…Stakeholders demand audit, tariff reset
…Concession under review, NPA
By Steve Agbota
Uncertainty over the renewal of port concession agreements has forced terminal operators to suspend fresh capital investments, raising fears that Nigeria could forfeit an estimated $6.54 billion in projected revenue.
Industry stakeholders warn that the prolonged delays are stalling expansion plans, equipment upgrades and efficiency improvements across key seaports, at a time when regional competition for cargo traffic is intensifying.
Operators and maritime groups are now calling on the federal government to urgently conclude the renewal process, conduct a comprehensive performance audit of existing concessions, and review port tariffs to restore investor confidence and safeguard long-term growth in the sector.
However, checks by Daily Sun on the World Bank portal show that the terminal operators took over the ports in 2006 and injected an estimated N200 billion in investments within their first decade of operations.
According to the World Bank, the tenure of the Nigerian concession agreements ranged from 15 to 25 years and the estimated revenue to the government from the concession agreement is estimated at $6.54 billion over the period.
Insiders insist that the federal government stands to lose billions in projected revenue if the lingering impasse over concession renewals is not resolved.
Nonetheless, authorities have held back on granting fresh long-term approvals, pointing to concerns over compliance gaps, insufficient capital injection and alleged breaches of contractual obligations by certain terminal operators.
Investigations by Daily Sun reveal that, instead of concluding the long-overdue review of the agreements pending since 2016, the government has opted for successive six-month extensions for operators with expired concessions.
What was intended as a temporary measure has effectively become standard practice, deepening uncertainty across the port system.
Commenting on the issue, the General Manager, Corporate and Strategic Communications Division, Nigerian Ports Authority (NPA), Mr. Ikechukwu Onyemekara, said the concession was being reviewed.
He said: “Well, let me start by saying concession of the Nigerian ports was a huge success and the growth that we have experienced can be attributed to the invitation of private terminal operators into the port system, which is globally the way to go.
“However, as you know, the concession was for a period and normally, after the period, we need to do a review.
“Before now, there were some great areas of the concession, areas that had to do with the best way to be able to get the full benefit of concession, that is getting every party involved to do what is expected of him.
“And the government is very careful to ensure that in the review, we come out with the best outcome.
“So, it’s not something to be hurriedly done, I must tell you. So, the moment that is done, the moment the government takes its time to conclude it, we’re going to see the outcome”, he said.
Onyemakara added that stakeholders need to be patient and allow the government to do a thorough job on the review, so that whatever gaps have been seen in the past concession programme will be very well taken care of.
However, some stakeholders who spoke to Daily Sun said the government’s refusal to grant a long-term concession agreement was due to inefficiencies in some of the terminal operators.
A clearing agent at Port Harcourt Port, Vincent Ebube, acknowledged that while terminal operators have acquired equipment and made visible investments, their operational inefficiencies would be considered unacceptable in more advanced maritime jurisdictions.
“If you recall, last year, the federal government threatened to revoke the licence of underperforming terminal operators at the port because most of them are not doing well. You know the initial 10-year licenses of most terminal operators in Nigeria, operating under the Build, Operate and Transfer (BOT) model, were extended in 2016 for an additional five years. Since these extensions expired in 2021, the federal government has been reluctant to extend them.
“From reliable sources, the federal government has decided not to renew the agreements with about 19 terminal operators, due to poor investment and failure to upgrade port infrastructure to global standards as a reason. The level of investment at the ports is not what the government expected. When you compare our facilities to neighbouring ports, you’ll see that we are lagging,” he said.
Recently, the President of the Senior Staff Association of Statutory Corporations and Government Owned Companies (SSASCGOC), maritime branch, Akin Bodunde, also urged the federal government to immediately blacklist underperforming terminal operators at the nation’s seaports by not renewing their concession license agreements.
Speaking on the delay in the renewal of the port concession licenses of terminal operators, he said that some of the operators have not performed optimally.
“I don’t want to mention their names, but the Nigerian Ports Authority management knows them, and I know the power behind all of them. But we know the ones that are performing.
“There are a lot of political issues attached to it, and I know the government is looking at it, because if you know Nigeria, the people behind these concessionaires are not just people you can push away overnight.
“But I know there are a lot of committees set up to look at their activities and performance. If they use that yardstick, automatically we should be able to remove the bad ones and work with the good ones,” he said.
Bodunde also criticised the port concession for failing to create substantial direct employment despite the initial promise of generating about 500,000 jobs.
He claimed that the total number of direct employees on the payroll of all terminal operators nationwide is less than 2,000, excluding dockworkers employed by separate companies.
The Managing Director of Mikky Excellency Nigeria Limited, Alhaji Abdulazeez Mukaila, said: “I want to believe that I am going to score the whole process, maybe 35-40 per cent. The whole idea of not a government business, consequently let private investors take over the port operations has not yielded much desired results.
“The little achievement we have recorded, I am going to hinge it on the government’s political way to invest, at least to some extent, in the port structures that have deteriorated over time.
“Port structure in the sense of road network, port access road network, that is what has really helped the concessionaires to hide their ineptitude and their inability to meet the bidding that was expected of them.
“So, in my own view, you can’t score more than like 1 per cent of them, or like 5 per cent of concessionaires that you can say at least they are putting up a good show. So it’s not a good one in the long run,” he said.
He suggested that governments really want to be very serious, just like the problem of the power-generating company, the Gencos, governments need to dismantle all these and go back to the drawing board, saying that Nigerian citizens have not been better for the concessionaire in agreement.
“I think it’s better for the terminal operators not to invest. Abinitio, they have invested nothing for the last 20 years. I didn’t see the capability, the structural effect they brought in.
And I can tell you the return on their investment over 20 years, there is no other clime, any other country where they can reap so much without putting nothing significantly inside the agreement. So if they want to stop, let them stop. At least we can suffer it for another 6 months and hope for a better future,” he said.
The President of the Africa Association of Professional Freight Forwarders and Logistics of Nigeria (APFFLON), Frank Ogunojemite, called for an urgent and comprehensive review of Nigeria’s port concession agreements, 20 years after the reform programme initiated by the Nigerian Ports Authority.
He said while the concession model was designed to deliver efficiency, attract private investment, and reduce the cost of doing business, the reality facing freight forwarders, manufacturers, and shippers today tells a different story.
He noted that port charges continue to rise, handling fees remain excessive, and congestion has resurfaced intermittently, placing unbearable pressure on the nation’s logistics chain.
“APFFLON acknowledges that some level of equipment investment has occurred. However, the critical question remains: have these investments translated into lower costs and globally competitive service delivery? When compared with regional competitors such as the Port of Tema and the Port of Lomé, Nigerian port charges remain significantly higher, undermining our competitiveness and encouraging cargo diversion.
“We, therefore, call on the Federal Ministry of Marine and Blue Economy to immediately commission an independent performance and financial audit of all terminal operators. Concession agreements must be transparently reviewed to determine compliance with investment obligations, adherence to performance benchmarks and justification of current tariff structures,” he said.
He warned that port reform must not become a transfer of monopoly power from public to private hands without strong economic regulation, saying that Nigeria deserves efficient, transparent, and cost-competitive ports. If performance falls short of contractual obligations, renegotiation is not only justified, it is necessary in the national interest.
Most of them are expired, and the federal government right now has not been able to renew anyone.
The National President of the Association of Nigerian Licensed Customs Agents (ANLCA), Emenike Nwokeoji, said there is no doubt that the concession in the port was the right step at the time it was taken, saying it was a right decision, but whether they meet up with demands is another thing entirely, because it differs from one terminal operator to the other.
“So, many of them have been doing well that we can give them. Some years back, it would have taken you two weeks to drop a container for examination. You queue up again for loading. But right now, so many of them, if you apply for examination today, a container will be ready for loading tomorrow.
“The container will be down tomorrow for you to conduct a physical examination. You know, operating in our environment, I’m not holding brief for them. Are you there? Operating in our environment, when we start comparing ourselves to other clients, it is wrong,” he said.
He said, despite the concession, the volume of containers stakeholders still examine in this country is abnormal, saying it’s not done anywhere, and most of those things have gone electronic.
He urged the terminal operators to keep investing in equipment and in the ports for them to be efficient in terms of service delivery, saying that they also need to expand and dredge in order to accommodate large vessels at their terminals.
However, all efforts to speak with representatives of the Nigerian Ports Authority (NPA), the Nigerian Shippers’ Council and terminal operators proved abortive as they were not picking up calls and responding to messages as at the time of filing this report.
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