President Bola Tinubu’s recent announcement regarding the Ibom Deep Seaport project in Akwa Ibom State has generated questions concerning the necessity of new federal authorization, given that the project’s first phase had already received clearance from the Federal Executive Council (FEC) under former President Muhammadu Buhari in December 2020.
Governor Umo Eno has called Mr. Tinubu’s intervention a significant approval for the project’s financing arrangement. However, insiders involved in the project have suggested that the state may not have needed another federal approval to move forward with its original investment structure, as the 2020 clearance reportedly allowed Akwa Ibom State to pursue private investors under a 60:40 financing model.
According to sources, this model required investors to provide 60 percent of the funding while the state would cover the remaining 40 percent. Eno has offered a different perspective, asserting that the recent approval will enable the federal government to provide a sovereign guarantee essential for attracting investors.
This raised further questions regarding whether a new financing arrangement has been negotiated, whether an investor has formally requested a sovereign guarantee, and if the Federal Executive Council has authorized this guarantee. This inquiry is significant as Mr. Tinubu had committed to building the seaport during his campaign rally in Uyo.
Since its initial approval in December 2020, which was estimated to cost $2.016 billion, the Ibom Deep Seaport project, listed among federal public-private partnership projects, has yet to commence construction. Former Governor Udom Emmanuel sought investors but faced setbacks due to complications surrounding the project’s location.
Eno’s administration has maintained efforts to progress the project, conducting feasibility studies and engaging potential investors. More recently, he met with prospective partners in Paris to discuss implementation timelines and secure investment commitments.
Despite the governor’s claims that the Federal Government’s approval will facilitate investor participation, he cautioned that this does not imply an immediate start to construction. The governor clarified that the approval signifies the federal government’s willingness to provide a sovereign guarantee, a critical factor for investor confidence.
As questions regarding the new financing structure and the implications of the proposed sovereign guarantee remain, scrutiny of the processes for accessing such guarantees and the potential financial liabilities incurred by the federal government continues.
