Oil Price Rise Will Boost Logistics Business

The Managing Director/Chief Executive Officer, Fortune Global Shipping & Logistics, Mr. Eric Opah, has said the oil and gas logistics subsector in Nigeria will receive a boost from the recent rally in global oil prices.

Opah noted that the slump in oil prices which began in mid-2014 had led to the delay of many projects in the Nigerian oil industry.

“With the oil price going up, we expect a lot of new projects to spring up. For us at Fortune Global, our strategic direction is to create a logistics base where we have a one-stop shop facility to support the oil and gas and energy logistics. We are currently evaluating our business plan towards that direction. It is all in a bid to become a Nigerian-owned entity, operating locally and internationally,” he said at a press briefing in Lagos.

He also said the company had already taken the centre stage in the oil and gas and energy logistics, adding, “We handled the inward clearance of the Egina Floating Production, Storage and Offloading vessel. The performance of the inward clearance is really very important to see that all the documentation is done correctly in such a manner that it appeals to our customer.

“We supported the Nigerian Ports Authority from our own part of the documentation to ensure that the declaration and the inward clearance were done properly. We did the boarding and brought all authorities; the inspection was done from the beginning to the end. What we did has a lot to do with all authorities including the NPA, NIMASA, the Nigeria Immigration, the Nigeria Customs Service, the NDLEA and the SSS.”

Commenting on what the local content law had achieved, Opah said, “What the local content has done with the Egina project, bringing the FPSO into the country for integration is the most outstanding.

“A lot of Nigerian contractors got involved. A lot of fabrication was done in Nigeria. Paints were manufactured in Nigeria and shipped to South Korea. The impact of the local content cannot be overemphasised.”

He, however, stressed the need for new projects in the oil and gas industry to prevent the facilities that had been developed by local operators from becoming idle.

According to him, the logistics industry has not actually taken shape in Nigeria the way it should.

Opah said, “It is not being recognised the way it is in other countries. Freight forwarding and logistics in countries like China is a lucrative business. Here, people rely more on the Customs’ clearing and brokerage.”

He said the company had in 11 years grown from a brokerage business to an international forwarding company, adding, “In 2010, we expanded into oil and gas and energy logistics, providing solutions for the oil and gas industry. Today, we have expanded into other countries.

“The biggest challenge there is no institutional framework to handle payment-related issues. There is no regulation about data that could be shared that could protect operators in the industry. We have seen it happen so much in this industry where one client owes you and jumps to another company without paying you. There should be a high effort from government to support with a regulation that protects us. We collect money and pay the government.”

Source: Punch

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