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Senate To Investigate Actions Of NNPC Regarding Freight Of Petroleum Products


The Senate on Wednesday resolved to research the actions of the Nigerian National Petroleum Company in making certain participation of indigenous firms within the freight of petroleum merchandise, in step with the provisions of Presidential Executive Order 5(2018).

This was predicated upon a name by Senator Ramoni Olalekan Mustapha searching for an investigation into the breach of Nigerian legal guidelines by overseas vessels in coastal delivery of petroleum merchandise within the downstream sector of the Nigerian Maritime University.

Senator Olalekan Mustapaha (APC, Ogun East), famous that the National Content (NOGICD) Act 2010 was enacted to advertise worth addition to the National Economy by stimulating progress and industrial growth within the Oil and Gas Sector of the Economy.

According to the lawmaker, “The influx of foreign vessels into the Nigerian downstream sector is alarming against the Coastal and Inland Shipping (Cabotage) Act 2003 which clearly restricts vessels engaged in domestic coastal trade.”

He added, “Only wholly-owned, manned and registered Nigerian vessels can engage in the domestic coastal carriage of Petroleum products within the Territorial and Inland Waterways.”

Senator Mustapha stated that during the last fifteen years, indigenous tonnage capability and coastal delivery capabilities have grown exponentially with Nigerian operators proudly owning a number of tanker vessels of their fleet.

The lawmaker said that although NNPC is the biggest employer of downstream delivery companies in Africa, the company’s actions when it comes to alternatives and indigenous capacities haven’t been enhanced.

He said that the Capital freight spent by NNPC by Direct Sale of Crude Oil and Direct Purchase of Petroleum Product (DSDP) is roughly USD$60 million month-to-month to about USD$720 million yearly.

“The value of DSDP for 2019/2020 contract period is at the range of USD$9 billion, out of which foreign ship-owners amount for one hundred percent of freight associated with this downstream activity, most of which is repatriated overseas to the detriment of the Nigerian economy”, Senator Mustapha lamented.

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The lawmaker added that the shortage of Contract of Carriage and the absence of assured cargo tonnage within the Maritime Industry have led to important loses and collapsed of home and indigenous delivery.

Consequently, the Senate, in its resolutions, mandated the Committees on Local Content & Compliance to research the explanations for the dominance of overseas vessels above regionally owned, manned and registered vessels within the home carriage of petroleum merchandise inside the coastal territory and inland waterways of Nigeria.

The Upper Chamber additional resolved to research overseas ship homeowners of freight related to downstream actions repatriated abroad by NNPC to the detriment of the native financial system or patronage.

Also to be investigated is the flagrant abuse of the NOGICD Act 2010 and Cabotage Act 2003 respectively, by the operators and stakeholders within the Maritime Industry, by a ship-ship switch with the coastal overseas vessel.

In its movement on Wednesday, the Senate mandated the Committees on Local Content and Petroleum Downstream to hold out an investigation with a view to unraveling the inflow of overseas vessels within the coastal area and the extent of patronage of Nigerian delivery firms.

Meanwhile, members of the Senate on Wednesday thought of a movement on the ‘escalating rate’ of unemployment within the nation.

The movement was sponsored throughout plenary by the quick previous Deputy President of the Senate, Senator Ike Ekweremadu.

In their decision, the lawmakers proffered options to the chief arm of the federal government for adoption and implementation.

One of those is for the Federal, State and Local Governments to declare emergency on the availability of employment throughout the nation.

The senators additionally referred to as on the Federal Ministry of National Planning to place the required mechanism and programmes in place to attain this.

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