By Ayobami Adedinni
Collaboration between stakeholders has been described by the Director General, Nigerian Maritime Administration and Safety Agency, (NIMASA), Dakuku Peterside as a key to the success of the maritime sector of the nation’s economy.
He said an enabling environment needs to be created for vessels to operate in the Oil and Gas industry stressing that Nigerians need to own and build shipyards.
According to him, the NOGIC ACT empowers NIMASA and the Nigerian Content Management and Development Monitoring Board, (NCDMB) to collaborate in order to encorce Local Content in the industry.
In his words, “there is only one agency mentioned in the entire NOGIC ACT where-in it was directed that NCDMB should collaborate with NIMASA, Nigerian regulator of the maritime industry. It was stated that NIMASA and NCDMB should collaborate to enforce local content in the oil and gas industry.
“There is a study that shows that if you do an analysis of the investment we need from exploration, production, storage and perhaps transportation of crude oil and gas very often, the maritime component account for between 10 per cent and 20 per cent of expenditure in the oil and gas industry.
“Now, receiving more for a project like Egina, if you look at the entire project, it is a maritime project for oil and gas activity. If you are talking about local companies, which we have identified that maritime componenst account for 10 per cent and 20 per cent, and you remove between 10 per cent or 20 per cent ,you can see we will be discussing local content on 80 per cent or less in the oil and gas industry.
“The import of that, we can’t truly be talking about local content without looking at the maritime companies.
“Far in place before Nigeria put in place the NOGIC ACT popularly known as the Local Content Act. In the maritime industry, we have been initiating local content.
“In 2003, we led the rest of Africa to be the first country to pass The Coastal and In-land Shipping Act known as the Carbotage Act. We did that for the entire continent of Africa and since then other African countries are struggling to catch up with the Nigerian Carbotage Act.
“Because of foresight, we realized that if we truly want value addition and capital retention in-country, maritime is one area you must focus on and i think we make some progress during that period.
“Talking about local content, we need to look at the Maritime component starting from exploration, production, storage and even when you produce to take it outside the country is even worse because as we go deeper more offshore in our production,” he said.
Speaking further, he said a lot has been done to strengthen collaboration adding that the sector has the capacity to generate employment.
He said, “There is a recent study that predicts that in the next six to ten years, 80 per cent of our oil and gas will be offshore which means that it will require more maritime services in the oil and gas industry.
“We have some extracollation that if we get things right, we will have over a million Nigerians employed in the maritime industry in the next two to four years.
“The maritime industry is capital intensive and it also has the capacity to generate employment. The maritime industry covers a lot in terms of value addition, capital retension and more.
“And if you require more maritime services in the oil and gas industry and you are talking about local content, it is indeed the maritime sector you should focus on.
“The maritime industry is a long value chain and i can mention a few countries that their economies are sustained by the maritime activities. In 2014, maritime remittances brought in to the economy of the Philippines $5.5 billion in the next year 2015, the remittances that came from maritime, seafearers actually turn to $6.5 billion.
“If you look at the Nigerian budget last year and this year, that amount of money will account for One Third of our budget. So, if remittances from seafarers alone can account for One Third of our budget, then talk about the entire component of the maritime industry,” he stated.
According to him, the challenges identified through collaborative efforts include Manpower gap, proper vessel categorization, among others.
He said, “One of the things coming out from the collaboration is that we have identified, that there is a man power gap that we need to address.
“To address it, we have decided collectively to conduct an extensive manpower audit and to conduct this manpower audit, we are looking at ocean going vessels, carbotage vessels, offshore facilities and all of that. We are trying to figure out the kind of manpower that we need in the short-time, medium term and long-term.
“The other thing the collaboration is throwing up is that we haven’t done proper vessel categorization. Right now, there is a categorization bond by NIMASA as the official ship registry of Nigeria as well as the regulator of the maritime industry.
“We also want to look at the vessel projection requirements in the next 5, 10 and 15 years to come. It will enable us to plan towards it and discuss with Nigerian investors that the vessels is going to be viable in the next 5, 10 or 15 years so you need to plan to acquire these vessels and as you acquire the vessels there will be no excuse for anybody to bring in foreign vessels to Nigeria. That is to say, industry players will be forced to use Nigerian owned vessels, built in Nigeria.
“Another thing that the collaboration is throwing up, is an extensive audit called The Shipbuilding and Ship Repair Facilities we have in-country and what we can do to build capacity. In this collaboration, NIMASA has been charged to conduct an extensive audit of shipbuilding facilities, ship repair facilities we have in the country and we have already taken a number of steps in that direction.
“In the next five to ten years, short, medium and longterm, we don’t want to hear that anybody is taking his vessel for drydocking outside the country because we are going to have all the drydocking facilities in Nigeria.
“In doing this, we are beginning to look at different kind of investment in shipbuilding and financing industry.
“As we go further in the collaboration, we will continue to support local content drive in Nigeria as we understand there is a challenge that there is no steel in the country and there is a need to develop our steel industry if we really want to improve of shipbuilding industry.
“We will indeed practicalize the Nigerian Content Act and begin to showcase to the world success stories of the Nigerian Content Act and Carbotage Act,” he added.
