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INTELS/NPA: A deal gone sour

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INTELS/NPA: A deal gone sour

As the conflict between Nigerian Ports Authority (NPA) and INTELS Nigeria Limited lingers, some companies have been invited to bid for the pilotage service contract, thus heightening tension. BAYO AKOMOLAFE reports

In the last few weeks, the Federal Government through the Nigerian Ports Authority (NPA), has been at loggerheads with one of the foremost investors in the nation’s maritime sector, Intels Nigeria Limited. 

Although observers have taken positions depending on their understanding and affiliation to the parties, developments in the crisis suggest that all has not been too well with the pilotage contract procedure.

This is, however, not strange considering the fact that a lot of contracts entered into with the government in the past had some elements of impunity.

In spite of this defect, Intels, over the years, had never been found wanting as it had discharged its obligations to the Federal Government and placed Nigeria’s maritime sector on the world map.

Founded in 1984 at Onne, Intels provides integrated logistics services for the Nigerian oil and gas industry. 

It also offers agency services, cargo services, port management, specialised services, support services in shore bases, manages client operations, including pipe racks and stacking areas. The firm also warehouses, enclosed areas, jetties, offices, water tanks, fuel storages, generators, compressors, pilotage service and various other services.

Contract details

Acting on behalf of the Federal Government, NPA and Intels entered into a profit sharing agreement with 72 per cent of the revenue going to NPA, while 28 per cent stays with INTELS as commission.

According to details, the pilotage contract entitles the company to monitor the movement of vessels that sail in and out of Nigeria. As vessels move in and out of the channels, they are expected to pay certain dues and levies.

Intels’ involvement in the project became very urgent and important for the country as the Federal Government had lost a lot of money when NPA was solely in charge of the business.

It was gathered that when the service was handed over to the company in 2010, NPA’s revenue grew to $200 million annually from $6.7 million.

Crisis

However, trouble began in May 2016 and escalated two weeks ago, when NPA single highhandedly decided to adjust the terms of the contract with a directive that every revenue accruing to the company should go into the Treasury Single Account (TSA).

The conflict was further heightened when NPA invited some other companies to bid for the contract even when the original occupier (Intel), was still fully on the ground.

However, the firm said that such decision was a violation of the terms of the contract.

Besides, it noted that it had already used the pilotage contract to secure $1.4 billion loan facility from banks with the intention that the loan would be serviced by retaining its percentage of revenue collected.

Consequently, Intels said that it would only pay NPA’s dues into TSA after collecting the pilotage services subsequent to deductions of over N252 billion ($700 million) owed by NPA.

Bone of contention

According to Intels’ General Manager, Legal, Corporate, Contracts and Compliance, Mr Mike Epelle, the company’s reluctance to comply with the TSA arrangement was because its bankers had threatened to take back their N504 billion ($1.4 billion) loans if the company made any payment to the TSA on the ground that the decision was not part of the agreement in the pilotage contract.

He said: “We could pay into the TSA but not in the manner NPA wanted; we want to keep our commission and pay what is due to NPA.”

Despite the explanation and complaints by the company, the pilotage agreement was suddenly terminated at the instance of the Attorney General of the Federation, Justice Abubakar Malami, without recourse to negotiations, arbitration or adjudication between the two parties as enshrined in the binding agreement.

Malami had written to the Managing Director of NPA, Hadiza Bala-Usman, directing her to terminate the boat pilotage monitoring and supervision agreement, which allowed the company to receive revenue on behalf of government and retain a certain percentage of the revenue collected.

Following the directive, Usman insisted that all funds collected on its pilotage agency agreement must be remitted into the account, but Intels had argued that such directive was in violation of the terms of its contract.

The company, therefore, threatened that it would pull out its $2.6 billion investment in the Badagry deep seaport project.

Reactions

A Legal Practitioner, Mr. Sunday Fiola, who spoke with New Telegraph, said that the Attorney-General of the Federation, Justice Abubakar Malami, had the power to terminate the contract since NPA belongs to government. 

Epelle, however, said that only the court could give a verdict to terminate any contract, as AGF has no such power but could only advise on which direction to follow.

The Nigerian Importers Integrity Association (NIIA) and several other stakeholders and interest groups said that the cancellation of the contract would have a negative impact on foreign direct investment and the economy.

Also, an Economist, Dr. Austin Nweze and one of the leading financial analysts, Dr. Ken Igboanugo, said that the lingering face-off was a bad signal for Foreign Direct Investment (FDI) at a time the National Bureau of Statistics (NBS) reported that investment drive into the country had dropped by 41 per cent in the first quarter of 2017.

Also, Igboanugo said that NPA should take all necessary steps to resolve the dispute amicably in order to encourage investments in the country.

Similarly, the spokesman of the Intels, Mr. Bolaji Akinola, said that Intels was not the only private organisation that collects revenue on behalf of government and remits same into government’s coffers.

He said: “This is replicated in many other sectors of the economy. For instance, many companies deduct withholding tax from contractors and remit the same to government. I would like to believe that is a form of agency arrangement that allows the private entities to collect revenue on behalf of government.

Intervention

Nevertheless, the Chairman of Intels, Mr. Gabriele Volpi, has called for calm, saying he would do everything possible to ensure amicable resolution of the crisis.

Volpi said: “We intend to comply with the directive of government and transfer all the revenue to the TSA because we are a law-abiding company.”

Giving his backing to the chairman’s position, the President, NIIA, Godwin Onyekachi,  commended  Volpi’s intervention as a mark of good leadership.

He said: “It will save a lot of jobs and restore investor confidence in Nigeria. Disputes are bound to arise in commercial transactions of this nature and it is the responsibility of concerned parties to shift grounds so as to arrive at an amicable resolution.”

Last line

As much as investors are expected to play by the rules and conduct their businesses fairly, government must also exercise restraint in dealing with perceived misdeed, especially if the organisation has contributed largely to boosting investor confidence and economic growth. 

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  1. Alphonse Peto

    November 7, 2018 at 5:23 am

    I adore the catsuit tucked into your GLORIOUS velvet boots!!!! It makes them look like 70s harem pants – what a fabulous score! Dear Jacob, an infant at 36? I want to know if he’s ever had a girlfriend! Good luck fighting off the grannies – we’ll be them one day won’t we?;)))))) xoxooxoxoxxoo

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Shipping lines at crossroads over private armed guards

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Shipping lines at crossroads over private armed guards

The use of contract armed security guards by shipping lines to deter piracy has been proscribed by the Federal Government despite increased robbery and weak policing of Nigerian waters. BAYO AKOMOLAFE reports

 

As the world’s navies could not control vast area in the high seas to secure all ships sailing to various ports, the International Maritime Organisation (IMO)’s Maritime Safety Committee (MSC) in 2011 approved an interim guidance to shipowners, ship operators and shipmasters to use privately contracted armed security personnel on board ships transiting the high risk piracy areas in the Gulf of Guinea and other zones in the Gulf of Aden.

 

Security cost

The development made ship owners to pay as much as $60,000 to armed security guards to secure and protect vessels and crew.

For instance in Nigeria, shipping lines claimed that they spent over $200 million annually to protect cargoes and their crew by placing armed guards on board merchant vessels because of the menace of armed robbery in the Niger- Delta area.

However, the Federal Government said last week that such practice would no longer be business as usual for liners sailing on Nigerian waters.

Nigerian coasts have already been labeled as the hotbed of piracy and sea robbery.

The Government said that it was illegal and against Nigerian constitution for private armed guards to operate onboard vessels.

Attorney General of the Federation (AGF), Abubakar Malami, in Lagos, said that there were reasons to be worried about armed guards.

He noted that the private armed guards would not perform their anti-piracy duties in a way that does not escalate violence, involve unlawful use of force or cause international incidents.

 

Although Malami acknowledged that Nigeria’s waters was an alluring area for criminal activities such as piracy, armed robbery at sea, maritime terrorism, and a host of other vices, on the other hand, he explained that under the Nigerian law, armed guards were not permitted on merchant vessels within her waters.

 

The AGF, who was represented by the Special Assistant to President Muhammadu Buhari on Financial Crimes, Biodun Aikomu, at the  recent Lagos International Maritime Week, said that security on Nigerian waters remained the prerogative of the Nigerian Navy and the Nigerian Maritime Administration and Safety Agency (NIMASA).

 

He said that the National Assembly had enacted laws to address specific issues relating to maritime security and operations including the NIMASA Act, Cabotage Act among other international conventions, which Nigerian is a signatory to.

 

He noted: “The question as to the legality or otherwise of armed guards on merchant vessels in Nigeria is quite straight forward, under Nigerian law, armed guards are not permitted on merchant vessels within the Nigerian waters.”

 

In considering the legality or the use of armed guards on Nigerian flagged vessels, he said that important consideration had been given to the legal regime of the Flag State (Nigeria) vis-a vis the legal regimes of other states in a given situation.

 

Malami explained that there should be no express authorisation of vessel owners to have private armed guards on board.

 

He said that in Nigeria, individuals were not permitted to own or use fire arms except licence is sought and obtained in respect of such firearms.

 

The AGF said that giving such permit was expressly prohibited under Section 17 of the Private Companies Guard Act.

 

 

Anxiety

 

Despite his explanation, the Nigerian Ports Authority (NPA) said that the attacks on vessels berthing at the Lagos Port Complex were worrisome.

 

The Managing Director of the authority, Hadiza Bala Usman, said at a stakeholders’ meeting in Apapa, Lagos that the management was considering a number of strategies to check the attacks.

 

The managing director noted such strategies when reinforced, would bring to book those behind the attacks on vessels berthing at the Lagos Port Complex.

 

Usman noted that more patrol boats would be acquired to patrol waterfronts.

 

 

Remedy

 

The Director General of NIMASA, Dr. Dakuku Peterside, explained that the Nigerian maritime domain requires the commitment of all stakeholders to ensure optimum safety of investments in the sector.

 

He stated that there were a lot of factors that had contributed to the cost of products coming into the country through the seas, which makes it very important to tackle insecurity in the waterways.

 

He said: “The only way we can tackle maritime crime is for all of us to work together. There have been several regional initiatives in that respect to tackle maritime crime.

 

“Apart from the ECOWAS Integrated Maritime Strategy, you have the Africa Integrated Maritime Strategy, you have the Gulf of Guinea Commission dealing with the same thing there are several sub-regional and regional initiatives to tackle maritime insecurity so I see a lot of potential in regional collaboration and integration.”

 

Last line

 

Government should invest in maritime security, domesticate international conventions it ratified and enforce them in order to boost shipping in the country.

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Bonded terminal operators lose 90% workforce

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About 20 bonded terminals in Lagos have sacked 90 per cent of their staff due to lack of job, Bonded Terminal Operators of Nigeria (BTON) has said.

 

It was learnt that each terminal employs up to 500 staff aside the 10,000 auxiliary workers.

 

Executive Secretary of BTON, Mr Haruna Omolajomo, said in Lagos that bonded terminals were operating below three per cent.

 

He noted that facilities worth about N3trillion in the terminals were wasting.

 

Omolajomo noted that bonded terminals in Lagos were not allowed to function very well due to lack of cargoes from the main port.

 

The executive secretary urged the National Assembly to enact a law to recognise bonded terminal as an extension of ports in Nigeria in order to remain in business.

 

Omolajomo explained that the legislation was necessary to reduce unemployment and to save their N3trillion investments.

 

Omolajomo explained that lack of cargoes had demoralised some of the bonded terminal operators in the country, saying some of them were indebted to banks.

 

 

 

He said salaries of workers had not been paid for a year in some terminals.

According to him, “some terminals have sacked about 95per cent of their staff. Where they are supposed to have about 500 staff, they have only seven and the seven are just overseeing the property on ground so that people will not steal them.”

 

Omolajomo said that certain percentage of cargoes should automatically be assigned to bonded terminals as the extension of ports.

 

He said: “We have about 20 bonded terminals and each of them have sacked 90 per cent of their staff. Today, no bonded terminal operates more than three per cent, they operate below three per cent.”

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National fleet: Ship owners fret over slow pace

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National fleet: Ship owners fret over slow pace

Following the demise of the Nigerian National Shipping Line (NNSL) in 1995, a new national fleet being conceived to boost shipping in the country is still crawling as the Federal Government failed to amend the Maritime Act. BAYO AKOMOLAFE reports

 

Shipowners are at crossroads over the establishment of a national fleet to boost domestic and international shipping in the country largely dominated by foreign liners.

The plan to float a national fleet was mooted in 2016, when the Federal Ministry of Transportation set up a National Fleet Implementation Committee, headed by the Executive Secretary of the Nigerian Shippers’ Council (NSC), Hassan Bello.

Past records

 

This idea came to fruition 23 years after the demise of the Nigerian National Shipping Line (NNSL).

The shipping line was established by the Federal Government in 1959. Despite heavy investment and subsidies, the company with its 24 vessels was unable to compete with European and Asian lines.

However, Malaysia, which started its shipping line almost the same time with Nigeria, survived with 245 ships of various sizes and types. As at 1995, all the 24 fleet under the defunct NNSL had disappeared.

Presently, the country has no national fleet to boost local and international trade despite the fact that 92 per cent of all import/export cargo in and out of the country is via seaborne trade.

Excuses

Director General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Dakuku Peterside, said the inability of local investors to raise funds for equity participation stalled the establishment of a national fleet and licensing of private national carriers.

 

He said that the recession had also made it difficult for Nigerian ship owners to raise funds to take up the 60 per cent equity under the new arrangement with a Singaporean liner, Pacific International Lines (PIL).

Nigeria and Singapore had reached an agreement to establish a private sector-driven national carrier with stake holding of 60 to 40 per cent respectively.

Peterside also blamed shipowners for not coming forward to apply for the national carrier status.

He said: “There is no 60 per cent of the equity that can be picked up anywhere and so that is why the process seems fairly long.”

Impediment

However, it was learnt that the only saving grace was the recent Memorandum of Understanding (MoU) signed in August 2016 between the Federal Government and PIL, but the Nigerian maritime laws obstructed the process as the government was reluctant to amend the loopholes in the Maritime Act, which could enhance the growth of the industry.

For instance, President of Shipowners Association of Nigeria (SOAN), Engr. Greg Ogbeifun, said at a shipowner forum in Lagos that Nigeria’s tax laws had put off PIL from the MoU because of its unfavorable terms and policies.

 

He recalled that the firm put it in writing that unless the tax laws were reviewed, it won’t be able to fly Nigerian flag as planned.

 

In the MoU, Ogbeifun said that PIL had initially wanted to provide the Joint Venture (JV) or Special Purpose Vehicle (SPV) that was more of expertise, where it would provide the managing director/ chief executive officer, chief operating officer and Nigeria would provide the chief executive officer.

 

Divergence

 

He said: “We said no, and that became the subject of further discussion and negotiation. At the end, it was agreed that PIL would bring the managing director /chief executive officer; while Nigeria will bring a deputy managing director; they will bring a chief operating officer and Nigeria will bring a deputy chief operating officer and chief finance officer, while they will bring a deputy chief finance officer. You may be aware that the PIL is a large international shipping company with a lot of experience internationally and in Nigeria for long.

 

Ogbeifun said that Nigeria saw benefits in leveraging on the company ’s worldwide experience, noting that the company had over a hundred ships in its fleet worldwide.

 

Dilemma

 

But the president noted that Nigeria lacked political will to implement the comprehensive report and recommendations made by a committee set by the Minister of Transportation, Rotimi Amaechi to study and make recommendation for the revamping and restructuring of the country’s flag administration in order to make it more attractive for international patronage.

 

For instance, Ogbeifun said that the government had failed to review the country’s tax laws and policies as it has been done in other maritime countries.

 

He explained that Nigeria had not been able to midwife the emergence of a Nigerian fleet, whether private fleet or fleet resulting from public private partnership.

 

Ogbeifun lamented that Nigerian flagged tankers were already disadvantaged.

 

The president explained that Nigeria’s flag administration was extremely weak to the extent that the Nigerian Liquefied Natural Gas (NLNG), which owns a large fleet trading worldwide, could not register its ships in the Nigerian flag in other to boost Nigerian tonnage.

 

Last line

 

Government should amend the laws impeding maritime business as done in other countries in order to boost shipping and earn more revenue.

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French carrier to manage 2.5m TEU Lekki Port

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French carrier to manage 2.5m TEU Lekki Port

French container carrier, CMA CGM is to handle the proposed 2.5 million Twenty Equivalent Unit (TEU) and 10,000 TEU container ships at Lekki port.

 

Already, Lekki Port LFTZ Enterprise has signed a memorandum of understanding with the shipping company.

 

This is coming barely a year after the Philippine port developer, International Container Terminal Services (ICTSI), the first investor at the container terminal, halted an agreement to develop and operate the container terminal in May 2017
ICTSI backed out of its N85.5 billion ($225 million) investments from the $1.5 billion public private partnership (PPP) between the Nigerian Ports Authority, Lagos State Government and Tolaram Group.

 

However, under the new agreement, the French carrier’s subsidiary, CMA Terminals, would be responsible for marketing, operations and maintenance of the container terminal at the seaport.

 

It was learnt that the terminal would have two container berths once completed in 2020.

According to the Executive Officer of the CMA CGM Group, Farid T. Salem, larger container ships from Europe and Asia would berth at the port to better serve customers in the entire region.

With its 16-metre depth, it will allow the group deploy ships with a capacity of up to 14,000 TEUs.

 

The company said that the latest move was fully in line with CMA CGM Group’s development in the region.

The container terminal will allow the group to develop its presence into West Africa’s first consumer market and will serve as a transshipment hub, especially to neighbouring countries like Togo and Benin.

It was learnt that the container terminal would be equipped with a 1,200-meter-long quay as well as 13 quay cranes upon completion and would also have a capacity of 2.5 million TEUs.

When operational, the port is expected to contribute more than $500 billion to government’s treasury, while also creating close to 163,000 new jobs in the economy.

Already, Lekki Port has secured an approval of N57 billion ($150 million) funding from the Board of African Development Bank (ADfB) for its deep seaport project.

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Smuggling: Niger as transit route for Nigeria

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Smuggling: Niger as transit route for Nigeria

With the ban on importation of vehicles through land borders by the Federal Government taking a toll on smugglers, Republic of Niger has become a new route for the illegal business, BAYO AKOMOLAFE reports.

 

The ban on importation of vehicles through land border and Federal Government’s automotive policy, which attracts 70 per cent duties, have fueled the number of smuggled vehicles through porous routes in the northern part of the country.

 

Investigation by New Telegraph revealed that smugglers are routing vehicles imported from Cotonou Port in Republic of Benin into Nigeria through Republic of Niger daily.

It was revealed that car dealers were using the illegal routes after paying all legal dues in Cotonou Port before driving to Niger Republic to settle that country’s taxes and levies then move them to Nigeria.

 

Also, it was gathered that the dealers move their vehicles in convoy, tactically through Maradi and Maimujiya towns in Niger Republic to Nigeria before routing them to their final destinations.

 

Seizures

 

It would be recalled that in November 2017, Nigeria Customs Service (NCS), Sokoto Command, comprising Kebbi, Sokoto and Zamfara states, seized 39 vehicles illegally routed through the two neighbouring countries.

 

Just two weeks ago, NCS operatives impounded no fewer than 150 Sport Utility Vehicles (SUVs) hidden in a premises in Sokoto State.

 

Also, the service raided a warehouse in Sokoto and impounded 48 vehicles last week.

 

The vehicles were unlawfully imported into the country through Niger Republic from Cotonou Port.

 

 

 

The vehicles, made up of old model Lexus (2007 model) and Toyota Avensis (2005 model), were seized from a member of Sokoto branch of Car Dealers Association of Nigeria (CDAN), Mukhtar Muhammed, a.k.a Mafia.

 

According to Customs’ records in Sokoto and Abuja, the vehicles were imported into the country in batches between December 2017 and March 2018, without paying the necessary charges to Customs.

 

Area Comptroller of Sokoto Command, Alhaji Nasir Ahmed, said that the service was calculating the duties the smuggler would pay to government with necessary penalties.

 

Already, the leadership of the car dealers association has been making frantic efforts to raise the fines.

 

 

Southern routes

A vehicle dealer, who spoke to our reporter on condition of anonymity at Idiroko border, said that the trade was no longer lucrative at all the border communities from Ogun to Kwara states because of the obstacles put in place by the NCS to frustrate them.

He noted that vehicle importation from Cotonou Port through Idiroko and other approved routes has reduced when compared to the past.

 

The dealer noted: “When you bring your vehicles to the country in the night, you just discover that Customs officials enter your premises and tow the vehicle away. Informants are everywhere and you can’t know them. This is the only trade we know how to do here and this is why some people have decided to route all their imports through Niger before coming to Nigeria.

 

“It is now difficult to register any vehicle imported through the land border in Ogun and Lagos states licensing offices. You can’t even pay duty on any car brought through the border. Customs has dropped two or three lines in some licensing offices where they will confirm whether the vehicle passed through the port or border. Once it is not from the port, they will go after you and impound it.”

 

 

Diversion

 

The dealer also confirmed that people smuggle vehicles into the country daily through Niger Republic to bring vehicles to the country.

 

According to him, “once your vehicles arrive, you register them in one of the northern states before moving it down. This is the only option some people are exploiting and in some cases some of the vehicles have been intercepted because of poor documentation.”

 

Also, a clearing agent, identified simply as Evangelist, explained that vehicle importers had been facing had times in Ogun State borders since commencement of the ban in 2017.

 

This is the reason people prefer to use the northern part of the country as alternative route for smuggling.

 

He noted that the only moving trade they are identified with is vehicle importation, adding that it would be difficult to leave the business.

 

Evangelist confirmed that Customs had blocked all the avenues they were using in the past to perfect their imports.

 

Because of the challenges, he explained that some vehicle importers and clearing agents had started relocating from the Ogun border communities to other states.

 

The customs agent stressed that N1,000 now being exchanges for 617 Cfa (Communaute Financere Africaine), thereby making business difficult at the border.

 

“Presently, Benin businessmen and their government are feeling the pain too,” he said.

 

According to him, the Federal Road Safety Corps lackes the capacity to identify whether a car was shipped through the seaport or land borders.

 

 

He added: “The rate of trans-border crime around the communities is on the increase because people are no longer doing anything. The only trade we know is car dealing business and the business is not there again. Some of my colleagues cannot cope with clearing jobs at the seaport because they have not been doing it. This is the major problem.”

 

Reacting, spokesman of Customs’ anti- smuggling unit, Mr. Jerry Attah, explained that Customs no longer collecting duties on vehicle imported from land border.

He noted that any vehicle imported through the land border would be seized by the service.

 

Last line

 

Government should review the auto policy, which is currently creating jobs and revenue for other countries

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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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NPA, UNILAG to collaborate on capacity building

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NPA, UNILAG to collaborate on capacity building

Nigerian Ports Authority (NPA) and University of Lagos have resolved to collaborate on capacity building for its workforce.

 

To this end, the authority in a statement, said that adequate provision would be made in the 2018 budget to meet some of the urgent requirements and needs of the university under its Corporate Social Responsibility (CSR) initiative.

 

The Managing Director of the authority, Hadiza Bala Usman, gave the assurance when a delegation from the university led by its Vice-Chancellor, Professor Oluwatoyin Ogundipe, paid her a courtesy call at the authority’s head office in Lagos.

 

She directed the university authorities to forward all the necessary details of their projects for analysis and consideration.

 

The authority’s Assistant General Manager, Corporate & Strategic Communications, Isah Suwaid, in a statement, said that Usman had expressed willingness to assist within budgetary limitation of the authority.

 

Ogundipe had earlier appealed to the management of NPA to intervene in the rehabilitation and reconstruction of some dilapidated structures at the college of medicine.

 

He told the managing director that NPA should take advantage of the maritime programmes presently available in the university.

 

The vice-chancellor suggested that NPA could consider sponsoring a professional chair in the university.

 

He recommended that the authority could consider sponsoring customised course to be specially designed for its staff as done to other maritime agencies in the country, under the institute for maritime studies.

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Maritime Academy Threatened by unskilled manpower

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Maritime Academy Threatened by unskilled manpower

Thirty-nine-years-old Maritime Academy of Nigeria (MAN) is facing inadequate manpower and infrastructure to compete with its counterparts in The Philippines, India, Egypt, England and thevUnited States. BAYO AKOMOLAFE reports

 

For close to four decades, the decision by some cadets at the Maritime Academy of Nigeria (MAN) to proceed to the second phase of their mandatory training on board ships after due academic certification has been a tall order.

 

The academy was established in 1979 to train shipboard officers, nautical engineers, marine engineers, ratings and shorebased management personnel to serve the maritime community locally and internationally. Also in 1988, the academy’s mandate was expanded to train all categories of workers in the country’s maritime industry.

 

By the end of 2008, the institution had trained about 4,300 merchant navy officers and more than 65,000 other workers in marine engineering, nautical science, maritime transport and business studies, ship building, port operations, marine insurance, maritime law, maritime security, and other specialised maritime courses.

 

However, challenges ranging from poor staffing, acute shortage of skilled manpower, underfunding conflicts, poor management, inadequate infrastructure, training equipment, training vessel, Radar Arpa Simulators (RAS) and access to sea time have put the academy on a wrong track among its global competitors.

 

The Rector of the academy, Commodore Emma Effedua, said recently in Oron that International Maritime Organisation (IMO) was gradually losing hope in Nigeria producing quality seafarers.

 

Issues

 

It was learnt that the institution still depends on some phased out equipment acquired 25 years ago at its foundry shops to train students. Moreover, while it is one lecturer to 200 students, it was revealed that eight cadets were being assigned to one machine instead of three. Furthermore, the academy has no capacity to award a Class 1 Certificate of Competency (CoC) to its graduates because of inadequate facilities.

 

Staffing

 

Worried by the number of management staff on acting positions, the academy’s Board Chairman, Mr. Ademola Seriki, also complained last month during his inaugural inspection of the school that there were too many officers, who were handicapped in discharging their duties effectively.

 

The chairman vowed to put an end to such practice in the school. Also, during an oversight function in March, 2018, the Chairman, House Committee on Maritime Safety, Education and Administration, Mr Mohammed Umar-Bago, advised the management to sack 83 staff of the school, who were engaged without due process.

 

The chairman said that the academy was a special school that needs professionals to train cadets, not just employing people that were not relevant to the mandate of the academy. He said: “Sack them if their employment did not go through due process; that is how touts are employed.” Umar-Bago explained that the academy was over bloated with 700 staff.

 

Project

 

Also, Seriki who expressed disappointment with the level of abandoned projects and obsolete infrastructure in the academy, stressed the need to replace the school’s outdated equipment with modern ones. He said: “I am disappointed over abandoned projects and the vast areas that have not been developed. We have a lot to do. Look at this 30 acres expanse of land, nothing has been done here. “So we have a lot of work to do. We are so excited about it, but still we are challenged. The issue of infrastructure is to be faced. “We cannot take away nautical engineering and marine engineering from maritime studies.

 

Funding

 

The President of Shipowners Association of Nigeria (SOAN), Greg Ogbeifun, had before now traced one of the problems of the academy to poor funding.

 

He lamented that the demise of the Nigeria National Shipping Line (NNSL) had contributed to the problem of the school.

 

According to him, the disappearance of fleet of vessels that provided sea- time training opportunities for cadets had led to a huge gap in the maritime human capacity development in Nigeria.

 

 

The president added that there was no articulated programme to ensure effective link between the institution and the existing fleet of vessels in the country’s maritime domain. He recalled that the cadets from the academy were automatically exposed to a 12-month mandatory sea-time onboard the various vessels operated by the NNSL and this gave birth to well seasoned professionals, who have been manning sensitive positions in the maritime industry.

 

Ogbeifun faulted Federal Government’s training of seafarers abroad, adding that training of seafarers and cadets was the responsibility of ship owners and shipping companies.

 

 

Way forward

 

Seriki proposed that the school should embark on free training of stakeholders who will in turn provide the needed equipment to the institution.

 

The chairman also called for expansion of the school’s laboratory to make the facility more conducive for the cadets as well as equipping of the e-library and the ICT resource centre. He stressed the need to arrest the deteriorating state in line with its mandate and core values. Seriki said that the academy should partner with all relevant stakeholders to enable it meet international standard. Also, Effedua stated that restructuring and repositioning the school was the only solution to move the school forward.

For instance, the rector proposed that some of the buildings in the school should be converted to hostels to accommodate students and those on short courses, noting that proceeds from the hostel could be used to execute other critical projects. The rector disclosed that management was already at the point of getting permission to effect the conversion.

 

Effedua said: “We need to put the necessary infrastructure in place; we must really work in synergy with our sister agencies like the Nigeria Ports Authority, Nigerian Maritime Administration and Safety Agency (NIMASA), Nigeria Liquefied Natural Gas (NLNG), shipowners associations and others to facilitate the provision of facilities, technical services, capacity-building and engagement of qualified cadets from the academy. Seriki said that the academy must build a relationship that would result in acquiring assets, which will be of benefits to everyone.

 

Last line

 

Nigeria should focus on capacity building in the maritime industry rather than relying on foreign manpower.

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Terminal commits N126bn on facilities

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APM Terminals has invested over $350 million (N126 billion) on the development and modernisation of its terminal at the Lagos Port Complex Apapa. The investment, according to the company’s Head of Government, Stakeholder Relations and Communications of APM Terminals Apapa, Austin Fischer, covers the development of container handling, stacking yards, container inspection facilities, sophisticated and ultramodern cargo handling equipment and information technology.

 

Also included ar the automation, human resources, a world class training centre, simulator and rail sidings. Fischer said that the company had commenced work on the provision of modern cold chain transportation alternatives for farmers in the agricultural centers of northern Nigeria to bring fresh produce intact and unspoiled to market centers in Lagos. He disclosed this at a capacity building workshop held in Lagos for public relations managers and journalists covering the Nigerian maritime sector.

 

Fischer noted that an estimated 15 million metric tons of Nigerian-grown perishable goods, including onions, potatoes, tomatoes, peppers, okra, ginger and carrots, were lost annually due to poor logistics infrastructure and high transportation costs through spoilage and product damage.

 

Fischer said: “Ongoing investments by APM Terminals in cold chain transportation are demonstrating ways to reduce post-harvest losses, and extend the shelf life of fresh produce to local consumption and export.

 

Also, CEO of Ships & Ports, Bolaji Akinola, whose company organised the workshop, said that the maritime sector was crucial to the attainment of Nigeria’s economic aspirations.

 

He said with the country having vast coastline measuring about 850 kilometres, an Exclusive Economic Zone (EEZ) of well over 300,000 square kilometers, 3,000 kilometres of navigable inland waterways, six major seaports, 11 oil terminals, over 170 private jetties, rewarding career and business opportunities beckon on discerning minds.

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Customs agents fret over 7% port surcharge abuse

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Customs agents fret over 7% port surcharge abuse

The 7 per cent port development surcharge statutorily introduced is not working for the National Council of Managing Directors of Licensed Customs Agents (NCMDLCA). The National President of NCMDLCA, Lucky Amiwero, said this while presenting a paper at a forum in Lagos.

 

He said that the surcharge was established exclusively to maintain and improve infrastructure at the seaports. Amiwero noted that the fund was drawn from an additional 7 per cent of the duty on imported goods.

 

He urged the government to build truck holding bays and truck terminals from the fund in order to rid the port access roads of trucks and trailers, which had become a menace to the ports in Lagos and neighbouring communities.

 

He noted that the Federal Government had lost sight of the actual reason for the 7 per cent surcharge, saying that proceeds from the surcharge ought to be set aside and used to meet the infrastructural needs of ports nationwide.

 

Also, he said that the government should redefine the roles of the Nigeria Ports Authority (NPA) in addressing the port, logistics infrastructure and the access routes to the ports.

 

Amiwero identified traffic gridlock on port access roads, breakdown of scanners, cumbersome customs clearing process and port service charges not tied to specific services as some of the problems militating against the growth of the shipping sector in Nigeria.

The president said that country needs to define the port model in properly structured legal instruments; enact legislation to control and regulate the shipping/ocean business based on global best practices.

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