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Ministry of Transportation clarifies MoU with MPH Rail Development Ltd. for Port Harcourt-Enugu-Calabar-Abuja Rail project



The Ministry of Transportation has responded to concerns regarding the Memorandum of Understanding (MoU) signed with MPH Rail Development (UK) Limited, a UK-based company, for the proposed Port Harcourt-Enugu-Calabar-Abuja rail project.

Recall that ThePressNG earlier reported the details of the MoU, which was signed on February 12, 2024, outlining the company’s involvement in designing, constructing, commissioning, operating, and transferring the rail line.

In a statement by Olujimi Oyetomi, Director of Press and Public Relations, the Ministry clarified that an MoU is non-binding, serving as an expression of intent rather than a legally enforceable agreement.

The Ministry emphasized that the MoU stemmed from an unsolicited proposal by the British African Business Alliance (BABA) in August 2019, submitted to the Ministry and subsequently to the Infrastructure Concession and Regulatory Commission (ICRC) in December 2023.

The Ministry of Transportation noted that it was attracted to the proposal because BABA/MPH committed to securing 100% private sector funding without relying on Nigerian government loans or debt, as stated in Article 3.3 of the MoU.

The commitment resulted in the Regulatory Commission granting approval and issuing a conditional OBC Certification on December 27, 2023, validating the project’s viability. The statement further indicated that COVID-19 significantly contributed to the delay between the initial proposal and the ICRC OBC Certification.

The statement further clarified that MPH Rail Development (UK) is the Special Purpose Vehicle (SPV) formed by BABA to execute the Port Harcourt-Enugu-Calabar-Abuja rail project. Typically, companies used for such projects have new formations with nominal shareholding to facilitate stakeholding during the investment phase.