Why Julius Berger Suspends Work on Lagos-Ibadan Expressway

Why Julius Berger Suspends Work on Lagos-Ibadan Expressway


A leading construction firm, Julius Berger Nigeria Plc has finally suspended work on the Lagos-Ibadan Expressway due to delays in the payment of agreed contract fees for work already done.

In a statement released by the firm, the construction company said: “It has become evident that the required adequate funding for the continuation of the project is not available. We trust that you will understand that, therefore, and as a consequence of the unacceptable financial risk to Julius Berger Nigeria Plc, we are left with no choice than to immediately commence suspension of the works on the project, as earlier notified.”

It should be noted that Fashola had recently issued a statement through his Special Adviser on Communications, Mr. Hakeem Bello that the two contractors working on sections of the Lagos-Ibadan Expressway, Messrs Julius Berger and RCC had given notice of suspension of work on the site.

According to Fashola, the letter from the Managing Director, RCC, Mr. M. Nakhla, which was dated June 2, 2017, stated, “In view of the irregular payment and the attendant cash flow problem, we shall be constrained to suspend further execution of work unless there is an appreciable improvement in the project’s cash flow and adequate funding arrangement is put in place for further works.”

He added that the letter was co-signed by the Division Manager, Julius Berger, Mr. W. Loesser; and the Commercial Division Manager, Mr. T. Meletschus.

Due to a huge outstanding debt of N8.94bn, it is also observed that the contractor handling the reconstruction and expansion works on the Section II from the Sagamu interchange to Ibadan, Reynolds Construction Company Nigeria Limited had suspended further work on the project.

RCC, in the letter, cited financial constraint as the course of their action, adding that the ministry should intervene in order to ensure the continuation of work on the site.