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Tough times ahead for local shipping lines

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Tough times ahead for local shipping lines

Unless the Nigerian Maritime Administration and Safety Agency (NIMASA) uses its discretionary power to intervene, indigenous shipping sector may collapse soon as over 80 per cent of their single hall vessels may be debarred from Nigerian waters by 2020, BAYO AKOMOLAFE reports

 

Indigenous ship owners may face another hurdle in the next two years on Nigerian waters as the five years grace given for them to shift from single-hull ships to double hull expire.

 

Also, they would not be permitted to engage in international trade from January 2021 as their certificate extension only covers trade within Nigerian waters till December 31, 2020. The International Maritime Organisation (IMO) had set 2015 as the initial deadline but it was extended in Nigeria.

 

Already, all foreign registered single hull tankers have been banned from trading on Nigerian waters as mandated by IMO regulations.

 

Reasons for ban

 

The international apex maritime organisation, IMO, had earlier said that tanker ships with single hull often faced problems of leakage of ballast water into cargo because of its design.

 

It noted that single hall vessels had increased the risks of pollution during ballasting and de-ballasting as leaking pipes passing through cargo tanks often contaminate the clean ballast water.

 

Therefore, the maritime organisation explained that double hull would remove this problem with different piping systems. It noted that double hull ships were more susceptible to minor structural failures as compared to the single hull tankers.

 

According the organisation, all single-hull tankers, including the smallest ones which were initially not covered by the scheme, would be subject to the Condition Assessment Scheme (CAS) from the age of 15 years.

 

The CAS is an enhanced additional inspection scheme specially developed to detect structural weaknesses in single hull tankers.

 

IMO Convention

 

It would be recalled that in April 2001, IMO adopted regulations under the International Convention for the Prevention of Pollution from Ships (MARPOL), requiring new tankers of 5,000 dead weight(dwt) and above, to have double hull, mid-deck or equivalent design.

 

It further said that port states were permitted to deny entry to their ports and offshore terminals to single hull tankers operating under such life extensions after 2010, and to double sided or double bottomed tankers after 2015.

 

Affected ships

 

Based on this position, amendments to the MARPOL regulations accelerated the phasing out of single hull tankers to 2005 for Category I vessels and 2010 for Category II vessels. Category I vessels include crude oil tankers of 20,000 deadweight (dwt) and above and product carriers of 30,000 dwt and above that are pre-MARPOL Segregated Ballast Tanks (SBT) carriers. Category II vessels include crude oil vessels of 20,000 dwt and above and product carriers of 30,000 dwt and above that are post-MARPOL SBT vessels.

 

In addition, a Condition Assessment Scheme (“CAS”) will apply to all single hull tankers 15 years or older.

 

However, IMO noted that Flag States may permit the continued operation of Category II tankers beyond 2010, subject to satisfactory CAS results, but only to 2015 or 25 years of age, whichever comes earlier. Category II tankers fitted with double bottoms or double sides not used for the carriage of oil will be permitted to trade beyond 2010 to 25 years of age, subject to the approval of the flag state.

 

NIMASA’s position

 

However, the Nigerian Maritime Administration and Safety Agency (NIMASA) extended the deadline to December, 31, 2020.

 

The agency extended the deadline to sustain the development of the Nigerian maritime industry and enhance the gains of the Cabotage laws and Local Content Act.

 

 

Already, NIMASA, acting in compliance with the IMO regulation, has stopped registration of single hall vessels and affirmed that no single hall vessel would be permitted to sail on Nigeria waters.

 

It explained that the decision to extend the deadline was taken in line with the provisions of IMO, which allows member states who do not have the capacity to replace their existing single hull tanker fleet to extend the phase-out date of certain categories of tankers in their countries, provided the vessels do not engage in international trade.

 

According the Head of NIMASA Public Relations, Isichei Osamgbi, “our decision to extend the final phase-out date for all single hull tankers registered under the Nigerian flag administration to December 31, 2020 was to give more time for fleet replacement by Nigerian ship owners and also develop greater capacity to handle scrapping of vessels in the country.”

 

 

He explained that all tankers that would benefit from the extension must possess valid classification and statutory certificates, including a valid Condition Assessment Scheme (CAS) certificate issued by NIMASA.

 

Pending issues

 

Despite these, it was learnt that to convert a single hall ship to a double hall would attract high cost among other challenges as the ban has led to increased demand for new ships and made ship values to attract higher rates. Presently, more than 80 per cent of ship owners in the country have gone out business because of lack of jobs and debts. In addition, it was revealed that while some of them could no longer pay wages of their crew, other have auctioned their vessels to pay bank’s debts.

 

According to NIMASA, more than 80 per cent of all Nigerian tankers are currently single hull.

 

Besides, some of the vessels were above 35 years old.

 

Already, NIMASA had stopped renewal certificates since 2015 for vessels that are more than 35 years.

 

Also, contrary to the existing five-year tenure for renewal of certificates, registration of new single hull tankers had ceased since 2017.

 

President of Shipowners Association of Nigeria (SOAN), Engr. Greg Ogbeifun, expressed displeasure over the challenges facing indigenous ship owners and the turn of event in the industry in the last two years. He noted that indigenous tonnage had gone down, while seafarers were going out of job

 

According to him, most ship owners were unable to meet their obligations to the financing banks, leading to loss of jobs and failed businesses.

 

The president said that what was needed to grow the Nigerian shipping industry and the economy was government support on Cost Insurance and Freight (CIF), which would enable them to lift Nigeria crude and ultimately boost indigenous capacity.

 

Ogbeifun noted that foreign vessels banned in Europe, which are not supposed to operate on the nation’s waters, were in fact leading and dictating in the distribution of imported petroleum products in the country’s waters.

 

Last line

 

Despite the challenges, there is need by the government and ship owners to comply with the international shipping standard.

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