Trouble ahead: NIMASA-NLNG dispute puts Nigeria’s gas export in danger

by Ogunyemi Bukola

NLNG gas plant

A major trade dispute on Friday ensued between the Nigerian Maritime Administration and Safety Agency (NIMASA) and the Nigeria Liquefied Natural Gas (NLNG) Company which has led to the maritime agency blocking access to the nation’s major loading terminals for gas export, the Bonny terminals.

NIMASA took this action about noon on Friday, basing its decision over NLNG’s alleged refusal to pay the statutory 3% levy on every freight entering or leaving the country through the nation’s territorial waters.

In a statement sent to the media, which was signed by NIMASA’s Acting Director, Shipping Development, the maritime agency confirmed that it has prevented NLNG, from carrying out import and export of gas through one of the Bonny terminals, due to debt owed it by the gas company.

“By this blockade all Nigeria Liquefied Natural Gas Company (NLNG) vessels, operating in the area are neither permitted to leave nor enter the area until all statutory obligations are met,” the statement reads.

NIMASA gave as reasons for its action, among others “NLNG’s disregard and demonstrated unwillingness to abide by the country’s Maritime laws especially sections of the NIMASA Act that mandates payment of levies based on gross freight on exports and imports and the Cabotage Law.”

NIMASA’s action, experts warn, has the potential of costing the NLNG billions in revenue.

NLNG reacts

The General Manager, External Relations of the Nigeria Liquefied Natural Gas (NLNG), Kudo Eresia-Ekeh, has confirmed what he described as the unfortunate of the Bonny terminals by the Nigerian Maritime Administration and Safety Agency (NIMASA).

He confirmed that NLNG has not been making payments to NIMASA, because such payments would constitute an illegality. He stated that the levy being demanded by the maritime agency is not covered by the NLNG Act which governs the activities of the gas company.

He explained that officials of both bodies had earlier met and the position of the company was made clear to the agency. He lamented that NIMASA’s action puts “Nigeria’s image in disrepute” because the NLNG is dealing with international customers on long term contracts.

It was gathered that top officials of NLNG and Shell Petroleum Development Company (SPDC) have made contacts with the Presidency to intervene in the trade dispute and compel NIMASA to reverse the blockade.

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