The Nation Newspaper

Category: Issues

  • BDCs eye $25b Diaspora remittances in new growth plan

    Exchange rate stability is one of the key mandates of the Central Bank of Nigeria (CBN), which has enjoyed the support of the Bureaux De Change (BDCs) in realising the objective. For the Association of Bureaux De Change Operators of Nigeria (ABCON), the success of BDCs goes beyond favourable rates. They need access to multiple streams of forex, including becoming channels through which over $25 billion yearly Diaspora remittances enter the economy. This is expected to deepen the forex market and boost BDCs operations. COLLINS NWEZE reports

     

    For years, there has been moves to diversify the country’s economy away from oil. Besides, crude oil has, for long, remained the mainstay of the economy. Although it accounts for over 80 per cent of Nigeria’s foreign exchange (forex) earnings, the unpredictability of oil prices raises the risk of relying solely on it for the country’s revenue.

    That explains why the country needs multiple streams of forex earnings and the enlisting of more channels to attract Diaspora remittances and other foreign capital that will not only deepen the market but keep the naira stable.

    Diaspora remittances to Nigeria, which was $25 billion in 2018, remain a reliable source of forex to the domestic economy and that is why over 4,500 Central Bank of Nigeria (CBN)-Licenced Bureaux de Change (BDCs) come to mind.

    Concerned with the stagnant state of the economy marred with inconsistent forex earnings through oil export, the Association of Bureaux De Change Operators of Nigeria (ABCON) has called for BDCs to be one of the channels for receiving Diaspora remittances into the economy.

    ABCON President,  Alhaji Aminu Gwadabe, said the CBN forex policy has brought stability to the BDC industry and helped operators to embrace automation, which is the standard best practice globally and adding the BDCs to one of the channels through which the Diaspora remittance funds come into the country will be a good way to reduce the reliance of rate differentials to sustain operators’ businesses.

    He said the BDCs remain at the centre of economic development and have the capacity to attract the needed capital for the development of the economy.

    Findings have also shown that forex remittances from Nigerians in the Diaspora far exceeded the country’s earnings from crude oil export last year.

    Since many transactions are unrecorded or take place through informal channels, the actual amount of remittance flows into the country is arguably higher.

    The estimation is that migrant remittances to Nigeria could grow to $25.5 billion, $29.8 billion and $34.8 billion in 2019, 2021 and 2023.

    For instance,  the total oil earnings of the nation stood at $15 billion in 2018, while the total remittance from Nigerians in Diaspora amounted to $25 billion in the same year. Nigeria earned a total of N5.54 trillion ($15.4 billion) from oil revenue last year, according to the Central Bank of Nigeria (CBN).

    Gwadabe said: “Diaspora remittances contribute to this economy more than what the oil sector is yielding. The Nigeria National Petroleum Corporation (NNPC) inflow in 2018 is about $15 billion while migrant remittances, Diaspora remittances are nothing less than $25 billion annually into this country’s economy, and this inflow is steady and adds to the country’s Gross Domestic Product (GDP).”

    According to him, Diaspora remittances remain cheap source of fund, because it is not to be paid back with interest, but goes directly into the construction of houses, payment of school fees, medicals and a lot of things that are adding value to the weak economy.

    The ABCON chief explained that Diaspora remittances represent household income from foreign economies arising mainly from the temporary or permanent movement of people to those economies.

    The remittances, he said, are cash and non-cash items, that flow through formal channels, such as electronic wire, or through informal channels, such as money or goods carried across borders, adding that Nigeria can cover a large part of capital flow gaps through remittances from its citizens in diaspora using the BDCs.

    “Nigerian BDCs operators have also identified with the immense opportunities presented by Diaspora remittances and want to play greater role in attracting more foreign capital into the economy.

    The reason being that remittances are known to help poorer recipients meet basic needs, fund cash and non-cash investments, finance education, foster new businesses, service debt and essentially, drive economic growth,” Gwadabe said.

    He said Nigerian BDCs, like their counterparts in other emerging or developing economies,  can deepen the forex market through remittances and collections.

    “When that happens, it will not be the first time that BDCs were given the opportunity to turn the remittances market around for good.

    In India, the BDCs generate over $30 billion from the Diaspora remittances. In United Arab Emirates, the entire banking needs of banks are met by the BDCs.

    The working of the Lebanese economy is highly dependent on the activities of BDCs in that country. Therefore, Nigeria can also achieve higher revenue through BDCs given the opportunities we seen in the remittances market,” he said.

    He regretted that the cost of sending money from the Diaspora to Africa was rising. In the first quarter of 2018, the average cost of sending $200 was 7.1 per cent, and remittance services in Sub-Saharan Africa were the costliest in the world at an average cost of 9.4 per cent.

    He insisted that renegotiating exclusive partnerships and letting new players operate through national post offices, banks, BDCs, and telecommunications companies would increase competition and lower remittance prices.

     

    ABCON’s position on N305/$ exchange rate

    The ABCON has also defended CBN policy on foreign exchange allocation to BDCs, which it believes has stabilised the naira against the dollar.

    Gwadabe faulted the petition against the CBN Governor, Godwin Emefiele and its management team over the deployment of dual exchange rate regime in forex allocation.

    He also faulted the N305/$ rate to BDCs as proposed by the petitioner, saying it is not a transactional rate but that is used for settling government obligations.

    Senate Committee on Finance had invited CBN Governor Emefiele to appear before it on February 7, 2020, following a petition by human rights activist, J. U. Ayogu, who accused the CBN Governor and its management team of compromise in the allocation of foreign exchange.

    “There is a case against the CBN Governor and his management team written by J.U. Ayogu. A petition before the Senate laid on the Senate on the December 12, 2019, where J. U. Ayogu, Esq, on behalf of the Bureaux De Change Operators of Nigeria wrote against the CBN over its dual exchange rate forex policy that enriches few Nigerians and its top management staff to the detriment of many lawful Nigerians.

    It is  frustrating the present administration to eradicate poverty and unemployment from all the nooks and crannies of Nigeria,” Member, Senate Committee on Finance, Senator Ayo Akinyelure (PDP, Ondo Central), said.

    The petitioner had pleaded with the Senate to compel Emefiele to review the policy of dual exchange rate without delay to keep BDC operators in business.

    But ABCON management said the CBN forex policy has brought stability to the BDC industry and helped operators to embrace automation which is the standard best practice globally.

    “This is the hand work of unknown faces not ABCON. It is confrontational and lack credible evidence. The N305/$ is not a transactional rate but it is one for settling government obligations. ABCON submission to the National Assembly is on Value Added Tax (VAT) exemption and review of licence fee renewal downward submitted to the CBN. The petitioner was never at any time appointed to speak on behalf of BDCs,” Gwadabe said.

    Read Also: CBN urged to raise forex restriction list over current account

     

    He disclosed that no BDC or service provider gets forex at N305 to dollar and that the petitioner’s claim is completely false.

     

    VAT consultant steps in

    Gwadabe said ABCON has appointed Mike Akinfolarin & Associates as its consultant/tax attorneys on VAT, which is a bigger problem confronting operators as a large part of their income go into paying taxes, adding that in other economies, forex rate control by government is VAT exempt.  “That the law firm of Mike Akinfolarin &Associates (Tax Attorneys) made a representation on behalf of ABCON before the  National Assembly public hearing,  House Committee on Finance Bill  on November 25, 2019 in Abuja. And that remains the position of ABCON,” he said.

    He commended the CBN management for its progressive policies and achieving stable exchange rate that aligns with its price stability mandate and reducing unemployment in the country.

    Also, the West African Institute for Financial and Economic Management (WAIFEM) Director-General, Dr. Baba Musa, explained that in economics, Diaspora remittances are called non-debt creating flow, which comes in like Foreign Direct Investment (FDI).

    He said Diaspora remittances remain crucial in economic development, but there was need to look at how they are coming in. He said  the source of many of the funds is never known, hence the need to broaden the remittance channels.

     

    Connecting BDCs to remittance business

    Financial pundits have continued to give reasons BDCs should be brought into the Diaspora remittance business. For instance, financial institutions’ long procedures, complicated forms, and history of poor service quality means BDCs are needed to deepen the market. The BDCs segment of the market operates in a simple manner while remaining closer to the people needing the remittance funds.

    “BDCs buy foreign currency from remittance recipients and sell it to Nigerians who want to travel abroad. The reason for establishing these institutions in 1989 was to broaden the forex market and improve accessibility to hard currency.

    The CBN supervises and issues operational guidelines for BDCs. In March 2006, Nigeria licensed 293  BDCs, which have risen to over 4,500 operators today. This development means that BDCs are willing and ready to do the remittance business,” Gwadabe said.

    He explained that money senders want their beneficiaries to get a favorable exchange rate and more value in the local currency and such can only be achieved in a competitive market where recipients have several options including BDCs.

    Gwadabe said  a coherent policy framework to harness remittances into generating capital for productive investments for the growth and development of small and micro-enterprises, which will in turn, create employment was required. In addition, remittances can be deployed toward philanthropic activities which can serve as solutions for specific deficiencies in the local infrastructure such as schools, hospitals and roads.

    For him,  remittances are on track to become the largest source of external financing in developing countries and Nigeria cannot be left behind.

     

  • A busy year, says Tecno

    By LUCAS AJANAKU

     

    It has been quite a busy year for Tecno as the original equipment manufacturer (OEM) tried to balance profit with corporate social responsibility, it said in a statement.

    According to the statement, the smartphone brand set out at the beginning of the year to touch lives and make it evident that the brand is one that cares for it host country.

    “As the year ends, Tecno has accomplished all we promised to do, especially in the CSR department. We have differentiated our brand in more ways than one.

    “In 2014, Tecno started a children-centered CSR initiative that has seen to ensuring that many children from public primary schools across Nigeria win scholarships and many other prizes.

    Read Also: Huawei gets award for digital economy promotion

     

    “In line with that initiative, the theme on Children’s Day this year was: Give the Nigerian Child A Future. In the Lagos region, five schools were selected to participate. After an examination to select the best students, scholarships were awarded to five students from each of the schools through the Tecno Foundation,” it said.

    According to the OEM, there was also a Children’s Day Party that brought children from over 30 public schools together with plenty of fun and games plus numerous gifts.

    “Tecno  got involved in another Get-a-Nigerian-through-school project called AcadaFest Scholarship 2019. Through this initiative, Tecno sponsored three deserving students for the duration of their university education,” it said.

     

     

  • NCC hunts for innovators

    By LUCAS AJANAKU

     

    The Nigerian Communications Commission (NCC) said it has started the hunt for youthful innovators in the information communication tecghnology (ICT) sector to provide hochtonous solutions and create jobs.

    Its Executive Vice Chairman/CEO, Prof Garba Dambatta, who spoke at Digital Bridge Institute (DBI), Oshodi, Lagos, during the maiden edition of NCC ICT Research and Innovation Competition/ Exhibition, said the ICT sector has become a key driver of digital transformation and digital economy globally.

    The theme of the forum was: Promoting innovation and creativity in the telecoms sector.

    He said: “ICT innovation has been established as a veritable engine for sustainable economic growth and global competitiveness.

    Today, digital technology is proving to be a positive disruptor, enabling emerging economies to create wealth and implement life changing digital solutions to societal challenges, through ICT innovation.

    “Nigeria is not left out in the emerging technology race.The Federal Government has recently adopted a digital economic framework that will fast rack the country’s agenda to tap from the enormous potential of the fourth industrial revolution.

    The NCC as a regulator, appreciates the fact that the ICT industry stands at the epicentre of this initiative, hence we have positioned ourselves to deliver on our mandate to facilitate the development of the core pillars of digital infrastructure, digital platforms, digital skills acquisition, digital entrepreneurship etc.

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    “We also appreciate the fact that the rapidly evolving communication technologies could become a means of bridging the digital divide and achieving the digital economy agenda, while ensuring ubiquitous connectivity and providing consumers with a plethora of services that could change our economic lives for the better.

    Dambatta said it is in the light of this development that the NCC, consistent with its eight-point agenda to promote ICT Innovations and investment opportunities in the  economy, has designed the ICT Research & Innovation Competition/Exhibition as a strategy to advance the promotion of tech entrepreneurship and facilitating innovation and creativity in the ICT sector.

    “We are interested in ideas that are novel/original, commercially viable and that can proffer solutions to business and social challenges in our country.

    We also commit ourselves to regulatory efforts towards ensuring that the selected ideas are incubated and handheld to the point of commercialisation,” Prof Dambatta said.

  • Haastrup makes case for women in maritime

    by Muyiwa Lucas

     

    The Chairman, Seaport Terminal Operators Association of Nigeria (STOAN), Princess Vicky Haastrup, has canvassed more women participation in the shipping sector to reduce the gender gap in the industry.

    Although she acknowledged that there has been improvement in the level of women participation in the sector as against what obtained a decade ago, she said there was still need for improvement, especially in seafaring and freight forwarding.

    Haastrup this known while being conferred an award as the Women International Shipping and Trading Association (WISTA) Nigeria Personality of the Year.

    “For example, in freight forwarding sub-sector and seafaring, we don’t have too many women. So, we want to see more participation in that aspect. If we have more women, that part of the sector will be better modernised because people always have more confidence in women and the industry will be better for it.

    “Those of us who have been in the industry should encourage the younger women and support them within the area we operate. Some of them don’t have the financial capacity to operate. That is one of the ways we can encourage them.

    “I am happy with the level of participation because the awareness is there and people are getting sensitised about the importance of women participation in the sector. We are getting there, but we are not there yet,” she said.

    In her goodwill message, the Managing Director, Nigerian Ports Authority (NPA), Hadiza Bala-Usman, also urged more women to participate in the sector.

    Usman, who was represented by the General Manager, Managing Director’s office, Dr Chinwe Abama, said that pursuing gender balance would enable women get fair advancement that is commensurate with their qualifications and experience.

    Read Also: Oguta seaport complex rots

    Bala-Usman said women were not asking for equality in terms of power with men but that they were calling for equal opportunities as they are endowed with special qualities, adding that institutions with more women leaders have better performance and achieve higher economic growth.

    “When a woman is empowered, you are invariably empowering a whole generation that will benefit from the quality of leadership that is exceptional and unique to women.

    “Emphasis should be laid on innovation by enabling women discover themselves, build personal and corporate brands, identity that differentiate them in society, making them not only unique and authentic but visible to rise into the role of leadership and influential position,”Bala-Usman said.

    Earlier in her address, the President of WISTA Nigeria, Mary Hamman, urged women to come out of their shells.

    She said most aspects of shipping have been computerised, so they could stay in their homes and participate in the industry.

    Maritime lawyer, Emeka Akabogu, in his lead paper, noted that while there is gender gap in the industry, women who aspire to take up leadership positions must be willing to face the challenges that would come with equal opportunities with their male counterparts.

     

  • Expert warns against CVFF disbursement

    by Muyiwa Lucas

     

    Ahead of the planned disbursement of the Cabotage Vessel Financing Fund (CVFF) to indigenous ship owners in the first quarter of 2020, a marine stakeholder, Emmanuel Ilori, an engineer, has advised the Federal Government not to disburse the Fund as being mooted.

    Rather, he wants the fund used to establish a maritime development bank.

    Ilori argued that the fund would not give the expected value if disbursed.

    “Disbursing the fund to individuals would barely purchase a reasonable number of vessels and then there would be the issue of who to consider in the sharing.

    CVFF is a good source of funding. But, how many vessels will $200 million buy? Who will benefit from that purchase? How are we going to use that $200 million to develop the maritime industry? It is capital intensive,” Ilori said.

    He said many areas of the sector that required funding, asking: ‘’Once the $200 million is depleted, what happens?’’

    He said this necessitated the new position on how best to invest the $200 million so that it could grow. ”One of the areas is to set up a maritime development bank, and use the fund as seed money to develop the industry so that people who have sound bankable maritime businesses can access the fund,” he said.

    He contended that a maritime development bank give loans to investors to upgrade shipyards, where specific crafts could be built, thus creating more jobs opportunities.

    “So, we will not only be developing ship purchase, the need for us to invest in ship repair, then, other areas of need that we can develop the industry instead of dishing out the money to a few lucky people.

    Read Also: Reviewing navy’s maritime security efforts

     

    “That is the area we need to look out for, because we are not the only nation that has developed its industry using the maritime development bank route. So, it is something we need to look at again and say how we use that fund constructively to develop the industry.

    “And I don’t think sharing it among a few people is the best way. I think the Minister raised this in the past that he is not inclined to share the money among people. Let us talk of the Ship Acquisition Fund of the past given to people. How were they able to recover it?  It went down the drain.’’

    He further argued that a maritime development bank would drive investment interests, making it less difficult to have ship-building companies to set up in Nigeria.

    “What sort of ships do we need within the Nigerian waters? If we can determine the vessel needs of Nigeria, you can then use that fund though a development arrangement, to say we will invest this money in developing; so number of vessels to be built in Nigeria, invite the ship building company to come and set up in Nigeria. These are the number of  vessels that we need for trade in our waters, “ he said.

    “That is why we are saying we need to revisit the issue of access to funding. That is why we are advocating that if you use the CVFF as the seed money for the maritime development bank where people can access fund at a very low rate, it will not only attract local investors, it will attract foreigners investors to invest in Nigeria,” he added.

     

  • Congestion: Stakeholders call for vessel diversion

    The congestion at  the seaports has led to stakeholders calling for the utilisation of lesser ports. However, owing to the state of such ports, this call, laudable as it is, may not be actualised at the moment. But the Federal Government, through the Nigeria Ports Authority (NPA), says it is working hard to make the ports become more efficient, MUYIWA LUCAS reports.

     

    THE Association of Nigeria Licensed Customs Agents (ANLCA)  has reiterated the need for ships on Lagos, Port Harcourt and Onne anchorages waiting to berth, to be diverted to other ports.

    ANLCA’s National President, Tony Nwabunnike, who made the call, said the situation is attracting trucks and other heavy duty vehicles to these areas, which unfortunately, lack infrastructural capacity to cater for this development,

    This reason, he further revealed, has not only hampered free movement of cargo laden trucks, but also impacting adversely on the ongoing port access road construction. He regretted that in addition to causing loss of revenue to the government, the situation has the capacity to create unemployment and slow national economic growth.

    “We hereby call on President Muhammadu Buhari to direct that ships waiting at the Lagos and Port Harcourt anchorages be diverted within three months to ports in Warri, Delta State and Calabar, Cross River State. Nigeria-bound cargoes are being diverted to Duala Port Cameroun due to the long waiting periods and cargo owners desire for quick turnaround time for vessels,” Nwabunike said.

    According to the ANLCA boss, such diversion will not only support the government’s Ease of Doing Business objective but will also reduce the number of trucks on some port’s access roads and allow speedy execution of the ongoing construction along the corridor.

    Besides, he added, it would also help in averting avoidable congestion with adverse effects in Lagos and Port Harcourt ports.

    He warned that this measure required some urgency before the next rainy season when construction might be slowed down. Shippers and cargo owners, he explained, were conscious about ships turnaround time and would likely embrace opportunities for quicker discharge of cargoes.

    “It will also make for even distribution of maritime trade among cities where ports are domiciled while opening the economy to fresh business opportunities,” Nwabunnike said.

    To this end, the ports of Warri in Delta State and that of Calabar in Cross River State, are believed to bring relief to this problem if they are made efficient.

    Read Also: Congestion: Truck drivers accuse Navy of sabotage

     

    But this call may not materialise in the shortest time being appealed for by the freight forwarders. At a meeting with members of the House of Representatives Ad-hoc Committee on Ports and Harbours recently, the Managing Director of Nigerian Ports Authority (NPA) Hadiza Bala-Usman, had explained that three key reasons were responsible  for vessels’ avoidance of Warri,among others.

    These, she  said, include insecurity, poor access roads and lack of rail linkages as well as shallow drafts of the channels. The shallow draft of the channels, she explained, hinders the infrastructure capacity of the Port Harcourt port. This is based on the approval of the contract for this by the Federal Executive Council (FEC) last year.

    Besides, Onne Port is functioning at full capacity, while the NPA management is said to be working with relevant stakeholders to address the challenges in this area towards having a more robust port operation.

    To address the issue of port access roads, Hadiza Bala-Usman explained that the NPA has drawn a basket of such roads across the country and written to the Federal Ministry of Works and Housing about the need to prioritise the rehabilitation of these roads.

  • Tackling indigenous pilots unemployment

    Many young pilots who graduated from the Nigerian College of Aviation Technology (NCAT), Zaria, Kaduna State and other flying schools are roaming the streets in search of a place in the cockpit. They are unable to get jobs because of insufficient flying hours and rating on various aircraft types. To reverse the trend, the college has introduced a programme to bridge the gap amid other interventions, writes KELVIN OSA OKUNBOR

     

    Securing a job as a young pilot in Nigeria is becoming  difficult. Reason: Scheduled carriers need pilots with hundreds of flying hours, before they could be employed.

    Besides, the prescribed flying hours, which differ from airline to airline, such young pilots need to be type-rated in flying various aircraft.

    Type rating is training that confers proficiency on the pilot in flying categories of aircraft, according to the number of engines and series.

    Global regulatory requirements prescribe that a pilot be rated to fly either a Boeing, an Airbus, a Bombardier, and an Embraer aircraft.

    While young pilot graduates in Nigeria are struggling to meet the stiff conditions set by indigenous carriers to secure a place in the cockpit, global demand for pilots is becoming unprecedented.

    According to United States (US) aircraft manufacturer, Boeing, the global aviation industry will require about 804,000 new civil aviation pilots. The company said this figure is based on the growing aircraft fleet needed to service commercial, business and other aspects of aviation.

    The  demand, Boeing Chief Executive Officer, Dennis Muilenburg,  said would stem from a mix of fleet growth. Meeting this strong demand, experts said, would require a collective effort from across the global aviation industry.

    To achieve the demand for global pilots, experts said there is the need to adopt innovative training to enable optimum learning and knowledge retention.

    But the rising  unemployment rate among indigenous pilots has not deterred more people from pursuing a career in flying at either the Nigerian College of Technology (NCAT), International Aviation College (IAC), Ilorin, Kwara State and other flying schools across South Africa, US and Europe.

    Upon  graduation, reality often hit  young pilots as airlines in Nigeria are reluctant to create opportunities for them to practise because studies at the training colleges do not confer on them sufficient flying hours to take command of flights in the cockpit.

    In Nigeria, the 18-month course at either NCAT or the IAC only allows the student pilot accumulate a paltry 250 flying hours, far below the 1,500 hours many scheduled carriers need as minimum requirement for the engagement of young pilots.

    But globally, this is different. Statistics from global bodies indicate that Asia carriers alone forecast to hire up to 266,000 new pilots between 2019 and 2038.

    The increase in demand for new pilots, according to global bodies, is predicated on the expected rise of yearly growth rate of 3.9 per cent in the next 20 years.

    In an interview, Chief Executive Officer and Rector of NCAT, Captain Abdulsalami Mohammed, said many professionals were getting worried over the increasing rate of young pilots unemployment in Nigeria and were thinking out of the box in proffering solutions to the lingering headache.

    Mohammed said the college was   worried about the inability of its young pilots  to secure jobs in scheduled carriers because of inadequate flying hours.

    He said many carriers peg minimum of 1500 flying hours as requirement to engage young pilots because of insurance and other considerations.

    Besides crossing the hurdle of flying hours, the rector said the college has introduced multi-engine type rating course for young pilots to prepare them both for local and global employment opportunities.

    Mohammed said: “I am very concerned about employment for graduates and not only pilots and the issue is not about type-rating, but the experience.

    Even when some of them come back from America, they still don’t get jobs because they have not gathered the necessary hours. Different airlines have different requirements.

    “Most of the airlines require a certain minimum of hours for insurance purposes before you can fly their aircraft. So, these pilots before they are employable need to build up these hours.

     

    “This is where the General Aviation comes in because they don’t have these requirements. So, we encourage the young pilots to go into General Aviation. That is the practice worldwide. If they are able to build more hours, that will make them marketable and employable.”

     

    He said the college has worked out a programme for multi-engine type rating to enhance job opportunities for pilots.

    He said: “As you know, when a pilot graduates from school, he comes out with a basic commercial pilot licence  and then with the type on the aircraft that he used for training.

    “So, when he comes out and gets a job anywhere, if they are operating that kind of an aircraft he trained on, he doesn’t need additional training, but if it is in any other aircraft that is different, he must undergo type-rating training regardless of the size of the aircraft.

    So, you can imagine the number of training facility that you will need. For the bigger commercial aircraft, most of the training is done on simulators for cost effectiveness.

    “We call them complex aircraft. When you fly complex aircraft, some of the maneuvres and the emergencies that you have to be trained on cannot be carried out on actual aircraft.

    You can only do them on simulators. That is why you have to go to where they have simulators. For each aircraft type, there is a simulator that is providing this training.

    “At NCAT, we recognised this gap and that was why we embarked on the acquisition of the Boeing 737 New Generation  simulator. That is the type that Arik Air operates.

    We envisaged that the Boeing 737 Classics are on their way out. That is why we decided to go for the New Generation. This project would have been completed a long time ago.

    “The initial process was to site the simulator in Lagos, but when this administration came into power in 2015, the decision was changed to site it in Zaria, Kaduna State,  and there was no provision for the building that will accommodate this simulator. We looked at the possibility of using existing structures, but they are not suitable.

    “So, we had to start afresh by getting consultants that will design the building, we had to go through full procurement, selecting contractors. We awarded that contract last year and the building as we speak is about 60 per cent completed.

    The structure is completed. We are only doing internal wiring, painting and stuff like that. That simulator we hope would be delivered to the college within the first quarter of 2020.

    “When we have that simulator installed, we will be able to offer type-rating courses on that Boeing 737New Generation .

    Now, as part of our plans for the future, we also made provision for a second simulator. So, if you go to the building, you will see that we have two simulator bases.

    “We intend to install a second simulator. We are watching the industry to see if the national carrier comes; the type of equipment they are going to use will guide us on the type of simulator to install.

    Once we have the national carrier, NCAT will play a big role in training a lot of the personnel.”

    Last week in Lagos, the Managing Director Aero Contractors, Captain Ado Sanusi said collaboration between airliners and aviation training institutions would  assist to reduce indigenous pilots unemployment as some carriers are making their facilities available for further training of pilots to accumulate flying hours.

    Sanusi explained: “In developed countries, if you finish with 250 hours, you don’t go to airlines; you go to flying school till you get 1,500 hours before you start coming to fly for airlines.

    “It is when you get Airline Pilot Licence (APL) that you fly for an airline. But, we take them with commercial pilot licence, with very low hours. We train them or let us say they even train themselves. They come to us with very low hours, 250 hours and 300 hours.

    Read Also: Aviation: Bridging gender imbalance

     

    ”Taking a trainee pilot with that number of hours will increase the airline’s insurance premium because the airline is using inexperienced and low time co-pilot.

    The increasing insurance premium will put a lot of stress on the aircraft because they are going to be doing training and everything. And when the pilot becomes proficient, then he now says I am paying him small remuneration and he leaves.

    ”When you come in with low flying hours, you pay the airline to gain up to 500 and 1000 hours on the type of the aircraft. But now, I am bringing you in, giving you this training on the aircraft, giving you the opportunity to have this experience, without any government incentive to the airline and I am a privately owned company, I am doing business purely on profit basis; I am not doing it on charity.

    ”Then after you have been trained and I have paid a high insurance premium; after I have suffered a lot on my landing gear because of hard landings that pilots do while training; after I have suffered all that expense in maintenance of the aircraft and other expenses, you now say, I am paying you a little, so, you want to leave me and go to another airline.”

    Aviation security consultant and Secretary-General of the Aviation Safety Round Table Initiative Group Capt. John Ojikutu (rtd) called on indigenous carriers to absorb young pilots.

    He said: “The onus is on the airlines; if we really want to have more Nigerian pilots, they should absorb them. But to absorb them most times, the airlines ask them to go for type-rating with their money and where will many of them get between $100,000 and $200,000 for that from? These are people who are looking for jobs.”

    Meanwhile, Captain Mohammed said NCAT has embarked on many projects that will enhance its training capabilities.

    He said the college will increase its fleet of trainer aircraft to enhance its training capabilities.

    Mohammed said acquiring more trainer aircraft will create a window for its young pilots to acquire more flying hours to prepare them for the job market.

    The rector said: “The whole idea of getting more training aircraft is that it will greatly enhance our training capacity. By breaking down the aircraft orders into batches until the twenty target is achieved is part of strategy to equip the college for efficiency.”

    Mohammed said the setting up of a national carrier has a huge role to play in resolving the challenge of young pilots unemployment.

    The rector said: “There is need for domestic carriers to work together and support every initiative that will make them stronger to absorb young pilot graduates. Besides, I believe there is need for Nigeria to have a national carrier. Such airline will have training capacities for our young pilots to enhance their professional growth.”

  • Firms, NLNG deepen knowledge in oil, gas

    Our Reporter

     

    Global law firm Hogan Lovells has collaborated with Aluko & Oyebode, Lagos Chamber of Commerce International Arbitration Centre (LACIAC) , Legal Division, the Nigeria Liquefied Natural Gas Limited (NLNG) to organise a two-day training session for some workers of NLNG.

    The training took place at the NLNG premises on Bonny Island, Rivers State. It was an opportunity for participants to engage in constructive and interactive sessions with legal experts.

    The panel of speakers included Hogan Lovells’ London-based partners Nathan Searle, Angus Rankin, and Hogan Lovells International Arbitration lawyer Dr. Ademola Bamgbose; Babatunde Fagbohunlu, SAN, Construction Law and Arbitration lawyer Ngo-Martins Okonmah, Dare Senbore of Aluko & Oyebode; and Funmi Iyayi Managing Director, LACIAC.

    The discussions revolved around the management of legal risk, international business disputes particularly with regard to Engineering, Procurement and Construction (EPC) contracts in the oil and gas sector.

    It also included an overview of the governing laws of the industry and challenges experienced by arbitration practitioners in the Nigerian context.

    The session provided a platform for participants to discuss global best legal practices and trends as well as explore the issues and opportunities across the liquefied natural gas (LNG) sector in Nigeria.

    Hogan Lovells partner, Nathan Searle, expressed confidence in Nigeria’s oil and gas industry and said it has a strong future.

    Acknowledging that Nigeria has one of the largest gas reserves in the world, with NLNG being the fifth largest  producer of LNG in the world, Searle said there is a need to further harness the sector’s potential by continuing to build on existing knowledge through trainings like these.

    “NLNG is growing in Africa and looking at Nigeria over the past decade. It has had a significant number of international transactions despite difficult market conditions.

    This has given the industry a strong profile internationally. Through this training, we shared global best practices and solutions that can lead to the sustainable growth of Nigeria’s oil and gas sector; and we are glad to be amongst the thought leaders that shape the way this sector addresses key issues going forward,” Searle said.

    “Discussions such as these provide an opportunity for the industry to focus on processes that will lead to generating increased value.

    We look forward to hosting more engagements like this across various sectors with other leading players in the African market,” he added.

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    Babatunde Fagbohunlu, SAN, Aluko & Oyebode senior partner said: “Large scale projects in the oil and gas sector carry risks and it is important that such risks are properly managed.

    Discussing how to manage such risks at an early stage from both a legal and commercial perspective is critical to minimising disruption to the business and loss of value.

    Training programmes such as this, which bring together legal experts and those working directly in industry to share their experience and insights on managing risks is the right step towards consolidating and building on best practice in the oil and gas sector in Nigeria.”

    The convener of the symposium, Managing Director, LACIAC, Funmi Iyayi, reiterated the body’s efforts towards providing tailored dispute management solutions and assisting businesses not only in the resolution but in the management of disputes through partnerships with local and global thought leaders.

    LACIAC sees an increasing role for arbitration under its rules to be included in contracts including the Nigerian oil and gas and construction sectors to provide for efficient, cost-effective and local dispute resolution of disputes that may arise during a project.

  • Ihedioha backs SPDC’s gas project in Imo State

    Our Reporter

     

    Imo State Governor Emeka Ihedioha  has pledged the support of the government and people of the state for the success of the multibillion dollar Assa North/Ohaji South Gas development project.

    Ihedioha spoke during a visit to him in his office by the leadership of the Shell Petroleum Development Company (SPDC). He said: “We are determined to work with Shell to build the plant and help Imo State fulfill its quota to the nation’s domestic gas aspiration.

    We are dedicated to making life meaningful for our people and to making Imo State investor-friendly. Imo State shall partner with you.

    We have a civilised state and our hands are wide open to welcome Shell back to its original home in Nigeria.”

    SPDC’s Managing Director and Country Chair, Shell Companies in Nigeria, Osagie Okunbor, who led the SPDC delegation, described the gas project in the state as the company’s “most important project right now” adding, “We are committed to making the Assa North Gas Project an exemplary one.”

    The project, according to Okunbor, is key to driving the Federal Government’s ambition of marching away from a mono-economy through diverse industrial growth.

    Read Also: Petroleum minister commits to sector’s growth

     

    “It is premier among the Seven Critical Gas Projects initiative led by the Ministry of Petroleum and the Nigerian National Petroleum Corporation (NNPC).”

    The Assa North/Ohaji South gas project is a joint venture project involving SPDC, Nigeria National Petroleum Corporation (NNPC), Total E&P Nigeria Limited (TEPNL), Nigerian Agip Oil Company (NAOC) and SEPLAT, a leading indigenous producer.

    SPDC is expected to manage the upstream operations to produce 600 million standard cubic feet of gas per day, half of which will be processed at a new SPDC JV processing plant and the remaining half sent to SEPLAT for processing at the company’s new gas processing plant.

    The combined volume translates to almost 2,400 megawatts (Mw) of potential electricity generation if used for power generation.

    At the meeting with the governor were the deputy governor, Gerald Iroha; Chairman of Imo State Oil and Gas Committee, John Ottih; and SPDC’s Directors – Toyin Olagunju and Igo Weli.

  • Digitalisation, new technologies to drive petroleum industry

    As global energy consumption continues to increase, operators of the oil and gas industry are increasingly exploring ways to expand production to meet the growing demand. Application of digitalisation and emerging new technologies, according to the industry will make expansion of production, reports CLINTON OBETO.

     

    Since the 1970s, the petroleum industry has served as a major source of income to Nigeria’s economy.  Also, due to the advancement, growth and diversity of the world, the need to create new sources of energy to serve the growing demand becomes imperative.

    It is in view of this that the petroleum industry seeks to broaden production. It has also led the petroleum industry turn to digitalisation, innovative ideas and new emerging technologies that would increase performance, efficiency and ultimately reduce cost.

    New technological breakthroughs in the area of digitalisation now make it possible for oil and gas companies to operate efficiently, improve gains and reduce cost.

    The need for wide application of the new emerging technologies by oil and gas operators took centre stage the 2017 and 37th annual international conference of the Nigerian Association of Petroleum Explorationists (NAPE) with the theme ‘Expanding Nigeria’s Petroleum landscape: Digitalization, innovation and emerging new technologies.”

    The immediate past President of NAPE, Mr. Ajibola Oyebamiji, discussed the influence of digitalisation and emerging new technologies to the oil industry and how it is helping the industry’s current operations and opening up opportunities for new business models.

    Read Also: Mandilas, NNPC open service centre in Abuja

     

    He stated that with cloud competing in digitalisation, operators are able to solve, process and manage large bundle of data, and it also enables the gathering of large volume of data, sorting it properly and making an advanced analysis. This enables experts make decent forecast and define gaps in business models.

    Currently, Internet of things (IoT) is helping to capture and transmit data from free roles and remote location enabling decision making, uploading, monitoring of well site equipment, reduction of operation costs, detection of gaps and anomalies in the petroleum industry.

    It also helps to analyse and visualise data into different platforms as well as secure use of equipment and facilities and helping to avoid future equipment failure or potential security issues.

    Also, sensor technology aids companies track and gather data, track equipment usage and maintenance, which helps to boost operations and optimise production.

    Through digital transformation, it is possible to create a work environment, create business advantages and boost personnel resolution  because it is widely accessible and usable.

    “The petroleum industry has always been in the forefront of developing technology to support her objectives, growing from 2D to 3D and 4D technologies.

    The industry is developing and moving on new and existing technologies to continue to ensure the world’s energy needs are being met safely, sustainably and competently through the best of means.

    He noted the importance of government, policy makers and stakeholders to have the knowledge of how technological changes can be deployed and sustained as key driver in guaranteeing energy security and diversification especially in Nigeria.

    The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kolo  Kyari, who was the keynote speaker at this year’s annual international conference held in Lagos, said it was innovation and new technologies that led to the recent discovery of oil in Kolmani Well 2 in the Gongola Basin.

    The discovery remained the biggest indication that modern technology helps in accelerating oil find. He said for over 35 years, the industry could not find oil in the frontier basin but with the deployment of latest technology and innovation using the best and latest  digital solutions, the NNPC was able to strike oil in that region.