Nigeria: Concession of Seaports - Reps Fault Delay in Review

22 April 2021

The House of Representatives Wednesday expressed worry over the delay in the conclusion of the review and renewal of agreements for the concession of the nation's seaports.

Consequently, the House mandated its Committees on Ports and Harbour and, Privatization and Commercialization to interface with relevant government agencies and other parties to the concession agreement to investigate the cause of the delay.

The decision was reached during the consideration of a motion, titled "Need to Investigate the Delay in Conclusion of the Review and Renewal of Agreements for concession of Seaports," sponsored by Shehu Koko.

In the motion, Koko recalled that the Bureau of Public Enterprises, BPE, and the Nigerian Ports Authority, NPA, on behalf of the Federal Government, anchored the concession of seaport terminals between 2005 and 2006 for an initial period of 10 years, 15 years and 25 years across the NPA Port complexes of Apapa, Tincan Island, Port Harcourt, Onne, Calabar, Koko and Warri, respectively.

He said: "Some of the concessioned terminals with initial tenure of 10 and 15 years have expired while some will expire in May 2021 and needed renewal to avoid losses of hundreds of millions of dollars revenues accruable to the government and direct foreign investment by investors for further upgrade and rehabilitation of the ports to achieve the modernization objectives of government.

"The review and renewal process had commenced in 2016 with the Nigerian Ports Authority, NPA, Federal Ministry of Justice, the Federal Ministry of Transport, the Infrastructure Concession Regulatory Commission (ICRC), the Bureau of Public Enterprises (BPE) and Private Terminal Operators.

"The Concession Agreements that have expired are deemed to have been automatically renewed without the benefit of full renegotiation, provided that concessionaires served the lessor requisite notice of intent to renew in line with the provisions of the Agreement," he said.

Adopting the motion, the House gave the committee four weeks to carry out the exercise and report back for further legislative action.

Meanwhile, the House has mandated its Committee on Nigerian Content Development and Monitoring to investigate the management of ExxonMobil, NAPIMS and NCMB on alleged maltreatment of indigenous service providers. It also urged ExxonMobil to immediately stop further procurement activities on catering contracts and reinstate the contractors who were disengaged without reasons from 2019 till date.

The resolution followed a motion by Henry Nwawuba from Imo State, titled "Urgent Need to Investigate the Corporate Attitude of ExxonMobil against Indigenous Service Providers".

In the motion, Nwawuba noted that ExxonMobil and its affiliates were involved in the exploration and production of crude oil and natural gas and operate joint venture concessions and deep-water production with significant investment in Nigeria.

He also noted that the company and its affiliates had been a committed partner with the Federal Government in its drive for socio-economic growth of the nation.

He said the company had equally been collaborating with various tiers of government by providing employment opportunities for both skilled and unskilled labour in line with the Nigerian Content Development, NCD, Act.

The lawmaker said the company was recently reported to have commenced a contract process which was split to favour foreign companies to the exclusion of indigenous service providers.

He said: "The reports of unfair treatment of Nigerians who render various services to the company, especially the termination of the catering contract of Royalty Hotels and Eden Hotels (catering companies owned by Nigerians) in August 2019 without clear reasons and re-awarding same to West African Caterers (a foreign company); and employing two expatriates to supervise catering services against the NCD Act.

"There is unequal/prejudiced and biased procurement requirements/conditions/processes for catering service provisions targeted at automatically disqualifying proficient Nigerian companies from participating in the new catering technical and commercial bid.

"ExxonMobil, known for appreciable commitment to the rule of law, respect for individuals and maintaining a harmonious relationship with indigenous host communities will begin to, 'without any sense of caution, manifest such indistinct tendencies of economic sabotage, particularly at the highest level of management by ironically disregarding Nigerian government's efforts to ensure the development of local food and non-food products of high quality and standards for local consumption.

"ExxonMobil could exhume such crass abuse and insult to Nigerian government's policy restrictions on foreign food items by deliberately listing ISO 2200 Certification (a foreign safety qualification) as a mandatory requirement in their Technical Bid document for catering service production not minding the logistic difficulties facing Local Catering Companies as a result of COVID-19 restrictions on international movements.

"The glaring deliberate abuse of the Nigerian Content Development (NCD) Act by ExxonMobil and the contract termination of the Nigerian owned companies have caused untold economic hardship to those Indigenous companies and the host communities.

"Also worried that if urgent action is not taken to call ExxonMobil to order, the situation may degenerate to both legal and civil actions capable of undermining the relative peace currently subsisting between the parties."

Adopting the motion, the House gave the committee week weeks to conclude its assignment and report back for further legislative action.

Vanguard News Nigeria

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