Senate: Nigeria loses $120m to foreign shipping firms

From Fred Itua, Abuja

Worried by claims that Nigeria loses over $120 million annually to patronage of foreign shipping firms in the importation of petroleum products, the Senate, yesterday, directed the Nigerian National Petroleum Corporation (NNPC) to initiate processes of patronising and boosting the capacities of local shipping firms.

At a meeting between the Senate Committee on Local Content, the NNPC management and Ship Owners Association of Nigeria, it was disclosed that the overwhelming preference to foreign firms had resulted in huge revenue losses, including about $120 million loss to demurrage.

Chairman of the committee and former Senate Leader, Tealim Folarin, in a ruling after a marathon debate, directed that the NNPC should allow local ship owners operate in transportation of petroleum products 

The committee equally stated that there is need to build capacities among indigenous shipping.

He said: “It is very important we patronise indigenous shipping. The whole essence of this investigative hearing is not to trade blames. We understand that they don’t have enough vessels; they don’t have capacity, and capacity cannot come from heaven. The Group Managing Director (GMD) here has capacity to help build capacity. It is very important that we patronise indigenous shipping companies.”

The Senate panel decried the disregard to the local content act which stipulates, among others, that local firms be encouraged in the conduct of businesses of any public company.