BY  GODFREY BIVBERE, in Houston, Texas

Senator Ben Ayade, member of the Senate Committee on Marine Transport, has blamed the International Oil Companies, IOCs, and insurers of Nigerian owned vessels for the failure of the Cabotage law.

Ayade, who spoke to Vanguard in Houston, Texas, United States, at the ongoing Offshore Technology Conference, OTC, said that despite efforts by the executive and legislative arms of government, the IOCs have frustrated moves to involve indigenous ship owners in the lifting of the country’s crude.

He said that the IOCs were also insisting that all ships to be contracted by them must have been insured abroad because the local insurance companies do not have the capacity to do so.

He said: “The major challenge is that even the vessels that we have, most times the IOCs are very reluctant to contract the Nigerian vessels to do most of their jobs.

“As they go further into deep offshore operations, it becomes more difficult for Nigerian operators to run their vessels. They are even reluctant to commit Personal Supply Vessels, PSVs, to Nigerian companies.

“So, the Cabotage Act which was basically intended to make Nigerians to become top players in maritime sector has not achieved its aim because it takes a lot of energy from the National Assembly and indeed the Federal Government of Nigeria to compel the IOCs to contract the Nigerian registered vessels to do this business.

“But above all, the biggest challenge we have is the fact that the insurance premium, the cost of insurance some time cannot be supported by Nigerian operators because most of the major insurers are foreign insurers.

“Most insurers are based in London. If fact Singapore had a similar experience and what they did was to ensure that every major vessel in Singapore has insurance in Singapore to domicile that fund in their country.

“I hope we get to that time when Nigerian re-insurers have to ensure that they insure Nigerian operators to ensure that the IOCs use Nigerian vessels. Until we do that by strong deliberate patriotic act, we will continue to lose most of our petrol dollar.

“The cost of producing oil is almost equivalent to the cost of shipping it out for refining and bringing it back. We have reached the point where we must have Nigerian vessels carry our crude.”

He  expressed hope that after the amendment of the Cabotage Act, which is expected to give more powers to Nigerian Maritime Administration and Safety Agency, NIMASA, it will increase the opportunities in terms of employment and revenue for the nation.