MMA2 posted losses for 11 years
The Murtala Muhammed Airport Two (mma2) has been posting losses for the past 11 years, the Chairman, Bi-Courtney Aviation Services Limited (BASL), operators of the terminal, Dr. Wale Babalakin (SAN), has said.
According to him, this is contrary to the views of many people, as the loss is due to the failure of government, through its Federal Airports Authority of Nigeria, in upholding the Public-Private Partnership (PPP) agreement the agency entered into with BASL.
“We built the MMA2. We’ve been running at a loss for the past 11 years. But to the undiscerning person, we are making a lot of money without knowing the cost of putting that infrastructure on the ground,” Babalakin told journalists while speaking on the side-lines of the 60th Anniversary/8th Fellowship Conferment Lecture and Ceremony of the Nigerian Society of Engineers in Abuja.
When asked to quantify the loss, he said, “That will be an event for another day.”
Babalakin, who had earlier delivered a lecture on the ‘Constraints of implementing infrastructure projects through public private partnership’, outlined some of the challenges encountered by private investors in Nigeria, using BASL as an example.
He told his audience that Bi-Courtney Aviation Service did not win the bid for the construction of the MMA2 but later handled the project, being the reserved bidder.
He said the Federal Ministry of Transportation had called upon BASL one year after the winner of the bid could not deliver on the project.
Babalakin said, “The design given to us was completely inadequate for a rural airport and definitely totally inappropriate for an airport in one of the largest cities in Africa. At our own cost, we redesigned the terminal, seeking to compare it with the Johannesburg domestic airport.
“We delivered on the project on time and thus created the first commercial terminal in Africa to be funded by private capital.”
He said after the facility was completed, FAAN began to violate the terms of agreement that were reached before the domestic terminal was built.
He said, “It (FAAN) began, contrary to the existing agreement, to run another terminal next door to us, taking away 60 per cent of our traffic and totally disrupting our cash flow and making it extremely difficult to meet our obligations on the project. It actually created a new terminal now known as General Aviation Terminal.”