A Review of the Nigerian Energy Industry

ISAN decentralises operations

August 14, Sweetcrude – The Indigenous Ship-owners Association of Nigeria,ISAN, has decentralised its operations and inaugurated its Warri Zone in a bid to improve service delivery to its members and give a boost to indigenous tonnage in the shipping sub-sector of the economy.

ISAN Chairman, Chief Isaac Jolapamo, who inaugurated the new zone, said the move was to ensure the growth of maritime activities in the littoral states, adding that other zones would soon be inaugurated in Lagos, Port Harcourt and Calabar, bringing the number to four.

At the inauguration, in Warri, the ISAN boss lamented that Nigeria sold its crude oil to foreign interests on Free on Board,FOB, instead of Cost, Insurance and Freight,CIF, basis thereby causing the nation to lose billions of naira annually.

He said: “Over 600 vessels working as oil rig platforms support vessels in the upstream of the oil and gas sector, but less than 50 are owned by Nigerians.”

The chairman of the zone, Sir Sonny Omatseye, said the association would ensure effective representation of ship- owners in all their dealings with government agencies, shippers and private organisations on matters of mutual interest.

He said: “As at today, we could simply say that due to the poor implementation of the Cabotage Act 2003 Nigeria is losing about N2 trillion due to capital flight and the attendant job loss of five million. When the Nigerian Content Act 2010 is effectively implemented, it would lead to more revenue generation and the creation of more jobs”.

It would interest you to know that Nigeria sells the crude oil at FOB with buyers nominating the vessels for the lifting. The dichotomy in the duty payable by Nigerian ship- owners and foreign ship- owners is another cause for concern. While Nigerian ship-owners pay import duty of over 15 per cent, their foreign counterparts post only one per cent bond for the same number of vessels.

“While Nigerian ship-owners and their crew could hardly feed, illegally resident foreign vessels do all the jobs. Nigerian vessels are denied contracts/employments using various excuses such as age of vessel and classification society of the vessel”.

ISAN is the umbrella maritime association consisting of ship-owners and operators made up of 83 ship-owning companies as members and 41 associate members made up of logistics companies, ship repair yards, ship chandlers, freight-forwarders, stevedores, banks, insurance companies, maritime lawyers and other ancillary maritime service providers.

“The Association was established in 2003 to promote the business and practice of ship ownership and management in Nigeria according to best practices.”

In this article

Join the Conversation