In this report, OLUWAKEMI DAUDA looks at some factors that are responsible for the non-competitive of the ports in relation to ports of neighbouring countries and how to make the ports attractive for business.
LAST week, the Managing Director, Nigerian Ports Authority (NPA) Ms Hadiza Bala-Usman, attributed the reasons the country’s ports are not competitive compared with their counterparts in neighbouring countries: the absence of their deepness with draft of about 17metres.
She said the world has adopted deep seaports. She, however, promised that her management team would work with the new NPA Board to ensure that work on the deepening some seaports were completed.
Also, stakeholders said unstable government policies, lack of safety and security of funds invested by promoters were some of the challenges hindering the development of deep seaport.
Others include comfort of investors, non-provision of measures to ensure continuity, lack of infrastructure and efficient transport system.
Imperativeness of deep seaport
Deep seaports were conceived to improve the cargo handling capacity of the ports and increase Nigeria’s gross domestic product (GDP). The handling capacity of ports in Nigeria is put at 60 million metric tonnes, though demand and use is about 100 million metric tonnes. They are expected to rise with the increasing population, urban expansion and attendant demand for more markets.
The cargo throughput handled in the ports since the ports were concessioned in 2006 has increased geometrically. According to global port development, out of over 100 seaports being built the world over, 75 per cent of these are deep seaports or terminals. The others are mostly inland waterway ports and jetties.
This indicates that the country needs better designed port facilities in tune with increased cargo traffic, for the global competition. Also, emphasis is shifting to larger more economical vessels that require deeper harbour drafts. Global logistics trends have made the need for deep seaports more imperative.
Also, the last two decades have witnessed a major shift in the exploration and production focus of international oil companies (IOCs), with deep offshore frontiers becoming more attractive and widespread. This has naturally affected the dynamics of crude oil carriage, just as more efficient means of petroleum products and liquefied natural gas (LNG) supply and distribution are sought from the downstream segment of the industry.
Crucially, logistics services for these new frontier developments define the core of operations, costs and efficiency, with bigger vessels infinitely more able to leverage scales and further thereto, on costs. The foregoing defines the shipping and oil and gas reality in Nigeria, and paints the canvass for deepwater ports in bold relief.
Stakeholders called on the promoters of the Lekki Deep Seaport in Lagos to address the absence of rail link in the project.
Going by the gigantic nature of the project, the stakeholders are worried that upon completion, the location of the port could become another nightmare in the mold of the Apapa and Tin Can Island ports in Lagos, which have become a hydra-headed problem defying all solutions.
A law teacher at the Lagos State University (LASU), Dr. Dipo Alaka, bemoaned the absence of plans for rail connectivity and use of barges on inland water access to the port, saying these would affect the multi-billion dollar project.
“Go to Apapa and see the huge but avoidable national embarrassment that is going on there. There is congestion in Apapa because those who handed over the ports to the terminal operators failed to plan for the future. There is congestion within and around the Lagos ports because over 95 per cent of our cargo goes on the road. Therefore, both the Lagos State government and the promoters of the Lekki port must ensure that we have a seamless cargo evacuation from the port, if not, it’s laughable to think that we will not have congestion by the time the port becomes operational,” Alaka said.
These fears are not unfounded considering that upon completion, the Ibeju- Lekki-Epe axis will be home to huge traffic arising from the operational activities in the deep seaport and the Dangote Refinery among the other major projects cited in the Lekki Free Trade Zone.
But the Technical Director, Lekki Deep Sea Port, Mr. Steven Heukelom, agreed that the masterplan of the project does not include rail. He however said it was not too late to include same in the project because adjustments were possible in any ongoing project.
The NPA has been under pressure to embark on policy that will lead to the realisation of deep sea port development in the country.
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Doing so, experts said, would impact positively on the cargo handling capacity of the ports and thus increase the country’s GDP.
Experts believe the country needs new and better designed port facilities in line with increased cargo traffic nationally and globally, new and bigger marine vessels that need deeper harbor drafts.
Global logistics practices, they stressed, have made the need for deep seaport more imperative.
“Nigeria needs, at least one port that can berth a Super Panamax Vessel,” said the former General Manager, Public Affairs of NPA, Michael Kayode Ajayi.
He added that one of Nigeria’s deep seaports should become a hub for west and central Africa because of increased maritime and trade volumes of the country.
“The benefits of attaining a regional hub status include the potential to create directly and indirectly, approximately four million jobs over a five-year period and a 70 per cent cut in vessel turnaround time as well as guaranteeing increased revenue from berthing charges to handling charges for the trans-shipment of cargoes. A deep seaport of draft not less than 35 meters will almost guarantee Nigeria the regional hub status, which by volume of cargo alone sent or received from our ports, gives her the right to that status,” Gwandu stated.
Ajayi said Nigeria needed a deep sea facility that load and offload finished, refine liquid, powder and containerised cargo adding that bigger ships move cargo more efficiently than smaller vessels, so the economies of scale make it imperative that shippers will buy new bigger vessels, which have to dock somewhere, a deep sea port.
He said public private partnership (PPP) is best suited for port development because of capital layout required to develop ports and equip same and the broad range of engineering, engineering management and operational management expertise needed.
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