Desire for a National fleet is good – Greg Ogbeifun

The Ship Owners Association of Nigeria (SOAN) Arrowhead and Chairman, STARZS Group, Engr Greg Utomwen Ogbeifun needs no introduction in the global Maritime community.

You have been a strong advocate of enhanced shipping services in the country ; and we know Nigerians will want to know not only how this issue of National fleet or carrier came about, but also, how and why a foreign shipping company, the PIL sneaked into it. Can you please  enlighten us on this?

Thank you very much and thank you for this visit. But, let me quickly indicate that the whole initiative of re-establishing a Nigeria fleet; please note what I have said: ‘a Nigeria fleet’, not a national shipping line, nor a national carrier’; I said a Nigeria fleet was the brain child of the Minister. The desire for a national fleet is commendable.

When the Honourable Minister (Rotimi Amaechi) decided that he would  like to see, during his tenure, the actual emergence of Nigeria Government midwifed national fleet, he started a process which though he loved, but was based on lack of proper understanding of some basic issues.

At one point therefore, he decided to engage the stakeholders and the technicians in the industry, and that engagement got him setting up first, a committee to work out for the modalities for the establishment of a Nigeria fleet.

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SOAN Arrowhead and Chairman STARZS GROUP, Engr Greg Utomwen Ogbeifun with the Secretary General, International Maritime Organisation (IMO), Lim Ki-tack, during the 2016 Malta Summit, last month.

That committee of which I was privileged to be a member, finished her assignment and submitted her reports to the Minister. He did something that is not usual, there and then. For once he received the report, he also passed the report to us for implementation. In fact, all he did was to appoint a CEO of one of the agencies that is under his ministry to chair that implementation body, so that he can be a link between the committee members who were holding on mostly in the private sector and other tiers of government.

The name of this committee, the new committee became a Nigeria Fleet Implementation Committee [NFIC]. So we began to sit and while we were sitting, a company PIL who was desiring to support this initiative by partnering with the Nigeria entity, whoever they may be, forwarded their proposal to the Minister.

Not wanting to throw any spanners in the works, the Minister told them that there was already a committee set up for this purpose, directing them to the committee. The Minister also, immediately informed us about this development.

Now, all along, the minster has always said that the new NFIC must be 100% private sector holding and private sector driven, but with government support, especially, with government fiscal incentives; with government as mid-wife so as to give confidence, until this body is strong and stable enough.  That was the genesis of PIL.

We then had two meetings with PIL in Nigeria, where we discussed generally, what mode of partnership we can have with them; or the Nigeria of investors can have with them.  They came up with a proposal offering 40% executive investment from their side and Nigeria 60%.

We discussed further and we all came up with the idea of providing the Joint Venture (JV) with enhanced platform.
They initially wanted to provide the JV or the SPV  that were merged more of expertise. They will provide the managing director/ CEO; they will provide the COO and then we will provide the CEO. We said no, and that became the subject of further discussion and negotiation.

At one point, the representatives of PIL that  we were discussing with here said that since some of the issues were beyond professionalization, they would forward the discussion to their head office in Singapore.
When the head office in Singapore got that, they said they would like to invite the Minister and his team to Singapore to discuss further and possibly come out with an MOU that will form the basis for further delegations.

That was what led to the Minister going on that invitation. But, he said he couldn’t go alone and had to pick some of us, to go with him. So when we got to Singapore, we went to the head office of PIL, their Managing Director; the Nigeria High Commissioner in Singapore; the Singaporean Controller General in Nigeria were present; then our team and that of the PIL. Also present in our group was the Director, Maritime Service in the Federal Ministry Of Transport.

We then went into intensive discussion, in the end, because I believe that the Nigeria investors will hold 60%, the PIL will hold 40%, it was agreed that PIL would bring the Managing Director /CEO; we will bring a Deputy Managing Director; they will bring a COO and will bring a Deputy COO from Nigeria; we will also bring the CFO, while they will bring a Deputy CFO.

Other things that we also agreed on were that the Head Office and the control the emerging company will be domiciled in Nigeria; that for every position that will be required in the management, the SPV will jointly go out and look for competent Nigerians in the country and out of the country, who can be brought in, and that it is only when such competent Nigerian cannot be found that we can tap into the pool of PIL. So at every stage we did everything we can to ensure that the relationship was going to equitable.

So after all that, the MOU was jointly drafted by our legal officers and directors from Nigeria and their own people. It was then read out and captured, after which it was agreed that PIL should develop a business case, from their experience, the types of ships which could mainly be cargo focused.