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NIMASA, Fraud Fingered In Locals Not Lifting Crude

Posted: Apr 22, 2016 at 3:01 pm   /   by   /   comments (0)


Oladunjoye Phillip Lagos


These indeed are hard times for indigenous ship owners in the country as they are being exempted from lifting crude oil, a development, which, according to operators in the maritime industry, is costing the country a whopping $700 million on monthly basis.

Independent gathered that foreign vessels are dominating crude lifting while local shippers are exempted for lack of capacity, non-implementation of the Cabotage Act by NIMASA, which would have helped the locals build their capacity and corruption in the system.

Apart from monetary loss, the country is losing employment opportunities as the local ships would have generated some form of employment if actively involved in the business of lifting crude.

Stakeholders in the industry are blaming the Federal Government for the non-implementation of the Cabotage Act, which is supposed to govern the activities of players in the industry.

Part II of the Cabotage Act, which is titled ‘Restriction of Vessel in Domestic Coastal Trade’ provides that “a vessel other than a vessel wholly owned and manned by a Nigerian citizen, built and registered in Nigeria shall not engage in the domestic coastal carriage of cargo and passengers within the coastal territorial inland waters, or any point within the waters of the exclusive economic zone of Nigeria.”

It also stated that “a tug or vessel not wholly owned by a person who is a Nigerian citizen shall not tow any vessel from or to any port or point in Nigerian waters, or tow any vessel carrying any substance whatsoever whether of value or not or any dredge material whether or not it has commercial value from a point within Nigerian waters.”

It, however, said that nothing in the section shall preclude a foreign vessel from rendering assistance to persons, vessel or aircraft in danger or distress in Nigerian waters, but added that a vessel tug or barge of whatever type other than a vessel, tug and barge whose beneficial ownership resides wholly in a Nigerian citizen shall not engage in the carriage of materials or supply services to and from oil rig, platforms and installations whether offshore or onshore or within any ports or points in Nigerian waters.

“A vessel of whatever type or size shall not engage in domestic trading in the inland waters of Nigeria except as a vessel that is wholly owned by Nigerian citizens. (1) In the case of rebuilding a vessel, such vessel shall be eligible for sabotage services if the entire building including the construction of any major components of the hull or superstructure of the vessel is effected in Nigeria. (2) Vessel built in a foreign yard but forfeited to any Nigerian governmental authority for breach of any laws of Nigeria or captured as war prizes are exempted from the Nigerian built requirement,” the act provided.

Experts in the maritime industry said that the provision of the Act presupposes that no foreign vessel should be allowed to lift crude oil in the country, but blamed the dominance of foreign ships in the country’s territorial waters on lack of implementation of the Cabotage Act.

President of the National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Mr. Lucky Amiwero, told Independent that foreign vessels are not supposed to be lifting crude in the country by now if things are working according to provisions.

He said there were three legislative Acts, NIMASA Act; Local Content Act and the Cabotage Act that were meant to boost indigenous participation in the industry.

He lamented that all the acts were not implemented, specifically noting that the NIMASA Act had made provision for ship expansion programme, which he said NIMASA has failed to implement.

He noted that NIMASA ought to create the enabling environment through the 25 percent NIMASA fund to build the capacity of indigenous ship owners for active participation in the industry.

“All these Acts have not been implemented and if not implemented foreign vessels will take advantage and be lifting our crude, depriving us of employment opportunity for our people. NIMASA’s function is to build indigenous capacity. They are supposed to work with the NNPC on national cargo and not giving out contract here and there. NIMASA has not been living up to its billings.”

He said the local ship owners do not have the capacity to lift crude because NIMASA has not created the enabling environment.

Speaking in the same vein, Mr. Francis Omotoso, a customs agent, said lifting of crude by indigenous ship owners has been a long due opportunity denied them, blaming the government for not encouraging more ship yards to be built in the country.

He explained that to engage in the lifting of crude requires modern vessels, which the indigenous ship owners could not afford for lack of fund.

He said the maritime fund, which is supposed to be given out to the indigenous ship owners to either upgrade their vessels or procure another, was not being disbursed by NIMASA.

“The disadvantage is that the country is losing a lot of money to foreign vessels. Virtually everything in the maritime industry is being given to foreigners. They are mortgaging the lives of Nigerians. It is a total dominance of our rights,” he said.

He also told Independent that corruption is also responsible for the non-inclusion of indigenous ship owners in the lifting of crude, noting that the cartel that operates in the maritime industry are secretive and would not allow anyone to know what they are doing.

“We don’t have the records of the number of oil that are loaded on daily basis. They don’t allow even the customs to get to the oil rigs. It is a serious cartel that operates in the sector. That is why they don’t allow local operators to know what is happening there,” he said.

He said for the efforts of President Muhammadu Buhari to really be seen and appreciated, he must overhaul the maritime industry.

He also advised that NIMASA should through the fund being allocated to it buy modern vessels and ask five indigenous companies to handle one each, instead of giving the money to them.

The president of the Nigeria Indigenous Ship owners Association (NISA), Mr. Aminu Umar, had lamented recently that the country was losing $700 million monthly to the dominance of crude oil shipment by foreign ship owners.

He urged the Federal Government to grant indigenous ship owners between 10 to 20 percent allocation in lifting crude oil, saying that the country was losing a huge amount of money due to the fact that the foreign ship owners had dominated the transportation of crude oil.

“Almost 70 to 77 crude oil vessels load oil monthly out of Nigeria. The foreign ship owners do not employ Nigerians and they do not pay tax. What we are telling the Federal Government is to give us the support so that we can take at least 10 percent of the crude oil vessels operating in Nigerian waters,” Umar said.

He was optimistic that if government could give indigenous ship owners 10 percent allocation to lift crude oil, they would create jobs for the teeming youths as well as retain the proceeds in the nation’s banks.

Umar said that indigenous ship owners would also pay tax, which would assist the government in tackling some of its responsibilities.

Also former National Hydrographer, Comdr. Joseph Abulu, said Nigerians are not able to lift crude oil and other petroleum products because government is not giving the opportunity to indigenous ship owners even when they have standard vessels capable of performing the function.

The former naval officer said that most of those involved in the lifting of the products presently do not have their own vessels but are only chartering vessels. He said it is not right for the Federal Government to be acquiring vessels for that purpose, stressing that there are Nigerians who own ships and have adequate knowledge required to lift products for export.