Greek shipowners to sell 40 ships to Nigeria for coastal trade

Greek shipowners to sell 40 ships to Nigeria for coastal trade


Athens: The Nigerian Ship Owners Association (NISA) has signed a memorandum of understanding (MOU) to buy 40 vessels from a consortium of Greek shipowners for use in its cabotage trade.

The vessels will be of various classes and tonnage, and will all be delivered within the next two years, NISA said.

The sale was agreed at a meeting between the two parties held in Lagos, which was attended by Greek owners Constantine Kokkos, Panagiotis Papandopoulus and Dimitris Nomikos, who signed the MOU on behalf of a consortium of shipowners from the country.

Nigeria has founded and will disburse funds from the Cabotage Vessel Financing Fund (CVFF) to domestic shipping companies with which to acquire vessels.

“A total of 600 vessels are operating in oil and gas; and only 10% belongs to Nigerians as at 2015,” said NISA President, Niyi Labinjo, who told press he wishes to grow the country’s domestic fleet to 100 vessels.

Demand for cabotage vessels stems from Nigeria’s Coastal and Inland Shipping (Cabotage) Act 2003, which was instated before the country had a fleet of domestically flagged vessels to put into service.

“To establish a cabotage act before you have a fleet is interesting, that’s one way of putting it,” a source familiar with the matter told today.

Nigerian owners have been trying to buy vessels for employment in coastal trades since the Act was established, the source explained, but international owners have been wary of selling to what they perceive could be unscrupulous buyers in the country.

“The Cabotage Act has done little to build indigenous capacity in shipping,” said Greg Ogbeifun, president of the Shipowners Association of Nigeria (SOAN), speaking at a forum last week. “Our shipowners are largely indebted to banks in a bid to stay in business. This has impacted negatively on the fortunes of seafarers as companies can only engage workers when there are vessels to execute contracts.”

Cooperation with Greece will help Nigeria’s shipowners win business by meeting international safety standards, Patrick Akpobolokemi, director-general of the Nigerian Maritime Administration and Safety Agency (NIMASA), said in a message to the Lagos meeting.

“Some NISA members complained that they are not getting business and when NIMASA investigated we discovered that most of the Nigerian ships could not meet the international standard. The owners of the cargo usually complained that they cannot put their cargo on rickety vessels,” Akpobolokemi said in the message. “ I am happy now that this issue has been resolved. We can now boldly, with NISA, partner with international shipowners, which shows that we are ready for the business.”

Sale and purchase data from show only three recorded sales of vessels from Greek companies to Nigerian buyers since the beginning of 2013.

The last recorded sale was Elsie (11,900 dwt, built 1980), a small clean products tanker sold by Aegean Marine to Nigeria’s Ciaco Industries for an undisclosed price.

In 2014, Palomar Maritime sold its then 34-year-old small clean tanker Merida  (now Radhe) 11,500 dwt, built 1980) to Deep Frontline Shippers Ltd in Nigeria for an unknown price. Also that year, an unnamed Greek seller sold the small CPP tanker

Irene (now Temeteron) 4,700 dwt, built 1991) for the price of $2.15m.

The cooperation between Greek and Nigeria could also include the founding of a shipyard and a maritime college in the African country, Greece’s representative said.

“We will start with building a shipyard and government will assist because we have to create jobs for Nigerians,” Constantine Kokkos said. “We are going to establish a college where we will train Nigerians.”

“Nigeria can make between N3tr to N7tr [between $15bn and $35bn] annually through the maritime industry,” Labinjo told press. “This can also produce five million jobs, compared to aviation which is producing N21bn [$105.5m] annually.”

Nigeria’s president Buhari has formed a National Economic Council, which has prioritised NIMASA and the Nigerian Ports Authority within Nigerian business as a way to provide employment for the country’s young population.