Port Dredging: NPA Undecided Over Future Of $70m JV Contract

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Posted October 9, 2019

As the contracts for the dredging of Lagos and Bonny ports channels expires next year, the Nigerian Ports Authority (NPA) is hinging the renewal of the $70 million channel management contracts on a study the agency is carrying out.

LEADERSHIP learnt that NPA had a third party joint venture (JV) agreement with some foreign firms for capital and maintenance dredging of the Lagos and Bonny channels, provision of navigational aids and removal of shipwrecks. NPA holds 60 percent stakes in the companies.

The firms, Lagos Channel Management (LCM) and Bonny Channel Management (BCM) were formed in 2006 after NPA entered into joint venture partnerships with some “technical partners”, including Dredging International, Vinci, IPEM and Dapesa Maritime International.

Each year, NPA said, the companies got contracts worth $70 million without competition. However, LEADERSHIP investigation had shown that the JV contracts between NPA and the channel Management firms would end by June 2020.

It was learnt that fear has gripped the maritime industry as NPA was yet to decide whether to renew or cancel the JV contracts. Independent sources said that the Authority was looking at the entire joint ventures relating to the channels management.

However, speaking exclusively to LEADERSHIP, managing director of the Nigerian Ports Authority (NPA), Ms. Hadiza Bala-Usman assured operators that the authority would ensure that the channels are navigable.

She confirmed to LEADERSHIP that the authority is yet to conclude at exactly what they are to do with the dredging firms. She also disclosed that the authority had initiated a dredging optimisation study of all the channels leading to all seaports in the country.

“We are looking at all options available to us and currently, we are embarking on dredging optimisation study. It is a study that will determine the form of dredging we will do in Nigerian ports,” she said.

When asked whether the contracts will be renewed or cancelled, Bala-Usman said, “Well, we are awaiting the outcome of the dredging optimisation study of the channels to determine what we intend to do with our dredging firms but what is important is that we will maintain our channels.

“We will manage them to make sure that everything will be provided in terms of safe navigations and necessary works that will make our channels navigable but we haven’t concluded at exactly what we are going to do,” she added.

Effort to speak with head, Human Resources, LCM, the dredging firm in charge of Lagos Channels, Prince Falade Oyekan proved abortive as text messages sent to him were not replied.

However, a source at the company said the consistent dredging of the Lagos channels have made big vessels call at the ports at the western zone. According to him, tonnage has grown at Lagos ports and has indirectly led to profit for the Authority and the company.

The source said, “The profit comes indirect, since the port has become more efficient and effective, so bigger ships can come in and more often, the tonnage has grown since the inception of LCM.”

Source: leadership.ng