LADOL justifies sack of Samsung from Lagos Free Zone

ABIOLA Seun |

Following the recent refusal of entry to workers of the Samsung Heavy Industries Nigeria (SHI), the management of Lagos Deep Offshore Logistics, LADOL has justified the sacking of the fabrication and integration company from the free zone over expiry of operating license.

Recall that SHI is the operator of a fabrication and integration yard (SHI-MCI yard) in the zone, which was used to integrate the Egina Floating Production Storage Offloading (FPSO) vessel, and which also has sailed away to the 200,000 barrels per day Egina oilfield.

The SHI-MCI yard is a joint venture between LADOL and SHI, with SHI having 70 per cent stake and LADOL 30 per cent.

The yard is the only one of its kind in Africa, designed to make Nigeria a hub of FPSO fabrication in the continent.

With the current development, it is believed that SHI will lose over $300m of investments if sacked from the island, as it will be difficult for the Korean firm to remove fixed assets in the yard.

But, in a statement over the weekend by the Managing Director of LADOL, Dr Amy Jadesimi, explained that the action was in pursuant to the Samsung’s gross misconduct to compliance of stipulated laid down rules – constant violation of procedures of the Nigeria Customs Service (NCS) and the Nigeria Immigration Procedures.

She said, “As a responsible Nigerian company, Ladol has put public duty and national interest ahead of its private interests and concerns for some time, with respect to the Egina project and the actions of Samsung.

“However, LADOL now has no choice but to bring to the fore issues that have arisen due to the actions of Samsung.

“Samsung’s dealings in Nigeria in the past four years have been fraught with mischief and reckless disregard for all stakeholders. Ladol as business partners, Nigerian regulators, Nigerian workers and citizens.

“Samsung has brazenly and persistently flouted Nigerian laws and breached contracts it duly signed with Ladol and its affiliates. These breaches include but are not limited to:-

“Refusal to abide by Conditions of Service for Nigerian Staff and abuse of Nigerian workers, Violating procedures of the Nigerian Customs Service, Violation of Nigerian Immigration Procedures, Breaches of Nigerian Content Development and Monitoring Board regulations, Refusal to Remit Statutory Tariffs to the Federal Government despite several demands from the Nigerian Export Processing Zone Authority.

“Others are sponsoring the publication of malicious and false information about Nigerian Government Agencies and the business climate in Nigeria, thereby denigrating the Ease of Doing Business regime in Nigeria, Persistent failure to comply with Rules and regulations of the Free Zone.

“Concealing sums of money provided for in the Head Contract from LADOL, their local content partner, demanding huge unconscionable variations from their client (Total/NNPC Joint Venture) and by extension from the Nigerian people, exclusion of their Nigerian content partner from operational activities, and thereby refusing to transfer technology and blatant repudiation of major contractual terms in agreements duly signed with Ladol.”

The MD, however, stated that the inescapable conclusions, due to the frequency and seriousness of the infractions includes, “Samsung’s activities threatens the safety and peace of the Free Zone and of other responsible Nigerian and foreign Enterprises doing legitimate business within the zone, Samsung is committed to operating in a manner that brazenly defies our Nigerian regulators, flouts our laws, maltreats Nigerian workers and sabotages the economy of our dear country.”

According to Amy Jadesimi, as a result of the flagrant disregard to lay down rules, their license which has expired will not be renewed.

She said, “As a result of Samsung’s recidivist operational practices and breaches, the following have now occurred: Samsung failed to meet the minimum standard required to qualify for an Operating License in a Free Zone, their license has therefore expired without renewal.

“Also, Samsung’s Sublease Agreement has been duly terminated and Ladol has filed a court action (Suit No FHC/L/CS/1459/2018) against Samsung related to their fraudulent activities in Nigeria,” she stated.