Vanguard News Nigeria

Samsung workers lament alleged locked out of Lagos Free Zone

By Ediri Ejoh

Global Resources Management Limited (GRML), a subsidiary of Lagos Deep Offshore Logistics (LADOL) base, may have  concluded plans to sack Samsung Heavy Industries (SHI) Nigeria Limited from the LADOL  Free  Zone in Lagos, investigation has revealed.

SHI operates a fabrication and integration yard (SHI-MCI yard) in LADOL Free zone, which was used to integrate the Egina Floating Production Storage Offloading (FPSO) vessel, which has sailed away to the 200,000 barrels per day Egina oilfield.

Samsung

The SHI-MCI yard is a joint venture between LADOL and SHI with SHI having 70 percent stake and LADOL 30 percent. The yard is the only one of its kind in Africa, designed to make Nigeria a hub of FPSO fabrication in the continent.

Sunday Vanguard investigation reveals that SHI will lose over $300 million of investments if sacked from the island as it will be difficult for the Korean firm to remove the fixed assets in the yard and to evacuate the fixed assets would require dredging of the river, which will gulp millions of dollars.

It was alleged that LADOL has denied SHI workers access to the integration and fabrication yard since Monday, a development that has sent wrong signals to international investors on the risks involved in investing in Nigeria’s free zones.

Our reporter, who visited the LADOL jetty in Masha Place in Ademola Street Ikoyi, yesterday, saw hundreds of Nigerian workers of SHI who were stranded at the gate because they could not be allowed entry to the island to resume work.

Workers lament

Some of the workers, who spoke to journalists that witnessed the incident, said LADOL’s actions will prevent potential investors from investing in Nigeria’s free zone.

“President Muhammadu Buhari is in China to woo investors but a company like LADOL is frustrating his efforts by chasing investors away. The president is in Asia with a strong delegation of governors and ministers when another Asian investor is being denied access to its investments. How do you convince other investors that Nigeria is safe for investments?  How can foreign investors come to Nigeria’s free zones when they see what is happening to Samsung?”, one of the workers said.

He alleged that the free zone is investment hostile.

Another SHI worker, who spoke to journalists, said it was SHI that brought LADOL to national limelight with the fabrication and integration of the Egina FPSO in the free zone.

“LADOL has received far more than $100 million from SHI-MCI since the commencement of Egina Project,” he said.

“LADOL used to be a deserted logistics base without much activity away from Onne, Rivers State and Bayelsa State. However, with hard work of Samsung Heavy Industries as the Contractor to Total for the execution of the Egina Project and its success story, LADOL has received more attention than it deserves. LADOL is only a logistics operating company with a Private Jetty. LADOL does not have a Port or a fabrication and integration yard. LADOL advertises and leverages on Samsung’s Fabrication and Integration yard as if it is owned by LADOL.”

Investigation revealed that LADOL’s grouse was that SHI was dealing with NPA, NCDMB and other regulatory agencies instead of dealing with  it.

In a quick reaction, the management of LADOL explained that the action was in pursuant to the company’s gross misconduct to compliance of stipulated laid down rules.

“As a responsible Nigerian company, Ladol has put public duty and national interest ahead of its private interests and concerns for some time, with respect to the Egina project and the actions of Samsung, “it stated.

“However, LADOL now has no choice but to bring to the fore issues that have arisen due to the actions of Samsung.

“Samsung has brazenly and persistently flouted Nigerian laws and breached contracts it duly signed with Ladol and its affiliates. Samsung failed to meet the minimum standard required to qualify for an Operating License in a Free Zone, their license has therefore expired without renewal b) Samsung’s Sublease Agreement has been duly terminated c) Ladol has filed a court action (Suit No FHC/L/CS/1459/2018) against Samsung related to their fraudulent activities in Nigeria Please note that LADOL as a Nigerian company is resolute about enforcing its rights and protecting our  country from companies and contractors that flagrantly disobey our laws and disrespect their local partners.”

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