The federal government has projected that the major international airports: the Murtala Muhammed International Airport (MMIA), Lagos, the Nnamdi Azikiwe International Airport, Abuja, the Mallam Aminu Kano International Airport, Kano and the Port Harcourt International Airport, Omagwa would be processing about 55 million passengers annually by 2048.
This was the estimate made by the Outline Business Case Report for the concession of the four major airports, titled: “Nigeria Four Airports PPP,” and made available by the Ministry of Aviation.
The report stated that the forecast of total traffic for the four airports in Nigeria was expected to grow on average at 5.3 per cent over the next 30 years, from 11 million passengers in 2017, to 55 million by 2048.
The report attributed the anticipated growth to the strong population growth and affluence of its population, noting that the concessionaires would be required to provide sufficient capacity to handle the expected amount of traffic.
“In addition to the terminals that are currently under construction, the Concessionaire is required to refurbish the existing facilities in Abuja and Port Harcourt. In Lagos a new terminal needs to be constructed and the existing MMA1 international terminal decommissioned.
“The Ministry aims to develop Nigeria’s major commercial airports and surrounding communities into efficient, profitable, self-sustaining, commercial hubs which will create more jobs and develop local industries,” the report stated.
It also disclosed that the federal government would like to use the PPP (Public, Private Partnership) model to leverage private sector participation and foreign investment to achieve the upgrade and development of new infrastructure at these airports in the fastest and most cost-effective manner.
On the scope of the project, the report stated that it fits well within the scope of the Ministry and the ICRC (Infrastructure Concession Regulatory Commission) and would help Nigeria to reach its objective in terms of air transport: developing and profitably managing customer-centric airport facilities for safe, secure and efficient carriage of passengers and goods at world-class standards of quality.
The report stated that work was on-going at the four airports designated for concession.
“At all four airports terminal construction is currently ongoing, initiated by the government, and assumed to be operational by 2020.
“The terminals will be part of the concession and the Concessionaire is expected to take these over and operate. Additionally, the Concessionaire is required to develop additional capacity to provide for the traffic demand until the end of the concession period,” the report said.
The report also observed that the airports in Nigeria are currently operating in a suboptimal environment, most notably due to the following factors that would have to be improved as part of the PPP programme: urgent need of infrastructure investments and modernisation.
“All Airports require investments in runway maintenance, navigation aids as well as terminal facilities; relatively low asset utilisation due to the limited opening hours of other smaller Nigerian airports; lack of terminal capacity as the airports fall short of gates, stands and check-in desks; the airports have not been designed as international hubs but operate separate international and domestic terminals.
“The aviation infrastructure needs to be prepared to facilitate the macro-economic demand of the forecast population growth and its increasing affluence. A private operator of the four main airports in the country will be able to operate the airports with an international standard and expand the facilities in accordance with traffic demand at each airport.
“Typically, on Airport PPP projects, the Authority sets minimum service levels for the Concessionaire to comply with. This will provide the Authority with a tool to set service standards for the operation of the terminals and secure a reliable high-level product,” the report also said.
It noted that a strong aviation industry provides the country with a high connectivity, both on a domestic and international scale. This has several economic and social benefits for the country as identified in this OBC (Outline Business Case). These include time and cost savings for companies, efficiency gains for the economy, increased connectivity for remote regions, and improved access to health care.