NIGERIA: Performance Assessment of Lagos Terminal Concessions

In 2005-2006, the Nigeria Ports Authority (NPA) entered into concession agreements for several bulk, breakbulk and container terminals, partly on a competitive basis (13 terminals), and partly through negotiation (12 terminals). The port concessioning program has now entered its 12th year.  Multiple concessions are close to expiry, while some have already reached the end of the concession term. Nine terminals have Supplemental Agreements with their tenure extended by 5 years for various reasons. Among the reasons for concession extension are encumbered areas, computation of throughput on export laden and empty Containers, relocation of terminal and wrong surveys prior to handover. A proper evaluation of the concession performance can be conducted. In addition, a framework needs to be developed for the approach for concession expiry.
In response to the Nigeria Ports Authority (NPA) request, PPIAF approved a grant to help the Authority develop a mechanism for proper assessment of the port concessions. On the basis of the results of the assessments, NPA would then decide whether to extend or re-tender the concessions (extension with the current operator or a renewal on competitive basis). This assignment was divided in to four parts as follows:

• The joint development by NPA and the port users of a methodology for assessing current and future terminal concessions in Nigeria
• The review of selected terminal concessions  with the support of an international consultant to ensure the transfer of the know-how to the NPA and the port users
• The establishment of a feedback mechanism on terminal performances to enable port users to fully participate in the assessment of the terminal performances.