Recently, the Osubi Airstrip in Warri was shut down for some weeks. In this piece, ANTHONY AWUNOR, looks at the events that led to the closure and implications for users of the airstrip.
Over the years, Osubi Airstrip has played the role of a major airport serving the city of Warri in Delta State. The airstrip is the only transportation link into Warri city by air because of its status as an oil producing city. Traffic flow into and out of Osubi airstrip is one of the highest in the country because of the strategic location of the town.
Due to the high traffic Osubi airstrip takes daily, Nigerians were surprised when it was shut down on 3rd September, 2018 after the Nigerian Airspace Management Agency (NAMA) withdrew its navigational services due to debts owed it by the management of the airport, Shoreline Oil Services Ltd.
With the withdrawal of its services for some weeks, the two major airlines to the Osubi Airstrip, Aero and Arik Air are said to have incurred huge sums of revenue loss within the period.
Apart from the parties directly affected, Aviation Round Table (ART) was one of the groups that fired the first salvo, accusing NAMA of closing the airstrip.
In an official statement issued expressly by the professional group, they reminded anyone who cared to listen that the airport started as a hub for non-scheduled and charter operations and has grown to providing scheduled services which has eased pains of passengers flying to Warri and other neighboring cities tremendously while growing the Nigerian economy in general, Delta state in particular.
The think tank group in the statement signed by one of their key members, Olu Ohunayo, therefore stated that they are of the opinion that the airport be certified by NCAA to operate scheduled flights and its tariffs approved accordingly in line with Nigeria Civil Aviation Regulations ( NCARs ).therefore, recommended that the airport be certified by the Nigeria Civil Aviation Authority (NCAA) to operate scheduled flights and its tariffs approved accordingly in line with Nigeria Civil Aviation Regulations (NCARs).
Their conjecture was that, there should have been an agreement between NAMA and the operators of Warri airport on tariffs before the deployment of air traffic services.
But unknown to the professionals, NAMA as an air navigation service provider had a robust monthly payment arrangement with the operators. For instance, evidences abound that the service provider had agreement with the initial operator- Shell Petroleum Development Company of Nigeria for the latter to pay seventeen million, six hundred and sixty-six thousand (N17, 660, 000) monthly for service fees as Air Traffic Management Services Agreement (ATMS).
This agreement was further accentuated in a letter written by Shoreline Oil Services limited to SPDC, confirming that the company had investigated and discovered that NAMA’s claims of which there is an agreement for SPDC to pay N17, 660, monthly for service fees as Air Traffic Management Services Agreement (ATMS) was valid.
The letter dated 26th April, 2016 and signed by a Director with Shoreline Oil Services limited, Kola Karim leaves no one in doubt that there exists an agreement between the former operator-SPDC and NAMA.
Shoreline Oil Services limited in the letter, however, stated that when SPDC divested from Osubi Airport it only made available a contract which was for the sum of N2, 976,583. 00 as monthly fee from NAMA, insisting that it was the responsibility of SPDC who no longer handles the airport to bear the cost of the differential.
Reports also indicate that the service fees charged from 2009 was N18, 543,517 monthly but because SPDC was paying N17, 660,600 monthly the agency (NAMA) was collecting same being a cost recovery agency.
The letter from Shoreline Oil Services Limited which was addressed to the Financial Director (Nigeria and Gabon), Shell Exploration and Production Africa and read in part:
“Our investigation regarding NAMA’s claims of the existence of agreement between itself and SPDC Ltd on behalf of itself and partners (SPDC) upon which they asserted that there is an agreement to pay a monthly service fee of N17, 660, 000 ( seventeen million, six hundred and sixty-six thousand) under an Air Traffic Management Services Agreement (ATMS). NAMA has provided evidence of SPDC’s payment.”
“However, when SPDC decided to close out/divest interest in Osubi Airstrip and at the time of our acquisition in 2015, the only information SPDC made available to us was a contract (Contract NGO1002424) which expired 30th June 2012 for the sum of N2, 976,583 as monthly fee to NAMA.”
“Therefore, as there exists a contract of performance by SPDC with NAMA, SPDC has the responsibility to bear the cost of the difference between the N2,976,583 which was disclosed in the contract made available to us as at the completion of the sale transaction and the non-disclosure of payment of N17, 660, 000 as monthly fees to NAMA.”
From the content of the above communication, one may be tempted to conclude that, a payment agreement in the sum of N17, 660, 000 as monthly fees to NAMA was entered into. It is also possible that perhaps, due diligence may not have been followed completely before the SPDC/ Shoreline Oil Services limited deal was sealed.
The situation described above is actually the last straw that broke the camel’s back since the new operator- Shoreline Oil Services limited, now feels it is ensnared to bear the brunt of the former’s indebtedness which is the difference between N17, 660, 000 and N2, 976,583.
It is therefore, very clear that the recent closure of Osubi Airstrip is not the making of NAMA but due to persistent refusal of the operator to honour its financial obligation to NAMA despite several entreaties. The issue of exploitation does not also apply in the case of Osubi Airstrip as NAMA offers the same air traffic services to Escravos, Forcados, Bonny, Eket, Gombe, Jalingo, Asaba, Uyo among others who have faith with their agreements. There is nowhere in the world where air traffic services are free.
Meanwhile NAMA has restored air traffic services at Osubi airstrip with the hope that Shoreline Oil Services Ltd would pay up its debt balance of N566, 422, 000.50 as at 28th October, 2018.
According to NAMA in a statement announcing the restoration of services signed by the General Manager, Public Affairs, NAMA headquarters in Lagos, Khalid Emele, the reopening is consequent upon the payment of N31 million by Shoreline Oil Services Ltd, being part payment of accumulated charges for the provision of air traffic services at the airstrip by NAMA.
At the moment, NAMA remains the only agency approved by government to deploy air traffic controllers to airports across Nigeria. That does not however, give NAMA the statutory powers to close down any airport as insinuated in some quarters.