By Atai Albert, Transventel LLC.
Nigeria’s proposed high-speed rail project has generated considerable public interest and debate. As discussions continue, the public deserves clarity on three key areas: how such projects are structured, how financing actually works at this scale, and why Nigeria’s recent engagement with China matters for infrastructure delivery.
How major infrastructure projects begin.
Government agencies regularly receive presentations from private consortiums proposing large-scale infrastructure projects. The Secretary to the Government of the Federation recently hosted De-Sadel Nigeria Limited and China Liancai Petroleum Investment Holdings for a formal presentation regarding proof-of-funds for a 4,000-kilometre high-speed corridor. Such meetings are standard procedure, conducted on the record. Following any presentation, the established next step involves verification and validation processes by relevant ministries, departments, and agencies. This sequence reflects how government evaluates major project proposals.
Understanding large-scale project financing.
Sixty billion dollars represents a significant sum that requires careful explanation. No serious financier transfers such amounts upfront as a lump sum. In large transport public-private partnerships, financing facilities are syndicated across multiple institutions, documented in phases, and drawn down against specific milestones. Disbursements follow engineering progress and verified achievements rather than announcements or agreements alone.
Project finance is typically repaid with revenues and secured on project assets and sovereign guarantees. It is true that African landscape is littered with white elephant projects but these failures are more prevalent in our corrupt public sector. Therefore, rather than writing off this opportunity on the basis of our past experiences, Nigerians should keep an open mind, stay alert and engage the promoters constructively.
Nigeria’s evolving partnership with China.
President Tinubu’s state visit to China in September 2024 elevated bilateral relations to comprehensive strategic partnership status. Subsequently, rail and energy cooperation has advanced from preliminary discussions to concrete transactions, including fresh Chinese development finance allocated for the Kaduna–Kano rail segment. The proposed high-speed rail programme operates within this established engagement framework, delivering infrastructure investment, technology transfer, and employment opportunities that align with presidential priorities established during the Beijing visit.
Institutional verification standards.
Questions regarding financing institution credentials and capacities are appropriate components of due diligence. Financial institution names, balance sheets, and operational capacities undergo verification through standard diplomatic and financial channels before any binding contracts or fund transfers occur. Government validation processes exist specifically to ensure proper verification before official commitments.
Investment fundamentals for infrastructure.
Major transport projects attract investment based on comprehensive return and risk assessments. Revenue models for modern rail systems extend beyond basic passenger service to include multiple income streams: inter-city transport services with market-responsive pricing, time-sensitive freight operations, logistics concessions at stations and associated dry ports, right-of-way telecommunications infrastructure, advertising opportunities, property value capture around station areas, depot maintenance services, and long-term operational contracts.
Revenue generation often begins before full system operations through phased commissioning schedules and advance capacity reservations. This diversified approach reflects standard practices for structuring multidecade transport concessions globally, addressing concerns about project financial viability through multiple revenue sources rather than single-stream dependence.
Evaluating technical capabilities.
Project partnerships require demonstrated technical competence. The current consortium has completed Africa’s first LNG-powered locomotive retrofit for the Nigerian Railway Corporation and collaborated with government on dual-fuel locomotive scaling initiatives designed to reduce operational costs and emissions. Such sustainability-focused achievements represent credentials that financial institutions evaluate when assessing engineering, procurement, and construction-plus-operations partnerships.
Understanding sovereignty protections.
Nigeria’s regulatory framework prohibits pledging strategic sovereign assets as security for infrastructure concessions. Government fiscal responsibility rules require that any contingent liabilities undergo management according to established protocols, scrutiny by designated oversight bodies, and disclosure per PPP regulatory requirements. Contracts reaching financial close operate under Infrastructure Concession Regulatory Commission monitoring throughout project duration until asset handback occurs. These institutional safeguards prevent inappropriate exposure of national resources.
Infrastructure development in context.
Major infrastructure proposals naturally generate intensive public discussion. However, productive policy dialogue benefits from distinguishing between legitimate procedural questions and speculative concerns. International media coverage of Nigeria’s rail initiatives and associated financing presentations has provided factual reporting that readers can verify independently.
Project development standards.
Contemporary infrastructure sponsors typically commit to transparency throughout PPP implementation pipelines, publishing milestone achievements and maintaining project financial viability through milestone-linked disbursements, transparent tariff and concession structures, independent technical auditing, and strict separation between project cash flows and sovereign financial obligations. Successful projects leverage international partnerships to reduce capital costs while maximizing local content requirements for domestic firms and workers.
Understanding these development processes enables citizens to engage constructively with infrastructure decisions that influence Nigeria’s economic trajectory and competitive positioning regionally and globally. Accordingly, De-Sadel Consortium should immediately begin the process of engaging and carrying the Nigerian people along and such interactions should be sustained in all stages and phases of the project.