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Nigerian ship owners plan to export crude oil to global markets

Nigerian ship owners plan to export crude oil to global markets

ABUJA: The Nigerian Shipowners Association has said that it is making plans to get involved in the exportation of crude oil to international markets.

Currently, no Nigerian shipowner is involved in the exportation of the nation’s crude which is being carried on a Free on Board basis by foreign flagged vessels.

The Secretary General of the association, Mr. Tunji Brown, in an interview with The PUNCH, said this had become necessary following the persistent fall in global oil prices.

He said, “The current oil prices have discouraged importers from bringing in refined petroleum because the prices are unprofitable. And you know our services lie in the inward movement of refined products into the country via the coast.

“Due to the low patronage we are getting, we plan to be involved in the exportation of crude oil. We have started discussing with the government on this. Even if it is only one million barrels of crude that will be exported, we want to be involved.”

Brown lamented that coastal shipping of refined petroleum products from the point of discharge at Lome had suffered a 30 per cent reduction in patronage.

He said that NISA was hopeful about the upward movement of oil prices in the future so that its members could have jobs.

He said, “There has to be someone who is willing to import the refined petroleum products before we can begin to move them into Nigeria.

“I know offshore oil rigs were previously active; most of the oil companies are not producing. Their cost of production is above $30 and the oil price is about $35 per barrel so they are shutting down their platforms.

“Until they come back on stream, we can’t have jobs. Most of our members have their tankers idle at the jetty with the hope that oil prices will go up.”

Brown added that the association had submitted a proposal to the government for the movement of goods and passengers through the inland waterways to the hinterland.

He said, “We want to explore that sector and raise revenue because it will not be oil dependent. The government can assist by dredging the channels for goods and passengers.”

In a similar vein, the Coordinator, Government Relations, Shipowners Association of Nigeria, Mr. Temi Omatseye, has called on the government to use Nigerian flagged vessels for the exportation of crude. He lamented the continued use of foreign flagged vessels to export crude oil, thereby leading to loss of foreign exchange.

Omatseye said, “The Nigerian National Petroleum Corporation is selling oil on the FOB basis, which means that it is the buyer that charters the vessels. By that, the buyer is not bound to take Nigerian vessels. They nominate their own vessels, which are foreign flagged. All the dollars which are meant to come here move outside this country.

“Government has to insist that we also import these products. The freight component will now be retained by Nigerian shipowners instead of the foreigners. This is a major leakage but unfortunately no one is consulting us.

“Although Nigerian shipowners are getting some of the products to move from Lome to Nigeria, it will be better for us to move the product directly from the refineries and thereafter use Nigerian flagged vessels to distribute within the Nigerian coastlines.”