Market
Nigeria is one of the largest producers of oil, a resource that accounts for almost the entire production capacity of the country. The drastic fall in the price of crude oil had a negative impact on the country’s finances, paralyzing existing production activity, including those related to the construction sector. Despite elections of a new Government in March 2015, the stalemate in infrastructural development continues, limiting the Group’s growth opportunities.
Significant events in the year
The Group is currently involved in the management of 9 projects, including the Inex road project and the Ogoni road project, managed through a 70% joint venture with the Rivers State Government. The table below shows quantitative values for the main projects in the portfolio at December 31, 2015:
|
Project | Group residual portfolio | Percentage of completion |
|---|---|---|
| Cultural Center | 248.5 | 38.5% |
| District 1 | 215.4 | 12.3% |
| Adiyan | 151.0 | 36.3% |
| Suleja Minna | 115.7 | 29.9% |
| Idu | 67.8 | 73.0% |
| Inner Northern Expressway | 33.5 | - |
| Ogoni | 27.3 | 86.0% |
| Isex | 8.0 | 89.4% |
| Gurara | 6.0 | 99.0% |
| Total | 873.2 |
Some key projects are described below:
Adiyan Waterworks Phase II (Adiyan)
The project consists in the construction of a water treatment plant with a capacity of 320,000 m3/day, intended to meet a part of the Lagos population’s water needs. At December 31, 2015, the civil works on the treatment plant were at an advanced phase of construction. The percentage of completion as of December 31, 2015 was 36.3%.
Suleja Minna
On January 16, 2015, the Group won the contract for the doubling of the carriageway of the Suleja Minna road (Phase II), an important route that allows access to the capital Abuja from the North-West. The project’s function is to improve mobility as well as facilitate the potential development of the entire region. The Client is the Ministry of Public Works of Nigeria. The value of the works amounts to approximately €112 million for phase II only, added to the value of the works for phase I, in which the Salini Impregilo Group is already involved.
2016 outlook
The works for projects in progress are an absolute priority for the country’s development. Maintenance work is being carried out on various contracts, with the exception of the Adiyan one, where the focus will be on procurement for electromechanical equipment.