Managing Director of the Nigerian Ports Authority, NPA, Hadiza Bala Usman recently visited the corportae headquarters of Vanguard Media Ltd. publishers of Vanguard Newspaper. She spoke on the problematic Apapa traffic, why the eastern ports are under-ultilised, intermodel connectivity at the ports, availibility of scanners at the ports and many more issues.
Excerpts:
The issue of Apapa and Tin-can port congestion has been in the news for long and stakeholders have been going through horrible experience. Have you people given up?
I’m quick to say it and I can tell anyone that we are not doing as well as we should. I am also quick to say, that I welcome ideas and suggestions on how we can improve. We are all stakeholders in the Nigerian economy as it were beyond me holding position, we are all Nigerians, we need to see the country develop and progress. I am keen to see the country develop and progress, we are all partners in this, so I welcome ideas because no one has monopoly of knowledge and people see things from different perspectives and proffer solutions to some certain things in the areas you have never thought of.
Even when you sit in the position that require you can take certain decisions but sometimes, it is important to have an open dialogue and encourage people to provide feedback. So on that note, I will begin to speak about few issues: one of the thing that is burning in everyone’s mind is the continuous congestion we have seen on the access into the port locations especially the Tin-can / Apapa port areas, I have discussed all the things I have said to the minister of works continuously that it is not an issue of increase in volume of cargo, actually the lowest cargo we realized, was within this period, we have had higher volumes of cargo between 2012 and 2013.
Equating the congestion with the volume of cargo is not correct. Let us look at the actual position and how we can improve in it. One of the things is the absence of intermodal transportation, system where you have a situation where 90 percent of cargo coming into the port is evacuated by roads; it cannot be efficient. In every normal port operations, you have intermodal transport system; you have rail evacuation, inland waterways evacuation and then road. As long as you continuously evacuate all your cargo on the road, the roads will be congested, the roads will be in a bad state and we will continue to have the congestion.
So as a country, we need to understand the need for intermodal transportation system, we have made that very clear and I think one of the first things I said at the World Maritime Day Conference I attended, I think three months after I was appointed, I extensively spoke about it, I have written severally to the minister. There was on-going concession with Nigerian Railway Cooperation, NRC which seems to have fallen through.
Also, the on-going rehabilitation works that was supposed to be done, that also is not very clear, China Civil Engineering Construction Corporation Ltd, CCECC is currently doing a construction which we believe will assist us. Also we have been discussing with them on how to improve the NRC, needs more wagons, so the operation capacity is not there but the minister of transportation is very keen to address that. In that same vein, the president have approved that all ports should be linked to rail connection.
So, all our port locations are now part of the master plan for rail development which is very important. We also encourage the utilization of inland waterways; we have requests for movement of cargo using the badges, we have had rails connected, they have started, others have started, we have about 15 applications, we have granted approval to about 6 for them to evacuate cargoes using badges and they are doing that.
But indeed we need to work harder in terms of rail deployment and that is why we are very keen on connection to the inter-land, it is very important. When you see the number of tank farms allocated in this location, tank farms are a huge concern; they are a huge environmental concern, safety concern. We need to see what can be done to invest on the utilization of pipeline; this is what they are currently planning to do with Dangote as they are working in the refinery.
We are encouraging the utilization of pipeline in evacuation of liquid cargo and maintain that no additional tank farms should be approved in this location anymore. We have seen a few that have sprung up which the Department of Petroleum Resources, DPR as you know grant the approvals. So we have seen one that have come up and sort of stopped it. The ministry of works have gotten approval for the full construction of Tin-can island access road all the way to toll gate. It is a N72 billion project approved on a Public, Private Partnership, PPP basis with Dangote group which is a tax credit project. It was approved about 4-5 weeks ago.
I am in a hurry to have them start. I asked the Lagos comptroller of works to start up preliminary discussions on how we can reconstruct that road in an efficient manner, meaning where will the diversions be, where will the construction start from, how do we manage the traffic, what issues have arisen. So that meeting is pending and the agreement that will be signed. I have spoken with Dangote and minister of works on that. So let just see how much we can push, what we can start, so the rehabilitation of the road will commence.
It was approved using the tax credit and that tax credit is based on PPP is an amortization kind of project. What it seeks to do is to insulate the project from being abandoned. Somebody that is familiar with deployment of budgetary provision knows that if you have a budget of this size, N72 billion, typically you have provision of N2 billion, N1billion, N1.5 billion in bits, and also to the extent the National Assembly approves. So for example, a N72 billion project will take maybe 20 years for budgetary provision for it, and that has resulted in a lot of project being abandoned.
You see a project that have started, maybe the lifespan of four years. Within that period there is a change in price, so you will see that project is abandoned, the mobilization will go back and forth, these are the attendant issues that are around normal budgetary provision.
On trailer parks license , what is the exact situation?
We have the need to deploy trailer parks as you are aware. You see trailer drivers literally wake up in the morning and drive to the port and some of them do not have anything doing there just roaming around. They are really not tied to any collection or any cargo. So we are licensing trailer parks, only trucks coming from licensed trailer parks can have access to the port, we have done advertisements seeking expression of interest in license.
Nigerian Ports Authority, NPA cannot build trailer parks, it is not part of our work, what we actually do is to license it and say; there are five designated trailer parks we use to access the port, and all trucks must be housed there pending use of a call-up system. So you are only out on the road if you are coming to collect cargo from the port. And in the same way, certain fleets that has more than one truck they probably have their own fleet and obviously have a trailer park where you are housing them. So let us know, we want to inspect your trailer park, if it meets our requirements we install an Information Technology, IT, for the call-up system in that trailer park and we will link you up. We have done an advertisement and we received about five expression of interest with evidence of the land that they have. We have further written to the Lagos and Ogun state governments. I met with the governors and told them that trailer park designation domiciled with state authorities and local government authorities, they will designate a land and say this is for a trailer park. They said they will fast-track that; the Lagos state government has started with Orile as one of the trailer parks that we would license for them. Certain construction works are still going on there. We also have a trailer park in Tin-can Island which is also being constructed by the ministry of works, that has been abandoned for quite a long time, they have not completed it, we have asked for a handover to enable us rehabilitate it but that has not been forthcoming too. They said they have a historic contract with the last contractor that was given that project; the completion was a shore line protection which has not been done and that is part of his contract, so you cannot break it and give another one. The bottom line is for ministry of works to get it done so that it can be utilized. They said they have gotten an approval, back and forth but it is imperative.
There are also operational issues that cause decays at the ports contributing to the congestion. What is going on this?
To talk about congestion of cargo, there are also operational efficiencies of our port. We need to improve on that. We lack scanners in our port locations, all cargoes are physically examined, as you are aware Customs have recently gotten approval to procure some mobile scanners, so I’m hopeful that will ease some of the concerns with the inspection of cargo, but in a long term proper scanners need to be deployed in port locations to enable us have the level of efficiency required in our port. There is also a discussion around the fact that we have cargo diversions leaving our port to neighboring port; Cotonu port, Lome port and all that, we have looked at the challenges, indeed our ports need to be more efficient especially on single windows which is meant for trade facilitation, all agencies of government involved need to use a single network and fill out their forms and make the necessary payments. It fundamentally changes the dynamics in port operations, and for single windows, it is not even just the sea ports, it also includes the land ports, but because the volume of cargo coming in is from the seaports, they are agitating more than the land ports and the air ports.
Why is the eastern ports under ultilised?
There are agitations around the eastern ports that Nigerian ports Authority, NPA seem to have ignored the eastern ports; they seem to concentrate on the Apapa and Tin-can Island ports. This is contrary because we strictly deployed all our revenues which is tied to which port generates what, we don’t tie our infrastructure development to revenue generation per port cause if we do that some ports will be disadvantaged, that means you will not be able to utilize revenue generated from one port to another port,.We actually don’t do that. Eastern ports are Calabar, Delta, Port Harcourt, Onne, these are the ports located in the eastern parts of the country. The Calabar had a draft limitation issue, we had an existing managing terminal that we terminated due to gradual dredging works, we have initiated a new process which… the cost of dredging Calabar port is N50 billion because the channel is long and wide, the capital investment require to attain draft of about 10 meters, 7.5 meters, so when you do that kind of dredging you do maintenance dredging because of the rate of assentation. So we are quite well excited when we have the flag bottom vessels calling to the port and we engage the stakeholders, we even engage the manufacturers of the vessels they are in Greece but they will rather encourage that them we invest in the dredging and they will use their bigger vessels everywhere.
But Nigeria as a country, we need to define what our priorities are, but nevertheless, we are proceeding for the procurements of Calabar dredging.
I will move to the Port Harcourt; it very old, it has reached to its full lifespan and no more work can be done in the Port Harcourt in terms of rehabilitation, I just recently approved commissioning of study which will be the conditional summary and study of the port to determine and sort of sign off on whether it has reached the end of its lifespan. When the report comes out, we will now make the report public and government will now take a decision on what needs to be done in the Port Harcourt port location.
The Onne port, I’m sure you are familiar with the port being the revenue driver around oil and gas cargo and provide us huge volumes of revenues with the oil and gas operations. In the last year because of the price of the crude drop in the activities that we’ve seen, a marginally increase in those activities, Onne is very commercially viable.
We also look at the need to develop the inter-land connection of these ports; you have your cargo going to Onitsha or Aba, there must be a connection even when the dredging is going on.
On Warri port, Warri port is an area that has a lot of oil and gas activities. We recently got approval for the dredging of the Escravos bar that has not been dredged since the 1980’s; we are dredging it to 7.5 meters. That is the maximum you can dredge it to in view of pipes that are buried there. NNPC pipes that are buried there so we cannot go below that, idealy we should go below that but we are unable to go below that.Warri port is an area that has alot of oil and gas activities.We recently got approval for the dredging of the Escravos barth at has not been dredged since the1980’s, we are dredging it to 7.5 meters.That is the maximum you can dredge it to in view of pipes that are buried there. NNPC pipes that are buried there so we cannot go below that, idealy we should go below that but we are unable to go below that,
In the process of the award we had several petitions by a company alleging that we awarded the contract to a company that has been indicted, convicted for corruption.
During the tender process our attention was drawn to that while we were tending it, we now sought clarification from the company that you are said to have been convicted for corrupt practices relating to Nigerian ports.
So it is interesting. I will just take you on this and will also discuss the issue surrounding the conviction. We wrote to them and they replied us sending us a legal document which sought of certified that they were not.
We now attached those documents and submitted to BPE. So we were further mandated to do an independent investigation, so we hire a law firm and the law firm did an independent investigation whether they were convicted.
The finding is that the company has a subsidiary which is a legal entity like the parent company, the subsidiary had partnered with us in one of our joint venture, the Bonny Channel Management Company, BCC.
One of the subsidiaries does dredging in Africa and all over the world, so that company is the one that tendered for the contract, it is a legal entity. The company that was convicted was convicted for paying Nigerians, NPA staff and Federal government staff; we have people from the ministry, people from the advisers to the former President.
I got the conviction document when they were convicted and I submitted to the EFCC saying this is the conviction document, this are the parties involved, this is the amount of money given, this are the people given, EFCC please go and investigate.
One of the things the company said about the conviction was that we paid money to so and so people because they refused to sign our invoice unless we paid them. We have invoices for the work done but they would not pay.
This your war with shipping lines, you provided scene of when two elephants fight, the grass will suffer; we the motorists and the residents are the grass that are suffering this your war with the truck drivers. Removing them from the port and putting them on the express road, if you pass through Oshodi, they now form about 3 1/2 lanes, and they are paying N1000 or N2000 to the police, what are you doing to remedy that?
Secondly, without Dangote Nigeria is not moving forward, he is working on the refinery, construction of roads, now evacuating the liquid; what happened to Atlas scope? Is it now irreparable after the militants damaged it two years ago?
I can see that the river port…?
About the empty container access, we realized this issue immediately we started getting empty containers, what we use to do is to have, for every container once you are going in, you should go and come out with empty container, so you don’t go I except when you are taking cargo out as well, so in certain instances the stacking areas in the port location is filled up and there is no way were they can stack the boxes pending when the vessels comes to take them out. So these are the issues that we are grappling with as we seek to ensure that backlog of empty containers and also noting what is going to come out of the port. So if you have all the empty containers going in and then at one point, then such other cars are going in to bring out the same cargo; so what we lay in is that every container should be in and out of one truck; as one truck is going in to drop, another one is going in to pick, you see two trucks going in for maybe literally one task one truck can do to turn around and go. So, we realized that from the beginning and we developed a system to ensure that as they are going in they supposed to go in and pick up cargo on their way out, so that is something we realized and once we’ve started this and it is an issue for the empty containers.
People fought to define when the empty containers should go to the port, we have explored that option but the owner of the container might be ready but that might not be when the vessel is ready to evacuate it and standing there might not be enough that taking empty containers over the weekend when there is less traffic, so they go in during the weekend and drop them but do we have enough stacking lands when the vessels have not come to pick up the empty containers; so these are all the things we are looking at as we seek to conclude on the development of a streamlined process of implementing vessels. So if we have been implementing this all this while treating issues that will come up and see how we can address them, so these are the trilling issues you mentioned and we are giving them the necessary attention.
You mentioned Atlas Scope which is also not within our reach, we have raised the issue to DPR to the extent that evacuation of liquid, there ae safety issues more like… but of course not something we can do but we have notified the relevant government agency that is responsible for that.
You asked about the river ports, these are being supervised by the Nigerian inland waterways. So we have established them, there are components of dredging that we need to do this is from my interaction and ministerial level with NIWA, in fact asked us to lend one of our dredgers which we did to facilitate the dredging of the river port. They have said that they need to generate traffic to make the port become commercially viable because some of the activities you need to confirm the volume of cargo that will justify that investment, so that is what is absent.
So one of the things that we could advice, the outcome of this meeting is to make a feasibility study on traffic because the traffic of the volumes of cargo will define whether those ports are viable or not, and in certain instances, we tend to be very ambitious on the port without carrying out studies on the volume of cargo that is needed to justify certain up-down of the port there… so we are quick to put those locations based on political considerations, based on all zonings or whatever it is, we want to say everyone has a port, everybody needs to, without actually doing a study to determine; indeed is there any volume of cargo that can justify an existence of a port square? So these are one of the things that; one is a dredging, two is the volume of cargo and militating against the full operationalization of the port that will facilitate the utilization of inland waters for cargo evacuation.
Just to take us on the dry port which you mentioned, the Kaduna dry port has been so, cargo is destined there but what is important is that it is a destination of choice, a lot of about maybe 70 pecent cargoes that comes is usually consumes ogunle, now they have manufacturing, it is actually where you want to take your cargo to, so a lot of the activities are actually in a cluster… I’m just saying that Shippers council is actually the one that supervises Nigerian dry ports not us which is actually wrong, I have raised that to the minister but they
On Chinese bank loan
… There are certain berths that are in a bad state, we have budgeted for some of them in 2018 and one of the things that we realized is this issue on the devalue of the reconstruction of a berth which has been the budgetary provision.
We have actually made submission to the ministry of transport to get a loan from China Harbor Check, china harbor made a proposal that they will get China Exxon bank to get us a loan at single digit to do a lot of all of these, which includes the berth that we are talking about because we are unable to fully budget for them and do them in totality but know well that we are going to fix it we have not reached that bad level yet.
We actually engage proper construction companies to repair our keys, our jetties where it is required. But the full construction that is needed is something that is huge, the amount is quite large we are seeking to have this loan that will enable us do what is required and to enable us make necessary budgetary for it…
About concession and berth re-designation
The lengths of our berths are wrong, I can say that we have outgrown it, so what we did is that at the point of concession you have berths that are solemn. Now the global berth practice is that vessels are now longer, so those berths are not recognized berths, anytime they come, you can’t have two of those berths. For example, you have a location and you say you have two berths but now your berth maybe one and half or two berths, but in your mind you have one berth.
We have now commissioned the re-designation of the berth, so when we do that it translates into; your concession agreement might said you have two berths, now you have one, your concession agreement might said you have three, now you have one and half or you don’t even have a berth by the time you complete it base on the length it will turn into an entirely different configuration.
But as we have commissioned it and it is on-going, so the outcome of it will form part of the review of the concession agreement because all those berth lengths are no more operational anymore, the length are completely outdated.
So, everybody will say you concessioned and gave me three berths but I have one; what’s going on? So, we will get to resolve that, I know that’s an issue but it also affects our berths’ occupancy rates because we now list that we have 30 berths but those berths are very short length.
So when we review the indices it shows that our berth occupancy rate is very low that’s why it is not so because of the length of our berths. (Vanguard)
