Exclusive: N38bn Cargopolis Airport Project: Concessionaire writes Benue Governor, threatens to sue

By Danlami Nmodu

It began like a sweetheart, well  structured   business deal between the Benue State Government and a concessionaire, Cargopolis Development Company Ltd  for the development of a cargopolis airport and related infrastructure.

The seemingly rosy  relationship between the two parties when the project began has taken a sour twist  as the parties  are no longer at ease. In  fact, according to   documents obtained  by Newsdiaryonline,  Barristers and Solicitors to the concessionaire, Enyisan Lawrence & Associates  have recently written what they called a  ‘letter of demand notice’ addressed to   the Executive Governor of Benue State, Samuel Ortom making their case for compensation over alleged breach.

A letter seen by our correspondent gives an insight into how the seemingly rosy deal began.  It said: “Following presentations to the Government of Benue State in 2015/2016 by our client, Cargopolis Development Company Ltd for the development of a Cargopolis Airport Project and Infrastructural Support works for the state, the Government approved an initial Memorandum of Understanding in April 2016, which was subsequently followed with a signed PPP Agreement and Contract on 29th June, 20161.

“Consequent upon this PPP Agreement and Contract, a Notification was thus forwarded to the Federal Ministry of Aviation in order to begin the relevant authority procedures and to obtain the required guidelines and oversight functions of the Government.”

Newsdiaryonline can however authoritatively report that the tale has gone awry.Now the concessionaire has issued a  threat to sue the Samuel Ortom led Benue State Government if it failed to compensate it for  the alleged breach of agreement.

 The letter  by the solicitors addressed to the Executive Governor of Benue State,Government House Makurdi  dated  March 08, 2020 claimed  that Benue State Government has defaulted, thus they are demanding  compensation for the concessionaire amounting to N14,111,622,500.

Drawing from the agreement signed with the government, the letter said, “The total amount due to our client is N9,111,622,500.00 plus N5,000,000,000 for Intellectual Property Theft, amounting to N14,111,622,500.

“We hereby demand the immediate compensation of our client.”

The lawyers urged the Benue State Governor to take notice  “That your refusal to compensate our client, we will not hesitate to seek a redress in a court of law as this acts are malicious, wrongful, unlawful and above all constitute a fundamental breach of the PPP Agreement & Contract, in addition to acts bordering on Extortion, Money Laundering, as the Approved Amount of Equity of 15% has been approved by Benue State Government, every year from 2016 to 2019.”

“We sincerely hope that you will save the embarrassment, inconveniences, unpleasantness and expenses which may attend litigation”, the letter said.

Enyisan Lawrence (Esq)  who signed the letter to the Governor on behalf of the law firm stated matter-of- factly: “Please don’t expect any further notice from our chambers.”

The concessionaire reminded the governor with accompanying documents  of  timeline of events  thus: “2015. The PPP between Cargopolis Development Company  Ltd and Benue State Government gets state executive council approval. Thus the aerial survey of Makurdi Cargo Airport is conducted by the Concessionaire, and the Government and the Concessionaire agree on a location at Km 28, Makurdi to Lafia Road, for the Agricultural District and a further 15Km West of the Agricultural District to provide the Airside Infrastructure and facilities.

“2016. The Concessionaire and BNSG sign a Memorandum of Understanding,MOU with specific schedules and time lines and obligations to both parties for the development of Cargopolis Makurdi Airport Project at a Cost of N38B,with Benue State Government contributing 15% of the total cost or N5,7B in addition to the provision of Lands for the projects, assistance with Licenses, Approvals and Permits from all relevant authorities, and compensation for the economic crops, trees and structures on the affected lands or communities.

“Elaborate Ground breaking ceremony3 is approved by BNSG at the Agricultural site4, and the Federal Ministry of Aviation attends with delegation from the Ministry. A few months later, all six Aviation Parastatals5 visit the state to give approval for the project. The team is headed by Engr. Musa and Capt Alkali.

“2017. The Concessionaire begins the boundary fencing of the 264.25Ha Agricultural District after the Contract for the design of the Airport and Infrastructure was awarded to Messrs CAPDI AVIC of China. Both Messrs LLP Consult Ltd and Beyrus Nigeria Ltd, as registered sub-contractors to the project, begin the fencing of the Agricultural District with Approved materials.

The letter obtained by Newsdiaryonline further said “The Following actions and obligations were undertaken by the Concessionaire following the Executive Council of Benue State Resolution6 approving the project and agreements to contribute N5,7B. The Resolution was forwarded to the Concessionaire on 8th August, 2017 following the approval of the equity participation of 15% in the Project by BNSG.

“The amount approved was N5, 7b which the State Government subsequently misappropriated, and refused to remit to the Concessionaire. From this initial approved amount, the sum of N1, 0B was allocated and remitted to the state Ministry of Works as Capital Expenditure for 2017.

“MOU8 and Contract for the Engineering Design and Life Cycle Management of the Airport and Aviation Infrastructure awarded to CAPDI AVIC China for US$3M on July 24th, 2017.

“MOU and Tripartite Contract Agreement between the Concessionaire, Benue State Government and SinoHydro Corp Ltd of China for the construction of the Airport Project and provision of 85% Equity contribution, following Benue State Governments Exco Approval and the Signatures of Governor Samuel Ortom and Prof. Dennis Tyavya on the Agreements in China, on 13-14 April 2017, in which the Governor Signed as witness to the Agreement, during the Nigerian Governors Forum10 held in China.

“MOU and contract Agreements for the construction of Jet A1 Aviation Tank Farm, 23 Gas/Petrol Filling Stations to be built in all the Local Government Areas of the state, and a 50MW Power Plant signed with Messrs. Petrolex Group for N20B, on 13th November, 2017.

“MOU and Agreements for the construction of 120 Housing Units for the Aviation Village signed with Imperial Homes Mortgage Finance Ltd, on April 2017.

“MOU and PPP Agreement & Contract signed with Messrs.’ Sao Tome e Principe JDZ for the construction of both 3 and 4 star 100 Bedroom Hotel and Golf course on the Air side district of the airport, on January 2017.

The solicitors further said, “The Government of Benue subsequently issued a Certificate of Occupancy through its equity representative, Ministry of Works in a Letter with Ref MOW/EST/588/VOL.I/90 dated 10th May, 2017 for the Agricultural District of the project measuring 264.25Ha.

The letter also revealed that as a result of the above obligations, the Ministry of Works further committed the Government of Benue State to the Project as contained in its Obligations15 of Government in the PPP Agreement and Contract.

“Thus our surveyors were further instructed to mobilize to the site to develop the access road to the site and to conduct boundary survey for the Lands and economic trees for compensation and works at the Airside district with a size of 5,000Ha16. The Boundary Survey as undertaken by Messrs Digitec Surveys Nigeria Ltd and Har Kuhwa Associates Ltd. While the Compensation Data Survey and Analysis was conducted by Messrs Ambrose Ozioko & Partners.

“The State Government’s Obligation as contained in the PPP Agreement and Contracts is  amongst others to provide the access road  to the sites, and provide the Land unencumbered 18delivered to the Concessionaire for the Airport Project.

“A further request for the Certificate of Occupancy for the 5,000Ha Airside was not approved by the Government of Benue State, due to disagreements with the officials on the “Processing Fees” amounting to N500m demanded by the officials.

Despite all the seeming commitment so far by the  parties  thus far, the story suddenly took a  negative twist as the solicitors in the letter went   to great length to elucidate on what they termed the “Articles Of Default And Breach Of Agreement”

In that segment, Ortom was told in the letter,  “The State Government was Notified on several occasions by Letters of Notification of Default  in respect of its failure to meet its obligations as stipulated in the PPP Agreement and Contract.

“Following the consistent Letters of Default sent to the state Government, a meeting was scheduled between both parties and chaired by the Executive Governor, Mr. Samuel Ortom on June, 2017. The Governor subsequently directed the Honourable Commissioner for Finance and Economic Planning, Mr. David Olofu to issue a Demand Promissory Note  for the amount of N5, 7B. The Promissory Note Verbiage was issued to the Concessionaire together with the Letter to the State Executive Council for approval, in March 2018.

However the lawyers said, “The Exco forwarded the Verbiage and the covering Letter from Ministry of Finance to our offices, without its approved signature, clearly a deliberate intention not to honour its obligation.

The letter also listed several  Articles, Provisions and Obligations in the PPP Agreement of July, 2017 clearly shows that the Government of Benue State Government has defaulted in its obligations to the Agreement and Contract to construct the Cargopolis Makurdi Airport

The solicitors also asserted “It is on record that our client entered and signed the PPP Concession Agreement with the Benue State Government26 on the 29th June, 2016 for the construction of an International Cargo Airport and AgroHub along Makurdi-Lafia Road, with …Government Officials representing Benue State Government.”

Newsdiaryonline  reached out to  the Benue State Government  for its reaction to no avail. When the Chief Press Secretary, Mr. Terver Akase was contacted on Sunday 22 March 2020, he pleaded that he should be given time till the next day Monday 23rd March 2020. He however did not call back Monday and attempts to reach him afterwards failed. Messages sent to him via sms were repeatedly ignored  as there was no response even by Wednesday morning.

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