Shipowners Urge Dangote, Major Cargo Owners to Back Local Fleet Development

Indigenous shipowners have called on major cargo owners, including the Dangote Group, to support local fleet development by offering long-term Contracts of Affreightment (CoAs) for petroleum products, cement, fertiliser and other bulk cargoes.

The shipowners argued that cargo is the foundation of the shipping industry, while predictable long-term contracts are essential for securing financing and acquiring vessels.

The call was made by former Nigeria Chapter President of the African Shipowners Association and Group Managing Director of Seamate Maritime Integrated Services Limited, Capt. Ladi Olubowale, at a Public-Private Dialogue with CEOs organised by the Nigerian Chamber of Shipping in Lagos.

The dialogue, themed “Unlocking Efficiency in the Marine and Blue Economy Value Chain,” brought together maritime industry stakeholders, including Dangote Group’s Group Vice President, Oil and Gas, Edwin Devakumar, who attended as the guest CEO.

Olubowale said Nigeria’s maritime strategy should move beyond discussions about vessel ownership and focus on creating commercial conditions that would make the acquisition of vessels by indigenous operators financially viable.

“Give credible Nigerian shipowners long-term Contracts of Affreightment, and those contracts become the commercial foundation upon which vessels can be financed, acquired and deployed,” he said.

He noted that shipping is capital-intensive and that Nigerian shipowners would struggle to acquire large vessels sustainably without guaranteed cargo volumes and bankable employment contracts.

According to Olubowale, Dangote’s refinery, cement and fertiliser operations generate significant maritime cargo volumes, placing the group in a position to support local fleet growth by allocating part of its cargo requirements to qualified indigenous operators through multi-year CoAs.

He said such agreements would give Nigerian shipowners the predictable revenue needed to approach commercial banks, development finance institutions, export credit agencies and international financiers for vessel acquisition funding.

Olubowale also expressed concern over the dominance of foreign-controlled vessels in transporting Nigerian crude from terminals including Forcados, Bonny and Escravos, arguing that substantial freight revenues generated from Nigerian cargo were being earned by foreign operators.

He said the focus should be on converting the movement of Nigerian cargo into domestic assets, jobs, technical expertise and long-term economic value.

“There is no structural reason why Nigerian companies should not ultimately own and operate Suezmax tankers and other large commercial vessels. But fleet development must be connected to cargo, finance, technical capability and long-term employment,” he said.

The maritime executive proposed a four-pillar model for fleet development — Cargo, Contract, Finance and Vessel. Under the model, cargo owners would provide predictable volumes, CoAs would create bankable contracts, financiers would support vessel acquisition, while Nigerian shipowners would provide the vessels and related services.

Olubowale said the proposed model would complement existing government interventions such as the Cabotage Vessel Financing Fund rather than replace them.

He stressed that government should primarily serve as an enabler, regulator and facilitator, while the private sector drives the commercial side of fleet development.

“Nigeria’s ambition to build a globally competitive marine and blue economy will require deeper collaboration between cargo owners, indigenous shipowners, banks, investors, ports regulators and government,” he said.

Olubowale added that growing intra-African trade under the African Continental Free Trade Area would increase the importance of maritime transportation, making it necessary for Nigeria to deliberately leverage its large cargo base to develop a sustainable indigenous shipping industry.

“The maritime industry must ultimately be driven by the private sector. If we connect Nigerian cargo to Nigerian maritime capacity, we will not merely acquire ships — we will build a sustainable shipping industry,” he said.