Developing a Risk-Adjusted Cost Estimating Framework for Public-Private Partnership Infrastructure in Nigeria

Cost estimation in public-private partnership infrastructure projects requires a fundamentally different methodology from conventional construction cost estimating, incorporating project finance risk variables, lifecycle obligations, and demand uncertainty dimensions that standard quantity surveying practice does not address. This study develops a risk-adjusted cost estimating framework for PPP infrastructure in Nigeria. A pragmatist philosophical stance underpins a multi-method design incorporating structured expert elicitation from 45 PPP practitioners, Monte Carlo simulation modelling, and empirical validation against 16 Nigerian PPP project datasets. The study integrates financial risk modelling techniques from project finance theory with quantity surveying cost management methodology to produce an original hybrid framework. Findings demonstrate that risk-adjusted cost estimates for Nigerian PPP infrastructure projects deviate from base cost estimates by 18% to 42% depending on project type and zone, with security risks, demand uncertainty, and regulatory change risks contributing most to the adjustment. Projects in North East and North West zones require the highest risk adjustments. The resulting Nigeria PPP Cost Estimating Framework (NPCEF) is validated on historical project data, demonstrating a 31% improvement in forecast accuracy over unadjusted estimates. This study makes an original methodological contribution to PPP project finance and quantity surveying scholarship, providing a practical tool for government transaction advisers and the Infrastructure Concession Regulatory Commission. Keywords: risk-adjusted cost estimating, PPP, infrastructure, Nigeria, project finance