We’ve paid N880.6m to FG as rent for Tarkwa Bay land in last two years – LADOL
The LADOL Free Trade Zone said it has been compliant with the landlord-tenant agreement with the Federal Government through the Nigerian Ports Authority (NPA), and has paid a total of N880.6 million in the last two years as full rent.
LADOL, which had been fully operational for eight years now, is one of the few wholly privately developed NPA’S terminals and a beacon that attracts private sector investment.
Oladipo Jadesimi, chairman of LADOL, who disclosed this in a statement, said this was contrary to claims that the Federal Government is not getting full value from its land at Tarkwa Bay, where LADOL Free Zone is situated.
Jadesimi said the alleged lease of part of LADOL’S land to Samsung Heavy Industries Nigeria Limited, which was recently terminated, would have halved FG’S income from the LADOL area to N230.3 million – the amount said to have been charged Samsung.
According to him, the Vice-president Yemi Osinbajo not only highlighted the role of LADOL in economic development on 10th August 2018, when he toured LADOL Free Zone, but also commended stakeholders in LADOL for continued private investment and local content drive.
Speaking during the Vice President’s visit, Hadiza Bala Usman, managing director of NPA, said that the successful berthing of Egina FPSO was as a result of operational efficiency and very robust synergy between the NPA, LADOL and other stakeholders.
While the Managing Director of Shell confirmed that his company had gained 40 percent cost savings from working with LADOL, saving Nigeria hundreds of millions of dollars, and helping to make Shell’s investments in Nigeria internationally competitive.
On the controversial FPSO integration yard, Jadesimi said that LADOL, which has invested hundreds of millions building the Zone for 19 year, needs government’s protection after putting USD$40.5 million as part payment for the construction of the Total’s Egina FPSO integration yard in LADOL.
“Samsung has not invested in the yard, a view the Federal Government of Nigeria (FGN) strongly holds and has expressed. Therefore, attempt to allocate the land on which the shipyard stands is tantamount to a gift to Samsung of a strategic asset belonging to the Nigeria, being a legacy of the multi- billion dollars national investment made into the Egina field development,” Jadesimi said.
He explained that “Total contract awarded to Samsung was about USD3.2 billion for engineering, procurement, and construction of the Egina FPSO. Samsung was given the sum of USD214 million for the construction of the Yard, which is in addition to the USD40.5 million from LADOL.
Jadesimi however stated that Nigerian government is supposed to reimburse Total’s payments to Samsung, making government the primary investor in the yard.
“Investors in the yard are LADOL, its stakeholders and the Nigerian government. Samsung was a contractor and a tenant of LADOL, not an investor in the yard. The yard itself is an important local content legacy development and key benefit left in Nigeria from the Egina project.
He described the initial sublease agreement between LADOL and Samsung, which was approved by NPA in a letter dated 12th March 2014, as ‘willing seller willing buyer’ relationship entered into as local content plan for the Egina project.
“Though, LADOL was entitled to collect the contracted income from that sublease – they did not, instead allowing Samsung to hold back 90 percent of the rent due, USD40.5 million for construction of the yard. Leaving LADOL with USD4.5 million for five years, amounting to USD900,000 per year,” Jadesimi said.
He noted that NPA has been a fair and just landlord that protects the rights and investments of its tenant, LADOL, adding that NPA has also played a significant role in leveling the playing field in the maritime, industrial and petroleum sectors – ensuring that all Nigerian companies can participate.