The impact of the Lekki Deep Sea PortOctober 28, 2022
Oseni Oluwaseun, CEO and managing director of Glenstar & Knots Holding, talks to The Energy Year about the impact of the Lekki Deep Sea Port and the security of Nigerian waterways. Glenstar & Knots Holding is a West African company involved in ship-to-ship cargo transfer operations, river pilotage, vessel berthing and unberthing operations.
Can you give us an overview of Glenstar & Knots Holding’s company structure and main activities?
Glenstar & Knots Holding is a holding company which comprises several sub-companies. Glenstar Marine is the STS [ship-to-ship] company and Knots Global provides vessels for marine logistics services, while Knots Shipping represents our strategy of moving into the cargo business. With Knots Global, we own three vessels.
Regarding our activities, we have the standard contracts and the spot operations. Spot operations are the ones where past clients call us to deliver a single operation within a larger scheme. They give us elasticity and continuous market visibility and thanks to this, we work with all of the companies in Nigeria.
Contracts are prolonged engagements and demand a complete set of services. We are currently working for TotalEnergies, and we are one of the few STS companies approved by them. We also provide STS services for Prudent Energy, Sahara Group and NNPC.
What is your strategy regarding fleet expansion?
The vessel management system in Nigeria is expensive and complicated. Policies constantly change, and it is challenging to keep up from a business standpoint. The biggest challenge regarding vessel management is the maintenance of these assets because we don’t have spare parts available within the domestic market.
What are the expected impacts of the Lekki Deep Sea Port on your STS services?
The Lekki Deep Sea Port is being built in the Lagos Free Trade Zone, and it will allow larger vessels to come and berth in Nigeria. It is a fantastic opportunity for our country because it will make the trade of products cheaper and faster, and our marine operations will be more efficient. Nonetheless, STS services were undermined because, until now, big vessels were staying outside while smaller boats were coming back and forth with PMS [premium motor spirit].
What has been the rationale behind the establishment of Knots Shipping?
Business is about diversification and a company’s ability to adapt to the market. In 2020, we were approached by a company to transfer containers for some clients. We managed to acquire the necessary knowledge and assets to deliver the job, and we delivered it successfully. Having done so, we realised the enormous potential of the cargo business in Nigeria.
We are a country that relies massively on imports and exports for its survival. Historically, we dealt with the trade of liquid cargo via STS, and we understood that we had a serious possibility to expand into other commodities. We managed to create another source of income, and we are satisfied with how this business is coming up.
How would you evaluate the security of Nigerian waterways?
We have a situation in our waterways regarding acts of piracy. Most of these episodes occur deep offshore, and it begs the question of how it is possible that pirates know the exact position and trajectory of the vessel. This information is possessed only by the company operating the vessel and the crew; one way or another it leaks.
We need to understand that perpetrators of criminal acts are normal people that feel entitled to take advantage of our resources. We must offer an alternative source of living to these people through regular employment. As Glenstar Marine, we never had piracy issues because we know where and how to operate, and we trust our crew.
What is Glenstar & Knots Holding’s growth strategy?
Soon, we plan to thoroughly structure our holding group to streamline our operations. We have a name now, which is Glenstar & Knots Holding, and it is a significant milestone for our companies. We have a base in Côte d’Ivoire and Lomé, and we are also trying to get fully established in Ghana.
We plan to enter an untapped market, gas STS. It will be an effective service for the future, especially for the Decade of Gas. In the long run, we see ourselves as the largest STS company globally.