The Senate on Wednesday at the plenary mandated its Committee on Local Content to investigate reasons for the dominance of foreign vessels above locally owned and registered vessels in the domestic carriage of petroleum products within coastal inland waterways of Nigeria.
The resolution of Senate is a sequel to a motion on urgent need to investigate a breach of Nigerian laws by foreign vessels in coastal shipping of petroleum products in the downstream sector of the Nigerian maritime industry.
The motion was sponsored by Sen. Mustapha Ramoni (APC Ogun) and co-sponsored by 10 other senators.
Presenting the motion, Ramoni said Nigerian Content Act 2010 was enacted to promote value addition to the national economy by stimulating growth and industrial development in the oil and gas sector.
The Senator said the influx of foreign vessels into Nigeria downstream sector was alarming against the coastal and inland shipping Cabotage Act of 2003.
Ramoni emphasized that the act clearly states that vessels engaged in domestic coastal trade to be wholly owned, manned and registered Nigerian vessels and can engage in domestic coastal carriage of petroleum products within the coastal inland waterways.
He said that more than 15 years, indigenous tonnage capacity and coastal shipping capabilities have grown remarkably with Nigerian operators owning multiple tanker vessels in their fleet.
According to him, the Nigerian National Petroleum Corporation (NNPC) was the largest employer of downstream shipping services in Africa on account of its Direct Sale and Direct Purchase (DSDP) of petroleum products and vessels service contracts.
Ramoni said in spite of the numerous opportunities generated via the activities of DSDP, indigenous capacity and capabilities have not been enhanced.
According to him, the value of DSDP for 2019/2020 contract period is at the range of nine billion dollars out of which foreign ship-owners amounted to 100 per cent freight overseas.
seconding the motion, the motion, Sen. Ibikunle Amosun urged his colleagues to support the motion.
He said the adoption of the motion would stop capital freight, create jobs, increase technology and ultimately improve local content.
Following the debate, the Senate in a unanimous voice vote also mandated the committee to also carry out an investigation on the level of patronage of Nigerian shipping companies.
It also mandated the committee to investigate foreign ships owners and freight associated with downstream activities that were repatriated overseas by NNPC to the detriment of local patronage.
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