The Federal Government has approved the release of N127 billion to sustain federal road projects previously financed by the Nigerian National Petroleum Company Limited under the tax credit framework. The intervention shifts financial and supervisory responsibility to the Federal Ministry of Works following the oil company’s withdrawal from direct project funding.
Minister of Works David Umahi announced that the funds were authorised by President Bola Tinubu to ensure continuity on critical road corridors across the country. He stated that addressing the status of former NNPCL funded road projects initiated under Executive Order 007 April to May 2023, the Nigerian National Petroleum Company Limited will no longer directly pay contractors for these projects. The Federal Ministry of Works has officially taken over both project supervision and payment responsibilities, in line with new federal directives.
The funding transition follows the suspension of the Road Infrastructure Development and Refurbishment Investment Tax Credit Scheme, which had enabled selected companies to fund road construction in exchange for tax credits. Under the revised approach, projects will now be financed strictly through federal budgetary allocations.
The Honorable Minister disclosed that N127 billion has been released by Mr President for the continuation of these projects, underscoring the administration’s commitment to completing inherited infrastructure initiatives.
The N127 billion allocation provides immediate liquidity for contractors who faced uncertainty after the change in policy. It also signals an effort to prevent cost escalation and project abandonment. Despite the intervention, the Minister disclosed that completing all projects previously linked to the tax credit model would require about N7 trillion. The gap highlights the scale of outstanding liabilities and the fiscal burden ahead.
The ministry also addressed contract clarifications surrounding specific road corridors. Officials stated that the Abuja Kaduna road contract is being handled by Infoquest International Limited, correcting claims linking it to another firm. The clarification is aimed at reinforcing transparency and accountability in project execution.
Beyond financing, the government acknowledged operational setbacks affecting progress. Acts of vandalism, obstruction of drainage channels, and flooding on major highways have added to maintenance costs and slowed construction timelines. These factors compound the strain created by funding shifts and inflation in construction materials.
The ministry further confirmed that the Bodo Bonny Road project has been extended by 8.7 kilometres to connect with the East West Road. The expansion increases the strategic value of the corridor and integrates it into a broader transport network serving oil producing regions.
The policy adjustment marks a structural change in how large infrastructure projects are funded. The withdrawal of the Nigerian National Petroleum Company Limited from direct road financing closes a chapter in public private collaboration under the tax credit framework. The Federal Government now bears full financial exposure for the affected projects.
The N127 billion release stabilises immediate construction activity. It does not resolve the broader funding requirement. Sustained appropriations will determine whether the projects are delivered on schedule. The administration’s capacity to mobilise resources within fiscal constraints will shape the pace and completion of these national road assets.
