The Lekki Free Trade Zone (LFTZ) project is an attempt by the Lagos State Government to consolidate on its stators as the commercial capital of Nigeria. By design, it is expected to transform Lagos State into a major hub of business in Africa.
Situated in the heart of Lekki, the LFTZ will on completion be home to an international airport to enable investor fly directly into the zone and save time and resources that would have been expended on the usual Lagos traffic. Estimated to cost of N71billion, the airport is designed to handle about five million passengers annually with provision for a modular terminal to handle future expansion.
It will also be home to the Lekki Greenfield Refinery, valued at $6billion (N900bn).
The zone will also accommodate Lekki Deep Seaport in Akodo. So far, the sum of $1.5 billion (about N237.3 billion) has been earmarked for development of the seaport. Speaking on the project, Commissioner for Commerce and Industry, Mrs. Olusola Oworu explained that the venture is being realised through a Public Private Partnership (PPP) arrangement. Lagos, she added hopes to execute it in collaboration with the Federal Government, through the Nigerian Ports Authority and a private investor – Lekki Port LFTZ Enterprise (LPLE).
“Presently, shareholders’ agreement has been executed, while preliminary works have started at the site. When completed, the port would relieve the pressure on the Apapa and Tin-Can Ports and also support business activities at the Lekki Free Trade Zone”, she explained, stressing that construction of the port would last for a period of 4 years.
“Over 10,000 jobs are projected to be created directly and indirectly during the construction period, while over 169,000 jobs would be generated directly and indirectly when it becomes fully operational,” she explained.
Already the Nigerian National Petroleum Corporation, NNPC, and the Lagos State Government, LASG, have signed a Memorandum of Understanding, MoU, for the allocation of 15 hectares of land for the proposed Lekki Greenfield Refinery. At the ceremony in Alausa, Ikeja, Group General Manager, Greenfield Refineries, NNPC, Mr Adebayo Ibirogba said the NNPC and the Lagos State Government have agreed to co-promote and co-invest in Hydrocarbon Industrial Park at the Lekki Energy City within the Lekki Free Trade Zone. “The momentous ‘Land for Equity’ commercial transaction is a shared risk investment, which envisages an investment package worth an estimated price of US$25 billion, spread on 1500hacters of land in the Lekki Energy City, to be implemented in four tranches, over the next 10 years, commencing in 2011. We shall henceforth, take physical possession of the first 550hacters of land allocated, in order to commence pre-construction work for the refinery” he said adding that the investment shall be in areas of a 200-300 BPD Refinery, 800MW power plant, fertilizer plant, petrochemical complex and the supply of crude oil and natural gas.
“It is our sincere hope that this initiative will provide a blue print for the development of several other proposals currently being discussed with other state governments who desire to establish hydrocarbon complexes similar to the Lekki Energy City,” he said.
Meanwhile, over 64 companies have indicated interest to invest over 25 billion dollars (N3.750 trillion) in LFTZ. According to Commissioner for Economic Planning and Budget, Mr. Ben Akabueze the companies include MasterCard, Guinness and a host of other companies. He said they picked interest in Lagos as a result of the series of Ehingbetti Economic summits held to draw attention of the world to the huge economic potentials in the state.
On ground the proposal for the LFTZ seems very fantastic, but implementation has been very slow in some of the key sectors expected to drive development in the zone.
For instance, beyond the razzmatazz the Lekki refinery is yet to take off, suggesting delay in commencement of operations against the envisaged 2017 that it is expected to commence operation. Among the problems that seems to have encumbered the project is funds, national policies and frequent changes in the top management of the Nigerian National Petroleum Corporation (NNPC) by the Federal Government.
Delay in passage of the controversial Petroleum Industry Bill (PIB) which is expected to redefine the operations of the oil industry in the country has been canvassed as another factor.
Notwithstanding the delay, the refinery is expected to produce 500,000 metric tons of liquefied petroleum gas (LPG) per anum, which will boost local production of LPG.