LAGOS —THE Federal Government has cancelled a $2.5 billion bid for its failing telephone company, Nigerian Telecommunications Ltd, NITEL, after the bidder defaulted on a $750 million down payment, the most recent of numerous setbacks to privatise the company since 2001, an official has said.

Bureau of Public Enterprises, BPE, is brokering the sale of 75 per cent of Nitel on behalf of the government. The New Generation Telecommunications Consortium won a $2.5 billion bid last October to purchase. It was supposed to pay $750 million by November 5, but more than three months later, it still has not paid up.

“We are not considering them anymore because they have failed,” Chukwuma Nwokoh, spokesman for Nigeria’s Bureau of Public Enterprises, said, weekend.

The proposed sale to the consortium, which Nigerian officials said includes China’s Unicom Ltd., Dubai’s Minerva and local company GiCell, had faced scrutiny before it was eventually cancelled. State-owned Unicom, one of China’s three major phone carriers, said in February that it had expressed interest in a technical role in privatizing Nitel.

Meanwhile, South Korea’s Daewoo Engineering & Construction Co. has received a $250-million order to build a gas-processing facility in Nigeria.

Daewoo E&C got the order from Shell Petroleum Development Co., a joint venture between Royal Dutch Shell PLC (RDSA, RDSB, RDSA.LN, RDSB.LN) and Nigerian National Petroleum Corp.

The report quoted a Daewoo E&C official as saying that the firm hopes to get more than $5.3 billion in overseas orders in 2011.