October 2, 2022

Maritime Today Online

latest news and events in maritime and shipping

Shipowners petition National Assembly as NNPC contracts bunkering service to foreigners

The Shipowners Association of Nigeria (SOAN) has petitioned the National Assembly over the continued patronage of foreign shipping companies for coastal shipping services by the Nigerian National Petroleum Corporation (NNPC), in violation of the local content and cabotage laws in the country.

This came as the NNPC recently contracted coastal and bunkering vessels services to a foreign shipping company, Messrs UNIBROS, operating with 11 foreign flagged coastal tanker vessels.

The petition signed by the SOAN President, MkGeorge Onyung, a copy of which was obtained by MaritimeToday Online, urged the National Assembly to investigate the NNPC over the breach of the Cabotage law in the award of contracts to foreign vessel owners to the exclusion of Nigerian shipowners.

The group also called for the cancellation of the UNIBROS contract, which it noted was not subject to public tender in line with the public procurement procedures.

According to the petition titled ‘Urgent Need to Investigate the Breach of Nigerian Content and Cabotage Laws and Abuse of Customs Regulations to gain Unfair Advantage in the Award of Contracts to Foreign Vessel Owners for Coastal Shipping of Petroleum Products in the Downstream Sector of Nigerian Maritime Industry,” SOAN said despite the willingness by indigenous operators to accept freight payments in naira, the NNPC is presently paying UNIBROS in United States dollars, thereby further draining the nation’s extremely scarce foreign exchange resources.

The petition reads in part, “The Ship Owners Association of Nigeria (SOAN) hereby register our protest in this show of bad faith and unpatriotic attitude displayed by NNPC, despite the fact that Nigerian Shipowner‘s and operators have demonstrated capacity to operate this contract exclusively, and have expressed willingness to accept freight payments in Naira whereas NNPC is presently paying UNIBROS in US Dollars, further draining our extremely scarce foreign exchange resources.

“Take note that this contract award will result in amplification of capital flight, valued in excess of $100million annually to the detriment of our economy in addition to the fact that no Customs import duty has been paid for any of the 11 vessels in question, again in breach of our Nation’s fiscal and monetary policies.

“Nigerian owned and flagged vessels are made to pay full Customs duty and appropriate taxes on earnings which foreign shipping companies have continually evaded illegally. UNIBROS and/or any other foreign shell company do not pay any Tax To FIRS.”

The group noted that in the area of capacity building, no seafarer training or local content strategic plan is in place in line with the Nigerian Oil and Gas Industry Content Development (NOGCID) laws among foreign vessels patronized by NNPC for coastal shipping services.

“Neither UNIBROS nor any foreign shipowner or shipping company is made to comply with one of the major prequalification requirement for consideration in the Coastal and Bunkering Vessels Service Tender process, being the submission and approval by NCDMB.

“We therefore implore you to use your good office to reverse and cancel this contract which was not subject to public tender in line with our public procurement procedures,” SOAN stated

The association assured that its members are standing by with Medium Range (MR), Long Range (LR), and Handy-size Tanker Vessels to meet NNPC’s coastal and import shipping requirements within short notice, subject to bankable contract terms and payment conditions.