Nigeria is in talks with private investors to set up a national airline as it revamps it’s airport infrastructure and expands air capacity, Aviation Minister Osita Chidoka said.

Nigeria will spend about $2 billion within the next four years to rebuild old airport terminals and build new ones as demand for air travel in the country rises, Chidoka said in an interview with Bloomberg TV Africa in New York that will be aired on Oct. 3. The government wants to start a national carrier within the same period to tap from the growth.

“Conversations are on across many possible private sector organizations, both local airlines in Nigeria and then some international airlines,” Chidoka said. “It will be commercially run.”

Nigeria, Africa’s biggest economy and most populous country of about 170 million people, signed a $500 million loan agreement last year with the Export-Import Bank of China to fund new terminals in four cities including the capital Abuja, the commercial hub of Lagos, the southern oil center of Port Harcourt and the northern city of Kano. The contract was won by China Civil Engineering Construction Corp.

The government is also building 13 cargo airports across the country for the export of perishable agricultural produce such as pineapples, mangoes and tomatoes.

About $1 billion have been provided by the government for the current projects, with another $1 billion expected to be spent within the planned project duration of four years, according to Chidoka.

Largest Carrier

Nigeria liquidated its former national airline, Nigeria Airways, in 2003 and replaced it with Virgin Nigeria, a joint venture in which Richard Branson’s Virgin Atlantic originally held 49 percent. The airline changed its name to Air Nigeria in 2010 after Branson pulled out and ceased flying two years ago.

Lagos-based Arik Air Ltd., a closely held company, is the West African nation’s largest carrier with 26 aircraft in it’s fleet, according to its website. Its competitors include Aero Contractors Ltd., Dana Air, Med-View Airline Ltd. and Overland Airways Ltd.

The number of air passengers traveling both domestically and internationally in Nigeria surged to 3.75 million last year from 520,263 in 2003, according to World Bank data.

“We have to build infrastructure that matches our aspiration. Privatization of some operations of the airports may be on the cards,” said Chidoka. “It will most likely be airport management, things like that, collecting of revenues, managing lounges.”

To contact the reporter on this story: Chris Kay in Lagos at ckay5@bloomberg.net. To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net.

Tags: lagos, nigeria
Photo Credit: Exterior of Lagos' international airport. Juliana Rotich / Flickr