The Managing Director of the Financial Derivatives Company Limited (FDC), Mr. Bismarck Rewane, likened Nigeria to a morgue of abandoned projects last week. He could not have been more apt. “Easy to start and easier to kill,” was Rewane’s way of describing the way public policies and mega projects are initiated in Nigeria before they are then abandoned. He said the novel idea of highway concessioning has become a nightmare that stalls “N11.54 trillion in private investment” in the country. Instructively, Rewane’s intervention came on the same day ‘LEADERSHIP’ newspaper published a report on how infrastructural projects worth hundreds of billions of naira have been abandoned by past and current governors in no fewer than 29 of the 36 states.

While interested readers can access the report, (https://leadership.ng/29-states-abandon-270-multi-billion-naira-projects/), the issue of abandoned projects and the implications for the future of our country is one I have addressed on this page several times. My last intervention, ‘Squandermania Nigeria Unlimited’ on 15th September 2022, followed a report credited to then Nigerian Maritime Administration and Safety Agency (NIMASA) Director-General, Bashir Jamoh, that years after taking delivery of a floating dock constructed with the whooping sum of N50 billion (about N500 billion by today’s exchange rate), it had not been put to use due to bureaucratic bottlenecks. “Now, as we are talking, I am just coming back from Abuja to get the consent and agreement of the people that will give us the location where we can place the floating dock. Up till now, we have not got a location,” Jamoh lamented. “And then, the other thing is that it has been there since 2018, nobody has worked on it, started it or tested it.”

Considering what I discovered yesterday about that scandalous floating dock affair, I want to excerpt from the column before making my concluding point:

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Dry docking is a term used when the ship is brought to dry land for submerged sections to be repaired, cleaned or inspected. There are only three functioning shipyards in Nigeria where minimal repairs of cabotage vessels of 500 tonnes are carried out. Two of these—Starzs Shipyard and Niger Benue Shipyard—are privately owned. The other, Nigerdock Limited, was originally 100 per cent owned by the federal government but was privatized following the demise of the Nigerian National Shipping Line (NNSL). That story is already well-documented.  

At its peak, Nigerdock had 29 vessels. Today, Nigeria’s flag administration is essentially dead and we no longer have a single ocean-going vessel. Our shipyards can barely repair cabotage vessels, forcing international shipping companies to other smaller African countries in order to retain their safety classification and insurance, as specified by the International Maritime Organisation (IMO). In fact, we currently depend on Ghana, Senegal, South Africa etc. to dry-dock all ocean-going vessels doing business in Nigerian waters. That explains why it’s almost criminal that a prime asset (measuring 125 metres by 35 metres, with three in-built cranes, transformers, and a number of ancillary facilities) meant to fill that gap could be allowed to waste for years. Now marooned at a Naval Dockyard, the floating dry Dock was envisioned to, and has capacity for, employing hundreds of Nigerians. It would also have served as a hub to train students in our Maritime tertiary institutions. 

For those who may not be conversant with maritime matters, ships are required to dry dock at least twice every five years to retain their seaworthiness. With an average of 5,000 ships calling on our ports annually, in addition to 400 active coastal vessels and several fishing trawlers, it is estimated that Nigeria could save up to N350 billion annually (more than a trillion Naira in today’s value) while also earning millions of dollars in the process. The maritime sector, like the oil and gas industry, holds considerable prospects for the development of our economy. But it is also being grossly mismanaged. Meanwhile, it costs more than $1million to tow vessels out of Nigeria for repairs when the cost of dry-docking itself (for which the floating dry dock was conceived) is approximately $400,000. This is a compelling story of lost opportunity, not to mention the cost of doing business in Nigeria. Of course, it is not surprising that we have ended up in this situation because those who conceive and execute projects in our country are usually more concerned about transactional details that benefit them than the more important consideration of public good.  

From my investigation, this story began on 23rd October 2013 under President Goodluck Jonathan when the Federal Executive Council (FEC) approved the contract for the “Construction of Ship Building Facility and Dockyard: Maritime Equipment and Structures, Ancillary Buildings and Electro-Mechanical Works and Facilities (Package 1) at Okerenkoko, Delta State for the sum of N40,243,702,763.38.” The contract period was 36 months effective from the date of receiving the first payment of 15 per cent mobilisation which translated to N6,036,555,414.49. “The balance payment shall be based upon the following modes: 65 per cent of the total contract sum shall be paid by irrevocable confirmed Letters of Credit (LC) to enable your Company import heavy duty equipment required for the project which includes Water Treatment Pipes; Powerhouse and Services; Travel Lift; Landing Modular Jetties; Modular Floating Dock and Cradle Set; and Quay Crane…”   

If we consider that the exchange rate in 2013 was N159 to a dollar, it is easy to understand the current value of this project, especially as it was paid in dollars. I have no idea why the contract exceeded its timeframe by more than a year or the rationale for increasing the cost by 25 percent. But on 29th May 2018, the company wrote to notify NIMASA that “following successful inspections by Manufacturer (Damen Shipyards), Lloyds officials, Debaj Engineering Company ltd (NIMASA consultants), the Modular Floating Dock (MFDd NIMASA, IMO 9785639) is heading to Lagos, Nigeria as per the communicated program of works and our previous notification letter.”   

After highlighting other technical details, the company then listed pending operational matters: “We kindly request NIMASA to notify the concern (sic) authorities regarding the arrival of OSPREY and the offloading of MFDd NIMASA in Lagos. We kindly request a resolution of the subject of location including access to the proposed site in Apapa, Lagos in order to proceed with civil and mechanical works for the mooring of the Floating Dock. Also be reminded that the existing old and faulty NPA floating dock should be moved/relocated in order to allow mooring of the new NIMASA Modular Floating dock; Registration of the Nigeria Flag for MFDd NIMASA, IMO 9785639; Obtaining waiver of custom duties for the modular floating dock and Obtaining Insurance for the floating dock.”   

The Floating Dock arrived in Nigeria in 2018, but what should be earning us revenue has become another huge burden. When we eventually decide to put it to use, we may also be talking of turn around maintenance running into billions of Naira. In fact, the Association of Marine Engineers and Surveyors (AMES) raised the alarm last year (2021) that the dry Dock had been removed from the Lloyd’s Registers Class because it could not be surveyed for three years. This raises several pertinent questions. Why did the federal government embark on such an expensive and highly technical project without a firm decision on where the Dry Dock would berth? Should NIMASA, a regulatory agency, take on the role of operator which the purchase of the floating Dry Dock implies? Why do public officials continue to promote ideas doomed to fail and, in this instance, not backed by the enabling law? And how are we sure we have not already created another monument to waste? Like Ajaokuta, most of the software in the computer-driven floating dock may have become obsolete according to some experts. 

The only rational explanation I can find online on this sordid affair was one provided by a former NIMASA Executive Director, Operations, Rotimi Fashakin (now of blessed memory). He told reporters in Lagos that berthing the dock at the permanent site of the Nigerian Maritime University, Okerenkoko, as was originally conceptualized, could not be done due to insecurity. “Initially when the floating dock was acquired, the design was for it to berth in Delta State. But even at that time, there were a lot of reports advising to the contrary”, explained Fashakin who added that the contract preceded the Buhari administration. “A dock is supposed to serve the shipping community as a commercial facility, but which company or vessel would be bold enough to travel to Delta State given the insecurity? When the dock landed in Nigeria, there were various state governments that requested for it, all these are on record. When it came in, we thought of many ideas, but this is a government asset and not something you can just give to an operator. NIMASA is a regulator and not an operator, so giving the dock to an operator also needs to go through the bureaucracy of government.”   

The fact that a regulator was trying to play in the same league with operators should have been clear to NIMASA before initiating the idea. But like most government contracts, we pay first and think later. The more information one obtains on this matter, and I have spoken to many stakeholders, the more despondent you become about our country – even if some of us refuse to give up hope. The greater concern is that this is not an isolated problem. Our national landscape is strewn with projects that were not well-conceived and have become liabilities after hundreds of billions of Naira had been invested in them.

In 2015, the then Chartered Institute of Project Management of Nigeria (CIPMN) president, Victoria Okoronkwo, estimated abandoned projects in Nigeria at N12 trillion. If we use the exchange rate at the time these projects were conceived and expenditures incurred, we should have an idea of the billions of dollars we are throwing away. Listing the projects by geopolitical zone, Okoronkwo said the South-east has 15,000; Southwest, 10,000; Southsouth, 11,000; Northwest, 6,000; Northcentral, 7,000: North-east, 5,000 and Abuja, 2,000. I have no doubt that hundreds of others have been added to the list since then…

ENDNOTE:

More than two years after that column, the NIMASA Managing Director who succeeded Jamoh is still talking about how they will put the drydock to use. “The initial plan for the floating dock was not the right one. We are going to put the Modular Floating Dock to very good use so that once it’s in operation; it will benefit the economy, seafarers, and NIMASA itself,” Dayo Mobereola said last August. “We need to place the modular floating dock in an appropriate location. It is just a matter of time; we will soon get that done.”

From my findings in recent days, even though the expensive drydock has been moved to Nigerdock, it is still idle almost seven years after it arrived in Nigeria! This extraordinary level of waste and mismanagement of scarce resources speaks volumes about the lack of accountability in a country that has now been appropriately dubbed a ‘morgue of abandoned projects.’

Enough said!