Indigenous ship owners in Nigeria have secured a $1.8billion (N270billion) facility from Nationwide Finance Miami, Florida to purchase 20 new crude carriers.
Accessing the funds, will however depend on the ability of the local ship operators to sway the Federal Government to change its current trade practice of Free On Board (FOB) to Cost, Insurance and Freight (CIF).
Disclosing this at a meeting with the newly appointed Director- General of the Nigerian Maritime Administration and Safety Agency (NIMASA) Mr Patrick Ziakede Apkobolokemi, President of the Indigenous Ship owners Association (ISAN) Chief Issac Jolapamo said that Nigeria is the only known country that is still using the Free On Board trade policy to the detriment of its economy.
Jolapamo explained that billion of dollars are going out to foreigners as a result of the adoption of the FOB choice of shipping policy.
He stated that beyond the purchase of the 20 new crude carriers to freight 50 per cent of the nation’s crude oil, the project when fully operational, will also provide about five million job opportunities in the oil, gas and maritime industries.
According to Jolapamo, both the Ministers of Transport and Finance have met over the matter and are expected to brief the President on the out come of their meeting.
He noted that more than 80 per cent of the proceeds from the oil, gas and maritime industries are freighted out of the country which he described as capital flight.
His words “The maritime industry can create more than five million jobs, when you talk of petroleum and shipping , how much the petroleum sector generates to the federation account depends on how much barrel we sell. But how much we retain in Nigeria is not up to 15 per cent and I can prove it, the chunk of it goes out throughmaritime as capital flight.
“If we just keep a little bit of it here and create employment for our people, then Nigeria will be a better place.
“That is what we are after, we are not after making money, we are after developing the maritime industry”.
Already, the group has floated a shipping firm known as ISAN Shipping line and NIMASA has also granted the company a national carrier status.
Members of the group have appealed to Akpobolokemi to impress it on President Goodluck Jonathan to direct the Nigerian National Petroleum Cooperation (NNPC) to give 50 per cent of the nation’s crude to local shipping operators to carry.
Also speaking on the plight of Nigeria’s non-participation in the affreightment of its crude and refined petroleum products, a member of ISAN Chief Chijioke Egwuogu Collins who has the group’s mandate to interface with government said that Nigerians are just on lookers in the booming oil and gas business in Nigeria.
Collins disclosed that the strategy for the repayment of the loan has been carefully worked out adding that as soon as the President gives NNPC the directive and change the trade practice from FOB to CIF, orders to purchase the vessels will be placed.
He explained that the President does not require any legislative process for NNPC to comply with the trade directive.
He stated “As a body we have secure funds to the tune of $1.8billion, we have the funding in place and as we speak the pay back time is seven years,
“We penciled down 20 brand new ships built between 2005 and 2009.
“What we are asking Mr President to do is to change our trade policy and do what the rest of the world is doing. Most of the other oil producing nations sell their crude on a CIF basis. “It is only Nigeria in the last 50 years that has been selling crude oil on a FOB.
“This change of trade policy does not require any legislatio”. All you need is to call the Minister of Petroleum ask whether Nigeria is the only nation trading on FOB basis or not.
“These 20 ship can be brought in batches of five for him to commission
Assuring the local ship operators, Akpobolokemi said he has resolved to increase Nigeria’s participation in both the coastal trade and the shipment of the nation’s crude.