Nigerian govt ends undue dominance and monopoly in oil and gas logistics sector

Nigerian govt ends undue dominance and monopoly in oil and gas logistics sector

Integrated Logistics Services Nigeria Limited’s (Intels) dominance of the nation’s oil and gas logistics business at the ports has ended with President Muhammadu Buhari’s approval of a policy review, which guarantees the right of importers to choose terminals or ports of their choice for the discharge of their cargo.

The president also approved the Onne Oil and Gas Free Zone Terminal in Rivers State as a multi-purpose cargo terminal, saying its non-designation as such previously did not in any way legally obstruct or compromise the operations of the free zone for all cargoes, including oil and gas.

The presidential approval was contained in a letter dated May 5, 2017, which was signed by the Managing Director, Nigerian Ports Authority (NPA), Ms. Hadiza Bala Usman, to the Managing Director of Josepdam Port Services Limited (JPSL), another port terminal operator.

Intels, previously NICOTES, which among others, was granted a concession to operate terminals at the ports has dominated the business to the consternation of other operators who accused it of running a monopoly with the connivance of senior government officials, particularly at the NPA.

Its most evident stranglehold was in oil and gas logistics services, which it claimed to have an almost exclusive concession over, as most cargoes in that sector were directed to its terminals for discharge by government agencies saddled with the responsibility of regulating port operations.

Many other operators, including Josepdam that was formed in 2006, and in May that year got a concession from the federal government to handle bulk and general cargo, complained loudly about what they termed Intels’ monopoly of the business.

So loud was the agitation that shortly after she took over in September last year, Usman promised to institute a policy reform that would end the said monopoly. She would seem to have delivered on her promise, setting up a policy reform committee whose recommendations were approved last month by the president. Read the full report here.

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