NIMASA, NNPC to forge fresh template on crude freighting terms

  • NIMASA Director General, Dr. Bashir Jamoh (right), making a presentation to the Group General Manager, Crude Oil Marketing Division, NNPC, Billy Okoye, during the NNPC team’s courtesy visit to the agency in Lagos…recently

Indigenous operators are set to benefit as fresh efforts are ongoing to change the terms of freighting Nigerian crude oil from Free on Board (FOB) to Cost Insurance and Freight (CIF), to give the country greater gainsfrom its oil resources, the Nigerian Maritime Administration and Safety Agency (NIMASA) has said.

Similarly, the agency was working towards the implementation of a national maritime security strategy to improve security in Nigerian waters and reduce the cost of shipping, according to a statement from the Head of Corporate Communications, Philip Kyanet.

NIMASA Director-General, Dr. Bashir Jamoh, who disclosed this in Lagos when he hosted a delegation from the Nigerian National Petroleum Corporation (NNPC), said “a technical committee involving NIMASA, NNPC and other stakeholders would be set up to develop a template for the desired change, with workable timelines.

Addressing the NNPC team, led by its Group General Manager, Crude Oil Marketing Division, Billy Okoye, Jamoh recalled that “since 2018, NIMASA has championed moves for a change in the terms of trade, with regards to transportation of Nigerian crude oil, from FOB to CIF to ensure greater benefits for the country from its oil resources.”

Under FOB trade terms, Nigeria has no reasonable control over the delivery of its crude oil as regards carriage, insurance and other ancillary services, unlike the CIF arrangement, however, which gives the country ample control over the distribution of its oil, and which can be leveraged to enhance the indigenous operators’ competitive advantage.

He commended the synergy between NNPC and NIMASA, noting that “70 per cent of the agency’s revenue comes through the sale of crude. Thus, cooperation between NNPC and NNPC cannot be over-emphasised.”

He further disclosed that “the Maritime Intelligence Unit recently established by the agency is part of efforts to ensure a proactive approach to security in our waters. The focus is to try to nip maritime attacks in the bud by tracking the criminals from the pre-planning and planning stages.

“The ultimate aim is to develop a national maritime security strategy that would help to minimise the cost of insecurity, which NNPC bears on behalf of the country, in the shipment of Nigerian crude.”

Appealing for more local content in the transportation of crude in line with the Cabotage regime, and praying for continued mutual understanding, he thanked the NNPC for accommodating NIMASA in its processes.

He added: “We do not delay vessels in the search for information on them because of the confidence we have in NNPC’s capacity to readily supply such information.”

Okoye had earlier described NIMASA as a “critical stakeholder in the business of crude oil sale,” stating that his goal was to get the two agencies interfacing more closely to resolve challenges and ensure seamless movement of crude and petroleum products in the country.

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