Moore Stephens says ship operating costs are set to increase for 2016 and 2017

Vessel operating costs are expected to rise in both 2016 and 2017, according to the latest survey by international accountant and shipping consultant Moore Stephens. Repairs and maintenance and spares are the cost categories which are likely to increase most significantly in each of the two years.

The survey is based on responses from key players in the international shipping industry, predominantly shipowners and managers in Europe and Asia. Those responses revealed that vessel operating costs are expected to rise by 1.9% in 2016 and by 2.5% in 2017.

The cost of repairs and maintenance is expected to increase by 1.7% in 2016 and by 1.9% in 2017, while expenditure on spares is predicted to rise by 1.7% in 2016 and by 1.8% in 2017. The cost of drydocking expenditure, meanwhile, is predicted to increase by 1.5% and 1.8% in 2016 and 2017 respectively.

The survey revealed that the outlay on crew wages is expected to increase by 1.3% in 2016, rising to 1.8% in 2017, with other crew costs thought likely to go up by 1.2% and 1.4% respectively for the years under review.

The increase in outlay for lubricants is predicted to be 0.8% and 1.4% in 2016 and 2017 respectively, and that for stores 1.3% and 1.7%. Meanwhile, projected increases in management fees are 1.0% and 1.2% in the two years under review.

The cost of hull and machinery insurance is predicted to rise by 0.9% and 1.1% in 2016 and 2017 respectively, while for P&I insurance the projected increases are 1.1% and 1.2%.

The predicted overall cost increases for 2016 were highest in the container ship sector, where they averaged 3.3% against the overall survey increase of 1.9%. By way of contrast, predicted cost increases for 2016 in the offshore sector were just 0.2%. Container ships also headed the expected cost increases for 2017, at 3.4% compared to the overall survey average of 2.5%. Tankers featured in second place for both years at 2.5% for 2016 and 2.9% for 2017.

The mood of respondents generally was quite pragmatic, with many referencing the need to address such familiar problem areas as over-tonnaging, excessive competition, a paucity of finance, rising fuel costs and burgeoning regulation and legislation. “An even greater discrepancy is expected between operating costs and freight rates,” said one respondent. “Owners will manage to make ends meet, but barely.”

Despite the expectation of increased crew costs, one respondent predicted, “Crew wages will drop as owners look for cheaper nationalities or mixed crewing,” while another said, “Reduced global trade demand will offset pressure for higher crew salaries.” Elsewhere it was noted, “Crew costs are very much dependent on the employment of ships. The whole management process will undergo substantial restructuring, with flags and other stakeholders needing to be more pragmatic regarding MLC compliance and vessel operation.” Another respondent, meanwhile, said that sourcing good quality crew could be a problem as “many have changed profession.”

The cost of meeting regulatory requirements was high on the list of concerns cited by respondents, one of whom noted, “Operating costs will rise for technical expenses such as maintenance and repair held over from previous years, while the cost of ballast water treatment plant will have to be taken into consideration in 2017 drydocking budgets.” Another respondent pointed out, “With the Ballast Water Management (BWM) convention coming into force in 2017, drydocking costs will increase significantly, depending on the type and size of ship involved.” And yet another warned, “As the quality and reliability of machinery and equipment in general deteriorates, then so the cost of maintenance increases.” Elsewhere it was noted, “The new international standards for limiting NOx, SOx and PM emissions from vessels will substantially increase operating costs.”

More than one respondent emphasised the need to keep down labour and management costs without sacrificing quality. One said, “Operating budgets have been pushed further and further south, with numerous managers willing to ‘low-ball’ operating budgets to catch the eye of new and existing owners. This can cause severe risk to the operating condition of vessels, but it appears that owners are willing – or have no choice but – to accept operating budgets which include unattainable assumptions and to fund additional cash call requirements where they become necessary.”

Respondents were also asked to identify the three factors that would most affect operating costs over the next 12 months. Overall, 20% of respondents (compared to 22% in last year’s survey) identified finance costs as the most significant factor, followed by competition at 19% (down from 22% last time). Crew supply was in third place with 18% (up one percentage point on last time), followed by demand trends (up by one percentage point to 17%) and labour costs, unchanged at 13%. The cost of raw materials was cited by 11% of respondents (compared to 8% in last year’s survey) as a factor that would account for an increase in operating costs.

Richard Greiner, Moore Stephens Partner, Shipping & Transport, says, “The predicted increases in ship operating costs for 2016 and 2017 compare to an average fall in operating costs in 2015 of 2.4% across all main ship types recorded in the recent Moore Stephens OpCost study. And whilst the level of predicted increases for this year and next will undoubtedly be of concern to owners and operators, seasoned market operators and observers alike will not need particularly long memories to call to mind increases of more than eight times the levels predicated for 2016. In 2008, for example, the average operating cost increase absorbed by the industry was no less than 16%. Meanwhile, one year ago, expectations of operating cost increases in 2016 were 2.8% on average, so the fall in that expectation to 1.9% is of note.

“It is some time since crew wages failed to register the highest level of predicted cost increases in our survey, but such was the case with the forecasts for 2016, where repairs and maintenance costs headed the list, together with spares. This may be due to a number of factors, including the need to commit to repairs and maintenance deferred in earlier years, and the opportunity to do so at a time when the alternative may be to struggle to compete in a difficult economic and industry climate.

“Repairs and maintenance also topped the predicted operating cost increases for 2017, at 1.9%, ahead of crew wages, drydocking and spares, all at 1.8%. This is not a surprise given predicted increases in global steel prices and the fact that regulation and legislation, mandated and enforced mainly by IMO and Port State Control respectively, are now so tight in terms of both safety and environmental preparedness and responsibility. Above all, shipping needs safe ships and safety-minded crews to stay afloat, and both come with a heavy price-tag.

“One highly influential factor behind the anticipated rise in drydocking costs, most notably in 2017, is the entry into force of the Ballast Water Management Convention in September 2017, before which date some owners may choose to put their ships into drydock to ready them for the new legislation.

“The anticipated rise in crew wages and other crew costs, meanwhile, is arguably lower than anticipated, and there was indeed a feeling on the part of some respondents that, despite the entry into force of the Maritime Labour Convention 2006, wages could stabilise this year or even go down, due largely to the combination of a reduction in global trade and wider recourse to cheaper, less experienced manning alternatives.

“Shipping faces a number of potentially costly compliance responsibilities, including the imposition of an 0.5% global cap on sulphur emissions with effect from 2020. Other operating issues include predicted increases in the price of fuel, albeit from comparatively low levels, as OPEC looks to reduce oil production levels. This will have a knock-on effect on lube oil costs.

“Shipping is an industry suffering from an imbalance in supply and demand, illustrated by the chronic overcapacity in many trades, never mind that BIMCO recently reported that the shipbuilding sector faces its lowest level of newbuildings for 20 years. But it is an industry with a guaranteed future, witness the recent decision of lMO to select ‘Shipping: Indispensable to the World’ as its theme for World Maritime Day 2016. Just how healthy that future will be depends on the ability to generate sustainable profits after operating costs have been met.”

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 657 offices of independent member firms in 106 countries, employing 27,613 people and generating revenues in 2015 of $2.7 billion. www.moorestephens.co.uk

For more information:
Richard Greiner
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
richard.greiner@moorestephens.com

Liberia leads drive to ensure effective implementation of BWMC

Liberia is leading a move to amend the Ballast Water Management Convention (BWMC) which will allow certain ships additional time beyond 2020 in order to ensure that adequate new ballast water management (BWM) systems are commercially available, along with the necessary dockyard space for installation.

Following representations made by Liberia at last week’s meeting of IMO’s Marine Environment Protection Committee (MEPC70) in London, David Pascoe, Senior Vice-President, Operations & Standards at LISCR, the US-based manager of the Liberian Registry, says, “Against significant odds, Liberia and other industry representatives at IMO were able to garner sufficient support from a majority of IMO members during MEPC70 to create an opportunity to re-visit the installation deadline through alternative proposals to amend the convention.

“There are two major constraints effecting smooth implementation and compliance with the convention – namely, lack of availability of systems that will meet the performance standards, and the evident lack of sufficient installation capacity. We are pleased that MEPC 70 adopted and advocates the early use of new guidelines for approval of BWM systems. Concerns remain however, that it might be several years before new IMO-approved equipment is readily available and that, with effect from 8 September 2017, tens of thousands of ships may be required to install existing systems that may not fully comply with the convention standards.

“We are equally pleased that MEPC agreed to our proposal for a review to determine whether a sufficient number of BWM systems are approved and available when required and will perform reliably, where and when necessary.

“The alternative amendment drafted by Liberia, industry and supporting states will go forward, together with the amendment approved by MEPC 69, to MEPC 71 in first-half 2017 for final consideration. We intend to work with other interested IMO member states and industry in advance of MEPC 71 to see if common ground can be agreed on one set of amendments. An amendment cannot be adopted until the MEPC 72 meeting in first-half 2018, after the convention enters into force.”

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ITIC warns that failure to follow lay-up procedure can be costly

International Transport Intermediaries Club (ITIC) has reported a case in which a lay-up manager was held liable for a $250,000 contribution to a claim for extensive damage to a vessel whilst in lay-up.

The lay-up manager, as agent for the owner, arranged for a contractor to fit internal blanks to the sea valves of a vessel going into cold lay-up. Subsequently, the vessel’s main engine flooded after the valve to the main cooling seawater line was accidentally opened, resulting in serious damage to the machinery and electrics.

The damage survey found that the internal blanks had not been fitted properly by the contractor, and the owner claimed against the contractor for about $3m. Amid concern that the contractor would not be able to meet such a claim, the owner turned its attention to the lay-up manager, alleging that good practice dictated that all sea valves were to be fitted with internal blank flanges. It added that external sea suctions should have been closed off by divers using fibreglass blanks fitted with neoprene seals.

The lay-up manager had not arranged for the external suctions to be blanked, and the owner argued that, had the manager arranged for the external blanks to be fitted, there would not have been any flooding. Although the contractor had clearly failed to do its job properly and was primarily liable for the claim, the lay-up manager was required to contribute $250,000 to the overall settlement, which was reimbursed under its ITIC cover.

ITIC says the case also illustrates how the outcome of claims can depend on the way in which a manager contracts. In this case, the manager had appointed the contractor as agent on behalf of the owner, whose claim lay directly against the contractor. If the manager had agreed to provide the blanking on a lump-sum basis, however, the outcome could have been very different, and the manager would have been liable for the actions of the contractor and left to pursue the contractor in a recovery action.

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



For more information:
Charlotte Kirk
ITIC

Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com

Liberia provides lead with BWMS proposal to IMO meeting

The Liberian Maritime Administration is to introduce a proposal to the meeting of the IMO Marine Environmental Protection Committee (MEPC70) in London on 24 October to allow certain ships additional time beyond 2020 to install adequate ballast water management systems as required under the Ballast Water Management Convention, which comes into force in September 2017. The proposal, says Liberia, would ensure that enough adequate systems and sufficient dockyard space are available.

With effect from 8 September, 2017, most oceangoing ships engaged in worldwide operations will be required to install a ballast water management (BWM) system approved in accordance with IMO guidelines. But it has emerged that the current IMO guidelines are not sufficiently detailed to ensure that BWM systems have been adequately challenged to provide the required confidence that they will meet the required discharge performance standard, regardless of where a ship may operate.

David Pascoe, Senior Vice-President, Operations & Standards at LISCR, the US-based manager of the Liberian Registry, says, “Having conducted additional assessments of IMO type-approved BWM systems intended for installation on Liberian-flag ships, the Liberian Administration has identified certain potential limitations, which have been listed on the Liberian Type Approval Certificate issued to manufacturers. This additional information helps shipowners make informed decisions in connection with BWM systems.

“Liberia actively promoted the revision of the IMO BWMS approval guidelines. It is participating in the revision to make them more transparent, robust and fit-for-purpose, and is offering its proposals for smooth implementation to MEPC 70. These have already attracted strong support from concerned IMO member states and other organisations, with the Marshall Islands reportedly among those electing to follow Liberia’s lead.

“The revised BWMS approval guidelines are expected to be roughly aligned with the robust type-approval regime of the United States, thus establishing a rigorous global standard for BWMS type-approval. But there are no BWM systems currently approved by the US, and it could take several years for equipment approved under the new IMO guidelines to be readily available for installation. In the meantime, tens of thousands of ships may be required to install existing systems that may not fully comply with the convention standards.

“The compliance dates for ships are linked to the date a ship’s International Oil Pollution Prevention (IOPP) certificate is renewed after 8 September 2017. In order to allow more time for new systems to become available and for shipowners to decide which system to invest in and install (bearing in mind that the cost to retrofit a BWMS is estimated to be up to $5m per ship) Liberia has proposed that shipowners may decide if they wish to renew a ship’s IOPP certificate earlier than scheduled in order to have an additional 4-to-5 years to see if new equipment becomes available.

“It is by no means certain that adequate new systems will be commercially available in sufficient quantities within this period. Additionally, based on a study by Liberia, the dockyard capacity to fit systems on board ships will fall well short of peak demand, expected to occur in 2020-2021.

“While the IMO roadmap for implementation of the BWM Convention provides for non-penalization by port states of ships that have installed BWM systems (so-called ‘early movers’), it may be that this equipment will require modification or replacement in the future, as will be the case in the US. It would therefore seem reasonable not to require continued installation of BWM systems which have not been approved under the new guidelines and to allow certain ships additional time beyond 2020 in order to ensure that adequate new systems are commercially available, along with the necessary dockyard space for installation. ”

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Moore Stephens reports fourth successive year of decline in operating costs

International accountant and shipping consultant Moore Stephens says total annual operating costs in the shipping industry fell by an average of 2.4% in 2015. This compares with the 0.8% average fall in costs recorded for 2014, and is the fourth successive overall year-on-year reduction in such costs. All categories of expenditure were down on those for the previous 12-month period. This suggests continued pragmatic management of costs by ship owners and operators, as well as a reduction in active trading for some owners as a result of the prolonged worldwide economic downturn.

The findings are set out in OpCost 2016 (www.opcostonline.com), Moore Stephens’ unique ship operating costs benchmarking tool, which reveals that that total operating costs for the tanker, bulker and container ship sectors were all down in 2015, the financial year covered by the study. On a year-on-year basis, the tanker index was down by 4 points, or 2.2%, while the bulker index fell by 6 points, or 3.6%. The container ship index, meanwhile, was also down by 6 points, or 3.7%. The corresponding figures in last year’s OpCost study showed falls of 2 points in both the tanker and container ship index, and of 1 point in the bulker index.

There was a 1.2% overall average fall in 2015 crew costs, compared to the 2014 figure, which itself was 0.1% down on 2013. By way of comparison, the 2008 report revealed a 21% increase in this category. Tankers overall experienced a fall in crew costs of 1.3% on average, compared to the 0.4% fall recorded in 2014. All categories of tankers reported a reduction in crew costs for 2015 with the exception of Panamaxes and VLCCs, which recorded increases of 1.4% and 1.2% respectively, compared to reductions for 2014 of 2.2% and 0.6%. The most significant reduction in tanker crew costs for 2015 was the 3.6% recorded by Product Tankers.

For bulkers, meanwhile, the overall average fall in crew costs in 2015 was 1.1%, having stabilised 12 months ago at 2013 levels. The operators of Handysize Bulkers paid 2.3% more on crew costs than in 2014, but the operators of other categories of bulker paid less, in the case of Panamax Bulkers to the tune of 3.2%.

Expenditure on crew costs was down 3.3% in the container ship sector, having stabilised in 2014 at the previous year’s level. The biggest fall in crew costs in this category was the 3.6% reduction recorded for vessels of between 2,000 and 6,000 teu.

Expenditure on stores was down by 4.3% overall, compared to the fall of 2.4% in 2014. The biggest fall in such costs was the 8.5% recorded by operators of Capesize Bulkers, with Panamax Bulkers (8.2%) not far behind. Other significant reductions included 2,000-6,000 teu Container Ships (8.0%) and Handymax Bulkers (7.5%). For bulk carriers overall, stores costs fell by an average of 7.7%, compared to a fall of 3.7% in 2014, while in the tanker and container ship sectors the overall reductions in stores costs were 4.3% and 5.5% respectively, compared to the corresponding figures of 0.7% and 3.0% for 2014. The only rise in stores expenditure by any category of vessel was the 1.5% increase recorded by Tankers 5,000 to 10,000 dwt.

There was an overall fall in repairs and maintenance costs of 4.3%, compared to the 0.6% reduction recorded for 2014. Only VLCCs and Container Ships of between 1,000 and 2,000 teu recorded increased expenditure on repairs and maintenance, of 0.1% and 1.3% respectively. Otherwise it was a case of reduced spending everywhere, the most significant example being the 7.9% fall recorded for Coastal Dry Cargo ships.

The overall drop in costs of 3.2% recorded for insurance compares to the 0.4% fall recorded for 2014. No vessels in the bulker category paid more for their insurance in 2015 than in 2014. Handysize Bulkers paid considerably less (5.7%) as did Panamax Bulkers (5.3%). Product Tankers and Tankers 5,000 to10,000 dwt were the only vessels in the tanker category to pay more for their insurance in 2015 than in the previous year, to the tune of 1.3% and 0.6% respectively. The biggest increase in insurance costs, however, was the 2.6% recorded by LPG carriers in the 10,000 to 40,000 cbm range. Perversely, gas carriers are historically regarded as among the safest vessels afloat, perhaps reflecting the effect on premium levels of the cost of potential claims rather than the legacy of claims records.

Richard Greiner, Moore Stephens Partner, Shipping & Transport, says: “This is the fourth successive year-on-year reduction in overall ship operating costs. The reduction is three times that recorded 12 months ago, and a reduction at this level had not been widely anticipated. The fall in operating costs is likely to be due in part to continuing good husbandry in a difficult operating environment for many, and partly to an extremely difficult market and wider economic climate.

“The biggest cost reductions were predictably those in the Stores and Repairs and Maintenance categories. Falling world oil prices continued to have a knock-on effect on lube oil costs in 2015, while increasing numbers of owners were looking to strategic short-term lay-up rather than spending on maintenance and repair.

“The fall in crew costs arguably came as more of a surprise to an industry which has over the years absorbed increases of this type in excess of 20% and lived to tell the tale, but it was doubtless largely a consequence of reduced levels of trading. The fall in insurance costs, meanwhile, will come as no surprise to anybody in the light of warnings from the London market that hull rates for many major fleets continue to reach new lows.

“Last year was a particularly difficult one for shipping. Confidence reached its lowest level for seven years, according to the Moore Shipping Confidence Survey. Operators were not overly optimistic about making new investments in the short-term, while finance costs were predicted to rise. Nobody was expecting good news on dry bulk freight rates, and the outlook for tanker and container ship earnings was little better. The Baltic Dry Index, meanwhile, was getting ready to plumb the depths. It was not an auspicious time to be planning new ventures; rather, it was a time for taking stock. In short, for many, it was a time for keeping operating costs to a minimum.

“Against a background of declining confidence in 2015, oil prices were on a steady downward trend, and the slowdown in the Chinese economy was becoming increasingly evident. Neither of these factors was wholly good news for shipping and both, in different ways, served as a brake on 2015 operating costs.

“A fall in operating costs is good news for shipping, particularly at a time when earnings from the freight market, for many, are so disappointing. But the portents are not so encouraging. Oil prices are predicted to start recovering significantly in the second half of 2017, while the price of steel, the bedrock of the shipbuilding industry, could increase much sooner. The cost of manpower, meanwhile, is only likely to move in an upward direction under the terms of the Maritime Labour Convention 2006.

“While the Ballast Water Management Convention still seemed a long way away from entering into force in 2015, it wasn’t! Now the convention has been ratified, the cost of trying to achieve compliance should become clearer over the next 12 months, as should the cost of making shipping safer and more secure against threats from the likes of cyber-attacks and fraud.

“In conclusion, shipping can draw some comfort from a fourth successive annual fall in operating costs. But it should remember that costs can move both ways. OpCost records that, at year-end 2001, for example, the average daily operating cost for a Handymax Bulk Carrier was US$3,578. In 2015, it was US$ 5,604. For a Suezmax Tanker, the comparable figures are US$4,916 and US$9,170.

“The indications from the freight markets are that shipping is still selling itself too cheaply. Inflationary pressures on operating costs will remain, so maintaining the status quo will not be a viable option. For many, the freight markets will remain challenging and so to remain competitive, shipowners need to continue to improve efficiency, innovate with new technology and harness the considerable benefits of ‘big’ data without delay.”

Bone fide journalists can request an electronic copy of OpCost 2016 by emailing chris@merlinco.com

OpCost, the Moore Stephens vessel operating cost benchmarking study, is now in its 16th year of publication. The 2016 edition is available online, on a new website, providing optimum reporting functionality and tools, creating an easier experience for users, wherever they may be. 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. Access to OpCost 2016 is available free to owners who submit their data for inclusion, or can be purchased by contacting Richard Greiner at Moore Stephens.

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 657 offices of independent member firms in 106 countries, employing 27,613 people and generating revenues in 2015 of $2.7 billion. www.moorestephens.co.uk

For more information:
Richard Greiner
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
richard.greiner@moorestephens.com

Liberia trials class and statutory e-certificates on ClassNK ships

The Liberian Registry has further strengthened its industry-leading reputation for technological innovation by launching operational trials for electronic certificates covering both statutory and class regulations.

Having initiated the practice of issuing electronic statutory certificates such as Minimum Safe Manning, Civil Liability Convention and Registration Certificates for several years, the Liberian Registry has now started trials on ships classed by Japanese classification society ClassNK for the statutory certificates that it issues on behalf of Liberia.‎ The new e-certificates will have a two-fold benefit for owners and operators. They will significantly reduce the administrative burden associated with handling and managing traditional paper certificates, while facilitating the onboard retrieval of certificated data.

The Liberian Registry began issuing electronic certificates in respect of regulatory compliance in a format developed in accordance with the updated Guidelines for the Use of Electronic Certificates issued by the IMO. Once again, it provided an industry lead in this respect, as it has done now with the extension of the e-certificate initiative to include class requirements.

Scott Bergeron, CEO of the Liberian International Ship & Corporate Registry (LISCR), the US-based manager of the Liberian Registry, says, “Liberia’s intention is always to make regulatory compliance easier and more cost-effective for shipowners and operators. Look at what we have been doing for years in terms of harmonizing ISM and ISPS audits, for example.

“Starting to move towards a system based on the use of e-certificates which can be verified online is the logical next step in the technological transformation of ship registration, and indeed of shipping generally. It will also help to reduce the incidence of fraud and manipulated data. Gone are the days when certain ship registers could allegedly operate successfully out of a back office with little more than a telephone and a fax machine. By contrast, the Liberian Registry’s industry-leading position is based on investment in technology and highly qualified, experienced staff, enabling shipowners and operators to meet their commercial and regulatory obligations.”

“We are delighted that ClassNK chose to co-operate with Liberia in trialing this important initiative embracing both statutory and class requirements on Liberian-flag ships.”

The Liberian Registry has long been considered the world’s most technologically advanced maritime administration. It has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment.

www.liscr.com

Liberia Registry makes key appointments in UK, Panama, US and Turkey

The Liberian Registry has announced strategic new appointments in a number of the key areas within the global network of offices operated by its US-based manager, the Liberian International Ship & Corporate Registry (LISCR).

Gerard Kenny has been appointed Technical Manager of the Liberian Registry’s London office, where he will primarily serve as a technical advisor to the Liberian delegations to the IMO. A former technical manager and class surveyor with Lloyd’s Register in London and DNV in Sydney, Gerard was most recently Chief Marine Surveyor with the Virgin Islands Shipping Registry.

Rafael Cigarruista has been appointed Manager of the Registry’s regional office in Panama which, in common with other flags, Liberia established to provide direct services to ships transiting the Panama Canal. Rafael is a former independent nautical engineer with extensive experience of class and statutory surveys.

Pinar Saglam has been appointed Corporate & Registrations Co-ordinator for the Liberian Registry’s office in Istanbul. Previously a Financial Planner with Furtrans Shipping Group, Pinar will be closely involved in daily operations and will also serve as a Special Agent for the Registry.

In the US, meanwhile, Josiah Toepfer has been appointed Manager, Vessel & Company Compliance in the Liberian Registry’s main headquarters office, located in Virginia. His role will be to ensure compliance with Port State Control regulations, and to minimise deficiencies and detentions. A former USCG PSC inspector, Josiah joins the Registry from Sparrow Marine, a shipping audit and consulting company which he founded.

Also in the US, Kevin Smith has been appointed Manager for Vessel Compliance in the Liberian Registry’s Houston office. Kevin, who was previously Regulatory Compliance Manager with Noble Drilling Services, will oversee the regulatory compliance of vessels and managers operating in the Gulf of Mexico.

LISCR CEO Scott Bergeron says, “As the Liberian Registry grows from strength to strength, it is essential for us to ensure that we are able to maintain our ability to provide a high level of service regardless of fleet size. The real assets of the Registry are its people. That is why we are committed to enlisting the services of skilfully qualified personnel, who can bring added value to the Registry’s clients, providing expertise and advice when and where it is needed.”


For photos of other LISCR appointees, please email chris@merlinco.com


The Liberian Registry has long been considered the world’s most technologically advanced maritime administration. It has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment.

www.liscr.com

London P&I Club reports shortfalls on mooring station procedures

THE London P&I Club says its inspectors continue to note negative findings in and around ship mooring stations. The most common findings are a lack of anti-skid deck paint in key areas, a lack of hazard marking of protruding objects and platforms, and low awareness of the dangers of snap-back zones.

The club recommends that ships’ officers conduct a risk assessment of their mooring stations to establish the best location for anti-skid areas, and the use of a prescribed additive to the deck paint, which can usually be found in the ship’s coating technical file. Good surface preparation is essential to a long life, says the club, as it is believed that 70 per cent of premature coating breakdown on ships is attributable to poor surface preparation.

The club emphasises that hazard markings make trip hazards more visible, and says officers should also not overlook dangers at head height when conducting a risk assessment of a mooring station.

Poor awareness of snap-back zones, meanwhile, continues to feature as a regular negative finding on club inspections. Inspectors appointed by the club are required to determine as part of an inspection questionnaire the awareness of ships’ crews who are involved in mooring operations. The intention is for the inspectors to speak directly to crews when making their assessment.

London Club Loss Prevention Manager Carl Durow says, “The club is always pleased to note occasions where the Best Practices section of the questionnaire records that ships’ crews are engaged in ‘toolbox’ meetings prior to operations, and crew are encouraged to consider each individual mooring operation - and specifically the planned mooring arrangement - in good time.

“Also, the latest (2015) edition of the Code of Safe Working Practices for Merchant Seaman makes clear reference to a particular industry-wide confusion over the area of snap-back zones being marked on the deck. It states, ‘The painting of snap-back zones on mooring decks should be avoided because they may give a false sense of security’.”

www.londonpandi.com