Foreign Mission Infrastructure News

Ministers of Ghana and Burkina Faso Express Satisfaction over Railway Projects Progress

By JAMES EZEMA

The state visit to Burkina Faso by the Leader of the people and government of Ghana, H.E.Nana Addo Dankwa Akufo-Addo in May, 2017, in which the two countries agreed to construct a railway interconnectivity between the two West African neighbours has become a reality.

The railway conception has come to a reality as construction will commence by September this year.
After series of deliberations by various structures put in place following the agreement made by the two Leaders of the Governments of the Republic of Ghana and Burkina Faso,, H.E. Nana Addo Dankwa Akufo-Addo and H.E. Roch Marc Christian Kabore, during a State visit to Burkina Faso in 2017.

They agreed then that railway interconnectivity between the two West African neighbours is an important factor to accelerate economic growth and development for the mutual benefit of the two nations and a Joint Committee of Experts was set up by a Memorandum of Understanding on January 16, 2018, between the two States, to facilitate the implementation of the railway interconnectivity.

Series of meetings of Joint Committee of Experts between the two countries resulted in the recommendation of the need to engage Transaction Advisors, whose role was to assist the Governments of the Republic of Ghana and Burkina Faso to review/undertake various studies and also assist in a procurement process to engage a private sector investor(s) to develop the proposed Railway Interconnectivity Project between the Port of Tema and Ouagadougou, on a Build, Operate and Transfer (BOT) basis.

Subsequently, on 16th November, 2018, a consortium of two firms, Messrs TEAM Engineering S.p.A. of Italy and Messrs Vision Consult Limited of Ghana were engaged as the Transaction Advisors for the project after going through the procurement process under the Ghana Public Procurement Act, 2003 (Act 663) as amended.

Messrs TEAM Engineering S.p.A. developed the Ghana Railway Master Plan in 2013 and are currently reviewing the plan to expand the rail network to meet present demands and to create an efficient rail transportation that will link important mineral potentials and centres of economic development; such as, free zone enclaves and industrial parks. Messrs Vision Consult Ltd. is currently leading a consortium to undertake feasibility studies for the Central Spine Railway Line from Kumasi to Paga.

The development of the project is being carried out in the following four (4) phases:
Phase 1: Feasibility Studies
Phase 2: Procurement of Private Sector Partner
Phase 3: Analysis of Technical Studies by Private Partner
Phase 4: Construction and Supervision

The proposed route or alignment starts from Tema through Mpakadan, which is currently under construction and expected to be completed by August, 2020. The line will continue from Mpakadan and will go through Hohoe, Nkwanta, Bimbila, Yendi, Tamale, Walewale, Bolgatanga, Paga, Po, Zabre, Tenkodogo, Manga and terminate at Ouagadougou.

In line with Government policy to connect all regional capitals by rail, a connection to the capital cities of Ho, Dambai and Nalerigu will be done. A branch line will also be constructed to Sheini to provide rail access to the huge iron ore deposits that have been discovered. The total length of the line, including the branch lines is approximately 1,200km.

The corridor has huge economic potential following the discovery, in commercial quantities, of mineral resources like iron ore, bauxite and manganese. Other potential traffic include, petroleum products, agricultural products, manufactured goods, construction materials, containerised cargo and passengers.

The Hon Minister and other officials from the Ministry of Railways Development, Ghana Railway Development Authority, Ghana Railway Company Ltd., as well as, members of the Press, were involved in the various processes of which three companies met the Joint Evaluation Committee.

The three (3) Firms/Consortia that substantially met the minimum evaluation criteria, arranged are:
African Global Development Sarl / Race Consulting Engineering LP / Kalliergos O.T.M. Consulting Engineering Company S.A. / NS-A Corp / Stichting Actieve Ondernemers Begeleiding
China Railway No. 10 Engineering Group Co. Ltd. / China Railway Engineering Design and Consulting Group Company Ltd. / Strategic Initiatives Ltd./Frontline Capital Advisors / Mota-Engil Group / Deutsche Bahn (DB) / Siemens AG / AIIM / GIBB / Quadrante / AB & David.

However, Frontline Capital Advisors have had their operating license as a Fund Management Company withdrawn by the Securities and Exchange Commission. The question as to whether or not this will affect their further participation in the process is currently under review. We are seeking advice from the Attorney-General on the subject matter. We will however, not allow this to delay us unnecessarily.

Request for Proposal Stage

The recommendation by the Joint Evaluation Committee from the Request for Qualification stage is currently going through an approval process to enable the issuance of the Request for Proposal to the pre-qualified firms as the third stage of the procurement process.

The draft Request for Proposal document has been prepared by the Transaction Advisors and currently being discussed for approval by the Joint Committee of Experts.
It is expected that the Request for Proposal will be issued within April, 2020 and the prospective investors will be given a period of two (2) months to study the relevant technical reports and submit Technical and Financial Proposals for consideration.

Heads of States’ Committee of Eminent Persons

A six-member Committee of Eminent Persons, three (3) representatives each from Ghana and Burkina Faso, has been constituted to be in charge of the last stage of the procurement process and will make recommendations to the two (2) Heads of States for their decision on the preferred private sector partner.

Timeline for Negotiations and Signing of Contract with Private Sector Partner

Upon the submission of the recommendation of the Committee of Eminent Persons and subsequent approval by the Heads of States of Ghana and Burkina Faso, negotiations will commence with the preferred private sector partner to reach a common ground for the signing of a PPP Agreement and Financing Closure.

Without any hindrances, we expect the negotiations to commence in August and concluded within a period of one (1) month to pave way for the commencement of the construction phase of the project.

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