Nigeria To Establish National Airline “Preferred Partner”

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The Nigerian government is working fast to establish a national airline. It is believed that the government selected “a preferred partner”, and they are currently in the process of finalizing a full business scale. The minister of aviation, Hadi Sirika, is keeping the preferred bidder’s identity confidential.

It comes at the same time the Nigerian government’s multimillion-dollar maintenance overhaul program is coming into place. Nigeria’s proposed MRO facility will serve the maintenance needs of airlines in West and Central Africa, as well as the maintenance needs of its national airline and African leasing company.

The Nigerian Aviation Minister, Hadi Sirika, said that the MRO would be structured using a Build Operate and Transfer (BOT) model. The government will be both the grantor of the concession and a facilitator of the project. A private partner consortium will build, finance, operate and maintain the proposed facility for the agreed-upon concession period. Establishing aircraft maintenance facilities in Nigeria would help airlines repair their aircraft there, saving Nigeria $117 million a year in maintenance costs.

The cost of a C-Check is at least $2.8m for Nigerian airlines, whereas competitors pay around $500,000. In addition, insurance premiums paid by Nigerian airlines are four times higher than other airlines. As a result, maintaining a Nigerian aircraft would be at least half the cost if done in house.

Sirika said that the consortium will consist of an independent MRO company, a real estate developer, a construction company, and an institutional investor. The proposed facility will have the capacity to serve both narrow- and wide-bodied aircraft maintenance requirements and will be based in Abuja, Nigeria.

As for the preferred partner for the soon-to-be-established national airline, the Minister stated that this move would enable Nigeria to maximize the benefits derived from bilateral air services agreements (BASA). By doing this it will take full advantage of the Single African Air Transport Market (SAATM), introduce competition, leading to competitive fares and better services, and also generate jobs.

Nigeria Air is not the first national carrier run by the Nigerian government. Nigeria Airways, in which the government owned the majority stake, closed in 2003. Air Nigeria, a later iteration of Nigeria’s flag carrier set up as a joint venture with Virgin Group, terminated operations in 2012.

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