Benin-Asaba Expressway: SAN Urges FG to Exercise Caution Over Concession Revocation

 Benin-Asaba Expressway: SAN Urges FG to Exercise Caution Over Concession Revocation

Senior Advocate of Nigeria (SAN), Abiodun Olatunji, has advised the Federal Government to exercise caution in any attempt to revoke the 25-year concession for the Benin-Asaba Expressway, warning that concerns over the highway’s condition may not, by themselves, provide sufficient legal grounds for unilateral termination.

Olatunji gave the advice in a legal opinion prepared following an invitation to examine issues surrounding the concession agreement between the Federal Government and the Benin-Asaba Expressway Concession Company Limited (BAECC).

The 125-kilometre highway, which connects Benin City in Edo State with Asaba in Delta State, has been at the centre of controversy over deteriorating road conditions, prolonged traffic congestion and disagreements between the Federal Ministry of Works and the concessionaire.

According to the SAN, there must be clear evidence of abandonment, repudiation, total failure of performance or unreasonable delay before the Federal Government can validly invoke provisions that could lead to termination of the concession.

He stressed that the Minister of Works does not have a general or personal power to revoke the concession at will, noting that the contracting party is the Federal Government acting through the relevant ministry.

“Our considered opinion is that the Minister has no general or personal authority to revoke the concession at will,” Olatunji stated.

The lawyer said his review examined the Federal Government’s powers to intervene in the project, the circumstances under which the concession could be terminated, and the distinction between emergency intervention and outright termination of the concession.

He, however, noted that his opinion was based on a summary of the concession agreement and documents made available to him, and that the full agreement and related contractual documents would need to be reviewed before definitive conclusions could be reached.

Emergency intervention

Olatunji acknowledged the Federal Government’s responsibility to protect motorists and other road users where the condition of the highway poses an immediate danger.

He said such circumstances could justify immediate and proportionate emergency intervention, particularly where the concession agreement provides the government with step-in rights.

However, he explained that emergency intervention would ordinarily be directed at addressing immediate risks without automatically extinguishing the underlying concession arrangement.

The SAN further cautioned that a permanent takeover of the project, removal of the concessionaire, redesign of the route or appointment of replacement contractors could go beyond the scope of emergency intervention unless such actions are authorised under the concession agreement.

Possible contractual mechanisms, he noted, could include a valid change in scope, negotiated amendment, termination for convenience with applicable compensation, or a properly executed default-termination process.

He also argued that broad public-interest considerations, without compliance with the contractual provisions, may not by themselves extinguish rights relating to compensation, cure periods and lender protections.

Dispute over road condition

The legal opinion comes amid an escalating disagreement between the Federal Ministry of Works and BAECC over the state of the expressway and the pace of reconstruction.

The Ministry has alleged breaches of provisions of the concession agreement by the concessionaire and has reportedly proposed a mutual termination of the arrangement.

Minister of Works, David Umahi, had previously expressed concern over the condition of the highway following an inspection of the corridor with Edo State Governor, Monday Okpebholo.

The deteriorating condition of sections of the road, particularly during the rainy season, has resulted in severe traffic congestion and hardship for motorists travelling between Benin and Asaba.

BAECC, however, has disputed claims that the project has been abandoned, citing heavy rainfall, increased traffic volumes and the challenges associated with reconstructing a major highway while maintaining traffic flow.

The concessionaire has also pointed to ongoing earthworks, drainage construction, asphalt laying, carriageway expansion and other construction activities along different sections of the corridor.

During an August stakeholders’ meeting, Umahi also acknowledged some of the contractual complexities surrounding the project and sought the concessionaire’s agreement on proposed changes.

25-year concession

The Benin-Asaba Expressway concession dates back to 2023, with the Federal Executive Council approving the project on January 16, 2023.

The concession agreement was subsequently signed on May 23, 2023, under a Design, Finance, Build, Operate and Transfer (DFBOT) model.

The arrangement provides for a 25-year concession period, including the construction phase. A 2026 transport-sector study prepared for the Japan International Cooperation Agency (JICA) also records the concession as running from May 2023 to May 2048 and identifies the project as being under implementation.

The expressway runs from Ring Road Roundabout in Benin City to Summit Junction in Asaba and serves as a major transport corridor linking the South-South, South-East and parts of the South-West regions.

Wider implications for road concessions

The dispute has implications beyond the Benin-Asaba corridor, as the project is one of several federal road concessions being implemented under the Highway Development and Management Initiative (HDMI).

The initiative was established to attract private-sector financing and technical expertise to the development and management of federal highways.

Olatunji’s opinion therefore places the dispute within the broader contractual framework governing public-private infrastructure partnerships, where the rights of government, concessionaires and lenders are defined by long-term agreements.

The SAN maintained that the Federal Government can address urgent safety concerns on the highway while preserving the contractual framework governing the concession.

He said the immediate priorities should include determining the extent of any contractual default, undertaking necessary remedial works, establishing responsibility for the interventions and resolving the wider dispute in accordance with the concession agreement.

The ultimate objective, he noted, should be the full restoration of the vital transportation corridor without allowing contractual disagreements to further delay relief for road users.