Why we decommissioned Rivers Ports Terminal B-NPA …As Bua Group alleges vendetta
The Nigerian Ports Authority NPA has said that its decision to decommission the Rivers Ports Terminal B concessioned to BUA Ports and Terminal Limited about 13 years ago was due to the dilapidated state of the facility and resultant health and safety concerns occasioned by the failure of the terminal operator to fulfil its contractual obligations.
But in a swift reaction, the BUA Group disclosed that in addition to failing to carry out its obligations under the concession agreement, which is necessary and required for any meaningful reconstruction to be done at the terminal, NPA also failed to respond to BUA’s several requests for approval to carryout remedial action on the berth. It insists that the action was a mere vendetta.
NPA, speaking through its General Manager, Corporate and Strategic Communications, Jatto Adams, disclosed that Bua through a letter dated May 16, 2019, communicated to it of the dilapidated state of the berth and stating among others that the jetty was also in a state of total dilapidation and in urgent need of repair or reconstruction, which the NPA’s Engineers have inspected and warned may collapse any moment.
The GM said: “As a result, NPA found it necessary to decommission the terminal out of safety concerns. This is a measure to forestall imminent danger as highlighted by BUA Ports and Terminal themselves and to allow for a comprehensive conditional survey of the state of the Rivers Ports in totality. All these steps are in line with international best practice on safety at port locations.
“NPA therefore states that the decision to decommission Rivers Ports Terminal B results from its unwavering commitment to the rule of law as well as the safety of all Nigerians. Nigerians should regard these allegations as attempts by BUA Ports and Terminal Limited to blackmail and intimidate the NPA and stop the law from taking its course in the current situation. As a responsible regulator having received that alarming letter on the state of the jetty by the operators, the authority was compelled to act in the manner it did to safeguard infrastructure at the Rivers Ports and the ensure the safety of its users.
“It is pertinent to note that the process for the default notices issued to BUA commenced in February 2016 before the appointment of the current Managing Director. However, in line with her commitment to the rule of law, she proceeded to implement the recommendations to safeguard the sanctity of the agreement and protect the Federal Government from a defaulting concessionaire seeking to defraud the government by using its facilities without making the due investment enshrined in the development plan of the concession agreement.
“Resultantly, any inference of vendetta against the chairman of BUA Group is another of the numerous tactics aimed at distracting the Authority and stopping Nigerians from seeing the flagrant disregard of the contractual agreement by BUA”.
Going down the memory lane, NPA had noted that BUA Ports and Terminal Limited became concessionaires for Rivers Port Terminal B for a 20 -year tenure in line with the Port Reforms policy through a concession agreement contract dated May 11, 2006 but that the terminal was handed over to it on August 10, 2006.
It also said that as at February 2016, 10 years taking over the terminal, the company allegedly failed to commence the reconstruction of berths 5-8 as required by the agreement, thus prompting NPA to issue a letter drawing their attention to this non-compliance, adding that the company refused to honour this fundamental and material term of the lease agreement which compromises the integrity of the other adjoining berths in the ports, despite receiving the letter dated February 3, 2016,
Investigations further showed that NPA served a default notice dated February 11, 2016 and another one dated July 27, 2016 on the company in which it reminded the terminal operator of the non-compliance, which led to the deterioration of berths 5-7 and the total collapse of berth eight, which constitutes a breach of the concession agreement and a threat to the safety of lives
The authority also on November 11, 2016, issued a three-month termination notice on the company, citing default notices served on them in relation to the non-fulfilment of the obligations under the lease agreement, which made the company approach a Federal High Court in Lagos on January 18, 2018 barring the authority from enforcing the termination, which it got for a period of over nine months.
Meanwhile, in a statement, Bua Group disclosed that it had contacted a renowned construction company to effect the needed repairs at the terminal, having paid a total of 4.7million euros but lamented that requests for approval sent to NPA for work to begin were not replied.
The statement reads in part: “It is gratifying to note that the MD of the NPA admitted issuing a Notice of Termination but interestingly omitted to acknowledge that NPA failed to abide with the provisions of the Lease Agreement especially the dispute resolution provisions. The agreement provides that certain steps must be taken where there is a dispute which if cannot be resolved amicably, should be referred to arbitration.
“As a responsible corporate citizen, which appreciates the coercive powers of the NPA as an agency of government, BUA approached the Federal High Court for the protection of its rights and investments. The court dutifully granted an injunction restraining the NPA from giving effect to the Notice of Termination and also ordered parties to proceed to arbitration in accordance with the terms of the Agreement. In essence, NPA was enjoined to await the outcome of the arbitration proceedings.
Rather than wait for the outcome of the arbitration proceedings, which NPA itself had initiated, NPA again issued a letter decommissioning the terminals, which is tantamount to an effective termination of the Agreement, ostensibly relying on a letter written by us requesting the approval of NPA (as required under the agreement), to carry out remedial works.