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AP Moller Removes MD over Apapa Port Congestion, Gridlock

Tuesday, 17 March 2020 | 16:00

AP Moller’s parent company in The Hague, Netherlands, has fired the Managing Director of its Nigerian subsidiary, AP Moller Terminals (APMT), Mr. Martin Jacob, THISDAY’s investigation has revealed.

THISDAY gathered that his removal was to avoid the takeover of the company’s terminal in Nigeria by the Nigerian Ports Authority (NPA) following the expiration of the 30-day ultimatum given to APMT to address inefficiency at its terminal, which has resulted in port congestion and gridlock in Apapa.

It was learnt that the decision to remove Jacob was disclosed by a powerful delegation from The Hague, led by the company’s global Chief Operating Officer (COO), Mr. Keith Svendsen, at a recent meeting with the top management of the NPA led by the Managing Director, Ms. Hadiza Bala-Usman.

Jacob, it was learnt, would be replaced by Mr. Klaus Laursen, who was until his appointment, the Managing Director of APMT’s Poti Sea Port Corporation, the largest port in Georgia.

It was gathered that the Poti Sea Port is a major seaport and harbour off the eastern Black Sea coast at the mouth of the Rioni River in Poti, Georgia.

The Poti Sea Port handles liquids, dry bulk, passenger ferries and 80 per cent of Georgia’s container traffic.

The port, it was learnt, also serves as a European gateway for international trade in Georgia, Armenia and Azerbaijan, and is ideally located to become a hub for Central Asia trade.

A source privy to the meeting held at the NPA head office in Lagos told THISDAY at the weekend that the delegation, which was in Nigeria to plead with the NPA, was displeased with the running of its Nigerian operations.

The source said the delegation accused Jacob of running the company’s operations in the country below its global standard, thereby causing congestion in Apapa port, as well as gridlock on the roads.

“They (the delegation) expressed disappointment with the state of their terminal in Apapa, saying it does not meet the AP Moller’s global standard and that it runs like a local operation.

“The COO told NPA officials that they are sending a new MD for Apapa terminal. He gave his name as Mr. Klaus Laursen – someone with decades of international experience. The COO said he is one of the best they have in all the company’s 72 terminals worldwide,” the source explained.

The source quoted the COO as saying that while Laursen is finishing his visa formalities to come to Nigeria, the company’s Chief Executive Officer for India, Middle East and Africa Terminals, Mr. David Skov, will be on ground in Nigeria to share performance metric directly with the NPA.

THISDAY gathered that following these developments and the assurances given by the company’s team from The Hague, NPA has extended the ultimatum by an additional 90 days to review the company’s progress, starting from the middle of April.

The NPA had last month written AP Moller’s parent company expressing its frustration about the inadequacy of cargo handling equipment at APM Terminals.

But apart from the removal of the MD, the COO was said to have made other promises on yard improvement and massive investment in cargo handling equipment to ease the congestion and Apapa gridlock.

With these developments, NPA has suspended its plans to take over the operations of the firm and gave it another 90 days to improve its performance.

As part of the measure to ensure compliance, the NPA will storm the terminal in the middle of April for a thorough inspection.

THISDAY had exclusively reported that the NPA planned to take over the operations of APMT last week after the expiration of the 30-day ultimatum given to the firm by NPA to address inefficiency at its terminal, which has resulted in port congestion and gridlock.

The NPA had also threatened that it would not hesitate to bring to fore the non-compliance clause in the 2006 port concession agreement to protect the interest of the port users.

The clause empowers NPA to take over the operations of APM in the event of its failure to meet the terms of the concession agreement.
APMT is the biggest container terminal in West Africa with an annual capacity of 1.2 million TEU (Twenty-foot Equivalent Unit).
APM Terminals took over the concession at Lagos’ Apapa Container Terminal in 2006.

THISDAY’s investigation revealed that the NPA decided to take action following complaints by customs agents, importers and major stakeholders in the maritime industry who warned that the congestion at the port, if not addressed urgently, could lead to emergencies that the federal government might not be able to handle.

Also, there has been a huge outcry over post-cost and demurrages as a result of the Apapa gridlock, which the clearing agents claimed is deliberately been fuelled by APMT for their selfish interest.

Consequently, the NPA in a letter dated, January 24, 2020, warned APMT that it would no longer tolerate delays in berthing vessels at the firm’s terminal, which the NPA said has resulted in vessels waiting at anchorage for 25 days or more to discharge cargo.

This delay, the NPA stated, was mainly attributed to the poor state of APMT’s cargo handling equipment and other infrastructure deployments in its terminal.

This development, NPA added, negates some of the fundamental problems the port concession policy was intended to address, namely: congestion and delay in turnaround time as emphasised by the International Maritime Organisation (IMO) and several conventions to which Nigeria is a party.

When contacted on these latest developments, customs agents applauded the NPA, stressing that terminal operators were taking Nigerians for granted because no action had been taken against them before now.

The President of the National Association of Licensed Customs Agents (ANALCA), the umbrella body of customs agents in the country, Mr. Tony Iju Nwabunike, said the removal of the MD would serve as a deterrent to others.

While hailing the moves by NPA to take over the operation of APMT, he said: “I think the NPA is trying to let them know it is no longer business as usual. The NPA is concerned with the congestion and is determined to do something about it. You can see what has happened now. The company has been forced to take action.”
Source: This Day Live

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