Maersk groans under NPA sanction - as Nigeria blocks cargo access to its vessels

Maersk Nigeria Limited, one of the recalcitrant foreign shipping lines which the Nigerian Ports Authority (NPA) recently hammered for non-compliance with provision of holding bays, is presently reeling under grave economic loss.

Following the 10-day suspension of its services, the Nigerian government has blocked all its liners destined for Nigeria to have access to cargo.

Investigations revealed that this has resulted in huge loss to the foreign shipping company while operations at Nigeria’s main container terminals and their environs have experienced significant disruption over the past week.

On July 14, the Nigerian Port Authority suspended the local operations of Maersk Line, Cosco Shipping, Africa Port Services and Lagos & Niger Shipping Agencies for ten days over an alleged failure to provide holding space for empties.

The NPA asserted that a shortage of storage bays was to blame for the notorious, severe truck traffic congestion around the Lagos Port Complex and Tin Can Island, a longstanding problem for Lagos residents.

“The suspension follows the Authority’s checks, which revealed that the four companies have failed to fully comply with the directive to acquire and operate holding bays as they have either failed to utilize their holding bays at all or do not have adequate capacities,” NPA alleged.

In addition, NPA accused the carriers of making Nigeria a “dumping ground” for empties due to the nation’s imbalance of trade. Empty containers that remain in the destination country are often resold for other economic purposes, and in the U.S. they are frequently redeployed for storage, housing, mobile offices and other uses.

In a statement, Maersk’s Nigerian subsidiary acknowledged that empties were part of the port’s traffic problem. “With limited infrastructure and other alternatives for evacuation of imports, return of empties, and return of full exports, it is challenging for these containers to be adequately handled, which results in the congestion of the access roads,” Maersk Nigeria Limited said.

However, the firm says that it operates within compliance, and that it has adequate storage. “It is [misguided] for NPA to suspend Maersk Nigeria Limited for failing to acquire and operate holding bays for empty containers, as Maersk Nigeria Limited operates four holding bays within the Lagos environ with a storage capacity of 8,150 TEUs, which is more than 50 per cent of the discharge average,” the statement said.

In a notice to customers, Maersk said that it would be forced to hold cargo from discharge at Tin Can, Onne and Apapa. It listed 19 vessels that would be affected by the halt, including many with multi-day schedule delays.

Meanwhile, the Nigerian Ports Authority (NPA) has debunked the claims of the Maersk Nigeria Limited that it has four holding bays in compliance with the directive of the government agency.

It would be recalled that the NPA suspended the operations of four shipping companies, including Maerskline, for 10 days over their failure to comply with the directive of the agency for the shipping agencies to have holding bays that will accommodate their empty containers.

However in a swift reaction, the government agency said nothing could be farther from the truth.

In a telephone interview with Malam Isah Suwaid, the Assistant General Manager, Corporate and Strategic Communications, NPA said from the record available to the agency, Maersk Nigeria Limited has only two holding bays with a combined storage capacity of 1400 TEUs.

“In February 14th, this year, NPA carried out an audit in conjunction with the committee on shipping companies to determine the available capacity of storage of empty containers at the off-dock facilities of shipping companies.

“Maerskline at that time had holding capacity for 1000 TEUs empty containers at its Unity bonded terminal.

“At its PMS (HBX) holding bay at Apapa, it has 400 TEUs container capacity”, NPA spokesman declared.

Malam Suwaid further disclosed that the audit report was signed and certified by an official of the Maersk Nigeria Limited.

“For them to claim they have four holding bays is standing truth on its head” Suwaid noted.

He stated that the embattled shipping line put up this spurious claim in an attempt to safe its face with its teeming customers.

However, NPA has vowed to follow up with the sanction if the affected companies fail to make any appreciable progress towards compliance as the 10-day suspension was just the first instance in the series of punitive measures lined up against recalcitrant shipping companies.

Other shipping companies suspended alongside Maerskline were Cosco Shipping, APS and Lansal shipping.