The Managing Director of the Nigerian Ports Authority, Mohammed Bello-Koko has said that the 2006 port concession wasn’t in the interest of Nigeria
Hybridnewsng gathered that fresh facts have emerged that the the concession agreement which the Federal Government entered into with terminal operators about 16 years ago wasn’t in the interest of the Nation.
The Federal Government, had in 2006, approved the concessioning of the nation’s seaports to make it more efficient.
Though, some concessioniers have taken steps to develop and improve on what they met on ground at the time they took over, but some have also left it with little or no development on the infrastructures as agreed.
This in no doubt have also effected the container Turn Around period. While the operators seems to be smiling to the bank, the Nation seems not to be getting value from their investment.
The Managing Director of the Nigerian Ports Authority, Mohammed Bello-Koko, while taking a look at the current arrangement, said the concession process wasn’t done in the interest of the Nation.
Bello-koko revealed that the first port concession agreement signed in 2006 was skewed against the country’s interest and thus the urgent need for a review to correct the imbalance and also reflect current dynamics in the country’s port industry.
Speaking on Arise TV program, the NPA helmsman, disclosed that though the authority wasn’t thinking of terminating any lease agreement with any of the terminal operators, as being peddled by some of the concessionaires, but that rather the authority is demanding for a new concession agreement that would be fair to Nigeria and Nigerians.
“Between 2006 when the first port concession agreement was signed and 2022, a lot of things have changed, especially in terms of the needs of the country and other requirements and regulations of the ports industry, which have necessitated a new agreement.
“The Infrastructure Concession and Regulation Commission ICRC Act, which is a commission that regulates the concession of the country’s infrastructure, is a clear departure from the 2006 era when only the Bureau of Public Enterprise BPE was the only agency charged with the regulation of privatisation and concession of such national infrastructure.
“As part of efforts to carry out a holistic review of the concession agreement, an inter-ministerial committee drawn from the NPA with the World Bank as its consultants, the Federal Ministries of Transport and Justice, the terminal operators and other relevant stakeholders was set up. The committee drafted a more comprehensive agreement to suit current realities in the industry and also provide a balance.
“We have always believed that the old concession agreement was not skewed in favour of Nigeria through the NPA. In reviewing the concession agreement, we looked at the scorecard; there are some responsibilities the NPA should have carried out that it is yet to do, on the part of the terminal operators, there are also some obligations that they have not been able to fulfil. There were issues with Gross Metric Tonnage GMT and so on.
“The essence of the inter-ministerial committee review of the concession is for both parties to come to the same point before signing.
“Subsequently, we sent the draft agreement to the Federal Ministry of Transport for final approval. Incidentally, some of the terminal operators’ leases are about to expire and we also discovered that most of them are at the Tin Can Island Port.
“In the old agreement, there was no issue about port physical infrastructure development and here we are being asked to renew the concession of a terminal that is collapsing and so there is the need for us to reconstruct them and we asked the terminal operators how they want to develop their terminals and how much they plan to spend.
“The ICRC Act was not there when the concession agreement was signed in 2006 but it is there now. The ICRC initially recommended that we should advertise these expired leases and terminals for us to have an international bid.
“The first concession agreement also gave the terminal operators right of first refusal and this is already a conflict. So what we did was to ask the terminal operators to bring their Outline Business Case OBC.
“The OBC would give us an insight into their development plan such as how much they are going to spend over time on equipment, what kind of equipment and how much they are going to spend on developing physical infrastructure of their terminals. I was however surprised that one of the MDs of the terminal operators came on this studio, saying something different.
“We want a concession agreement that gives NPA the powers it does not have in the old agreement; powers to impose sanctions, monitor and ensure that they have the right equipment. The terminal operators should therefore allow us to come up with a new concession agreement that is fair to Nigeria and Nigerians” he said.
Bello-koko however admitted that some of the terminal operators have fulfilled their obligations in terms of providing equipment as contained in the old agreement, assuring that the authority was not planning to terminate the contract agreement of any of the concessionaires.
The NPA-boss further disclosed that the Federal Ministry of Transport has directed that the authority should go ahead with the temporary renewal of some of some of the concession agreements, but that it must be on fair and equitable terms, which must be favourable to the country and its citizens.