Nigeria loses revenue as 85% petroleum products berth in Lome

Nigeria is currently losing multi-million dollar revenue to seaport of Lome, Republic of Togo, as Nigerian bound imported petroleum products, brought in by ‘Mother Vessels,’ are first discharged in Lome before using lighter vessels to shuttle them to Nigerian seaports, BusinessDay learns.

Industry operators, who believe that the revenue lost from allowing Mother Vessels to berth in Lome is huge, given the current economic situation characterised by the dwindling state of oil revenue, and also say that about 85 percent of the total imported petroleum products that come into West African sub-region are Nigerian bound.

This, according to them, is largely encouraged by the rigorous bureaucratic bottlenecks surrounding document-processing procedure by the Nigeria Customs Service (NCS) and the rising security concern on Nigerian waters as a result of reoccurring pirate attacks on Nigerian bound vessels.

Anthony Iroegbu, former chairman, Marine Engineering and Naval Architecture (MENA) division, said on the sideline of the fifth annual conference and general meeting of the association held in Lagos on Tuesday, that the revenue lost was obvious in areas like tax, tariff and levies, which Nigeria would had collected if the imported products were brought directly to Nigerian seaports.

“NCS makes it impossible and difficult for Mother Vessels to berth in Nigerian waters due to the rigorous procedure of obtaining documents like Form ‘M’ and bill of lading for the purpose of importation. This is also the reason why Nigerian operators have lost the lucrative bunkering business to Togolese operators, while Nigerians bunkers remain idle,” Iroegbu said.

He observed that the inability of imported petroleum products to directly come to Nigerian seaports had also taken seafaring jobs away from Nigerians, as many foreign seafarers from India, Philippine and other countries, take jobs away from Nigerians.    

According to Iroegbu, bunkering, which is the business of supplying fuels, foodstuffs, water and other needs of ships and their crew members, is a business that is legitimate in the international shipping business, but unfortunately it was often mistaken in Nigeria with the economic monster known as ‘oil theft.’ Iroegbu, who said Singapore rakes in about $65 billion annually from bunkering, advised government to encourage operators of such business under stringent regulation and monitoring.  

He further stated that the nation’s maritime industry and its chain of businesses that benefit directly from the sector could employ about 5 percent of Nigeria’s 170 million population, saying this time of economic meltdown had created an opportunity for Nigerian government to look inward and develop non-oil sectors like maritime to create jobs, wealth and generate revenue for government.         

Nnajiuno Ogbuagu, a ship operator, who blamed lack of adequate security in Nigerian waters for the inability of mother vessels to berth, observed that pirate attacks were taking Nigerian business opportunities away.

He advised Nigerian Navy and other agencies of government in charge of maritime security to invest in platforms that would help in providing adequate security to ships coming to Nigeria. “Nigeria is encouraging Mother Vessels to berth in Lome because government agencies are not providing adequate security on our waters. In most cases, when product vessels come to Nigeria, pirates attack and hijack their products.”

He further pointed to the fact that indigenous ship owners were currently passing through difficult times, and advised ship owners to invest in upgrading the standards of their vessels because Nigerian owned vessels had severally been denied opportunity to participate in Cabotage trade due to inability of operators to meet international classification standards.