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Business News of Thursday, 25 May 2023


$20m spent annually on vessel repairs - Shipowners

Shipping vessel Shipping vessel

Nigerian shipowners have revealed that they are spending between $15m and $20m each year on repairing their ships abroad, despite the Nigerian Maritime Administration and Safety Agency’s (NIMASA) acquisition of a N50bn floating dock.

Mr Aminu Umar, President of the Nigerian Chamber of Shipping, told our correspondent in Lagos recently that ship repairs have been a major challenge for operators.

Recall that the Nigerian Maritime Administration and Safety Agency 2018 acquired a N50bn modular floating dock, which has been laying fallow at the Nigerian Naval Dockyard, Wilmot Point, Victoria Island, Lagos.

A floating dry dock is one of the five types of dry docks used for ship repairs. It is a submersible platform designed and used to repair vessels.

The government decided at the inception of President, Major General Muhammadu Buhari (retd.) administration to acquire a floating dock to improve the country’s ship repair capacity and transform the maritime industry to generate wealth and jobs.

Umar, who was a former president of the Nigerian Indigenous Shipowners Association, said members of the association took their vessels to some African countries for repairs.

He added that Nigerians owned 80 per cent of vessels repaired in countries such as Senegal, Ghana, and South Africa, among others.

“To be honest, one of the biggest challenges we have as a company is ship repairs. We have a vessel that left dry dock recently and it cost us about $1.5m to $2m to dry dock the vessel for about a month. So, it is very challenging and sad that we do not have enough dry docks. That is why we have many Nigerians taking their vessels to Tema in Ghana, Dakar, Malabu in Equatorial Guinea or Namibia. On the Atlantic side, we have about four dry docks that are good. The first one in West Africa is Dakar. We have Tema, which is currently having some problems, but Nigerians still use it. I have a vessel that will be going to Dakar by next month and another going to South Africa for dry docking.

“In a year, we do a minimum of four to five vessels. So, if you multiply five vessels by $2m, you will see that my company alone spends a minimum of $10m annually for dry docking. In summary, shipowners spend a minimum of $15m to $20m annually on ship repairs in other countries.”

Umar, however, queried the rationale behind the acquisition of the floating dock.

“My advice to NIMASA is to sell the floating dock to the private sector. I cannot see the reason NIMASA that is a regulator will be an operator. It is conflicting. Its responsibility is to regulate the industry. It is regulating dry dock operators, ship operators, including the ports,” he stated.

According to him, if NIMASA is to regulate dry dock operators, how can it be a dry dock operator; it means there is a conflict.

Also, the President of the Shipowners Association of Nigeria, Dr George Onyung, said, “Ships are of different sizes and capacities. They have what is called tonnage. A gross tonnage of 100, 000 is a very big ship while that of 200 is a small ship.

“Most shipyards in Nigeria are of average sizes. They cannot handle bigger vessels. Even NIMASA’s dry dock is limited in capacity to take the kind of ships that we have. It can take like 30 per cent of the type of ships that we have.”

According to him, every ship requires dry docking in a maximum of 2–3 years.

“A tanker in the region of 10,000-30,000 metric tonnes weight will require up to $1m to $1.5m to dry dock,” he explained.

He blamed NIMASA for not making much consultation before purchasing the floating dock.

Onyung asserted, “Not much of consultations was done by NIMASA before the dry dock was purchased and we do not even know where they got the money to purchase the dock.

“My vessels over time have been a small ship less than 10,000 tonnes and the last dry-docking we did in Nigeria cost us about $750, 000.”