MoU with UK firm on rail project still at preliminary stage, not legally binding- FG

The Federal Government has clarified that the Memorandum of Understanding (MoU) recently signed with a United Kingdom firm,  MPH Rail Development (UK) Limited, for the design and construction of the Port Harcourt, Enugu, Calabar and Abuja standard gauge rail line on Public, Private Partnership (PPP) basis was not legally binding.

A statement issued on Sunday by Olujimi Oyetomi, Director, Press and Public Relations of the Ministry, explained that the initiative was still at its preliminary stage.

He added that the MoU provides only a platform for further engagement, discussion, scrutiny, and the provision of required guarantees by the parties to reach an agreement if the parties are satisfied.

Oyetomi noted that the clarification became imperative following comments and commentaries by certain persons, especially on social media concerning the status and implications of the MoU signed on 12th February 2024 by the minister, Senator Said Alkali with the firm.

Parts of the statement read, “For clarity, a Memorandum of Understanding or MoU is a non-binding agreement that states each party’s intentions to take actions, conduct a business transaction or form a new relationship.

“It is not a legal binding agreement.

“It provides only a platform for further agreement, discussion, scrutiny and the provisions of required guarantees by the parties to reach agreement if the parties are satisfied.

“The MoU in question arose from an unsolicited proposal presented by the British African Business Alliance, BABA, an association based in the United Kingdom with interest in businesses in Africa. It’s proposal was initially submitted to the ministry on 27th August 2019.

“As required, the business, Outline Business Case was submitted to the Infrastructure Concession and Regulatory Commission, ICRC, on 8th December 2023. The major attraction of the proposal is BABA/MPH’s initiative to achieve 100% private sector funding for the project with no loans or debt to the Nigerian government or any of its agencies as captured in the Article 3.3 of the MoU.

“The regulatory Commission on 27 December 2023 granted approval and issued a conditional OBC Certification. It is pertinent to note at this juncture that COVID-19 was a major contributor to the time lag between the initial proposal and the ICRC OBC Certification”.