DANGOTE REFINERY: Nigerian Shipowners Apprehensive, Foreigners to Take Over Local Distribution of Fuel

Barr Temisan Omatseye, former Director General of NIMASA


Even as President Muhammadu Buhari sets to commission the 650,000 per day Dangote Refinery on Monday 22nd, May 2023, Nigerian shipowners have said that the refinery would not have any significant improvement on the fortunes of the local shipping players.

Former Director General of Nigerian Maritime Administration and Safety Agency (NIMASA) and Pioneer President of African Shipowners Association, Barr Temisan Omatseye stated this while fielding questions from journalists on the sidelines of the 5th edition of the Taiwo Afolabi Annual Maritime (TAAM) Conference in University of Lagos (UNILAG) on Friday.

Omatseye said that local shipowners have no stake in the fortunes that the Dangote Refinery would bring to the nation because they don’t have the required vessels.

According to him, most of the vessels that would be operating local distribution of products from the refinery are foreign owned.

“Even if Dangote is commissioned tomorrow and kicks off, they cannot evacuate the product, they don’t have the infrastructure, so it is only by ships that product would be transported, so the same foreign ships that are charging us $50,000 per day from Lagos to Calabar would be used

“Dangote Refinery is going to be producing 650,000 barrels per day, this is not small product, if you go to Lekki now, we have Pinnacle tank farm, everytime they bring in a vessel, the trailer waiting time is 3 to 5 kilometers long, now that someone is bringing 650,000 barrels per day, what trailers are you going to use?

“Our logistics distribution for petroleum products is based on coastal shipping, when Port Harcourt refinery was working, vessels come in from Port Harcourt to discharge product at Lagos Atlas Cove, there is no product pipeline that links these areas to Lagos, the only way to bring products to Lagos is by waterways

“The only way Dangote can evacuate it’s products is by water and the same foreign shipowners have dominated that space

“Basically, if we must compete, we need to be loading an LR1 or LR2 which is minimum of 72,000 tonner vessel for maybe three times a day, which Nigerian Shipowners has that kind of vessel?

Omatseye condemned the fact that the Cabotage Vessel Financing Fund (CVFF) domiciled under NIMASA to assist local shipowners procure vessels have not been disbursed for the past 19 years.

According to him, the recent call for auditing of the CVFF account by the National Assembly is a welcomed development, even as he doubted that fund could still remain at the $350million claimed by current management of NIMASA.

He wondered that the 3 percent collection from offshore supply boats, tankers and all vessels coming to Nigeria for the past 18 to 19 years could not have remained at that sum.

“What the National Assembly is doing is right. First of all, we need to know how much is there in the CVFF.

“We have been collecting this money for 18 to 19.years now, how much is there? You cannot just wake up one morning and say 200 million dollars is there and next tomorrow, you say it is 400 million. Let there be audit because there is a specific account that the IOCs pay this money into

“Basically from what we know, not a dime has been taken from this money, so you cannot tell me that since 18 years that you have been collecting this money which is 3 percent of every single offshore supply boat, every tanker, every vessel looking in Nigeria.

“I left there when it was 100 million, why are you still telling me it is 350 million. That was twelve years ago” he said

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