Amaechi, Ladol and the Maritime Crisis

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By Tarila Benson

The lingering crisis in the maritime sector appears to be heading towards a resolution. Going by an online publication, www.maritimematters.com.ng, the Honourable Minister of Transportation, Rotimi Chibuike Amaechi, seems resolved to bring this crisis to a close.

In a memo he was said to have written to President Mohamadu Buhari, according to the online publication, Amaechi was emphatic that it was time for the maritime industry to move forward. Amaechi’s letter dwelt on the designation of ports terminals and classification of cargoes which followed the concession of the ports in 2006.

To get the President to appreciate the position his ministry has taken on the issue, Amaechi took Buhari through a concise history of the ports concession. He told the president that “the reform was aimed at reducing the cost of port services, increase efficiency in port operation, freeing government from costs of developing or managing port operations and improve revenue to the government”

The Honourable Minister added that, soon after the commencement of the port concession exercise, some concessionaires and even private jetties started diverting vessels laden with oil and gas related cargoes to non-oil and gas terminals and jetties instead of those designated to handle these cargoes.

The stakeholders meeting he therefore called on 22nd February 2016 was to address this oil and gas cargo dispute and classification of terminals’ question.

It is important however to state that President Olusegun Obasanjo, the architect of the port concession and his successor, Umaru Musa Yardua tried to resolve these issues but the disputes persisted essentially because both the port operators and government agencies, including NPA and the Ministry of Transport, remained incalcitrant as Presidential directives were consistently violated.

However Yardua’s successor, President Goodluck Ebele Jonathan gave what many consider a clear and final directive on the oil and gas cargo controversial issue. Precisely, on April, 27th 2015, NPA sent a directive from the president to all terminal operators and shipping companies. The directive stated in clear terms that all oil and gas related cargoes must berth at the designated terminals in Onne, Warri and Calabar.

The directive also ordered LADOL Integrated Logistics Base, to move its fabrication yard to Agge in Bayelsa State. Many of the concessionaires led by LADOL have since challenged Jonathan’s directive in different courts and the cases are still pending in these courts.

This was the situation Amaechi met on ground on his appointment. The Honourable Minister frowned at this back and forth movement and flip-flop of presidential directives and decided to tackle the oil and gas cargo demon once and for all.

In the said memo to the President therefore, Amaechi, explained to the President, how he came into the oil and gas fray. According to him, “Messrs Julius Berger protested the categorization of the terminals by BPE which led to my convening of stakeholders meeting on 22nd February, 2016 and 21st – 22nd March 2016”. He explained that his ministry, “after analyzing the submissions of the various stakeholders, decided to respect the last presidential approval dated 19th April, 2015 and all relevant government directives on the categorization of the terminal”. The minister adds that the Presidential approval states that “all oil and gas related cargoes must be handled only at the designated terminals as in the letter of BPE”.

The meeting however took a different dimension according to the Honourable Minister, when LADOL, a company that has refused bluntly to obey a presidential directive to move its fabrication yard to Agge in Bayelsa State, made an appeal to him to rescind the last Presidential approval made 19th April 2015 and to replace it with an earlier approval made by the then president, dated 4th August, 2008. According to Amaechi, in the process of making their case, “LADOL exhibited a correspondence between the Presidency and the Ministry which were by right, Top Secret communications with Mr President’s handwritten directives”.

The Rivers state born Honourable Minister of Transportation received further shock from LADOL when he instructed the Permanent Secretary in his ministry to write the logistics and fabrication company to explain how they penetrated government confidential files to obtain a Top Secret paper. As he put it in his letter, he soon discovered that the Top Secret memo had been “exhibited in the bundle of documents they have filed in court against the government”.

What seemed to unnerve Amaechi the most however, according to his memo to Buhari, was the discovery that LADOL had allegedly been using forged documents to further its business interests at the ports. In his epistle he stated, “…….. it came out at the meeting that LADOL had in fact circulated a forged gazette falsely claiming that the then Honourable Minister of Transport had approved the designation of LADOL Free Zone as a deep Offshore Logistics Base, and was thus allowed to receive two ocean going ships per week”. But the minister’s detailed investigation put the lie to LADOL’s claim. This is how he put it. “Upon enquiry at the Federal Ministry of Justice, it was discovered that the gazette was a forgery”.

The minister stated that the revelations at the stakeholders meetings and his findings left his ministry with no choice but to take the position “to rely on the last Presidential Approval in order to put an end to the issue of stakeholders petitioning each incoming Administration, such that the President would overturn the approval given by his predecessor on the same issues giving rise to an unending series of policy summersaults in this very critical sector of the economy”.

The firm position the ministry has taken on this designation of the ports, the minister lamented in his memo, has resulted in a threat to his person.

Yet, the minister’s worries transcend LADOL’s alleged forgery and pilfering of government files or even threat to his person. He is worried about the huge revenues which the government is losing as a result of the indiscriminate berthing of oil and gas cargoes and much more worried by the inconsistency of NPA which ordinarily should be the arrow-head in the quest to increase government’s revenue drive at the ports by putting an end to the diversion of oil and gas cargoes to other commercial ports. Instead NPA wrote the Ministry a letter which he said “seems to have been precipitated under pressure as it completely contradicts its earlier position on the issue”. His suspicion of foul-play and NPA’s contradiction of itself as he put it in his said memo to Buhari, arose from the fact that “…… at the instance of NPA, BPE had forwarded a certified true copy of the terminals categorisation to the Ministry, reaffirming that the categorisation is without prejudice to the Concession Agreements”.

For Amaechi and his Ministry, this categorization of ports must be protected because while the commercial and non-oil and gas terminals pay a paltry 1.1 USD, for oil and gas cargo, the operators of oil and gas terminals pay a special rate of 5.83 USD per ton of the same cargo to the government.

If government must increase revenue generation at the ports, therefore, Amaechi stressed that the categorization of the ports and the classification of oil and gas cargo as contained in the last Presidential directive of 19th April 2015 must be sustained in accordance with the position of the BPE as encapsulated in their letter.

–Benson wrote in from Yenagoa.