The Nigerian Maritime Administration and Safety Agency (NIMASA) has revived efforts to change the terms of trade for the affreightment of Nigerian crude oil from Free on Board (FOB) to Cost, Insurance and Freight (CIF).
The Director-General of NIMASA, Dr. Bashir Jamoh, disclosed this in Lagos, when he received a delegation from the Nigerian National Petroleum Corporation (NNPC) led by the Group General Manager, Crude Oil Marketing Division, Billy Okoye.
Jamoh, who recently paid a visit to the Group Managing Director of NNPC, Mele Kyari, at the corporation’s headquarters in Abuja, said the agency was working towards the implementing a national maritime security strategy to improve security in Nigerian waters and reduce the cost of shipping.
“Since 2018, NIMASA has championed moves for a change in the terms of trade with regard to transportation of Nigerian crude oil, from FOB to CIF to ensure greater benefits for the country from its oil resources. A technical committee involving NIMASA, NNPC, and other stakeholders would be set up to develop a template for the desired change, with workable timelines,” he said.
Under FOB trade terms, Nigeria has no reasonable control over the delivery of its crude oil as regards carriage, insurance, and other ancillary services. But under the CIF arrangement, the country maintains ample control over the distribution of its oil, which can be leveraged to enhance the competitive advantage of indigenous operators.
Jamoh commended the synergy between NNPC and NIMASA, saying, “Seventy per cent of the agency’s revenue comes through the sale of crude. Thus, cooperation between NNPC and NNPC cannot be over-emphasised.”
“The Maritime Intelligence Unit recently established by the agency is part of efforts to ensure a proactive approach to security in our waters. The focus is to try to nip maritime attacks in the bud by tracking the criminals from the pre-planning and planning stages.
“The ultimate aim is to develop a National Maritime Security Strategy that would help to minimise the cost of insecurity, which NNPC bears on behalf of the country, in the shipment of Nigerian crude.