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Thursday, 29 September 2011

Ship operating costs increase again but insurance costs plummet

International accountant and shipping consultant Moore Stephens says total annual operating costs in the shipping industry increased by an average 2.2 per cent in 2010. This compares with the 2.0 per cent average fall in costs recorded for the previous year, which was the first time since 2002 that operating costs had fallen. All cost categories showed an overall increase this time, with the exception of stores and insurance – with the latter falling by 4.7 per cent overall.

The findings are set out in OpCost 2011, Moore Stephens’ unique ship operating costs benchmarking tool, which reveals that all individual categories of vessel covered by the research, with the exception of handysize product tankers, experienced an increase in total operating costs in 2010, the financial year covered by the survey. Costs for the three main sectors covered – bulkers, tankers and container ships – were all up. The bulker index increased by 5 index points (or 2.9 per cent) on a year-on-year basis, while the tanker index witnessed a two-index-point (1.1 per cent) rise. Meanwhile, the container ship index (with a 2002 base year, as opposed to 2000 for the other two vessel classes) was up three index points, or 1.9 per cent. The corresponding figures in last year’s OpCost report showed falls in the bulker, tanker and container ship indexes of 1, 5 and 13 points respectively.

There was a 3.2 per cent overall increase in 2010 crew costs compared to the 2009 figure, which itself represented the most moderate increase for a number of years. In 2008, the report revealed a 21 per cent increase in this category. Tankers overall experienced increases in crew costs of 2.7 per cent on average, compared to 2.5 per cent in 2009. For bulkers, meanwhile, the overall increase in crew costs was 4.0 per cent, while for container ships it was 2.9 per cent.

For repairs and maintenance, there was an overall increase in costs of 4.5 per cent, compared to the 11.3 per cent decrease recorded for 2009. The biggest increase here was the 8.0 per cent recorded in the container ship category. For bulkers the increase was 7.6 per cent, and for tankers just 0.8 per cent. There were variations in the cost movements experienced within vessel categories. Whereas operators of handysize bulkers spent an average of 12.0 per cent more on repairs and maintenance in 2010, those running capsizes recorded an average increase of just 3.7 per cent. And whereas the average increase in repair and maintenance costs for panamax tankers was 8.4 per cent, operators of aframaxes actually spent 1.3 per cent less than in 2009. In the container vessel sector, meanwhile, increased repair and maintenance spend was fairly consistent across all box ship tonnage sizes covered by the report.

For the second successive year, OpCost reveals a fall in the level of spending on stores – down by 1.0 per cent. Overall, expenditure in this regard was actually up in the bulker sector, by 1.1 per cent, but down in the tanker trades (by 3.4 per cent) and in the container ship market (also by 3.4 per cent).

The insurance category showed the biggest movement in terms of costs – down overall by an average of 4.7 per cent across all vessel types in 2010. For tankers, the insurance spend was down by 7.9 per cent, for container ships by 3.8 per cent, and for bulkers by 2.9 per cent. Panamax bulkers were the only individual class of ship to spend more on insurance in 2010, while the likes of small chemical tankers (10.4 per cent), VLCCs (9.8 per cent) and aframax tankers (9.0 per cent) spent considerably less.

Moore Stephens partner Richard Greiner says: “The movement in operating costs during 2010 is fairly consistent with what we might have expected, bearing in mind the big fall in costs in 2009 and the continuing economic downturn. The average overall increase in crew costs of 3.2 per cent, up one per cent on the figure for 2009, is clearly a matter of continuing concern for owners and operators. But it is modest in comparison to some of the very significant increases recorded in this category in earlier years. The industry must continue to invest in personnel, and it is encouraging to see that it is not only doing so, but also doing so without suffering the huge surge in outgoings that was giving such a lopsided look to operating costs a couple of years ago.

“The 4.5 per cent average increase in expenditure on repairs and maintenance compares with a decrease of more than 11 per cent in 2009, but is significantly down on the 13 per cent-plus increases recorded in both 2007 and 2008. It is also an indicator not only of increases in the costs of labour and raw materials, but of a continuing willingness on the part of the industry to pay for the upkeep of its ships which, with increasingly stringent national and international regulations coming into force covering the likes of corporate and environmental responsibility, is a prerequisite for the continuing ability to trade.

“Spending on stores was down in 2010. This is perhaps something of a surprise, since the category includes lube oils, the price of which continued to rise throughout 2010, along with the cost of the additives which go into its manufacture. But the more widespread fitting of Alpha-type lubricating systems, the fall-off in some areas of trade, and the resort by some to slow steaming, appear to have made their effect felt in this regard.

“Insurance costs were the big mover in this year’s report, with spending down by almost 5 per cent. Conditions in the insurance market were more benign in 2010 than for a number of years. The general increases announced by the P&I clubs for 2011 are in most cases at their lowest levels for more than ten years, reflecting improved figures for 2010 and more optimistic forecasts for 2011 and 2012. The results of OpCost also point to a level of informed discernment in the commercial underwriting sector, with the likes of chemical tankers – notoriously ‘safe’ ships – paying over ten per cent less for their insurance in 2010 than in the previous year. Tighter regulation and stricter port state control should result in fewer accidents and, in an ideal world, will feed through to more favourable insurance rates.

“The global economic outlook remains both bleak and uncertain. Like other industries, shipping will both play a part in its recovery and suffer from its consequences. But the indications from OpCost 2011 are that operating costs are under a measure of control, which could prove crucial over the next couple of years.”

The latest report marks the eleventh year of publication for OpCost, which this time includes data from 2,600 ships, a record number. Running cost information is obtained on a confidential basis from clients of Moore Stephens, and from other shipowners and ship managers who submit data for inclusion. OpCost is widely used for benchmarking running costs, the preparation and ongoing monitoring of business plans and in forensic accounting. Copies of the OpCost 2011 report are available free to owners who submit their data for inclusion, or can be purchased by contacting Richard Greiner at Moore Stephens London.

Bone fide journalists can request an electronic copy of OpCost 2011 by emailing chris@merlinco.com

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping and insurance adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 638 offices of independent member firms in 97 countries, employing 20,588 people and generating revenues in 2010 of $2.151 billion.

For more information:
Richard Greiner
Moore Stephens LLP
Tel: +44 (0)20 7334 9191

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Wednesday, 28 September 2011

Liberian Registry grants honorary master’s licence to Mission to Seafarers director

THE Liberian Registry has awarded an honorary Master’s Licence to the Revd Canon Ken Peters, Director of Justice & Welfare for the Mission to Seafarers, in recognition of the generous and continued support he has provided in connection with Liberia’s Maritime Labour Convention (MLC 2006) Inspector Training Courses.

Presenting the award during the Mission to Seafarers Reception held at Lambeth Palace in London on September 27, Michalis Pantazopoulos, Senior Vice-President of the Liberian Registry, paid tribute to the contribution made by Revd Peters, who has been a long-time friend of the Liberian Registry. He noted that, most recently, the contribution made by Revd Peters has been instrumental in the global training of Liberia’s inspectors as the registry prepares them for the task of helping Liberian-flag shipowners implement MLC 2006.

Mr Pantazopoulos said, “Rev Peters has generously provided his inspirational lecture for a number of Liberian MLC Inspector Courses, discussing with more than eighty Liberian inspectors the core underlying principle of the MLC convention - protection of the interests and welfare of seafarers. His message has provided Liberia’s inspectors with value-added knowledge and essential skills which they can use when conducting MLC inspections.

“Revd Peters’ lectures have been so well-received by Liberia’s worldwide network of inspectors that the registry is honoured and grateful to have him as an essential part of its continued MLC Inspector Training Programme, as it plans to train an additional 200 inspectors during a series of upcoming MLC courses.”

Scott Bergeron, Chief Executive Officer of the Liberian International Ship & Corporate Registry (LISCR), which sponsored the event at Lambeth Palace, says, “We are very grateful to Revd Peters – I suppose we should now call him Captain Reverend Peters - for all his hard work and inspirational input to the registry efforts to promote and implement MLC 2006. The Mission to Seafarers provides help and support to those in need, working in more than 230 ports throughout the world, tending to the practical and spiritual welfare of seafarers of all nationalities and faiths. It is a privilege to work with Rev Peters, and to honour him in this way for the great contribution he has made – and continues to make – to seafarers’ welfare.”

The Liberian Registry is one of the world’s largest and most active shipping registers, with a long-established track record of combining the highest standards for vessels and crews with the highest standards of responsive service to owners. It has recently surpassed all-time tonnage records.


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Bad vibrations lead to costly dispute for shipmanager

International Transport Intermediaries Club (ITIC) has emphasised the importance of shipmanagers using the right contracts and having appropriate insurance in place to cover the legal costs of defending even weak claims.

In the latest edition of its Claims Review, ITIC relates the case of a shipmanager which took on the management of a vessel. One of its duties under the BIMCO Shipman 98 management agreement was to provide crew for and on behalf of the owners. In 2004, while the vessel was heading towards Shanghai, the master reported that it had experienced “excessive vibration” after passing close to a buoy marking a wreck.

After the master had left the ship at Shanghai and returned home, the shipmanager received an anonymous fax from the vessel, advising that it had actually hit a wreck. When the vessel reached its final destination it was drydocked, and damage was noted. Under the terms of the management agreement, the shipmanager was a co-assured under the hull policy, but the owner started arbitration proceedings against it, claiming that substantial additional costs had been incurred. The claim was based on an allegation that the shipmanager was vicariously liable for the actions of the master.

Wide-ranging allegations were also made to the effect that there had been significant tension, distrust and acrimony between the master and some of the vessel’s officers, which were a direct cause of the damage to the ship. The defence of the shipmanager was that, under the terms of the management agreement, it had no liability for the negligence of the crew. Rather, the manager’s sole obligation was to provide an appropriately qualified crew.

Negotiations and investigations by experts and lawyers continued for the next five years, and substantial costs were incurred. The arbitration hearing was scheduled to take place in early 2010 but, by late 2009, the owner (probably realising that its claim for crew negligence was unlikely to succeed) served an entirely revised claim, backed up by a lengthy report from an expert. The claim was fundamentally altered and was now focused on the shipmanager’s application of the ISM code and the role of the ‘designated person ashore’. A further allegation was made that the bridge team, or at least the principle members of it, were suffering from fatigue at the time of the incident and that the shipmanager should have been aware of this.

By this time, the costs of investigation and preparing the defence had reached $659,000. A defence was submitted on behalf of the manager that, on the evidence available, there was no error in navigation and so the claimant’s case could not be proven. Although ITIC’s lawyers were confident that the claim could be successfully defended, it was recognised that the hearing could last up to seven days, resulting in legal costs in the region of $560,000, in addition to $659,000 already spent preparing the defence.

In 2011, the owner made an offer to settle the claim on a ‘drop hands’ basis, with each side bearing its own costs. Although the shipmanager felt that it had been presented with an extremely weak case, it was not possible to completely rule out the possibility of adverse findings. Accordingly, the offer was accepted.

ITIC says, “This case shows how important it is to use the right contract and to have insurance and knowledgeable assistance to cover the legal costs and support and time needed to defend even weak claims. The defence of a shipmanager is always expensive and very time-consuming.”

Copies of the ITIC Claims Review can be requested from:

ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at

For more information:
Charlotte Kirk
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151

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AKD says hiring of armed guards should be left to government

In the wake of an independent report recommending the Netherlands government to provide Dutch shipowners with better levels of protection against piracy, including the hiring of armed guards, Netherlands law firm AKD says that shipowners who directly hire armed personnel themselves could face criminal prosecution.

The so-called De Wijckerslooth Committee report was designed to assess the desirability and possibility of deploying private sector armed security to help protect Dutch ships from the threat of attack by (mainly Somali) pirates. It recommends that the Dutch government moves towards a higher level of protection of its merchant fleet including, “if necessary”, the use of armed private security guards. The report, however, cautions that such security guards should only be hired by the government, and should only perform their security duties as soldiers under the full authority of the Ministry of Defence. The authors of the report add that, under the current circumstances, it is not desirable that shipowners privately hire armed private security guards, an option which should only be considered “in case of special conditions”.

The committee argues that, if the government uses its own resources, or engages reservists or hires armed private security guards who will temporarily be given military status, this will not constitute privatisation of security duties. By creating additional defence capacity in this way, no amendment of legislation and regulations will be required.

It is envisaged that the recommendations of the committee could lead, relatively quickly, to providing the level of protection against piracy considered necessary for merchant vessels. The alternative - whereby shipowners themselves hire private security guards (an approach endorsed by the Royal Association of Netherlands Shipowners) - entails “several problems”, according to the committee, and would require drastic amendment of Dutch legislation and regulations, which under normal circumstances could take “several years”.

Jan Kromhout, a partner with AKD in Rotterdam, says, “Clearly, it is the duty of government to do its utmost to protect the merchant fleet from attacks by pirates. In the event that the government is not able to fulfil its duties, for whatever reason, it will have to employ outside help. It is not desirable that privately owned companies hire armed protection to perform the duties which are the responsibility of government, which should retain its monopoly of force. Furthermore, the cost of providing protection against piracy should be borne by the state. Shipowners should only be allowed to hire private armed guards in special situations, in the event that the government is not able to fulfil its duties.

“In the event that Dutch shipowners do hire armed personnel, or provide weapons to those on board, those directly involved, as well as shore-based personnel (including the ultimate management of the company) could face criminal prosecution. Furthermore, shipowners could be faced with local legislation covering the import and export of weapons in the event that the vessel has weapons on board and enters the jurisdiction of another country.”

AKD’s transport law division provides a full range of legal services to the maritime and transport industry. AKD is a full-service firm with over 250 lawyers. AKD is in the top tier of Legal 500’s Netherlands shipping, aviation and transport section.


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Monday, 26 September 2011

Vestdavit appoints Australian naval service partner

Norway-based boat handling system and specialised davit supplier Vestdavit has appointed Australia’s Hydraulink NT as service partner for Australia, building on a successful long term contract to supply the Royal Australian Navy with highly capable davits for its fleet of Armidale-class offshore patrol vessels.

The appointment was confirmed at a meeting today at Vestdavit’s Bergen offices, attended by Stuart Kenny and Greg McKechnie, Hydraulink NT directors, and a delegation from Australia’s Northern Territory, led by Robert Knight, Minister for Defence Support.

Rolf Andreas Wigand, managing director, Vestdavit, says, “When we supplied the Royal Australian Navy with the quickest and safest way possible to launch and recover boats from their offshore patrol vessels we didn’t just supply well thought out engineering. We supplied a lifetime commitment to keep the equipment in the best operational condition. For that we need a high quality-engineering and hydraulic partner with expertise in servicing top-level machinery in rugged environments. I’m delighted we have found that in Hydraulink NT. We expect to build on this relationship as demand grows in the region for safe and effective means of handling boats at sea.”

Minister Robert Knight says, “Keeping our long coastline safe is a big task, and our navy deserves the best equipment and the best support. This agreement brings together the quality engineering and boat handling expertise of Vestdavit and the experienced team of fluid power systems technicians and engineers of Hydraulink NT.

“This builds on our government’s continued commitment to supporting Territorian business in the defence industry. This partnership between Hydraulink NT and Vestdavit will deliver safety and increase the Navy’s operational effectiveness by ensuring they can launch and recover boarding craft from the Armidale Class Patrol fleet as they patrol our northern shores.”

Stuart Kenny, Hydraulink NT director, says, “We know how demanding the RANS is on operational effectiveness, and we know how tough the environment is in which they work. Vestdavit has supplied a great system for their boats, and we are delighted to work with them to service the equipment and extend Vestdavit’s reach in this part of the world.”

Vestdavit has supplied 28 purpose-designed PLAR4500 davits for the Royal Australian Navy’s fleet of 14 Armidale Class offshore patrol vessels. Each davit can safely launch and recover an eight metre Zodiac fast boarding craft in seas up to 4 metres height. Additionally, Vestdavit has supplied 16 PLA 2000 davits to the Australian Customs for their patrol boats and 8 lightweight aluminium davits for the Royal New Zealand Navy.

Today Vestdavit has service partners in Brazil and South Africa and agents in the USA, Australia, Spain, UAE, Germany, Singapore and South Korea.

“Our davits are incredibly robust and work reliably for long intervals without service. But we recognise that what we sell is not a just boat system, but rather operational effectiveness. Offshore work and offshore security depends on getting boats away at sea, and the davits must work under all conditions. So our systems deserve and need support from local trained partners with skills and inventory to react rapidly to keep the system in the best condition. That is why we are expanding our global network and we will be training and appointing further services partners in different areas globally soon,” says Wigand.

Hydraulink NT has been designing, making and servicing hydraulic fluid management systems for many years. Its team of fluid power systems technicians and engineers are amongst the most experienced in Australia, with demonstrated successes across a broad range of applications in defence, mining, oil and gas and marine industries. Hydraulink NT’s expertise is in design, manufacture and installing quality fluid power systems that require a high degree of expertise, backed-up with extensive and diverse hands-on application experience.

Vestdavit designs and supplies tailor-made solutions for launching and recovering boats in difficult conditions at sea. Its diverse range of boats handling systems and davits are the first choice of navies, coastguards, seismic survey operators, pilot authorities and offshore operators globally. Since 1975 Bergen-based Vestdavit has supplied over 1,800 davits and side and stern launch systems. They have proven themselves over more than 30 years use in the North Sea and other harsh environments around the world. Self-tensioning and shock absorbing systems ensure crew safety and widen the operational window for the users. Vestdavit’s key focus is on operational effectiveness, safety and the reliability of its equipment. www.vestdavit.no

For really good photos of the Vestdavit systems and Armidale class OPVS at sea see attachments, go to http://bit.ly/roQ3Hu and use the download facility or e mail john@merlinco.com

For more information:
Rolf Andreas Wigand
+ 47 45 21 97 31


Confidence dips to all-time low as economic uncertainty fuels overtonnaging fears

Overall confidence levels in the shipping industry fell to their lowest level for three and a half years in the three months ended August 2011, according to the latest shipping confidence survey by leading accountant and shipping adviser Moore Stephens. Fears about overtonnaging, and continuing uncertainty about the global economy, were the main reasons for the decline in confidence. The rising cost of marine fuels was also a cause for concern.

In August 2011, the average confidence level expressed by respondents in the markets in which they operate was 5.3 on a scale of 1 (low) to 10 (high), compared to 5.6 in the previous survey in May 2011. This is the lowest figure recorded since the survey was launched in May 2008 with a confidence rating of 6.8, which remains the highest rating achieved thus far.

Confidence over the three-month period covered by the latest survey fell most noticeably on the part of owners, down from 5.8 to 5.1, the lowest owner rating recorded during the life of the survey to date. Confidence levels among charterers were even lower at 5.0, but the fall in comparison with the previous survey (from 5.4) was less than that for owners. Confidence on the part of managers fell from 5.8 to 5.6, while brokers held on to their already comparatively low rating of 5.1. Geographically, confidence remained lowest in Europe, falling from 5.5 to 5.0, its lowest level since the survey was launched. Asia, meanwhile, held steady at 5.7.

One respondent observed, “Until recently, things looked quite optimistic, but recent doubts over US loan credibility and EU financial worries have severely dented confidence.” Others referred to “the most unpredictable period since the beginning of the global financial crisis” and suggested that the market was “back to levels last seen in 2001.” Few could see a short-term solution to the difficulties.

Overtonnaging was a recurrent theme throughout the comments. “Markets are at rock-bottom,” said one respondent, “and will stay there for some time because of the large number of new vessels due to come into service. Older vessels and speculative investors, as well as low-grade operators, will have to disappear before the situation can start to improve.” Another respondent noted, “The situation looks pretty grim, given the massive amount of over-ordering.”

Expectations on the part of respondents of making a major investment or significant development over the next twelve months fell, on a scale of 1 to 10, from 5.6 to 5.1 – the lowest level since the same figure was recorded in November 2009. Just one year ago, in August 2010, respondents recorded the highest figure (6.0) in the life of the survey to date. This time, owners recorded the biggest drop in this regard, while managers and charterers were also less confident. Geographically, expectations of making a major investment were down across all the main regions covered by the survey.

Having dropped out of the top three for the first time in the last survey, finance costs returned as one of the top three factors which respondents expected to influence performance most significantly over the coming twelve months. Demand trends and competition, meanwhile, maintained their ever-present record in the top three.

Overall, 22 per cent of respondents (down from 23 per cent last time) cited demand trends as the most significant performance-affecting factor, while 17 per cent (19 per cent) identified competition in this regard. Meanwhile, 16 per cent of respondents, (14 per cent), opted for finance costs. The percentage of respondents overall who identified fuel costs as having a significant effect on performance was down by 4 percentage points to 12 per cent.

For owners, demand trends continued to be the dominating factor, despite a fall from 28 per cent to 24 per cent in the number of owners who put it in first place overall, ahead of finance costs and tonnage supply. The top three performance-influencing factors for managers were competition and demand trends - both cited by 17 per cent of respondents in that category and both up by two percentage points on last time – followed by operating costs. For charterers, meanwhile, demand trends and competition made up the top three, ahead of fuel costs.

Geographically, demand trends emerged as the most significant factor for operators in Asia, Europe and North America (19 per cent, 23 per cent and 30 per cent, respectively), with competition and finance costs making up the remainder of the top three.

Fewer respondents expected an increase in finance costs over the coming year - 52 per cent compared to 59 per cent in the previous survey. This was the case across all categories of respondent and in all geographical areas covered by the survey. Meanwhile, the number of charterers who were anticipating finance costs to fall over the next year was up from 9 per cent to 15 per cent, the highest figure since May 2009. Geographically, the biggest change was to be found in Asia, where the 50 per cent of respondents anticipating higher finance cost was twelve percentage points down on the 62 per cent recorded in May 2011.

There was a big fall in the numbers of respondents expecting rates in the tanker sector to increase over the next twelve months - down overall from 44 per cent last time to the lowest level since February 2009, at 34 per cent. Just 30 per cent of owners, the lowest total for more than two years, thought that rates were likely to increase, compared to 50 per cent in May 2011. Similarly, the numbers of managers and charterers who were anticipating tanker rate increases were the lowest since February 2009. Meanwhile, the overall number of respondents who thought that tanker rates were likely to fall over the coming year was up by 7 percentage points to 19 per cent. In the case of owners, 23 per cent thought that rates were likely to come down, compared to just 8 per cent last time. For charterers, the figure rose from 20 per cent to 26 per cent.

In the dry bulk sector, the number of respondents expecting rate increases over the next twelve months was down from 37 per cent to 27 per cent, an all-time low in the life of the survey. The number of owners who shared this opinion also hit an all-time low, while the 8 per cent of charterers of like mind was easily the lowest in three-and-a-half years.

The container ship market saw the biggest shift in opinion. In May 2011, there was a 28 percentage-point difference between the numbers anticipating higher rates and those who thought that rates would go down. Now, the gap has closed completely. Just 28 per cent of respondents overall thought that rate increases were likely over the coming year – the lowest figure since November 2009 – and 28 per cent expected rates to come down. Charterers were the only category of respondent recording an increase in expectations of higher rates. Owners and managers recorded the lowest figures in this regard since August 2009. In Asia, expectations of container ship rate increases were down from 41 per cent to 26 per cent, while in Europe the fall was from 44 per cent to 27 per cent.

Moore Stephens shipping partner, Richard Greiner, says, “The drop in shipping confidence to a record low is a disappointment. But it has been coming. Given what has been happening in the world, and in the industry, confidence remained surprisingly high last year, but it has started to slip in 2011. Indeed, in many ways, it is back to the levels of two years ago.

“We are starting to see now what many had predicted would happen much earlier. Banks are calling in their loans, shipping companies are filing for bankruptcy protection, ships are being arrested and auctioned around the world, and the courts and arbitration tribunals are starting to see an increase in their workloads. Financiers wants their money, and are ready to take what they can get now rather than wait in the hope that the markets will recover and enable them to achieve a return on their investment. This results in a situation in which everybody loses something. Financiers need to continue to work together with shipping companies and external financial advisers to find a way forward for viable long-term businesses, perhaps exploring the opportunities offered by independent business reviews.

“Meanwhile, costs are going up all the time. Bunker prices are the big worry. The cost of fuel has to be met and passed down the chain, at a time when money is tight for everybody. After a lull, the indications are that operating costs are once again likely to increase. The cost of raw materials also continues to rise. At the same time, freight rates are tumbling through the floor, stock markets are falling around the world, the US and European economies continue to stutter unsatisfactorily, political unrest in the Middle East shows no sign of abating, and the general economic gloom deepens.

“Our survey revealed, unsurprisingly, that the industry is much less confident now of being in a position to make a major investment over the next twelve months. With access to credit very tight, you cannot spend what you do not have. Most respondents to our survey were adamant that we do not need any more ships, and indeed that we already have too many to carry the level of trade on offer. The survey also showed, however, a fall in the number of respondents who expected finance costs to increase over the coming year. So, despite all the difficulties, now is a good time to buy, for those with access to money and a sound business plan. No industry can grow without continuing investment.

“There could be some nasty surprises, and some tough decisions, in the months ahead for operators and investors alike. But those who are in shipping for the long term will ride it out, and many will have had previous experience of doing just that. The international nature of the industry may be working against shipping at the moment, but it will once again prove to be its strength in less troubled times.”

The Moore Stephens Shipping Confidence Survey includes responses from key players worldwide in the international shipping industry to a targeted, web-based survey by the Moore Stephens Shipping Industry Group. Responses were received from owners, charterers, brokers, advisers, managers and others. Editors can apply for a copy of the survey by emailing

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping and insurance adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 638 offices of independent member firms in 97 countries, employing 20,588 people and generating revenues in 2010 of $2,151 billion.

For more information:
Richard Greiner, Moore Stephens LLP
Tel: +44 (0)20 7334 9191

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Friday, 23 September 2011

Vestdavit to supply extra-long outreach seismic multipurpose davits

Norway-based boat handling system and specialised davit supplier Vestdavit has been contracted by Mitsubishi Heavy Industry on behalf of Petroleum Geo-Services (PGS) to design and supply extra-long outreach workboat/lifeboat/FRC davits for PGS’s 5th generation Ramform new building seismic vessels.

The two davits for each of the two vessels building at Mitsubishi Heavy Industry, Japan for 2013 delivery will have an extra-long outswing to be capable of launching and recovering 20 man tender boats safely in seas states 5 – 6.

Vestdavit has designed a special Vestdavit H – 10000S dual point hydraulic davit with a dual winch system for the application.

Atle Kalve, development manager, Vestdavit, says, “These davits will make deployment and retrieval safer for PGS’ crews. The tender boats will normally be used in relatively calm sea states, but are constructed to handle safely even in sea state 6, and these davits will recover them safely in those seas.”

The boats and davits also have the function as lifeboats and Fast Rescue Craft in an emergency.

A key benefit of these davits is the simplicity of use, which reduces crew training needs. They are also extremely robust and will work a long time on station without servicing.

The characteristic Ramform design seismic survey vessel has only a short flat parallel ship side for the boat to lie against. To overcome this Vestdavit will supply a painter boom travelling 12 metres, the longest ever supplied by Vestdavit. Both boom and davits are computer controlled with inbuilt auto tension and shock absorption to allow the boat to launch and recover safely in high seas.

Kalve says, “These boats will be used daily at sea for personnel and crew changes and supply between the support vessel and the seismic vessel which will continue working. The seismic work boats which would normally be used for this sort of application do not have the capacity for 20 men. The combination boat on the Vestdavit davits can work as a Fast Rescue Craft with six crew, as a tender with 20 persons on board and as a lifeboat with a 40 person capacity.

Our dual point system is designed to fulfil all the different functions needed for this multi operation davit. The davit design delivers launch and recovery that will be both safe and quick in high sea states, which means less risk for the crew and more operational uptime for both the seismic vessel and the support craft.”

Vestdavit is also to design and supply a special shock absorber system for the paravane heavy load lines. It will handle peak loads up to 200 tonnes per shock absorber, again helping to keep the vessel at work despite heavy seas.

For a graphic of the Vestdavit multipurpose system see attachments, go to http://bit.ly/roQ3Hu or e mail john@merlinco.com

Vestdavit designs, supplies and supports tailor-made solutions for launching and recovering boats in difficult conditions at sea. Its range of boat handling systems and davits are the first choice of navies, coastguards, seismic survey operators, pilot authorities and offshore operators who need to be able to operate small boats safely from larger vessels. Since 1975 Bergen-based Vestdavit has supplied over 1,800 davits and side and stern launch systems. They have proven themselves over more than 30 years use in the North Sea and other harsh environments around the world. Self-tensioning and shock absorbing systems ensure crew safety and widen the operational window for the users. Vestdavit’s key focus is on operational effectiveness, safety and the reliability of its equipment. http://www.vestdavit.no/

For more information:

Atle Kalve
+ 47 45 21 97 31

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Wednesday, 21 September 2011

Bureau Veritas launches Condition Assessment Programme for Yachts

Leading international classification society Bureau Veritas has extended its successful Condition Assessment Programme to cover all types of yachts. BV Yacht CAP will provide owners with a certified and recognized evaluation of the real status of any yacht to promote the yacht’s condition to charterers, brokers, yacht managers, banks and leasing companies.

“Big yachts are big business but a high risk area for charterers and financiers,” says Vincent Lefebvre, Head of CAP and Environment section, Bureau Veritas. “BV Yacht CAP helps them manage that risk by carrying out a full assessment of the structure and outfit of the yacht and applying a Condition Assessment Programme rating to the vessel. It applies to all yachts, both pleasure and charter, regardless of length, and quantifies the actual condition of the yacht, independently from its class or age. The vessel does not have to be BV class to benefit, we can do this for any yacht, classed or not.”

An inspection of the hull, equipment and machinery systems allows the assignment of a score from 1 to 4, depending on the characteristics of each yacht and according to the survey chosen. These can be a CAP Standard Survey carried out afloat, an Extended CAP Survey which includes dry dock or underwater survey and Comfort CAP Survey which also includes sea trials.

Says Lefebvre, “We have built a globally successful CAP programme for oil tankers, gas carriers and ships of all types, meeting the strict standards of oil majors and international charterers and banks. We have now blended our expertise and software in the CAP field with our experience with yachts to produce a useful and flexible tool for evaluating yachts. The BV Yacht Cap covers hull structure, hull and deck equipment and fittings, propulsion and auxiliary machinery, fittings and systems and the bridge and navigational and communications system. It’s a full and detailed snapshot of the vessels’ condition, and it is delivered quickly and in an easy to digest format.”

BV has recently slashed reporting time for CAP surveys and improved accessibility and usability of the report through the development of patented software specifically designed for Condition Assessment purposes. Users get a detailed report illustrated with representative pictures and a CAP Certificate with a CAP rating giving a quick and easy understanding of the yacht's condition. All backed by the certification of a global classification society and Recognised Organisation.

The new CAP Reporting Software was designed in liaison with clients and ship vetting entities. Using a web-based interface the tool is installed on surveyors’ lap tops. The database of the spaces and important machinery equipment is automatically down loaded from BV's class database Neptune if the unit is BV class or uploaded for next time use if the vessel is not BV class. Reporting time is vastly reduced by use of drop down menus and eliminating duplication of data. Drop down menus ensure that CAP survey reports use common language and common phraseology throughout the BV network. Automatic calculation of scores and award of ratings takes away the possibility of calculation errors.

The final very easy to read report is downloadable in pdf format or can be read directly on line with magazine style page turning software. The client has the option of making it available on line to charters, banks, potential buyers and others.

Bureau Veritas is a world leader in conformity assessment and certification services. Created in 1828, the Group has close to 50,000 employees in 930 offices and 330 laboratories located in 140 countries. Bureau Veritas helps its clients to improve their performances by offering services and innovative solutions in order to ensure that their assets, products, infrastructure and processes meet standards and regulations in terms of quality, health and safety, environmental protection and social responsibility.

www.bureauveritas.com for corporate information www.veristar.com for marine information

Visit Bureau Veritas at Monaco Yacht Show Booth No: QP65
A breakfast briefing will be held on this booth today Wednesday 21 September 2011 at 11:00 am

For more information:
Vincent Lefebvre
Bureau Veritas France
+33 1 55 24 72 68

Stefano Brigandi
Bureau Veritas Italia
+39 010 585 439

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Tuesday, 20 September 2011

Bureau Veritas extends Russian partnerships

Bureau Veritas is extending its partnerships in the Russian shipping and offshore sector, focussing on High Arctic offshore projects. Bureau Veritas and the Russian Register are working together to provide basic design review for the Shtokman FPU for the two tenderers: SAIPEM, SAMSUNG and SOFEC (SSS) and AKER, TECHNIP and SBM (ATS). The process has called for a comparison between BV and RS rules, design review and documentation review, and performance of thermal, linear and non-linear hydrodynamic and structural calculations with VeriSTAR Hull.

BV’s Offshore Rules have been translated into Russian and co-operation agreements have been reached with the Russian Register and the University of St Petersburg.

“The challenges of extracting oil and gas from the tough environments of the high Arctic have led to close co-operation between Bureau Veritas and the Russian Register, and close links between Bureau Veritas and the University of St Petersburg,” explains Bernard Anne, managing director of BV’s marine division. “There is huge potential in the exploitation of oil and gas fields in the High Arctic, and we are working with the main offshore operators and our Russian partners to ensure the natural resources can be harvested to benefit Russia and that it is done safely and cleanly.”

BV has also provided services to the Shtokman and other Russian projects including Independent Verification Body Services to provide assurance of design integrity at the FEED stage of disconnectable floating production platforms, the offshore trunk pipeline and subsea production systems.

Bureau Veritas and the Russian Maritime Register of Shipping are working under a three-year co-operation agreement covering the development of joint guidelines for LNG carriers and Offshore Floating Production Units (FPUs).

“We can combine the particular strengths of the BV and RS rules, to produce definitive guidelines which draw on the experience and expertise of both organisations,” explains Anne.

Under the agreement, common guidelines for LNG carriers, based on GAP analyses as well as the BV and RS rules and the IMO IGC Code, are expected to be published in first-quarter 2012. These will include the requirement for operating in Arctic areas. Work on producing common guidelines for FPUs has begun. In addition to the parameters used for the LNG guidelines, these will include feedback gained from the work on the Shtokman natural gas field.

In a separate development the leading Russian design office Severnoje has selected BV as the class society for its new Medmax LNG carrier design.

BV joined forces with the State Maritime University of St Petersburg to develop IceSTAR, an industrial software tool for modelling ice loads and their effects on structures. The program dramatically improves the structural design of new generation of large LNG carriers and offshore floaters for use in heavy ice conditions.

Bureau Veritas is a world leader in conformity assessment and certification services. Created in 1828, the Group has close to 50,000 employees in 930 offices and 330 laboratories located in 140 countries. Bureau Veritas helps its clients to improve their performances by offering services and innovative solutions in order to ensure that their assets, products, infrastructure and processes meet standards and regulations in terms of quality, health and safety, environmental protection and social responsibility.

www.bureauveritas.com for corporate information, www.veristar.com for marine information.

Visit Bureau Veritas at NEVA, St Petersburg, 20 -23 September. Hall 7 Booth No 723

For more information:
+7 812 324 71 26/24

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Bureau Veritas launches new Rules for Yachts and Megayachts

Leading international classification society Bureau Veritas is launching a fully updated set of classification rules for yachts and megayachts. The Rules cover design approval, material and equipment certification and construction surveillance at the yard for single yacht building or for production in large series following an alternative survey scheme. Motor and sailing yachts of mono or multi hull type, built in steel, aluminium alloys or composite materials are covered. A major addition to the new Rules is a set of standards applicable to very large charter yachts and yachts with over 12 passengers. These standards bridge the gap between international conventions applying to passenger ships and yacht industry standards.

In addition to the classification of yachts, these Rules are also applicable within the scope of European Community certification for pleasure yachts ranging up to 24 m, with Bureau Veritas then acting as notified body.

The new Rules update BV’s 2006 Yacht Rules and incorporate feedback in service of yachts built to those rules. They also include additional class notations covering comfort on board, operation in ice and helicopter facilities. BV has also developed a specialised software package which is dedicated to the calculation of yacht structures built in composite materials, which is linked to the new Rules.

The new Rules also contain appropriate technical standards for large charter yachts over 500 UMS and/or yachts carrying passengers which fall into the category of passenger ships under International Conventions such as SOLAS. At present, there is a technical approach consensus in National Flag Regulations covering charter yachts over 500 UMS or charter yachts carrying less than twelve passengers. The regulatory environment becomes more difficult for charter yachts carrying more than twelve passengers. These yachts, engaged in trade, are covered by IMO Conventions and are to be considered as passenger vessels. These conventions, developed for passenger vessels carrying hundreds or thousands of passengers, are not easy to use for a yacht design. The new BV Rules develop a new set of requirements, close to the international conventions but customised to the yacht industry standards.

These requirements cover hull construction materials including the use of composite materials, stability criteria and damage stability, emergency sources of electricity power equipment and fire safety equipment. They are defined on the basis of SOLAS and Load Line conventions requirements for passenger ships carrying between twelve and thirty six passengers. The driving principle is to assist the designer and yard with an alternative approach as an equivalent basis to the international conventions. Bureau Veritas classification can speed the flag approval for each yacht project.

Bureau Veritas is a world leader in conformity assessment and certification services. Created in 1828, the Group has close to 50,000 employees in 930 offices and 330 laboratories located in 140 countries. Bureau Veritas helps its clients to improve their performances by offering services and innovative solutions in order to ensure that their assets, products, infrastructure and processes meet standards and regulations in terms of quality, health and safety, environmental protection and social responsibility.

www.bureauveritas.com for corporate information, www.veristar.com for marine information.

Visit Bureau Veritas at Monaco Yacht Show booth No: QP65

A breakfast briefing will be held on this booth on Wednesday 21st September 2011 at 11:00 am

For more information:
Benjamin Collier
Bureau Veritas France
+33 2 40 92 48 15


Monday, 19 September 2011

On its 150th anniversary RINA celebrates ties with China

International certification, verification and ship classification company RINA is celebrating its ties with China on its 150th anniversary. It also took the opportunity to celebrate the ties between Italy and China on the 150th anniversary of Italian Unification.

Formed in Genoa, Italy, in 1861 as a ship classification society, RINA is today a global multi-disciplinary and multi-cultural company with growing business in China and the surrounding region. Today in Shanghai RINA CEO Ugo Salerno and Vincenzo De Luca, Consul General of Italy in Shanghai, hosted Italian business leaders and diplomats, representatives of the Chinese government, regional government, maritime authorities and business leaders from all sectors including the Italian Private Shipowners Association and its President Paolo D’Amico for a discussion and gala dinner.

The cultural and business ties between RINA, Italy and China were illustrated by a series of presentations by leading Chinese shipyards, Italian shipowners and banks from both countries. There was lively and fruitful discussion on ways for the Italian and Chinese shipping industries to strengthen collaboration, and ways for banks from both countries to work together and promote further international investment.

Speaking at a reception to mark the event held at the Grand Hyatt hotel, Shanghai, Ugo Salerno, CEO, RINA, said, “We are very happy to be here in China today, celebrating both our growing relationships with Chinese partners and our 150 years of experience and tradition. We share the goals of our partners here, working to build a sound resilient business, respecting people, community and environment. We provide experience and competency to support industry and society to improve their activities and the quality of life.

“We are active in every area of industry, transportation and environmental protection, and we reach out globally to help companies which are also globalising, as so many of you are here in China. We help by bridging the gap in competency for newcomers to the global market place to boost their competitive capacity on the global market.”

In China RINA is happy to work with some very forward looking companies and authorities including for example Baosteel, shipyards of CSSC and CSIC Groups, Hollysys, Jimei Hua Shipping, New Yangzijiang Shipbuilding, New Time, STX Dalian, Shanghai Waigaoqiao Shipbuilding, Tuofu Ocean Shipping and MSC Hong Kong.

RINA today works in a multi-disciplinary way to service a wide range of industries. RINA is now a well-known certification body in China having certified over 300 Chinese companies in accordance with international certification schemes such as ISO 9001, ISO 14001, OHSAS 18001, SA 8000, ISO 27001 and several code of conduct standards.


Maritime classification continues to be the backbone of RINA’s global activities. Last year the classed fleet grew strongly by twenty per cent and at the end of June 2011 the RINA classed fleet was 4,250 ships totalling 32.6m gt. The growth came from newbuildings joining the fleet and from foreign owners, in particular Chinese and Greek choosing to transfer modern ships into RINA class. The current fleet is now well diversified with a strong presence in each sector - bulk, dry cargo, tanker, passenger, warships and service craft - and an increasingly global distribution of owners. The lower average age of the fleet, strengthened support services for owners and a relentless focus on quality paid off as the Paris MOU rated RINA the best performing Recognised Organisation and leading classification society in 2010 based on port state control results.

RINA’s marine business in China has expanded dramatically together with the local shipping community and shipyards. RINA’s classed Chinese fleet has grown to more than 120 ships, and RINA has over 40 new building projects in China, totalling over 4 million gt. Many of China’s emerging shipowners are turning to RINA for support, including Jimei Hua Shipping and Tuofu Ocean Shipping, both having several vessels classed with RINA, and each also having kansarmax bulk carriers newbuilding with RINA class.

RINA is classing ships building at leading Chinese shipbuilding groups CSSC, CSIC, New Yangzijiang, New Time, STX Dalian and Shanghai Waigaoqiao Shipbuilding, including a 300,000 dwt ore carrier and a 206,000 dwt bulk carrier. Very recent deliveries in China include the first of a series of specially designed self-unloading supramax bulk carriers built at Hantong Shipyard for Coeclerici, the sixth of twenty-nine 93,500 dwt bulk carriers being built by New Jiangsu Yangzijiang shipyard for Giuseppe Bottiglieri and the first of a series of minicape bulkers to be built at Sinopacific for SNUG.

RINA is also very active in conversions from tanker to bulker and container carrier to general cargo. RINA has successfully converted more than 30 vessels in the last three years in China, in sizes from 20,000 dwt to 270,000 dwt.

Oil, gas and power generation

RINA has a strong focus on energy. RINA works with leading companies at every stage of the energy chain - generating energy, harnessing it from the oceans and elements, transporting it, measuring it and conserving it. RINA is working in all fields of power generation, including clean coal and nuclear, and renewable energy activities are increasing. In China, qualification with the authorities and leading contractors led to major contracts for the certification of offshore platforms and for supervision of the construction of an OSV. A major area of work is supplier qualification for international groups such as ENI and Ansalado Energia. In China CNOOC, Bao Steel and Liaoning Large-scale Steel Pipe are some of the companies RINA has worked with. In the renewable energy sector RINA is working with a number of companies, especially those involved in photovoltaic panel manufacture. These include Suntech Power, CEEG (Shanghai) Solar Energy S&T, Shanghai ST-Solar and Upsolar.

Products, personnel, services and processes

Quality management certification is a core business for RINA and, in 2010, more than half of certification was outside Italy. Social Accountability is growing and RINA is now the leader in Europe and second globally in this field. Globally RINA certifies more than 1,500 companies each year including many industry leaders in China such as Baosteel, Asian Star Anchor Chain, Hudong Heavy Machinery and Jiangyin Beihai LSA.

Transport and logistics

RINA’s services to transport are growing and RINA recently entered the aerospace sector for the first time and developed its own railway signalling and onboard equipment testing laboratory. It is a European leader in railway certification and is working with railway equipment manufacturers around the world. Chinese manufacturer Hollysys turned to RINA for conformity tests on antenna/BTM components of the European command and signalling system ETCS.

Climate change services

RINA provides a range of high-quality services in the climate change area. As a DOE accredited by UNFCCC, RINA has participated in over 300 greenhouse gas projects around the world. Climate change clients in Asia include the World Bank, Asia Development Bank, Toyota and China National Petroleum Corporation. Globally RINA has worked with majors that include Tricorona, Vitol, Arcadia, Bionersis, Orbeo, EDF, Enel, Eni, and Marubeni delivering environmental mitigation services covering the fields of energy, chemical, manufacturing, construction, transport, agriculture, forestry, waste handling and coal mining. RINA also provides social carbon audits, GHG inventory and carbon footprint services including verification of annual reports for the aviation sector.

RINA globally

Group turnover is Euro 205m, and RINA employs 1,438 qualified staff. Those staff now represents forty-six different nationalities, and over 60 per cent are graduates. They are close to their clients, in 120 offices in 42 countries, including several new countries during 2010. The first China office was opened in late 1997 and RINA currently employs 120 staff in China in the Shanghai head office and ten regional offices. RINA’s Shanghai office is now the largest RINA office outside its main office in Italy. In China there is a dedicated plan approval centre, and ten surveyor stations in key locations. There are plans to expand.

RINA is one of the oldest classification societies and certification companies in the world. Established in Genoa in 1861 to serve the marine industry, today it spans the globe as a multinational and multi-faceted company, sharing its knowledge and experience through a wide range of services which help industries and the community to improve their businesses and quality of life. RINA’s services cover climate change, environment, energy, transportation, logistics, safety, quality and social responsibility.

For more information:

Roger Qi Hua
Marketing Manager
RINA China
+86 21 6248 2905
+86 136 8175 6103

Giulia Faravelli
Media Relations
+39 010 5385505

Thursday, 15 September 2011

Marco Polo Seatrade gets bank backing

Marco Polo Seatrade has received court approval to obtain fresh financing from Royal Bank of Scotland, one of its senior lenders. The New York Court supervising the reorganisation of Marco Polo approved today new financing to be provided by the Royal Bank of Scotland. This financing is being provided on a fully consensual basis and resolves the various objections that were filed to Marco Polo’s original financing motion.

This Court approval and the Court’s previous approval of the use of cash collateral ensures that Marco Polo will be able to continue to fulfil all charter contracts and to pay its expenses in the ordinary course of business. It also ensures that Marco Polo will be able to take advantage of profitable new charters.

Post-petition financing from one of its senior lenders is a significant step towards Marco Polo’s focus on a plan to emerge from Chapter 11 as a strong and healthy competitor in the global shipping market

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Monday, 12 September 2011

Scott Bergeron appointed CEO of LISCR

Scott Bergeron has been appointed Chief Executive Officer of the Liberian International Ship & Corporate Registry (LISCR), the US-based manager of the Liberian Registry.

Bergeron joined LISCR in 2000 as Chief Operating Officer. Prior to that, he developed a wide range of experience in the shipping industry, working for shipowner/manager Laurin Maritime, for Det Norske Veritas and for the US Coast Guard, as well as gaining practical seagoing experience on a variety of different types of ship.

Yoram Cohen and Adam Cohen will remain as Chairman and Executive Vice-Chairman, respectively, of LISCR. In these capacities, they will continue their active leadership of LISCR’s operations, and governance over its strategic direction and cohesive management.

Commenting on Bergeron’s appointment, Yoram Cohen says, “We are delighted that Scott Bergeron has agreed to accept the appointment as CEO of LISCR. Scott is an experienced shipping professional who understands what responsible ship owners and operators want from a modern ship registry. His organisational leadership, business acumen and commercial drive make him ideally suited to this role. We are happy to have him as part of our team at LISCR.”

Adam Cohen adds, “With the help of the Liberian Maritime Authority, Scott and LISCR’s professional staff, the Liberian Registry has enjoyed a period of remarkable growth since LISCR assumed management responsibility for the flag in 2000. In that time, the Liberian-flag fleet has more than doubled in size. Today, it stands at 3,700 vessels, aggregating 120m gross tons - an all-time record. I am certain that Scott will drive the registry on to even greater heights.”

Bergeron, expressing his gratitude to LISCR’s Chairman and Executive Vice-Chairman for the trust they have shown in him, says, “I am honoured to accept this new appointment. I am proud of what LISCR has achieved over the past ten years and grateful to my colleagues who have been essential in achieving this success. As with every other aspect of shipping, it is about the people, not simply the numbers. While the Liberian-flag fleet has been growing, the registry has continued to expand on its capabilities and experience, earn independent recognition of its technical and operational excellence and improve its outstanding safety record.”

Promising to build on LISCR’s successful track record as a premier shipping registry, Bergeron says, “The fleet is still growing – by more than 20 per cent over the past twelve months in terms of numbers of ships, and more than 10 per cent when measured in gross tons. There is more to come. Our success is down to teamwork, and I relish the opportunity to continue working with Yoram and Adam and my colleagues at LISCR, and the Liberian Government, to provide a service which responsible ship owners clearly need and want.”

For LISCR photos, go to: http://picasaweb.google.com/Merlinclients/LiberianRegistry

The Liberian Registry is one of the world’s largest and most active shipping registers, with a long-established track record of combining the highest standards for vessels and crews with the highest standards of responsive service to owners. It has recently surpassed all-time tonnage records. www.liscr.com

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London Club says owners must not accept exemptions from IMSBC code for DRI cargoes

THE London P&I Club has urged shipowners to be alert to any attempt by shippers and other cargo interests to claim exemptions from the International Maritime Solid Bulk Cargoes (IMSBC) Code in connection with the carriage of DRI (Direct Reduced Iron) cargoes.

Long-standing concerns about the carriage of DRI - involving the possibility of a chemical reaction between the cargo and water, leading to the risk of fire and explosion - prompted the introduction of specific provisions for the carriage of DRI in the IMSBC Code. Under these provisions, DRI cargoes should have a maximum moisture content of 0.3 per cent and be carried under an inert gas blanket, and ships carrying DRI should be capable of maintaining oxygen levels of below 5 per cent throughout the voyage. Attempts to allow certain grades of DRI – principally those shipped from Venezuela and Trinidad – to be carried with significantly higher moisture contents and/or without the need to deploy inert gas, have been rejected by IMO.

The London Club says that, despite this, it is aware that attempts have been made by a Trinidadian company to ship HBI Fines (now known as DRI C) without complying with the mandatory requirements of the IMSBC Code. The Trinidadian shipper apparently relied on a provision in Section 1.5 of the code, which contemplates the possibility of alternative carriage arrangements by stipulating, “Where this code requires that a particular provision for the transport of solid bulk cargoes shall be complied with, a competent authority or competent authorities (port state of departure, port state of arrival or flag state) may authorise any other provision by exemption if satisfied that such provision is at least as effective and safe as that required by this code.”

The Trinidadian shipper offered an exemption certificate from the competent authority in Trinidad for the carriage of DRI C with a moisture content above 0.3 per cent and suggested that the cargo could be carried safely if the holds were mechanically ventilated to prevent the build-up of hydrogen. But Ian Barr, a Claims Director with A Bilbrough & Co, the London Club’s management team, says the club doubts whether mechanical ventilation can ever be regarded as being ‘at least as effective and safe’ as the use of an inert gas blanket.

Writing in the latest issue of the club’s StopLoss Bulletin, Barr says, “As most bulk carriers likely to carry DRI will have only ‘natural’ ventilation, hold fans would have to be fitted at the load port. The club has seen documents suggesting that, on at least one occasion, the fans proposed were not certified ‘explosion-proof’, meaning that they had not been specifically designed for use in flammable atmospheres and could be a possible source of ignition. Also, the fans appeared to be too small and were badly sited, limiting their ability to prevent the accumulation inside the hatch coaming of any hydrogen given off by the cargo.”

The club has advised its members that any suggestion that an exemption from the requirements of the IMSBC Code will be invoked should be reported to it immediately.


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Tuesday, 6 September 2011

Bureau Veritas extends class to cover offshore drilling safety

Leading international classification society Bureau Veritas has extended its classification rules to include the items of drilling equipment which are essential for the safety of offshore drilling operations. These cover well control equipment including Blow-Out Preventers, marine risers, tensioning systems, heave-compensation systems, drawworks, mud circulating systems, cementing equipment, drilling derrick and supporting structures. Offshore drilling operators can turn to one body to assess the entire drilling unit and equipment under one integrated approach.

Dan Frorup, Vice President, Offshore Deep Sea Global Business Unit, Bureau Veritas, says, “The Deepwater Horizon incident has shown the offshore industry that dividing responsibility for the safety assessment of offshore vessels from that of the equipment they use is not the best way to drill safely offshore. A holistic approach which assesses the drilling equipment and well control equipment along with the floating unit they are deployed from will deliver safer offshore drilling.”

Bureau Veritas has completed a full review of classification and certification of offshore drilling rigs, reacting to the needs of both industry and national authorities concerned with the safety of offshore drilling. A new set of rules, NI 569, cover the classification of new generation drillships. Drillships are Mobile Offshore Drilling Units particularly adapted for drilling operations in deep to ultra-deep offshore environment. The rules include an update to the IMO MODU Code due to come into force in 2012.

“We have updated the rules for all types of drill ship,” explains Frorup. “But now we have gone further and added the possibility to class all the drilling equipment which is safety-related at the same time. It will substantially increase overall safety and environmental protection.”

Units classed under BV’s offshore rules can add the optional notation DRILL, published in NI 570. DRILL covers all safety-related drilling equipment. DRILL is applicable to all types of offshore rigs including drillships, semi-submersible, jack-up and Tension Leg Platforms.

The new structural Rules in NI569 cover the hull assessment with particular attention to the interface between the hull and structures supporting drilling equipment. Structural assessment is based on specific loading configurations considering typical operations of drillships, including transit, drilling preparation, BOP running, casing running, normal drilling, standby at the intended site and survival. New structural requirements are explicitly defined for moonpool area and moonpool structural details, including hydrodynamic effects. Prescriptive requirements for safety aspects are complemented by risk assessment techniques which are consistent with the requirements of various national regulations.

Both NI569 and NI570 DRILL Rules cover design assessment criteria, construction survey, qualification of novel technology and in-service survey. Technical requirements of recognised standards widely used by drilling industry, such as API, are taken account of in NI 570 as is on-going feed-back from BV’s industrial partners in the drilling industry to ensure the rules remain current with the latest technology and also expected changes to national requirements.

Bureau Veritas is a world leader in conformity assessment and certification services. Created in 1828, the Group has close to 50,000 employees in 930 offices and 330 laboratories located in 140 countries. Bureau Veritas helps its clients to improve their performances by offering services and innovative solutions in order to ensure that their assets, products, infrastructure and processes meet standards and regulations in terms of quality, health and safety, environmental protection and social responsibility.

http://www.bureauveritas.com/ for corporate information, http://www.veristar.com/ for marine information.

Visit Bureau Veritas at Offshore Europe, Aberdeen, 6 – 8 September. Hall 3, Booth No 3E123

For more information:

Catalin Toderan
Bureau Veritas
+33 1 55 24 74 87


Friday, 2 September 2011

Marco Polo Seatrade receives court approval to continue to use revenues in the business

The Marco Polo Seatrade group of companies that filed for Chapter 11 on 29th July 2011 has taken a significant step forward in the US Chapter 11 restructuring process. The New York Court supervising the reorganisation of Marco Polo approved on 31st August 2011 the continued use by the company of the cash collateral, meaning the revenues deriving from the day to day employment of its fleet, for the duration of the Chapter 11 cases. The approval was granted with the consent of Marco Polo’s primary lenders Credit Agricole and Royal Bank of Scotland.

With this court approval, Marco Polo’s customers and vendors can be assured that Marco Polo will be able to continue to fulfil all charter contracts and to pay its expenses in the ordinary course of business. This approval also positions Marco Polo well to focus on a plan to emerge from Chapter 11 as a strong and healthy competitor in the global shipping market.


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