$120m petroleum shipment fees: Senate asks NNPC patronize indigenous firms

Senate on Tuesday directed the Nigerian National Petroleum Corporation (NNPC) to prioritize enlarging the capacities of Indigenous shipping firms and also patronize them to save Nigeria of the $120 million annual loss to foreign companies in the shipment of petroleum products.

This was a decision reached by the Senate Committee on local content after a meeting with the NNPC management and Ship Owners Association of Nigeria where it was revealed Nigeria loses more including some $120 million loss to demurrage, using foreign firms. Chairman of the committee and former Senate Leader, Tealim Folarin, in a ruling at the meeting directed NNPC to allow local shop owners to participate in the transportation of petroleum products “It is very important we patronise Indigenous shipping. The whole essence of this investigative hearing is not to trade blames.

We understand that they don’t have enough vessels; they don’t have capacity and capacity cannot come from heaven. The GMD here has the capacity to help build capacity. It is very important that we patronize indigenous shipping companies.”Folarin said.

Also speaking, a member of the committee, Senator Solomon Adeola, who is also the chairman of the Senate Committee on Finance highlighted the economic consequences of using foreign firms, saying Nigeria had been worse for it. Adeola dismissed submissions that Nigerians do not own vessels that could be patronised.

“There are local vessels owned by Nigerians, it depends on the type of vessels we are talking about. There are two types of vessels”, he said. Reacting, the group Managing Director of the NNPC, Mele Kyari who had informed the committee earlier of no Indigenous vessels to patronise, however, promised to engage local partners. “I am going to work to support these companies. We will engage our partners”, he said.