Cost Performace of Road Construction Projects in Nigeria

Abstract

The construction of highways requires huge capital; therefore, to meet their performance goals, a significant amount of resources and meticulous preparation are needed. The study investigates the magnitude and causes of cost overruns in highway construction projects. A review of existing literature was conducted, followed by a focused group meeting to identify the cost-risks related to the construction of highway projects in Nigeria. Historical cost data on highway projects published by the Nigerian FMWH in 2017 served as a preliminary list of projects for the study, while cost data of more completed projects was gotten from highway engineers and quantity surveyors across Nigeria using the snowballing technique until 103 highway projects were identified. Major project participants were purposively chosen to fill out questionnaires on cost-risk factors associated with highway construction projects. The collection of primary data (risk factors) and secondary data (cost performance) was done simultaneously. The mean score (MS) and the severity of each of the factors were computed, while Pareto's rule was used to determine the significant risks. To determine the cost performance of the completed highway projects, the cost deviation of each identified project as well as the mean deviation of the total projects were calculated. The study identified six significant cost risks affecting federal highway projects in Nigeria. Further, findings revealed that Nigeria's federal highway projects have a mean cost overrun of 31.36%, and the probability of cost occurrence is 94.14%. Finally, findings show that 60% of federal highway projects in Nigeria experience very high cost overruns (of over 20 %), with their attendant effect on other project objectives.