THE MAGAZINE OF THE WORLD’S SHIPMANAGEMENT COMMUNITY ISSUE 33 SEPTEMBER/OCTOBER 2011

COVER STORY FIRST PERSON

14 Roberto Galli The current Executive Vice Training & Crew Retention President of Syndarma (the association for Brazilian flag ship owners in Brazil) usually p34 High seas has his finger on the pulse of what is happening, especially in turning high- Rio de Janeiro, his home town tech SHIPMANAGEMENT FEATURES 18 How I Work SMI talks to industry achievers and asks the question: How do you keep up with the rigours of the shipping industry? 29 Insider 8 STRAIGHT TALK - Forewarned then forearmed Denis Petropoulos, Executive Director of Braemar Shipping NOTEBOOK Services plc 10 Industry bodies call for armed 12 Pancoast hangs out for FMM 74 The Bucket List guards soft loan Prominent shipping Ship owners and managers have voiced Brazilian-based offshore operator professionals share their their concern over a lack of any real Pancoast Trading has finally seen some personal and business progress in resolving the piracy issue movement at the Brazilian Fundo de ambitions with SMI Mercante Marinha which will lead to a 10 Managers request voice in soft loan for the company allowing it to piracy proceedings proceed with a newbuilding programme MARKET SECTOR Crew managers have hit out against a 12 Shipping confidence dips to 24 Technically sound lack of input when it comes to piracy all-time low negotiations Leading technical management Overall confidence levels in the shipping providers explain how the 11 Owners reluctant to end industry fell to their lowest level for three crewing shortage and advances shipmanagement contracts and a half years in the three months ending in technology are impacting on August 2011, according to accountant and their services The threat of expensive termination fees, shipping adviser Moore Stephens against a backdrop of continued low freight revenues, means high costs when 34 High seas turning changing shipmanagement provider 13 AKD warns Dutch ship owners high-tech against hiring armed guards A “digital revolution” is almost 11 Creating capital by cutting Ship owners who hire armed guards could upon the shipping industry as carbon face criminal prosecution, leading Dutch the sea plays catch up to land- based technology and seafarers Shipping industry professionals debated law firm AKD has warned following the release of a report recommending greater demand broadband and high- the challenges facing clean-tech and tech communications devices renewable energy at the Creating Climate protection against piracy for the Dutch merchant fleet Wealth summit in London 66 Lightening the load As the economic downturn continues to influence NEWBUILDING decisions over building projects worldwide, wise players within the heavy lift 73 Bold owners, determined yards make the running sector are adapting to take Coupling an evidently keen price with a track record in passenger ship construction, MHI advantage of growing recently signed a memorandum of understanding with Carnival Corporation covering two opportunities in wind, mining 125,000gt cruise vessels destined for the US group’s German brand, AIDA Cruises and offshore

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 5 DISPATCHES BUSINESS OF SHIPPING

30 Grappling with a ‘bittersweet’ solution 80 AdHoc The shipping industry has become the first to introduce Greenwich Maritime Institute plans Masters degree in security mandatory global greenhouse gas emission standards. The Prolonged high yen is affecting Japanese ship managers principle of extending enforceable environment protection rules Goltens offers a safe solution to the high seas meets one of the crucial calls made by the world’s top marine scientists Save our Seafarers campaign hits 20,000 mark India cracks down on old ships IBF reaches three-year pay settlement REGIONAL FOCUS Australian shipping incidents down between 2005 and 2010

40 Harbouring success through prosperous ports SHIP REPAIR The ability of Belgium and The Netherlands to survive what is the worst shipping crisis to hit for decades will rely as much on prosperity in the world’s main producing areas like the Far East as 70 Conversion contract for Lloyd Werft well as its determination to remain committed to what it does best Germany’s Lloyd Werft (Bremerhaven), one of northern Europe’s main exponents of the refurbishment and conversion industry, is to 48 Strategic focus on higher added-value sectors convert Harren & Partners’ heavy lift vessel Combi Dock IV into a specialised OSV As a country with extremely limited natural resources, South Korea has made its way in the world through unerring industrial endeavour and exporting achievement - Oman Drydock opens for business - MMHE continues its growth in the LNG tanker TRADE ANALYSIS repair market

45 The truth behind China’s VLCC ordering plans REVIEW The tanker markets were reported to have been spooked in early September by the rumour that Chinese oil companies may order 88 Books up to 80 VLCC newbuildings from Chinese yards Giants of the Sea by Joachim Pein Jerusalem: The Biography by Simon Sebag Montefiore 46 Stemming the flow Mercy by Jussi Adler-Olsen The Zero Point Conspiracy by Donald Crighton It was almost a case of déjà vu when Frontline’s Chief Executive Jens Martin Jensen was quoted in the maritime press in the middle of August claiming that owners in the very large crude carrier Music market should take a $500 million gamble and scrap 50 older Superheavy: Superheavy double-hull vessels in order to help ease oversupply in this sector Cleo Laine: Jazz Red Hot Chili Peppers: I’m With You ECOVISION Festival JZ Shanghai Music Festival 58 Prevention is better than cure Theatre The American Salvage Association tells SMI about the importance Backbeat Duke of York’s Theatre, London of salvage as a preventative measure in environmental protection Art 62 Vessel operations: With all the trimmings Picasso: Masterpieces from the Musée National Picasso Finding a vessel’s optimal trim – the difference between the ship’s forward and after drafts, and particularly its effect on its Dining manoeuvrability – can provide better speed and lessen fuel Alinea: Lincoln Park, Chicago consumption Wines 64 Greenshoots German wines get serious

LIFESTYLE BUSINESS VIEWPOINT 92 What smart homes are wearing - in the bowels of 55 Counteracting the elements the earth Six Britons in a small boat-cum-sledge this summer braved ice It’s official: home interiors is the new porn. Like voyeurs seeking floes and polar bears to voyage 450 miles to the magnetic North after lustful thrills and titillations, we allow an increasing number Pole, from Resolution Bay in the Northwest Territories of Canada of TV programmes to let us into great and grand designs for living 94 Shaken, not slurred? LIVE Aston Martin’s vehicles are as conspicuous as they are classic but how will life-long fans of the brand react to it’s microcar creation, 85 Objects of Desire Things that make you go oooh! the Aston Martin Cygnet?

6 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011

STRAIGHT TALK

Welcome to Ship Management International

September/October 2011 Issue No. 33

www.shipmanagementinternational.com The shipping business magazine today’s owners and managers have been waiting for

Published by Forewarned then

Elaborate Communications Acorn Farm Business Centre, Cublington Road, Wing, Leighton Buzzard, Bedfordshire LU7 0LB forearmed United Kingdom Sales/Accounts +44 (0) 1296 682241/682051 f there is one thing the shipping industry is But such efforts must go hand-in-hand with Editorial +44 (0) 1296 682356 Fax: +44 (0) 1296 682156 good at, it is being seen to be singing from the co-operation of the navies and must be Email: [email protected]/[email protected] the same hymn sheet when it has finally sanctioned at the highest level. You cannot co- www.elabor8.co.uk I had enough of banging its head against the operate enough to save seafarers’ lives. Ship Management International Editorial Board proverbial wall of international obduracy. With a headcount of at least 166 private Rajaish Bajpaee (Bernhard Schulte Shipmanagement) Before it was the unfair criminalisation of security companies seeking the attention and the Kuba Szymanski (InterManager) Nigel Cleave (Videotel Marine International) the Hebei Two; this time it is a united call for wallets of the world’s ship owners and Andreas Droussiotis (Bernhard Schulte Shipmanagement) the use of armed guards onboard those ships managers, it is hardly surprising that the use of Dirk Fry (Columbia Shipmanagement) Sean Moloney (Elaborate Communications) transiting the pirate infested waters of the Gulf armed guards is dominating the headlines. Yes of Aden. Okay, the plea by the world’s ship no ship with an armed guard has so far been Editorial Director: Sean Moloney Deputy Editor: Helen Jauregui owners delivered under the auspices of the attacked, but according to Capt Keith Blount Journalist: Samantha Giltrow International Chamber of Shipping and its from EUNAVFOR, it is only a matter of time Editorial Support: Debra Munford Regular Contributors: Margie Collins fellow Round Tablers, was for the global before this statistic is overturned. Michael Grey James Brewer community to sanction the use of a United As he told a recent International Chamber Thomas Ország-Land Martin Conway Nations force of armed military guards to be of Shipping conference is London, “I believe it Robert Ward deployed onboard ship to tackle the piracy crisis is only a matter of time before a ship with a Paul Bartlett Technical Editor: David Tinsley in the Indian Ocean, which it says is spiralling private security team onboard is taken Advertisement Director: Jean Winfield Advertising Sales: Karen Martin out of control. While in a separate move, successfully by pirates.” The military, he says, is Accounts: Sarah Newman Design and layout: Michael Argles InterManager launched its own campaign to entirely agnostic to private security teams and Editorial contributors: allow owners and third party managers the allows shipping companies to make their own The best and most informed writers serving the global freedom of choice when it comes to employing decisions. But from a military perspective it is a shipmanagement and shipowning industry. armed guards onboard those ships they manage. dangerous place operating in the Gulf of Aden, Admirable moves indeed, borne almost he claims, and it is even more dangerous when Ship Management International is published six times a certainly out of a desperation because as the you don’t know if the pirate-infested ship you year and is entirely devoted to reporting on the dynam- ic and diverse in-house and third party monsoon season in the region comes to an end, are approaching has armed guards onboard or shipmanagement industry. pirate attacks will almost certainly start to not. Subscriptions UK and ROW – 1 year: £120 ($180); escalate. The industry call for an organised So putting the well-being of the seafarer 2 years: £200 ($300). armed guard solution is also understandable first, co-operation and understanding on the Download a subscription form from www.shipmanagementinternational.com or when you consider that the combined might of issue of armed guards is needed. Flag states Send subscription enquiries and/or address the world’s navies in patrolling the area is akin, need to understand their obligations and corrections to: as one naval expert described it, to an area the hammer out a solution with the owners and Elaborate Communications, Acorn Farm Business size of western Europe being patrolled by four managers and the world’s governments need to Centre, Cublington Road, Wing, Leighton Buzzard, Bedfordshire LU7 0LB, United Kingdom. police cars. And the recent public airing in the start thinking about a credible solution that Tel: +44 (0)1296 682051/682241/682403 press by two of the world’s largest ship resolves the Somalia crisis once and for all. But

Printed in the UK by Warners Midlands plc. Although every effort managers – V.Ships and Anglo Eastern – of their for the time being, if armed guards are necessary has been made to ensure that the information contained in this publication is correct, Elaborate Communications accepts no feelings of frustration and helplessness in being to protect lives at sea, then they should be responsibility or liability for any inaccuracies that may occur or eased out of the hostage negotiation processes deployed but with the agreement of all. their consequences. The opinions expressed in this publication are not necessarily those of the publishers. All rights reserved. No part when their crews are captured, is also of this publication may be reproduced whole, or in part, stored in a retrieval system or transmitted in any form or by any means symptomatic of a growing gulf between what without prior permission from Elaborate Communications. the owners want and what the managers want when it comes to getting their prized assets Approved and Supported by back. Sean Moloney

8 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011

NOTEBOOK

SHIPMANAGEMENT NEWS AND REPORTS FROM AROUND THE WORLD Industry bodies increase call for armed guards hip owners and managers have voiced a meaningful contribution in the area of their concern over a lack of any real counter-piracy.” Sprogress in resolving the piracy issue The InterManager campaign, which has by calling for armed guards to be allowed received more than 90% of support from its onboard ships transiting pirate-infested member companies, will lobby flag states and water. charterers to change their rules relating to The global shipping industry armed guards onboard ship. (represented by the Round Table of It claims that any decision taken to arm a international shipping associations) has ship should be based on a robust risk called for the establishment of a United assessment of each vessel and its situation Nations force of armed military guards to and should be unhindered by restrictive Flag tackle the piracy crisis in the Indian Ocean, State legislation. which it says is spiralling out of control. The shipping industry organisations – Industry pressure for greater protection While in a separate move, InterManager which represent more than 90% of the world of ships transiting danger areas such as the launched its own campaign to allow owners merchant fleet – say they fully support the Gulf of Aden has grown following concerns and third party managers the freedom of UN’s long-term measures onshore aimed at over the effectiveness of navies operating in choice when it comes to employing armed helping the Somali people but are concerned the area. Latest industry statistics suggest guards onboard ships they manage. that these “may take years, if not decades, to that since 2008, more than 3,500 seafarers In a hard hitting letter to UN Secretary- have a meaningful impact on piracy.” have been captured by pirates with around 60 General Ban Ki-Moon, the International Asking the UN to bring the concept of a dying as a result of their captivity. Chamber of Shipping (ICS), BIMCO, UN force of armed military guards to the InterManager, whose members include crew INTERTANKO and INTERCARGO attention of its Security Council, the letter managers, is keen to give all support possible demanded a “bold new strategy” to curb added: “The shipping industry believes that to protect its seafarers from the mental and rising levels of piracy which have resulted in the situation can only be reversed with a bold physical torture, degrading treatment, food the Indian Ocean resembling “the Wild approach that targets the problem in deprivation and dehydration that those held West”. manageable pieces. We believe that an hostage suffer. The letter stated: “It is now abundantly important element in this approach would be InterManager believes the industry needs clear to shipping companies that the current the establishment of a UN Force of Armed to work harder with those entities such as flag situation, whereby control of the Indian Military Guards that can be deployed in small administrations, oil majors and bulk Ocean has been ceded to pirates, requires a numbers onboard merchant ships. charterers who prohibit owners from bold new strategy. To be candid, the current “This would be an innovative force in protecting their assets as they believe they approach is not working.” terms of UN peacekeeping activity but it should be protected. Regretting the increasing necessity for would do much to stabilise the situation, to Alastair Evitt, InterManager President, shipping companies to employ private armed restrict the growth of unregulated, privately said: “At the end of the day it is the welfare guards to protect crew and ships, the letter contracted armed security personnel and to of our crew members and their families that stressed: “It seems inevitable that lawlessness allow those UN Member States lacking is at stake and there cannot be too many ashore in Somalia will continue to breed maritime forces – including those in the initiatives running in parallel to address this lawlessness at sea.” region most immediately affected – to make disgraceful situation.”

position as key representatives on the Managers request voice in seafarers’ side. While both Mr Cremers and Mr Giorgi noted that owners face a tough task in piracy proceedings negotiating the safe release of their vessels and crew, they highlighted that the interests hip managers have hit out against a Roberto Giorgi, President of V.Ships of seafarers are not being properly lack of input when it comes to piracy and Peter Cremers, Chief Executive of addressed. They argued that while owners Snegotiations, complaining that ship Anglo-Eastern Ship Management, both and insurers hold a definite financial management companies have no voice when went to the press stating they felt incentive in the release of cargo and vessels, it comes to securing the safe release of helpless during hostage negotiations as other stakeholders, including managers vessels on which their own crew are held. shipowners and insurers maintain their should play a role in the proceedings.

10 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 NOTEBOOK

Owners reluctant to end shipmanagement contracts

hip owners could find themselves costs involved; it can cost between some money afterwards to maintain the increasingly locked into existing $100,000 and $150,000 to change manager level of quality. Sthird party shipmanagement and new managers will have different ideas “We are working hard to keep costs contracts as the threat of expensive to old managers. An owner wishing to down and this is appreciated by owners. termination fees, against a backdrop of switch management contracts would also This is something you can do if you have continued low freight revenues, mean the have to pay a termination fee so I do not good management onboard; you can costs of changing management provider think anyone will terminate their operate the ship well for some time yet still could prove too high. management contracts during this period.” cut back to bare bone but you then need to Lars Modin, President of the V.Ships- The major issue facing ship managers, know that you will have to spend some owned International Tanker Management, he said, was dealing with ship owner money afterwards again to bring it up to the said the market for ship managers was demands to force down management fees. acceptable standard. slowly increasing as more deliveries started “But this is proving very difficult when it “We haven’t seen any owners suffering to come out of the world’s shipyards and comes to managing ships with a certain to the extent that they have to get rid of their owners erred away from terminating quality and a certain cost.” ships. I don’t foresee any of my clients existing management contracts. However, according to Lars Modin it is doing that. But with more ships coming out He told SMI: “For the next six to 12 possible to cut vessel operating expenses to of the yards we are taking over more months, the number of ships needing to be the bare bone for a year or so but only if you newbuildings now although many owners managed will increase. No one is looking have a robust management procedure are trying to postpone delivery times,” he to change their managers because of the onboard ship and if you agree to spend added. Creating capital by cutting carbon

he shipping industry’s attitude The Carbon War Room – an initiative are representatives with technologies which towards climate chaos has always which connects entrepreneurs to create are not being bought or are sitting on the Trecognised the financial incentives market-driven solutions to climate change, sidelines – the idea is how to get money of fuel reductions but now, Europe’s first the summit worked to highlight market moving around the right mechanisms.” Creating Climate Wealth summit has barriers – particularly those which reinforce furthered this approach by assessing how the status quo and so, prevent sustainable renewable energy and clean-tech solutions solutions from gaining financial backing. can be harnessed to maximise wealth- Peter Boyd, Chief Operating Officer of creation strategies across the industry. The Carbon War Room, said: “Although Held at University College London on policy is often part of the solution, we want 13th and 14th September, the Creating to make sure it is actors in the room who are Climate Wealth summit brought together going away able to act differently, rather professionals from the shipping industry than saying that so long as Washington sorts and beyond to discuss the challenges facing it or Canberra sorts it, everything is good. the clean-tech and renewable energy Policy, capital and technology all need to sectors, while encouraging debate as to how come together in a working marketplace to to best overcome these unique challenges. solve climate change. Arguably policy is a Presented by The Long Run Venture, necessary but insufficient condition to get which helps businesses to deliver faster things done and technology isn’t commercial returns from sustainability, and necessarily the bottom end – I’m sure there

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 11 NOTEBOOK

Pancoast hangs out for Shipping FMM soft loan confidence dips razilian-based offshore operator discovered that the extra delays (and Pancoast Trading has finally seen indeed the delays in the FMM meeting in to all-time low Bsome movement at the Brazilian the first place) are/were due to the Fundo de Mercante Marinha (FMM, or wholesale firing of various officials within verall confidence levels in the Merchant Marine Fund) which will lead the Ministry of Transport and FMM. shipping industry fell to their to a soft loan for the company allowing it Brazil’s President Dilma Rousseff Olowest level for three and a half to proceed with a newbuilding fired transport minister Alfredo years in the three months ended August programme. Nascimento back in July, and various of 2011, according to the latest shipping However, Mario Froio, Managing his cronies have been forced out of the confidence survey by leading Director of Pancoast, the Brazilian ministry since then. accountant and shipping adviser Moore subsidiary of Greek shipping line With contracts already signed with Stephens. Fears about overtonnaging, Krontiras, told SMI that his company was state controlled oil company Petrobras, and and continuing uncertainty about the still facing some “unfortunate bureaucratic the Rio Nave shipyard (ex-Caneco) in Rio global economy, were the main reasons delays”. de Janeiro, Pancoast and Froio can’t wait for the decline in confidence. The rising Not having met for more than a year it forever. cost of marine fuels was also a cause was a relief to Pancoast, and other for concern. applicants (including Kingfisher and Froio added: “A reliable and honest In August 2011, the average Spanish shipping company Elcano) that technician, Sergio Passos, has been their requests for FMM funding were confirmed as the new Transport Minister. confidence level expressed by closer to approval, but irksome that He’s very experienced in this sector so respondents in the markets in which they documentation sent to the Department of things should start to move forward now.” operate was 5.3 on a scale of 1 (low) to the Merchant Marine (which administers Froio also said there was still nothing 10 (high), compared to 5.6 in the the FMM) some months ago may now further to report on Pancoast’s negotiations previous survey in May 2011. This is the have to be sent again. to buy two Platform Supply Vessels from lowest figure recorded since the survey Froio would only say diplomatically Norskan (the Brazilian arm of Norwegian was launched in May 2008 with a that “bureaucracies will be bureaucracies” outfit DOF ASA) for around the $60M to confidence rating of 6.8, which remains but further investigation by SMI $70M mark for the pair. the highest rating achieved thus far. NOTEBOOK

AKD warns Dutch ship owners against hiring armed guards

hip owners who hire armed guards directly involved, as well as shore based would entail “several problems” could face criminal prosecution, personnel (including the ultimate according to the committee, requiring Salong with their onshore staff, management of the company) could face drastic amendments to Dutch legislation leading Dutch law firm AKD has warned. criminal prosecution. Furthermore, ship and regulations and under normal This follows the release of The De owners could be faced with local circumstances, such changes would Wijckerslooth Committee report, which legislation covering the import and export require “several years” of consultation has recommended the Dutch government of weapons in the event that the vessel has prior to becoming law. should move towards a greater level of weapons onboard and enters the Mr Kromhout concluded: “Clearly, it protection for its merchant fleet, including jurisdiction of another country.” is the duty of government to do its utmost the use of armed guards, should this be The committee also noted that should to protect the merchant fleet from attacks deemed “necessary”. the government make use of its own by pirates. In the event that the However, the report also advised that resources by engaging reservists or hired government is not able to fulfil its duties, such security personnel should only be armed security guards with temporary for whatever reason, it will have to employed by the government and must military status, this would not represent employ outside help. It is not desirable only perform their duties with authority privatisation of security duties. No that privately owned companies hire from the Ministry of Defence. amendment of legislation or regulations Under current circumstances, the would be required when creating extra armed protection to perform the duties report acknowledged that the hiring of defence capacity in this manner. which are the responsibility of private, armed security guards directly by The recommendations of the government, which should retain its ship owners is not desirable and this committee could usher in the level of monopoly of force. Furthermore, the cost should only be contemplated “in case of protection against piracy considered of providing protection against piracy special conditions”. necessary for merchant vessels but the should be borne by the state. Ship owners Jan Kromhout, a partner with AKD in alternative, whereby ship owners should only be allowed to hire private Rotterdam, said: “In the event that Dutch themselves hire private security guards armed guards in special situations, in the ship owners do hire armed personnel, or (an approach endorsed by the Royal event that the government is not able to provide weapons to those onboard, those Association of Netherlands Shipowners) fulfil its duties.” By Robert Ward

Executive Vice President of the association Roberto Galli for Brazilian flag ship owners, Syndarma s a journalist covering Brazil for restaurants around the ‘Cidade publicised ailing infrastructure in Brazil – more than 15 years, whenever I Miravilhosa’ (Marvellous City). particularly vis a vis airports – has made Aneed to find out what is going on His performances have been relatively these numerous Brasilia trips much more in the high-level shipping circles of the restricted this year owing to a shoulder gruelling than they used to be with far more Southern Hemisphere ‘paradise’, I often injury and also the demands of Syndarma, delays involved. end up calling Roberto Galli. which represents 37 shipping companies in Galli, a Brazilian of Italian descent (as For the current Executive Vice Brazil and has to deal with a large raft of SMI readers have probably already guessed President of Syndarma (the association for issues on behalf of some of the country’s from his name), said that the explosion of Brazilian flag shipowners in Brazil) usually leading activity in the Brazilian offshore industry has his finger on the pulse of what is ship owners. has also added significantly to his happening, especially in Rio de Janeiro, his Throughout this year Galli, along with workload. Syndarma already has an home town and the ‘heartbeat’ of the outgoing Syndarma President Hugo offshoot, ABEAM, that deals with offshore Brazilian maritime community. Figueiredo, has been instrumental in supply vessels, but now another And his sense of rhythm and pulse drawing up the best arguments for shipping association, the Association of Brazilian extends beyond office hours too, as he is companies to lobby politicians in Brasilia Cabotage Shipowners (or ABAC) has been bass player in Cocktail Lounge, a band in regarding crew shortages and Brazilian flag re-invigorated. which he performs with four of his friends owners paying over the top for bunkers and “It has lain dormant for a while but we in various bars taxes in general. have revived it, like a phoenix from the and “I absolutely love my work,” he told us ashes,” explained Galli, in his usual when SMI visited him in his Rio office, colourful way. “We have seen such a “and this year has been a particularly hectic phenomenal growth in the offshore and one, especially in recent weeks.” cabotage sectors that we felt maybe an Indeed it has. association for the cabotage players would Galli’s job has been taking him to help them to lobby for their specific issues, Brasilia - the inland capital of Brazil, some such as paying too much for bunkers and 750 km from Rio - at least three times a local taxes, etc.” month and he has also been involved in a Among the big issues of 2010 were the number of ‘road shows’ where he has been crewing, and especially officer shortages introducing the new incoming Syndarma facing Brazilian flag shipowners. President, Bruno Rocha of Wilson, Sons, to “Thanks to the co-operation of the the country’s key decision makers and Brazilian Navy I think we are starting to power brokers. Galli and Rocha have been win this battle,” reflected Galli. doing the rounds of the ministries of “Against this difficult background the Agriculture, Trade, Industry and navy has been first class and has been Commerce (TIC), Transport, instrumental in boosting the number of the Ports Ministry (SEP) graduates, and this year we should see and Antaq, the powerful around 700 officers graduate from the two body responsible for naval academies: one in Rio and one in all waterborne Belem. That is a good increase from 510 traffic in Brazil. last year and we should be producing close The much- to a 1,000 recruits per year by the end of 2012.” Those figures will go a long way to assuage fears that more and more vessels will not be operated in Brazil owing to the lack of

14 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 FIRST PERSON

fully qualified officers. Some vessels have and know we are not professionals. For is less of that ‘old-time amor’ for the sea already been unable to sail on time due to instance one of our gigs was once cancelled than there used to be.” shortages. because the piano player fancied a holiday And Galli believes the lack of love Government cutbacks in the early in America.” from so many now working in the maritime 2000s saw graduate numbers fall from 400 For SMI readers who might be visiting business has been partly to blame for the per annum down to 250, but the 350 in 2009 Rio de Janeiro in the next few months, very serious crew shortages in Brazil today. and then 510 in 2010 plus the extra capacity Cocktail Lounge are playing every To deal with this problem Syndarma now installed should see targets reached, or Saturday at the French Bistro, located commissioned an independent report from almost reached, by 2014, when many more behind the Meridian Hotel, on Atlantica the University of Sao Paulo and this tome Brazilian flagged vessels are due to come Boulevard, Copacabana. (published three years ago) stated by the into service. Galli may be a keen amateur with his year 2013, the number of officers required As well as the two academies run by music, but in the work environment he is will be around 4,400 and the numbers the Brazilian Navy and CIAGA (Centre of very professional and he enjoys his current coming through the system will only fill Instruction Admiral Graca Aranha), a job too. 3,000 places, leaving a shortage of around number of fast-track and short courses have 1,400, or about 30%. This tome picked up also been introduced, with the navy’s the tone of the shipping community and permission, and these allow graduate I have to admit that for helped Syndarma argue its corner. trainees and applicants with some shipping “me, a ship is much more than With the changes announced last year background to be fast-tracked so they can some of those shortfalls should have become officers within 18 months or two just an assembly of steel and been plugged. years instead of the four years it takes for electrical cables, made to For more than 20 years Galli worked cadets starting straight from school. for Docenave, the shipping arm of the then “If Syndarma, the navy and all the produce money and wealth state-owned mining giant Companhia Vale

relevant bodies hadn’t acted promptly we for investors. To me it is also do Rio Doce, which is now called Vale, just would have seen dozens of ships all lying as Docenave has transmogrified into Log- idle in Guanabara Bay because there like a person, with something “ In Logistica SA. weren’t sufficient officers to man them,” inside it, which is why we Most of the time Galli was occupied in warned Galli. the bulk shipping sector, and one of his Galli feels that Sindmar had got its refer to them as she or her responsibilities was for shipping iron ore numbers and forecasts wrong, because it around the world. He then went on to work did not take into account the rapid in the container sector, firstly running the expansion currently underway in Brazil, the Galli took over as Executive Vice Mediterranean services, then called growing market, the fact that some officers President of Syndarma from the highly Paulista, for Libra Navegacao. work in terminals and equipment industries respected Claudio Decourt some four years Galli enjoyed that as it took him back to and the natural wastage when some ago and he knew then what a tough job it his Italian roots on several occasions. Libra graduates decide in the end they don’t want would be and that the highly respected was then taken over by Chilean carrier to go to sea. Decourt was a tough act to follow. CSAV, and renamed Companhia Libra de Another big issue for Brazil and “Yes indeed, Claudio is a good friend Navegacao, at which point he left. Next Syndarma for the rest of this year is the of mine and we go back a long way, and he stop was to run the container division of Registro Especial Brasileiro (REB, or is such a distinguished and respected figure Docenave, and a year as a granite exporter Special/Second Brazilian Register). in the Brazilian shipping community that I was followed by five years trying to restore It is expected that Syndarma, under the knew I would have my work cut out to fill Ivaran as an operator in Brazil, following a leadership of Bruno Rocha, and backed by his shoes,” confessed Galli. request from owner Erik Holte-Sorenson. Galli, will launch a major offensive this But with great gusto and bonhomie the “Then I got the call from Hugo year and next to strengthen the REB. Brazilian with Italian blood set about the Figueredo, the then President of Syndarma, Galli explained: “We have had the REB business of trying to fill those Decourt size to take over from Claudio Decourt,” he for some years now in Brazil but it needs to 41s (9s in UK sizes). reflected, “and that was an offer I definitely be adjusted and expanded. It needs to have Like Decourt, Galli is definitely old could not refuse.” more flexibility and better fiscal school, and in many ways a romantic when Galli worked closely with Figueredo, arrangement and some of our members are it comes to the world of shipping and he who was also President of bulk shipping thinking maybe we should have a tonnage doesn’t exactly like the way the glory, the line Norsul, until just two months ago when tax like in the UK. Many vessels have re- majesty and the personal touch is he was replaced as Syndarma President by flagged with the UK flag and maybe the disappearing. He explained: “I think that Bruno Rocha, of the Wilson, Sons shipping same would happen here with the REB. I today investors invest in a shipping group. know that Bruno Rocha will be making this company, just as they would in a farm for Reflecting on the differences between a priority.” cows, or a factory for tyres, and ownership the bulk and container shipping sectors Galli looks forward to the day, in a few is far different from when I was making my Galli said: “They are completely different years’ time, when he can retire and spend way through the ranks of the Brazilian types of animal. more time sailing and, especially, bossa shipping industry.” “On the bulk side you are dealing with nova’ing. “I have to admit that for me,” reflected raw materials and with very powerful He told SMI: “I really love my work Galli, “a ship is much more than just an people. And on the container side you are and I love playing the bass too. My band assembly of steel and electrical cables, dealing with many individuals, and plays all the Brazilian classics, of bossa made to produce money and wealth for sometimes the shippers want to squeeze nova, of Tom Jobim, and Joao Gilberto, investors. To me it is also like a person, with you hard for just a few hundred dollars, but plus standard jazz classics like Cole Porter, something inside it, which is why we refer the shipper and carrier need each other, and Burt Bacharach and many more. We give it to them as she or her. I guess you could say one must never feel superior to the other. I our all when we play but we play for fun that a ship definitely has a soul. Today there feel today many shipping companies are

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 15 FIRST PERSON

really suffering the pressure – with the oil container shipping company left on the Brazilian law and fly the Brazilian flag. We price increases, falling freight rates, etc – planet. In April Maestra Logistica entered are very open about this and I guess this is and I just hope the shareholders allow the the Brazilian cabotage trade with two (and why we are drawing in more and more companies enough oxygen to breathe and now has three) vessels, and it too was quick members every year.” survive these difficult times.” to join Syndarma, and ABAC for Galli’s other great passion outside of Be that as it may, Galli does often have that matter. work and bass playing – apart from his his finger on the pulse of the Brazilian and, Galli said: “Log-In has been a huge family, of course – is sailing, which he first indeed, international maritime scene and he success since the Initial Public Offering took up when he was 30 years old. feels some changes are just about due in (IPO) three years ago. And it is good that “Back then we used to be very what kinds of companies set the pace. they have brought new oxygen into the competitive and I took part in many He outlined his international economic system by expanding and buying and competitions in racing dinghies and I was theory to SMI, beginning: “I think that what building new vessels.” good at it,” enthused Galli. “We took part happens in any business is firstly This month (October) Log-In will start in competitions mostly in Rio de Janeiro concentration leading to uncomfortable operating the second of five 2,800 teu, state, but sometimes in Sao Paulo state oligopolies, and then once the structures get Brazilian flag container vessels, built in the as well.” too top heavy, a process of atomization sets Eisa Yard, in Niteroi, for a combined cost Galli was, and still is, a member of the in and allows niche carriers to operate of $820m. Charitas Naval Club in Niteroi, where his successfully. I am absolutely convinced this But Galli is also pragmatic and is 30ft yacht is currently berthed. is what we will see over the next few years pleased companies such as Alianca Galli usually just sails his yacht around in shipping. Navegacao e Logistica Ltda, and Mercosul Guanabara Bay, near Rio and Niteroi, but “This process is already happening in Line, still operate under the Brazilain flag, once a year he sails the 60 nautical miles to the airline industry, with small, agile although under foreign ownerships - the beach resort of Angra dos Reis, thereby players such as Ryanair and easyJet in the Hamburg Sud and Maersk Line, re-affirming his love of the sea. UK and Gol in Brazil, coming onto the respectively. One knows that the Syndarma scene and taking over much of the business At least by flying the Brazilian flag it Executive Vice President will always retain from the larger, more cumbersome guarantees jobs for Brazilian seafarers his “old-time amor” for things maritime, operators.” and officers. and if only more young Brazilian officers And it is against that background that “We welcome all new members at could maintain a similar affection with the Galli, a patriotic Brazilian to the core, is Syndarma, whether they are foreign-owned same amount of passion – then Transpetro, very proud of the resurgence of Log-In or Brazilian-owned,” emphasised Galli. “It Log-In and other Brazilian flag owners which, until April of this year, was the one is not the nationality that counts but would have no future problems manning fully owned, and still operating, Brazilian whether or not the companies observe the their expanding fleets. ■

SHIPMANAGEMENT HOW I WORK How I

SMI talks to industry leaders and asks the question Howwork do you keep up with the rigours of the shipping industry?

of nearly DKK9 million. Per Gullestrup was heavily involved in negotiating with the pirates in 2008. A Somali pirate now faces a 25 year prison sentence in the US after he was convicted. “Despair is a good word,” to describe the way ship owners feel about the whole piracy issue, he told SMI. “It is a hard word but there are times in a quiet moment when you say, look what is going on here. It is 2011 and we are five years into this and we are still being run around by a bunch of criminals because that is all they are – extortionists, murderers and criminals. And even the largest naval powers in the world haven’t been able to do anything about it and they won’t until we do something fundamentally ashore in Somalia. Until then, we will not solve this problem,” he said.

We took the decision “three to four months ago that we could not defend our

ships without contracting-in with light machine guns and who will PER GULLESTRUP shoot back. I hear that 60% to 80% of armed guards “ with light CEO & Partner, Clipper Ferries/Ro-Ro owners are in favour of arming their ships, machine guns and who will which is a lot, and if you figure out that s many as 60% to 80% of ship every time you do, it costs an owner shoot back owners are in favour of arming between $30K and $50K to put armed Atheir vessels even though the cost guards on each passage then you are “We now have the monsoon season can be as high as $50,000 per passage. talking about a lot of money,” he said. and this will have a strong reflection on the This was the considered view of Per Mr Gullestrup has built up first hand level of activities going on. But even when Gullestrup, CEO & Partner of Clipper knowledge of dealing with pirates after he the monsoon settles down, I suspect you Ferries/Ro-Ro, when SMI recently caught negotiated with Somali pirates over the will see a lot of the ships being armed now. up with him in Copenhagen. release of the CEC Future back in 2008. But what will that do to the equation? “We took the decision three to four Pirates held the CEC Future for 71 Hopefully it will put a dampener on months ago that we could not defend our days, and only released the ship after activities but it won’t solve anything. ships without contracting-in armed guards negotiations and the payment of a ransom Because the pirates might start to lose too

18 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 HOW I WORK SHIPMANAGEMENT

much money and the investors will stop getting the returns they want, they will retrench and ease off. The naval forces will then say the situation is better and the pirates will be back in action and we will be back where we started. We as ship owners are very frustrated. If this kind of criminal activity happened anywhere else on this scale something would have been done about it but 94% of the seafarers involved in this are from developing countries and that is the reason. If the 94% of seafarers were from Europe or the US, I guarantee we would not have been talking about it now. It is a disgrace,” he added. Moving onto the general market conditions, Per Gullestrup is a supporter of the notion that what goes down will go up and that the current shipping recession is nothing really new. “Nothing has changed. I have been in the business for 40 years now and I have seen these things come and go. When I first started in shipping it was back in 1972 when I was with AP Moeller Maersk and in those days we had the boom and bust years for VLCCs. I witnessed a market situation where Maersk effectively paid off a tanker on one trip and I then saw a market situation where the Norwegians built VLCCs that went straight into lay up in Oslo Fjord. Some of them never took air only to go straight onto the beaches afterwards. So what has changed? Nothing, it is just a matter of what is the length of the cycle. There may be a very grim situation today but will it last? Of course not because the demand side is not bad. It is the supply side that is the Despite the rigours of running the world’s problem and as owners we manage to CLIVE RICHARDSON largest shipmanagement business, he has mess it up every time.” Chief Executive Officer, V.Group been an accomplished rugby player and Per Gullestrup has moved from the now finds time to keep fit by running four or liner sector where he was in for 10 years to five-miles several times a week. He relaxes head up the project cargo business and for live Richardson was in buoyant with visits to the theatre, reading books and, the last two years has taken care of mood when SMI caught up with as a seasoned international traveller, enjoys Clipper’s non-core activities such as its Chim on September 2nd – the very demonstrating his culinary expertise by Danish domestic ferry business, which day the $520m deal with Omers Private cooking a range of international dishes. also happens to be the largest Danish Equity finally closed. Mr Richardson clearly regards his new operator in Denmark through a 50:50 joint The barrister-trained Chief Executive, shareholders with confidence. “We ran a venture with the Danish government. He who has worked in a number of global competition and considered three out of the also heads up the company’s ro-ro businesses, including aviation at BAE five contenders in the second round to be activities in the Irish Sea. Airbus and defence at technology company very favourable organisations,” he “As far as Clipper is concerned our QinetiQ, has been at the corporate helm of explained. “But Omers is a tier-one private bread and butter business is still in the V.Group for nearly two-and-a-half years equity house and an excellent cultural fit – handysize sector. We are not so sorry when and is clearly excited by the prospect of it is itself a global business and therefore we see these market gyrations because working with new majority shareholders clearly understands our operations and the when the market changes you are flushing who, together with management, have challenges we face in providing a first-class out a lot of the older tonnage and you end bought out Exponent Private Equity. service to customers all over the world.” up pushing the curve quicker. We haven’t “Omers is a powerful new financial Mr Richardson conceded that the had a bad market in handysizes and if you backer for us,” Mr Richardson declared. V.Ships management team and its various manage to take in contracts on a “The fact that it is a large private equity past private equity shareholders have not reasonable level and manage to hedge your investment group which is evergreen always seen eye-to-eye. There have bets on the FFA, then a lot of the owners presents no real exit pressure. What's not inevitably been frictions from time to time, have done fairly well. So we are not so to like?” but that is partly because it is unusual to find sorry about it as we are going through the The ardent supporter of Bath Rugby private equity firms at what he describes as cleanup phase as we always do. I don’t see Club and Liverpool FC lives just outside a “mid-market level” but nevertheless, anything new this time.” ■ London with his wife and four children. operating in a global business environment,

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 19 SHIPMANAGEMENT HOW I WORK

expand our marine service offerings, both

We plan to increase the number of ships under within our operated fleet and to third parties. “management; we intend to provide more“ ships’ crews; and we We also aim to grow our marine travel business and anyone reading this article who plan to expand our marine service offerings, both within our wants to talk to me about this is welcome to operated fleet and to third parties get in touch. There is quite honestly, lots to do.” such as shipmanagement. “That can be the marine support services to third parties. This Despite its global reach, V.Ships has point where you get a bit of friction at broad geographical spread has been built more to do in geographical terms, Mr governance level,” he said. This is not one around a robust network of systems, all Richardson said, and giving one example, of his concerns, however, in regard to the designed to ensure maximum efficiency at he said: “We are under-weight in Asia”. He new shareholder. lowest cost. won’t be drawn on any details but there are So, how is it that V.Ships has been able Mr Richardson commented that private certainly plans to raise the company’s Asian to attract a string of private equity equity shareholders come with their pluses presence, take on some of the large ship investment groups over the years whose and minuses, but one of the big advantages managers who dominate that market and to objectives are usually fairly short-term, is that cost control is always a major focus. look for acquisition opportunities in the while most other ship management firms As a result, he said, V.Ships has driven Asian arena. continue to operate, funded mostly on cash down costs and raised efficiency through “We are a sensitive acquirer of flow and vulnerable therefore to the sound cash, procurement and logistics businesses and we have been successful in vagaries of the markets? Following an early management. These underpin group our many past acquisitions,” Mr Richardson minority investment by GE Capital after the operations today and provide an operating said. It is certainly true that Omers’ birth of V.Ships from the Vlasov Group in cost framework, he said, that is second to ambitions for the company and its deep 1984, Close Brothers bought a stake in 2003 none. pockets put V.Ships in a very strong and sold out to Exponent in 2007. Now The focus on cost control has meant that position. “Omers already have an eye for the Omers has bought out Exponent, together certain back-office functions have been shipmanagement business today,” he with management which holds a significant centralised and located in low-cost parts of observes, “but in looking at us, they’ve also minority stake and upon which Mr the world. Group accounting, for example, been quite open about growing the business. Richardson would not specify. is run out of Mumbai. This strategy, Mr They expect to invest in that process.” A key attraction for external investors Richardson explained, has given the In the short run, the likely growing is the fact that in addition to company the confidence to claim that it can scale of distress in some shipping markets shipmanagement, V.Ships owns a offer operating cost savings to any potential may present opportunities. But this is significant portfolio of marine service new customer of at least 10%, excluding certainly not a ‘no brainer’. Mr Richardson companies, including financing, brokering, fuel and finance. And this sort of margin explained that a large part of V.Ships’ a marine travel business, a specialist ship soon mounts up over a fleet of ships, he successful cost control and low rates are repair and maintenance company, and an points out. based on managed ships fitting easily into extensive manning operation with 25,000 company systems. Distressed assets are seafarers on its books and 17,000 of them in usually exceptional, requiring a significant shipboard positions at any one time. “We We are rightly known for resource commitment which can be pride ourselves on being more than just ship “providing competitive rates disruptive. In fact, he points out that over managers,” explained Mr Richardson. recent months, the company has taken

“Nobody covers all the ground that we do,” to our clients and if we're decisions to terminate management he said, referring to a number of key aggressive, then we're“ doing a contracts on about 30 vessels which failed competitors including Anglo Eastern, to comply with its operating systems and Columbia, OSM, Thome and Wallem. “We good job for them. I'm quite were therefore consuming too many are twice the size of even the largest of proud of that resources in one way or another. them.” And in the shipmanagement V.Ships is likely to approach any business, size definitely does matter. distress with caution but Mr Richardson In terms of its core shipmanagement It also means that the shipmanagement noted that whereas many believed there business, Mr Richardson said the company business is shielded, to some extent, by the would be lots of distress-related business a offers a service that shipping companies can peaks and troughs of the shipping markets. couple of years ago, shipping banks opted provide internally themselves. “But we do That 10% in operating cost savings is very to ride with it and as a result, there it better and more cheaply than many ship nice to have when times are good, he said, were relatively few arrests and deal owners.” And he is not concerned that but in a tough market such as that prevailing restructurings. Over the last six months, V.Ships is well known for the pressure it across a number of shipping sectors today, however, there has been a notable pick-up puts on suppliers and service providers. “We that margin can become critical. “We can in problem business and he notes that some are rightly known for providing competitive demonstrate that we are 'acyclical' – We ship finance institutions have made clear rates to our clients and if we're aggressive, don't get impacted by shipping cycles,” Mr their intentions to pull out of the sector. He then we're doing a good job for them. I'm Richardson said. is adamant, however: “We will carry out quite proud of that,” he said. So, where from here? “Well, we may detailed risk assessment, not only on vessels He points out that the V.Ships have got a lot of things right so far, but but also on clients.” management team has built a global there’s plenty more to do. To paraphrase the It may still be early days in V.Ships’ network over the years which is now best- words of David Cameron, we did fix the new ownership but Mr Richardson clearly placed to serve the worldwide shipping roof when the sun was shining. We have a relishes the prospect of growing group business, and he points to the company's 70 business model that is very simple and very business over the months ahead. With offices in 34 countries which support the effective. We plan to increase the number of Omers’ support he is well-placed. Almost operation, manning and maintenance of ships under management; we intend to certainly, a new era in the company’s more than 700 vessels as well as providing provide more ships’ crews; and we plan to development has now begun. ■

20 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 LEON PATITSAS Founder and Chief Executive Officer, Atlas Maritime

s another card in the prestigious deck of young, Athens- based owners, Leon Patitsas has gained prominence Asince forming Atlas Maritime in 2004 – an international player with a fleet of six double-hull aframaxes. Though Atlas Maritime is a relatively new competitor to the Greek market, Mr Patitsas has a rich family tradition of shipping which can be dated back to the Lemos family of L.C. Lemos and Efploia Shipping, who from 1860 to 1914, owned 52 vessels. In 1905, Leon Patitsas’s great grandfather, Christos M. Lemos, purchased and captained the company’s first steam ship, the 3,550 tonne Marietta Ralli before adding the steam ships Triaina and Efploia to the fleet. Capt Lemos’s sons, including Captain Leon Lemos – the grandfather of Leon Patitsas, continued the family tradition by co-funding the London-based business Lemos & Pateras in 1937. The Lemos brothers purchased the Liberty ship Hellas in 1947 and established G. Lemos Brothers in London in 1952. Capt Lemos founded the Efploia shipping company in 1967 with a fleet of 17 ships and in 1968, Leon Patitsas’s father, Spyros Patitisas joined the family business. Now, with a new generation at the helm, Leon Patitsas and his brother Philimon Patitsas, Director of Business Development, are drawing on their childhood love of shipping and extensive business experience to make Atlas Maritime a success. “I’m the fourth generation of ship owners and shipping has always been in my blood – it was a passion for me as a child,” said Leon Patitsas. “I loved the stories and the shipyards, which I have visited since I was a small kid. It’s something that fascinates and interests me and my vision is one day, to go back to the shipyards with my grandchildren – to instil this passion and interest in shipping and pass the legacy on, which my brother Phil and I, will create for the next generation.” Though this family tradition is of key importance to Mr Patitsas, some may be surprised to learn he was born in London and retains British citizenship. But despite his dual heritage, Mr Patitsas told SMI it’s the Norwegian maritime industry which he is currently looking up to: “Norwegian shipping companies are role models because they are the SHIPMANAGEMENT HOW I WORK

leading examples in corporate governance he told SMI, with effort, Greek players will economy. We have to keep it that way in and in safeguarding shareholders’ see a bright future: “It’s going to be order to be competitive for the international interests.” challenging, it’s going to be tough. We have arena.” Mr Patitsas said he admired Norwegian to stay put – we are fighters, we never give Reiterating his concerns over Greek shipping companies for creating loyal up and eventually the markets will recover. ‘competitiveness’ on the global stage, Mr relationships with their shareholders and for We are faced with an oversupply of tonnage Patitsas also expressed his view that Greece ‘looking after’ their interests, to the extent and this oversupply needs to be soaked up should remain a tax haven for owners: “It’s that whenever they needed to ‘tap’ the gradually but we are already seeing an a known fact that ship owners can be very capital markets and raise further equity to increase in demand for oil which will soak mobile. They can move anywhere in the make an expansion or an acquisition, “the up this additional supply” world – to Monaco, Singapore, Dubai, shareholders are there for them”. Switzerland, so there are other tax havens. With a particular interest in shipping If they try to tax Greek owners, it’s only finance, Mr Patitsas has formed a strong I’m the fourth generation logical to assume they will move

background in both the business and hands- “of ship owners and shipping somewhere else. We saw that happening in on aspects of shipping. In his previous role the 1960s in the US when Kennedy as head of Strength Shipping (2000 to has always “ been in my blood imposed tax laws and many shipping 2004), Mr Patitsas worked to develop a – it was a passion for me as companies left New York and went to the more corporate ethos and renewed the UK. We have also seen it recently, when a entire fleet. Previously, Mr Patitsas also a child lot of owners left London to go elsewhere worked for the Swiss, New York-based so I think it will not be good for the bank Union Bancaire Privée (UBP) as a So, when riding out the recessionary local economy.” member of the team which invested assets waves, what can Greece learn from other But beyond the stress of the markets, into hedge funds. He also served as an nations? “I think Greece should take some how does Mr Patitsas like to spend his spare engineer onboard a merchant ship and holds lessons from Singapore and we should try time? “I play a lot of sports, beach a Degree in Mechanical Engineering from to attract more foreign companies to come volleyball, water skiing, basketball and I Tufts University and a Master of Science in and set up businesses in Greece and give love snowboarding – I do all sorts of sports Ocean Systems Management from them incentives. Of course, it’s needless to and this relaxes me a lot,” he told SMI. “I Massachusetts Institute of Technology. say we must have a tax-free environment in also like to read books – it’s going to sound With his robust knowledge of the order to attract these kinds of companies. weird, but I enjoy reading books about business of shipping, one might presume Companies will invest money in Greece economics and the world economy Mr Patitsas would be worried about and will hire people – unemployment will (including Fortune magazine) – it Greece’s future as a maritime nation but as go down and it will be a good thing for the relaxes me.” ■

22 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011

MARKET SECTOR TECHNICAL MANAGEMENT Technically

soundBy Helen Jauregui

he demands on a technical Ship Management, said this shortage is management,” particularly owing to the manager’s time are varied and mostly related to senior officers, while he complexities of modern vessels. He said the Tmany, with responsibilities ranging has not experienced any serious problems lack of suitable crew is a “constant from technical support, logistics and in recruiting ratings and junior officers. problem” for ship managers and that operations and service and maintenance, “The shortage often led to problems with retention of well-trained, good quality crew but as a lack of qualified and competent complying with the oil majors experience remains key in all fields of ship crew continues to plague the industry, matrix for our tankers – this requires management: “Training courses are technical managers are concerned over specific experience levels and service time required to enable the crew to operate the how to cope with an increasingly regulated with the company,” said Mr Tunge. “These vessel to maximum advantage of equipment industry when faced with strict budgets requirements are all sensible and we do our installed. Once they are trained there is a and aging vessels. utmost to do even better than the minimum need to retain these crew members as they Capt Vijay Rangroo, Managing requirements. become an asset to the company, assets Director of MTM Shipmanagement, “However, it is often very difficult to which the company cannot afford to lose. explained how problems within technical manage and it is likely to take time before Not only do we lose good crew but the management are ‘two-fold’, as the situation will improve much. Our target investment we have “put in” to train them. professionals work to deal with persistent is to have permanently assigned top officers We have to work hard to keep our crew challenges while coping with new onboard all our ships and have two groups retention levels high. This means we have regulations. He added that when regulations sharing one ship over extended periods, to gain their confidence that we will operate are ‘reactive’, this can usher in a number of which will help resolve the compliance a modern fleet which is technically sound, recurring problems such as human error, issue and add quality to the management supplied with good quality spares and due to incompetent crew. Though Capt onboard by having a team that really knows above all, that their living conditions Rangroo welcomes new regulations, he said their ship.” onboard are good and their salaries are paid these must be executed in an effective Although Mr Tunge said he believes on time.” manner in order to avoid placing further the shortage of quality officers and shore Danilo Raffa, Managing Director at burden upon the shoulders of technical staff “is still the most serious challenge” for Singapore-based ISHIMA International managers. He added that one serious and his organisation, he explained there are Ship Management, agreed that a shortage recurring issue is a lack of quality crew, a some indications that the situation is of good quality crew is having a detrimental predicament which, according to Capt improving, though signs of “tangible effect on technical management operations: Rangroo, “has continued to plague the improvement” are yet to be seen. “This “We believe the main tool to properly industry for several years” and will easily leads to pressure on wages as well as not technically managing a ship is the “be with us for several more”. being able to secure the right people at the performance of the crew and especially of Agreeing that crewing is a significant right positions,” he said. the top officers. It is a particularly difficult problem for technical management Edward Bucknall, Technical Director at time – shipping is going through a difficult providers, Steffen Tunge, Acting Managing Columbia Shipmanagement, also noted that period, but it is important to keep the ship Director at Singapore-headquartered MSI “qualified crew are the key to successful manned by properly qualified seafarers and

24 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 TECHNICAL MANAGEMENT MARKET SECTOR

Images Courtesy of Unicom Management Services to keep the maintenance of the vessel as shipmanagement companies are keen for a states. On top of the mandatory rules high as the required standards of industry constant barrage of new regulations: “There and regulations, we have commercial as this is the only way to keep the vessel is a huge impact – we need more and more requirements which are more or less employed and accepted by the majors but resources everyday because of regulations. mandatory for the specific trade – which at the same time, cost is a big concern.” Mr It’s getting more difficult to manage a might differ for particular flag states or Raffa added that ISHIMA provides as much modern fleet – it’s not like 15 years ago. My international requirements. In the future, the support as is required to the crew but personal opinion is that not many new industry as a whole would benefit from ultimately, for any ship manager, “if the managers will appear on the market more aligned interpretations of rules and personnel onboard fail to perform, the ship because the barriers to entry are very regulations.” will not always be well-managed”. strong. Some small managers will disappear Highlighting the fact that However, according to Nikolay from the market as they cannot survive. I environmental issues and fuel reduction Spichenok, Managing Director of Cyprus- think ship owners will look for reliable strategies are becoming more prominent based Unicom Management Services, managers and bigger managers.” within industry, particularly owing to high technical management is suffering from the bunker prices, Mr Tunge said it is vital that negative impact of not just a lack of crew, technical managers and other stakeholders but of qualified crew – though he said this It’s getting more difficult to take heed and comply with such issues. can be addressed successfully in-house: “A “manage a modern fleet – not However, he noted that his own company is modern vessel needs experienced and very concerned with how ballast water treatment well-trained staff. In our company we many new managers will regulations will impact their operations. He employ only Russian seafarers so for us, it appear on the market“ said this regulation will prove particularly is not so critical because most of our challenging for large VLOC ships with captains started with us as cadets – every because the barriers to entry ballast in excess of 100,000dwt. – he said year we employ around 100 cadets who are very strong the need for equipment capable of treating start with us as captains or chief engineers.” such large quantities in a reasonable amount Mr Spichenok also expressed concerns Nikolay Spichenok, time “seems to be a huge challenge”. over the newbuilding strategies of owners Managing Director, Unicom But as Mr Raffa noted, it is important to and said this is having a negative impact on understand that both owners and managers technical management providers: “We are Management Services are ultimately working towards the same facing a poor market, variable freight levels goals through technical management, and very high bunker prices so ship owners “The industry is over-regulated for despite the continuing challenges of want high standard management for low environmental issues – ballast water regulations: “We share the same concerns management fees. Nowadays, age of the treatment is very expensive but there’s no as the owners – we are a service-provider vessel is very important. Any tanker older sense in modifying older vessels. It’s a so we must follow what our clients are than 15 years is very difficult to market, problem – a vessel can reach five or seven looking at. The owners are concerned even if it’s in excellent condition – there are years old and you’ve invested a lot of (especially tanker owners) about the a lot of new fleets available.” money in it, then the vessel reaches 15 standard of their ships as acceptable to the According to Mr Spichenok, when a years old and you’ve invested a lot of oil majors – they are looking to have the vessel reaches the age of around 15 years, money for a ship which cannot be used in cost controlled and to comply with owners face a “decision making problem” the market.” regulations.” whereby they must either bring the vessel Carl Schou, President at Wilhelmsen He added that the main issues of into compliance with new and forthcoming Ship Management agreed that a significant concern for ISHIMA at this time are control regulations or scrap the vessel – a element of technical management is of emissions and reduction of fuel problematic situation as even after 10 years, adherence to rules and regulations and said consumption and he explained that the owners often need to “invest a lot of money one of the “greatest challenges” for company is currently studying the market to keep the vessel in good technical technical managers is implementing and for new solutions to assist with this. condition”. following these rules: “It becomes “During the years when shipping was The need to bring older vessels in line especially difficult when countries adopt booming, there was much more optimism with modern standards is an important different rules for the same issues. For so everything was seen under a different generator of business for technical example, the US has adopted different rules light. The owners were seen doing their best management providers but as Mr – so a vessel might have to adhere to several but now everybody’s more careful (with Spichenok explained, this does not mean different interpretations of rules in different costs). It’s a difficult time for shipping and

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 25 MARKET SECTOR TECHNICAL MANAGEMENT

tankers – everybody is looking for the light these regions, in response to “a lack of We have a lot of new vessels and still we at the end of the tunnel,” he said. seagoing experience” currently seen in have an old fleet which is a problem – the Mr Raffa also explained that in offices ashore. only good thing is that scrap prices are Singapore, a further concern is the very good.” weakening of the American dollar. He said Staring at a computer A further advantage of regulations is the Singapore dollar is “getting stronger and that as the industry continues to adapt and stronger” but as salaries and overheads are “screen will not fix your engine, comply, further emphasis is being placed on paid in American dollars, its possible to it will only tell you what new technologies and methods of effectively lose 15% of one’s profits. improving technical management

“Management fees are paid in American parameters are out of line operations. Capt Rangroo again: “Our dollars as I must pay the salaries of the and perhaps what needs“ to company evaluated several software technical superintendents etc in Singapore solutions popular in the industry but finally dollars but 80% of expenses are in be repaired. The hands-on settled for developing comprehensive Singapore dollars so we are suffering a little element remains software in-house. This software is bit and we hope the US dollar will dynamic and keeps pace with the changing strengthen in the near future.” Edward Bucknall, Technical regulatory environment as well as our So, how do technical management Director, Columbia customers’ needs. In comparison to older providers see their sector changing in the methods of working, we now have data near future? Capt Spichenok said that as Shipmanagement definitives and analysis of such data for owners become more price conscious, some prioritising our work and decision-making.” key changes will occur within the Commenting on how regulations such Capt Rangroo added that one further shipmanagement market: “I expect there as ballast water management could alter the implication of the digital revolution for will be a process of mergers and technical management landscape, Capt technical management is the potential for a acquisitions in the ship management Spichenok concluded that although an future system of management similar to market. We are in a period of change and influx of new regulations can be a burden internet banking. As he explained: transition and as I mentioned, small for owners, “It is good for the future to “Transactions between the ship and the managers will disappear, and there will be manage vessels closer to compliance with office will be internet-based where ship only a limited number of new managers.” new regulations as this will push rubbish data will interact with shore software Mr Spichenok added that he expects to see out of the market. Crew will be happy, systems, so instead of a superintendent you an influx of successful ship management managers will be happy to run a new fleet – would have customer relationship officers players from India and other Asian nations the only problem is the freight market is who would liaise between the people and more chief engineers will also hail from very poor because of a surplus of tonnage. onboard and the owners or other TECHNICAL MANAGEMENT MARKET SECTOR

stakeholders. Competent crew would still will see much stricter controls coming into information is spread a lot faster – and it is be required onboard even though this may force with more frequent checks from port possible to receive and send more dwindle down further than what it is now.” state and flag state together with class,” he information, thus leading to a higher level But should technical management said. “Advances in engine technology will of technical management. Today’s shipping providers be wary of investing in new mean that most vessels will operate safely is quite complex with large amounts of data technologies and methods of working? and reliably for five years extending for – and as such this ‘revolution’ was needed.” Edward Bucknall again: “New technologies some machinery after checks for 10 years. Mr Schou added that he expects more keep us on our toes and as managers we Technical crew numbers will be reduced “specialisation and differentiation” in must be aware what is on offer out there and and more work will be done by specialists technical management for the years to come carefully evaluate each new technology. from ashore.” He added that although as “shipping is becoming quite complex What is important is not to accept in blind attempts to use automated systems for and the advantages of volume/size are faith a “new” technology just because it is North Atlantic ro-ro and container vessels difficult for owners to overcome”. new. Some of these technologies may not during the 1980s failed due to unreliable Steffen Tunge concurred that technical be suitable or not suitable at the moment. engines, today, the industry is embracing management is facing a period of transition: They may reoccur years later in a different “enormous improvements in engine “There are already a lot of changes going guise supported by other technologies. The reliability and the reliability of automated on in many organisations. With shipping in digital revolution is here to stay. It provides systems, both hardware and software.” a general slump and with increasing costs an excellent tool for collection of data, and Mr Bucknall added that modern for staff, most often in US dollars and little speed of analysis, but it should be viewed communication methods have allowed with caution. It does not supersede ships to avoid complete isolation and so, or no possibility of increasing management condition-based monitoring and effective advice on how to solve technical problems fees, we will continue to see a shift of back maintenance procedures through the use of can now easily be relayed from ashore, office functions from high cost areas like competent trained engineers and crew. verbally and graphically if required. “With Singapore, Hong Kong and the UK to lower Staring at a computer screen will not fix the continued shortage of seafarers this cost areas like India and the Philippines. your engine, it will only tell you what would appear to be one way forward by This is already happening on a pretty big parameters are out of line and perhaps what making use of today’s ever advancing scale and it will continue. I believe this will needs to be repaired. The hands-on element technology and design,” he said. be the main focus for many companies in remains.” Stating that advances in software the next few years. Training and Explaining how he believes technical technologies could allow for improvements development of shore staff and high management will change in future, Mr in technical management operations, Carl retention will be another challenge that we Bucknall said he expects it to develop in a Schou said: “The implication of the digital will all have to deal with to succeed in similar fashion to the airline industry. “We revolution for technical management is that this business.” ■

INSIDER SHIPMANAGEMENT

Exploting your strength is as much about who you know of cultures as well as of shipping expertise, and the cultures differ in Asia as much as they differ in Europe or the Americas,” he added. Denis Petropoulos Singapore is growing as a regional hub and as an island it is probably becoming close to capacity, but it has held onto its position as Executive Director of Braemar Shipping the regional capital of commerce and, according to Denis Petropoulos, Services plc is going to remain that way. “It has managed its finances well in the past three years and as a result has come out stronger,” he said. ingapore is strengthening its position as a technical and But while Singapore may have witnessed double digit GDP growth commercial maritime super hub but corporate success cannot over recent years, the shipping industry on the island and elsewhere, is Sbe taken for granted and is as dependent on strong and effective struggling to come to terms with the ravages of the global recession. relationship-building as it is on delivering constantly high service Ship owners are finding problems offsetting rising vessel operating levels, according to the head of one of the island’s leading shipping costs against dwindling freight rate revenues. While the environment services businesses. in Singapore and the rest of South East Asia is vibrant and shows every Denis Petropoulos is an Executive Director of Braemar Shipping sign of remaining so, the question on the lips of experts like Denis Services plc but moved out to Singapore nearly a year ago to head up Petropoulos is to what extent is the depleted freight market sustainable the Group’s expanded Asian headquarters which now employs more for business? than 120 staff at its Pickering Street offices. Denis Petropoulos again: “More owners might start locating in “One of the issues participants coming to Singapore expect is that Singapore in search of a growing client base and because they want to the region is going to come to them. But to succeed in Singapore, you grow their relationships across the board. Today, it is survival of the have to be prepared to go out and meet the region. South East Asia is fittest. Those ship owners who have made provisions for poorer a highly competitive region so drawing on the good relationships made markets and who have been conservative in their investments and is crucial to maximising opportunities that may exist. People also have modest in ordering ships will survive. They will have to spend money the wrong impression that you have to undercut your prices in order to earned but they will survive. Some owners who have been somewhat compete. I believe that, while the service you provide has to come up eager in ordering, because they were pushed by available money and to scratch, it is the companies and the individuals who can build on started to order without giving real consideration to what actual demand new and historical relationships who will prosper,” he noted. will be over the next two years, will suffer and, if they have ordered The Group’s five Singapore businesses have been brought under tonnage at prices that can’t be sustained over the next two years, then one roof – shipbroking, including offshore, port agency as well as I will say there will be quite a lot of tonnage changing hands. Braemar's technical services of maritime and offshore surveying, “The ships won’t go away and one factor that can’t be discounted marine warranty and hull and machinery surveying, and loss adjusting. if the market carries on as it has done, is lay-up. Lay-up has been These are all represented through its Braemar Seascope, Cory Brothers present in every market segment since the late 1970s when there was and Braemar Falconer and Braemar Steege subsidiaries. The Salvage massive over-ordering following a strong market. The over-ordering Association has also been introduced through a recent acquisition and state continued until the mid-1990s when there was light at the end of Braemar has expanded its chartering activities in Singapore by moving the tunnel. I can’t say we have an identical situation to then, but over- into the deep sea clean and dirty products tanker trades and sale and ordering is here and one of the solutions to ships running below OPEX purchase. is layup, across sectors.” “Shipping isn't necessarily moving east but it is the growth in But what about scrapping levels, are they at the levels they need to shipping that is moving east, Denis Petropoulos said. “The geography be at? “Scrap yards do not have the ability to scrap tonnage fast enough of Singapore makes it an ideal location for a maritime cluster as it forms to meet the new supply coming on-stream so lay-up is an agenda item the perfect cross roads from east to west – from Australasia, India and which will be talked about more and more over the next few months. Japan, Korea and China to Europe and beyond. Regional demand in Some harsh decisions will be taken. It is not necessarily the owner Vietnam, Malaysia and Thailand as well as Indonesia and Australia who will take the decision but the operating company with the debt,” means that geographically, Singapore is very well placed to benefit. Denis Petropoulos said. But you don’t come to Singapore just to do business with Singapore; Shipping does have its cycles and unpredictable events can change you base yourself in the area because you want to do business in the freight market directions but the fundamantal demand for raw materials whole region, which inevitably includes China and India. That means and energy services is constantly growing in Asia and Braemar remains networking, visiting clients and clients visiting you. Singapore is a hub upbeat about the medium-to long-term future in these regions. ■

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 29 DISPATCHES DISPATCHES SHIPPING BUSINESS REPORTS FROM AROUND THE WORLD Grappling with a bittersweet

solutionBy Thomas Ország-Land

he shipping industry has become Considering the cumulative effects of suggests that, in the absence of corrective the first to introduce mandatory many different mounting stresses action, ship emissions might increase by up Tglobal greenhouse gas emission simultaneously affecting the oceans, its to 250% in less than 30 years. But big cuts standards. The principle of extending authors have expressed surprise at the in the pollution yield of ships could be enforceable environment protection rules accelerating rate and magnitude of the achieved by affordable improvements in to the high seas meets one of the crucial deterioration of the marine ecology. They engine efficiency and hull design and calls made by the world’s top marine have also issued an urgent demand for coating as well as waste-heat recovery ‘scientists in a grim new analysis of the improved governance of the largely ’systems. state of the oceans. But a likely delay in the unprotected high seas that comprise most of The IMO decision amends the implementation of the pollution abatement the oceans. MARPOL accords included in the principal accords could lead to serious friction. Many environment protection pressure international convention for the prevention Negotiated under the auspices of the groups have welcomed the IMO energy of ship generated pollution. It requires ship United Nations’ International Maritime efficiency accords as a significant move in owners to introduce an Energy Efficiency Organization (IMO), the environment that direction, especially during the current Design Index (EEDI) for new ships, and a management deal requires all new ships sluggish global climate negotiators. But Ship Energy Efficiency Management Plan above 400 tonnes delivered after 2015 to they warn that their real foreseeable (SEEMP) for all vessels. Other improve their energy efficiency rates by consequences will be mostly symbolic, and amendments tighten the definitions and the 10%, rising to 30% by 2024. This may well that they must be seen as only the first of requirements for ship survey and result in the reduction of carbon dioxide many essential steps towards curbing the certification. (CO2) and other Greenhouse gas emissions adverse effects of the shipping industry on But there are substantial loopholes in by up to 50m tonnes a year by 2020, says the health of the oceans. the agreement that could delay its the IMO. Indeed, advanced proposals on further implementation. The highly respected The move coincides with the regulation to reduce emissions along the marine environment protection publication of gloomy conclusions in an major shipping lanes near the heavily organization Clean Shipping Coalition authoritative new scientific study compiled populated coastlines have just been initiated (CSC) is concerned that intensive by two of the world’s foremost nature by the European Union (EU). The bargaining at the IMO negotiating table in conservancy organisations concerned with industry’s first response is to reject them. London by China, Brazil, Saudi Arabia and the marine environment. It projects a phase At present, shipping is responsible for South Africa has resulted in significant of enormous extinction of marine species up to 4% of the total CO2 pollution exemptions for new ships registered in unprecedented in human history. generated by industry. A 2009 IMO study developing countries.

30 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 DISPATCHES

CSC last year won observer status at close to 11,000 volunteer scientists. The ocean ecosystems unless corrective action the IMO. A specialist at the campaigning IPSO is a consortium of marine specialists is taken now. organization explains: “If countries choose of many disciplines including industry, the “Their findings are shocking,” to apply the waiver for a newly delivered sciences, law, mass communications and observes Dr. Alex Rogers, Scientific ship then the application of the EEDI politics. The urgency of the demands issued Director of the IPSO. A professor of provisions will be delayed for six and a half after the conference reflects the sense of conservation biology at the Department of years. There is a further danger that many crisis that engulfed the deliberations of a Zoology, University of Oxford, he is very ship owners will elect to have their new recent Oxford symposium of scientists that familiar with the needs of ship owners as he ships flagged in countries that provide a produced the marine environment analysis. pursues a special interest in the sustainable waiver. The first guaranteed effective date use of the oceans and the impact of industry of the EEDI as a global shipping efficiency on the marine ecosystems. standard would thus be 2019.” “As we considered the cumulative Environment organisations also caution effect of what humankind is doing to the that, because the new standards only apply oceans, the implications became far worse to ships replacing older ones at the end of than we had individually realised. their very long lives (typically 30 years), Humanity is facing a very serious situation and because the waiver will defer demanding unequivocal action at every implementation for many new ships, the level. We are looking at consequences that full effects of the IMO accords will take a will impact in our lifetime, and worse, the very long time to make any significant lives of our children and the generations impact. beyond that.” Jacqueline Savitz, Senior Campaign And Professor Dan Laffoley, holder of Director for Oceana, comments: “The the marine chair of the IUCN’s World EEDI vote is bittersweet. There will be no Commission on Protected Areas, notes: change to existing ships that are currently “The leading experts on the oceans are pumping a billion tonnes of CO2 each year, surprised by the rate and magnitude of the and for new ships it will take another dozen changes we are witnessing. The challenges years until the EEDI is really delivering are vast, but unlike the previous benefits.” generations, we know what now needs to Bill Hemmings of Transport and be done. The time to protect the blue heart Environment, adds: “Adopting the EEDI is of our planet is now.” the right step but the long delay weakens its The study, “International Earth System short-to-medium term impact significantly. Expert Workshop on Ocean Stresses & If the IMO does not deliver action quickly Impacts”, examines the combined effects of on existing ships, then it will be up to the ship and land generated marine pollution, EU to take the lead at a regional level.” global warming, acidification, over-fishing Undue delay could lead to major and hypoxia (deoxygenation). It contains conflict. The scientific report issued jointly the synthesis of the views of scientists from by the International Union for the the top maritime research and training Conservation of Nature (IUCN) and the institutions who met to consider for the first International Programme on the State of the time ever the cumulative effect of all Ocean (IPSO), includes urgent demands for principal pressures brought to bear on the the following reforms in marine oceans by humanity. environment regulation and management: They concluded that marine species are ● The immediate introduction by the at risk of entering a phase of huge UN Security Council and its General extinction. Their study warns that mankind Assembly of effective governance of the Humanity is facing a very has created all the conditions associated high seas beyond the jurisdiction of states. “serious situation demanding with every previous major extinction of This should be implemented by a global species known to science. entity empowered to ensure compliance unequivocal action at every For example, the levels of carbon with the Law of the Sea Convention and absorption by the oceans are already far other relevant legal norms and duties and level. We are looking at higher than at the time of the last mass to establish new rules, regulations and consequences that will impact extinction of marine species some 55 procures to enforce them in a precautionary “ million years ago. Up to half of some manner. in our lifetime, and worse, the groups of deep sea animals were then ● The immediate reduction of CO2 lives of our children and the wiped out. emissions coupled with significantly “As a result,” the study goes on, “the increased measures for the mitigation of generations beyond that first developments leading to a globally atmospheric CO2 Dr. Alex Rogers, Scientific significant extinction process may have ● A reversal of the conventional legal begun.” It adds that the speed and the rate burden of proof to ensure that all maritime Director, IPSO of the degeneration of the ocean ecosystems activities are allowed to proceed only if are far greater than envisioned even by the they are shown not to harm the environment Its participants reviewed more than 50 worst previously issued scientific either singly or in combination with other of the latest research papers on the predictions. And it warns that the oceans activities. environmental stresses affecting the oceans. may prove unable to recover from such a The IUCN is a global network of more And they issued a desperate prognosis of disaster under the relentlessly intensifying than 1,000 specialist organisations and the consequent accelerating decline of the present assault of environmental stresses.

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 31 DISPATCHES

The world shipping industry has abatement programme – on the grounds grappled long with the issue of marine that the EU runs a regional scheme pollution (see SMI, issue 11/2008). The necessarily unsuitable for regulating a International Chamber of Shipping and the global industry like shipping. The EU International Shipping Federation have initiative announced by Janez Potočnik, the both welcomed the IMO reforms after a Environment Commissioner in Brussels, long and hard campaign in their favour would reduce the permitted volume of (SMI, Issue 32/2011). And the UK Chamber sulphur dioxide (SO2) emissions of ships by of Shipping has just issued a statement up to 90%, and of fine particle emissions by urging the industry “to keep the door open up to 80%. on all options to drive a reduction of its Potočnik explains: “Air pollution does carbon emissions“. not stop at the coastlines. Land sources The British chamber believes that the have been subject to the attentions of industry must now advance beyond the regulators for some time. The time has now pollution-cutting technical improvements come for the maritime sector to deliver its envisaged by the IMO accords by adopting fair share of emission economies, all the additional economic measures to meet their more so as the impacts on air quality are felt targets and expectations. It says far beyond the coastal areas.” international opinion within the industry is An EU briefing paper elaborates that already divided between the following two ships traditionally use heavy fuel oils for schools of thought on how best to reduce propulsion with a sulphur content of up to ship generated pollution: 5% (compared to a maximum 0.001% One favours the establishment of a CO2 permitted in the fuels consumed by trucks contribution fund to be financed by or passenger cars). SO2 emissions cause shipping companies as part of their bunker acid rain and generate a fine dust dangerous fuel purchases. Its advocates argue that to human health, causing respiratory and such a relatively straightforward approach cardiovascular diseases and reducing life would provide a measure of price certainty expectancy in the EU by up to two years. for the industry. The other would prefer an emissions The environment commissioner wants trading system, with shipping companies the maximum permissible sulphur content purchasing permits to offset the cost of of maritime fuels used in sensitive areas pollution generated by their vessels. Many The EEDI vote is such as the Baltic Sea, the North Sea and argue that such a financing mechanism the English Channel to fall from 1.5% now “bittersweet. There will be no to 0.1%, starting on January 1st 2015. Other would create strong incentives for cutting pollution. change to existing ships that areas would achieve a bigger cut, from Mark Brownrigg, Director General of 4.5% to 0.5% by the year 2020. the British chamber, argues thatt the issues are currently pumping a Ships would be allowed to seek are complex and must be considered billion tonnes of CO2 each emission economies through the internationally and on many levels through introduction of appropriate technologies the IMO. He projects a lively debate over year, and for new ships it will including exhaust gas cleaning systems as “which option will provide greater certainty take another dozen years“ an alternative to using low sulphur fuels. of outcome and ease of application without until the EEDI is really These changes are intended to fall in line damaging the growth of the industry and with the new IMO accords. world trade”. delivering benefits THOMAS ORSZÁG-LAND is an But he has roundly rejected current Jacqueline Savitz, Senior author and award-winning foreign proposals to bring the shipping industry correspondent who writes on global under the EU’s expanding pollution Campaign Director, Oceana affairs. ■

32 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 DISPATCHES

MyView

By Peter Hinchliffe, achieved, naval architects and ship advisory group which the UN Secretary builders may employ whichever solutions General convened. Secretary General of the they deem fit. “The European Commission or International Chamber of “The regulations were absolutely perhaps more correctly the European what this organisation had hoped for and Parliament, makes a habit of trying to Shipping (ICS) the IMO’s decision is an important one, force the IMO’s hand; we saw it done not just for the shipping industry, but I over recent fuel sulphur content think it shows that a consensus can be “While it is clearly in the interest of achieved on climate change within an legislation and we are seeing it again over shipping to minimise its CO2 output by international debate. It’s a global first and CO2 emissions. reducing fuel consumption, recently because the IMO has done this for “Although people imagine that this agreed amendments to Annex VI of operational and technical measures, this could mean the inclusion of shipping in IMO’s MARPOL Convention which – on means it can generate the will to do the European Emission Trading Scheme a global basis - will make the Energy something about market-based measures like international aviation, in practice it Efficiency Design Index (EEDI) as well,” he stressed. is clear that Europe does not really know mandatory for new ships, and the Ship “The shipping industry will fully how to deal with the complexity of Energy Efficiency Management Plan support measures which are ‘parented in shipping. CO2 emissions from (SEEMP) mandatory for existing vessels, the IMO’ and I am confident that the international shipping cannot be reduced were ‘absolutely’ what had been hoped impact on world trade and on the business effectively and meaningfully through the for by ICS. of shipping will be taken into account. I “The EEDI is a non-prescriptive am not confident that these factors would incorporation of shipping into any requirement, as the decision over which be taken into account if the debate occurs regional financial instrument. Therefore technologies to use within a specific ship at the United Nations Framework ICS is strongly opposed to the application design are left to the industry. So long as Convention on Climate Change or as a of any regional Green House Gas scheme the required energy-efficiency level is result of the outcome of the high level to international shipping.”

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 33 MARKET SECTOR TRAINING & CREW RETENTION

By Samantha Giltrow

“digital revolution” is almost upon Headland Media, which provides its “The ILO Maritime Labour the shipping industry as the sea services to around 225,000 crew, Convention is probably the single most Aplays catch up to land-based announced recently that, through its Crew important international regulation affecting technology. Media Player, it has become the only manning and labour affairs that has been The use of broadband and high-tech licensed provider of English Premier seen for many generations,” said Nigel communication devices is becoming vital League football coverage to merchant Cleave, Chief Executive Officer at UK- as shipping companies battle to retain good seafarers and with this, crew members can based Videotel. quality crew and it’s not just about see every goal from every game. “It covers every aspect of the manning providing a service so they can keep in In addition to the EPL, Crew Media of ships, from employment conditions contact with home, according to Sue Player delivers a wide range of unique to medical standards, and from crew Henney, Marketing Manager for Headland licensed video and audio content including accommodation to work hour regulations. Media, which provides news, entertainment news and sport from home as well as vital “We feel that the extensive training and training services for seafarers. safety training and welfare briefs. The needed should be conducted in real time by “With VSATs (Very Small Aperture service can be completely customised so it a senior course tutor with significant Terminal) becoming more affordable and suits the nationalities of crew onboard experience in the field. However, the range Inmarsat competing with ‘all-you-can-use’ along with the company’s requirements of roles and responsibilities held by course packages, we are on the verge of a digital and budget. participants also demands that the training revolution at sea, which will see the Mark Woodhead, Managing Director at be flexible and available on demand. maritime sector follow the land-based Headland Media, said: “We are extremely The Videotel Academy tutor-assisted trends from the mid 1990s,” she said. proud and excited about Crew Media Player CBT training combines distance learning “As the methods become more and being able to provide English Premier techniques with the traditional advantages commonplace, we believe the focus will League football highlights to seafarers.” of the support and interaction provided by inevitably move to content, for example Real-time tutoring is another key area learning in a classroom environment. media and services, which can be delivered where new technology is bringing about “Students really benefit from the ability via those routes.” huge change. Crew members no longer to communicate ‘face to face’ with their Whether it’s being able to watch their have to be put into onshore training centres, course tutor and receive mentoring and favourite football team in action on TV, or often at great expense, to further their academic support in real-time,” added taking part in training programmes, careers and learn about aspects of health Mr Cleave. seafarers’ demands are relying more heavily and safety onboard. And the emphasis on The course, which starts this month on vessels being kitted out with the most up the flexibility and usability of this type of (October), is online and follows a structured to date equipment. training will be even more crucial when learning programme lasting 12 weeks with “Manpower reports indicate there is a ship operators soon have to comply with the students being encouraged to engage in deficit in current officer numbers and obligations of the International Labour online discussions with the course tutor, changes in crewing patterns, demographics Organization’s (ILO) Maritime Labour David Dearsley, and fellow delegates to and crew sizes put more pressure on Convention. share experience and knowledge. shipping companies to meet the In preparations for the MLC, Videotel Mr Dearsley has over 45 years’ expectations of good quality crew,” said Ms Marine International has launched the experience in the shipping industry, 25 of Henney. Videotel Academy MLC 2006 tutor- which he worked as Deputy Secretary “New cadets and, increasingly, others assisted computer-based training course, General of the International Shipping often require the same level of access to the first programme of its kind in the Federation (ISF) where he was responsible technology and services that they have industry and the first of its kind to offer for co-ordinating the global shipowners’ on land.” online tutoring across the globe. position on initiating, reaching agreement

34 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 TRAINING & CREW RETENTION MARKET SECTOR

on and then drafting and developing text for Norwegian-based Seagull, another the job they do, and it must keep and report the Maritime Labour Convention (MLC). player in computer-based training systems accurate records and statistics. Videotel delivers training to some for seafarers, says one of its greatest “Our approach does not have an online 10,000 vessels and through its Videotel on strengths has been its ability to look at instructor but for many years has exceeded Demand (VOD), and more recently current needs and project future needs for this approach since we have always made introduced networked version (NVOD), it technology in training. the ship the classroom with a combination is incorporating increasingly sophisticated “Computer-based training onboard of eLearning, course materials, and software allowing training to be carried out matched our ability to leverage available shipboard mentoring from senior officers by multiple users onboard, working technology with an eye on new technology who, as the mentor instructors, create a very simultaneously on different programmes, like maritime broadband. This core powerful experience to give hands-on and recording the actual training performed competence is at the heart of our company. training on the equipment. and synchronising this in the ship owner or For example, we pioneered several years “This creates the environment of direct ship manager’s office. ago the ability to have training records job relevance and the immediate ability to “We do see development with regard to follow the seafarer from ship to ship,” the get the answers from the experienced broadband, albeit the industry is still some company said. officers.” way off replicating what a crew member “Through our dependable data transfer He too believes that more may enjoy at home in terms of internet capability, the information is replicated to a improvements will be made with broadband speed and cost,” said Mr Cleave. central data base and can be retrieved simply which will enhance what is being offered “The main benefit at present, so far as and dependably each time it is needed. Not onboard. Videotel is concerned, is the ability to surprisingly, some others have found this a “Broadband is an important technology record the training performed, so essential technological challenge and still cannot that, over the next few years, will be today in terms of monitoring crew dependably do so.” increasingly valuable on many fronts, such development and providing evidence of Although Seagull does not offer a real- as operations, quality of life of the seafarer, such training to various authorities.” time training product it believes its way of and training. We are in front of this curve Along with the Videotel Academy offering distance learning is just as effective. by making all of our training titles and Learning Management System (LMS) Lance Savaria, Director, Sales and software available online now. So, the platform, which the online MLC 2006 Marketing, said: “Real-time tutoring is an adaptation to a pure broadband format is course is part of, Videotel also provides, interesting change from the shore-based seamless.” through its BIMCO’s eLearning Diploma classroom courses. Traditionally, schools Mr Savaria said there was no doubt (BeDP) course, a joint venture with the have been limited to the number of seats in training was moving more to onboard shipping association, comprising a highly- the classroom and deliver a mixture of learning, as companies looked at the cost- focused, web-based, e-learning package. general knowledge and the shared effectiveness it provided, and Seagull now “Both provide everything you need to experience of the instructor. had over 7,500 installations worldwide. study your programme, communicate with “We have found that seafarers “With our major customers in all the your tutor, upload your assignments, chat appreciate our approach to their training. It maritime fleets, including tankers, bulkers, with your fellow delegates and research answers the problems they face. It is cruise ships and offshore support vessels, additional material to enhance your important that the training is easy to there is no limit to applying our training studies,” said Mr Cleave. understand and use, it must be relevant to system to various types of ships.

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“I think on the face of it, by the IMO, flag states, maritime training the correlation between a institutions and major shipping companies challenging economic around the world. environment and And onboard courses were proving commitment to training is popular with crew members too as they generally misunderstood and looked at gaining a better quality of life away training becomes very from work. important. The question “Time at home is now more important becomes how to deliver that than great wages so, when asked to go to a training efficiently and traditional classroom school or participate in effectively. an instructor-led course online it infringes into “Make no mistake, their personal time.” onboard training is by far the As mentioned previously, keeping crew most cost-effective training happy while they are onboard is increasingly solution – up to 75% less important in attracting and retaining seafarers. “We are growing at a steady and expensive. It is also highly effective training With the doom and gloom of the global sustainable pace. Our goal is to be adaptable and, in my opinion as an officer, more economic downturn has there been a cutback and provide answers to our customer’s effective and relevant to the seafarer.” in providing benefits such as internet access challenges with effective solutions. The Videotel’s Mr Cleave agreed: “While, and entertainment? training we provide fits into and assists the quite obviously, the market is suffering in Nicola Boarer, Marketing Manager for entire career cycle of general, we continue to observe that many London-based onboard movie provider the seafarer and the promotion-ready responsible ship owners and ship managers Filmbank, believes not: “Although budgets assessment and appraisal throughout their have taken a pragmatic view in that training are limited, the recession does not seem careers.” of crew still remains a high priority. to have had an effect on onboard He added that Seagull’s customers, “We view all training as a blended entertainment. Keeping the crew happy is particularly in the current environment approach, each complimenting each other. extremely important, and film is truly a cost where there is a shortage of talent, were There can be no doubt that onboard training effective way to keep them entertained.” concerned with promoting the best people saves considerable expense in terms of travel Filmbank supplies movies and TV and need the ability to do so effectively and and accommodation when compared content for screenings outside of home and efficiently. with attending a shore-based training cinema and the maritime sector, which it has However, he believes there is still very establishment.” served since the company’s inception 25 much a place for being able to learn onshore. However, he said he could not foresee years ago, is an important market with a wide “While the trend and desire is definitely much growth in the training business in the range of Hollywood, Bollywood and TV towards onboard training, there is still a need short term: “With supply outweighing shows on offer. for flexibility onshore and our courses easily demand at present, it is difficult to imagine Customers are mainly in Europe and provide that flexibility – training that can be growth within the shipping sector over the include ferries, merchant vessels and some completed anywhere, anytime.” next 12 to 18 months. Nevertheless, Videotel cruise ships and with the profile of a typical But, with the current economic climate will continue to invest in its research and viewer being a male aged 18-30, the most still proving a battle ground for many development where we have some quite popular genres are thriller, action and horror shipping owners, is training suffering as exciting plans ahead.” with movies generally available on the date purse strings remain pulled tight? On the Mr Savaria said Seagull’s view, that of home entertainment release and some even contrary, said Mr Savaria. onboard training was the future, was shared available before general DVD release.

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“According to customers it is vital that crew are able to relax when off duty and have access to good entertainment options. Film nights provide an opportunity to socialise with colleagues which is very important,” said Ms Boarer. This view was echoed by Sue Henney, of Headland Media, which, along with offering all the action from the English Premier League, provides many onboard services including access to international news, sport and training through its digital Crew Media Player and movies. “We have official maritime licences with the major movie studios, which provide us with latest release DVDs before they are Arise ‘Class of 2011’ available on land. Currently, we generally Left to right: Edel Seidenschnur (Chiarman of the Blue MBA Advisory Board), Per Gullestrup (CEO and post out the actual DVDs on a monthly basis Partner, Clipper Group A/S), Peter Schütze (Chairman, CBS Board), Alan Irwin (Acting President, CBS), Irene to the ships, although we do have capability Rosberg (Director, The Blue MBA) to provide the films digitally where the t was hats up into the air for the 29 write an assignment on a company-based infrastructure onboard allows this.” graduates of the Executive MBA in issue to which they can apply what they Its Crew Media Player is ideally suited Shipping and Logistics (Blue MBA) at have learnt,” she said. for ships with larger bandwidths and I the Copenhagen Business School (CBS) The MBA programme has been capacities. last month (August) as they graduated as designed to give participants an up-to-date “It enables shipping companies to get the the successful class of 2011. insight into shipping economics and most out of such technologies for the benefit Among those receiving their scrolls modern management theories and their of crew and company alike,” said Ms was Robert Thompson, First Deputy application in the maritime sector. It adopts Henney. “Crew Media Player offers a Managing Director of Unicom a holistic view of shipping, integrating controlled, optimised digital video news, Management Services in Cyprus, as well as commercial, technological and financial sports and information channel for improved senior executive colleagues from shipping aspects as well as maritime law, supply seafarer morale and better staff and transport companies across 18 different chain management and leadership communication.” countries. challenges. It takes students to a Managing Director Mr Woolhead added: According to Irene Rossberg, top international level in business “We feel that Crew Media Player takes the Programme Director at the CBS, the administration, reflecting the needs of the provision of media content to a new, exciting programme has been designed specifically industry in a world where globalisation, digital level that sill supply the modern with the senior executive in mind. “This is enhanced competition and the speed of seafarer with the comforts of home, at sea.” a modular programme designed for senior technological change place ever increasing Over 9,000 vessels have taken up managers with very busy schedules. You demands on executive management skills. Headland Media’s services including tankers cannot expect these people to take a whole Alan Irwin, Acting President of the and container ships, though “some year off work to do an MBA, so it has to be CBS, said of the course: “It has got larger companies will always spend more than designed to be completed by a busy and we have more experience from others on crew,” she said. individual sitting in a decision making colleagues in industry who have been “Ultimately, a well-rested and happy senior position. The students have eight one involved. We have also got closer in terms crew is a necessity for the smooth running of week models spread over two years and of the advice we get from them but the a ship and more shipping companies are they met for those modules where they are industry is changing and it is crucial we go beginning to see the positive aspects of taught the theory. Once the module is with the changes, which is important for investing in the crew’s well-being.” ■ finished they go back to their countries and global business.” ■

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through

he ability of Belgium and The Rotterdam's positive development is forum, this was especially Netherlands to survive what is the connected strongly to world trade, especially due to the port’s “improved Tworst shipping crisis to hit for that related to China and Germany. The climate for innovation”. decades will rely as much on prosperity in significant unrest on the financial markets This innovative approach the world’s main producing areas like the and its influence on the trust of consumers has served the port well, as Far East as well as its determination to and producers can have a negative influence according to its most recent remain committed to what it does best. on world trade and thus on our throughput. set of results, 215m tonnes of Shipping service companies in the region “There is a significant need for quicker cargo were handled at the port believe that in order to continue to yield and clearer political decision-making to sway in the first half of 2011 – 1% success in the face of a wary customer base negative sentiments. I expect that throughput more than in the first half of and harsh global shipping market, a focus on in the third quarter will stay on target. July 2010. The total, net result for innovation and port growth will be key was a good month and the cargo for August the port totalled €98m, an elements in the fight to remain on top. and September is already anticipated. In spite increase of €8m compared to Acknowledging that the Port of of insecurity about the fourth quarter, I expect the first half of 2010. Incoming Rotterdam has vast benefits for the Dutch throughput for the entire year to show a cargo increased by 2% to 153m maritime sector, Theo Nieboer, Managing light growth.” tonnes but outgoing cargo Director of crewing company Oceanwide Every year, 34,000 sea-going vessels and decreased by 1% to 61m Netherlands, said that when it rains in 100,000 inland vessels call at the Port of tonnes. The throughput of Rotterdam, it drips in other parts of the Rotterdam – one of the busiest ports in the bulk cargo fell by 4% to country because “Rotterdam is the engine of world and a gateway to the European market, 140m tonnes, while the Dutch maritime economy. The port where over 350 million consumers reside – general cargo was creates many jobs in the maritime cluster and with an annual throughput of around 430 12% higher at with flexibility and labour mobilisation as a million tonnes, this port remains at the 75m tonnes. result. This means a lot of seafarers switch forefront of the Dutch industry by ensuring a There were after being at sea for some time to interesting steady flow of business for all maritime decreases for the maritime jobs ashore.” He also noted the stakeholders. throughput of iron ore importance of investment in the port and In September, the Port of Rotterdam was and scrap metal (- cited current developments within the named as having the best port infrastructure 7%), crude oil (-8%) Maasvlakte harbour and industrial area as in Europe by the World Economic Forum in and mineral oil vital to ensure more berths for container, bulk its ‘Global Competitiveness Report 2011- products (-9%) but and LNG vessels. 2012’. The Port of Singapore was named best the remaining cargos Describing his intentions to ensure in the world owing to its wet infrastructure saw positive continued and steady growth at the port, Hans while The Netherlands came second on the increases – agribulk Smits, Chief Executive Officer of the Port of global scale, followed by Hong Kong. In (+26%), coal (+6%), Rotterdam Authority, said political co- terms of ‘total competitiveness’, The other dry bulk operation will be key to the future success of Netherlands moved up from eighth to seventh (+21%), other liquid the Dutch maritime industry: “The Port of place – and according to the World Economic bulk (+1%), roll

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on/roll off (+6%), other general cargo development, maritime logistics will be grow, despite some common global (+28%) and containers (+12%). Container affected as well. In case of oil products challenges: “Relative to other European throughput increased by 10% to six million (mainly petrol) this cargo flow will maintain countries, the Dutch economy is still strong. TEU (20 foot equivalent units). a certain stability. For containers and break At the same time, the Dutch maritime market Koen Overtoom, Managing Director, bulk the influences of a decrease in demand faces demanding regulatory rules and a high Commercial Division at the Port of will be felt,” he said. cost base. A great number of Dutch maritime Amsterdam, said that his port has also seen a Located at the economic heart of Europe, companies have managed to overcome such “fine result” so far this year, with a 3% rise in the Port of Amsterdam handles over 90 challenges through specialisation, innovation cargo growth. “Growth involved oil products, million metric tonnes on an annual basis and and becoming best-in-class. It is because of cars and other roll-on/roll-off products in has facilities for handling, storing and this approach that the Dutch maritime particular and we have had a wonderful half transhipping a wide range of goods, including industry is expected to outperform the year in terms of sea cruise activities,” he said, cocoa beans, coal, paper, oil and millions of average trend.” adding that the Port of Amsterdam expects tonnes of dry and liquid bulk, general cargo Mr Visser added that the “challenging the current transhipment to and containers. environment” Dutch maritime companies stabilise in 2011. Describing the Port of Amsterdam’s face has led them to “become experts in a “Several relevant customer service ethos as “the red carpet clearly outlined core business”. He cited sectors are still treatment”, Mr Overtoom said the port examples such as Dutch dredging and heavy struggling with the “continuously works on the maintenance and lifting companies as innovative sectors and crisis, but hopefully improvement of its infrastructure and said some Dutch shipyards are still seeing a the port will continue accessibility”. Together with the Dutch healthy number of orders. “Stricter to benefit from the government, Province of North-Holland and regulations are great opportunities if multi- cautious economic the City of Amsterdam, the Port of laterally adopted, because we have some of growth that is Amsterdam has made an agreement the most flexible and innovative companies expected this year. concerning the funding of a large new sea in the maritime world,” he said. “On the other We expect that lock, the purpose of which is to simplify hand, if regulations are adopted solely on a with any fall access to the Amsterdam port region. Under national basis and in varying ways it will not in economic the terms of a covenant, the new lock will be create the level playing field which is key to operational from 2016. success in this international and competitive Noting that the Port of Amsterdam business.” intends to be one of the most sustainable The Dutch maritime industry has ports in Europe by 2020, Mr Overtoom cited survived well trough the recession, but how the importance of clean operations and are low charter rates influencing the industry? intelligent use of the port, cargoes and Mr Nieboer again: “The sector faced some location. He described the Port of problems in general cargo and container Amsterdam’s Sustainability and feeders, but most vessels are sailing again. As Innovation Fund as an example the Dutch fleet has a lot of specialised of a positive green initiative, vessels, from large passenger vessels to a whereby companies within the fleet of dredging material and specialised port region can apply twice a year offshore vessels the risks were spread. for subsidies towards projects for Traditionally The Netherlands has no sustainable and innovative companies with big bulk carriers and large development in the North Sea (the VLCC tankers like the Greek companies port makes €2m available a year have – sectors which faced problems. for this fund). Business is going up, but very slowly. For As Dutch ports continue to some kinds of vessels, day rates are still very flourish, other maritime companies low and hardly enough to cover the in the region are benefiting from an operational expenses,” he said. increase in port traffic. Sijmen Describing a shortage of experienced Visser, Global Segment Manager, marine engineers, Mr Nieboer said that on Marine Maintenance & Repair, occasion, Oceanwide Netherlands has missed from PPG Protective & Marine a couple of business days in order to wait for Coatings, said the Dutch maritime “the right crew”. Though Mr Nieboer industry offers opportunities to described a shortage of marine engineers as a

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On a positive note, maritime companies with headquarters in Rotterdam can also easily benefit from an increase in customers by serving Belgian ports. As the Port of Antwerp is only one hour’s drive away, those based in Rotterdam can provide goods and services to this bustling Belgian port with just a simple commute – something which many Dutch companies take part in every day. Much like its Dutch competitors, the Port of Antwerp has delivered a robust set of results, having handled almost 96m tonnes of freight in the first six months of 2011 – representing an increase of 10.4% compared with the first half of 2010, when volume levels reached 87m tonnes. According to officials, the port is recovering “particularly worldwide problem – even in countries tough. “What I see happening in future, is well after the recession” having exceeded the such as India and the Philippines, where that the smaller ship chandlers will have record level (in tonnes) previously reached in more students are choosing to become trouble complying with all the rules and 2008. The total number of ships calling at the nautical officers instead of engineers – he regulations and they will seek some kind of port rose by 7.3%, to 7,745, compared to the said that marketing initiatives by The Royal venture with larger ship chandlers. We took first half of 2010. Association of Netherlands Shipowners over a smaller ship chandler less than a year Last year, Antwerp experienced the (KVNR) and Dutch Maritime Colleges ago, purchasing the majority of shares. For strongest growth on the Hamburg-Le Havre have made promising efforts to encourage a small ship chandler, it’s easier to be linked range while an increase in conventional young Dutch people into marine engineer to a bigger chandler who has, for instance, (break bulk) freight was also reported, with a training. already achieved an AEO certificate and total of 6.4 million tonnes (an increase of Agreeing that Rotterdam is a huge port has put in place sophisticated software for 16.9%) more being loaded and unloaded of opportunity for maritime companies, quotation and order processing – they can from January to June than in the same period Eric Bezemer, Commercial Director of link up and benefit from greater purchasing of the previous year. This includes 4.4m Rotterdam-based NEKO Ship Supply, said power and be more competitive for the tonnes of steel, marking an increase of almost that competition at the port is especially future.” 48% on the previous year and fruit cargoes have remained buoyant throughout the recession, with volumes increasing by 3.2% to 0.7 million tonnes. The Port of Antwerp has also reported positive half-yearly results in the ro-ro sector, with 526,841 cars loaded or unloaded during the past six months. Bulk freight has also been doing well, with liquid bulk rising by an impressive 31.8% in the first half of this year to 24.2m tonnes. Antwerp’s position as the largest integrated petrochemical cluster in Europe has also been assured, and the expansion of storage facilities for oil derivatives has allowed this cargo to expand by 42.2% in comparison with the first half of last year, while crude oil (2.5m tonnes) and chemicals (5.8m tonnes) also expanded, by 17.1% and 16.8% respectively. Though the port may be booming, how are Belgian maritime companies progressing through the recession? Headquartered in Antwerp, Compagnie Maritime Belge (CMB) was founded in 1895 and specialises in dry bulk through its wholly owned subsidiary company, Bocimar International – a company mainly focused on the transport of coal, ore, grains and other dry bulk goods. Presenting its results for the first half of 2011, CMB reported a consolidated result of over €19m (2010: almost €86m); an annual turnover of over €237m (2010: over €217m) and EBITDA of almost €77m (2010: almost €76). Bocimar’s contribution to this overall result stands at €32.881m, compared with €42.689m in 2010. This included €9.9m of capital gains from the sale of two vessels, though during the first half of 2011, five handysize vessels joined the Bocimar fleet – the CMB Boris (33.717 dwt), the CMB Julliette (33.684 dwt), the CMB Virginie (32.626 dwt), the CMB Yasmine (33.647 dwt) and the CMB Ariane (33.660 dwt). In a statement, CMB added: “Unless scrapping accelerates substantially and seaborne trade increases above average, Bocimar expects the dry bulk markets for the next twelve to eighteen months will remain at low averages. Also second-hand values that are already 15% to 20% lower compared to the start of the year will further erode unless the market picks up.” Promoting the Port of Antwerp on a global scale will be key in ensuring future positive results for the Belgium maritime industry, but in order to ensure the nation takes full advantage of its import and export capabilities, Belgium will also need to ensure its inland waterways are fully operational and in-line with demand. As Isabelle Ryckbost, Director of the European Federation of Inland Ports (EFIP), explained, it is expected that by 2050, eight out of every 10 individuals will be living in urban areas and the need to bring goods in and out of European cities in a sustainable and efficient manner will be a key challenge for the future of shipping and logistics. On September 16th, political and port authority representatives from the waterborne cities of Brussels, Berlin, Budapest, Paris and Vienna signed a charter to activate their waterway connection, with the aim of achieving sustainable and efficient city logistics. These cities have confirmed their collective intention to enhance the role of waterway transport for passengers while also achieving CO2-free freight supply, distribution and logistics. Brigitte Grouwels, the Minister responsible for the Port of Brussels, said: “The port of Brussels has an ideal location at the heart of the international transport hub which offers connection to three other transport modes, notably to the motorway network, through the Brussels orbital motorway (known as the Ring), to the railway network, by means of a connection to the container terminal and to the air transport network. By signing this charter, we undoubtedly take a big step towards a more sustainable future, both from an economic and an environmental point of view. We also make the link with other ports.” ■ TANKERS TRADE ANALYSIS Thetruth behind China’sordering VLCC plans

he tanker markets were reported to ship owners will have to contract 60 new orderbooks comprise only 13% of the have been spooked in early VLCCs for delivery in those coming years. global VLCC fleet and orderbook so there TSeptember by the rumour that To ensure that there is sufficient supply is clearly room for more Chinese-controlled Chinese oil companies may order up to 80 of VLCC tonnage to maintain reliable, tonnage. VLCC newbuildings from Chinese yards. consistent and affordable supplies of crude Chinese shipyards delivered 21 VLCCs But should anyone really be overly oil, China may wish to have a surplus of in 2010 and have delivered another 21 in surprised? tonnage, particularly if also incentivised to 2011 to September 1st with a further 10 due According to Braemar Seascope, maintain its growing skilled workforce at for delivery this year. In 2012, 29 are China’s priority throughout its urbanisation the shipyards. So 80 VLCC contracts, expected, followed by 23 slots currently and industrialisation process has been to although a little excessive, are feasible. filled for 2013. If China is capable of secure reliable, consistent and affordable The Chinese shipbuilding industry has delivering 30 newbuilding VLCCs a year supplies of raw materials and energy. To been upgrading its VLCC building with current shipyard capacity, and if 20 a meet this end, it has developed trading capability with a view to competing with year of these are for Chinese buyers (who companies, mining and resource others and no doubt also in order to meet currently only have eight VLCCs on order, companies, shipping and shipbuilding China’s own requirements. According to remember), then realistically it will be 2014 companies. This is a country run by a Braemar Seascope research, mainland before Chinese companies start to take strategically minded government with their Chinese companies own 39 VLCCS and delivery of the extra VLCCs required to engineers holding detailed plans for currently have just eight on order. These maintain the 50% policy, and 2017 or 2018 development. can be supplemented in part by 24 Hong when the programme completes, which China has a stated policy that 50% of Kong–owned VLCCs, with another 17 on fits in with anticipated refinery its oil imports should arrive on Chinese order. These combined fleets and development plans. ■ controlled tonnage. According to Braemar Seascope analysis, almost 50% of spot VLCC VLCCs discharging in China in the first In numbers of ships VLCC Total half of 2011 were Chinese controlled (that Fleet Newbuildings also includes time chartered tonnage). But this does not mean that China will stop Hong Kong owners 24 17 43 building VLCCs, after all its oil import requirements are undoubtedly going to grow. Mainland Chinese 39 8 45 China currently refines about 8.5m bpd owners of crude oil, at least 7.5m bpd of which is imported by sea. Braemar Seascope Others 490 111 601 estimates that China is likely to increase refinery throughput to 11m bpd by 2015 Total 533 136 689 and that around 15m bpd is achievable by 2018, which would put China on a roughly equal footing with the US for daily refinery In percentage of Total throughput. An extra 6.5m bpd of imports by 2018, Hong Kong owners 5% 13% 6% depending on its source, would require about three modern VLCCs a day to meet seaborne import requirements, or about Mainland Chinese 7% 6% 7% owners 1,100 VLCC shipments a year. If each VLCC can make nine round trips a year from the Arabian Gulf to the Chinese coast, Others 89% 82% 87% about 120 VLCCs will be required between now and then. Merely to meet its 50% Total 100% 100% 100% Chinese-controlled imports target, Chinese Note – fleet excludes non-trading single hull ships

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 45 TRADE ANALYSIS TANKERS Stemming the number of old bulk carriers being scrapped. Mr Bottiglieri’s ‘fleet renewal with scrapping premium plan’ clearly didn’t receive the necessary industry support flow otherwise the dry bulk market would not be in the tonnage supply situation it is in, facing us.” It was difficult, he said, for and the chances of the tanker sector owners to operate a $140m following a similar line remains to be newbuilding when the market was seen. But as Mr Jensen stressed in a commanding $10,000 a day. “There conference call to press after Frontline’s are a lot of discussions going on about second quarter financials, there were postponements and what they can do. around 50 surplus tankers creating a There will be a lot of assets changing supply overhang in the Middle East hands. VLCC spot market each month, which if “Generally there will be Denis Petropoulos, Joint Managing addressed could ‘jump start’ freight rates postponements on the newbuildings Director, Braemar Seascope and turn around the fortunes of many side because it is very difficult to lay tanker owners. up existing tankers because they will t was almost a case of déjà vu when “With the latest fall in values it could lose the oil major approvals. But a Frontline’s Chief Executive Jens be possible to purchase 50 older double- newbuilding coming out of the yard IMartin Jensen was quoted in the hull VLCCs at around $1.5bn,” he said. could be put into lay up. There have maritime press in the middle of August Frontline itself reported a $35m loss been slowdowns in deliveries and any claiming that maybe owners in the very for the three months between April and lay up in the market will affect large crude carrier market should take a June. It still owns three single-hull newbuildings. It has not started to $500 million gamble and scrap 50 older VLCCs but the ships are being used for happen, yet but you don’t lose double-hull vessels in order to help ease floating storage and will never return to anything by sitting around and we oversupply in this sector. conventional trading always prefer to wait for the right Those amongst us with long As Mr Jensen told SMI: “Demand is voyage rather than just take the first memories will recall a similar plea in picking up but the most disappointing cargo available,” he said. 2009 by prominent Italian bulk carrier market is of course the US market so Denis Petropoulos, joint owner Giuseppe Bottiglieri for bulker there are a lot of tonne miles that have Managing Director of Braemar owners to ‘challenge the crisis’ by disappeared. But overall the oil market Seascope Ltd and Executive Director renewing the quality of the global dry has gone up from the big step back at the of Braemar Shipping Services plc, cargo fleet while also boosting the end of 2008 but we have a big orderbook said there was a general

The retaking of Tripoli and Libya by rebel forces could provide a boost to the tanker markets. But in the current shipping climate, how deep will that improvement be felt?

Even if there is stability in Libya, no poised to be really strong then the Libya one expects a quick turnaround in oil factor would be very “ pronounced. In production“ and exports. Current terms of tonnage Libya isn’t big enough production is virtually nil, with some to affect the market. suggestions that it may get up to 300,000 Denis Petropoulos, Braemar barrels per day this year and 500,000 Seascope Ltd barrels per day by mid-2012, with the The suezmax and aframax

climb back to the pre-crisis level of 1.6 markets“ are where the Libyan market million b/d taking a further six to 12 has traditionally been but I think

months. This means full output would those markets will benefit from not be achieved until 2013 and leave the“ having those supplies back again.

Mediterranean Aframax market I think it will take some time but

‘restricted’ for some time to come. it will have a positive effect on EA Gibson shipbrokers report aframaxes and suezmaxes“ It is a small part of the market and and then indirectly that will“ reduce tonnes miles because crude should benefit VLCCs. will not need to be supplied from other Jens Martin Jensen, areas but it will take the instability out. If CEO Frontline we were in a marginal market that was Management

46 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 TANKERS TRADE ANALYSIS

ordering and will continue to order in a market which is already oversupplied. Torm completes LR1 That is the only surprise. It is because pool strategy some people were tempted to order in a much stronger market. Not everyone TORM has now completed the ordered ships and cash is now burning Company’s LR1 pool strategy in holes in some people’s pockets. Placing accordance with the overall business orders now with delivery in two years strategy “Changing Trim”. time might not seem a bad idea but there The company pioneered the is tonnage being built now that will be formation of Pools in 1990, and the failed in two years time because the concept has been very successful for market won’t sustain the cost and they years. The growth of TORM’s fleet and Jens Martin Jensen, Chief Executive, will be forced to sell,” Mr Petropoulos the need to be closer to its customers has Frontline said. necessitated a change of the pool The clue to growth will be in the operation. TORM will substitute pools anticipation that newbuilding prices will refineries, he warned. However, with strategic partnerships whenever fall because the volume of orders is everything up to 2015 has been relevant. dropping dramatically. anticipated such as knowledge of A company spokesman said: “We “People are trying to grasp for good refinery growth and knowledge of have agreed with the remaining pool news and the news is not particularly tonnage supplied between now and partner Reederei Nord to close the pool. good,” he told SMI. “You can’t get away 2015. “Those owners who have diverted TORM will then operate a fleet of about from the fact that we are in an over- their fleet between time charter, spot and 25 LR1 vessels. In total TORM operates tonnaged market with no significant period business will survive this period; about 120 tankers. unanticipated growth; all growth has but owners who are into asset play are Four vessels will be redelivered to been anticipated and it doesn’t look like going to have a tough time. Reederei Nord by October 2011. “It is a there will be any further growth in “The real question is will fleets necessary decision for TORM to do this, demand as everything has been change hands and the answer is yes; but and I would like to stress that we depart anticipated. it will be at a percentage of the dollar from the pool as friends with the hope “There is an oversupply of tonnage and not at face value. There will be fleet that we in the future, once again, can find in a market which has been anticipated acquisitions, definitely; there could be mutual grounds for closer cooperation,” for the past two or three years. The only charter acquisitions/bareboat but it will said Tina Revsbech, Senior Vice surprises are that people have continued be controlled,” he said. ■ President Tanker Division. ■ REGIONAL FOCUS JAPAN & KOREA

Strategic focus on higher added-value sectors By David Tinsley s a country with extremely limited half was the confirmation of an order from The shipbuilder’s offshore division has natural resources, South Korea has Royal Dutch Shell for the world’s first and also landed a $1.2bn contract from BP for an Amade its way in the world through largest newbuild LNG-FPSO (floating FPSO equipped to produce 130,000 barrels of unerring industrial endeavour and exporting production, storage and offloading) unit. The oil and 2.2m cubic metres of gas per day, with achievement. Prolific production capabilities project is worth around $3bn in total, and the storage for 1.06m barrels of oil. The unit will in key fields have been augmented by rapid ‘floater’ will tap at least 5.3m tonnes per be assigned to the Schiehallion Field, west of advances in product quality and annum of LNG, condensate and LPG from Shetland. technological self-reliance. the Prelude field off northwest Australia. Unerring attention to established, core Readily exemplified by the electronics Shell had earlier signed a master sectors of business saw the tranche of drillship and automotive sectors, the blend of agreement with a consortium comprising contracts immediately preceded by a deal production scale, technological standard, Samsung and French engineering contractor with Hapag-Lloyd covering the construction research commitment and commercial verve Technip for the design, construction and of four 13,100 teu ultra-large containerships, displayed by the major business groups is also installation of multiple, floating LNG and the upscaling of six earlier-ordered clearly manifested in shipbuilding. The (FLNG) vessels over a period of up to 15 newbuilds from 8,600 to 13,100 teu capacity. leading Korean shipyards have weathered years, intended to monetise stranded or Indicative of the drive for more global financial and economic turmoil and are smaller offshore gas fields. The nascent LNG- specialised or customised business in the most creating a better platform for the future by FPSO has main dimensions of 488 metres populous tonnage categories, HHI recently focusing on the more capital-intensive types length by around 74 m width. completed model tests for a 190,000dwt of construction and larger, series-generating Following on from the delivery in 2010 design of Arctic ore carrier. These were projects. The sheer capital intensity of of two LNG shuttle and regasification vessels conducted at the Institute of Ocean individual offshore projects has given new (SRVs) from Samsung, Hoegh LNG made a Technology in Canada. The proposed vessel dimension to shipyard production. further, major commitment to the fast would be the world’s largest icebreaking One of the cornerstones of Samsung growing market for floating regasification commercial ship, able to independently Heavy Industries’ strategy has been its drive solutions by entrusting Hyundai Heavy navigate waters covered by 1.7m-thick ice at for business in what it describes as the marine Industries(HHI) with two, innovative LNG speeds up to six knots, significantly faster resources development equipment market, floating storage and regasification than other ice-going traders in heavy ice effectively the offshore domain. In this area, units(FSRUs). Utilising the Norwegian conditions. the company has achieved a 50% growth in company’s in-house design, the two 170,000 HHI’s technical programme geared to orders over the past five years, and the cu m FSRUs provided a first newbuild opportunities in the polar regions has also continuing inflow of contracts for drillships references in a field hitherto served by embraced the development of a special and floating production units has had a signal converted vessels. Through options appended welding technology for the tanks of LNG bearing on overall business expansion. The to the agreement, an ultimate series of six carriers and LNG-FPSOs to be employed in value of shipbuilding orders logged during Hoegh FSRUs is foreseen from the Arctic waters. the first six months of 2011, at $14.2billion, Korean yard. Technological advance in the means of exceeded the $11.5bn target for the HHI’s opening business in 2011 afforded production is going hand-in-hand with the whole year. further testament to the direction taken by the rising technological level of the products of Maersk’s contract award to Samsung in nation’s leading shipbuilders, whereby the the leading Korean yards. As a consequence June for two drillships, together worth more Ulsan yard attracted over $2bn-worth of of in-house development work, HHI plans to than $1.1bn, took the yard’s tally to 10 such orders for deepwater drillships. Two of the digitise all welding processes by 2015. vessels booked within a six-month period. In vessels were contracted by Noble Drilling, Superseding analogue welding, the digital fact, Samsung has attained an unrivalled which took out options on third and fourth welding process is expected to improve position in the sector, by attracting 42 of newbuilds, while two ships were booked by productivity by 20%, reducing man-hours by the 75 drillships contracted worldwide Diamond Offshore Drilling, with an option on some 1m per year. The digital system also since 2000. a further vessel. HHI completed its first promises 10% savings in welding costs One of the fundamental influences on the drillship, Deepwater Champion, for US through reduced material requirements, while company’s business total for the 2011 first- company Transocean in November 2010. raising work quality.

48 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 JAPAN & KOREA REGIONAL FOCUS

Already the world’s largest producer of optimised to the requirements of the chances on the world market, but to create a marine diesel engines, Hyundai has both company’s African routes. It is distinguished more solid platform for Japanese economic expanded output and considerably reduced its by an environmental standard warranting recovery as a whole. In the meantime, and own reliance on foreign designs used as Registro Italiano Navale (RINA)’s Green against the backcloth of a strong yen, Chinese shipboard auxiliaries through the rapid Plus class notation. Each of the vessels has yards have made considerable ground in the development of its own HiMSEN range of four cargo decks, and can accommodate up bulker market at Japan’s expense, while four-stroke engines. Among the latest to 6,030 lane-metres of ro-ro freight or a Korea has proved dominant in the LNG initiatives has been the introduction of the maximum 2,920 teu containers. carrier stakes. vee-type H25/33V series, serving the power Daewoo is also a contributor to Korean Although analysts are dismissive of band from 4,080 to 6,800kW, and the pre-eminence in drillship construction, with Japanese shipbuilding as an enduring force in revision and 12% power uprating of the this year’s order inflow having included two the face of the Chinese advance based on ship smallest HiMSEN design, the H17/28 type. sophisticated vessels capable of drilling to a ‘commoditisation’ and Korea’s excelling A first in material usage has been depth of 12,000ft, booked by Norway’s Aker virtues in high added-value sectors, parts of signalled by STX Offshore & Shipbuilding’s Group. The shipyard is also hoping to build the industry in Japan continue to demonstrate plan to introduce Korean steelmaker Posco’s an LNG-FPSO conceived by Hoegh LNG a robust approach to business founded on ultra-wide thick plate for newbuild and offering a 3m tonnes per annum time-served principles of productivity, quality construction. STX has invested in the production capacity plus 220,000 cu m and delivery precision. requisite processing equipment, ahead of of storage. Seven years on from delivering luxury other shipbuilders, at its Dairen yard in Korean Register (KR), meanwhile, is vessels for Carnival’s Princess Cruises fleet, China. The high-value product is intended for steadily developing its position on the Mitsubishi Heavy Industries has shown its ultra-large ships, offshore plant and energy- international market. The society recently mettle by signing a memorandum of related projects. formally inaugurated its new Asia-Pacific understanding for two ships to be built for Daewoo reinforced Korea’s leading Headquarters in Singapore, which will another of the US group’s brands, AIDA position in container vessel construction, and oversee the 15 branch offices and survey Cruises. All previous and current AIDA underlined the country’s particularly strong stations located throughout the region. By newbuildings, designed primarily to serve the relationship with the industry’s ‘blue-chip’ coordinating the activities of the various German cruise market, have been contracted names, by landing two tranches of contracts outstations, KR will provide a more in Europe. this year from A.P.Moller-Maersk for record- comprehensive and coherent service delivery Although conclusion of the deal is breaking Triple-E ships. The design’s 18,000 to its customers. It has already opened subject to financing, the 125,000gt luxury teu intake is 16% greater than that of the regional headquarters in China and Europe, vessels are scheduled for delivery in March largest boxship to date, the 15,500 teu Emma and plans further enhancements next year. 2015 and March 2016 at a combined build Maersk type. With Maersk now committed Exchange rate factors have this year value in the region of Euro 910m. With cruise to a total of 20 such vessels, representing a intensified the difficulties faced by Japanese vessel construction constituting the last total value of $3.8bn, and with a further 10 shipbuilders in securing business on the remaining bastion of west European ships on option, Daewoo is set to realise international market in the face of commercial shipbuilding, the prospective serial production benefits on an competition from China and South Korea. loss of the AIDA project to Japan is indeed a unprecedented scale. The yen started 2011 at an already weak Y83 blow to the industry in Europe. Moreover, A preparedness and capability to supply to the dollar, and has continued its slide, successful execution of the order by MHI will bespoke tonnage, albeit in series, is illustrated such that the rate was down to Y77 by the no doubt put it in a stronger position to bid by the imminent completion of the first of end of August. for future work from major players in the four 45,200dwt ro-ro/container vessels With a diminishing orderbook across the cruise business. ordered by Ignazio Messina, the family- industry, some have called for more Unlike the Korean yards which are owned Italian shipping and logistics group. determined state intervention aimed at endeavouring to enter the field, MHI already The design offers a high degree of flexibility weakening the yen, to not only provide has a track record in cruiseship production, as to trade deployment, while being export-reliant shipbuilders with improved having built Crystal Cruises’ former Crystal

Samsung's Geoje Shipyard: the Korean builder has emerged as one of the world's leading lights in offshore vessel construction, complementing its prolific output of mercantile tonnage

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 49

JAPAN & KOREA REGIONAL FOCUS

Harmony and two vessels for Mitsui-OSK Lines as well as Princess Cruises’ 113,000gt sisters Diamond Princess and Sapphire Princess. Over the past year or so, considerable extra design and development resources have been allocated to the company’s drive to include a regular cruise vessel component to the output from the Nagasaki yard complex. In another area of outfitting-intensive shipbuilding, MHI also ranks among eastern Asia’s leading names in the construction of passenger/vehicle ferries. Much of this activity is concentrated at the Shimonoseki yard, where the current orderbook includes Hyundai Heavy Industries HiMSEN engines, seen here in genset production at Ulsan two coastal ferries for Shin Nihonkai and one for Kawasaki Kinkai Kisen’s Silver Ferry, all Under the reorganisation, and with effect and options have been placed on third for completion during 2012. from 2012, all commercial vessel and fourth vessels, which would have to As part of the 2010-implemented construction is to be undertaken at the be completed during 2015. All previous reorganisation of the group’s shipbuilding Nagasaki and Shimonoseki yards, while the Ramform ships have come from business, focused on achieving a shift to Kobe facility will become dedicated to Norwegian yards. higher value-added products and creating a submarine production. Indicative of the MHI strategy of leaner management structure, Shimonoseki In one of the most technologically- creating added-value in key, target market has undergone modernisation to widen its advanced, civil marine fields, MHI has this sectors, and also illustrative of the Japanese capabilities and raise productivity by 15%. year also scored against the European propensity for continual improvement The plan was completed in mid 2011, and has competition by winning an order for two of established technologies and included the creation of a new, berthside seismic survey ships. The deal with methodologies, the company has unveiled a assembly area and new heavy-duty craneage. Norwegian specialist Petroleum Geo- new design of LNG carrier. In addition to coastal ferries, Services (PGS) entails the next stage of The so-called EXTREM generation of ro-ro vessels and special-purpose ships, expansion of its fleet of unique Ramform- LNGC builds on the enduring popularity of Shimonoseki has been equipped for the type survey vessels. Two W-class newbuilds the Moss-type spherical cargo tank system, production of high-speed aluminium vessels. have been contracted for delivery in 2013, the primary global competitor to GTT REGIONAL FOCUS JAPAN & KOREA

membrane containment. Furthermore, and notwithstanding the considerable uptake of alternative powering solutions for LNG Allow armed guards onboard our ships, ask carriers, not least dual-fuel electric Japanese ship owners propulsion, the new design caters to those owners who still prefer a steam turbine Japanese ship owners have called on require legislation, and we hope necessary installation, by incorporating MHI’s new, the Tokyo government to allow armed measures will be taken as soon as possible." more efficient turbine plant. guards to be used onboard Japanese ships Masamichi Morooka, Senior Managing A recent initiative in Japan has seen the operating in pirate-infested waters. Corporate Officer and Representative release by ClassNK of an advisory document, The request comes at a time when Director at Nippon Yusen Kaisha (NYK) the Noise and Vibration Guideline, and the attacks from pirates are spreading from the also appeared as unsworn witnesses at the creation of new notations endorsing ‘Noise Gulf of Aden eastward to the waters off meeting together with Ashida, Kojima, Yoji Oman and even to the Indian Ocean. Fujisawa, President of the All Japan and Vibration Comfort’ (NVC) and Addressing a meeting of the House of Seamen's Union (JSU), and Isami Takeda, ‘Mechanical Vibration Awareness’ (MVA). Representatives' Special Committee on a professor at Dokkyo University. The notations will be offered from the Anti-Piracy Measures, Prevention of The JSA President told the session that autumn of 2011 onwards. International Terrorism, Akimitsu Ashida, Japanese shipping companies had ordered The society’s move has been prompted President of the Japanese Shipowners' their ships to take alternative routes and had both by the demand for improved shipboard Association (JSA), asked that Japan Coast installed counter-piracy measures such as working environments, given the link Guard officials and public-sector armed laser wire, bulletproof devices and between noise and crew fatigue and security guards such as those from Japanese shatterproof films that cover sheets of glass efficiency, and the growing awareness of the Self-Defence Forces and also private-sector to avert damage to crewmembers from potentially detrimental influences of armed security guards be allowed, for the pirate attacks. excessive vibration on ships’ machinery and first time, to embark Japanese-flagged The spread of attacks means those equipment. With technological advance and ships. He also repeated previous requests measures alone are not enough, he stressed, research in the field of noise and vibration for the dispatch of more destroyers and requesting that the government also take attenuation, ClassNK felt that it was apposite support ships. measures to allow public-sector or private- to issue a new set of standards for the Shigeru Kojima, Chairman of the Japan sector armed guards to embark industry. The society considers that its new Captains' Association, said: "Pirates who are Japanese-registered vessels. He also asked guideline will give owners, operators and getting more violent pose a threat to ships. that the escort zone be extended shipbuilders a useful tool for accurately We hope security guards armed with self- by around 1,000 km from the current measuring and rationally evaluating noise defence equipment will be permitted to zone and for the dispatch of more ■ and vibration levels. ■ embark Japanese-flagged ships. It may destroyers.

INSURANCE & LAW BUSINESS VIEWPOINT

Counteractingthe elementsBy James Brewer ix Britons in a small boat-cum- weather routing, suitable ports of refuge, sledge this summer braved ice floes and bunkering capability. Much of this type Sand polar bears to voyage 450 miles of practice is encapsulated by the to the magnetic North Pole, from committee’s Breach of Navigating Limit Resolution Bay in the Northwest Requirements Clause JH132 (recently Territories of Canada. Growing seasonal superseded by JH 2011/002) which ice melt had made possible this pioneering underwriters often use. feat, and while it was aimed at highlighting The Northern Sea Route sailing season the impact of climate change, it illustrated started earlier than ever this year, at the end at the same time a burning issue for of June, and Russia’s nuclear-powered operators of merchant ships and their icebreaker fleet was kept busy escorting dry insurers. As the ice retreats, traders are bulkers and tankers. The inter- pushing back the boundaries of waters that governmental Arctic Council has warned of are deemed navigable – but not necessarily inadequacies in charts, radio and satellite safe. communications, saying: “No research and Just when everyone thinks that none of the simulations have indicated that northerly avenues are becoming more No research and none of the winter sea ice cover of the Arctic Ocean benign, extreme conditions can ruin the the“ simulations have will disappear during this century.” There illusion, warns Mark Edmondson, is talk of cruise operators stationing ships

Chairman of London’s Joint Hull indicated that the winter sea in the Baltic year-round, yet conversely, Committee – which comprises severe ice conditions in the Gulf of Finland underwriting representatives from the ice cover of the“ Arctic this February prevented even Russian Lloyd’s and International Underwriting Ocean will disappear during icebreakers from helping vessels. Association company markets. Mr Edmondson is Vice-President of The pressure to sail new routes has this century Chubb Managing Agent which manages become a critical question for one of the syndicate 1882. He is marine hull class committee’s three sub-committees, which where there is increasing interest,” said Mr underwriter for the syndicate, which deals specifically with navigating limits. It Edmondson. “Only recently, at 162,000 dwt recently celebrated its first anniversary at comprises underwriters with considerable we have seen the largest vessel ever to Lloyd’s. “The role of the committee has knowledge about ice navigation in transit the Northern Sea passage, indicative changed significantly since I started my northeast Canada, the St Lawrence Seaway, of how this route is developing.” The career,” said Mr Edmondson, who is in his the Baltic Sea, the White Sea, and committee is drafting a market advisory second year as chairman of the committee. elsewhere. circular that will be published soon, with “It has moved from being a market Under a normal hull policy ice guidance to interested underwriters. “The policeman that almost literally controlled navigation is typically restricted by way of committee has been providing this type of pricing levels to a role that is much more a specific policy provision, subject to advice for as long as I can remember, but technical, drawing up advice and amendment by underwriters that the vessel only relatively recently has it been recommendations to the market on how can trade in a particular part of the world. formalised. It is a very good example of the they may wish to tackle aspects of risk. It is Sub-committee members are regularly technical function of the committee,” said nothing to do with pricing, deductibles and being asked how underwriters should Mr Edmondson. excess levels. There is no desire, or respond to proposed voyages to regions Underwriters will want to satisfy opportunity, for members to discuss where there may be limited salvage themselves before writing this kind of risk premium rating. We are well aware of the capability and scant reliable information. whether there are adequate arrangements competition rules of the European Union.” “We have had a number of enquiries with salvage companies, surveyors Non-members are invited to participate this year to the sub-committee both from available, vessels suitable for the intended in sub-committees, to draw in further within our market and from underwriters voyage, crew experienced in Arctic expertise, and to engage some of the residing in other international markets, for navigation, ice breaker and pilot services, younger underwriters more deeply with the example relating to the Northern Sea Route access to accurate weather information, issues. Priorities on the agenda at the risk

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 55 BUSINESS VIEWPOINT INSURANCE & LAW

assessment sub-committee include benefit to focus such an audit specifically challenge for an underwriter is to make sure liquefaction of certain high density cargoes, on bunker fuel, especially when there is a you mix your business correctly between an issue on which the committee is liaising need for fuel switching or slow steaming.“ the different risk categories. If you are with Intercargo and the International Group Mr Edmondson said of marine hull underwriting excessive amounts of of P&I Clubs, and a paper has been underwriting: “It is a very difficult line of mainstream tonnage you will find it submitted to the International Maritime business. The main dynamic is [insurance difficult to make a technical profit, with Organization. Co-operation with outside market] overcapacity, something we have competitive pricing levels having been bodies is an essential part of JHC activity, essentially had in our market since around pretty flat since the first quarter of 2010.” widening contacts with the industry. the mid-1990s. Certainly in recent years The reinsurance market is expected to Mr Edmondson emphasises the value that has put a natural lid on any really have to fund something like 80% of the of the JH143 shipyard risk assessment significant increase in rating levels. insured costs of the recent natural form, introduced by the committee in 2003 “Over the last 24 months there has been catastrophes – the tsunami in Japan, the in an effort to encourage ship owners, yards a net increase in capacity, including a earthquakes in Chile and New Zealand and and underwriters to identify, manage and number of start-ups at Lloyd’s. Their Hurricane Irene. It is widely acknowledged control construction risk factors of the kind subsequent effect very much depends on that reinsurance costs will inevitably that may result in costly fires and how that capacity is deployed. In my increase in general, with an immediate explosions. Mr Edmondson said that the opinion, the new capacity in Lloyd’s is negative effect on underwriters’ net results warranty had improved the risk climate. being deployed pretty sensibly.” – and in addition, the cost of capital has “You very rarely see a significant The shift eastwards in the maritime gone up. construction or conversion risk policy centre of gravity is meanwhile “not just With claims again at worrying levels – which does not have a JH143 risk about ship operations, it is about insurance “there have been a handful of major management provision,” he said. and finance.” London, Norway, Paris and casualties that clearly demonstrate that our Bunker fuel management is exercising the US, well established in the leadership of premium base as hull and machinery the committee too: a large percentage of the marine hull business, have been joined by underwriters is not robust enough” – there number of partial losses are related to markets in other territories, notably the Far is no question that this line of business is machinery or machinery space. Not least of East. “The effect is increasingly to volatile “not just as a result of very the worries is fuel switching and the use of commoditise hull and machinery business: competitive premiums, but in terms of the low sulphur fuels, and Mr Edmondson said: there is a lot of capacity available, with risks we insure. In a subscription market “On occasion, underwriters are able to adequate financial security, to insure such as ours, the art is to counter that apply technical policy provisions which mainstream blue-water tonnage. volatility by altering line size, selecting require a surveyor to look at the way the “That encourages a business that has risks correctly, and mixing your book in the machinery space is managed. It may be of become increasingly price-sensitive. So the most effective way.” ■

ECOVISION SALVAGE Prevention is

than cureBy Helen Jauregui ike that old adage about the iceberg, what is perceptible to the human Leye is not necessarily all that is present, and as salvage professionals can testify, the ocean is veiling some adverse surprises beneath its serene, salt water horizon. The number of sunken shipwrecks totals over 8,500 worldwide, 75% of which perished during World War II, and it is estimated that these forgotten vessels are harbouring as much as 20 million tonnes of oil and other environmentally hazardous substances. These statistics, which at best are acutely unsettling, indicate a cache of environmental time bombs, just waiting to make their final ticks before expelling potentially devastating oil leaks across our oceans and onto our beaches – but despite warnings from environmental groups and professionals involved in preventative measures and clean-up operations, political and public awareness of the problem remains underwhelming. The Exxon Valdez catastrophe of 1989, in which the oil tanker struck a reef in Alaska, spilling over 11m gallons of crude oil, generated enough public outcry to trigger the Oil Pollution Act of 1990 (OPA- 90) – a law designed to assist the prevention of, and response to, oil spill incidents. Arguably, it is the preventative element of this act which should garner the most support from public and political quarters, but unfortunately, society has a tendency to favour reactive rather than proactive responses to environmental threats, particularly as war time wrecks are practically invisible to the public and the cost of salvaging them all would prove substantial. One organisation that has taken wide steps to readdress this balance is the American Salvage Association (ASA) – a trade association dedicated to improving salvage response and bringing issues of common concern to its members to the forefront.

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According to Mauricio Garrido, As Mr Witte noted, oil spill incidents others have been promoted as diving President of the ASA, the public is not are often regarded as “non-events” until the attractions for adventurous tourists hoping aware of the issue of sunken wrecks, or of media publishes photographs of dead birds to experience a visual taste of romantic the importance of marine salvage (the and sea life – powerful imagery which, as abandonment, as associated with the Titanic process of rescuing a vessel or its cargo Mr Witte said, “really brings to life the or the Lost City of Atlantis. This includes from danger) as a preventative tool in the issues of environmental concern because the wreck of the Hoyo Maru, an oil tanker case of contemporary vessel sinkings, people can see it. You can’t see it if it’s which sank during the 1944 Operation where early intervention can mean the underwater and in a small or non-open area, Hailstone bombing raid by the US Navy difference between a salvageable situation so it’s a fight to gain support.” during the Battle for the Pacific. and a massive clean-up operation costing Since the war, this vessel, along with millions of dollars: “I don’t think the public around 60 others which also perished as a is aware at all of what the problem is, and Marine salvage is the best result of this military operation, have made what the alternatives are to address that “form of pollution control – as the seabed of the Chuuk Lagoon in the threat. With respect to the level of central Pacific region of Micronesia their knowledge of the American public, when long as you keep the grave, and though local diving businesses you talk about ships that are underwater and pollutant entrapped,“ then it have benefited from the mysterious full of oil – and that there are thousands of qualities of the wrecks, and various forms them which can leak, they perhaps start to won’t impact the of marine life have made these vessels think that you’ve been reading the works of environment their home, a significant oil slick is Jules Verne!” now emanating from the Hoyo Maru, He added that this lack of public John Witte, Immediate Past- accompanied by a smaller leak from the awareness is a significant challenge for President, American Salvage submarine support vessel Rio de Janeiro salvors but one which is motivating them to Maru. As the Earthwatch Institute (Europe) raise awareness of their profession as a vital Association has reported, this is now a dangerous threat method of preventing further damage, to the people of Chuuk and to the thousands whether in the immediate aftermath of a But public outcry can only take salvage of species which make this coral reef their modern day ship wreck or when salvaging efforts so far and as Mr Witte confirmed, home, including turtles, sharks, manta-rays, a vessel which sank generations ago. the “realities of the world in which we live” the rare coral type Acropora pichoni and John Witte Jr., Immediate Past- mean that although a pre-emptive attempt 266 different types of reef fish. President of the ASA, explained that to recover oil before it starts to leak out of The problem has become such a vital initially, OPA-90 focused on the clean-up a sunken wreck is significantly cheaper (10 issue that in August, Manny Mori, President of pollutants once they had escaped the times cheaper in fact) than it is to make an of the Federated States of Micronesia, casualty, as opposed to the salvage aspect, in-situ oil clean-up response, the problem decided to “go international” with the issue. which focuses on keeping the pollutant of funding still reigns high. “There is a President Mori wrote to the ambassadors of contained within the casualty and then great deal of positive momentum from Japan and the US in his region, to confirm removing the vessel intact. Based on the commercial industries who are certainly his decision to make an international recognition that safe salvage of the vessel very interested in looking at these intervention regarding the oil leak at the was the preferred option to cleaning it up problems, but how is it going to be paid for? Pacific Island Forum in Auckland, New after it spilled, the salvage portion of OPA- Money is a significant concern and these Zealand, and the United Nations General 90 was later strengthened, culminating in are not inexpensive environmental events. Assembly at the UN Headquarters in New the implementation of revisions to the But there has to be a commitment made at York. salvage portion in February 2011. “Salvors some point or we’re going to have some “I decided to raise this issue now in are just as important as a strong pollution very serious and significant environmental light of the imminent danger posed to the response capability. Marine salvage is the events which will trigger a much more people in Chuuk by a potential oil spill, as best form of pollution control – as long as expensive response.” documented in a 2008 Earthwatch Study, you keep the pollutant entrapped, then it Paul Hankins, ASA Secretary/Treasurer which predicted that more than 60 wrecks can’t impact the environment,” Mr added: “Salvage is the most important have 10-15 years before they will succumb Witte said. pollution prevention tool we have when to corrosion and spill their oily contents into The ASA has plans to educate young something goes wrong, but because there the lagoon and surrounding marine Americans at high school and university are no pictures of oil on the beach or oiled ecosystem,” the President said, highlighting level of the need for a preventative birds (as with response efforts), you don’t the fact that the Hoyo Maru is already approach to oil pollution. The Association get that kind of public outrage – its difficult leaking and that the combined estimated has also created a successful training to get anyone to focus on salvage because contents of the wrecks stands at over 30m committee, to provide the US Coast Guard its a prevention measure and prevention is gallons of oil. with a firm basic knowledge of what always harder to get funded than the actual It remains to be seen whether garnering salvage entails. The Coast Guard and ASA response to a calamity.” international political support will prove work closely to ensure both parties are Though actual oil spill incidents may difficult for President Mori, but according engaged in sound regulatory compliance capture both the political and public to Jim Shirley, ASA’s Legal Counsel, much and representatives meet face-to-face on a imagination more than potential oil slick like the general American public, most of routine basis to discuss and solve pertinent threats from sunken vessels, recent cases of the 535 individuals who man the Senate and issues. The ASA has also formed a leaking wartime wrecks have highlighted House of Representatives in Washington, partnership with the North American the need for a more targeted approach in also know little of “the danger of pollution Marine environment Protection Association using salvage to thwart pollution that lurks up and down the coastline”. (NAMEPA) – an organisation which is nightmares before they occur. However, Mr Shirley added that support active in its efforts to educate and create Though many of these wrecks have has been forthcoming from the public awareness. remained undisturbed for seven decades, Subcommittee on Coast Guard and

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SALVAGE ECOVISION

Maritime Transportation (including Congressman Elijah Cummings and the Committee’s Chairman, Congressman Frank LoBiondo), particularly concerning the issue of “responder immunity” – the right for salvage professionals attending an actual or potential pollution incident to be immune from blame and prosecution in connection to such incidents – so long as the pollution did not result from the salvage worker’s gross negligence or wilful misconduct. Cases of salvors being held responsible for pollution which they’ve come to help limit, rather than that which they’ve caused, are well documented and include that of Salvage Master Nick Pappas, who was detained in Pakistan during his work to The remnants of the bulk carrier Fedra which grounded off Gibraltar during a severe storm in 2008. Marine salvage the Greek flagged oil tanker salvage specialist Donjon Marine removed the remaining superstructure, the engine room shell and thousands of Tasman Spirit, which spilled over 12,000 gallons of fuel and contaminates that remained in the hull following the initial clean-up operation tonnes of oil into the Arabian Sea in 2003. As Jim Shirley explained, the ASA is respect to the property he’s there to save, is Paul Hankins added that although the working to ensure that in the US, a similar not held liable for his simple negligence, issues of war time wrecks and responder “blame culture” does not occur: “Nick only damages resulting from his gross immunity represent particularly challenging Pappas went to Pakistan as a Salvage negligence or wilful misconduct. In the case times for the ASA, progress is being made. Master to help remedy the situation but he of an oil spill, he might not only be liable He cited the example of the Montebello was detained by the Pakistani government for his simple negligence but he could be steam vessel which was struck with a just because of his position. The ship had held strictly liable under some statutes that torpedo in 1941, just off Point Piedras spilled oil but this was not his fault – he was have been used by prosecutors in the US Blancas, California. The vessel was there to remedy it. We’re afraid that such going after ship owners. It’s hard to get carrying 73,570.99 barrels of crude oil things might start to happen everywhere – attention on Capital Hill for something as when it sank and recently, the Captain of that the criminalisation of salvors will occur ‘unsexy’ as responder immunity for salvors the nearby Port of Los Angeles decided the more frequently. Right now, the salvage and to get legislation through, so it’s an Montebello posed a “significant risk”, community would be happy just to have ongoing battle.” particularly as it is adjacent to a national some confirmation, regulatory or otherwise John Witte added that although to his marine sanctuary. (such as through an amendment to OPA- knowledge, there has not yet been a case in An assessment is now taking place to 90), that they are entitled to at least the the US where a salvor has been found ascertain how much oil remains onboard same responder immunity that is provided criminally liable for a pollution incident, he and how much corrosion damage may have to oil spill clean up contractors by OPA- is concerned that in a big casualty situation, occurred and Mr Hankins said he is pleased 90.” where there is a significant chance for these efforts are “finally coming to fruition” “Even if we received such liability, even though a salvor may have following 18 months of deliberations. A confirmation, this would be from the taken every reasonable effort to rectify the common approach of “out of sight out of Federal Government and we would have to pollution problem, circumstances such as mind” may have slowed progress towards get our 23 coastal states to sign it. We bad weather or the deteriorating condition addressing salvage issues in the US, but would need our inland states with navigable of the vessel may take over, meaning that in with education and investment, the ASA is waters to agree as well, because OPA-90 an instant, a salvor could go from working hopeful that its pollution prevention does not pre-empt state law. It is a major to try and rectify a situation to facing a strategies will gain further backing concern that a salvor who ordinarily, in multi-million dollar liability law suit. in 2012. ■

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Vessel operations: Withtrimmings all the

experts, captains, naval architects and respectively. While the expected cost of the software designers to deliver its solutions North American ECA has been estimated to and as Philip Padfield, Chief Executive reach $3.2 billion by 2020, it is expected to Officer, explained, demand for Eniram’s deliver health cost savings (especially for services has increased as bunker costs those suffering from respiratory illnesses) appear to be “going through the roof”. of up to $110 billion in the US alone by the Mr Padfield said that as political unrest same year. in oil rich nations such as Libya continues Mr Padfield said operators of both to ‘exacerbate’ fuel prices, “operators are commercial and passenger vessels within saying they really need to do something this ECA are experiencing a period of more aggressive to cut fuel costs,” and this reflection as they decide how to satisfy their is driving demand for Eniram’s services. He requirements: “A lot of operators are asking also said Eniram’s customer base is being big questions – are they going to change shaped by the North American Emission their itineraries? Some can and some can’t. Control Area (ECA), which entered into Some of the cruise lines are talking about force on August 1st 2011 but will take effect moving their fleets or part of their fleets out he environmental costs of shipboard from August 1st 2012. The ECA stipulates of the North American Caribbean market emissions have gained prominence a 200 nautical mile zone in which ships and into the European market. I met with Tin line with soaring bunkering must reduce their emissions of nitrogen chief executives from a couple of the big prices, forcing operators to seek oxides (NOx), sulphur oxides (SOx), and brands recently and one of them said professional assistance to ensure their fine particulate matter (PM2.5). Europe will be the ‘new Caribbean’, as its vessels are functioning at optimal According to the US Environmental going to be cheaper to operate there.” performance. Finding a vessel’s optimal Protection Agency, by 2020, emissions Eniram’s Dynamic Trimming Assistant trim – the difference between the ship’s from vessels operating within the ECA are (DTA) is a system for dynamically (while forward and after drafts, and particularly predicted to be reduced annually by constant movement is occurring) the effect of this on vessel manoeuvrability 320,000 tonnes for NOx, 90,000 tons for monitoring and optimising vessel trim – a – can provide better speed and lessen fuel PM2.5, and 920,000 tons for SOx – part of the vessel where even the most consumption. representing 23%, 74%, and 86% minor adjustments can have a substantial While finding a vessel’s ideal trim is a relatively straightforward task in port, it can prove challenging when the vessel is at sea, due to factors such as swell, depth, wind, hull deflection and speed. It is only when these factors are taken into account, in real time and while the vessel is at sea that the optimum dynamic trim can be identified, but decision support system provider Eniram has created a solution to this conundrum. Headquartered in Helsinki but with offices in Singapore, Fort Lauderdale, Shanghai, Oslo and the UK, Eniram was founded in 2005 and provides solutions to decrease fuel consumption by delivering thorough and accurate analysis of vessel performance data and responding to this in real time. The company employs a range of specialists, including marine system

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“Of course there’s value in reducing your fuel consumption, everybody knows that, but the real value is when you have a deployment across an entire fleet. We mapped by our have a shore side application called technology.” FLEET which gives you an aggregative Mr Padfield explained how, following a view of all your vessels and how they’re few years of developing products around performing. So for example, we have an impact on ship performance. Launched in different trimmings and safety applications, analysis capable of monitoring the 2007, DTA is designed to collect prevailing DTA was launched in 2007 and sold to roughness of the hull and we can show trim, propulsion power and vessel Eniram’s first customer, Norwegian Cruise how much fouling has built up over time movement data and combines information Line, then Carnival Cruise Lines. Today the and can advise the operator of when they on current conditions, including speed and company has 88 installations onboard should dry dock the vessel for hull weather, to calculate the optimal trim. This vessels around the world. As Mr Padfield scrubbing or when they should do partial data is then presented in a user interface explained, Eniram has a number of other scrubbing with divers or polish the which guides the crew to make ballast vessels in the deployment phase and about propellers – so that is really where the adjustments to bring the vessel in line with 130 vessels will be completed by the end of value is.” optimal trim, leading to fuel savings of the year. Eniram’s solutions are currently But how would Mr Padfield like to between 2% and 5%, which according to installed on 50 cruise vessels and according see Eniram grow in the coming months? Mr Padfield, could represent a saving of to Mr Padfield, this represents around 25% As he told SMI, his strategy is to have 500 around $600,000 to $700,000 from an of the cruise market share, but the company installations in place by the end of 2013, operator’s bunker budget, with a saving of has also moved into the container, tanker which would provide a good critical mass: 3.18 tonnes of carbon emissions per tonne and bulker segments. “Once we have 500 installations we can of fuel. Eniram’s first container shipping start doing further interesting analysis of Eniram has also recruited a network of customer was German operator Hamburg our data. For example, we already know, service partners to perform installation Süd, which deployed its primary DTA and our operators know, that some of their work for the DTA, where sensors are system in summer 2009. In April 2011, vessels are better built for conditions in installed at the bow, and at perpendiculars. Hamburg Süd announced an order for 12 temperate climates rather than warmer “If it’s a large vessel, this usually means a additional installations and will deploy the climates. All vessels, even those built in new sensor every 100 metres,” Mr Padfield technology on all of its post-panamax the same yard, are slightly different. But if said. “We take these into our Vessel container vessels by the end of Q3 of this we can get a view of 500 vessels around Management System (VMS) platform year. Interest within the container segment the world and the unique characteristics of where all our data is collected, then we take has also come from Hapag-Lloyd while these and their environment, I think that feeds from the engine management system customers within the tanker and bulker would be incredibly valuable to us – I and from the bridge systems so we can markets include Maran Tankers don’t know how we’d leverage that but it show the operator a picture of everything Management and Vela International Marine would be valuable to our operators as that’s happening on the vessel – the effect Limited. well. So that’s where we’re heading and of stabilisers, the effect of wind, the effect Mr Padfield explained the value of we’re on track – we’ll have 130 or so of adverse weather conditions – all of that is combining DTA with other applications: completed by the end of this year.” ■

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 63 ECOVISION

Australia’s Lubes come unstuck under claim under emissions regulations

threat “While lubricant selection is straightforward for operation on single fuels, ustralia’s ability to preserve new challenges will arise if multiple fuels its massive Antarctic are used,” he said. “Engines burning heavy Asovereignty claim is under fuel oil (HFO) can use 20-50BN oils long-term threat, according to a depending on the fuels’ sulphur levels and policy paper released by leading the severity of the service, while engines think tank the Lowy Institute. operating on distillate fuels can use 12- It says international interest in 20BN, again depending on severity of Antarctica is rising, with major powers service. So vessels operating permanently such as China and Russia voicing their on distillate fuels, such as those operating interest in the continent's potential for solely in ECAs, can use a lower BN engine minerals and energy. lubricant, while those burning only HFO Resource exploitation in (with or without a scrubber) will require a Antarctica is currently prohibited under higher BN lubricant. an international treaty but countries can Mr Harrold added: “Given the higher withdraw from this after 2048. costs of distillate fuels, the pay-back period The paper, issued on August 8th, for exhaust gas scrubbers will provide a raises questions about Australia’s strong financial incentive for operators to fit ability to preserve its claim to 42% of scrubbing technology where the space the continent. Australia’s limited nternational Maritime Organization permits and will encourage acceleration of Antarctic activity is based almost sulphur emissions limits will have a the development of scrubbing technology. entirely on science and environmental Imajor impact on the cost of operations “A potential pinch-point could be the issues and does not reflect national in the cruise and ferry sector over the scrubbing industry's capacity to build and fit security or energy concerns, the coming years, as all potential means to scrubbers in the surge in last minute demand paper notes. meet the requirements will have an impact prior to the new sulphur fuel limits in 2015. on fuel costs; capital expenditure on Vessels that choose not to fit scrubbers, but abatement technologies, or fuel operate on HFO outside ECAs and on low infrastructure onboard; and ashore in the sulphur fuels inside ECAs, risk corrosion if case of liquefied natural gas (LNG). too low a BN lubricant is used, or potential Eco- The coming regulations also have build-up of ash deposits (from the metal consequences for lubricants, according to alkalis delivering the BN) if the lubricant Castrol Marine, where engine lubricant selected is too high BN. adventures selection is determined by the fuel in use. “This will be particularly true if LNG is Paul Harrold, Castrol Technology Manager the chosen low sulphur fuel and Castrol is recycle their Marine and Energy (pictured), said Castrol continually building its experience of good Marine’s engine oil experience and research operation on lubricating engines burning programmes are key to ensuring future LNG as well as engaging with OEMs on way around lubrication needs can be met. lubricant needs for the future.” the world

recycled truck made from trash Europe, the Middle East, Asia and the “It’s an experiment to see if we could and powered by restaurant Americas. recycle our way around the world. I’m Ascraps arrives back in the UK Pag built the truck in 2009 using an as surprised as anyone that we got after a two year around-the-world old school bus salvaged from a scrap around the world without putting any journey. Andy Pag and Christina yard, and using reclaimed materials to fossil fuel in the tank.” Ammon have driven their biotruck turn it into a cosy eco-home. He Four years ago Pag drove a fuelled by used cooking oil which they converted the engine to run on waste chocolate powered lorry to Timbuktu, scavenged from fryers along their cooking oil, installing a filtering system using biodiesel made from factory waste 30,000 km planet-circling tour across and large tank under the bed. He said: cocoa butter.

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A hull lot of protection

our choice of hull protection, blocks it was a complete shock to all those a new application is required with each particularly for vessels present. All of us there commented on the drydocking. On application, two coats of Ytraversing harsh conditions, can condition of the hull and in particular that Ecospeed are typically required but these bring delight or despair when it comes to there was negligible damage at the bows, can be applied to newbuildings at any drydocking and finding out whether the merely some scratch marks. None of us point in the building process, even if a hull coating is intact and ready for the would have predicted this. I then jokingly period of bad weather or winter occurs next voyage, or stripped down to bare, asked the question, ‘Are you sure you’ve between applications. unprotected steel and in need of an taken this ship to the ice?’” Ernest Shackleton was coated with expensive re-coating. This was in sharp contrast to the Ecospeed in 2009, and has since Luckily for the superintendent, vessel’s previous drydocking, where performed commercial survey work engineers and paint specialists who almost the entire hull coating was during the northern summer, followed by intercepted the Royal Research Ship discovered to have been stripped away, the loading of cargo and scientific (RRS) Ernest Shackleton during a revealing the naked steel beneath – its equipment in the Humber for return to the drydocking in Denmark in early 2011, the conventional ice-going underwater hull Antarctic. Mr Lee added that during the hull was found to be in top condition and coating was simply no match for the vessel’s drydocking in early 2011, the virtually undamaged, despite two seasons extreme conditions which are inevitable paint inspector, Howard Jess, took dry of battering through ice up to 2.5 meters for Antarctic voyages. film thickness measurements around the thick while facing high levels of abrasive The vessel’s recent drydocking hull, which he noted as 970-1000 microns gravel and even volcanic lava. success has been attributed to Ecospeed – on average, compared to the original Stephen Lee, Senior Marine Engineer an environmentally-safe underwater application of 1000 microns DFT on the for British Antarctic Survey (BAS) – a top coating system from Hydrex Underwater entire underwater hull, meaning barely environmental research centre, Technology, comprised of vinyl ester and any thickness had been lost, with chips responsible for the UK’s scientific with a high concentration of embedded and scrapes totalling less than 0.1% of the activities in Antarctica and operator of the glass platelets, which act as a durable, total surface area. Ernest Shackleton – described his impermeable barrier. Much like Sir Ernest Henry astonishment when the vessel was Following application, Ecospeed Shackleton – the famous British Antarctic brought in for dry docking at comes with a 10-year guarantee but is explorer and vessel’s namesake – the Frederikshaven, Denmark, earlier this expected to last the Ernest Shackleton will continue its year: “The biggest thing was the surprise lifetime of the vessel, missions with fervour, whatever at seeing the areas where you’d expect it in contrast to more extreme weather conditions it to have taken a lot of damage...when she traditional anti- may encounter, with its hull in first came out of the water and onto the fouling paints, where safe hands.

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 65 MARKET SECTOR HEAVY LIFT Lighteningload the

s the economic downturn Oaktree to obtain the ships which Hansa myself exuberant” he said, noting that continues to influence decisions Heavy Lift now operates, preventing any at present a “cautiously confident” Aover building projects worldwide, further reliance on the KG markets. The mood is the sensible approach. wise players within the heavy lift sector company currently has 17 vessels on its According to Mr Iliffe, Hansa Heavy are adapting to take advantage of growing books under four flags; Germany; Antigua Lift has adopted a ‘straightforward’ opportunities in the wind, mining and and Barbuda; Liberia and Gibraltar, but Mr business approach. All of its vessels are offshore sectors but as a situation of Iliffe said his company was also in talks heavy lift or super heavy lift and the firm is ‘overtonnage’ continues to force prices with Russian partners who are keen for the working to a modern, six-step management down, only the strongest will survive. company to have a Russian-flagged vessel. technique which allows customers to track Casualties have included German Hansa Heavy Lift is also currently awaiting their cargo at all stages. heavy lift carrier Beluga, which filed for five newbuildings (one F-class and four P2- With offices in Bremen (due to relocate insolvency in March this year, as class vessels). to Hamburg in 2012), Singapore and a owners and limited partnership So, an exciting start for this newly forthcoming branch in Houston, Hansa (Kommanditgesellschaftm, KG) houses formed company, but Mr Iliffe confirmed Heavy Lift has retained a high number of withdrew their interests from the company. he is ‘absolutely’ concerned about the issue ex-Beluga staff (around 50 out Oaktree Capital Management – a US of overtonnage within the heavy lift sector. of its 65 employees) and investment firm which controlled 49.5% of “I think anyone who’s not concerned about benefits from a Beluga shares and specialises in investment too much tonnage in heavy lift has their fully integrated in sectors experiencing downturn or head stuck in the sand,” he said. team where all distressed debt – swooped in to take the “Unfortunately, most of the tonnage was staff, including reins of the floundering company and in ordered in 2007 to 2008 but our figures engineering, fleet June, Beluga’s successor, Hansa Heavy Lift show that from the beginning of 2009 until management, chartering was launched. potentially the end of last year, no-one and sales personnel, Roger Iliffe, Senior Vice President at ordered anything with the exception of work in-house. Mr Iliffe Oaktree Capital Management, was COSCO (China Ocean Shipping (Group) said the decision to appointed Chief Executive Officer of the Company) which had some very large ships keep such services new entity and as he told SMI, Hansa Heavy in the 30,000 tonne plus range.” within the company Lift is learning from the mistakes of its He added that there seems to have been is vital owing to the predecessor: “Beluga had very little in the a slight return to the market this year, but ‘complexities’ of its way of management techniques and it very with orders for “ones and twos” as opposed vessels and cargo. quickly outgrew its own capabilities. We to large orders. “It’s about working off the Hansa Heavy Lift is have a much more focused fleet. Beluga backlog which was created three years ago currently making strides in the had handy-sized containerships, which in 2008,” Mr Iliffe said, adding that the wind, mining, and offshore wouldn’t be considered heavy lift ships at overtonnage situation has forced prices sectors and Mr Iliffe said his all in our definition of the market. Beluga down significantly. Though market company will benefit from Oaktree’s had a more eclectic, project-focused fleet.” conditions are poor at present, he said his previous experience within the oil and Oaktree Capital Management serves as company is confident that by the close of gas markets as the company owns Gulmar the only equity investor in Hansa Heavy 2012, prices will start to “come back”. In Offshore – a subsea contractor with a fleet of Lift and its vessels, but when the firm the meantime, Hansa Heavy Lift has five diving support vessels. He added the originally invested in Beluga, most of its resolved to survive by optimising its wind market is looking positive for heavy lift funds were soaked up in vessel debt, rather management processes. “It gives us some players but said caution is required as this than into Beluga itself. This allowed room for confidence but I wouldn’t call does not translate into too many freight tonne

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HEAVY LIFT MARKET SECTOR I think anyone who’s not concerned about“ too much tonnage in heavy“ lift has their head stuck in the sand

Roger Iliffe, Chief Executive Officer, Hansa Heavy Lift miles. “It would be good for us if the Since the Japanese tsunami and earthquake, the demand for“ Chinese producers start to pick up, as transporting wind turbines from China “import goods related to the power plant and energy sector, as to the North Sea is a pretty good well as the infrastructure sector, has increased substantially business but transporting them from Northern Germany to the North Sea is Holger Hinrichs, Managing Director, COLI Schiffahrt & Transport not really worth much to us,“ he said. Concerning the market for heavy lift Schiffahrt & Transport and CPC quarter of 2011 is that “the market is in the mining sector, Mr Iliffe noted that Consolidated Pool Carriers, agreed that stabilising on a realistic basis”. “Ship long term, there are positive trends, with although the Japanese earthquake was a owners and carriers with expensive tonnage a high level of capital expenditure and distinct human tragedy, it has brought some will face problems for a longer period, long-term perspectives. He said that port further business opportunities for the heavy certainly into 2012 and possibly beyond that construction and the expansion of the lift sector: “For years Japan was mainly period. Our company, with the position of a Panama Canal should bring further exporting its high technology and broker working with reliable carriers on a mechanical products. Since the tsunami and worldwide basis, is going to benefit from earthquake, demand for import goods this recent development,” he said. relating to the power plant and energy sector Commenting on the Japanese as well as the infrastructure/road sector has earthquake disaster, F.B. Bedford, a member increased substantially. Apart from that, of the board at Dutch heavy lift provider green energy business is getting more and Jumbo Shipping, said this will "put back the more popular in Japan these days. Wind redevelopment of the nuclear industry” but power shipments to Japan are regular he added this will only account for a business for the COLI Group.” relatively small sector of the heavy-lift Mr Hinrichs added that the heavy lift market, as the nuclear industry may, in part, sector has had to bear the brunt of cancelled be replaced by wind or possibly gas-fired and delayed building projects. He said that power. 2009 to 2010 was a relatively busy year for When asked how the recession will the project cargo sector, owing to projects continue to hit the heavy lift sector, Mr business to being contracted long term, but he noted that Bedford said: “The current financial the heavy lift in 2011 “there is clearly lack of project cargo instability which is rocking the world and sector and said heavy on a worldwide basis with only a few shows no clear signs of steadying is lift requirements for the exceptions”. obviously both a challenge and concern. atomic energy market are also “Demand has changed already – there is This works in two ways – projects will tend increasing, particularly in Russia, where less cargo. However, the carrier scene is to be delayed or curtailed while their owners officials “still see some pretty good export different as one of the ‘leaders’ has absorb the currency impact and the markets for atomic energy”. He added that disappeared and the fleet is now in the hands difficulties of pricing in what may be a “despite the dire situation in Japan” of owners and operators who are more world where inflation becomes a major following the earthquake and tsunami of careful in their forecasts and planning,” Mr challenge. At the ‘work-face’ level there are March 11th, the region is another growing Hinrichs said. currently too many ships chasing too few sector for heavy lift in the long term. He explained that from the COLI cargoes, and the perpetual challenge of Holger Hinrichs, Managing Director of Group’s perspective, a positive effect of this finding, training and retaining competent fellow German heavy lift providers COLI recent development in the first and second crews.”

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 67 MARKET SECTOR HEAVY LIFT

to be called “general cargo” sector and earning their keep there.” Noting how the overtonnage problem has forced freight rates down, he said that for operators who have “financially over- extended” themselves with loans, “the short term outlook must be very grim and we can expect some more bankruptcies or bank- forced sales”. For those looking to purchase newbuildings, Mr Bedford cited vessel conversions as a wiser option: “A well planned conversion, aimed to achieve a specific result and based upon a suitable, well-maintained and strongly-built ship is certainly a worthwhile option in a poor market.” But how can sensible operators benefit while their competitors are feeling the effects of their vessel spending sprees?

Images Courtesy of Jumbo Shipping and Hansa Heavy Lift Roger Iliffe concluded: “We definitely see in the next 12 to 18 months, there will be a However, he warned that the term of increase. The offshore industry, number of other distress situations arising ‘global downturn’ is a misnomer, including rig-moves is indeed experiencing among those companies who benefited particularly since Asian and Brazilian an upturn in demand particularly from 2012 from the KG market and ordered too many markets are ‘pretty buoyant’. Mr Bedford to 2013 onwards,” he added. ships. I don’t know who those will be – added that demand for project cargo ships When asked if he is worried by an they’re more likely to be Northern may have decreased because manufacturing overcapacity of tonnage within the heavy European than otherwise. To a certain has generally moved closer to project sites lift sector, Mr Bedford said he was “more extent, we see that as an opportunity and so, less ship-revenue miles are required. annoyed than concerned” over this issue: because we’re well-placed financially and “This is exacerbated by too many new ships “It will sort itself out in due course - I see if we’re able to pick up good ships at a being delivered but actual project cargo quite a lot of what I would term ‘mid- reasonable cost, we’ll do so over the next volumes are stable and even showing signs capacity’ tonnage retreating into what used 18 months.” ■

SHIP REPAIR

Conversion contract for Lloyd Werft

ermany’s Lloyd Werft the basic ship concept with Lloyd Werft, OIG Giant 11 will also get some very (Bremerhaven), one of northern that it has an excellent feel for new markets. special capability with the installation of an GEurope’s main exponents of the When the yard re-equipped the first two ultra-modern and complex Dynamic refurbishment and conversion industry, is special ships for service in 2008 and 2010, Positioning System (DPS). The system is to convert Harren & Partners’ heavy lift the Bremen firm brought US investment new to this ship and consistent with its vessel Combi Dock IV into a specialised bankers Goldmann Sachs Capital Partners specialist new tasks. GPS satellite control OSV (Offshore Support Vessel), the onboard. Under the leadership of Harren’s will ensure that during future operations redelivery being a very short period. It is Managing Director Heiko Felderhoff, the OIG Giant 11 will be within centimetres of only 19 months since the vessel, as a joint venture will be jointly responsible for its required position at sea. This requires the newbuilding, left Lloyd Werft. The heavy- the future strategic growth of the OIG and relocation and enlarging of the ship’s lift dock ship then arrived back at the will steadily expand the fleet. forward bow thruster and the addition of a shipyard during early August. As with the Blue Giant three years ago, further hydraulically retractable bow By the time of going to press, the 162.3 the future OIG Giant 11 (ex-Combi Dock thruster aileron. Two stern thrusters are also m long newbuilding will be converted for 1V) will also get a heli-pad on her bow. being installed. Offshore Installation Group (OIG) - newly Also, like Blue Giant, she will get an The real clout of OIG Giant 11, brought created by Harren - into the OIG Giant 11. additional, suspended seven-deck extension home only now by DPS, lies below her hull She will enter service as an offshore support to the forward superstructure containing in the form of two Azipod thrusters, which vessel from the end of September. “It’s not cabins, leisure facilities, larders and a water are also hydraulically retractable. The just the tight deadline that is a challenge for preparation and a biological purification Azipods can be turned from the bridge Lloyd Werft”, said Lloyd Werft’s Managing plants. This time, however, the facility will through 360º, pointing up the special Director Rüdiger Pallentin. He also not be a series of stacked containers but a manoeuverability of this 162.3 m long and expressed delight that the Bremen shipping single module. 25.4 m wide giant. Their propellers have a group had again placed its trust in The suspended module will have a diameter of 3 m and hang 3.3 m below the the shipyard and given it yet another generous 13 m x 18 m floor area and rise hull bottom. opportunity to prove its global reputation as 21 m out of the heavy lift cargo hold. Made Lloyd Werft will deliver, what is almost a leading builder/converter of specialised of steel, it will be manufactured in two a newbuilding, to Harren & Partners and the ships. “It’s a first-rate job and a sporting sections at WST Weser Stahlbau, located in OIG during the end of September. Her first challenge in such a short time-frame, but Bremerhaven opposite Lloyd Werft, before job will not have anything to do with oil or we are used to that here at Lloyd Werft,” he being hoisted onboard by the giant floating other seabed mineral resources, but with added. crane Enak and outfitted by the shipyard. renewable energy because OIG Giant 11 For the conversion of Combi Dock IV, The new accommodation block weighs 500 will transport three turbines for a tidal Pallentin and his team can also call upon tons and will house an additional 86 power station. ■ experience gained with another personnel. newbuilding - Combi Dock 11. That vessel The ship’s two forward, heavy-lift entered service in the Gulf of Mexico in cranes are being significantly lengthened to August 2008 as the oil-rig supply ship Blue enable them to reach as far and as high as Oman Drydock opens Giant and today operates as OIG Giant 1 possible. As with Blue Giant, the new OIG for OIG. Both heavy-lift dock ships are part Giant 11 will also have a moon-pool on the for business of a series of four built at Lloyd Werft starboard side of the loading bay. Divers fter the major foundation work of between 2007 and 2010. and equipment can be lowered into the the Middle East’s Oman Drydock Harren & Partners has been not water through this 7.80 m x 7.40 m opening ACo (ODC), Duqm, was completed only very successful with the Combi in the ship’s bottom. Lloyd Werft will also during April this year (2011), ODC began Dock ships within the German/Danish install six more generators to ensure that repair operations immediately with the shipmanagement joint venture Combi Lift, new capacities and workloads get the power repair of two split-hopper vessels both but has also shown, in the development of they need. owned Belgium’s Jan De Nul Dredging,

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proving a historic step and a defining ODC has successfully repaired 16 store 10,000 cu m. ODC’s large facility is moment, not only for ODC, but for the vessels since April, involving various types also ready to serve not only the ship repair whole Duqm region and Oman as a whole. of repairs and various sizes of ships. A total and conversion industries, but also any kind This progress has continued to allow ODC of seven vessels are currently under repair, of offshore structure such as platform to enter the Middle East repair business as and six more are booked. ODC is acquiring modules, jackets, wellheads, etc. The a major force. the necessary experience and maintenance majority of shipping related companies Following the first two repair projects, skills for more high-technical repairs worldwide consider that ODC is located in ODC carried out repair works on an Omani required for vessels, such as LNG tankers, a favourable position outside the Straits of landing craft named Halaniyat, which is and conversion projects. Hormuz and will inevitably play an owned by National Ferries Company, The Omani Government established important role in the Middle East shiprepair Oman which underwent various repair ODC in Duqm in 2006 to develop and and conversion industries. ■ operations including steel renewal, painting diversify heavy industries in Oman in and machinery repairs etc. The ship was in addition to the oil refinery industry. At the the yard for 12 days. same time, South Korea’s Daewoo The 22,525 dwt, 1,700 teu Shipbuilding and Marine Engineering MMHE continues its containership, Pacific Trader (ex-Delmas (DSME) signed a management contract for Nacala), owned by Germany’s Hermann the operation of ODC. Currently 50 people growth in the LNG Buss, was redelivered on August 22nd after of above manager level, including the CEO, tanker repair market 39 working days in the yard undergoing are from DSME all currently working in the 900 m of cell guide renewal and yard. alaysia Marine & Heavy hydroblasting and painting of 12 ballast ODC secured a 1.3 m sq m area in Engineering (MMHE) in Pasir tanks. The 8,830 dwt cement carrier Raysut Duqm and equipped the shipyard with MGudang, has repaired 12 large 1, managed by Greece’s Sekur Holdings Inc state-of-the-art facilities including two LNG tankers during this year. Only five was drydocked on July14th for steel ULCC class graving docks (410m x 95m have come from Malaysia International renewal in cargo tanks (approximately 150 and 410m x 80m), five quays totalling Shipping Corp (MISC) – the 152,300 cu m tons) and various machinery repairs. 2,800 m, 14 jib cranes with lifting capacity Seri Bijaksana, the 137,100 cu m Puteri The ship also being in the yard for some of 40 ton to 100 ton and a slop & sludge Nilam Satu, the 148,000 cu m Seri 39 days. treatment facility, including slop tanks to Amanah, the 130,405 cu m Puteri Zamrud, and the 130,000 cu m Tenaga Satu, which is being converted to a Floating Storage Unit – FSU Lekas. All these LNG tankers are of membrane design. MMHE has repaired three ships from Oman Shipping Management – the 138,000 cu m Sohar LNG, the 147,200 cu m Ibri LNG, which entered the yard on two separate occasions (all spherical), three from South Korea’s Hyundai Merchant Marine (HMM) – the 125,182 cu m Hyundai Utopia, the 135,000 cu Hyundai Technopia (see top left), and the 125,000 cu m Hyundai Greenpia (all spherical), and STX Panocean’s 126,400 cu m STX Kolt (Membrane). MMHE has a joint venture with South Korea’s Samsung Heavy Industries (SHI) to develop MMHE’s penetration in the Hermann Buss’ containership, Pacific Trader (ex-Delmas Nacala) in Oman Drydock LNG tanker repair market. ■

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NEWBUILDING NEWBUILDCONTRACTS Due to be handed over in October 2014, she The combined value of the nine vessels BOLD OWNERS, will become the largest ship in the Costa fleet, is close to $1.8bn. The six previously-booked offering a lower berth capacity of 3,700. On LNGCs are due in 2013 and early 2014, and DETERMINED YARDS the basis of the overall per-berth cost of some Samsung has undertaken to complete the MAKE THE RUNNING Euro 150,000, the newbuild order value is subsequent pair during 2014. The 170,000m3 around €555m. LNG-FSRU is due for handover in As a consequence of landing a contract September 2013. By David Tinsley from the BG Group of the UK to provide Following April’s letter of intent for two shuttle tanker capacity in Brazilian waters, LNG-FSRUs of 170,000m3 capacity, Hoegh oupling an evidently keen price with Teekay Offshore has returned to Samsung LNG has now signed a firm contract with a track record in passenger ship Heavy Industries for a new series of purpose- Hyundai Heavy Industries covering the Cconstruction, Mitsubishi Heavy designed vessels. The order comprises four construction of the two ships. In addition, the Industries recently signed a memorandum of dynamic-positioning, offshore loaders of agreement includes options on up to four understanding with Carnival Corporation 154,000dwt, and has been transacted at a total further vessels of the same type. The first two covering two 125,000gt cruise vessels cost of approximately $480m. The vessels vessels are commanding unit prices of destined for the US group’s German brand, will commence operation on 10-year $253m, with deliveries in the final quarter of AIDA Cruises. The project represents a timecharter to BG, under an agreement which 2013 and opening quarter of 2014. The switch of tonnage sourcing from Europe to includes provisions for contract extensions envisaged third and fourth ships would also Asia for the AIDA fleet, which is currently and also vessel purchase options. be required in 2014. being expanded through a seven-ship series Teekay is the world’s largest operator of This year’s surge in new contracts for at domestic shipbuilder Meyer Werft, shuttle tankers, having taken over Statoil’s containerships, pushing the global order including two outstanding deliveries in 2012 shipping entity Navion nine years ago. volume to a level corresponding to nearly and 2013. Samsung has provided the company with its 30% of the existing fleet, has led to warning The vessels from Japan would each most recent tonnage, based on a highly bells being sounded in certain quarters of the accommodate 3,250 passengers and rank as sophisticated design of 108,700dwt, led by industry. The fact that allusions to the largest ever constructed for AIDA, with the Amundsen Spirit and Nansen Spirit in ‘overbuilding’ and looming capacity excesses scheduled completions in March 2015 and 2010, followed this year by third and fourth are being made by leading names which have March 2016. sisters Peary Spirit and Scott Spirit. themselves made major, fresh commitments Although the ships are within the scope Chevron Shipping has also ordered a to new tonnage in 2011 will no doubt have of the German yard, MHI’s emergence as the 154,000dwt shuttle tanker from Samsung for been met with a certain scepticism in some strongest candidate for the deal underscores handover during 2013, while the Korean circles. the latter’s new strategic focus. Moreover, the yard’s latest dealings with Teekay have Daewoo Shipbuilding & Marine Japanese group is no stranger to Carnival, additionally encompassed an FPSO (floating Engineering is the beneficiary of one of the having delivered two ships for the Princess production, storage and offloading) unit latest containership projects, announced in Cruises’ brand in 2004. In the context of the specially designed for duty in harsh-weather August and encompassing five vessels of controlling contractual group, the prospective regimes. The FPSO will service a new 13,100 teu for Hyundai Merchant Marine. It AIDA business thereby represents the return contract entered into between Teekay and BG is understood that per-ship value is about of a past client. Carnival has put the all-in Norge, specifying deployment on the Knarr $135m-equivalent, and entails a delivery cost for these vessels at approximately oil and gas field in the North Sea, with charter schedule starting in the first quarter of 2014. €140,000 per lower berth, indicating a per- commencement in the first quarter of 2014. The project expresses a bid by HMM, and its ship price of about €455m. Fully built-up cost is stated as approximately New World Alliance partners APL and MOL, At the same time, Carnival has extended $1bn. to keep pace with investments in larger its 20-year contractual relationship with Following an initial award to Samsung vessels by rivals including Maersk Line and Italian shipbuilder Fincantieri by ordering a during the first half of the year of six LNG Mediterranean Shipping Company. 132,500gt vessel for the Costa Cruises brand. carriers of 160,000m3 capacity, Oslo-listed The scale of China’s shipbuilding Golar LNG has extended its newbuild capabilities and ambitions continues to find programme at the Korean yard through new expression, through the ups and downs contractual commitments to fifth and sixth of the various global shipping market sectors. gas carriers of the same type, and through a Among the latest developments, Rongsheng deal for an LNG-FSRU (floating storage and Heavy Industries has landed a contract for a regasification unit). series of 10 bulk carriers of 205,000dwt. The owning interests behind the deal for the so- called ultra-capesize or Newcastlemax class have not been identified. The enlargement of Rongsheng’s already considerable bulker orderbook comes despite considerable, rate- depressing overcapacity in the sector. Informed sources consider that China’s leaning towards conducting more of its own international trade using Chinese-controlled, Chinese-built vessels will generate further new orders in the coming months, even if market conditions appear unfavourable. ■

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Business School. Following a fruitful 20-year career at the Reuters news agency, including the role of Managing Director at Reuters Asia, Mr Penn joined the Baltic Exchange as Chief Executive in 2003, and as he told SMI, there are some key contrasts between the two roles: “The biggest difference is scale. Probably my biggest job when I was at Reuters was being in charge of their Asian business, where I had over 2,000 employees and £500 million turnover. At the Baltic we’re just approaching 30 employees so that’s the biggest change but of course, the upside of that is that you get to engage in detail on far more issues.” When asked what kind of leadership the modern-day Baltic Exchange requires, Mr Penn said his role is particularly wide-ranging, encompassing all aspects of business – from dealing with technology issues; to managing sales and marketing; to meeting with the British government to discuss changes to the taxation regime; or taking part in dispute resolution processes – Mr Penn said the diverse nature of his work is “what makes the job interesting but of course, “it has to be done by someone who is prepared to engage with every aspect of the Baltic’s business and who is willing and interested to be as wide- ranging as that.” Echoing his all-embracing approach to working life, Mr Penn has a varied set of hobbies which he embarks on in his spare time, including winter sports: “Skiing is my big thing. I seem to be pursuing evermore interesting physical challenges. In April this year I completed the Haute Route (a ski touring route from Chamonix, France, to Zermatt, Switzerland) and in a couple of weeks I’m climbing up Mount Blanc for the first time.” As part of his bucket list, Mr Penn said he’d like to visit a couple of his preferred ski resorts: “A lot of people who know me would say it isn’t possible for me to do more skiing! There are a couple of places I’d like to ski – La Grave in France and I’d like to go back to Jackson Hole Jeremy Penn (Wyoming, US).” Though his business life has provided the opportunity for travel, Chief Executive, Mr Penn added that prior to reaching his autumn years, he’d like to visit some key locations as a tourist. During his time at Reuters, Mr the Baltic Exchange Penn lived in Asia but he never visited Angkor Wat – a huge complex of temples in Angkor, Cambodia, dating back to the 12th century. Mr Penn said he would like to visit the complex one day but Laos and Born in the UK in 1959, Jeremy Penn attended Oxford Nepal are other destinations in South Asia which he is keen to see. University, gaining a Master of Arts degree in 1981, and went on to “I’ve also never really been to South America – I’d like to ski in Chile complete the Advanced Management Programme at Harvard and go to Argentina and Brazil” he added, explaining that his one-

74 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 THE BUCKET LIST SHIPMANAGEMENT

off visit to São Paulo on business for a quick, 24 hour trip, didn’t really provide many opportunities for tourism, hence he would like to return to Brazil and visit Rio de Janeiro. Back to discussing business, Mr Penn added that his roles at Reuters and the Baltic Exchange have both afforded him the opportunity to ‘monetise’ information, and the intellectual property associated with information, particularly on the financial side – skills which have served him well as the Baltic Exchange continues to evolve and change to suit the future. Describing how the Baltic Exchange “ has evolved in recent years, Mr Penn said its major role is now to act as a provider of A lot of people who know me would say it isn’t possible for “benchmark information” for the shipping “me to do more skiing! marketplace: “We’re still very much a marketplace organisation but rather than providing a trading floor, we now provide benchmark rates for dry bulk and tanker routes around the world. Those rates are used for settling many different contracts, including forward freight agreements which we are very much involved in promoting, and we work closely with brokers in the FAS market to promote that marketplace on a worldwide basis. Leading on from that has go ahead and do it anyway, which probably able to get a reservation at the Fat Duck been the creation of the BaltEx trading wasn’t very wise – it took me two years to (Heston Blumenthal’s restaurant in system which is a Financial Services recover.” Berkshire, England) a few years ago and Authority (FSA) regulated trading system Alongside his personal ambitions, Mr that was the most spectacular meal I’ve ever for freight derivatives.” Penn said on the business side of things, in had. You have the tasting menu where you So, has an electronic-based marketplace future he would “like to see a return to the go through about 12 courses and it really created a more challenging environment high rates, or at least something approaching was spectacular – excellent and fun – that’s within the Baltic Exchange? “I think it is the high rates that we saw in the years up the most important thing I once missed an more and more challenging as we’re now until 2008”. Though he acknowledged it’s opportunity to eat at the Auberge du Père running a regulated business for an unlikely that such ‘hot’ rates will occur, he Bise (a gourmet restaurant in Talloires, Lac electronic marketplace for FSAs, we’re said that “good, solid, profitable rates and a d'Annecy, France), so I’d quite like to go providing a lot more data to the market than reduction in overtonnage” would be positive there.” ■ we did and we’re providing forward curves changes for the future. on a daily basis for all the FSA contracts.” Describing some more of his personal Highlighting the Baltic Exchange’s goals, Mr Penn told SMI about his interest in efforts to publish data such as dry bulk route cabinet making, through which he has and tanker information during Asian created furniture for family and friends. “If business hours, in order to respond to the and when I ever have more time, I’ll needs of the Asian marketplace, Mr Penn probably go on some courses” he said. “I’d said: “We think it’s very important that the like to do some formal training – it doesn’t Baltic is seen to serve and does indeed serve matter if it involves a qualification or not but the worldwide shipping marketplace. It I’d like to do some formal training and would be fatal for us if we were perceived to spend more time on it because you need to be some sort of European only or London- be doing things all the time in order to centric organisation, so its vital that people develop your skills.” in Asia acknowledge that the Baltic serves Adding some extra items to his bucket them, in the same way we as serve people list, Mr Penn said: “I’ve attempted lots of in the European or American time zones.” the classic long books so there are plenty of Much akin to the Baltic Exchange’s those I’d like to finish, including Ulysses efforts to excel in all of its business areas, and Finnegans Wake by James Joyce and I’d Mr Penn harbours some sporting ambitions, like to have another attempt – I think it including his hopes to complete a marathon would be my third or fourth – at War and in under four hours: “I ran a marathon a few Peace (by Leo Tolstoy).” He added that he’d

years ago and I’d like to do that again, if not like to go to the theatre more as at present, I’ve never really been to next year then maybe the year after. I’d like he only manages to see a show once every to run it injury free and do it sub four hours.” couple of months. “South America – I’d like to“ Last time he took part in a marathon, Mr Drawing his list of ambitions to a close, ski in Chile and go to Penn soldiered on despite a calf injury: “I this adventurous Chief Executive described was doing it for a charity and so decided to his love of “good food and wine”: “I was Argentina and Brazil

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 75 SHIPMANAGEMENT THE BUCKET LIST Jens Olsen President, International Shipsuppliers & Services Association and Director/Part-owner, J.H.Olsen & Co, Copenhagen

Jens Olsen is on a mission and it’s not one he’s about to give up lightly. Despite having been in office as President of the International Shipsuppliers & Services Association (ISSA) for nearly three years, he still has a burning desire to drive the association forward and increase the recognition of the quality of service and goods supplied by its members. For all his working life, this affable Dane has been involved in making sure ships have the goods they need, when they need them and it is all thanks to his father, J.H. Olsen Snr who set up the family firm back in 1954, which Jens now oversees. THE BUCKET LIST SHIPMANAGEMENT

“Ship supply is in my blood,” laughed soldiers! At the moment we are supporting Admitting that his association Jens. “It’s been such a huge part of my life some military units in Afghanistan,” he responsibilities can take their toll on his and was that of my father.” explained. work time, Jens relishes his role as J.H.Olsen & Co was first established in So, how would he describe his years in President of ISSA because it enables him to Denmark as a general ship supply company the ship supply industry? There have keep a finger on the pulse of the industry. and specialist in supplying anchors and obviously been many changes. He is about to come to the end of his first chain cables. But it was not as part of the “Competition has been fierce and presidential term but was elected for a family business, that Jens first learned to falling product prices has meant ship supply further three years at this year’s annual ply his trade; he carried out an has become less profitable so finding a Convention which took place on the DFDS- apprenticeship at Lauritz Andersen, a niche in this business is vital for survival; owned ferry the Crown of Scandinavia supplier specialising in technical stores. something we have had to do over the sailing between Copenhagen and Oslo in After serving his apprenticeship he years.” May. spent two years carrying out his national Besides the military side of the He has drawn up a road map of action service in the Danish army. Even in the business, J.H. Olsen & Co started a sideline points he would like to see implemented army, Jens, who rose to the rank of in the beginning of the 1970s where it before the end of his second term. However, Sergeant, put his apprenticeship to good use became an agent for Coca-Cola looking if he could wave a magic wand before in the Supply Corps. His time in the armed after the important contract with the US leaving his presidential role, what would be forces was followed by two years of work Navy, delivering supplies to the on his ‘wish list’? experience overseas visiting ship suppliers Mediterranean and Atlantic Fleets from “Top of my list, and something which I and shipping companies in the UK, premises in Nice, France. monitor very closely, is prompt payment Germany and Holland to gain even more That side of the business has ended and from customers. Suppliers around the world valuable knowledge before heading back to the company now deals mainly with the big are hankering for a system which will the family business in 1968. Danish ship owners and supplies the ensure payment from ship owners. They are He put his army experience to good use majority of the cruise ships that sail into asking me why ISSA cannot help to make by starting to handle military supplies; and Copenhagen, supplying not only food, but sure we get paid. Of course, it is our wish supplied not only the Danish armed forces, also equipment and spare parts. too, and we are looking at different ways to but the British armed forces and later “The cruise ships are only really here help our members. NATO armed forces on exercise in in the summer months before they move to “Cash flow is our biggest problem and Denmark and northern Europe. the Caribbean and Mediterranean. For the we are very vulnerable when it comes to the “We still supply the military but rest of the year we deal with ships visiting customers. Because if they don’t pay us, we unfortunately we are running out of Copenhagen for fresh provisions.” still have our suppliers to pay and any delay SHIPMANAGEMENT THE BUCKET LIST

in payment is hurting our chances of survival.” He also hopes that all ship suppliers who are members of ISSA will become ISSA Quality Standard approved: “This will signify that the companies are serious and they want to provide a service that ship owners expect.” The ISSA Quality Standard was devised to set the minimum standard bench-mark for the ship supply industry that ISSA Members should strive to achieve and an updated Standard came into effect on 1st January this year to take into account a number of fresh initiatives. These included catering standards onboard ship and many environmental considerations such as avoiding the use of excessive packaging and better control of the disposal of toxic and carcinogenic material in port. Increasing the potential for new members in parts of the world where the association is not so easily recognised is also key and this is why Jens, at the time of speaking to SMI, was looking forward to the

first ISSA regional meeting in West Africa.

“There are still people around who are I’m not going to be jumping“ off any bridges! I have a not members of the association, and what we are doing now is to hold regional meetings “fantastic family, a lovely wife and we are both healthy, so what in places where we would not normally go more could I ask for? for the annual Convention. We go as the ISSA Executives with a selective group of THE BUCKET LIST SHIPMANAGEMENT

achievement that does not come down to one person but to the whole Executive Board that I am very proud to be a part of.” So, does Jens plan to let go of his company’s reins any time soon? “I have no plans to retire as yet and aim to carry on as long as I am happy every day I come in! I am very active in the company and try to be there as much as possible, because obviously the association takes up a lot of my time. “However, I will not be there forever and don’t want to literally fall off my chair, as my father did at 84!” When he does step down, Jens knows the company will be in safe hands as his son

Simon, and nephew Jørgen Arildslund are

already both involved in the day-to-day running of the business. “ So, when Jens is not working, or touring I love to spend time at our family farmhouse in Sweden, I’m the globe with his ISSA hat on, how does he “happiest when I’m swinging a hammer and sawing wood – I manage to unwind. “I love to spend time at our family am very much into DIY! farmhouse in Sweden,” he said. “I’m happiest when I’m swinging a hammer and specialists to tell ship suppliers in the region European Ship Supply Organisation, in sawing wood – I am very much into DIY! about ISSA and what ISSA can do for them 1997, a position he held for six years. “We also have a boat which is currently and why they should be part of it. Many of During the 16 years he has served on the moored in Malta and I have been sailing for those people do not travel to the annual ISSA Executive Board, Jens has been a number of years now.” Convention because of business and costs instrumental in helping protect the best His career has seen him well travelled, and so we take ISSA to them.” interests of the ship supply industry. He so is there anywhere he has a burning desire Jens says the ship supply sector is instigated the ISSA IT policy and, as part of to visit? Apparently not, however he has not ‘special’ in the way companies cooperate his IT responsibilities, accepted a Board travelled to West Africa before so, when SMI with each other: “The flexibility we have in position in the Maritime e-Commerce spoke to him, he was looking forward to the our industry is very unique. When people are Association. regional meeting in Accra, Ghana. together we are colleagues and not Speaking of his ISSA role, he said: “That will be very interesting and I love competitors and I think that is very special “Experience does not come from one person visiting new places and meeting new for our industry. I see this when I go to the alone. It has come from all the Executives people,” he said. various AGMs of the different national who have all contributed, and still contribute, Jens also used to be a keen sportsman associations. We are able to talk together and are extremely active within the and played a lot of badminton, but a problem about our problems and the opportunities association. Without the experience of other with his knee has put paid to any sporting ahead.” Executive Board members I would be ambitions. J.H. Olsen & Co has been a member of toothless.” Overall he does not feel there are any the Danish Shipsuppliers Association since “I absolutely enjoy my role as President personal goals he has not achieved and is the company was first established and Jens because I feel it makes a difference. In the quite content with his lot: “I’m not going to joined the Board in 1990; he was elected past five to 10 years we have manifested be jumping off any bridges! I have a fantastic Chairman in 1992, serving for 17 years and ourselves and we are now much more family, a lovely wife and we are both was also elected Chairman of OCEAN, the respected than we have ever been. That is an healthy, so what more could I ask for?” ■

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AdAdHoc Greenwich MaritimeHoc Institute plans Masters degree in security

iracy has become such a huge threat Strait it is the number one security problem The GMI said its graduates were being that the Greenwich Maritime in the Indian Ocean and a major problem in eagerly sought by employers and besides PInstitute of the University of the Gulf of Guinea,” said a GMI spokesman. serving in the navies, recent graduates are Greenwich is planning to start a new The Institute currently offers an MA in working as brokers, lawyers, consultants and Masters degree in Maritime Security Maritime History, an MA in International academics, senior management in shipping Management. Maritime Policy and an MBA in Maritime companies and oil and gas companies, as Preparation is already underway for the Management, with all available as a full- well as national representatives at the IMO. course which is scheduled to start in time one year, or part-time two year course. “Teaching at this level is critically September and is aimed at people wanting Although the courses are at entwined with ground-breaking original to be involved in this important and growing postgraduate level, GMI will accept students research,” said a GMI spokesman. “The area, which includes private security. The with relevant professional experience Institute is widening its expertise to embrace Institute is hoping it will be of particular instead of a first degree – service in the modern maritime security, energy, the interest to people who may be leaving the Merchant Navy, the maritime industry, environment and disaster management.” Royal Navy and Royal Marines. Royal Navy or Royal Marines all counts. Although part of the University of The Institute, based in the Old Royal The student body is expected to be a mix, Greenwich, GMI is partly funded by Naval College at Greenwich, currently has with older professionals studying alongside research grants from major Research four post-doctoral research fellows working younger people wanting to enter the Councils and other awarding bodies. Its on piracy, along with other key areas such as maritime industry. Students enrolled so far teaching is linked with a continuing apprenticeships and the governance of the include one hoping to become a ship broker programme of new research and funding River Thames. and a Master Mariner from Trinity House opportunities and recent applications include “The scourge of piracy has returned, and who will be going back to command a bids relating to the development of although it has diminished in the Malacca larger ship. renewable energy and cleaner fuels.

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Prolonged high yen Goltens is affecting Japanese offers a ship managers safe solution

apanese independent shipmanagement personnel overhead costs as long as they companies are addressing the surging maintain hubs in Japan. Jvalue of the yen by asking ship owners Furthermore, the source of human to accept a hike in shipmanagement fees resources for shipmanagement companies is and dollarised shipmanagement costs at dwindling as the number of Japanese marine their overseas hubs, reports Kaiji Press. engineers is on the decline. Such engineers In addition, some companies have with abundant experience and technical begun to request owners to pay skills working with shipping operators used shipmanagement fees in yen. Given the to be the main source of competent unusually high value of the yen at Y70 per manpower for shipmanagement companies. dollar, shipmanagement companies are Accordingly, shipmanagement companies seeing their balance sheet worsening rapidly need to hire marine engineers fresh from hough shipping needs a longer as they receive revenues in dollars and pay school and foster them. Training costs are long-term challenge in piracy costs in yen. increasing as a result. Tprevention, ship repair and While shipmanagement demand from Independent shipmanagement conditioning specialist Goltens is helping domestic owners is expected to grow companies, headquartered in Japan, are owners safeguard their assets and their steadily ahead as newbuildings drip feed trying hard to reduce office management seafarers, and even helping insurers sleep a into service, shipmanagement companies, costs and streamline operations. They are little better too. headquartered in Japan, find it hard to also dollarising costs by relocating some of As pirates raise the stakes on a number of increase the number of ships they manage their shipmanagement functions overseas. key ocean trades, simple, cost-effective on thinning revenues and higher costs due One shipmanagement official said: "Our preventive measures can be put in place to to the soaring value of the yen. In the business will get thinner in the days ahead protect ships and their crew in a matter of meantime, they are destined to face higher should we be unable to increase yen-based hours, according to Paul Friedberg, President yen-based office management costs and revenues." of Goltens Worldwide Services. "We offer a service out of our Fujairah facility which encompasses the installation of a combination of razor wire and hoistable spikes which effectively prevents the boarding of merchant vessels by pirates," Save our Seafarers he said. "We've already kitted out 24 Vela VLCCs, six Prisco VLCCs and six more VLCCs each belonging to Teekay and Chevron. campaign hits 20,000 "I realise there are complex issues relating to the deployment of armed guards on merchant vessels, and the commitment of naval vessels, but in the meantime there are mark immediate steps owners can take to protect their vessels and crews," Friedberg comments. "International shipping is fiddling he Save Our Seafarers campaign while Rome burns." has reached a milestone, attracting Costs vary, depending on ship size and T20,000 supporters in the six months type, but protection can usually be given for since its launch. $20,000 to $30,000 per ship. Through the group’s website they have More comprehensive protection all sent individually signed letters to heads measures are also available and have been of government in 73 countries across the ships to hold pirates and deliver them for requested by some owners. These include a globe, calling for a firmer stand against prosecution and punishment and to fully Citadel "safe room" where ship's crew can piracy. criminalise all acts of piracy and intent to retreat. Such spaces are fitted with satellite The campaign which raises awareness commit piracy under national law. communications and emergency rations. of both the human and economic cost of Since the launch in March, Other protective measures include the piracy, was formed by 25 of the world’s www.saveourseafarers.com has had over blanking off of all port-holes and other largest maritime organisations. The letter 65,000 visitors from 175 countries to the openings in the accommodation block. calls for governments to address six key site, and its Facebook page has 3,748 fans "Compare our protection with the cost of points including the authorisation of naval with 657 followers on Twitter. deploying armed guards," said Friedberg.

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India cracks down on IBF reaches three-year pay old ships settlement

he Indian government has imposed eafarers can look forward to higher restrictions on the entry of ships wages after an accord was reached Tolder than 25 years into its ports or Sby the International Bargaining territorial waters. Forum (IBF) during pay negotiations held It comes after a 27-year-old ship in Miami. carrying coal sank 20 nautical miles off The IBF, which consists of Mumbai en route to Dahej port in early representatives from the International August, spilling oil. The two ships that Transport Workers’ Federation (ITF) on collided in Mumbai port last year were also behalf of seafarers, and the Joint Negotiating “very old”, Shipping Minister G.K. Vasan Group (JNG) acting on behalf of employers, told Parliament. Ships older than 25 years agreed a three-year pay deal to be applied to old would be allowed entry into India’s all IBF agreements from January 1st, 2012. ports only if they met certain conditions, he This includes an incremental pay increase said. over this period whereby a 2% wage increase The proposed norms stipulate that will apply on January 1st, 2012, followed by ships should be approved by IACS member a 2.5% increase on January 1st, 2013. A final classification societies, have adequate 3% increase will apply on January 1st, 2014. insurance coverage for collision, wreck There are about 93 Indian ships over This increase will be applied to an removal and salvage and also appoint an 25 years of age, the minister said. element comprising both pay and union Indian agent to represent the ship owner or “However, they will not be affected as they funding but the specifics of funding elements, charterer. An Indian agent should provide are all classed with Indian Register of and how the increases will apply between the port authority and the customs collector Shipping which is a full member of the officers and ratings, will be confirmed at local with details of the ship at least 48 hours International Association of Classification negotiations to take place between employers prior to its arrival, the minister said. Societies.” and union affiliates.

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Australian shipping incidents down between 2005 and 2010

incidents remained fairly constant for the where two vessels were involved, and one duration of the period. The number of three-vessel occurrence between a barge in accidents fell from eight each year from tow with a tug and an offshore support 2005 to 2007 to three each year from 2008 vessel in 2010. to 2010, which reflected the decrease in The main vessels involved were bulk fatal accidents and people missing during carriers and cargo vessels, which also had the second half of the period, it said. the highest number of injuries recorded, and Injuries sustained were mainly to one close to one in four reported occurrences person in each occurrence; however, there resulting in serious or fatal injuries. Typical were occasional occurrences where more injuries sustained were falls from height, than one person was injured. being hit from falling or swinging objects, The West Australian and Queensland and burns from explosions, flame bursts or coasts had the most marine occurrences, hot fuel oil. followed by New South Wales and Victoria. The most common type of occurrence More than half of occurrences in the involved damage to the ship or equipment here were 546 marine occurrences Northern Territory occurred at sea, and followed by serious injury and equipment reported to the Australian Transport Tasmania and Victoria had about 75% and failure. Equipment failure, fires and TSafety Bureau (ATSB) from 2005 70% of occurrences while at berth or within explosions were associated with the highest to 2010. harbours. number of fatal and serious injuries. Cargo The ATSB’s latest report on marine The most common time period for vessels, bulk carriers and tankers were the incidents said there were significant marine occurrences was between 8am and most common vessels involved in pollution decreases in reported occurrences in 2008 11am. Most occurrences involved one occurrences, making up 22 out of the 25 and 2010, however, the number of serious vessel, however there were 43 occurrences vessels with this occurrence type.

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OBJECTS OF DESIRE LIVE Objects of desire

Tee time with Seve

Golf fans will be clamouring to claim a piece of sporting history with the Jaermann & Stübi’s Seve Ballesteros watch. Crafted from the golf clubs with which the late legend won the 1995 Spanish Open, each case is linked to a specific club, making it the ultimate commemoration piece. The watch, made in Switzerland, features scratch resistant sapphire glass, built-in shock absorber, is waterproof to 100 metres and made from stainless steel with a brushed and polished finish. Seve Ballesteros Watch £14,000 www.harrods.com

Beer on the move

You can get the party started wherever you want with this clever mobile beer bar. Perfect for private gatherings or company functions this cool contraption allows you to pour beer in style thanks to an integrated beer pump that delivers ice cold lager. The stainless steel device also boasts an onboard refrigeration system, storage for 8kg of ice, a glass washer and can also be fitted with an optional integrated gas grill, so you can barbecue while pouring drinks. Mobile Beer Bar £7,300 www.firebox.com

Kick off the flippers

Kick off your flippers and enjoy an easier way of scouring the sea with your scuba gear with the BladeFish Seajet. The lightweight rechargeable sea scooter will propel you for up to 40 minutes at just over 3kmph, just long enough to catch a good glimpse of what lies beneath. While you may not outswim any dolphins at least you will not have to over exert yourself looking at the wonders of the ocean. The handheld device works at depths of up to 20 metres and comes complete with a heavy-duty carry bag. BladeFish Seajet £279.99 www.play.com

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 85 LIVE OBJECTS OF DESIRE

Soda so good

Make your bar stand out from the crowd with this stunning sterling silver soda siphon from London-based jewellery designer to the rich and famous, Theo Fennell. The distinctive siphon, measuring 340mm in height, combines London- based Fennell’s trademark quirky and original design with traditional craftsmanship and skills. You will serve up the coolest spritzers in town! Silver Soda Siphon £9,000 www.theofunnell.com

Pocket projector

Projecting images onto walls and ceilings used to involve noisy contraptions prone to shifting out of focus. Not any more! The iGo DLP Pocket Projector is no bigger than a cigarette pack and simply hooks up to your video device whether it is a DVD player, laptop, smartphone or camera via the relevant cable. It will then beam your movie, stills and presentations into any flat surface across an area of up to 70 inches. Its size also means it is very easily transportable, so it is perfect for taking on overseas business trips. iGo Pocket Projector £239.99 www.amazon.co.uk

Small scale St Andrews

This model of the R & A Club House at St Andrews has been handcrafted by Timothy Richards and his small skilled team at the company of the same name in Bath, UK. Tim has been making sculptures of architecture in plaster for 19 years and this model has been designed for use as bookends but also works just as well as a stand alone collector’s piece. British gypsum plaster is the basic material while etched brass, white metal, copper, hand-made glass and gold are used to finish the model. Other models in the collection include The Pantheon in Rome and the Chrysler Building. R&A Club House, St Andrew Model £250 www.theinsideman.co.uk

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books, theatre, dining, events, culture, films, festival, music, review art, dvd, wine

Giants of the Sea (Giganten der Meere. Die Grössten Tankschiffe der Welt) books By Joachim Pein Koehler Books €25.60

Big ships mean big profits: that siren call building tankers at his yard in has worked for cruise ships and container Norfolk, Virginia, but with much ships, but in the tanker sector it has usually of Europe and Japan still in ashes, meant disaster. Entrepreneurs and oil he had the brainwave of signing a majors over the last 40 years have spent contract with the Japanese yard of billions of dollars on expensive and Kure, which had escaped wartime technically impressive hardware, only to damage. Under a 10-year contract consign it in short order to lay-up and in 1951, he went for a series of ultimately for shredding into razor blades, ships, starting with a 38,000 in the graphic phrase of one specialist tonner and leading in 1959 to the demolition shipbroker of the 1980s. first 100,000 tonner, the Universe The Hamburg maritime historian Joachim Apollo, for his Universe Pein has performed an immense service by Tankships business. brilliantly narrating the rise and fall of the Ludwig scorned the European genre. He has written not just a classic tanker “circus” and treated his book for the industry, but a social and ships as workhorses, while Onassis painted the second half of the 1970s, but the blow political history of our times. Nations still his showpieces shiny white (expensive and struck like lightning from a clear sky. On have much of their oil delivered in huge impractical for the carriage of a dirty October 6th, 1973, the Yom Kippur war consignments, and indeed there remain commodity) and put a piano in the broke out, and OPEC raised its posted 500 tankers of 200,000 dwt-plus in service owner’s cabin. price of Arabian light by 70%, which was worldwide (although 43 are single hulled Onassis over-played his hand by followed by an Arab boycott of the US and and have a limited life), but most of them challenging American oil companies’ The Netherlands. are thought to be running at a loss. This monopoly of transport from Saudi Arabia, Tanker rates slumped to Worldscale 80 book cries out for a translation into and soon after had to lay up his fleet in from a heady Worldscale 400. No-one English, but even a rudimentary Piraeus. He bounced back when the Suez wanted to know about long-term charters, knowledge of German and the pictorial crisis erupted, and suddenly all his ships and the first of many ships to be laid up, in aspect will keep the reader captivated. were in demand, at doubled freight rates. a Norwegian fjord, was Reksten’s 290,284 We meet many of the most ambitious and This was much to the chagrin of Niarchos dwt Sir Charles Hambro, after only one best known ship owners over the course of who had his fleet tied up in long-term year of service, to be followed by the 60 years. As the global economy recovered charters at much lower rates. record-earning Kong Haakon VII. Plans from World War II, Greek operators and Ten years later, an industrial boom spurred for 700,000 tonners and nuclear-driven others found that they could not supply the most profitable era in large tanker ships were shelved, forever. Companies tonnage fast enough to keep up with the history. Japan was producing 60% of very and yards collapsed. demand for crude. large crude carriers, and from all sources, Thanks to charters from 1980 by Iran in When the occupying powers lifted their from 1967 to 1971, 208 ships each the Gulf war, large tankers again hit the embargo on shipbuilding in post-war exceeding 200,000 dwt were put into headlines, but sadly 36 of them were hit by Germany, the “charismatic and crafty” service. Amid boundless euphoria, Japan Iraqi weaponry, with the deaths of many Aristoteles Socrates Homer Onassis asked was ready to build ships of 400,000 tonnes seafarers. Among casualties was the the German yards how many ships he by assembly line; in Germany, Kiel world’s largest ship, the 564,000 dwt would have to order to put them back in shipyard had plans for a drydock to build Seawise Giant, but she would be repaired business. Sixteen, came the answer, upon monsters of 650,000 dwt. A one million and survive another 21 years. which Onassis contracted 18. The tanker tonner was technically possible. AG Weser Pein carefully traces the tragic history of market became an arena for the fierce offered a so-called Europa-tanker of explosions and pollution incidents which rivalry between Onassis and Stavros 392,000 dwt and when it won an order led to considerable tightening of the Niarchos. When the former ordered a from Colocotronis, even Hapag-Lloyd regulations and to today’s admirable safety 30,000 tonner, the latter trumped it with a scrambled on to the bandwagon. record. But few economic lessons were 31,000 dwt ship; and then Onassis hit back Wild optimism seemed justified when spot learned, and another ordering spree in spectacular fashion in 1953 by taking fixtures rose to dream levels in late between 2004 and 2008 ended in tears delivery from Howaldtswerke of the summer 1973: a record $400,000 per day when rates slumped to $15,000 daily. 45,230 dwt Tina Onassis, named after his (in today’s equivalent) was paid for a After 2003, no-one wanted to take the risk wife, which shipping circles and the press voyage by the Norwegian Kong Haakon of sending a ship more than 25 years old to unanimously heralded as “the world’s first VII. For owner Hilmar Reksten of Bergen sea with half a million tonnes of oil. This supertanker.” this yielded a massive profit, given brought the seagoing career of the Seawise The driving force of this market had been running expenses of only $40,000. Giant, later the Jahre Viking, to an end. the American, DK Ludwig, a former Charterers and consumers were less The behemoth spent five years anchored seagoing engineer who foresaw the role enthused over such enormous transport off Qatar, before being driven on to a the Middle East would play. He had been costs. A sharp correction was forecast for beach at Alang for breaking.

88 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 books, theatre, dining, events, culture, films, festival, music, art, dvd, wine

Jerusalem: The Biography By Simon Sebag Montefiore Weidenfeld £25.00

This is a vast, but highly readable, “On purely geographical terms, no corner chronicle of a small city spanning 3,000 of the globe has seen such bloodshed, years of recorded history. Jerusalem – fanaticism, such glory and tragedy. “ capital of two peoples, shrine of three This biography is a history of imperial faiths – is an epic history of murder, expansions and endless conflict; the story violence, strife and persecution starring a of the Bible itself, of the ‘meeting place of long line of tyrants, kings and emperors – God and man.” Babylonians, Persians, Romans, It is said that a great number of first-time Christians, Ottomans, Arabs and Jews – all hell-bent on conquest and power. visitors to the city are so overwhelmed by “The history of Jerusalem is the history of the religious and historical intensity of the the world. Jerusalem was once regarded as place that they suffer delusions of the the centre of the world and today is more Jerusalem Syndrome kind, believing true than ever,” writes Sebag Montefiore. themselves to be genuine biblical figures.

Mercy By Jussi Adler-Olsen Penguin/Michael Joseph £6.99

Carl Morck is a bellicose Copenhagen detective suffering from post-traumatic stress disorder brought on by a shooting incident. He is off The Zero Point Conspiracy homicide, relegated to the By Donald Crighton basement of police HQ as Pegasus Elliot Mackenzie Publishers £8.99 ‘chief’ of Department Q, dedicated to cold cases. The case of Merete Lynggaard, a rising politician who vanished five years ago, presumed dead, troubles him; things in the investigation have been egregiously overlooked. Merete is held captive under the most inhumane conditions. How she survives her years’ long captivity forms the nerve- rending narrative of the crime plot. What shadows from her past cast this terrible tragedy in her unblemished life? It’s a suspenseful race to save Merete who has resigned herself to death’s embrace. You want Mercy to end; you don’t want it to end.

extracted from seawater, they replied, and Keller are put into place to stop him in Zero Point’s fiction is inspired by the his tracks. Admiral’s experiences. A British Naval Intelligence officer, Ken Author Donald Crighton has drawn on his American scientist Harry Keller is close to Douglas, arrives in New York with the maritime background to come up with this perfecting a water fuel cell that produces brief to keep Keller alive so he can new novel, based on the experiences of ex hydrogen from water using less energy complete his work, thus a dangerous cat Controller of the Navy, Admiral Sir than it creates, the scientists’ ‘Holy Grail’, and mouse game develops. Anthony Griffin. Zero Point Energy. His discovery is set to The author writes in the first person as The Admiral famously asked the transform the world providing unlimited Douglas and does so informatively admiralty boffins: ‘What will fuel the fleet clean energy from the world’s oceans but bringing enough twists and turns to carry when fossil fuel runs out?’ Hydrogen dark forces are at work and plots to kill the thriller along.

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 89 books, theatre, dining, events, culture, films, festival, music, art, dvd, wine

music Cleo Laine SuperHeavy Jazz (Remastered) SuperHeavy Blue Lable Universal Music You can’t keep a good lady down The two big ‘Stones’ of and the queen of the music world, scat, Cleo Laine, Rolling Stone Mick is proving that, Jagger and modern-day returning from soul singer Joss Stone, the heartache of are just two of the losing her talents in the new musical maestro supergroup, husband John Dankworth with the re- SuperHeavy. release of her Jazz album that first came The line up also out in 1989. includes reggae star The remastered reissue features Damian Marley, son of collaborations with guest musicians such the legendary Bob Marley, Eurthymics guitarist Dave as Gerry Mulligan and Clark Terry as well Stewart and award-winning Indian film composer, AR as saxophonist and clarinetist Dankworth Rahman, who gave us the catchy Jai Ho in the movie who died last year. Slumdog Millionaire. Along with the scatting, Laine’s beautiful And the musical medley works well, with all the voice has a very wide range and hooks musicians bringing something to the party. There are you into the tracks which include Oh, catchy rock songs with good riffs, world music with Indian influences and reggae Lady Be Good and It Don’t Mean A Thing beats, particularly in the popular Miracle Worker, the first single from the album. (If I Ain’t Got That Swing). The singing stars’ voices all mix compatibly and Jagger still delivers in his own Super shooby do! inimitable style, even performing in Sanskrit on Satyameva Jayate (Truth Alone Triumphs), the second track on the album. Backbeat theatre SuperHeavy does seem a strange melting point of talent but it does work and will www.atgtickets.com appeal to many musical tastes. From 10th October-24th March 2012

Red Hot Chili Peppers JZ Shan ghai Music Festival festival I’m With You www.jzfestival.com/en/ Warner Bros From 15th-23rd October

This is the first album for guitarist Josh Backbeat, the word is on the street that the Klinghoffer who musical telling the story of the birth of was brought in to The Beatles, is opening at London’s Duke replace John of York’s Theatre this month (October). Frusciante in Adapted from the 1994 film by Iain 2008, and Softley, the show embarks on the group’s according top journey from the famous docks of bandmate Flea, he has brought something Liverpool to search for success in the different to the mix. German city of Hamburg. Josh plays guitar, sings and plays the Renowned jazz pianist McCoy Tyner, It focuses on the compelling triangular drums and even wrote for the album, the winner of five Grammys, is just one of the relationship between the band’s original group’s 10th studio disc, which was many acts lining up for this year’s JZ bassist, Stuart Sutcliffe, his German produced by long-time collaborator Rick Shanghai Music Festival. photographer lover Astrid Kirchherr Rubin at the Cello Studios in LA where The event, which runs from 15th to 23rd and best friend and fellow bandmate the RHCP’s Californication was also October, is now in its seventh year and the John Lennon. recorded. third largest jazz festival in Asia. Other Sutcliffe’s death at the age of just 22, in It is the band’s first album since Stadium acts include American soul, funk and jazz the same year The Beatles appointed Brian Arcadium in 2006 and has received a mix composer and vibraphone player Roy Epstein as manager and they released their reception from fans with some liking the Ayers, Singaporean singer Olivia Ong and first single ‘Love Me Do’ adds poignancy more toned down sound and others French jazz trumpeter Erik Truffaz. to this vivid portrait of the 1960s. screaming it is too mild and that there is a The festival takes place at two locations in Backbeat, co-written by Softley and noticeable absence since the departure of Shanghai – there will be six outdoor Stephen Jeffreys and directed by David Frusciante. stages at the ‘Green Note’ Expo Park on Leveaux with musical direction from Paul The 14 tracks of great funk-rock still 15th and 16th and this is followed by the Stacey, features the all-time classics The remain catchy though, particularly the first ‘Masters Hall’ indoor concert series at the Beatles first produced including ‘Twist single ‘The Adventures of Rain Dance Shanghai Centre Theatre from 18th and Shout’, ‘Long Tall Sally’, ‘Please Mr Maggie’ and ‘Happiness Loves Company’. to 22nd. Postman’ and ‘Money’.

90 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 books, theatre, dining, events, culture, films, festival, music, art, dvd, wine

art wine Picasso: Masterpieces from the Musée National Picasso German wines get serious www.artgallery.nsw.gov.au Showing from 12th November to 25th Better known for cheap, sweet and semi-sweet low quality, March 2012 mass produced wines, Germany has had something of a tough time trying to convince serious wine drinkers that it is now capable of producing highly quaffable tipples. Liebfraumilch was a big hit in the 1970s and ‘80s with famous names such as Blue Nun being the wine of choice, but with tastes becoming more refined, so too have the wines. Now the country is seeing popularity growing for its lighter style wines in a bid to limit alcohol-related health problems, and also its red wines which have been increasing dramatically in number during the past 20 years. The lighter wines are often lower in alcohol than those from neighbouring France thanks to the cooler climate which means a long ripening season which creates refreshing, elegant tipples. They also offer the perfect balance between sweetness and acidity and are ideal as an aperitif or an accompaniment to food. While the climate has always been good for growing grapes for white wines, mainly the Riesling variety, it has made production of red wine very difficult, and in the past any red wines have been fairly light coloured. However, using different grapes and techniques such as barrelling vineyards have more recently been able to producer darker, richer, finer quality reds from grapes such as the Spätburgunder, the German name for the popular Pinot Noir. The result in these finer quality wines saw a healthy increase in German wine sales last year. Compared with 2009, quality wine exports posted an 8% increase in dining volume, and accounted for 80% of all Alinea German wine exports. The most www.alinea-restaurant.com important exports are the US, The Lincoln Park, Chicago Netherlands and Great Britain, followed by Norway and Sweden, while the Hong Kong Market was particularly dynamic despite its small size.

Top picks: Bassermann-Jordan 2009 Kalkofen Riesling Grand Cru dry Tasting Notes: This very dense and complex wine is crammed full of exotic fruit flavours with hints of apricot, pineapple Based in the Lincoln Park area of and passion fruit. The typical Riesling Chicago, Alinea is a restaurant full of acidity is still present but it is very ripe and theatre and surprise. delicate. Currently at number 6 in S. Pellegrino’s Region: Price: World’s Best 50 restaurants, Chef Grant Pfalz £33.99 bottle. Fans of renowned Spanish artist Pablo Achatz produces progressive American Picasso will have the first, and most cuisine that has propelled him to culinary Meyer-Näkel 2008 Spätburgunder S probably the only, chance to see a superstardom and the dishes on offer will QbA dry collection of his masterpieces in the delight even the most discerning of diners. Tasting notes: In nose and taste, an elegant Southern Hemisphere, in a special The deconstructed food offers unfamiliar combination of blackberry, morello cherry, exhibition at the Art Gallery of New South flavour combinations and is served in and redcurrant, raspberry, vanilla, dark Wales in Sydney, Australia. on all manner of implements such as test chocolate and hints of clove, underlined The collection is normally housed at the tubes, cylinders and multi-layered bowls with fine oak. Full bodied and long with an Musée National Picasso in Paris, but the that come apart. elegant tannin structure. museum has closed for renovation One such creation includes the Black Region: Ahr Price: £34.55 bottle allowing an unprecedented global tour. Truffle Explosion – a ravioli filled with The exhibition will feature more than 200 gelled truffle stock which, when melted Wines available from: paintings, sculptures, prints, drawings and through boiling, explodes in your mouth. www.thewinebarn.co.uk photographs spanning every phase of his The 12-course tasting menu costs $150 More information on German wines at career until his death in 1973. and the 23-course tour menu $225. www.winesofgermany.co.uk

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 91 LIFESTYLE INTERIOR DESIGN Enjoy the lifestyle with inWhat the smart bowels homes of are the wearing earth -

t’s official: home interiors is the new endowed voluptuaries and well-remunerated down wine to mature. There are a lot more porn. Like voyeurs seeking after lustful denizens of the Royal Borough of young people now with money who are Ithrills and titillations, we allow an Kensington & Chelsea, in prime-residential interested in wine. Consequently, people are increasing number of TV programmes to London, who have in the last few years put much more open-minded in how to enjoy let us into bodacious, great and grand in the largest number of applications for and share wine. Instead of being hidden designs for living. With trembling hands basement extensions. They can’t build away, they are now integrated as an and a tremor of anticipation running down upwards, so they are digging to depths of additional [home] entertainment feature. In one’s spine, we open voluptuously art- five storeys underground, to the apoplectic many cases, they are total destinations,” said worked magazine spreads, drool and gape harrumphing and consternation of put-upon Stephen Williams of Antique Wine Co. to with the kind of amazement and wonder neighbours, heritage groups and The Wall Street Journal. once reverentially reserved for the Dead conservationists who fear for the stability of These are not picayune wine racks from Sea Scrolls and the Rosetta Stone. water tables and the structural integrity of Ikea or fancy-schmanzy food halls. Swags of luxurious linen and drapery; the soil. Recherché homes boast well-lit, a Cezanne here, a Monet down the hall, a Entire facades are being upended, temperature/humidity-controlled wine Renoir there; stylish indoor topiary; Berber whole gardens being uprooted and tonnes of rooms, with wine-tasting areas, well carpets to sink into; acres of larcenously soil excavated to build multi-storey accoutred with the paraphernalia of wine- priced bathroom marble; tastefully placed basements in vast underground cavities – reverential libations – the comfortable sculptures and gewgaws brimming with called ‘iceberg homes’ – for Olympic-sized armchair, fibre-optic lighting, decanters, mute opulence; intelligently-curated swimming pools, Roman baths, his and hers lead cutters, wine-specific glasses, wine libraries and art galleries. Kitchens the size gyms, staff quarters, and pleasing tomes. A budget of £6,000 - £10,000 will of small islands. Ballrooms. Boys’ rooms enhancements like a sauna and spa complex, buy custom-built rack-lined walls, some with every conceivable equipment for multi-media home cinemas and games with traditional brick wine bins; glass- indoor sports and electronic games. rooms; the obligatory state-of-the-art Temperature-controlled closets, custom- security systems and panic rooms; built for fur coats, leathergoods, handmade garages and car lifts. And the new shoes and jaunty fedoras. Artificial new thing: bespoke wine cellars. intelligence systems and sensors that would Humidors and gun safes optional. make Scotland Yard blush; turn heating and “Fifty years ago, the main lighting on/off; put the music on; flip the market for wine was aristocracy DVD; take stock of larders and fridges; take living in manor homes, where bath-water temperature. No footling pile of parents and grandparents would lay piffle here. Every increased possession, wrote John Ruskin, loads us with a new weariness. Clearly he did not reckon on the well-

92 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 Enjoy the lifestyle with INTERIOR DESIGN LIFESTYLE

fronted vault-style modular cellars, with “Once people have tried them, they’ll per flush. Popular bestsellers come in thermohygrometers to monitor humidity wonder why they never tried them before,” Sedona beige or Sanagloss-cotton white. and temperature. Gaggenau’s sleek Vario said Jill Player-Bishop, Toto’s UK general Some advanced Washlets have massage 400 features two separate, adjustable manager. options and a number of water-jet climate zones for storing 101 bottles of reds With their glittering array of buttons, adjustments; they can mix water with soap and whites in ideal conditions. lights and dials, these futuristic-looking, for improved cleansing. A bubbly cleaning Serious oenophiles and epicures are not glistening-porcelain pods – some resolutely mechanism cleans the bowl after every use. constrained by the piffling matter of square, some gently contoured – have Some play music to relax the user’s sphincter budgets. A recently built £150,000 wine beneath their exteriors exquisitely muscles. A favourite, among the musically room in the salubrious environs of Chelsea engineered intimate hoses, water jets, inclined, is maker INAX’s toilet that plays shows off the owner’s wine collection of dryers, air fresheners and deodorisers for Felix Mendelssohn’s Fruhlingslied, Opus 62, more than 3,000 bottles, in leather-lined what converts and fans describe as the Number 6. Imagine a pleasing scherzo as shelves carved out of macassar ebony. The “ultimate toilet experience”. you perform your diurnal toilette! The lippy Michelin-starred chef Gordon Ramsay Japanese are the true and faithful Washlet Zoe, with seven functions, is listed had a £250,000 wine cellar recently built in disciples of Einstein’s dictum: “Everything in the Guinness World Records as “the his southwest London home. A Chinese should be made as simple as possible, but world’s most sophisticated toilet.” wine aficionado has a wine room in his not simpler.” Punctilious in the extreme, For the elderly, makers have added London home that displays only 67 bottles they have an obsessive regard for customised armrests and a device to help of prized Chateau Mouton Rothschild, with cleanliness, hygiene and sanitation, and take them to stand back up again. Ultra- each label designed by a different artist. their toilets seriously. “Toilets hold a special sophisticated Washlets feature a selection of What next? All-singing, all-dancing, place for the Japanese. They are pinnacles vibrating and pulsating water jets which, it all-cleansing toilets? Got to believe it! Smart of high technology, personal comfort and is claimed, benefit those who suffer from homes have a talent – exported by Japan, the even national pride,” wrote Kumiko constipation or haemorrhoids. home of the samurai and the ronin, the neat Makihara in “Toilet Worship”. Japanese Toto, founded in 1917, controls 60% to haiku, uwami and wabi-sabi – for serious households have more Washlets than they 70% of the Japanese market, and has made posterior pampering. The last word, ne plus have computers. November 10 is Japan’s serious inroads in Asia, the USA and ultra, in cutting-edge toilet technology and Toilet Day, with the numbers 11/10 (for Canada; it is now just coming into Britain designer lavatories is Japanese. month/day) indicating ii-to (ire), which and Europe. “Competition has spurred The Washlet – made by Toto, the means ‘good toilet’. In Japanese, the word Japanese manufacturers on to even greater world’s largest toilet manufacturer – is a ‘kirei’ means pretty, beautiful, as well as efforts, driving them to develop more highly automated toilet with an integrated clean and pure. Washlets are must-have, comfortable toilets, to turn the washroom bidet that, at a push of a button on a wireless highly functional design objects; they are into a place of relaxation,” said Tanaka control panel attached to the seat or by kirei. Nobuyuki of the product-strategy division of remote control mounted on a nearby wall, Germ-resisttant Washlets have Toto’s rival, INAX. performs several mind-blowing functions automatically warmed seats and nether- New developments in the pipeline – a that are miraculous to behold and region centred functions that include gift for valetudinarians – include the addition experience. They are some of the most washing; of warm jets of cleansing water of medical sensors that measure blood luxurious, modern and expensive toilets in (minimum of 38°C temperature) shooting pressure, blood sugar in urine, pulse rates the world today; and smart homes plumb gently from precisely aimed nozzles; blow- and body-fat content. Voice-operated well to have them. drying between 40°C and 60°C; seat lids lavatories are currently being refined to that automatically open respond to users’ verbal commands. and close (also known The style journalist and publisher, Tyler as ‘marriage savers’); Brule, divides the world into the Washlet- automatic flushing, and an haves and the Washlet have-nots. “It’s at the ozone-deodorant system. point where if you know someone who With a careful nod to water doesn’t have a Washlet, it seems odd. It’s like conservation, they boast the rest of the world is unwashed.” low-water If you have the readies, smart and usage, splendiferous homes of the 21st Century usually offer innumerable consolations, a plenitude 1.6 of pleasures and rubicund health. Truly if gallons they don’t snaffle your heart, they will most certainly your bottom. ■

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 93 LIFESTYLE MOTORING Enjoy the lifestyle with

Shaken, not By Helen Jauregui slurred?

ston Martin’s vehicles are as conspicuous as they Richard Hammond, presenter of the BBC car show are classic, largely owing to the brand’s timeless Top Gear, clearly stated his distaste for the “ridiculous” Adesign chic, which for generations has kept even concept of “a tarted-up Toyota” and said it represented the most studious of young men awake at night, “how to devalue your brand in one easy move”. Though pondering over the prospect of one day owning such a like Mr Hammond, fans of Aston Martin may be begging superb feat of engineering. The celebrated British luxury for the brand’s renowned power to leap from beneath the sports car manufacturer has been endorsed by everyone bonnet like a wolf in sheep’s clothing, the Cygnet lacks the from rock stars to royalty, with King Mohammed VI of strength and prowess which has made her older siblings Morocco, Steven Spielberg, the Prince of Wales, Rafa such fearsome opponents in the petrol head playground. Nadal, Slash and Courtney Love being just a brief The interior has been spruced up to give the Cygnet selection of those who bear the classic ‘wings’ logo upon slightly less of a Toyota-ish feel but the goods under the their key chains. bonnet will disappoint those hoping for power levels to But unsurprisingly, Aston Martin’s most famous rival Aston Martin’s more classic creations – forget the association is with slick lady-magnet and absolute super V12 you’ve dreamt of since infancy and say hello to a spy James Bond, who first buckled up inside his DB5 for 97bhp 1.33 VVTI petrol engine with MultriDrive Goldfinger in 1964 and has retained his fictional spy function, capable of 0-62mph in 11.6 seconds. association with the brand ever since. With a top speed of 106mph, the Cygnet won’t satisfy The Aston Martin V12 Vanquish has offered 007 those seeking a speed-limitless road trip on the autobahn, comfort and sophistication during even the hairiest of but in its defence, its presented as a nippy city car and has bullet-ridden car chase scenes. Likewise, with its sleek, never claimed to be anything but (though sometimes, it’s graphite blue-grey bodywork, the modern DBS V12 good to call a Toyota a Toyota). model ensured passers-by would turn the sourest shade of However, if you’re keen to reach a state of eco envious lime green when ‘Blonde Bond-shell’ Daniel nirvana, the Cygnet could slot comfortably into your green Craig swerved up to the Casino Royale in Montenegro, credentials. One motivating factor behind its conception for a game of poker so dangerous, he had to endure a stems from Aston Martin’s need to meet the European poisoning and subsequent cardiac arrest before recovering Union's fleet average emissions standards and the goal of to enjoy his final martini of the day. reducing new car emissions to 120g CO2/km by 2012. So, Bond may have grown accustomed to his garage in a move akin to creating a test tube baby for spare parts, stuffed with big boy’s toys but if a sabbatical from work the Cygnet is a creation born out of necessity which was to bring him back to suburbia, the need for something vaguely resembles those which have gone before it and speedy yet compact would inevitably hit home. will prove inherently useful – with emissions totaling a Thankfully, the plight of the hectic, modern city slicker mere 116g CO2/km, high sales of the Cygnet will ensure has started to permeate the minds of automotive designers a significant reduction in Aston Martin’s overall fleet and a trend for compact, city-friendly cars is shaping the emissions. future of intelligent, cosmopolitan vehicle production. But for the individual driver, the Cygnet is also The Aston Martin Cygnet is the brand’s first foray presented as a form of wonder car for those striving for a into city car design and represents the perfect alternative trauma-free morning commute. The search for a viable vehicle of choice, should 007 ever need to pop to the parking space is certainly a daily stress-fest the Cygnet shops for a pint of milk. At just three metres long, the has the power to relieve and one customer who has Cygnet is a paradox, offering compact styling with the publically lauded the car’s practical appeal is motorsport ability to squeeze inconceivably into the least generous legend Sir Stirling Moss, who purchased a model in July parking spaces and between the smallest gaps in traffic, as a surprise birthday gift for his wife, Lady Moss. but with spacious interiors to prevent any claustrophobic Perhaps the most famed couple in motorsport, Sir ‘sardine tin’ feelings while traversing commuter-ville. But Stirling and Lady Moss planned a private dinner in predictably, for those hoping to develop their own celebration of her birthday at the Royal Automobile Club, personal body groove into the driver’s seat of this in the century-old ‘Palace on Pall Mall’ clubhouse in charming 2+2, luxury does not come cheap. London. On arrival, Lady Moss was greeted by her new At £30,995, the cygnet is definitely at the pricier end Aston Martin Cygnet on display in the central rotunda, of the microcar market and critics have latched onto this marking the climax of six months of planning and ‘secret’ with blood-starved fangs, particularly as its design is correspondence between Sir Stirling and Aston Martin. derived from the popular and far less exclusive, Clearly delighted with his choice of gift, Sir Stirling Toyota iQ. explained why the vehicle was the perfect choice for the

94 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011 Enjoy the lifestyle with MOTORING LIFESTYLE

SEPTEMBER/OCTOBER 2011 ISSUE 33 SHIP MANAGEMENT INTERNATIONAL 95 LIFESTYLE MOTORING Enjoy the lifestyle with

unlikely to be able to afford such a vehicle and, perhaps, wouldn’t even want one. A common philosophy against competition and rivalry within the Parkour community has also led to criticism of the advert and rendered it somewhat ironic. So, has Aston Martin missed its mark by introducing a vehicle which lacks the velocity and sports chic of its predecessors, while attaching a price tag which could drive fans of other microcars, such as the iQ or Smart Car, straight out of the market? Not according to Aston Martin’s Chief Executive Officer, Dr Ulrich Bez. Describing love of his life: “My greatest partner in youthful commercial showed a pair of his brand’s latest creation as “a premium but everything that I do, Susie is an amazing ‘traceurs’ (Parkour practitioners), leaping compact package with heart, soul and person and frankly the best wife a man could through what they dub as an “Aston Martin personality,” Dr Bez was adamant that the have. Since seeing a pre-production Cygnet assault course” within the brand’s factory, Cygnet does not represent a steering away in January, I knew it was the perfect car for where the odd DBS and Vanquish lay from Aston Martin’s more traditional Susie; a proper little piece of British luxury dormant but illuminated within the dark offerings but rather, is the embodiment of it’s and perfect for our life in town.” The Cygnet warehouse, to whet the viewer’s appetite. The branding: “Our customers need a small car may suit the lifestyle of this octogenarian ex- duo then rush into a bleached white room to for urban and city use, and they want the right racer and his wife, but despite the need for a meet their target – the noble little Cygnet, tools for the right job, to downsize creatively thick wallet to fund its purchase, a blurry which they swiftly pounce upon before the without compromising intelligence, artistry marketing campaign has left critics unclear slogan “Cygnet – free runner” appears and and personality. as to who the car’s intended target customer the sinister, bass-heavy soundtrack fades out. “It is time to think differently. Aston actually is. It’s doubtful this was the advert which Martin is honest and we don’t make A recent collaboration with Parisian first aroused Sir Stirling’s interest in his compromises. Whatever we do, we do right. fashion house Colette introduced 14 wife’s birthday surprise. In fact, one could If we do performance, we do performance; exclusive ‘Cygnet & Colette’ editions of the voice disdain over this marketing ploy as a we don’t downsize or compromise our sports car to the market, allowing deep-pocketed cynical attempt to cash-in on a form of urban cars. The Cygnet needs to satisfy the customers to reach a whole new level of culture which is far removed from Aston demands of emissions and space. It is a car luxury branding through extra perks, Martin’s usual customer base – a sector of without compromise, just like every other including quilted sun visors, engraved door society comprised of individuals who are Aston Martin.” ■ handle badges and blue leather occasional cushions on the rear seats. Perhaps this extra push towards exclusivity leaves no doubt that the Cygnet’s customer base won’t sway too far from Aston Martin’s usual clientele, though this does contradict its initial marketing campaigns. The car’s first ‘teaser’ advertisement featured Parkour – a pursuit which involves running, vaulting, climbing, rolling and jumping across the urban landscape. The

96 SHIP MANAGEMENT INTERNATIONAL ISSUE 33 SEPTEMBER/OCTOBER 2011