons, we can try to ofer sensible and practical recommendations.

## **Appendix 1 Correlations Among Independent Variables Across All 114 Responses**

Tis appendix contains the customary correlations table, which shows that the variables are only weakly or moderately correlated.


**Table 5.9**Variable correlations


Tere are a number of moderate correlations; for example, G1, the existence of a well-defned supervision structure, is correlated with a number of positive outcomes. Te highest correlation is between E39 (a realistic timeline) and I25 (budget risk scenarios), with value of 0.663. In other words, the variables are diferent and not just repetitions of one another.

## **Appendix 2 Factor Analysis**

Suppose for now that we have identifed *n = 3* factors. Tus, the realization of variable *i* (*i* runs from 1 to 41, as we have 41 variables) for questionnaire *j* (*j* runs from 1 to 114, as we have 114 questionnaires), *xij,* becomes:

> Variable realization *x f ij k i* <sup>1</sup> *k kj ij* 3 .

Te factor analysis algorithm chooses a set of (3 × 114) numbers that minimize the "error", *εij*, or the deviation from the actual collected numbers caused by representing the data with a smaller number of three new underlying variables. Te hope is to fnd factors where each of the variables is indeed infuenced only by a coefcient, *αik,* belonging to *one* factor, which then "represents" several variables—if each variable were equally infuenced by all factors, we would not be able to condense the regression analysis. Te factor analysis approach has two steps:


Te factor analysis was implemented through a family of statistical techniques known as structural equation modelling (SEM). SEM is widely used in social science research and analyses the structural relationship between the measured variables (the 41 items shown above) and the underlying (latent) constructs. Tis method is powerful because it estimates the multiple and interrelated dependence across variables and latent factors in a single analysis. Te exploratory and confrmatory factor analysis was conducted using the *sem* package in R. Te probit analysis was conducted using the *glm* package in R. A number of statistical tests was performed in order to ensure robustness of the factor analysis and the regressions.

Tis four-factor solution was validated through confrmatory factor analysis. Table 5.10 shows the fnal factor loadings, rather than just showing which variable was explained by the factors in Table 5.4 in the body of this chapter. Te reader may remember that factor analysis pretends that each variable is a linear combination of the underlying factors, as shown above in the equation. A "factor loading" then represents the coefcient *αik* in the earlier equation, which connects this variable to each factor (normalized such that each variable's factor loadings add up to 1).

Ideally, we want to have each variable represented by only one factor (i.e. all the bold numbers in the table above are 1, and all the non-bold numbers are 0), which would mean that four variable groups were each perfectly "summarized" by one factor. Tis does not work, of course, because real-life data is never that clean, and it would imply that the multiple variables in each group are all the "same". Tey are not, however, as each one captures a separate "favour" of the underlying factor and is therefore not the same (but the factor "abstracts" these favour diferences away).

Nonetheless, if the variables are indiscriminately determined by all factors, then the "variable consolidation" does not work because the factors do not "group" multiple variables into underlying characteristics. As a rule of thumb, if a variable has a loading of above 0.7 on one factor (which means that its loading on other factors must be low), then it is viewed as strongly expressing this factor. Table 5.4 shows that the fnal factor loadings from the confrmatory factor analysis are very strong indeed.

Tis factor model is statistically robust (summary statistics are shown above) and has strong factor loadings. A factor model is weak if many variables attach to more than one factor and thus do not strongly represent one "underlying management characteristic". However, in this model, few variables attach to more than one factor; "cross-factor loadings" are few, and they are not very strong (only one variable, E41 = risk plan quality, touched upon all factors and had to be taken out). Terefore, we can conclude that this set of factors is robust.


**Table 5.10** Variable loadings in the four-factor model

Notes

Bold numbers represent core loadings to the "assigned" factor. Highlighted numbers represent cross-loadings of > 0.25

Variable G2 was a descriptive variable and thus not relevant for the factor analysis. Variable E41 (quality of the risk plan) had to be dropped from the analysis because it cross-loaded across all factors

## **Appendix 3 Specifcation of the Logistical Regression**

As the outcomes are binary (completed or abandoned), we use a probit model based on the assumption that *Prob(Y=1) =* Φ*(XT β)*, where *Y* is the vector of outcomes (0 s or 1 s corresponding to abandonment or completion), *X* is the vector of independent variables (the factor scores), *β* is the vector of coefcients, which are the parameters to be estimated, and Φ is the cumulative standard normal distribution. We then estimate the log likelihood function:

$$\ln \mathcal{L}\left(\boldsymbol{\beta}; Y, X\right) = \sum\_{i=1}^{n} \left( \mathbf{y}\_i \ln \boldsymbol{\Phi}\left(\boldsymbol{\chi}^{\prime}, \boldsymbol{\beta}\right) + \left(1 - \mathbf{y}\_i\right) \ln \left(1 - \boldsymbol{\Phi}\left(\boldsymbol{\chi}^{\prime}, \boldsymbol{\beta}\right)\right) \right)$$

Logarithms of the likelihood variable are taken in order to turn the product of independent variables into a sum, to which a regression can be applied. If the value of an independent variable changes, it then infuences (according to the regression) the logarithm of the probability of the project being completed.

## **Appendix 4 The Logistical Completion Probability Regression by Respondent Group**

Te three respondent-specifc regressions are shown next to one another in Table 5.11.

Te contractor regression adds a twist by including the size of the project as an additional variable (which implies that the larger the project gets, the more contractors struggle). Te overall levels of explained variance are lower, because one variable is missing (namely, the disagreement among respondents), and signifcance levels are lower because the data points in each regression are only one-third of the overall regression (as Table 5.12, Factor 2 illustrates). However, the qualitative shape of the results stays robust across the three types of respondent, as demonstrated again by the size of the coefcients of the independent variables being compared.

Because of the lower signifcance levels, due to smaller numbers of data points, each factor is not statistically signifcant for each respondent group in Table 5.10. However, each factor is signifcant at least for two respondent groups, so the overall conclusion remains robust that all four factors matter.


**Table 5.11** *Probit* regressions of the probability of project completion, by respondent group

Note: signifcance levels are indicated as \*\*\*\*: *p* < 0.001; \*\*\*: *p* <0.01; \*\*: *p* < 0.05; \*: *p* < 0.10

**Table 5.12** *Probit* regressions of the completion probability, comparison of signifcance levels across respondent groups


## **Appendix 5 Robustness Analysis: Cost Overrun Regressions by Respondent Group**


**Table 5.13** Cost overruns for owners

Note: signifcance levels are indicated as \*\*\*\*: *p* < 0.001; \*\*\*: *p* <0.01; \*\*: *p* < 0.05; \*: *p* < 0.10



## **Appendix 6 Robustness Analysis: Schedule Overrun Regressions by Respondent Group**


**Table 5.15** Cost overruns for contractors

Note: signifcance levels are indicated as \*\*\*\*: *p* < 0.001; \*\*\*: *p* <0.01; \*\*: *p* < 0.05; \*: *p* < 0.10





Note: signifcance levels are indicated as \*\*\*\*: *p* < 0.001; \*\*\*: *p* <0.01; \*\*: *p* < 0.05; \*: *p* < 0.10



#### **128 J. Ibrahim et al.**



Note: signifcance levels are indicated as \*\*\*\*: *p* < 0.001; \*\*\*: *p* <0.01; \*\*: *p* < 0.05; \*: *p* < 0.10

**Table 5.20** Comparison of signifcance levels for schedule overruns across respondent groups


Note: signifcance levels are indicated as \*\*\*\*: *p* < 0.001; \*\*\*: *p* <0.01; \*\*: *p* < 0.05; \*: *p* < 0.10

**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

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# **6**

# **Two Library Projects**

We now analyse two major library construction projects: frst, the National Library project, which was commenced in 2006 under President Obasanjo (whose term expired in 2007), using government funding; despite millions of dollars being spent, only a shell of a building was standing in 2020. Second, we look at the private Olusegun Obasanjo Presidential Library, which was begun in 2002 and completed in 2006–2007; it was funded through private donations.

# **6.1 The National Library of Nigeria in Abuja: An Abandoned Project**

## **6.1.1 Project Initiation**

A concept long discussed (UNESCO, 1954) and advised by the Ford Foundation in 1960 the idea of a national library was fnally legislatively enacted in 1970 (National Library Act, 1970; Agidee, 1970; Ekpe, 1979). Over the years, through this Act, 37 libraries have been established around Nigeria as part of the National Library project. A library system was seen as signifcant to the national development goals of education and informationsharing, new skill acquisition, innovation and strategic thinking (Aguolu, 1989; Meraz, 2002).

However, the crowning achievement was seen as being the construction and implementation of a national library building. Prior to this building, the national library was housed in an ofce located in a rented apartment in Abuja, in a building in a poor state of repair, unft for the importance of this institution. A shabby apartment was hardly the place for Nigeria to showcase its leadership in African education; nor was it capable of supporting an evolution of sophistication and services. Te national library was to be "the reservoir of the intellectual memory of the Nigerian Nation". It would represent a metric of successful state development plans and the stage of development. In the words of a minister of education of Nigeria, as "a giant of Africa" Nigeria wanted to build a national library of the very highest standard in Africa, showcasing Nigeria's leadership in education. Te building would house the "national reference library", the centre where, according to the National Library Act, mandatory registration of all publications and issuance of the ISBN and ISSN numbers for the publication of books and journals took place (Akintude & Selbar, 1995; Gill et al., 2001).

In 2006 it was fnally determined that the time had come, and a legislative group convinced President Obasanjo to sign the bill authorizing construction. In response to the wishes of the stakeholders (the educational establishment), a 13-storey building design was adopted because, according to the minister of education in 2019, its size represented a performance indicator used to measure a nation: other comparable countries had libraries on a similar scale, including Ethiopia, Kenya and South Africa, and Nigeria should be no diferent. After the president signed the act, this large project could proceed.

## **6.1.2 Contract Signature and Execution**

A contract for a 13-storey national library was awarded to Messrs Reynolds Construction Company (RCC), for the sum of N8B (US\$61M), with a completion schedule of 22 months. Te choice of contractor followed a process, which was (in addition to the qualifcations of the contractor) rated positively in our questionnaire by the respondent representing the high-level civil service that had "project ownership". However, the questionnaire respondent who represented the part of the civil service responsible for project oversight rated both the contractor award process and the contractor's qualifcations poorly—this discrepancy does not prove that the award process was a failure, but it clearly refects that the project supervisors had great difculty managing the contractor's behaviour and the project progress.

By the time President Obasanjo stepped down from ofce, little progress had been made, with only the construction of foundations complete. In interviews, we were given hints that corruption was partially to blame, forcing

RCC to pay money at every stage in order to make progress. Tis meant that the contractor had insufcient funds to achieve completion within the contract without making a loss. However, this is not formally stated anywhere it is, in efect, "hearsay"—because it has been impossible throughout the process to get anyone to make ofcial statements about corruption.

In 2007 President Obasanjo left ofce. Te president immediately succeeding him was known not to be in favour of this project. Moreover, this was a period characterized by austerity measures, "when we had to cut our coat according to our size". Terefore, it was decided to reduce the number of foors from 13 to 5, so that "we could fnish it quickly because we were not sure of the sustainable funding". Tis decision was taken not by the Federal Executive Council but by the Ministry, and it echoed the fact that projects did not have dedicated funding (for their life cycle), so managers had to repeatedly approach the Budget Ofce and the National Assembly to approve a budget for the year. Funding could dry up on the basis of budget cuts and shortfalls driven by other (non-project-related) issues. (As an aside, the decision also seemed to generate points with the (new) president.)

Although the project was scaled down from 13 to 5 foors, ironically its budget was scaled up after protracted negotiations with the contractor, who claimed that they had run out of funds and could not achieve completion. By the time a new contract had been settled, another two years had passed, and the contract sum had increased by 120% to \$137M; the completion period also changed to 21 months, beginning in July 2010.

After two years, construction work progressed to the ffth foor, with only the roofng left to be completed. However, just as the roofng engineers were about to move into the project site, another directive came from the (again new, as President Yar'Adua had died and President Jonathan had come in) presidency via a letter dated 11 October 2012, which was sent to the consultant to instruct RCC to revert to an amended design of eight foors. In February 2013 RCC requested another extension and again sought an upward review of the contract.

No major work has been done since then. Te National Library Department continues to occupy a rented building with a leaky roof, cracked walls, and old toilets and water pipes. Te building is an unfnished shell, as shown in Fig. 6.1. Since 2013 the contractor has allegedly been charging a daily fee for pieces of equipment left on the site for over seven years.

A letter by the Education Ministry, dated 9 July 2019, entitled "National Library of Nigeria Headquarters Project, Abuja: Submission of Revised Estimated Total Cost (RETC)", indicated a disparity of \$20M (between

**Fig. 6.1** The National Library Building in Abuja in 2019, with fve foors

the government estimate for completion of the National Library Project and the contractor's demand for project completion). Te letter also detailed an argument between the contractor and the Nigerian government, which had ofered the contractor the net sum of \$120M to return to the site to complete the project. However, the contractor insisted on being paid \$180M.

## **6.1.3 Conclusion**

It was evident from our interviews that there was a desire to correct and revive the abandoned project, but doing so was made difcult by the lack of funding, the risk of litigation and a lack of planning. Developments in modern technology also reduce the need for a library of this nature—and thus the need for another \$190M in the face of other urgent demands. Some stakeholders interviewed argued that rather than spending another \$180M on the National Library, the fund should improve the Nigerian university libraries.

## **6.2 Olusegun Obasanjo Presidential Library: A Completed Project**

#### **6.2.1 Project Initiation**

Te concept of a presidential library was conceived by President Obasanjo in 1988, and the bulk of construction took place during his second term in ofce, between 2002 and 2007 (although it was not ofcially dedicated and opened until 2017, see BBC, 2017).

President Franklin D. Roosevelt oversaw the creation of the frst presidential library in the USA in 1939—something that has now become standard practice in the USA. Te idea behind these buildings is to keep presidential documents for the historical record and for the development of the national archive (Ginsberg, 2010). Te Obasanjo library is the frst of its kind in Nigeria, and, in the same spirit, it is not just a library. It is an extensive museum of Nigerian history (with an emphasis on Obasanjo's role in that history), housing over 16 million documents and 3.5 million books, several historical pictures and over 4000 artefacts explaining the trajectory of Olusegun Obasanjo and his two-term stints in power, both as military and civilian president of Nigeria. Te library sits on 32 hectares of land in the Abeokuta Ogun State of Nigeria, and it includes a 1000-seat auditorium and 153 rooms with recreational facilities, as well as an amusement park (Akinwande, 2019).

Private donors funded the presidential library project, and by way of acknowledgement, their names are engraved at the entrance of the library. However, critics have alleged that these donations were made when President Obasanjo was serving as the president of the Federal Republic of Nigeria, when he had the power to "arm-twist" donors.

#### **6.2.2 Project Execution and Outcome**

Te execution of the project took place closely overseen and supported by the project owner, the president himself, which conferred the ability to overcome obstacles. Not even the sudden death of the head of the leading project contractor, MD (a family frm), could stop the project. President Obasanjo convinced the contractor's management team to keep all the workers in place, purchased the necessary materials and made a cash payment of 10% of the project cost to pay the staf salary, which enabled the project to continue.

In addition, the project sufered from cost overruns driven by increasing costs of procurement arising from infation and the cost of foreign exchange (many material parts of the projects were imported). Te fnal numbers refected the fact that the project was certainly not problem-free—the budget overran by 100%, and the fnal project dedication happened eight years later than originally planned. However, it was completed and is now in operation (Fig. 6.2).

Te library's ofcial brochure states its value to the community: "At a more local level the library will teach children and young adults the essential concepts of leadership and citizenship through the example of a former president. By upholding the critical worth of good governance, the exhibitions should inspire future leaders of Nigeria." Furthermore, some stakeholders have commended the presidential library project as a good initiative that will assist knowledge and intellectual capabilities developed using the archive of presidential documents. Indeed, a subsequent president, President Jonathan, is also planning a presidential library (on a smaller scale).

However, other stakeholders have criticized President Obasanjo's library on the basis that it is a colossal waste of money. Tey have argued that a private presidential library ofers no insights into the national development of a developing country. Questions have also been raised about how to fnance the library in the future, given that it is *not* self-sustaining. Stakeholders have argued that the library could be donated by President Obasanjo to the Nigerian government.

**Fig. 6.2** Olusegun Obasanjo Presidential Library

#### **6.2.3 The Difference Between the Two Projects: In the Words of Former President Obasanjo**

Te case studies invite interpretations of the sources of the two libraries' different fates. We had a chance to listen to President Obasanjo regarding his view of the diferences, since he was in charge of both projects (at least at the outset). He suggested that there were three "diferences" between the two projects, which resulted in their completion and abandonment, respectively (citations are taken from Jimoh 2021: 104):


## **References**


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **7**

# **Two Bridge Projects**

Infrastructure development is a critical driver of any economy. In a developing country such as Nigeria, it is central to the improvement of national development, especially roads and bridges that expand networks, reduce transportation bottlenecks, enable investment opportunities and connect (ethnic) communities. Tis chapter presents two major bridge projects. Te frst is the Second Niger Bridge, started under President Jonathan in 2013 and with a completion date of 2017, which, at the time of writing (2021), is still only 17% complete, with more than a billion dollars having been spent on it. Te second is the Tird Mainland Bridge, started in 1977 under the civilian Shagari government and sitting as fragments after he was ousted in 1983, which was fnally completed under President Babangida (the last military president) in 1990, at a cost of \$1.1B, and is currently a major trafc artery carrying a million vehicles per day.

## **7.1 The Second Niger Bridge: A Stalled Project**

## **7.1.1 Project Initiation**

Te Second Niger Bridge was conceived to widen trafc capacity in addition to the old First Niger Bridge at Onitsha (which had been built in 1965 and caused structural stability concerns because of excessive loads). Te Second Niger Bridge was frst proposed by the Shagari government at the end of the 1970s as a critical link to the communities in the South-East and South-South of Nigeria. But the project was never materially pursued until, before his election, President Goodluck Jonathan announced (to general applause) his intention to fnally build the bridge; indeed, he promised at an Onitsha town hall meeting on 30 August 2012 that "he would go into exile if he did not deliver on the project by 2015" (Wikipedia, 2020).

Te Jonathan Administration committed \$850K to the planning and design of the bridge, but it took until 2015 for work on the project to begin. Te project was announced as a public–private partnership (PPP) involving a consortium between Julius Berger and the motorways investment company of the Nigeria Sovereign Investment Authority (NSIA), based on a design, fnance, build, operate and transfer (DFBOT) model that would cost US\$653M, with the federal government contributing US\$150M, while the consortium would raise the rest of the funds. Te government established a "Presidential Infrastructure Development Fund (PIDF)", from which it would fnance the project (Olisah, 2020).

President Jonathan explained this as follows. "We designed a funding model bringing in the private sector, arranging with Julius Berger. And we set up a sovereign wealth fund. With the sovereign wealth fund, we could fund projects with government budgeting and in collaboration with Julius Berger. It was a tripartite arrangement, so the funding was through the public–private partnership (PPP), with seed loans from the sovereign wealth fund. Te frst money that we used was from the sovereign national wealth fund for that project."

However, the language that was used publicly about the PPP was slightly misleading. What President Jonathan meant by a "PPP model" was a tripartite arrangement of collaboration between the government, the private sector and the contractor (on the fnancial model) to deliver the project. It was not the case that the contractor would ever fund the project or run it upon completion. Tere was no fnancial plan in place beyond an intention that the private sector would bring in the funds, and the contractor was meant to work with this assumption and start the project. In the meantime, the government went to the sovereign wealth fund and pulled out \$150M (and more later). Te hope was that this would inspire the private sector to invest and the contractor to bring equipment to the project site and commence work. President Jonathan's words were, "We designed a funding model bringing in the private sector, arranging with Julius Berger …," but this meant getting the contractor started using the money from the sovereign wealth fund. Indeed, it was not that the government had the funds to complete the project, but rather that the private sector would soon come to fund the project.

President Jonathan stood for re-election in 2015 but was unsuccessful, being beaten by President Muhammadu Buhari (who had been a military government president in the 1980s). Te Buhari Administration cancelled the

**Fig. 7.1** The Second Niger Bridge at 17% completion in 2021

contract in August 2015 (Jide, 2015). Tis was when the real trouble started. Again, President Jonathan commented: "Unfortunately, I laid the foundation stone very close to the election period. People were complaining, but we did not care. (…) Te fnancial model for the Second Niger Bridge was very good, but political reasons got in the way. We play politics with everything in Africa. I am saying this to impress it upon you. In this country, we face a severe issue of successive government continuity with good projects."

Te project was expected to be completed in 2017. Te bridge construction work stopped for 31 months, and the project has not moved beyond 17% of construction (although the completion status is a matter of opinion, as we will see below, see Fig. 7.1). It has already cost the Nigerian government more than a billion dollars.

#### **7.1.2 Contract Disputes and Recontracting**

Tere was some public discussion about who the bridge would beneft most among the three regions the bridge would connect. Public commentary stressed, "Te Second Niger Bridge is not an Igbo Bridge. Te South-East cannot claim ownership of the bridge more than Delta and Edo States." However, this somewhat tense public discussion did not result in a loss of public support for the project; on the contrary, as the project stalled, representatives from all three regions called for its continuation.

Te Buhari Administration (at least publicly) supported the project, prompting comments in the press: "But interestingly, this vision has been sustained by the Buhari government" (*Business Day,* 2020). However, the public terminology of a PPP consortium was stopped. Indeed, the PPP structure was accused of "failing to perform" (*Vanguard*, 2020), and the Infrastructure Concession Regulatory Commission (ICRC) expressed concerns about the cost of the project, the toll fees to be charged under the public–private partnership (PPP) and the design, build, fnance, operate and transfer (DBFOT) model. Moreover, it cited issues relating to the compensation to be paid to the host communities located along the proposed bridge.

Te government redefned the project as government-owned and funded. Its spokespersons commented: "Te government is now funding the project. Te PPP model wasn't working, and that was why construction work on the project stalled for a while. So, in order to make progress, the government decided to take it up, as well as [to] make budgetary provision for it (…). Te era of PPP is over and it is fully funded by the government this time." In answer to the question about whether the government had the funds to continue with the project, the controller said, "Of course, the government has the funds. Why are you afraid about whether government has the funds or not? Te federal government has decided to fund the bridge and we are happy to see that" (Okechukwu, 2018).

Interestingly (and supporting our interpretation that it was not the contractor who failed to deliver), the project was awarded to the same contractor, namely Julius Berger Nigeria, which had also (successfully) built the Tird Mainland Bridge. Te diference was that a local contractor was added to the main contractor, Reynolds Construction Company (RCC; the contractor who had won the contract for the abandoned library project), replacing NSIA, which had been part of the original consortium. Te contract sum was \$541M (N206B) (*NAN*, 2020a).

## **7.1.3 Continued Stalling**

Even after being rewarded the contract, Julius Berger left the site because of a lack of funding from the federal government. Te press commented: "A crosssection of citizens has cautioned that the appropriate thing should be done by expeditiously releasing funds and not starving the project of funds to make it a reality" (Amaize et al., 2018). A parliamentary committee expressed concerns about the "slow pace of work, [and that] there is no way that President Buhari will commission the Second Niger Bridge during his tenure". However, the committee blamed the contractor for "showing its unft and unprofessional behavior in the way it has handled these projects"; it also accused Julius Berger of irregularities in securing the contract—that there was no due procurement process (NAN 18 July 2020a).

Te Buhari Administration continued to pay lip service to the project, and the president visited the site multiple times. After talk of the work being 33% complete, in October 2020 President Buhari said that "the Second Niger Bridge has attained a 46% completion status" (NAN 8 October 2020b); in addition, Mr Fashola, the Minister of Works and Housing, said on television that the government had committed to completing the bridge by the frst quarter of 2022.

However, the authors observe that little progress has been made at the time of writing (early 2021; see Fig. 7.2); indeed, concern is being publicly expressed that the bridge will not be completed even after Buhari's second term (*Vanguard,* 2020). Moreover, the government budget simply has no room for the large mobilization of funds that would be necessary to go from a 46% completion status to full completion: the Nigerian government's total capital project budget for 2021 is insufcient to complete the project by 2022. Nigeria's application for funding of other projects, such as the Electricity Transmission Network and Infrastructure, at \$486M, is still pending at the

**Fig. 7.2** Second Niger Bridge work in process in 2021

World Bank. Another application to the World Bank by the Buhari Administration in the amount of \$1.5B, to fnance recurrent expenditure for the 2020 budget, is being given slow consideration but is subject to reform by the Nigerian government. Tus, it is not clear where the fnancing for the bridge will come from, and we must therefore conclude that the aforementioned hopeful announcements represent political statements rather than being based in truth.

### **7.1.4 Diagnosis of the Reasons for Failure, in the Words of (Former) President Jonathan**

President Jonathan was accused of not being serious in his intentions: "In 2015, Jonathan used the project as a campaign tool, assuring Nigerians that while the old Azikiwe (Nnamdi) built the First Niger Bridge, the young Azikiwe (himself) would build the second. Unfortunately, Jonathan did not win the election for his second term" (*Business Day*, 2020).

Te authors had the opportunity to interview President Jonathan and asked why the bridge project had not been completed on schedule and why the 31-month delay had not been prevented? At frst, President Jonathan said that even though Dr Ngozi Okonjo-Iweala, Coordinating Minister of the Economy and Minister of Finance, came from Anambra State (one of the states that the bridge would connect), this showcasing of the importance of the bridge to her and the people of Anambra State was not enough to get the project done. (Te implication was that somehow this might have been her fault.) We probed further and uncovered the real issues, according to the president.

In his words, "I am telling you from the state level to the federal level there are people who initiate programmes and projects without funding. You want to gain some political points by telling people, 'We are doing this for you. Mr President, Mr Governor, we are doing this for you.' But if you go to the minister in charge of works or fnance and say, please, how do you intend to fund this project, they will begin to tell you how Mr President thinks we should do the project and they have no choice. Nobody will show you the project's fnancial plan, and these are signifcant reasons why major projects failed in this country" (Jimoh, 2021: 110).

Tus, the project again illustrates (as with the National Library in Abuja) the lack of fnancial plans for large government projects in Nigeria. Te Second Niger Bridge lacked fnancial planning; it was merely initiated, in President Jonathan's words, "You just want to gain some political points by telling people we are doing this for you." Tus, from the outset, scheduled completion was not a priority. President Jonathan suggests that for project success in Nigeria, "You must have a fnancial model for payment, and if you want to borrow, you must have a repayment plan. When you don't design a payment model, you may not execute that project. A president can wake up in the morning and award one project of, say, N3B [\$8M]. Yet, once the president moves up to N35B [\$90M] and above, this is where the fnancial model must come in or the project will fail" (Jimoh, 2021: 110).

#### **7.1.5 Conclusion**

Tis project had been long in the making and ofered large benefts to the Nigerian nation, given the number of states that the bridge would connect. President Jonathan had a strong rationale for starting the project. However, the project became a political pawn: frst, as an election play for him (used at the "last minute") and then in the refusal by the Buhari Administration to continue the project (perhaps understandable in light of the missing fnancing, but in contrast to their lip service). Te lack of continuity is already emerging as a continuous theme.

Te second continuous theme is the lack of stable funding (which is also visible in the library projects). President Jonathan announced the set-up of a PPP consortium based on a sovereign wealth fund, which did not quite describe the fnancing situation or put in place a solid fnancing model that would enable the project to be completed. Tis construction was then dismantled by the Buhari Administration, and a lack of funding stability again caused work to stop.

Finally, when the project is fought over and undermined by its owners (the various government branches), frst, the contractor is put in a difcult situation, being denied the stability of engagement that is necessary to make investments and to dedicate resources, and second, the contractor then faces hard-to-resist temptations to game the project, hide budgets and obtain profits by any means (which we again saw in the library projects, on the positive and negative sides).

Te Buhari Administration says it is not interested in the PPP funding models used by some other countries. Could there be another political game going on with the bridge? Nonetheless, the contractor is not visibly moving the project forwards, and diferent parties claim diferent completion levels (as mentioned earlier). President Jonathan regretted the ongoing political game with the Second Niger Bridge, but it was a game of his own making.

# **7.2 The Third Mainland Bridge: A Completed Project**

## **7.2.1 Introduction**

Tree main bridges connect the mainland to the island in Lagos State in Nigeria. Tey are the Eko, Carter and Mainland bridges. Of the three, the Tird Mainland Bridge has the longest span, at 11.8 km (Fig. 7.3). Te bridge connects both the Oworonshoki and Apapa-Oshodi Express Ways while running through to the Ibadan Express Road from Lagos. President Ibrahim Babangida's Administration completed the construction of the bridge in 1990. For a long time, it was the longest bridge in Africa, carrying over a million vehicles per day.

## **7.2.2 Starting and Stalling**

Te project was commenced in 1977, under the military government of President Obasanjo, with a goal of completion in 1980. Obasanjo resigned in 1979 and handed power over (for the frst time in Nigeria's short history) to a

**Fig. 7.3** The 11.8 km Third Mainland Bridge at Adekunle Junction

civilian administration under Shehu Shagari. Te project continued, and its frst phase (5 km, ending at an exit at Ebute-Metta) was completed in 1980, but at this point the project stopped progressing.

Te Shagari government was ousted by a coup in 1983, which led to another military government under General Buhari. Te project stopped under the new administration. Widespread dissatisfaction with Buhari's restrictive governance led to another coup, after which General Ibrahim Babangida (who had also played an active role in the coup of 1983) became the new president in 1985 (*Encyclopedia Britannica*, 2020). In 1986 President Babangida announced that he would return power to a civilian government in 1990, a transition that fnally took place in 1993 after some complications (such as an attempted coup by a Muslim Major from the North in 1990 and the relocation of the country's capital from Lagos to Abuja, in the centre of the country in 1991). Te handover of power was complicated, as Babangida annulled the elections; fnally, under pressure, he handed power over to a civilian interim government under the businessman Ernest Shonekan. In the midst of these tumultuous events, President Babangida picked up the Tird Mainland Bridge project again and led it to completion by 1990.

#### **7.2.3 Restarting the Project Under President Babangida**

Te authors had the chance to interview (former) President Babangida in early 2020, who explained the reason behind his decision to fnish the bridge and what infuenced him. We cross-checked this for accuracy with some of the senior government ofcials (the project owner) and the contractor involved in the project (Jimoh, 2021: 112):

*I will tell you a story. In 1982–1983 I was watching the show* 48 Hours *on American television. Tey said in the programme that Nigeria was a country of riches, and I watched that programme to the end. I think Okonjo Iweala, or someone, talked about projects in Africa and Nigeria called "White Elephant Projects". So, they went on the bridge and said this is one of the classic examples of building fantasy projects and showed the bridge that ended in the middle of the water. Tat stayed with me, even when I came into ofce, and I always had it on my mind.*

*Ten, in 1983, the Shagari government was toppled, and unfortunately he did not have enough time, so he could not have done anything about the bridge at that time. So, when we came in, it came back to me that there was a challenge that I had no option other than to face. We had to do something about it to prove the cynics wrong, a challenge that we must tackle with determination to prove to some people that Nigeria could solve problems.*

*Now, I had a very talented young man who was the military governor of Lagos. I also had a lot of talented engineers. So, I told the governor, we need to talk about the bridge, and I asked, is it doable? Can we do it now? He said, yes, we can do it. So, I told him you should get the people who have worked on such projects before, such as Julius Berger Company or Melaf Mark Anthony Construction Company. He went out to mobilize the contractors. Te contractor worked out the job with its engineers, and they found out that the job could be executed.*

*I called the contractors and told them: "Look, I want this bridge to become a reality." I told them, "I am not interested in the technical details, because I am not a technical man, but get me this bridge, and I assure you, we will be able to pay the money." I also got them to make a promise: "I will come back here on my birthday, promise me, give me this as my birthday present." And the contractors promised me they would provide me with the project. And that went well.*

Tus, this project had an owner who knew what he wanted, and a professional contractor handled the bridge. However, other principles of megaproject management were not followed—there was no contract bid for a mega project of this nature, as is normally the case, no stakeholder engagement and no proper government monitoring department. President Ibrahim Babangida was not interested in detail—the contract was awarded for \$1B (fnally running to £1.1B), and we do not know how the computation was done. Te contract sum was higher than what many people considered appropriate for the remaining work, and some stakeholders made a case of alleged corruption. We asked President Babangida whether corruption was an element in the project (as some had claimed). He confrmed, "Yes. People could think that since the amount involved is enormous at one billion dollars."

Te design was what the contractor deemed suitable for the bridge. And, as "God will have it", the project was completed on time; at least, as the president said, "Give me this as my birthday present." Te project emerged from the president's desk. Tere was no approval process beyond President Babangida.

#### **7.2.4 Project Execution and Outcome**

Some stakeholders argued that President Babangida knew what he wanted from the bridge even before he became president. He did not hide his intention to complete a bridge; it was not a "White Elephant Project" that ended in the middle of the water.

Te project fle confrms the involvement of the Federal Ministry of Works, and some of the ministry ofcials participated in the survey that was conducted. Still, the ministry could do little to infuence the contractor's interest because of the fear of the military government. For instance, nothing could be done in terms of contract negotiation. Te project owner's quality of representation was not particularly strong in the feld, beyond the military president's ofce, and the president confrmed that he had "a lot of talented engineers". Ministry ofcials beyond the president's ofce played a very weak oversight role. Te contractor was having a feld day in every respect (on due process in contractor selection, see Von Branconi and Loch, 2004; Olatunji, 2008).

During the contract execution stage, the subcontractor arrangement (by the main contractor) seemed efective, as was the management of the supply chain, and there was clarity of problem-escalation procedures. One example of this occurred when the bridge was to be extended to Yaba/Oyingo and the contractor felt this was not part of the project. Te supervising ministry staf and the minister of works brought this to the president's attention, and the section was ultimately included. Te Army also protected the military government on a daily basis. All other stakeholders were powerless and could not mount any reasonable engagement in the project's life cycle for fear of the military.

In the end, there is clear evidence that a quality global standard project was delivered on schedule and with little cost overrun. Te bridge is an economic success. Tere is, however, criticism—some stakeholders cite Lagos State's masterplan, which renders the nation-building role of the Tird Mainland Bridge dependent on the completion of the Fourth Mainland Bridge, which it was promised would be built by President Babangida but which was not tackled during the eight years he was in ofce.

#### **7.2.5 Conclusion**

Tis case is representative of the approach of "heroic leadership" of powerful decision-makers (in many cases, the presidents themselves) who tried to accomplish signifcant improvements for their country (which, in this case, worked) but neglected their own limitations (in knowledge and decisionmaking) and the impacts of their "lonely" (personal with little consultation) decisions on continuity.

Te "rescue" of the Tird Mainland Bridge is one case of a dominant leader getting his way, cajoling the project contractor to deliver project management with efective collaboration—with a generous price and the application of power later on to deliver. It is not that there is weak leadership of mega projects in Nigeria; on the contrary, there are "Über-Leaders", who fll an institutional vacuum with "lonely" (and sometimes wise but sometimes illinformed) decisions.

Te anecdote of President Babangida and the Tird Mainland Bridge shows both the strengths and weaknesses of a project management system with weak institutions—powerful leaders (who often had good intentions!) could move mountains and accomplish things. Te lack of continuity meant that the project was initially in a bad state, but Babangida was able to overcome this discontinuity and fnish the project within his term.

On the other hand, leaders do not always get it right and they make mistakes. Babangida picked up on the Tird Mainland Bridge by accident, quite "randomly". What if he had not watched the critical television show? Would the project have continued to languish? Or, might he have discovered a diferent languishing project that was even more important than the Tird Mainland Bridge? As successful as this project rescue was, was it the right project to choose? Te complexity of the economic benefts of multiple large government projects is too great for leaders acting on a whim to choose the right priorities, regardless of how powerful they are. Even if they are able to push their choices through, this does not mean they are the best choices for the nation that they are trying to build.

## **References**


https://guardian.ng/news/2nd-niger-bridge-other-road-projects-reps-committeefrowns-at-slow-pace-of-work/


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **8**

# **Two Power Plants**

Te completion of the Egbin Power Station in 1985 teaches the lesson that the successful construction of a power plant in Nigeria is possible if there is not much external interference. Te second case, the Calabar Power Station, is just one part of a large project to build ten power plants in gas-producing states in Nigeria. After 13 years (instead of the planned 4), seven of the ten plants have been constructed, but they produce only a fraction of the foreseen power for the country. Te systemic nature of power generation, distribution and sales was not taken into account, with very negative consequences.

## **8.1 Egbin Power Station, Ikorodu Lagos State: A Completed Project**

## **8.1.1 Initiation and Completion**

Egbin Power Station is the largest power-generating station in Nigeria, with an installed capacity of 1320 MW, consisting of six units of 220 MW each. Te station is located at Ijede/Egbin, in Ikorodu, approximately 40 km northeast of Lagos.

Te project was designed and decided under the Shagari government in June 1980, with construction work starting in 1982 by the Marubeni Consortium, which used the Hitachi Company of Japan for the electrical and mechanical work and Bouygues of France for the civil works. Te budget was \$250M and the targeted completion was May 1985. It was the frst gas-fred plant in Africa, with six independent 220 MW-capacity boiler turbine units. It is still the largest power plant in Nigeria (Wikipedia, 2020).

Two military coups intervened, the frst resulting in the military government of President Muhammadu Buhari in 1983. However, the new government continued with the plant, with the frst unit being completed and commissioned on 13 May 1985 by the president. Te other fve units were commissioned at six-month intervals until May 1987 by President Ibrahim Babangida (who had taken over from Buhari in the summer of 1985 following another military coup).

Tus, the project was two years late overall (a 40% schedule delay), and the fnal cost ran to \$690M, a budget overrun of 176%. So, the project had some challenges, but it can be called a success, in spite of two regime changes over its duration (Fig. 8.1).

## **8.1.2 Success Conditions and Challenges**

Why was Egbin successfully completed in the face of (painful) government turnovers, while other projects had succumbed to disappearing support and budgets when the political leadership changed? No ofcial statements or press articles are available, as this project happened too long ago, but the authors were able to interview two government ofcials.

Te project enjoyed overwhelming support from the government, as well as the population—it was obvious that (the capital at the time) Lagos needed a large amount of electric power. A town was resettled, without any protests, in

**Fig. 8.1** The Egbin Power Station

contrast to the Zungeru Hydropower Plant, which we discuss in Chap. 10. Te population supported both projects, but in 1982 it still trusted the government more than it did in 2015, when the dam was built. Te government fnanced the project from its own budget, which was less strained in 1982 than later on. Tus, the subsequent governments continued to support the project. Finally, the command structures in the military governments were stricter, and the government held the monopoly on power generation and distribution—once there was a consensus at the top, the projects happened.

Te project also benefted from good collaboration with the contractor, Marubeni. A former member of the Egbin management team commented that the contractor had good technology, "did what it took" and even came back after the project was fnished to check whether things were going well. In addition, the design factored in signifcant robustness by oversizing both the boilers and the turbines.

Te project had its challenges, as large projects often do. For example, the power lines over the lagoon into Lagos posed engineering challenges. Te gas pipeline was not completed when the frst unit was commissioned, delaying the actual start. Furthermore, the HPFO (high pour fuel unit), which enabled the plant to run on fuel as back-up when necessary, was delivered by ship from Port Harcourt in the South. However, the ship did not ft under a bridge in Lagos, so the unit had to be delivered on trucks via roads, which caused a long delay. Ultimately, the project was delivered with reasonable overruns (in the context of large government projects in Nigeria), enabled by functioning governance.

#### **8.1.3 Privatization and Trouble**

On 1 November 2013 the federal government (under the Jonathan Administration) privatized the power plant, following a World Bank/IMFencouraged privatization programme of public companies that had begun under President Obasanjo. Egbin Power Station became a joint venture between Sahara Power Group and KEPCO, which purchased a 70% holding for \$407M.

However, the plant then experienced losses, because the transmission grid was kept under government ownership and received no investment, rendering it unable to transport the electricity generated. Moreover, the distributors regularly did not pay the government's wholesale energy trader, which in turn did not pay the power generators (*Te Economist*, 2016)—in 2017 Egbin was owed \$350M and could neither invest nor raise funds. It therefore shut down for a period and ran far below capacity for a long time before being refurbished (Power Links, 2017). Tese market failures have plagued all power plants in Nigeria, including the Calabar Power Station, which we will discuss next.

## **8.2 The Calabar Odukpani Power Station: Completed but with Little Delivery**

## **8.2.1 Project Initiation**

Te Odukpani power plant near Calabar City (from now on referred to as Calabar Power Station) was to be one of ten power plants that would comprise the Nigerian National Integrated Power Project (NIPP). Te NIPP initiative was conceived in 2004 under the administration of President Obasanjo, with the aim of addressing the issues of insufcient electric power generation and excessive gas faring from oil exploration in the Niger Delta region. Te concept of NIPP was to add a medium-sized gas-using power station to each gas-producing state in the Niger Delta (using the otherwise fared gas), resulting by 2008 in an addition of 10,000 MW to the national grid's 1500 MW in 2000 (Power Sector Nigeria, 2012). Te original NIPP concept foresaw seven plants, which was reduced to six because one state was already far advanced with one (where the government had promised to invest half). However, then four other plants were added, on which construction had begun, so the fnal NIPP initiative included ten plants (personal interview with a power ministry executive). Calabar Power Station was one of the ten.

A new organization, the Niger Delta Power Holding Company (NDPHC), was created as a special-purpose vehicle to manage this project. Te funding plan for the NIPP was to source a foreign loan and afterwards sell an 80% stake of the completed power plants to private investors, who would operate them efciently and proftably, in order to recover the investment. In August 2005 the National Council of State and the National Assembly approved an initial \$2.5B for the NIPP from the "Excess Crude Oil Account". Te power plants were originally estimated to cost around \$200M each (around \$2.2B for the ten plants, plus the additional one, where the government would add fnancing) and were planned to be completed by 2008.

By 2007 (when the government changed), approximately \$2.8B had been spent on advance payments (Okedu et al., 2018), including \$1.78B in funded letters of credit, which allowed some of the projects to continue despite the funding interruption that was about to strike.

Te change in administration after the election in 2007 (to the government of President Yar'Adua) interrupted funding for more than two years as the new administration subjected the project to rigorous legal, fnancial and political reviews.

#### **8.2.2 Project Complications and Delays**

At the outset, seven plants were planned to be built with simple cycle designs (of lower efciency), but they had provisions for future extension to a (more efcient) combined cycle operation. Together, the seven plants were to operate 22 GE 9E gas turbines, with a nominal rating of 126 MW, which delivered a net capacity of 112.5 MW after adjustment for site conditions (the Calabar Power Station was to house 5 of the 22 turbines). Te Calabar project was given to the Marubeni Corporation (Japan) and Gitto Group (Nigeria) contractors.

After the two-year interruption resulting from the new government's scrutiny, additional delays accumulated. Te project was expanded to include power transmission lines and sub-stations, as well as gas pipelines from the sources to the plants. However, the NDPHC stated that the pipelines had been disrupted by vandalism in the Niger Delta, in addition to wider community hostility. Te minister of power told the media about a host community in Delta State, which demanded a huge sum of money—far more than the cost of the power project—for the community in order to appease their ancestral deities before cutting down a tree that was standing on the right of way of the power plant near the deities' shrine (Power Sector Nigeria, 2012). Also, there were delays arising from engineering equipment being ordered from abroad and delivered much later.

In late 2009 President Yar'Adua fell severely ill and left the country for treatment, but he died upon his return in February 2010. Vice President Jonathan, who had been the chairman of NDPHC, ex ofcio, became acting president and then—after winning the election in 2011—president, so the NDPHC changed leadership. By 2012 the emerging picture was that as a result of the added scope (transmission and gas pipelines) and the various delays sufered by the projects, they had consumed over \$8B, with only 4774 MW of the planned 10,000 MW being built (Advisory Power Team, 2015).

On the other hand, there was optimism in 2012 because the Nigerian Electricity Regulatory Commission (NERC) authorized state and local governments, as well as communities in the country, to generate and distribute their own electricity. With this authorization, the Cross Rivers State Government (where Calabar was situated) started a move to generate and distribute electricity in its domain, with an N30B (around \$80M) investment plan. Te state's commissioner for power, Augustine Nwokocha, told the press: "Te state will generate enough capacity, have a robust transmission infrastructure that will take the power to the people and have a solid distribution infrastructure that will take it to their routes."

## **8.2.3 Delivery of the Calabar Power Station in 2015**

Te source of gas for the Odukpani power station was planned to be the Addax Adanga oil and gas feld, approximately 100 km ofshore from Oron. Te Calabar project included the engineering, procurement and construction of a pipeline from Ikot Nyong to Oron to Adanga. However, when the project was revived in 2011, following the federal government's suspension and investigation, it was discovered that Addax had no plan to develop the gas resources of the Adanga feld. Te planned gas supply evaporated and had to be replaced.

An alternative gas supply from Frontier Oil's Uquo gas-processing plant was contracted. Following all due process, a new, shorter pipeline was contracted for the supply of 131M cubic feet of gas per year. Te supplier Accugas claimed to have invested \$600M in building gas-production, processing and transportation infrastructure, with third-party fnancing to supply gas to the Odukpani power station.

At the end of May 2015 (outgoing) President Goodluck Jonathan inaugurated—with much fanfare—three new gas-fred power plants, including the 560 MW Calabar project, out of the ten projects fast-tracked by the NIPP framework (Patel, 2015). However, in the end the gas supply at Calabar was not ready. Not only had there been the aforementioned gas pipeline vandalism prior to the April 2015 elections, but the Accugas (formerly "Frontier Oil") pipeline was simply not fnished. Te Calabar plant had all the equipment installed, but it could not operate because of a lack of gas to burn (Fig. 8.2).

A provisional gas supply from Obigbo/Imo River was arranged and delivered through the completed segment of the pipeline. Te supply could only sustain two units—not the fve that had been installed. It was put into service in 2015 but could deliver only 220 MW.

**Fig. 8.2** The Calabar Power Plant in 2021

(In parallel, the Cross Rivers State Government attempted to build a smaller plant of 23 MW of electricity for the supply of the City of Calabar. However, this power plant was shut down one day after the power station was commissioned in 2019 because of fears over its reliability.)

## **8.2.4 What Has Been Delivered? Lessons from the Project**

For the 10 NIPP power plants, the original cost estimates were approximately \$2.2B, including pipelines, switchyards and connections to the grid. However, the estimate is that more than \$8B have been spent. Te result of this investment consists of the following (in January 2021): seven completed and functional power plants (including Calabar); one completed but with a design downgrading from combined cycle operation to the simpler and less efcient open cycle; and two that are close to completion but not fnished.

Tis project is evidently heavily over budget (not untypical for very large projects) but nevertheless complete! Te problem is that delivery outcomes have been severely below the design plans: the 7.5 "completed" plants deliver—instead of a capacity generation of 3000 MW (which is already a reduction by half in terms of the goals announced by Obasanjo in 2004)—only 1300 MW, around 30–40%, to the grid. Te reasons for this lie in a combination of both problematic supply and delivery capacity (Ali, 2016).

At Calabar Power Station, these limitations take the following two forms (interview with a senior power ministry ofcial). Te frst problem exists on the demand/distribution side. Calabar's parent NDPHC sells the electricity to the Nigeria Bulk Electricity Trader (NBET), which sells to various (privatized) distribution companies. However, the distribution companies have not paid their bills—they cover only about 40% of the price that Calabar Power Station ofcially charges—arguing that they need to invest capital to upgrade their equipment, that the tarifs they are allowed to charge are too low and that Nigerian electricity customers do not pay their bills (*Te Economist*, 2016). Terefore, the government is forced to subsidize all electricity generated by Calabar to the tune of 60%, which is paid from the annual budget and represents a signifcant drain. In addition, the decrepit national power grid, which leaks power to a high degree, cannot receive the full output from the Calabar plant and therefore limits the operation of the plant to a maximum of 337 MW, corresponding to only three of the fve units ever being in operation at the same time.

Te second problem exists on the supply side. Te Gas Sales Agreement (GSA) with Accugas has a feature that, in hindsight, was an error—it has a fxed "take or pay" piece that requires the power plant to pay at least for the gas volume that would run four of the fve generation units, even if the amount really taken up is smaller. In other words, although Calabar Power Station never has more than three generation units in operation, it always pays for an amount of gas corresponding to four units. Tis causes a signifcant additional loss. Te GSA with Accugas is backed by a World Bank Partial Risk Guarantee (an insurance scheme that was introduced by the World Bank to Nigeria), which obliges the federal government to make up for supply losses. Te problem is that this risk guarantee was designed for extraordinary situations (occasional and catastrophic risks), but it is used here for a systemic constantly operating loss. Tis second steady loss is payable by the federal government and draining nationwide public resources.

In summary, Calabar Power Station produces electricity but at a huge loss to the government, which begs the question about whether this generation has any positive productivity for the electricity grid (and this is also the case in light of the very large investment that was made to get the plant operating in the frst place).

Te fnal assessment of this project acknowledges that a power plant has been built (one of 7.5), but without taking into account that this plant is a component of a larger system, namely, the grid and the players generating, trading and distributing electric power. Te component within this system, frst, contributes only weakly to the system, at a fraction of its theoretical capacity (because the system is so fawed that it cannot even use the capacity of the plant); and, second, it is causing a large and systemic loss to the government. Te national funds used here produced an asset, but they nevertheless ended up being squandered.

## **References**


Federal Ministry of Information. Archived 4 March 2013 at the Way back Machine. Niger Delta Power Holding Company Limited.


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **9**

# **Two Express Road Rehabilitation Projects**

Te comparison between the Lagos-Ibadan Express Road and the Lagos-Badagry Express Road involves two projects of similar size and complexity. Both roads had fallen into substantial disrepair, limiting economic usage and transit and risking the safety of drivers and vehicles using the roadways.

Te two projects allow us to look at the attempts of two diferent contracting regimes: the frst to make a public–private partnership (PPP) work, and the second the usual public project construction from the outset. Te PPP scheme failed, and yet the Lagos-Ibadan Express Road is complete (or almost complete), whereas there is still no end in sight for the Lagos-Badagry Express Road. Examining the reasons for the problems is instructive for our enquiry.

## **9.1 The Lagos-Ibadan Express Road Rehabilitation: A Completed Project**

## **9.1.1 Original Construction of the Express Road**

Te Lagos-Ibadan Express Road is a 127.6 km-long expressway connecting Ibadan, the capital of Oyo State, and Lagos, Nigeria's largest city. President Olusegun Obasanjo's Administration constructed the express road in 1978 when he was the military head of state of the Federal Republic of Nigeria. It was Nigeria's frst multi-lane express route.

Te road maintenance was handed over to the Federal Roads Maintenance Agency of Nigeria, (FERMA), which had just been established and was responsible for connecting roads between states in Nigeria; it also had the role of improvement, maintenance and construction of new road networks. Road maintenance in Nigeria is subject to annual budgetary appropriation by the federal government and the vagaries thereof.

Te road was ofcially opened to trafc on 8 August 1978. In September serious pavement failure occurred in the form of cracks, potholes, deformations, pushings and ruttings. As a result, an investigation was carried out to determine the causes of failure, the adequacy of pavement design and the quality of the materials used, both in the failed and functioning sections of the road. Te results showed the causes of failure to be heavy axle loads, a lack of sub-soil drainage and the use of sub-standard materials (Ibrahim, 1981). Tus, the efects of gouging and corruption were felt almost from day one of the economic usage of this very important economic artery.

## **9.1.2 A Reconstruction Project in a PPP Scheme**

Tirty years later, repairs and improvements to the road, as well as the provision of additional lanes, were long overdue (Fig. 9.1). In 2009 President Umaru Musa Yar'Adua developed a government policy for PPP schemes to

**Fig. 9.1** Lagos-Ibadan Express Road before the habilitation contract

help engage the private sector in funding road constructions. Te Yar'Adua Administration signed a PPP agreement with construction company Bi-Courtney Highway Services, based on construction costs of \$593M, to be executed over four years, with a concession period of 25 years. (Tere was also a bus rapid transit [BRT] scheme, with a separate lane in each direction alongside the expressway, which was to be delivered by Lagos State Government. Tis side project created its own problems, but for reasons of space we will not elaborate on this separate project here.)

However, the construction failed to take of. Under the contract, the government expectation was that at least the sum of N86.5B (\$227M in the 2020 exchange rate) would be spent by Bi-Courtney, but by 2012 not much had happened. While the PPP arrangement remained unexecuted, the expressway was a source of grave hardship to travellers, with a resultant loss of productivity from long travel times, in addition to a loss of lives and property through vehicle accidents and robbery, among other things (Elebiju & Ilesanmi, 2020). Bi-Courtney said the delay in executing the concession came from a government delay in the approval process of the project design.

In 2012 President Jonathan cancelled the concessionary agreement with Bi-Courtney. In November Mike Onolememen, Nigerian Minister of Works, announced revocation of the agreement. A government investigation judged the concession of the Lagos-Ibadan Express Road a failure: several things had been taken for granted by both government and the concessionaire. Te government ofcials did not have enough knowledge about PPP schemes and they failed to employ the services of experienced legal/transaction consultants or technical advisers. Tus, the design of the project was left entirely to the concessionaire, who drew up an agreement that was skewed in its favour—the result was structured to fail from the outset (Ahmed, 2011).

However, a Bi-Courtney company representative emphasized in an interview with us that the delays had been caused by the behaviour of the government: frst, the Ministry of Works delayed the approval of the road project from the agreed 6 months to 18 months, accounting for a whole year of delay. Second, the investor (who would take the PPP concession) wanted certain guarantees, such as being paid back in dollars, not naira, and getting some assurances about minimum levels of toll income. Te government, however, refused to give commitments, while demanding a design change with more lanes, which the investors resisted because trafc predictions did not justify the extra lanes. Te apparent "non-work" was a result of these frustrating deadlocks. In the end a fnal decision meeting between Bi-Courtney and the Ministry of Works was repeatedly delayed because one ministry ofcial after another refused to chair the meeting; eventually, President Jonathan decided the delay was unacceptable and simply revoked the concession.

Bi-Courtney challenged the decision in court and managed to secure a court injunction restraining a new concession agreement, which was fnally rejected in court only in 2016 (*Te Nation*, 2016). Te subsequent administration under President Buhari also criticized Jonathan's government for cancellation of the contract. Te Minister of Works, Housing and Power, Fashola, said during an interview: "Te past government did not act in good faith (…). Te answer is no cancellation if the contract is performing. What to do is renegotiation. I am not saying that the government must not terminate nonperforming contracts. Indeed, these are rights that are standardly provided in all well-drawn contracts" (Jimoh, 2021: 118). In other words, the subsequent government alluded that a negotiation should have been attempted with Bi-Courtney in order to avoid failure of the PPP scheme. (However, this criticism needs to be interpreted in light of the hostility against PPP schemes, which the Buhari government itself exhibited in the context of the Second Niger Bridge project.)

## **9.1.3 Restructuring the Project as a Government-Owned Project**

Te President Jonathan Administration, after revocation of the concessionary agreement, awarded the contract for rehabilitation of the road to Julius Berger Nigeria and Reynolds Construction Company Limited, for the sum of N167B (then \$801M, and in 2020's exchange rate \$440M). On 8 July Mike Onolememen, Minister of Works, announced that the two frms had emerged as the preferred bidders and would deliver the road within 48 months (by 2017); also that the ministry had obtained the certifcate of "No Objection" from the Bureau of Public Procurement (BPP) (*Te Nation*, 2013).

However, the running of the road reconstruction as a public project brought back the all-too-familiar problem of unreliable funding. Funding was intermittent, and the contractors were not paid. Construction slowed and then stopped when 2016 brought a walkout.

In June the Minister of Power, Works and Housing, Babatunde Fashola, presented to the House of Representatives' Investigative Committee on Breach of Privilege, Violation of Appropriation Act and Incitement of the Nigerian Public a request for a supplementary budget or a transfer of funds with legislative approval. In the same presentation he accused the National Assembly of slashing N21B of the N31B vote for the Lagos-Ibadan Express Road. He said: "We were asked to complete those abandoned projects; the budget of the Lagos-Ibadan Express Road was reduced by the National Assembly from N31B to N10B. We owe the contractors about N15B, and they have written to us that they are going to shut down."

Te walkout letter by the division manager of Julius Berger, received on 5 June, said: "Honourable Minister, it has become evident that the required adequate funding for the continuation of the project is not available (…) We trust you will understand that therefore, and as a consequence of the unacceptable fnancial risk to Julius Berger Nig. PLC, we are left with no choice [other] than to immediately commence suspension of the works on the project, as earlier notifed."

Te corresponding letter from Reynolds Construction, dated 2 June, said: "At the moment, the outstanding debts for approved certifcates for certifed works stands at N7, 829, 277, 294 (…) It is noted that the 28-day window allowed for payment of the certifcates by Clause 60.4 of the Conditions of Contracts had long expired. In addition, there is another certifcate (No. 19) of N1,108,334,258 under processing. (…) Tus, making a total of N8, 937,611, 552. Te mounting debt profle on this project is worrisome" (Olawoyin, 2017).

Te news in 2018 was that the current government had "cleared the debts" for the project (i.e. they had paid the contractors), and around 50% of the highway upgrade had been carried out at this point (Fig. 9.2). However, as a result of these funding-related hold-ups, project completion would not be achieved until 2021 (World Highways, 2018). Te latest update comes from an announcement by the Minister of Works and Housing on television in Abuja on 5 June 2020, "committing" the federal government to completing the Lagos-Ibadan Express Road in the frst quarter of 2022.

#### **9.1.4 Discussion**

We have listed the Lagos-Ibadan Express Road as "completed" because, with the current funding and the two contractors reaching the home stretch, there is a reasonable expectation that it will be fnished by 2022 (or maybe soon after). However, this project is no great success. It will limp to completion at best after 13 years (more than three times the originally planned 4 years), with a budget of perhaps \$1.2B (four times the original budget of \$300M).

We have seen similar problem themes in several other cases, in particular, the instability of funding, to the point of contractors stalling, and the disruption from one administration to the next. One particular theme of this case is

**Fig. 9.2** Lagos-Ibadan Express Road during the habilitation contract

the failed PPP scheme. We have seen an announced (but probably not entirely real) PPP scheme, which was nevertheless strongly condemned by the Buhari government, in the Second Niger Bridge Project. We will also see a failed PPP scheme in the Ajaokuta Steel Project. Te PPP failure in the Ibadan project is particularly instructive.

Te claims and counterclaims are complicated and messy—Bi-Courtney was accused of having negotiated a lopsided agreement in its favour (taking advantage of inexperienced government counterparts) and of a confict of interest involving having the honorary legal adviser to President Yar'Adua on its board. On the other hand, Bi-Courtney argued that the road had not been developed because its eforts to source funds to execute the project had been frustrated by the federal government, in addition to being held back by bureaucratic bottlenecks at the Ministry of Works.

Te real lesson here is that the failure of this PPP was not caused by specifc idiosyncratic reasons but refected a general problem of one administration's agreements not being honoured by the next. One legal analysis comments: "Notoriously, when there is a change of government in Nigeria, contract agreements of the previous administration may be subject to 'review' or 'probes', which are sometimes politically motivated and not driven by public consideration. In this instance, President Yar'Adua's Administration's concession was cancelled by President Jonathan's Administration" (Elebiju & Ilesanmi, 2020), which was, in turn, criticized by the next administration, as we saw earlier.

Moreover, this observation from within the country is corroborated by an analysis from the UK: "According to stakeholders consulted, there is still some uncertainty about the extent to which government is committed to the concept of road user charges. Te government is reportedly currently working to develop a National Tolling Policy and has draft legislation under consideration by the National Assembly, which is meant to formalize the government's commitment to increasing the level of private fnance in the road sub-sector. However, both bills have been in development for a number of years – the concept of establishing a road fund and a federal road authority were initially developed in 1997 by the Steering Committee for Road Vision 2000" (Cambridge Economic Policy Associates, 2015: 10).

As we will discuss in our Conclusions and Recommendations chapter, PPP schemes can be powerful ways to get infrastructure projects completed without stretching public fnances. However, this requires a clear and reliable government policy, together with the sophisticated capability of the government to negotiate productive agreements with hard-nosed concessionaires. If these conditions are not developed in Nigeria, this avenue for the productive mobilization of private capital will not be available.

## **9.2 Lagos-Badagry Express Road Rehabilitation: A Stalled Project**

#### **9.2.1 Brief History**

Te Lagos-Badagry Express Road is the local name for the Nigerian section of the Trans-West African Coastal Highway. Te road connects Lagos, Nigeria, with Dakar, Senegal, and the Nigerian part ends at Seme Border Station. Construction on the Lagos portion originally commenced in 1998. As an extremely important artery for intra- and inter-country transit, it was decided in 2010 to make a concerted efort to widen the road from two lanes (with four lanes in some sections) to ten lanes, with a light rail running in the centre. President Jonathan awarded the \$500M contract to the China Civil Engineering and Construction Company (CCECC), a state-owned enterprise (SOE) from China.

Te project was greeted with jubilation by all stakeholders, given the immense need for transportation capacity. However, by the end of 2020 it had still barely begun (the Federal Controller of Works called the work "10.6% completed" in December 2020 [*NAN*, 2020]). Moreover, instead of improving the lives of the residents in the adjacent areas, it has made their lives worse, having brought trafc to a virtual standstill, resulting in signifcantly increased commuting times (from 15–20 minutes to 3–4 hours in some stretches), slowing down business transactions (forcing companies to open local ofces because their employees cannot travel), causing accidents and resulting in robberies of commuters, who are sitting ducks in their cars.

Te project demonstrates a combination of insufcient fnancial planning, which resulted in unreliable funding, questionable accounting and misrepresentations to the public, with excuses that point away from the sources of the problems.

Maybe the project has not strictly been abandoned (a transportation artery of this importance cannot simply be "abandoned"). However, despite repeated assurances from various parties, after 10 years there is no end in sight for a 60 km stretch of motorway (Fig. 9.3). Completion of the project will certainly not happen within the period of the current Federal Buhari Administration, and it is not even remotely within sight (Ochonma, 2019).

**Fig. 9.3** The state of much of the Lagos-Badagry Express Road ten years into the project

#### **9.2.2 Was the Problem the Fault of the Contractor?**

Te contract was awarded to Chinese SOE CCECC. Te contractor left the site in 2016, and the Lagos State governor vowed to "order them back onto the site" in 2019. Was this contractor a failure?

Chinese contractors have been infuential in Nigeria for three decades, and CCECC is the most prominent among them. Chinese contractors have gained signifcant market share in Nigeria because they "undercut local contractors by 25%" (Corkin & Burke, 2007); in addition, they bring fnancing from China that has, in contrast to loans from the IMF or Western countries, no strings attached in terms of political practices of the government (Osondu-Oti, 2016). On the other hand, Chinese contractors are not well liked by their local competitors (not surprisingly) or by employee associations because they skimp on wages and have the reputation of monopolizing senior management positions for Chinese employees, leaving only low-level positions to Nigerians.

In addition, there is growing suspicion about China, and by association against CCECC as a fully government-owned SOE, with respect to their motives. Are they spying and secretly identifying natural resources to be exploited? For example, some journalists have asked: "Such use of the area photographs that identifed the locations of minerals through the use of sophisticated seismic instruments was evident in the recently arrested Chinese nationals in some Northern states where they were extracting minerals for exportation to China. Is such an act classifed under 'Railway' construction?" (Odunmbaku-Wilson, 2020).

However, CCECC is clearly a competent and established contractor. It holds more than a hundred public contracts in Nigeria, including the \$1.2B light rail project in Lagos, the Lagos-Kano railway, with a budget of \$1.4B and four airport terminals to the value of \$500M. CCECC *did* abandon a contract previously—in 1995 (military) President General Abacha awarded them a contract to rehabilitate the national railway system (with straightening of tracks, adding locomotives and training local personnel). However, a senior foreign afairs ofcer in the Ministry of Foreign Afairs later admitted that the project had not been completed because of inadequate funding/nondisbursement of funds (the complication being that there might be undisclosed reasons for abandonment that were not available to the ministry, as the military exclusively handled external relations) (Osondu-Oti, 2016: 35).

Te conclusion of this discussion is that the contractor was most likely not the cause of the problems; rather, their walking of the construction site in 2016 was a symptom of the continuing instability of funding, resulting in a failure to pay their fees.

## **9.2.3 Dodgy Funding and Accounting**

In 2009 the federal government received a \$660M loan from the World Bank. However, only a small portion of this fund was for the Lagos-Badagry Express Road (addressing only an important intersection within Lagos), and this part of the loan was fnally approved by the federal government only in 2016 (Opeyemi, 2016). Te funding ran out quickly and with it the payments to the contractor CCECC, who ultimately abandoned the site in 2016 to stem their losses. However, the funding scarcity could not be discussed by the contractor in public: a CCECC representative still gave the rainy season as the ofcial reason for the lack of progress (*Premium Times*, 2017)—rains are indeed torrential during rainy season, but this is hardly an excuse in a region of Nigeria where this is the case every year.

However, various government sources did admit the funding scarcity. For instance, the commissioner for works and infrastructure admitted in April 2016 that the slow pace of work on the Lagos-Badagry Express Road was due to the scarcity of funds for the project, elaborating that the ministry had inherited 244 road projects from the previous administration in diferent local government areas of the state and 42 of the projects had been completed, while construction work was ongoing on others (Ihua-Maduenyi, 2016). Furthermore, in November 2020, Babajide Sanwo-Olu, Governor of Lagos, fnally alluded to overambition, publicly stating that the delay had been caused by "the government's plan to build a frst-class infrastructure that people would be proud of when completed [turning it from a two-lane road into a highway of ten lanes with a light railway in the centre]" (Olisah, 2020) (Fig. 9.4).

Disturbingly, possible severe budget irregularities came to the attention of the public in connection to the Lagos Light Rail Project (which was the "Siamese twin" of the express road project because the rail in its centre is part of the light rail project). However, an unwillingness by federal and state agencies to work together was one obstacle for the Siamese twin. Te light rail project had been commenced in 1983 (as the "Metroline Project") by Governor Jakande but was stopped by (military) President Buhari two years later on the basis of it being a waste of taxpayers' money. Te project was revived by Governor Tinubu in 2003, with a budget of \$1.4B. However, little progress had been made when Tinubu left ofce in 2007.

**171**

**Fig. 9.4** Large portions of the Express Road are still under construction in 2021

Te new governor, Fashola, revived the project again in 2008, awarding the contract to CCECC and promising completion in 2011. When this deadline passed, a new deadline of 2015 was set, which also passed. At this point, the governor's spokesperson commented: "Let me draw your attention to the fact that when the governor said that (rail will be completed in June 2013), he also mentioned that all these will be subject to availability of funds. So, if the World Bank loan is still being held up by the federal government and there are still issues, defnitely it would be impossible to do magic" (Olawoyin, 2020). Te next governor again promised completion of the light rail project, the deadline for which again passed in 2019. Te current governor, at the time of writing, Sanwo-Olu, promised that the blue line rail project would be completed in 2020 and become operational in 2021, but there are no indications that this will happen.

Confdence does not seem to be increased by accounting discrepancies in Lagos. In a 2010 report delivered by the China Railway Construction Corporation to its shareholders, published on the company's website, the company claimed that the sum of \$182M had been earmarked for completion of the project. Tis difered from the one released by Lagos State Government, which puts the project cost at \$1.2B (Olawoyin 2020). Moreover, some basic benchmarking was ofered by the opposition politician, Gbadamosi, who said in a public debate before the election in 2019: "Te light rail project is being built at a cost of over \$1B. However, there is a heavy rail project in Addis Abbaba that started in 2011 and was completed in 2016, already in use. [It was] Built at the cost of \$5.2M per km, where we in Lagos apparently spend \$54M per km on that light rail project, which has been on for the past ten years and has not been completed" (Gbadamosi, 2019). Of course, these are the words of an opposition politician, but they pose difcult questions about cost levels and squandered budgets nonetheless.

## **9.2.4 Protest, Additional Funding and Patching Up**

On 20 May 2019, road users, including business people and private citizens, as well as students of Lagos State universities, staged a signifcant protest. Dr Joe Okei-Odumakin, one of its leaders, said to the authors that the protest denounced the poor condition of the road and the challenges of hardship, economic loss, delayed medical emergency help, as well as street robbery (because car drivers stuck in trafc are easy victims). Tey accused the government of a complete lack of concern about their needs. Te federal and state governments mobilized massive security forces to dispel the protest with guns.

At this point, fnally, additional funding was mobilized. In 2020 the Federal Government of Nigeria raised N100B (approximately \$330M) with an Islamic Finance fund via income-bearing Sovereign Sukuk certifcates, with the purpose of fnancing real estate and manufacturing investments. Correspondingly, the government's 2020 budget contained N2.73B (around \$7M) for the Lagos-Badagry Express Road (Okeowo, 2020), but there would be additional funding of N4.5B (approximately \$11M) from the Sukuk fund (*NAN*, 2020).

In June 2020 Lagos State Government summoned the contactor, CCECC, to return to the construction site. However, in the meantime, "palliative" work was assigned in two sections to state agencies of Lagos State Government and the Federal Government of Nigeria (*Construction Review Online*, 2019). Tis was hailed in a ceremony by the deputy governor, who lauded the cooperation across agencies (indeed, a federal and a state agency working together without mutual sabotage was hailed as a major success).

However, the measures are only "palliative" (refecting the funds available)—they patch up portions of the road in order to allow cars to move, but they do not address the widening of the road through additional lanes and the addition of the light rail. Although this is celebrated as a success for local citizens (and it does improve their commutes somewhat), it does not address the fundamental lack of progress of the project. Te 10.6% completion status cited by the federal controller of works looks like it will stay that way for the foreseeable future.

#### **9.2.5 Conclusion**

Te Lagos-Badagry Express Road is a crucial project with huge economic benefts and support from stakeholders on all sides. No technological uncertainties have hindered progress. However, it has not made signifcant progress over ten years, in the process worsening the lives of the citizens living nearby (Agency Report, 2021).

Te themes that appear as explanations are recurring: overambition (possibly driven by pride or special interests) made the required budgets very substantial, which, combined with a lack of fnancial planning, led to an instability of the budgets available. Tis, in turn, made progress a hostage to money shortages, prompting the contractor to stop work. Added to these economic obstacles were dodgy accounting, which, as with the sister light rail project, may have funnelled a signifcant part of the already scarce funds into corrupt avenues, and all this was exacerbated by multiple subsequent politicians using the project (as well as other projects, such as the Lagos Light Rail Project) as campaign fodder, promising delivery to tight deadlines without a plan (or commitment) for how to make it work. In short, the project was set up to fail, just like other projects in our sample.

## **References**


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

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# **10**

# **Two More Power Plants**

Te Zungeru Dam/Hydropower Plant has seen its share of difculties and has consequently been delayed; it is still under construction at the time of writing, but it is already delivering some electricity and seems to be turning the corner.

Tis is in contrast to the Delta State Power Plant, sponsored by the state to fll an urgent need for electricity, as it is the primary oil-producing region of Nigeria. Tis project sits abandoned, with billions having been spent on it, and accusations and charges of corruption stand in the way of any possible forward movement in the future.

# **10.1 The Zungeru Dam/Hydropower Plant: A (Soon-to-Be) Completed Project**

## **10.1.1 Brief History**

Te Zungeru Hydropower Plant project was originally planned in 1982, but it took until 2012 for President Jonathan to announce its start. Zungeru is a 700 MW hydroelectric facility being built with Chinese assistance on the upper and middle reaches of the converging Kaduna rivers in Niger State. Te Federal Ministry of Power is the owner and implementing authority of the project. With an original cost estimate of \$1.3B, Zungeru is the largest hydropower project under construction. It was fnanced with a "concessional loan and preferential export buyer's credit" of the Export-Import Bank of China (China Exim Bank); this loan came with the appointment of a Chinese contractor, a consortium of the China National Engineering Electric Co. Ltd (CNEEC) and Sinohydro. Te China Exim Bank supplied around 75% of the funding, while the Nigerian government contributed the remaining 25% (\$309M). Construction work on the power plant started in May 2013 and was expected to take 60 months (until 2018).

Te highly technical project consists of a 2400m RCC roller concrete gravity dam and a clay core rock-fll dam, a powerhouse behind the dam, four 175 MW turbines and a tail race channel. Te Niger State Government was fully behind the project, with the governor publicly stating: "We are conscious of the importance of this project, not only as it afects our people, but for the nation, too. Tat is why we put in place a committee to interface with the communities and the contractors. We don't want anything to delay the delivery of this project. All hands must be on deck to ensure that we have a hitch-free operation on-site and for the project to be delivered on schedule."

Shortly thereafter, it became publicly known that the project would displace 98 communities domiciled in three neighbouring councils of the state. Terefore, Professor Chinedu Nebo, Minister of Power, inaugurated the Zungeru Hydro Community Relations Committee (CRC) in February 2014, in order to oversee the relocation of approximately 22,000 people in the afected communities. Te government also hired Global Legend Integrated Concept Company, a professional service provider based in Nigeria, for the relocation of communities.

An efort to support the relocated communities was required, with fnancial support for the Hydroelectric Power Producing Areas Development Commission (HYPPADEC) through the federal HYPPADEC Act of 2010 (Poindexter, 2014). However, ten months later, communities challenged the project in court, seeking a permanent injunction over low compensation and omission of names, while the project was stalled because of what the federal government described as "teething problems". Te state minister for power described the suing parties as "communities and powerful people" that forced the government to "bend over backwards" to satisfy them (Okafor, 2014).

Work stopped when Sinohydro laid of around 90% of its workforce (Echewofun, 2015). Te HYPPADEC bill was amended in 2015 to reduce the contribution that hydropower projects needed to make to the commission. However, it took until the end of 2015 for Sinohydro to rehire 800 workers and restart work, a delay of two years (*Construction Review Online,* 2016).

After the restart, the project progressed as planned. Tere were some problems, such as torrential rains that put the entire construction site under water and forced the construction teams to dig the tailrace area out from the water

and mud. However, these were within the normal expected range for such a large project and were overcome by the contractor in collaboration with the project supervising company, Tractebel, and its Nigerian partner frm. In March 2018 the federal government declared the project 45% complete (Bhaktar, 2018). Te authors visited the site in the summer of 2019 and witnessed orderly progress (Fig. 10.1).

Te project was not completed in 2018 as planned. Te communities resettlement litigation will delay completion until 2022 (possibly early 2023) and cause a budget increase to the amount of \$1.5B. However, one turbine started producing electricity at the end of 2019, and at the time of writing, in early 2021, progress looks so solid that completion now looks highly likely.

### **10.1.2 Enabling Factors of Completion**

Te authors discussed the Zungeru project with Edozien, Permanent Secretary of the Ministry of Power, Works and Housing, the project owner. He stated: "Yes, there are vacuums in government project management, which need to be flled by a process of project management activities, and there are at least six things to be done that can make a project successful." He named six principles that he thought were being followed in the Zungeru project, enabling it to avoid funding shortfalls and overcome difculties.


**Fig. 10.1** Zungeru construction site in the summer of 2021

Edozien did not even [want to] know what they were. However, the project organization worked through them.)


Tese six requirements are consistent with the principles that our study has found. Tey are too rarely followed (including by the Ministry of Power, Works and Housing, as we have seen). Te experience of the Zungeru project suggests that Edozien should have added a seventh principle: do not forget, neglect or underestimate stakeholders, even if they are simple village communities that are displaced by the project. Tese communities managed to mobilize powerful supporters and caused signifcant overruns and delays, which would have been avoided had they been taken seriously from the beginning.

# **10.2 The Delta State Oghareki Power Plant: An Abandoned Project**

## **10.2.1 Initiation**

Delta State hosts the majority of the oil production in Nigeria, representing a considerable amount of industrial activity. However, the federal electricity supply was 100 MW, compared to the approximate 1000 MW needed. Te idea of building an independent power plant (IPP) for Delta State was frst proposed in 2000, during the administration of Governor James Ibori. Ibori ultimately did not take on the project before leaving ofce in May 2007, but Emmanuel Uduaghan, his successor, did.

In an executive council meeting in May 2009, Governor Uduaghan approved the contract award for the acquisition and installation of two Open Cycle Rolls Royce Trent Gas Turbine generators capable of being fred by natural gas and diesel oil to generate 100 MW of electricity. Te contract was awarded to Davnotch Nigeria Limited, in partnership with an American frm, Southern Integrated Energy Limited, at a cost of \$125M, corresponding to N21.75B at the 2009 exchange rate of N176 to a dollar (Marskson, 2020).

#### **10.2.2 The Alleged Corruption**

In 2010 Ovuozorie Macaulay, Commissioner for Energy at the time, in his brief to the state's Economic Management Team, alleged that the government had paid 60% of the contract sum to Davnotch the same year (actually, within a couple of days). Te commissioner also alleged that at the time the contract was awarded, one of the owners of the company (and its founder) was Victor Ochei, a member of the Delta State House of Assembly.

Te investigation further alleged that the contract sum of N21.7B did not include land acquisition, appointment of consultants, insurance, environmental impact assessment (EIA), construction of a 132/33KVA transmission line to bring the generated power to the grid or construction for the gas supply for the IPP project. Tis led to the upward adjustment of the contract sum in 2010 to N23.2B (Marskson, 2020).

Tese revelations immediately sparked accusations of corruption. For instance, the Delta State Elders, Leaders and Stakeholders Forum addressed the Chairman of the Economic and Financial Crimes Commission (EFCC) with the accusation that there was no formal contract between the state and Davnotch, no invoices and no letter of credit (an accusation that Davnotch denied). However, the Federal Crime Agency later examined the case and confrmed that Davnotch did not have an operating licence, meaning that the contract payment should never have been authorized by the assembly (as confrmed to the authors in an interview). Victor Ochei became speaker of the Niger State Assembly in 2011. He claimed on his website that he had divested himself of all connections to Davnotch when he became speaker, and he denied all involvement when the corruption afair heated up. In 2014 Ochei resigned as speaker of the assembly (Kupferman, 2016).

In July 2011 Governor Uduaghan expressed the belief that the plant would be completed before the end of his tenure in 2015, as the two Rolls Royce generators were being delivered before the end of 2011. However, it soon transpired that almost no work was being done on the construction site, and the turbines were delivered to an empty site and were therefore out in storage (Fig. 10.2). Te usual excuses were given, for example, the lack of gas supply, the rainy season and a fre in early 2015 (this was reported in the press as "putting some old equipment on the site and incinerating it to have an excuse" [Shibayan, 2018]). Davnotch issued a press statement stating that "if building a power plant is that easy our country would have solved her power problems a long time ago" (Global Energy Monitor Wiki, 2020).

However, by the end of 2015, weeds had overtaken the project site, which had been deserted for a year. Te temporary ofces were under lock and key, while the warehouses were far from complete. Te press reported that Davnotch had abandoned the project (Oghre, 2015). In May 2017 observers noted that apart from the access road to the project site at Oghara, a perimeter fence, three buildings and a gantry, there was nothing else on the ground. Governor Okowa, who inherited the project when he took ofce in 2015, said during a town hall meeting at Oghara (which included the former governor, James Ibori) that the government needed money to connect the turbines at the plant to a gas pipeline. "A lot still needs to be done. We have brought in technical partners. Delta cannot complete the project alone because of dwindling resources. We need about N20 billion to bring it to a functional level. Te options are either to sell outright. But the important thing is to make it

**Fig. 10.2** Delta State Oghareki Power Plant Site behind gate

functional" (Oliomogbe, 2017). In other words, the government needed almost the entire original contract sum again in order to get the plant built. Okowa installed an investigation task force to fnd the culprits, but this did not result in indictments.

Te government announced, under the outgoing governor, Uduaghan, that it "had fnalized plans to sell of the IPP project to investors" (Orusi, 2016). However, to date there are no indications that any willing investor has been found.

Te Nigerian Economic and Financial Crime Commission (EFCC) launched an investigation, and the preliminary report alleged that more than 50% of the total contract sum had been paid to the contractor before the contract was awarded correctly. Furthermore, the accounts of how much money had actually been paid to Davnotch were contradictory (Oghre, 2015).

Moreover, in early 2016 the Serious Fraud Ofce (SFO) of the UK opened an inquiry into Rolls Royce, alleging bribery in multiple countries. One of these countries was Nigeria, the bribery having been committed by the company PSL Engineering & Control, which was acting for Rolls Royce, allegedly to infuence government ofcials; Victor Ochei was allegedly named in the inquiry as having been involved in this act of bribery (Urhobo Today, 2016).

Facing a combination of the money having run out (as the state did not have the funds to pay for the project twice) and of unresolved controversy over bribery and embezzlement, the project has been abandoned and is unlikely ever to be rescued (at least in its current form).

#### **10.2.3 Implications**

No court rulings or punishments have been issued in the Oghareki plant failure. Te public angrily demanded that action be taken—for example, the Empowerment for Unemployed Youth Initiative pointed out that corruption contributed to poverty and unemployment, and they blamed the former governor, Ibori, and former speaker, Ochei: In their words, "From […] evidence submitted, it remains clear that [Ochei] using his privileged position, in fagrant abuse of public service rules and in contravention of the Money Laundering Prohibition Act, infuenced and obtained the full payments for the said contract amount and diverted same to acquisition of choice properties, political famboyance and ferreting funds from Nigeria overseas" (Shibayan, 2018).

Te Federal Crime Agency confrmed to the authors that there had been fundamental problems with due process. A second inquiry was launched by the ofce of the state attorney general—but this was also questioned by the Empowerment for Unemployed Youth Initiative who alleged that the state attorney general was appointed by the Executive and approved by the State Assembly, thus sufering from a possible confict of interest. In any case, no judgements have been handed out, and therefore there are no culprits. Certainly, Ochei has not been backward in "showing of his wealth"; for instance, he was described in the rainbow press as selling one of his three Toronto luxury penthouse apartments (Kupferman, 2016). He has also vigorously pursued his political career, for instance, by fling and winning a lawsuit against his political party, the APC, forcing annulment of the party's primary election for the governor race because the election had sidelined him (Okafor et al., 2019); and in 2020 Ochei was appointed by President Buhari as the executive director of Maritime Labour and Cabotage Services in the Nigerian Maritime Administration and Safety Agency (NIMASA) (Vanguard, 2020).

Tere is an interesting contrast to this outcome in the UK: the Serious Fraud Ofce did hand out judgements. It identifed 12 counts of conspiracy to corrupt or failure to prevent bribery in seven countries: Indonesia, Tailand, India, Russia, Nigeria, China and Malaysia. Rolls Royce was ordered to pay fnes of £497M, plus costs to the SFO in the UK, in addition to £141M to regulators in the USA and £21.5M in Brazil. Furthermore, 38 employees faced disciplinary hearings. Some people complained that this was not enough, but action was taken and the company was severely punished, with a sum three times its annual profts plus a depression of its share price (BBC News, 2017).

However, no action was taken in Nigeria. Tus, this study cannot name anyone as having engaged in corruption. However, it is abundantly clear that corruption and bribery have been committed, and the lesson for perpetrators is that they can get away with it.

In concluding, we can summarize that the Delta State Oghareki Power Plant project is perhaps the most extreme example of corruption among our case studies. Corruption singlehandedly sunk this project into failure. In the other cases, corruption was more subtle—while present, it led to cost increases and bad decisions, weakening projects so they possibly succumbed to other problems that they might otherwise have overcome. Corruption is always corrosive, but this case is a disturbing illustration of how \$125M can disappear into the pockets of powerful ofcials and their foreign accounts, destroying an important project and massively contributing to poverty and deprivation in their state.

## **References**


**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **11**

# **The Ajaokuta Steel Project**

## **11.1 Project Initiation**

Te idea of large-scale national steel production frst arose as early as 1958 among the soon-to-be rulers of an independent Nigeria when it emerged that the regions at Agbaja, near Lokoja, as well as Udi, near Enugu, had signifcant amounts of iron ore (Matusevich, 2003: 191). Te ofcial view became that "any eforts to increase [a developing country's] power status through technological advancement must come through their own development of indigenous steel (…) no country can talk about power status or the pursuit of it, and the defense of national interests, in any form without a well-established, integrated, fully operational native steel industry" (Unongo, 1980: 7).

Between 1961 and 1965, several proposals were invited for the construction of an integrated iron and steel complex, but the result was that the (Western) suppliers did not believe this could be done economically using local raw materials. In 1967 discussions about a possible contract were initiated with the Soviet Union in response to Western countries criticizing Nigeria's civil war (instead of supplying weapons). Gaining a relationship foothold in the largest African country was important for the Soviet Union; soon after, a team of Russian steel experts recommended a blast furnace/basic oxygen facility (using the technology that Russia excelled in rather than the upcoming direct reduction technology that used gas rather than coke); as a result, the Russian frm Technoexpert was awarded a contract in 1970 to examine the quantity and quality of Nigerian ore and coal.

Te year 1971 saw the creation of the Nigerian Steel Development Authority (NSDA) to carry out surveys and research and to plan, construct and operate steel plants. Te NSDA received several rounds of reports from the Russians, and difcult negotiations took place between the Nigerian government and the Soviet contractor, Tyajz-Prom Export (TPE). Tere was widespread unease about deepened relationships with the Soviets (Alli-Balogun, 1988: 195), but a contract for the construction of a plant was fnally signed in 1979 (just before the military president, General Obasanjo, handed over the government to a civilian). A few months later, the new civilian Shagari Administration declared steel to be a high priority and created a ministry for steel. Te contract foresaw an initial phase with a plant of 1.3M tons of annual production capacity, for a sum of \$2B (with Nigeria also covering 50% of the cost of transporting and housing 7000 Soviet technicians and their families on-site).

In the words of (former) President Obasanjo: "In my frst presidency, there was the general belief that steelmaking was at the heart of industrialization. India had built a frst steel plant with Russian help, and they built their second almost without help. We thought we needed to achieve that, but we did not have enough money to do it alone. So, we went to the Soviet Union, and there we obtained the best deal on ofer: we got a free loan from the Russian government, and we commissioned an experienced Soviet contractor, TPE, to design and build the plant. I started the project, but then it was executed through the ministry of mines."

Te choice of location was difcult and ultimately "non-optimal". A place close to the available ore and coal deposits had to be found, and while Ajaokuta was one of the candidates, Onitsha was closer to both deposits. However, economic optimality was trumped by political justifability (in 1974, just four years after the civil war, awarding a strategically important project to one of the strongholds of the rebelling state was not considered prudent) (Oyeyinka & Adeloye, 1988: 26).

Moreover, much has been made of the raw materials dilemma: Nigeria had large ore deposits (albeit with low iron content, below 40%) but a paucity of coking coal, while there was an abundance of gas (from oil production). Terefore, the choice was between an (old technology) blast furnace process, with a relatively cheap "benefciation" of local ore, and a modern direct reduction process using cheap gas for heating, as well as iron reduction, but requiring higher-grade ore (of around 80%, which would have to be imported because an intermediate step to upgrade the local ore would have been prohibitively expensive). In the end, the blast furnace process was chosen (pushed for by TPE), but coking coal would have to be imported at least initially, because the local coking-ready coal from Lafa/Obi had excessive ash and sulphur content, as well as structural mine problems.

Terefore, the plant would require a dedicated 66 km rail line to transport ore from the mine at Itakpe, in addition to a river port to receive imported coking coal. Tus, it was clear from the outset that the economics of the plant would not be straightforward.

Nonetheless, all these problems ultimately had solutions and were known to the decision-makers, and none were "showstoppers". In our interview, President Obasanjo commented: "Te Russians warned us that our own iron ore would have to be 'benefciated' in order to feed this plant. So, we knew we would have to invest in this, and also, we would have to dredge the river port to ship the coal, and we committed to building a railway stretching from the iron ore deposit to the plant and further South to the coast. So, we made these three additional commitments at the outset – ore benefciation, river port and ore railway, to make it work" (Jimoh, 2021: 144).

However, another aspect of Nigeria's grand steel ambition was more insidious: Ajaokuta was not the only project in the pipeline. Nigeria's industrialization was believed to require a portfolio of steel mills: 1977 saw the signing of a contract with a consortium of ten German and Austrian frms to construct a 1M ton direct reduction plant, Delta Steel; and 1979 witnessed contracts (with Japanese and German companies) for three rolling steel mills of 200K tons per year in Katsina, Jos and Oshogbo to produce bars and wire rods (based on the steel output from Ajaokuta and Delta). More plants were foreseen.

Although Delta was commissioned in 1982, it never produced more than 200K tons per year, and even this declined because of rampant corruption (for instance, paying infated prices for materials), which led to declining production and, fnally, an end to its operations in 1995, which, in turn, shut down the rolling plants (Amzat, 2018). More generally, undertaking these overly ambitious projects at the same time turned the steel dream into a nightmare for Ajaokuta (Oyeyinka & Adeloye, 1988: 15): there simply wasn't enough money, or talent, to carry out all these projects.

## **11.2 Project Construction and Cessation by 1988**

In 1980 the FSDA became defunct and was replaced by specialized companies, one of them being the Ajaokuta Steel Company. TPE had originally been expected to deliver the project in 1989 and to deliver half the capacity as output by 1983. TPE had a track record of on-schedule, on-cost delivery of steel projects, including in Brazil, South Korea and China. However, the Soviets wanted to focus on the steel mill, so Western contractors had to be found for the civil works. Furthermore, disputes arose (with the Soviets withholding personnel because their accommodation had not been built), tensions arose between Russian and Nigerian personnel (because the Russians were perceived to be receiving astronomical salaries, among other things, see Alli-Balogun, 1988: 632), and delays and overruns accumulated. By the end of 1983, all work had to be halted because, being in an economic recession, the government ran out of money and stopped paying the contractors. Te civil works contractors withdrew their personnel, blocking TPE's work (Matusevich, 2003: 214), and work essentially stopped.

At the end of 1983 the military deposed the Shagari government and installed General Muhammadu Buhari as a military president. Within days, the Canadian-educated general manager of Ajaokuta was in jail, along with 12 fellow senior managers, accused of "stupendous dishonesties" (corruption and mismanagement), and all work at Ajaokuta was halted. In addition, relationships with the Soviets became so frosty that Nigerian ofcials accused the Soviets of wanting to bring more "technical personnel" than was necessary, with the Nigerian embassy refusing visas to 500 Russians who wanted to enter Nigeria in 1987.

Discontinuity across administrations was again, as we have seen previously, a factor in this tale. Of course, every administration had its own view. Here is the view of (former) President Obasanjo, who signed the original contract in 1979 (Jimoh, 2021: 145):

*Just after the handover to President Shagari, a representative of TPE came to meet Obasanjo in his retirement home with the complaint, "Mr President, you did not hand over well". Te president asked why he felt that way, to which the man replied that the minister of mines and steel was demanding a bribe. Te minister had refused to sign the certifcates of completion of jobs, which were needed for payment. But they could not pay any bribe from their contract sum since the payment for the contract was from Russia. "We do not have control over such payment since the bribe payment is not part of the bid." In sum, the project was blocked because of a "lack of enthusiasm for it," which resulted in the project no longer being given sufcient priority. Obasanjo spoke to his successor, Shagari, about it but did not know whether Shagari ever pushed for completion.*

Although Buhari wanted to stamp out wastage, he did not dare to stop the Ajaokuta Steel Project and the symbol of industrial development and selfsufciency that it represented (not to mention the destruction of 5000 jobs that it provided). A new agreement for the completion of construction was signed in August 1985, just days before the Buhari regime was overthrown by

**Fig. 11.1** Ajaokuta site entrance

the Babangida regime, but the schedule continued to be pushed back under Babangida, in 1988, 1989 and 1990, following the departure of Soviet personnel (Matusevich, 2003: 215).

Whatever the perspectives of the three administrations involved, by 1990 the project had ground to a halt from a lack of both funds and trust (Fig. 11.1). In the words of Matusevich (2003: 189), "Te empty concrete blocks of its township (…) and the still rolling mills (…) stand as silent monuments to the failed ambitions of Nigerian rulers to exorcize by fre and steel the demons of the colonial past. Tey stand as a silent reminder of the lost grandeur of the Soviet empire, which, terminally ill as it was, tried ftfully to plant its peculiar concept of modernization in an African nation, tried and failed."

## **11.3 The PPP Revival of 2000–2007**

When Olusegun Obasanjo came back for his second term as (this time civilian) president in 1999, the project had been stalled for ten years. He still believed in its rationale and wanted to revive it, but the Soviet Union, its previous partner, was no longer in existence. "I thought the project should be completed by the same people who started it, so I went to see the Russian government. But they said no, and it turned out that the original contractor had been Ukrainian anyway, which now was a separate country! So, I went to the Ukraine, but they were not interested either. Tat was when I decided that we should fnd a company from the private sector to do it. Against what people may tell you, a concessionaire was chosen by a public bidding process. Te winner of this process was an Indian company, founded by the father but run by the two sons, the younger of whom drove this bid – the company was Mittal Steel. But then the sons competed with each other and fell out."

In other words, when all avenues for continuing Ajaokuta as a government project had run out, President Obasanjo turned to a public–private partnership (PPP) construct. Te Mittal Steel subsidiary, Global Infrastructure Nigeria Ltd (GINL), owned by Pramod Mittal, won a concession, in addition to the right of way on the railway; GINL also bought the now-defunct Delta Steel for \$30M. Te process was handled by the Federal Ministry of Mines and Power rather than the Bureau of Public Enterprise (an institution established by an Act of Parliament to sell government assets or agree to the concession of government property).

GINL was given a ten-year concession for the Ajaokuta Steel Company in 2004. Tis was converted to 60% equity in May 2007 shortly before the exit of the Obasanjo government. However, a local company, BUA Group, had initially been chosen as the preferred bidder for Delta Steel and continued to agitate for its claim; soon material appeared in various newspapers alleging that the entire concession to GINL was illegitimate and was robbing the nation via an undervalued transaction. Te Yar'Adua government established an investigation panel in October 2007 and cancelled the concession agreement in June 2008, alleging that GINL had failed to meet its performance targets and to pay concession fees while undertaking asset stripping. GINL, however, proceeded to international arbitration (Olawale, 2013; Okafor, 2016) and won the case at the International Arbitration Court in London in 2016. (Tis settlement foresaw that GINL should be repaid \$700M and retain the right to operate the Itakpe mine, which gives us an idea of how much they paid for the concession 12 years earlier.) Te parties negotiated but had not found a mutually agreed settlement by 2017 (Udo, 2017), although the government claimed that a settlement had been reached, leaving GINL with Itakpe.

Now the government is attempting to get a new concessionaire, who will make the necessary investments. Tis process is extremely complicated (legally, and in terms of bringing multiple stakeholders on board), and no solution is currently in sight. According to the Bureau of Public Enterprise in an interview, the key challenge is not a business plan for a reconcession but transparency and credibility (including the understanding of any potentially interested investor that an agreement reached with one administration may be challenged again by the next). Before a fnal settlement, no contemplation of any revival of Ajaokuta will be possible.

**193**

### **11.4 The State of the Asset**

Te authors were able to visit the site of the Ajaokuta Steel Company, which is the size of a small city and employs 3000 people (who live on-site in dedicated housing) to maintain the site and keep it from deteriorating (but no steel is produced) (Fig. 11.2). Te plant is clean, but the age of the equipment is evident, not by deterioration but by design, and by the absence of modern IT-based control systems that drive critical productivity. Tis large organization is managed by a "sole administrator". Te administrator made an ofcial presentation, emphasizing that steel production is required for a country to reach the industrial age (with wording that seemed to have been lifted from Minister Unongo's presentation in 1980, cited earlier), and the presentation stated that the project was "95.6% completed". To the question of which measure the 95.6% completion rate was based on, the answer was "by the weight of all the materials that have been installed."

Te completeness measurement is a recurring theme—senior ofcials in Nigeria seem to like quoting precise-sounding completion fgures (which we saw in the Second Niger Bridge and several other projects). However, completion fgures are only as good as the underlying measures, and a weight measure is not in any way indicative of how much work and efort will be required for the last 3.6% of "weight" installed. Tis is illustrated by the estimate of how much money will actually be required to get the plant to production (backed up by an ofcial audit that the sole administrator initiated).

Te result was that it would take \$650M to install missing equipment and replace deteriorated equipment. However, in addition, another \$800M, contingent on the earlier \$650M estimate, would also be required to complete the surrounding infrastructure (railway and river port). In sum, actually starting up the plant and producing steel would require an additional two years (that's the good news, says the sole administrator) and a new investment of \$1.45B! (His successor made a presentation to the federal government in the summer of 2020 requesting this sum, based on the argument that a new concession would bring in more money for a working plant [Mogbede, 2020].) Tis sum certainly amounts to more than 3.6% of any relevant funds, both the approximate \$6B that the Nigerian government has actually invested in the project so far and the original \$2B (for plant plus infrastructure) that was agreed with TPE in 1979.

**Fig. 11.2** Ajaokuta Steel Plant's site in the summer of 2019

# **11.5 Conclusion**

What have we seen in this case study? Te project started from a reasonable policy stance: using steel to industrialize Nigeria. However, the project was conceived with a mixture of overambition and naivety—the complexity was augmented by political compromises in design and, even more so, by overambition in the total steel programme pursued; this came back to haunt the execution, which took place during a recession, causing the money to run out and the contractors to withdraw. Te themes of overambition combined with a lack of solid fnancial planning are reappearing.

However, fnancial planning has been exacerbated by the unwillingness of subsequent administrations to ensure continuity, as seen by the handovers from Obasanjo to Shagari, from Shagari to Buhari, and again from Obasanjo to Yar'Adua (in the latter, journalists quipped that although Obasanjo had supported Yar'Adua, he had to watch "his partners being raked by the new administration in multiple cases"). A lack of continuity has destroyed several of the projects in our sample. A lack of continuity is also relevant in the ability of the country to get PPP of the ground, a structure that has helped many other governments to get infrastructure built with the private sector, helping the government to avoid fnancial overstretch. If concessionaires cannot rely on the agreements being honoured by subsequent administrations, it will become impossible to fnd investors (of course, the other side of the coin is that the government needs to build the sophistication to negotiate with hardnosed and experienced business people who are happy to take advantage of naive negotiation counterparts).

Where does this leave the project? After 40 years and \$6B having been spent, the project requires almost as much remaining investment (this is optimistic) as the original budget, and no solution is in sight to make progress until a new investor trusts the government to honour its agreements. Moreover, simply adding the missing pieces is probably insufcient—the existing equipment is probably obsolete (in design, as well as controllability, and in terms of optimization, as well as automation) and, even if functional, won't be competitive. Tus, the true investment required is probably much higher than \$1.45B. However, the plant is so deeply embedded in the Nigerian rhetoric of industrialization and progress that "over the years, Ajaokuta has been the *most* permanent fxture of the ever-changing Nigeria" (Matusevich, 2003: 189), and no administration has dared to question it.

Olatunji (2018: 344) concluded in his analysis that the Ajaokuta Steel Project "did not deliver its promised potential. It did not fail either." We disagree. It is time to seriously ask whether Ajaokuta has a future. Remember that the plant has 3000 employees, in addition to site maintenance (and has had for the last 30 years, without producing a single ton of steel). Every year a decision is postponed, the country bleeds.

First, we have made enquiries about how much it costs to build a steel plant. Te answer exists as a frst "linearized" estimate analogous to the statement with which we are all familiar for residential homes: "A house in central Lagos costs N 'xxx' per square meter of habitable space" (and then we adjust this up or down a bit for budget or luxury design). In this spirit, the estimate for an integrated steel plant is \$2000 per ton of annual capacity, which would mean a budget of \$2.6B for the 1.3M-ton-per-year Ajaokuta plant. In fact, it is possible that we need to adjust this upwards slightly because fxed costs may play a role, so perhaps we should estimate \$3B. Tis is twice as much as the estimated completion cost of the existing Ajaokuta plant, but it would result in a state-of-the-art plant with modern technologies, controls and automation, which would therefore be competitive. Does this suggest that Ajaokuta in its ancient design should be completed?

However, the questioning needs to go deeper. Te logic of the need for Ajaokuta, the "modernization symbol", is rooted in the 1960s. Te leading nations have all lost their steel industries; steel has become a commodity that has undergone extreme price fuctuations over the years. Competitiveness today comes from services (prominently fnancial services), communication, IT and new developments such as AI, blockchains and intelligent decentralized constructive manufacturing. Nigeria is most competitive in IT and communication services. How damaging is it if steel costs a bit more (probably not much more) than if it were produced domestically? Is the construction of an industrial dinosaur really the path to modernization, or is it a path to the past? And would Nigeria be better of investing the next \$3B in the education of young people, in state-of-the-art technologies (albeit with better planning and commitment than in the current government projects)? One of the authors recently visited Kerala, a poor state in Southern India, and was told that they are investing in educating a critical mass of people skilled in blockchain technologies, in a bid to provide services for remotely controlled supply chains globally. Would something of this spirit not be a more proactive industrial investment for Nigeria than an industrial dinosaur?

Tese are complicated questions. We have no answers, only questions. Nonetheless, we propose that Nigeria should question the rationale behind the Ajaokuta Steel Project stemming from the 1950s and be willing to throw old notions aside if necessary.

# **References**


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# **12**

# **Insights and Recommendations**

## **12.1 Summary and Discussion of the Findings**

Where do we fnd ourselves after our econometric analysis of the questionnaires and description of the 11 case studies? Have we obtained a coherent picture that allows us to suggest changes in the management of large Nigerian projects for the beneft of the country?

Before we come to the insights from the analysis, we must admit that projects are complicated beasts, and success and failure, and even stalling and completion, are not always clear cut (e.g. is the Lagos Badagry project stalled forever? Could the Mambilla Dam project, although restarted now, also be called a borderline stalled project?) But in spite of the ambiguities and noise, our data analysis identifed four aggregate success variables (or factors), plus one individual variable, (corruption) that statistically explain a signifcant part of the diference in terms of success of the projects: the clarity and inclusiveness of the project goals, the professionalism of supervision and stakeholder management, the contractor selection, and the availability of resources and professionalism of planning (especially risk planning). Corruption stands on its own as an important success driver—this variable is sensitive, but because of the anonymity assured to the questionnaire respondents, we were able to get at least qualitative assessments of the level of corruption.

Te econometric analysis showed the size of the economic levers that the success variables represent—making moderate improvements can (as suggested by the project sample) save hundreds of millions of dollars for a single project. Complementing the econometric analysis, the case studies have demonstrated the success drivers "live"—they have shown us what it looks like on the ground when project success variables are missing and how the variables interact. Tables 12.1a and 12.1b provide a summary of the most striking observations.

Tables 12.1a and 12.1b show that all fve success variables (the four factors and corruption) identifed in the econometric analysis appear prominently in the case studies. First contractor selection and management caused problems in four of the six abandoned projects, but only in two of the fve completed projects (and after a re-awarding of the contracts, the situation improved and the projects were completed).

Second, project goals were widely accepted in most projects, but characterized as "overambitious" (and thus changing) in fve of the six abandoned projects, while they did not pose problems in the completed projects.

Lack of thorough fnancial planning connected to a lack of budget continuity is observed in all six abandoned projects, in two of them related to unsuccessful public–private partnership (PPP) schemes. Funding was an issue in two of the fve completed projects (Lagos-Ibadan expressway and Egbin power plant), but the projects "got away" with delays rather than catastrophic stalling.

None of the abandoned projects was brought down directly by protests or resistance from external stakeholder groups. However, we have seen the completed Zungeru Hydropower Plant temporarily stopped by protests, causing delays and endangering completion. Tree abandoned projects were plagued by disagreements among internal stakeholders (multiple government agencies) that did not agree or collaborate. Tese stakeholder disagreements go along with spotty supervision, which is mentioned for two abandoned projects but none of the completed projects.

Finally, corruption. Although direct evidence of corruption in the narratives of interviewees is uncomfortable and not easily volunteered, fve of the six abandoned projects were clearly afected by corruption, and it is highly likely that one (the Delta State Power Plant) was brought down by corruption. Only one of the fve completed projects has indications of possible corruption (although this lack of evidence is probably underestimating the issue, given its pervasiveness). We discussed in the econometrics chapter the evidence of corruption not just adding costs to a project but also poisoning the project with bad decisions, which severely reduces its chances of completion. Tis was illustrated in the Delta State project.

In summary, the qualitative case analysis strongly suggests that the success factors were systematically diferent between the abandoned and the completed projects (as the regressions in Chap. 5 already suggest).

**Table 12.1a** Qualitative description of success variables across matched pairs in three sectors (completed projects in green)




We can make this "counting diferences among the cases" quantitative by running a statistical test that compares each matched pair of one abandoned and one completed project per sector. We show this "counting diferences" analysis in Table 12.2. Te table contains the variable values for the fve success factors from the questionnaires (averaged for each project over the three respondents), for each of the ten projects in the case study pairs. Running your eyes over these numbers will give you the impression that the variable values are higher (and the corruption values lower) for the completed projects as compared to the abandoned projects. Tis is measured statistically with the chi-square tests for each matched project pair, which is highly signifcant: for each pair, the probability that the diference might arise accidentally is lower than 1%. Tis quantitatively supports the impression from Tables 12.1a and 12.1b, that each completed project had better management assessments on the success factors than its matched abandoned counterpart.

A common theme that runs across the case studies alongside the success factors is centralized decision-making (for which we had not developed a variable because this feature had not been separately pointed out in previous work). Centralized decision-making (by the president or governor, or a small group of people with special interests), with projects emerging from the president or governor's desk, is connected to the variables that we do measure in the questionnaire, by posing the risk of inconsistent decision-making and responding to current pressures (or special interests) rather than following a thought-through, long-term plan, even if the intention is to help the country. Moreover, "big-man decision-making" encourages a lack of continuity in project goals when the government changes—it seemed to be systematically the case that a new administration would tend to question, "investigate" or cancel project decisions and commitments made by the previous government. Even today, it is critical for a very large project that the president be involved, such that the idea for the project appears to come from the president directly as a directive or executive order. If described like this, the centralized big-man decision-making could be seen as one underlying issue that favours all the problems that we have measured and analysed. Tis is, of course, an oversimplifying catch-phrase because not all the problems would go away if the "big men" were not to make the decisions alone (although, if the decisions were also made transparently, signifcant improvements might already result!).

At the project approval point, the project rests in the hands of the president alone. He (so far it has always been a "he") infuences even the choice of contractor and directs the project's commencement and payment. Even to the present day, the Bureau of Public Procurement does not have a mechanism to change, alter or stop any project undertaken by the president in this fashion.


\* − refers to abandoned project, + refers to completed project

**Table 12.2**

Conversely, during any subsequent administration, if that president has no interest in the project, it can lay dormant because of a lack of interest and funding, whether it is half done or 99% complete. Processes are not sufciently mature to produce an irrevocable commitment irrespective of the government that started it.

Tis lack of continuity was enabled and exacerbated by the fact that project budgets were mostly made available for one or two years only, but rarely for the entire project duration. (Tis may be justifable if there are critical milestones and future budgets are made conditional on meeting progress milestones. However, this was not the case here—budgets were not secured for political, or simply a lack of planning, reasons). For some projects, allocated funds were "fctitious" and ultimately evaporated (which led to accusations of using projects as campaign tools with insincere intentions). In any case, the lack of goal continuity and funding instability led to non-payment of contractors and therefore delays.

When the project is badly set up in this way, negative events tend to happen that undermine the trust of the participating parties. Tere is no evidence that the projects in our sample sufered from incompetent contractors, and yet contractors did behave badly—the evidence suggests that they responded to the context. When the contractor sees opportunistic behaviour on the part of the supervising government parties and struggles to get paid, the contractor can be tempted to "play games" to ensure proftability (and to protect itself from bad behaviour from the other party); this might include pretending services, for example, by renegotiating, billing for unnecessary (or even fake) services or padding out budgets (as we saw in the Abuja National Library project). In the words of one of our anonymous interviewees, "If you repeatedly see that an administration 'empties the cofers' before it steps down, so you anticipate that you will not get paid after the change in administration, you are forced to take countermeasures." Our fnal conclusion is *not* that Nigeria needs to completely change its existing large project contractors. Actually, there is much experience and expertise in evidence among contractors. Te conclusion we have drawn is that the contractors need to be better guided and led by the government, project owners and supervisors.

Part of the problem is weak government oversight during project execution. Tis did not become apparent in our high-level case summaries, but it emerged clearly in a couple of interviews (the only case study where a *positive* statement was made about governance and oversight was the Zungeru Hydropower Plant project). Our anonymous contractor interviewee commented, "Te government overseers on the project get from us cars and computers to do their work, but then we don't see them anymore, and we certainly never see the cars and computers ever again. Government ofcials appear in large numbers when something has gone wrong, and then they demand that the problems are made to go away." Te depth and quality of governance scrutiny is insufcient; in particular, there is little sophisticated risk planning by the overseeing bodies.

## **12.2 Developing Solutions: Inspiration from Other Countries**

Before we jump to solution proposals, it is worthwhile looking at what other developing countries have done. We are not attempting any kind of a "benchmarking" exercise—making such an exercise worthwhile would require detailed studies that go beyond the scope of this book. Even more fundamentally, "benchmarking" assumes comparability: it rests on the compared situation being sufciently similar to the "benchmarked" situation so that decisions made in the other contexts carry over to the context of interest. We discussed in Chap. 2 that there are important local diferences, and the nature of the problem, as well as suggested solution approaches, are specifc to the structure of government and public sector in Nigeria. We cannot, therefore, see any solutions that one could simply "transport" to Nigeria. However, we can still learn a lot from the challenges faced by the other countries and the solution approaches that they chose. We can take inspiration from the fact that other countries have been able to considerably improve their large government project capabilities.

We conducted interviews with one high-level public project decisionmaker from each of three countries, namely, India, Tailand and Indonesia. Again, we are not looking for a precise and "provable" benchmarking here; we are merely looking for ideas that might arise from a broad look at what other countries have broadly done. It turns out that all three countries faced challenges of large public project success in the past, and they have developed improvements over the last 20–30 years. Te insights from the interviews are summarized in Table 12.3.

All three countries initiated and led major projects through government entities up until 20–30 years ago, facing similar problems to Nigeria, such as a lack of continuity, slow decision-making and corruption, causing delays and budget overruns (although a smaller fraction of projects seemed to be abandoned than in Nigeria). However, the three countries did not all choose the same remedies.



(*continued*)

#### **208 J. Ibrahim et al.**

#### **Table 12.3** (continued)


(*continued*)



Two of the countries (India and Tailand) heavily emphasized public–private partnerships (PPP), essentially outsourcing the capital provision and the associated risk–reward equation to the private sector, which gained 30–50 year proftable concessions from their investments.

In both cases the government needed to enact reforms that accompanied and enabled the PPP: for example, an explicit long-term investment plan with robust priorities was achieved through debate and consultation, which reduced the possibility of projects being created in order to "line specifc pockets". Tis also required the development of a competent, accountable and business-savvy cadre of (civil servant) representatives who could negotiate with private partners, to achieve fair deals on concessions and oversee project completion in a way that prevented the partner from demanding extras later, and could represent the state's interests during operation of the asset. Moreover, side conditions that aligned the asset's operation with the public interest (rather than running them for proft only) also required a high degree of sophistication and planning on the government's part.

Indonesia chose a diferent approach to India and Tailand, creating stateowned enterprises (SOEs) that bridged a commercial outlook (and access to private capital) with the safeguarding of public goals. SOEs pursued proftable commercial projects and obtained subsidies for, or they cross-subsidized, "public goods" projects that were not viable on a purely for-proft basis. In other words, Indonesia struck a diferent balance of commercial discipline versus alignment with public goals. Tis approach tapped into the skills of the existing pool of professional managers of large enterprises, who could move over and run SOEs that were similar in their management challenges, especially as the SOEs were under commercial pressure to not only pursue public goals but also earn returns for the government via the commercial opportunities of the projects. Te commercial nature of the SOEs also came with public scrutiny of account—and therefore a degree of transparency. Tis approach was also successful, in terms of achieving project execution speed and success and improving public outcomes for commercial projects.

Both the discipline and commercial oversight of the private sector in PPP agreements and the professional SOE management signifcantly improved project outcomes. However, both approaches created their own new challenges—there is no panacea or perfect solution. Very large government projects inherently contain temptations to engage in selfsh behaviour, especially in the context of a complex management challenge that always ofers some ambiguity to hide behind. Tis is also visible in the qualifed success of the new project management approaches in the three countries (see Table 12.4 this needs, of course, to be taken merely as a frst "hypothesis" given that this comparison is based on a small number of interviews so that biases cannot be excluded).

Te advantages of the PPP approach were bought with the challenge of aligning the running of concessions with the proft goal, which was not always


**Table 12.4** Strengths and weaknesses of the three countries' new project management approaches

pointing in the same direction as the public interest that triggered the projects in the frst place. Moreover, the PPP construct did not eliminate corruption—opaque deals continued to exist (indeed, a second interviewee who had promised to speak with us in India was unable to attend because he had to appear in court in relation to a corruption charge against his company). Te indicated direct costs of corruption are consistent with what we were told in Nigeria.

A diferent challenge arose from the SOE structure in Indonesia: the crosssubsidization option (of being assigned a lucrative commercial project in order to fnance a "public-good" project that achieved a public beneft but could not make money) created an incentive for SOEs to "widen their empires". Te resulting opacity of complex activities with non-trivial (but ofcially sanctioned) cross-subsidies gradually eroded transparency over time and made them hard to control. Tis, in turn, created its own sources of corruption (or internal misappropriation of funds), also leading to a deviation of resources and project objectives from public goals. Moreover, success still depended on the competence and alignment among government entities themselves (several examples indicated how confict between federal and local government damaged projects). Tis reminds us that very large government projects are so vital and complex that they can never simply be "outsourced" (even to SOEs); government must still live up to its accountability in terms of initiating, overseeing and supporting the success of large public projects. A debate about the future privatization of SOEs in Indonesia is underway.

An observation common to all three countries is that corruption has not been fully eliminated. Tis is disappointing, of course, but certainly not unique to these countries. In the complexity of large government initiatives with multiple goals, there is always ambiguity within which corruption can hide. Eradicating it is extremely difcult, which all countries have found, including the most developed leaders. Reducing corruption must be a constant priority everywhere, because of its deeply corrosive efects, which we have seen in our econometric chapter and in the case example. Te level of corruption that we have seen in Nigeria must be reduced, but eradicating corruption is rarely achieved.

We have now seen from the discussion of the developments in three other countries that there is no universal and uniform answer to the challenging problem of large public-sector project management. Te three countries chose diferent solutions, refecting difering situations in their local conditions and posing slightly diferent trade-ofs in each country. Terefore, there is no "right solution" that we can derive from these countries. However, there is some hope, because the three countries have been able to make signifcant improvements. Terefore, the goal for Nigeria must be to fnd its own solutions to its devastating large-project problem, while respecting the local Nigerian strengths, weaknesses and challenges.

## **12.3 Recommendations**

While we have seen weaknesses across all measured variables, the root of the project completion problem has been centralized decision-making in the creation of the projects. While this has been a weakness, it could also ofer a strength. Te weakness has been that presidential egos have been too involved, and competition among presidents about who did what has ultimately not been constructive. Te emphasis should be on a project succeeding, rather than it being successful because a certain president did it; the money spent on the project is Nigerian public money, not the president's money. On the other hand, the president is respected and has power—and therefore he can ensure execution. Tis power needs to be harnessed in the direction of a widely accepted plan. If presidential thinking were to change from "I created projects A, B and C", to "I made sure that projects A, B and C from a consensus priority list actually came to fruition", or to "*We* created projects A, B, C", the efect of the president's power could help large public projects.

Tere is certainly some awareness of the problems of decision centralization. In one interview the authors asked (former) President Obasanjo what he thought should be changed. In response, he referred to a former German chancellor: "I asked my friend Helmut Schmidt what he discusses in cabinet meetings. He said, 'We discuss policies and budgets and outcomes, but not individual initiatives.' So, take the individual projects away from the government!"

Te conclusion is that the Nigerian government must step up and play a more decisive, long-term and reliable role in leading very large projects, which includes de-emphasizing the politics of very large projects and instead putting the emphasis on competent management by civil service institutions. Tis implies long-term changes in government processes. However, long before the government bureaucracy can be changed systematically, a number of measures should be taken to rescue some of the huge projects that are in trouble, at great cost to the Nigerian citizen. Terefore, our recommendations have two parts, which we will develop in turn:


#### **12.3.1 Recommendations Part 1: Short-Term Changes**

#### **12.3.1.1 Diagnostic Review of Abandoned or Stalled Projects**

Te Nigerian government could consider, as a pilot project, currently abandoned or stalled projects (from our list, or beyond) for review and change the aims and objectives of the project to refect the new reality. For instance, the Abuja National Library might be reassessed to identify a clear and agreed-upon purpose, and its design modifed; for example, it could be repurposed as a new formats and technology library, in an age where book collections are migrating online everywhere.

Once diagnosed and endowed with a clear purpose and design, such a project could become a priority for funding in a pilot scheme; for instance, we may take three nationally important projects every fve years. Te pilot scheme would be led by a ministry with the required expertise and put together the funding (based on a business plan), adjust the design and, where necessary, reactivate stakeholders' buy-in. One example is the Ajaokuta Steel Project, where the nation has spent over \$6B and 40 years on the project site, resulting in abandonment (although no one will admit it). It would be appropriate to ask for the price of an alternative, for instance, the cost of a similarly sized modern greenfeld site (which we have already alluded to in Chap. 11). Tis would need to be benchmarked against the cost of completion of the old project. Tis needs to be accompanied by carefully balancing political interest, as it seems late in the day to say that we have left Ajaokuta for Lagos to start the same project.

Restarting makes sense for many of the stalled projects that do not really have an alternative, such as the Lagos-Badagry Express Road, which needs to be accomplished one way or another. Tere should be a clear focus and clean specifcations, in addition to resources and accountability, for these projects so that they can fulfl their missions, rather than inventing new ones.

## **12.3.1.2 Resolving Funding Challenges**

One basic argument made by the government is that there is no funding for the completion of abandoned projects. Tis may be true given the many challenges of government projects and demands for increased security funding. However, we have found that many of the abandoned projects have reasonable business cases that can attract private-sector funding in a partnership between the government and the private sector. In other words, we ask whether it is really (as it seemed from the case studies) impossible to start using private–public partnerships (PPP) in appropriate cases?

A key challenge is the lack of continuity of government attitudes towards PPP, which has blocked PPP agreements that had already been signed (such as the Lagos-Ibadan Express Road or the Second Niger Bridge); moreover, corruption and a lack of stakeholder engagement may scare investors away from participating.

We recommend PPP in the section on long-term measures below, as one of a portfolio of available and mastered funding schemes, subject to an enabling environment and assurances that investors will be able to pursue the agreedupon goals without government interference. However, in the face of scarce funds, maybe even in the short term, a few projects can be jumpstarted using PPP (and the associated private-sector investment). Tis might be feasible with the help of experienced outside advisors who have the capability to negotiate good and robust agreements for the government, as well as making it clear to the government where its responsibilities in the success of PPP funding lie.

#### **12.3.1.3 World Bank/IMF Assistance**

Financing may well be available in reviving abandoned or stalled projects. Te Nigerian government can make the case for funding to international bodies, to complete abandoned projects, particularly projects that signifcantly afect the standard of living, or projects that can accelerate technology development in the country, for example, the Lagos-Badagry Express Road and the Second Niger Bridge. Te special package for Nigeria's abandoned projects can comprise project invoice fnancing of 70%, and 30% cash disbursement to a reputed international contractor appointed to complete the project. Bridge fnance can be put in place once there is an indication of funding from the IMF. Te World Bank may be able to make a new loan subject to a percentage of completion of the abandoned project (and to putting in place functioning governance for the project). Tis will encourage the government to complete a new project rather than pressing for a new loan for a new project, which will once again pose the risk of abandonment if no changes to project management are made.

#### **12.3.2 Recommendations Part 2: Longer-Term Structural Changes**

In order to step up in its role in the longer term, the government must make several institutional changes and develop a number of procedures. Producing the required changes and issuing operational regulations and plans will be complex and involved. Terefore, the authors of this study cannot give detailed prescriptions here, which would go far beyond the scope of this book. However, the results of this study enable the authors to suggest a number of principles that the government may want to consider. Our suggestions consist of six elements.

## **12.3.2.1 Element 1: High-Level Political Priorities**

Rather than initiating specifc projects, the president (the executive) should articulate a strategic plan of broad areas of major initiatives with defned priorities (such as power, roads and educational institutions). Tis would come with a broad budget envelope, not detailed by project but dedicating a certain fraction of the total annual government budget to such infrastructure initiatives (say 15%). Te strategic priorities and budget envelope should be debated and approved annually for possible modifcations of broad priorities (but in the spirit of adjusting future directions, not touching the specifc projects already underway). Tis forces the legislature and the executive to be disciplined—not every pet project can be ftted into a limited budget. An explicit limit implied by this is that the president and legislative would not propose specifc projects but only set broad priorities. Te actual projects would be proposed by a ministry (see below). Tis, again, enforces discipline and, at least somewhat, limits the leeway for political patronage projects ("pork" in US-American language). Te equivalent should happen at state level for state-level projects.

## **12.3.2.2 Element 2: Portfolio Planning and Budgeting**

We propose that an agency be created to own and oversee the portfolio of projects, which makes progress towards the strategic planning of major initiatives. For now, let us start with the working title of *Large Government Project Strategy and Budgets Ofce*.

Tis agency has an important role to play by being given the authority, on the one hand, to enforce budget discipline, while, on the other hand, ensuring budget continuity for projects already on the way. Parliaments may sometimes feel non-bound by budget constraints; a ministry of fnance that enforces a politically determined maximum budget can ensure that the abovementioned trade-ofs are not ignored.

Te Large Government Project Strategy and Budgets Ofce would generate an actual portfolio of specifc projects and be responsible for presenting it to the assembly for their approval in order to make progress towards the assembly's strategic plan of initiatives, within the given budget limits. Tus, the agency would be responsible for developing competent business plans for all projects that are submitted (including public beneft, economic viability, reasonable cost and time estimates, and funding strategies) and for presenting this portfolio of project summaries to parliament.

Te reason for this structure is that we know from the experience of many large companies (and from the public sector) that project portfolios that are articulated without recognition of capacity and budget limits are prone to lead to an overextension of resources and inevitable stalling of projects, which are then underfunded (as we saw in the Ajaokuta case).

Te Large Government Project Strategy and Budgets Ofce would consider multiple approaches for project-delivery "channels": projects overseen directly by the government; projects "rented out" in PPP agreements with concessionaires; and possibly also the creation of specialized SOEs for the execution of niche projects that require special expertise and have a public good element to them, meaning they cannot be handled by general commercial markets. Te negotiation of project contracts and PPP agreements can happen within the agency, but the creation of an SOE for public-good-type projects requires special policy expertise that may necessitate consultation and agreement with other agencies (e.g. the Bureau of Public Enterprise, but this would have to be defned). In both cases, this requires the hiring and retention of highly qualifed professional personnel.

#### **12.3.2.3 Element 3: Institutional Changes**

Te Large Government Project Strategy and Budgets Ofce could, in principle, be part of the Ministry of Works and Housing (which is the result of the 2019 split into two of the former Ministry of Power, Works and Housing). However, the missions of these two ministries are to "provide social amenities such as power across the country" and, respectively, to "provide adequate and afordable housing for all Nigerians". (Similar briefs hold for other relevant ministries.) Tese wider remits are mostly concerned with policy issues and wider budget and legislative priorities, and not with project execution. Te ministries do not have the focus and resources to build the specialized expertise for executing large projects, across the felds of general infrastructure including power stations, dams, roads, housing projects, IT infrastructure projects and social development projects. Since we have seen that the project problems have the same recurring themes across all of these felds, it makes sense to create a "project management and execution specialist" ministry, which would serve the policy priorities that are guided by the various feld ministries; it would also be responsible for coordinating project design with them and delivering the projects to the legislative and the president. Te feld ministries would guide policy, and thus the priorities set in the strategic plans by the executive and the legislative, but it would be the specialist project management ministry to design the projects (in order to contribute to the strategic plans) and deliver them.

Tus, because of the project execution requirement, we suggest creating a ministry of its own: rather than the above-mentioned Large Government Project Strategy and Budgets Ofce, our proposed new agency would be the *Ministry of Large Government Projects*. Its focus on competent project initiation and execution is important given the number of abandoned projects and their economic value, both in monetary terms and in their wider contribution to the economy. Tis ministry would have to play the role of budget holder (within the assembly-determined envelope), project owner and project supervisor, to work with contractors on projects that are executed as government projects; it would also have to build knowledge and training, as we describe in Element 4.

Te proposal that project owner and supervisor sit in one ministry (that the other ministries, such as power or housing, do not serve as owners) is important. If the execution happened outside the owning ministry in a separate government entity, the problem would arise of one agency making plans and the other having to execute them, which is a recipe for mutual fnger pointing, with one side claiming that the other side did not deliver, and the other side accusing the frst side of having produced unworkable plans. Accountability would be split and therefore compromised.

Tis institutional reform would tangibly demonstrate an acknowledgement of the huge economic impact of delivering large government infrastructure projects for the development of Nigeria. Te Ministry of Large Government Projects would have the responsibility to improve the design and delivery of projects, and it could also be the starting point for returning some of the abandoned projects to completion and success. Where this was not possible, the ministry would turn over the (partial) assets of a stopped project to an appropriate government department responsible for the sale of such assets (e.g. the Bureau of Public Enterprise). Te funds realized from such deals could be directed towards completing other projects.

However, the Nigerian president has signifcant institutional power and may not consent to simply reducing his (maybe in the future, her?) power to have input in a strategic plan and to disengaging from the awarding of large government projects. Terefore, we also recommend that an ofce of special advisor to the president on large government projects be established, which has a dotted line reporting to the Ministry of Large Government Projects. Tis advisory ofce would establish a line of communication between the president and the ministry, with the two complementing each other.

#### **12.3.2.4 Element 4: Project Execution in the New Ministry**

Te Ministry of Large Government Projects would own and oversee the execution of projects that make up the (legislative) approved portfolio. It would be responsible for the execution of any government project above a certain budget size (perhaps in the order of \$500M). Te Ministry of Large Government Projects would have the following responsibilities, each of which would need to be supported by matching capabilities:


highly qualifed and need to be paid and treated sufciently well so that they stay.


Tere are more than enough very large government projects in Nigeria to warrant the creation of an Agency of Projects (and its larger ministry). Te ministry should be accountable to parliament.

## **12.3.2.5 Element 5: Audit Bureau**

Even government ministries (in all countries) succumb to the ever-present temptations of graft and corruption over time if they are not regularly held accountable, not only by reports to parliament but also by deeper audits. Terefore, this element of our suggestions concerns the creation of an (or use of an existing) *Audit Bureau*. Te Audit Bureau should sit in a separate ministry (to avoid conficts of interest) and have (or build) sufcient specialized expertise on project reporting to be able to examine the accuracy of the Agency of Project's reports. Te Audit Bureau should issue an annual report that summarizes the state of projects underway to the public, from an external perspective. Transparency creates its own dynamic of discipline.

#### **12.3.2.6 Element 6: Fraud Prosecution**

Te fact that no one was charged after the Delta State Power Plant project disaster should alarm the entire country. We therefore suggest the creation of a *Serious Fraud Ofce*, which could be part of the Ministry of Large Government Projects (it could also be part of the Ministry of Justice, in order to achieve independence and impartiality). Te Serious Fraud Ofce should have the power to take cases to court after investigation and to demand criminal inquiries and the start of proceedings in a criminal court. Te Federal High Court may decide to create a Special Judicial Division (a set of dedicated judges), who have at their disposal special procedures for crimes relating to fraud in large government projects.

Tis will, again, require that the Serious Fraud Ofce be given a budget to hire an (initially small and focused) cadre of highly qualifed investigators specialized in white collar crime in a large project environment. Whenever one asks for a budget, discussions become difcult (everywhere in the world), but we repeat that the sums of money recuperable for the government are so large that hiring a few well-paid specialist professionals seems to be a small price to pay.

In creating the Serious Fraud Ofce, the Ministry of Large Government Projects could ask for assistance from Nigeria's Inspector General of Police the Serious Fraud Ofce will need well-trained, experienced and senior police ofcers who are capable of conducting thorough and impartial investigations. Te fgure of 60% of 11,886 federal government projects having been abandoned over the last 50 years represents a high number of potential cases, and this number does not include any large government projects abandoned in the 36 states and 776 local governments of the Federation of Nigeria.

As long as perpetrators can hope with some realism that they may get away unscathed with the theft of tens of millions of dollars in the chaos of a large government project, the battle for transparent project management will remain arduous.

We conclude this chapter by repeating that our six elements are merely suggestions—although we have taken the Nigerian context into account, we are not sufciently knowledgeable about the specifc pressures in the Nigerian government that would infuence the decisions on a management system such as the one that we propose to set up. Our six elements represent "principles" of large project management, the installation of which is well justifed by the evidence that we have presented about the failure of large government projects in Nigeria. We believe it is the responsibility of the Nigerian government to put a management system in place, not necessarily verbatim, following our suggestions, but addressing the principles that we have pointed out.

**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

# **13**

# **Conclusion: The Government Responsibility**

Tis is the frst book about Nigerian very large government ("mega") project management. It is, of course, not the frst book on very large project management—we demonstrate that, in principle, the same 1000 things can go wrong in very large government projects in Nigeria as anywhere. From existing professional knowledge, we explicitly identify 80 success drivers, which are aggregated variables, each of which easily has 10 sub-dimensions—very large projects are complex beasts. Importantly, we are able to identify *which* of the many success drivers are failing in Nigeria, and why—in other words, how the context infuences where changes must be made.

In short, the track record of very large government projects in Nigeria is lamentable. A total of 66% of very large projects since 1960 not only failed but abandoned (according to the government's own analysis) is worse than the track record in other countries; and not only has it wasted billions (not naira but dollars) of national wealth, but it has also failed to deliver the infrastructure services that the Nigerian citizens so desperately need.

With a population of over 200 million people and an annual population growth of approximately 5%, Nigeria needs infrastructure and services, enabled by large government projects, for sustainable growth. Unfortunately, with so many abandoned projects at federal government level, it is increasingly challenging to provide economic growth that will meet the global agenda of eradicating poverty in 2030 (just the four largest of the projects we have considered account for over 30% of the national debt). Slow-in-coming government services and increasing external debt increase the complexities of national governance.

We are making the case for change to the government. Terefore, we have resisted the temptation to write captivating stories—our case studies demonstrate that we could have written a book with "juicy" stories. However, we decided to forego excitement for good reason: if we are to dare to ask civil servants—who are cautious all over the world because they are under public scrutiny to not waste taxpayers' money—for signifcant change, we must provide a well-argued rationale backed by solid evidence. Tis is what we have attempted to do.

We have assembled a unique data set, which has not been assembled before in Nigeria, because no reliable data was available at all. Te respondents to our questionnaires gave their answers only because we promised anonymity and because they trusted the authors—academics and a well-known businessman with an honourable reputation. We are upholding that promise. Moreover, we obtained *three* responses per project (from a representative of the projectowning organization, a representative of the supervising organization, and from the contractor), in order to make sure that we did not get one biased view but multiple views from diferent perspectives.

What we found is very clear and robust. We have not seen sufcient preparation on the part of the Nigerian government to develop the considerable leadership and bureaucracy competence in addressing the problems created by troubled public projects. Nor have we seen the desire to change the causes of the problems. Tis would constitute a challenge even if Nigeria had sufcient funding to rescue the abandoned projects.

From econometric analysis of the questionnaire, we identifed fve key success drivers: the clarity and inclusiveness of the project goals; the professionalism of supervision and stakeholder management; the professionalism of contractor selection; and the availability of resources and professionalism of planning (especially risk planning). In addition, corruption stands out as a corrosive force that not only bloats budgets but also distorts decisions and can bring down a project all on its own (as one of the case studies clearly illustrates). Te econometric (data-analysis-based) fndings are clearly corroborated and illustrated in the 11 detailed case studies.

What we fnd is not comfortable—the core of the project problems lies in the way the government has initiated, designed, fnanced and overseen (with stable goals) projects. Chapter 12 has laid out these problems in detail: projects are initiated by one person (the president or governor) or a small group of people. Tese projects may well incorporate the best intentions (although not always, as they sometimes represent "political campaigning tools"), but as they lack broad discussion and commitment across political institutions, they are vulnerable to discontinuity in goals, as well as resourcing (by the next administration, who has no interest in supporting the previous administration). Tis is exacerbated by a lack of rigorous fnancial planning for the entire course of the project.

A key challenge with decisions revolving around one person (or a very small group of people) lies in the fundamental limits of rationality and knowledge that any one person can possess. Although the president understands, of course, the vision and strategic context of where the country can and should go, the president has limited understanding at the time of decision-making about feasibilities, trade-ofs, risks and requirements that afect the outcome. One person simply cannot make such decisions. And yet, we have seen systematic exclusion of the Federal Bureau of Statistics in decision-making on large government projects. And even in selling troubled government assets, we have seen established institutions being pushed aside, such as the Bureau of Public Enterprise (BPE) (for instance, in the Ajaokuta case). Arbitrary "power grabs" in decision-making not only compromise the quality of the decisions but also damage institutions' legitimacy and stakeholders' buy-in. Ten, political power-brokering creeps in, which exacerbates opportunistic decisionmaking and opens the door even wider to corruption or hijacking by pressure groups.

Te Nigerian government's compromise over many domestic factors in the decision to site projects such as the Ajaokuta Steel Project and the Abuja National Library, to mention just a few, is regrettable. Te president's oneperson decision on matters relating to what large project to build, and where and when, compromises the domestic environment, such as the impact of pressure groups, social interactions, stakeholder engagement and national interest. In such an environment, any good intentions by the president will become compromised by political manoeuvring that undermines the project's success.

It is not the case that contractors were incompetent (yes, they have often taken advantage of the ambiguity caused by poor management by the government, but on the other hand, they were sometimes left little other choice because they had to defend themselves against capricious changes and unreliable payments by the project owners), or that project management execution knowledge was missing. Alongside unstable resourcing and goals (on one occasion, a former president admitted there was no fnancial plan for a project running into billions of dollars), the project supervision has also sometimes lacked efort and depth. In short, what was missing were direction and stability by the owners—the government.

Corruption creeps in anywhere, as we mentioned earlier. Whenever processes are not transparent and rigorous, with clear principles and criteria, and whenever projects are decided by small groups of people, the temptation becomes irresistible for cronyism and secret infuencing by interested parties to creep in. Tis leads to goals being compromised or distorted, contractor choice and contract design being infuenced by criteria that are not necessarily in the interest of the project, and, during execution, the project becoming vulnerable to mistakes, resistance and discontinuity. (Tis temptation is, of course, present not only in Nigeria but in all countries. Even in the most advanced economies, corruption creeps back in as soon as vigilance against it weakens.)

Our econometric analysis has been able to estimate the economic levers of making improvements—for instance, a one-point improvement in corruption (out of seven "quality points", in the estimation of our respondents) can reduce the abandonment risk of a \$1B project from 50% to 20% (based on the data in the projects in our sample). Tat represents an expected value of \$300M for one very large project alone! Even for the projects that were completed, the success drivers represent huge economic leverage: a one-point improvement (again out of seven "quality points", in the estimation of our respondents) in contractor selection and contracting can reduce budget overruns from an average of 700%(!) to 250%—again, on a \$1B project, a value of several billion dollars. Te value of improving the identifed problems is literally staggering and can make a signifcant diference to government budgets and to prosperity in Nigeria.

Readers who are familiar with project management methods may notice with some surprise that this book is not about the usual project management *methods*, such as strategy cascading, work breakdown structures, design structure matrix to handle interactions and complexity, critical path planning, risk management, stakeholder planning and management, earned value analysis, fnancing methods, contracting methods, milestone defnition, agile methods, and so on. We are, of course, not implying that these methods of project planning and execution are not important—they are the basis of the "trade" (or "profession") of project management. Te emphasis that we end up with in this book refects our fnding that the Nigerian project problem is, ultimately, about governance and not competence of execution—the bottleneck in Nigeria has been how projects were set up, funded and monitored. Tis contextual challenge is likely to be present in other African countries too.

Te party that needs to make changes to address project performance in Nigeria is the government. From our diagnosis, we have made actionable recommendations in Chap. 12. First, there are short-term measures of identifying large troubled projects that are still recoverable, sharpening their mission, fnding funding and executing them with appropriate oversight and accountability. Beyond these short-term measures, we propose six structural changes that may help the government to address the root causes of mega-project problems:


Te government has the responsibility to set up a professional system that delivers the crucial value from major infrastructure development for its citizens.

Although we are highlighting huge problems in this book, considerable strengths and competencies are also clearly visible—we do not consider the situation to be hopeless, particularly when we consider the role of Nigeria in Africa and the possibility of a prosperous Nigeria supporting a prosperous African continent. We believe that our (high-level) recommendations are eminently feasible for implementation (and leave considerable fexibility in the details of implementation within the spirit that we propose), and their implementation can establish a roadmap towards wealth creation (rooted in infrastructure development in a broad sense) for the country. In the face of a national calamity in the form of 66% of large government projects having been abandoned since 1960, worth probably hundreds of billions of dollars, we suggest that every stakeholder in the federal state should ofer legitimacy of acceptance and support for the government's new direction in implementing these recommendations. Te current book lays out a feasible and realistic path to achieve this. Ten the government has the responsibility to act.

**Open Access** Tis chapter is licensed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence and indicate if changes were made.

Te images or other third party material in this chapter are included in the chapter's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the chapter's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder.

## **Index**

**NUMBERS AND SYMBOLS** 1004 Housing Estate, 34, 78–80

#### **A**

Abacha, S., 169 Abandoned projects diagnostic review, 213–214 funding challenges, 214–215 research recommendations, 219 response distribution by respondent type, 94–97 variable diferences between completed projects and, 94–99 World Bank/IMF assistance, 214–215 *See also* Completed projects; Project completion Abandonment rate, 3, 32, 221, 223 Abandonment risk, 226 Abdullah, B.C., 81 Abimbola, A., 2, 17 Abuja International Airport, 34, 70–71 Abuja Mass Federal Housing Project, 34, 81 Abuja National Library, 34, 83–84, 129–132, 135, 213

Accugas, 156, 158 Adeloye, O., 188, 189 Agency Report, 173 Aggregated success factors, 101–103 Ahmed, M., 163 Airtel Nigeria, 33, 66–67 Ajakaiye, A., 74 Ajaokuta Steel Company, 189, 193 Ajaokuta steel plant project, 17, 28, 33, 62–63, 187–196 diagnostic review, 214 PPP revival, 191–192 project construction and cessation, 189–191 project initiation, 187–189 state of asset, 193 success variables, 212–213 Akashi Kaikyo Bridge, 17 Alexander Gray, 88 Alli-Balogun, G., 188 Amaize, E., 140 Ameh, O. J., 17 Amzat, A., 189 Anigbogu, N. A., 17 Annual budget, 3 Attitude, 18, 20 Audit Bureau, 220, 227

Ayangade, J. A., 17 Aziz, W.N.A., 81

#### **B**

Babangida Administration Egbin Power Station, 54, 152 Tird Mainland Bridge, 52, 144–147 Baker, B. N., 11, 12 Barrett, M., 31 BBC News, 184 Belassi, W., 11 Benaroch, M., 31 Benchmarking, 206 Berlin Brandenburg Airport, 4 Bhaktar News Agency, 179 Bias, 93 Bi-Courtney Aviation Services (BASL), 72 Bi-Courtney Highway Services, 162–164, 166 Big-man decision-making, 203–205, 212, 225 Bogdan, R., 28 Bouygues, 54, 151 BUA Group, 192 Budget, *see* Annual budget Budget allocation, 205 Budgeting, 216–217, 219 Budget overruns, *see* Cost overruns Budget size, 110 Buhari Administration Ajaokuta steel plant project, 190 Egbin Power Station, 152 Lagos-Badagry Express Road, 168 Lagos-Ibadan Express Road, 164, 166 Lagos Light Rail Project, 170 military coup, 190 Second Niger Bridge, 138, 140–141, 143

Tird Mainland Bridge, 145 Zungeru Hydropower Plant, 180 Bureau of Public Enterprise (BPE), 192, 225 Bureau of Public Procurement, 203 Burke, C., 169 *Business Day*, 140, 142

**C**

Calabar Power Station, 33, 76, 154–159 Calabar Seaport, 34, 76 Cambridge Economic Policy Associates, 167 Carter Bridge, 1, 144 Case studies, 32–36 *See also Individual case studies* Centralized decision-making, 203–205, 212, 225 Chandler, M. K., 11, 12 Change fexibility, 10 Chernobai, A., 31 China Civil Engineering and Construction Company (CCECC) Abuja International Airport, 71 Lagos-Badagry Express Road, 50–51, 167, 169–172 China Exim Bank, 61, 178 China National Engineering Electric Co. Ltd (CNEEC), 56, 178 China Railway Construction Corporation, 171 Chris, 83 Chua, E. H., 31 Civil servants, 220 Cleaner Lagos Initiative (Visionscape), 34, 87–88 Cleland, D. I., 12 Colonial period, 1 Communities resettlement, 179

Completed projects econometric predication of cost and schedule overruns, 108–114 response distribution by respondent type, 94–97 variable diferences between completed projects and, 94–99 *See also* Abandoned projects; Project completion Completeness measurement, 193 Complexity, 10 Composite variables, 94 *See also* Factor analysis Confrmatory factor analysis, 120 Constantinides, P., 31 *Construction Review Online*, 172, 178 Contractor management, 21 Contractor selection, 103, 107, 110, 113, 115, 116, 130 Contractors correlation with other respondent types, 94–97 cost overruns, 126 opportunism, 205 probability of project completion, 124 response distribution by project outcome, 96, 100 Control, 21 Control variables, 106, 110 Corkin, L., 169 Corruption, 22, 200 Abuja National Library, 130 Delta State (Oghareki) Power Plant, 57, 181–184 Delta Steel, 189 econometric analysis, 94, 102, 103, 110, 113, 115–117 Lagos-Ibadan Express Road, 162 new project management approaches, 212

research fndings, 199, 225 Tird Mainland Bridge, 146 *See also* Fraud prosecution Cost overruns, 17, 111, 226 Abuja National Library, 131 Ajaokuta steel plant project, 193 Calabar Power Station, 157 Delta State (Oghareki) Power Plant, 181 efects of corruption on, 117 Egbin Power Station, 152 Lagos-Ibadan Express Road, 165 Olusegun Obasanjo Presidential Library, 133 by respondent group, 125–126 Zungeru Hydropower Plant, 179 CPR Newsroom, 61 Creswell, J., 28 Crossrail project, London, 4 Currency, 1

#### **D**

Data analysis, *see* Econometric analysis Davnotch Nigeria Limited, 181, 182 Dawson, G. S., 31 Debt, 3 Decision-making, 203–205, 212, 225, 227 Delays, *see* Schedule overruns Delta State (Oghareki) Power Plant, 33, 57–58, 179–184, 200 Delta Steel, 189, 192 Denver International Airport, 17 Design build fnance operate transfer (DBFOT) model, 140 Design, fnance, build, operate and transfer (DFBOT) model, 138 Disaster Monitoring Constellation System, 66

#### **E**

Echewofun, S., 178 Econometric analysis, 5, 35, 93, 199 correlations among independent variables, 117–120 econometric predication of cost and schedule overruns, 108–114 economic predication of project completion, 104–108 factor analysis, 101–103, 120–121 logistical completion probability regression by respondent group, 123 objectivity of, 114 response distribution by respondent type, 94–97 variable diferences between completed projects and, 94–99 robustness analysis, 125–126 specifcation of logistical regression, 123 Economic and Financial Crimes Commission (EFCC), 60, 181, 183 Economic growth, 3 *Economist*, 153, 158 Edozien, L., 179, 180 Education Ministry, 131 Egbin Power Station, 33, 54–55, 151–154 Eko bridge, 144 Elbe Tunnel, 17 Elebiju, A., 163, 167 Electricity Transmission Network, 141 Empowerment for Unemployed Youth Initiative, 183, 184 Exploratory factor analysis, 120 External factors, 20

#### **F**

Factor analysis, 101–103, 120–121 *See also* Success factors Factors, 94 *See also* Success factors Fashola, B., 164, 171 Federal Airports Authority of Nigeria (FAAN), 72 Federal Bureau of Statistics, 225 Federal Civil Aviation Authority (FCAA), 74 Federal Crime Agency, 181, 183 Federal Integrated Staf Housing (FISH) programme, 81 Federal Mortgage Bank of Nigeria (FMBN), 81 Federal Roads Maintenance Agency of Nigeria, (FERMA), 161 Festac Town Federal Housing Estate, 34, 78–79 Financial planning, 142, 200 First Niger Bridge, 137 Fiscal Responsibility Commission, 64 Fisher, D., 11 Flyvbjerg, B., 2, 9, 12 Foreign debt, 3 Foreign direct investment, 3 Fortune, J., 12, 13 Fourth Mainland Bridge, 147 Fraud prosecution, 221

#### **G**

Gbadamosi, B., 172 Germany, 3 Al-Ghafy, M. A., 12 Gitto Group, 55, 82, 155 Global Energy Monitor Wiki, 182 Global Infrastructure Nigeria Ltd (GINL), 192 Global Legend Integrated Concept Company, 178

Godswill Akpabio International Stadium, 33, 68–69 Gopal, A., 31 Gosain, S., 31 Governance, 101, 103, 226 Olusegun Obasanjo Presidential Library, 134 Zungeru Hydropower Plant, 180 Governance structure, 21 Government changes, 106, 110, 154, 166 *See also* Military coups Government oversight, 205–206 Government project management approaches, 207–209 Government projects, 2–3 abandonment rate, 3, 32, 221, 223 *See also* Very large projects Grant, A. M., 28 Gwagwalada Specialist Hospital, *see* University of Abuja Teaching Hospital (UATH)

#### **H**

Henisz, W. J., 20 HFP Engineering, 77 High-level political priorities, 216 Hinkin, T., 30 Hitachi Company, 54, 151 Hough, G. H., 9, 15, 18 Huber, T. L., 31 Hydroelectric Power Producing Areas Development Commission (HYPPADEC), 178

#### **I**

Ibori, J., 180, 182, 183 Ibrahim, A., 162 Ihua-Maduenyi, M., 170 Ilesanmi, T. A., 163, 167 IMF assistance, 214–215 Independent power plant (IPP), 57, 180 Independent variables, correlations mong, 117–120 India, 207, 210 Indonesia, 209 Infation, 3 Infrastructure Concession Regulatory Commission (ICRC), 140 Infrastructure development projects, 2–3, 137 *See also* Very large projects Institutional changes, 216–219 Intent, 18 International arbitration, 192 Interviewees, 36, 114 *See also* Respondent types

#### **J**

Jigawa Airport Project, 34, 73–74 Jimoh, I. F., 3, 164 Jonathan Administration Abuja National Library, 131 Calabar Power Station, 155, 156 Egbin Power Station, 153 Lagos-Badagry Express Road, 167 Lagos-Ibadan Express Road, 49, 163, 164, 167 Nigeria Satellite 2, 65 Presidential Abandoned Projects Audit Commission, 2 presidential library, 134 Second Niger Bridge, 138–139, 142–143 Subsidy Reinvestment and Empowerment Programme (SURE-P), 85 Zungeru Hydropower Plant, 177 Joslin, R., 12

Julius Berger Nigeria Calabar Seaport, 76 Godswill Akpabio International Stadium, 68 Lagos-Ibadan Express Road, 50, 164, 165 Second Niger Bridge, 53, 138, 140 Tird Mainland Bridge, 52

#### **K**

Kanji Dam, 33, 63–64 Kariba Dam, 20 KEPCO, 55, 153 Al-Khalil, M. I., 12 Kim, S., 31 King, W. R., 12 Kosynski, B., 31 Kupferman, S., 181, 184

#### **L**

Lagos-Badagry Express Road, 33, 51, 167–173, 214, 215 Lagos-Ibadan Express Road, 33, 50, 161–167 Lagos Light Rail Project, 170–171 Lagos MMA2 Airport, 34, 72 Lagos State Government (LSG), 51, 163, 171, 172 Lagos State Waste Management Authority (LAWMA), 34, 85–87 Langer, N., 31 *Large Government Project Strategy and Budgets Ofce*, 216–220 Lessard, D. R., 13–15 Likert scale, 30 Locatelli, G., 22 Loch, C. H., 21 Locke, D., 12

Logistical completion probability regression by respondent group, 123 Logistical regression, 123 *London Times*, 1 Louise, F., 1 Lunineau, F., 31

#### **M**

Macaulay, O., 181 Mainland bridge, 144 Major programmes, *see* Very large projects Mambilla Hydroelectric Power, 33, 60–63 Mani, D., 31 Marskson, I., 181 Martin, C., 11, 12 Marubeni Consortium, 54, 55, 151, 153, 155 Matusevich, M., 187, 190, 191, 195 Megaprojects, *see* Very large projects Military coups, 152, 190 Miller, R., 13–15 Ministry of Large Government Projects, 218–221, 227 Misic, S., 11, 12 Moeini, M., 31 Morris, P. W., 9, 15, 18 Müller, R., 12 Murphy, D. C., 11

#### **N**

Nairaland Forum, 87 *NAN*, 168, 172 *Nation*, 164 National Library of Nigeria, *see* Abuja National Library National Integrated Power Project (NIPP), 55, 59, 154–157

National Space Research and Development Agency (NASRDA), 65, 66 Nebo, C., 178 Niger Delta Power Holding Company (NDPHC), 59, 154, 155, 158 Nigeria annual budget, 3 currency, 1 debt, 3 economic growth, 3 foreign direct investment, 3 funding applications to the World Bank, 142 government projects, 2–3, 17–18 (*see also* Very large projects) independence, 1 infation, 3 name, 1 population growth, 3, 223 unemployment, 3, 84, 85 Nigeria Bulk Electricity Trader (NBET), 158 Nigerian Communications Commission (NCC), 67 Nigerian Electricity Regulatory Commission (NERC), 155 Nigerian naira (currency), 1 Nigerian Steel Development Authority (NSDA), 187, 189 Nigerian Telecommunications Limited (NITEL), 33, 68 Nigerian Youth Empowerment Scheme (N-Power), 34, 84–85 Nigeria Satellite 1, 33, 66 Nigeria Satellite 2, 33, 65–66 NS Energy, 61 NSIA, 138, 140 Nwokocha, A., 156

**O** Obasanjo, O. Abuja National Library, 129, 130, 135 Ajaokuta steel plant project, 188–192 Lagos-Ibadan Express Road, 161 National Integrated Power Project (NIPP), 154 Omoku Power Plant Station, 60 Tird Mainland Bridge, 144 *See also* Olusegun Obasanjo Presidential Library Obienyi, C., 86 Ochei, V., 181, 183 Ochonma, M., 168 Odunmbaku-Wilson, B., 169 Odupkani power plant, *see* Calabar Power Station Ofce of the Head of the Civil Service of the Federation (OHCSF), 81 Ogemudia Stadium, *see* Samuel Ogemudia Stadium Oghre, G., 182, 183 Oguntola, S., 89 Okafor, C., 178, 184, 192 Okechukwu, N., 140 Okedu, K. E., 154 Okei-Odumakin, J., 172 Okeowo, G., 172 Okereke, O. C., 12, 17 Okonjo-Iweala, N., 142 Okowa, I., 182 Olatunji, O. A., 17, 195 Olawale, A., 192 Olawoyin, O., 165, 171 Oliomogbe, H., 183 Olisah, C., 138, 170 Oliveira, N., 31 Olusegun Obasanjo Presidential Library, 34, 82, 133–135

Omoku Power Plant Station, 33, 59–60 Omoregie, A., 17 Onitsha, 188 Onolememen, M., 163, 164 Opeyemi, D., 170 Orusi, K., 183 Osemenan, I., 17 Osondu-Oti, A., 169 Otukpo Dam, 33, 64–65 Outsourcing, 212 Overspent, *see* Cost overruns Owners correlation with other respondent types, 94–97 cost overruns, 125 probability of project completion, 124 research recommendations, 218, 227 response distribution by project outcome, 96 Oyeyinka, O., 188, 189

#### **P**

Peculiar Ultimate Consult, 70 Personnel, 220 Pilot schemes, 214 Pinto, J. K., 12 Planning, 20 *See also* Financial planning; Portfolio planning; Project planning; Resource provision and planning Poindexter, G., 178 Political priorities, 216 Popper, K., 28 Population growth, 3, 223 Port and Terminal Multi-Services Limited (PTML), 75 Portfolio planning, 216–217 Poverty, 3 Power Links, 154

Power Sector Nigeria, 154, 155 *Premium Times*, 170 Presidential Abandoned Projects Audit Commission, 2, 4 Presidential Infrastructure Development Fund (PIDF), 138 Presidential powers, 203, 212–213, 218 Project abandonment, *see* Abandoned projects; Abandonment rate Project completion economic predication of, 104–108 efect of corruption on, 115–117 logistical completion probability regression by respondent group, 123 Project defnition, 15, 18 *See also* Project shaping Project design, 13 Project execution, 219–220 Project goals, 103, 111, 114, 116 Project management, 9, 207–209 *See also* Project success frameworks Project Management Institute (PMI), 9 Project management methods, 226 Project planning, 219 Project shaping, 13–15, 17, 18 *See also* Project defnition Project success factors, *see* Success factors Project success framework, 13–15 PSL Engineering & Control, 183 Public debt, 3 Public-private partnership (PPP) Ajaokuta steel plant project, 191–192, 194 India and Tailand, 210 Lagos-Ibadan Express Road, 162–164, 167 Lagos MMA2 Airport, 72 research recommendations, 215, 219 Second Niger Bridge, 138, 140, 143 Public sector investment, 2

#### **Q**

Questionnaires, 4, 28 design and execution, 30–32 econometric analysis, 5, 35, 93, 199 correlations among independent variables, 117–120 econometric predication of cost and schedule overruns, 108–114 economic predication of project completion, 104–108 factor analysis, 101–103, 120–121 logistical completion probability regression by respondent group, 123 objectivity of, 114 response distribution by respondent type, 94–97 robustness analysis, 125–126 specifcation of logistical regression, 123 variable diferences between completed projects and, 94–99 strengths and disadvantages, 28–31

#### **R**

Radford, D., 17 Radujkovic, M., 11, 12 Rail line, 189 Railway system, 169 *See also* Lagos Light Rail Project Raw materials, 188 Research fndings, 199–206 Research methodology, 4, 27–28 case studies, 32–36 (*see also Individual case studies*) interviewees, 36 questionnaire, 28–32 sample projects, 32–34 (*see also Individual projects*)

Research recommendations, 212–221 longer-term structural changes, 215–221, 226–227 short-term changes, 213–215 Resource management, 20 Resource provision and planning, 103, 115, 116 Respondent disagreement, 104, 108, 115 Respondent types cost overruns by, 125–126 logistical completion probability regression by, 123 response distribution, 94–97, 104 Reynolds Construction Company (RCC) Abuja National Library, 83, 130–131 Lagos-Ibadan Express Road, 50, 164, 165 Second Niger Bridge, 53, 140 Tird Mainland Bridge, 52 Risk management, 21 Risks, 13 Rivard, S., 31 Road building, *see* Lagos-Badagary Express Road; Lagos-Ibadan Express Road Robustness analysis, 125–126 Rolls Royce, 183, 184 Roosevelt, F. D., 133

#### **S**

Sabherwal, R., 31 SageTravels, 73 Sahara Power Group, 55, 153 Salau, S., 76 Samuel Ogemudia Stadium, 33, 70–71 Sanwo-Olu, B., 170, 171 Sayles, L., 11, 12 SCC Nigeria Limited, 64

Schedule overruns, 114 Ajaokuta steel plant project, 190 Calabar Power Station, 155 Egbin Power Plant, 152 Lagos-Ibadan Express Road, 163, 165 by respondent group, 126–128 *See also* Time delays Second Niger Bridge, 33, 53–54, 137–143, 166, 215 Serious Fraud Ofce (SFO), Nigeria, 221, 227 Serious Fraud Ofce (SFO), UK, 183, 184 Seven Energy, 55 Shagari administration 1004 Housing Estate, 80 Ajaokuta steel plant project, 188 Egbin Power Station, 151 military coup, 190 Tird Mainland Bridge, 137, 145 Shaping process, *see* Project shaping Shibayan, D., 182, 183 Shiroro Hydroelectric Power Station, 33, 58–59 Shleifer, A., 22 Shonekan, E., 145 Shwarka, M.S., 17 Sinohydro Corporation, 56, 60, 178 Slevin, D. P., 12 Sole administrator, 193 Southern Integrated Energy Limited, 181 Soviet Union, 187–189, 191 Stage gate process approach, 9 Stakeholders, 20, 103, 111, 115, 116, 200 Abuja National Library, 130, 132 Lagos-Badagry Express Road, 168, 173 Lagos-Ibadan Express Road, 167 Olusegun Obasanjo Presidential Library, 134

Tird Mainland Bridge, 146 Zungeru Hydropower Plant, 180 State-owned enterprise (SOEs), 167, 169, 210 Strategic plans, 216 Structural changes, 215–221, 226–227 Structural equation modelling (SEM), 120 Subsidy Reinvestment and Empowerment Programme (SURE-P), 34, 85 Success factors, 10–13, 101–103, 114–115, 199, 224 economic levers, 226 efects on cost and schedule overruns, 108–114 efects on probability of project completion, 104–108 extended theoretical framework, 18–21, 30 qualitative description by project, 201, 202 statistical comparison between projects, 200, 204 Zungeru Hydropower Plant, 179–180 *See also* Factor analysis Sunstein, C. R., 2 Supervision, 21, 111, 115, 116 cost overruns, 125 probability of project completion, 124 research recommendations, 219, 227 Supervisors correlation with other respondent types, 94–97 research recommendations, 218 response distribution by project outcome, 96, 99 SURE-P, 34, 85 Survey, *see* Questionnaires Sydney Opera House, 17

**T** Tallon, P. P., 31 Taylor, S. J., 28 Team management, 21 Tailand, 208, 210 Tird Mainland Bridge, 33, 52, 137, 140, 143–148 Tian, F., 31 Time delays, 17 *See also* Schedule overruns Tin Can Island Port, 34, 75 Tinubu, B., 170 Tiwana, A., 31 Tractebel, 179, 180 Training, 220 Transparency, 220 Tukel, O., 11 Tyajz Prom Export (TPE), 62, 188, 189 U Uduaghan, E., 181, 183 Ugwu, E., 90 Umar, M. I., 76 Umoh, N., 81 Uncertainty, 10 Unemployment, 3, 84, 85 Empowerment for Unemployed Youth Initiative, 183 United Kingdom government projects, 3 public sector investment, 2 University College Teaching Hospital (UCH) Ibadan, 34, 87–89 University of Abuja Teaching Hospital (UATH), 34, 88–90 Unongo, P., 187 Urhobo Today, 183

#### **V**

Vanguard, 84, 85, 140, 141, 184 Variable groups, 101 *See also* Success factors

Variables composite, 94 independent, 117–120 *See also* Success factors Very large projects, 2–3 budget allocation, 205 centralized decisionmaking, 203–205 corruption, 22 defnition, 9 high-level political priorities, 216 India, 207 Indonesia, 209 institutional changes, 216–219 Nigerian context, 17–18 outsourcing, 212 portfolio planning and budgeting, 216–217 project execution, 219–220 project management, 9 project success factors, 10–13 project success framework, 13–15 extended theoretical framework, 18–21, 30 sample projects, 32–34 (*see also Individual projects*) Tailand, 208 Victoria Garden City (VGC) Housing Estate, 34, 77–78 Vishny, R. W., 22 Visionscape, 87–88

#### **W**

Wall, T. D., 28 Wengfu Ltd, 81 White, D., 12, 13 Wikipedia, 49, 68, 152 World Bank, 142, 170, 214–215 World Bank Partial Risk Guarantee, 158

World Highways, 165 Wu, S. P.-J., 31

#### **Y**

Yar'Adua, U. M., 155 administration Ajaokuta steel plant project, 192 Calabar Power Station, 155 Lagos-Ibadan Express Road, 163, 166 Yenagoa International Cargo Airport, 34, 73

Young Bong, C., 31 Youth unemployment, 84, 85 Empowerment for Unemployed Youth Initiative, 183

#### **Z**

Zungeru Hydro Community Relations Committee (CRC), 178 Zungeru Hydropower Plant, 33, 56, 153, 177–180 Zvecan Consulting and Engineering Ltd., 81