NLNG’s evil treatment of Nigerian seafarers 

By Bolaji Akinola

 

Elsewhere, seafarers are highly respected; enjoy good remuneration and good living standards. But not in Nigeria. Many of our seafarers are jobless. Those of them who have jobs are underemployed and owed several months in salary arrears. A few oil majors and the Nigerian Liquefied Natural Gas (NLNG) were the only beacon of hope for these hapless seafarers.

Incorporated as a limited liability company on 17 May 1989 to produce LNG and natural gas liquid for export, NLNG enjoyed pioneer status and a 10-year tax holiday. Even after its tax holiday, it refused to willingly pay statutory charges to some agencies of government like the Nigerian Maritime Administration and Safety Agency (NIMASA).

NLNG also has two wholly–owned subsidiary also set up in 1989. The subsidiaries, BGT and NSML, are the shipping arms of the organisation.

Bonny Gas Transport (BGT) provides shipping services to NLNG while the Nigeria LNG Ship Manning Limited (NSML) was set up in 2008 to provide, develop and manage seafarers for BGT.

Curiously, BGT was not registered in Nigeria and does not fly Nigeria’s flag. The promoters of NLNG, namely NNPC, Shell, Total and Eni International decided to register the company in Bermuda. Apart from being a flag of convenience, Bermuda at the time of BGT’s registration had gained the reputation of being a tax haven with a growing number of companies, encouraged by their financial advisers, incorporating in the British island territory to lower their taxes sharply without giving up the benefits of doing business in their home countries.

Banks, shipping companies and insurance companies led the way, with manufacturers and various other kinds of businesses following. Becoming a Bermuda company was a paper transaction, as easy as securing a mail drop there and paying some fees, while keeping the working headquarters back in the home country.

There was the case of Ingersoll-Rand which paid a meagre $27,653 a year in Bermuda, in a move that allowed it avoid at least $40 million annually in American corporate income taxes.

Companies which registered in Bermuda were not required to conduct any meetings or even have an office there. It is a pure tax haven. There is no official estimate of how much the Bermuda registration of BGT is costing the Nigerian government in tax revenues, but the Buhari administration will do well to compute this.

With the numerous benefits accruing to it since it began operation in Nigeria, one cannot but be surprised that the same organisation would decide to half the salaries of its Nigerian workers on flimsy grounds. In case you missed the story, NSML last week announced a 50% cut on the salaries of its Nigerian seafarers with effect from September 1. In a manner that the workers rightly described as “unjust, inhumane and partial”, the company asked them to accept the salary cut or quit. Curiously, foreign seafarers working for the company were not mandated to take the kind of haircut forced on their Nigerian counterparts.

The company’s argument that the salary cut was compelled by present day economic realities is flawed. Why were the salaries of foreign seafarers on the company’s not slashed by half? How about the top executives of NLNG, BGT and NSML? Why were their salaries untouched? Elsewhere, the executives take deep pay cuts first to save the company from collapse. We have seen this happen with several shipping companies and oil and gas firms.

Despite collecting a 20% mark-up on their salaries from NLNG, why has NSML failed to review the remuneration of these Nigerian seafarers since it employed them eight years ago?

NMLS must be prevailed upon not to effect this ill-advised and ill-timed pay cut especially at this trying economic time. The Nigerian Maritime Administration and Safety Agency (NIMASA), which has the responsibility of protecting the seafarers, must rise up to its responsibility of protecting these seafarers.

  

Copyright 2016 Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to www.shipsandports.com.ng as the source.