port & shipping news 15/15

1 Port & Shipping News 15/15 (06 – 12 Apr 2015)

Uwe Breitling - Port, Transport & Training Consultant [email protected]

Port & Shipping News 15/15 06 – 12 Apr 2015

Where all Silk Roads lead ........................................................................... 4

Australia’s Great Barrier Reef: Judgment day............................................. 6

The EU MRV regulation for CO2 emissions from shipping: When,

where, who, what, why? ............................................................................ 7

Philippines: Government invites bids for development of Davao

Sasa port .................................................................................................. 11

Mexico: US$3.2 billion investment into Gulf coast ports .......................... 12

The future of shipping and trade in Arctic waters ..................................... 13

Researcher creates software that locates real-time leaks in

water, oil or gas pipes .............................................................................. 17

Teekay’s first ‘Unit for Maintenance and Safety’ vessel en route

to Brazil .................................................................................................... 19

Brazil: Santos suspends Ultracargo operations after week-long fire ........ 20

Emission Control Areas: Strong compliance in the first few months? ....... 20

Hong Kong to ban discharge of additional ship-sourced garbage ............. 21

Sri Lanka: Colombo Port City Project criticised at People’s Tribunal;

resumption doubtful ................................................................................. 22

Greece: China seeks gateway to Europe with Port of Piraeus ................... 23

Papua New Guinea: MV Rabaul Queen owner faces trial .......................... 28

Mediterranean: New sea rescue mission aims to help curb migrant

death toll .................................................................................................. 30

Yemen: Shipping lines scale back or suspend port calls as conflict

escalates .................................................................................................. 31

mailto:[email protected]



China: Maritime Safety Administration launches study on impact

of mega containerships ............................................................................ 33

Brazil: Santos Port unable to export 400,000 tons soy ............................. 34

G6 alliance members hit choppy water as they struggle to find

trade lane synergies ................................................................................. 35

Infographic: Oil tanker casualties ............................................................ 36

China: Chemical plant explosion forces ships to evacuate Gulei Port ....... 37

U.S. / Canada: Icebreakers working to release 15 commercial

ships stuck in ice on Lake Superior ........................................................... 37

Jamaica: New operator of Kingston Container Terminal to invest

US$600 million in upgrading and expansion ............................................ 38

Shipping and sea freight: Facing reality ................................................... 39

Merger and acquisition activity in the transport and logistics

sector set to surge .................................................................................... 44

New E-Containerlock tipped to save billions ............................................ 45

U.S.: Seattle and Tacoma miss port alliance deadline ............................... 46

Royal Dutch Shell to buy BG Group for nearly $70 billion ......................... 47

The world’s largest oil companies are about to start devouring

each other ................................................................................................ 48

Panama: Corruption complaint filed concerning irregularities in

licensing of ship officers ........................................................................... 49

Netherlands: Rotterdam in Maasvlakte Plaza plan ................................... 50

Mega ships get fatter but not much longer, limiting cranes alongside ..... 51

U.S.: Ship management company fined $283,500 for breach of

emissions regulations ............................................................................... 52

U.S.: Shell seeks to remove Greenpeace activists from drilling rig ........... 53

Iraq seeks investors for $6.5 billion Grand Faw port project .................... 54




Canada / U.S.: Frustrated tar sands industry looks for Arctic

export route ............................................................................................. 55

Benin and Niger finalise terms of Bollore’s 1 billion euro rail link............. 59

Hong Kong: OOCL orders six 21,000 TEU vessels ..................................... 60

China: Cosco to order at least ten 19,000-teu containerships .................. 61

Ballast Water Management Convention: 'Certainty, challenges,

cost and confusion'................................................................................... 61

FedEx to buy TNT for $4.8 billion to take on rivals in Europe ................... 63

Italian coastguard and navy rescue 1,500 migrants off Libyan coast ....... 64

Plastic polluting oceans kills sea life, becomes part of marine ecology .... 65

Greenpeace activists board Shell Arctic offshore drilling rig..................... 67

Pakistan: LNG import terminal opened in Port Qasim............................... 69

U.S.: Million barrels of crude oil shipped by rail per day ........................... 70

Costa Rica: Terminal de Contenedores de Moín inicia con obras

por $663 millones..................................................................................... 71

Canada: East coast ports target rising container business ....................... 73




Where all Silk Roads lead

11/04/2015

Through a fog of hazy slogans, the contours of China’s vision for Asia emerge

NOT content with both purifying the Chinese Communist Party which he heads and with

reforming his country, China’s president, Xi Jinping, also wants to reshape the economic and

political order in Asia. With the flair that Chinese leaders share for pithy but rather

bewildering encapsulations, his vision for the continent is summed up in official jargon as

“One Belt, One Road”. As Mr Xi describes it, most recently last month at the Boao Forum,

China’s tropical-beach imitation of Davos’s ski slopes, the belt-road concept will “answer the

call of our time for regional and global co-operation”. Not everybody is convinced. Some see

it as no more than an empty slogan; others as a thinly disguised Chinese plot to supplant

America as Asia’s predominant power. Both criticisms seem misplaced. Mr Xi is serious about

the idea. And it is less a “plot” than a public manifesto.

Mr Xi first floated the idea in 2013, in Kazakhstan. He mooted a “a Silk Road economic belt”

of improved infrastructure along the main strands of what, centuries ago, was the network

of overland routes used by silk traders and others to carry merchandise to and from China

through Central Asia and Russia to northern Europe and Venice on the Adriatic. In

Indonesia, Mr Xi proposed “a 21st-century maritime Silk Road”, reaching Europe by sea from

cities on China’s south-eastern seaboard via Vietnam, Indonesia itself, India, Sri Lanka, east

Africa and the Suez Canal. At the time, the proposals sounded rather fluffy—the sort of thing

travelling leaders often trot out, harking back to a distant past of supposedly harmonious

exchanges.

In the past few months, however, the idea has been given a real push. China has gone

further toward putting its money where Mr Xi’s mouth is. It has promised $50 billion to its

new Asian Infrastructure Investment Bank, which despite American opposition has sparked a

race in which 47 countries have applied to join as founding shareholders. China has

earmarked a further $40 billion for a “Silk Road fund”, to invest in infrastructure along the

land belt and the maritime road. One motive for this splurge is self-interest. Chinese firms

hope to win many of the engineering projects—roads, railways, ports and pipelines—that the

new “connectivity” will demand. Improved transport links will benefit Chinese exporters. And

helping its neighbours’ development will create new markets. That China seems to have

realised this has led to comparisons with the Marshall Plan, America’s aid to help western

Europe rebuild after the second world war.

China does not like that analogy, since it sees the Marshall Plan as part of America’s

containment of the Soviet Union. It insists that its initiatives are for the benefit of all of

humanity and are—favourite catchphrase—“win-win”. But it certainly hopes money and

investment can win friends. Yan Xuetong, a prominent Chinese international-relations

expert, has argued that the country needs to “purchase” friendly relationships with its

neighbours.




In Central Asia, battered by low oil prices and plummeting remittances from migrant workers

in Russia, the prospect of greater Chinese involvement is welcomed. Russia itself, though

wary of China’s steady erosion of its influence in the former Soviet states of the region, is

now too dependent on Chinese goodwill to do other than cheer. On the maritime route,

however, suspicion of Chinese intentions is rife. Its arrogant behaviour in the South China

Sea, where it is engaged in a construction spree to turn disputed rocks into disputed islands,

has given the impression that it feels it can simply bully its smaller neighbours.

So the initial reaction in South-East Asia to the belt and road has been sceptical. In

Malaysia, where the government’s usual response to a proposal from China is to applaud

first and ask questions later, the defence minister, Hishamuddin Hussein, has said the

maritime Silk Road has “raised questions” and that it must come across as a joint (that is,

regional) initiative, rather than as a solely Chinese one. Indonesia’s president, Joko Widodo,

who says he wants to turn his country into a “global maritime fulcrum”, was doubtful at first.

But he now seems inclined to help—unsurprisingly since his own plan involves massive

investment in ports and other infrastructure to which, he hopes, China will contribute. A visit

to China last month yielded a joint statement promising a “maritime partnership” and

describing his and Mr Xi’s visions as “complementary”. But Mr Joko had also made clear

before arriving in Beijing that Indonesia did not accept China’s territorial claims in South-

East Asian waters.

In India, another new leader, Narendra Modi, the prime minister, has his own approach to

these issues. He visited Sri Lanka, Mauritius and the Seychelles last month, three Indian

Ocean countries to which he promised greater co-operation and spelled out India’s own

interests as a maritime power. This was not presented as a riposte to China’s plans. But in

January Mr Modi and Barack Obama produced a joint “strategic vision”. Implicitly, India’s

response to China’s maritime ambitions has been to reinvigorate ties with small neighbours

and to cleave closer to America.

China as number one?

Mr Modi, who will be in China next month, is unlikely to be critical of the maritime Silk Road.

Like Mr Joko, he would welcome Chinese investment in infrastructure. But both of them

probably have doubts about Mr Xi’s vision of Asia’s future—of a region with China as its hub,

with Chinese-led institutions playing an ever bigger role in Asian economies, and with a fast-

growing Chinese navy deploying ever more visibly far from China’s shores. Mr Xi, it appears,

is guided by a dream of regional hegemony, of countries such as South Korea and Japan

drifting of their own will away from America’s strategic orbit and into that of China, the

resurgent power reclaiming what it regards as its historical birthright. This is not a plot. It is

a long-term—and even credible—plan, albeit one that does little to inspire the rest of Asia

[The Economist]




Australia’s Great Barrier Reef: Judgment day

11/04/2015

Australia prepares for a UN ruling on its care of a natural treasure

THE turquoise waters around Lady Elliot Island, a speck on the southern edge of the Great

Barrier Reef, look pristine. Coral, turtles, manta rays and brightly-coloured fish thrive. They

are lucky. Formed from a cay of ancient coral, the island sits about 80km from the

Australian state of Queensland: just far enough into the Pacific Ocean to avoid being

affected by human activities that have helped bring the reef to a crisis.

UNESCO named it a World Heritage Site in 1981. Nowhere else, the organisation says,

contains biodiversity to match its 400 types of coral, 1,500 fish species and myriad other

forms of ocean life. But in June it will decide whether to add it to the short list of world

heritage sites—just 46 out of 1,007—it regards as in danger.

In the past 30 years half the reef’s coral

has disappeared. Marine scientists say

people are largely responsible for its

decline. Rising sea temperatures and

acidification, both linked to global

warming; and nutrients and pesticides

washed from farms into its waters, help

to feed coral-eating crown-of-thorns

starfish (see box). The effect on coral

skeletons, says John Gunn of the

Australian Institute of Marine Science, is

similar to that of osteoporosis in

humans.

Cyclones have added to the stress. They

lashed the reef long before Captain

Cook’s ship, the Endeavour, snagged on

its coral in 1770, 18 years before

Europeans settled Australia. But the reef

always proved resilient enough to

recover. In the past ten years, though, six cyclones of Category 5, the highest level, have

struck it. The previous one of such intensity in the area was in 1918.

Each has damaged coral and polluted the surrounding water with run-off from farms and

cities. Between them the reef has had little time to recover. For Russell Reichelt of the Great

Barrier Reef Marine Park Authority, a federal body charged with protecting it, the “burning

question” is whether this is climate change in action.




An Australian government report to the UN in January said that protecting the reef would

take a “concerted international effort” to reduce climate change. But the country’s own foot-

dragging on climate action makes it a poor advocate. Tony Abbott, the prime minister,

pronounced coal “good for humanity” last October when he opened a new mine in a

Queensland coal-mining region inland from the reef; Queensland is one of the world’s

biggest coal exporters. The remark bolstered his reputation as a climate-change sceptic.

It was a boom in resource exports that prompted the World Heritage Committee to put

Australia on notice of the possible change to the Great Barrier Reef’s status four years ago.

Dredging waste at Gladstone, a southern reef port, was being dumped in waters within the

world heritage site to allow some of the world’s biggest exploration companies to start

exporting liquefied natural gas. A bigger row followed over dredging at Abbot Point, another

reef port, linked to coal projects by Adani and GVK, two Indian companies. In late 2013, the

government approved a plan to dump about 3m cubic metres of that port’s waste inside the

reef’s waters.

Public outcry forced a rethink. On March 21st Mr Abbott flew to Hamilton Island on the reef

to launch Australia’s final pitch to the UN to keep it off the danger list. Together with the

Queensland state government, his administration will spend about A$2 billion ($1.6 billion)

over the next ten years to sustain the reef. Dumping dredge waste from port expansions in

reef waters has now been banned.

An “in danger” listing could hit tourism to the reef, which is worth about A$5 billion a year—

to say nothing of the country’s self-esteem. Australians consider the reef to be a national

icon. There are signs of hope. Australia’s marine science institute has tracked coral re-

growing in several places where environmental pressure has eased, says Mr Gunn. Restoring

the whole reef to Lady Elliot Island’s immaculate state will be a bigger challenge.

[The Economist]

The EU MRV regulation for CO2 emissions from shipping: When,

where, who, what, why?

10/04/2015

In late 2014, the Council of the European Union (EU) reached a political

agreement on regulations that set out new EU-wide rules for monitoring,

reporting and verification (MRV) of carbon dioxide (CO2) emissions from

maritime transport.

In this week's spotlight, Fathom take a look at the EU MRV regulation and the final formal

adoption which will follow the legal linguists’ verification of the agreed text this spring. Once

formally adopted, the MRV regulation will enter into force on 1 July 2015.




What is the EU MRV?

Even though there are estimates for the amount of CO2 emissions that are attributable to

maritime transport, the exact amount is currently unknown. Thus, one of the fundamental

purposes of the EU MRV regulation is to provide reliable data on the CO2 emissions

produced by ships. This accurate data will then make it possible to analyse emission trends

and assess ships’ performance – a prerequisite for the introduction of any further energy

efficiency measures or CO2 reduction measures.

The EU MRV regulation is only the first step of a larger EU strategy to reduce CO2 emissions

from maritime transport. The two consecutive steps will be to establish an agreed global

energy efficiency standard as part of the regulation and to identify whether the efficiency

standards are achieving the EU’s desired absolute CO2 emissions reductions and what else

should be done.

According to the European Commission (EC), the EU MRV is also a contribution to the

international negotiations on the establishment of a global monitoring, reporting and

verification system which are taking place at the International Maritime Organization. In the

event that an international agreement to reduce greenhouse gas emissions from shipping is

reached, the EC will have to review the scheme to align it with that international agreement.

To whom does the MRV regulation apply?

The EU MRV regulation will apply to all ships above 5,000 gross tonnage regardless of their

flags (with a few exceptions).

CO2 emissions and energy efficiency will need to be monitored for:

All intra-EU Union voyages (i.e. those between ports under the jurisdiction of an EU

Member State);

All incoming voyages from the last non-EU port to the first EU port of call;

All outgoing voyages from an EU port to the next non-EU port of call.

Emissions from ships within ports will also need to be monitored, reported and verified. This

is intended to encourage the use of available shore-based emission-reduction technologies.

The regulation exempts warships, naval auxiliaries, fish catching or processing ships,

wooden ships of a primitive build, ships not propelled by mechanical means and government

ships used for non-commercial purposes.

‘M’ is for monitoring

Under the EU MRV, data will have to be monitored both on a per-voyage and yearly basis

for all voyages conducted into, out of and between EU ports. Again, the regulation provides

for an exception: ships that undertake more than 300 voyages within the reporting period or




if all their voyages during the reporting period either start or end at a port under the

jurisdiction of a Member State do not have to monitor this information on a per-voyage

basis, but only on a yearly basis.

The different requirements for per-voyage and yearly monitoring are outlined in the table

below.

The monitoring of CO2 will

include emission sources onboard

such as main engines, auxiliary

engines, gas turbines, boilers and

inert gas generators but the

precise scope of these sources

still needs to be specified. CO2

emissions will either be calculated

by multiplying the actual fuel

consumption data of the ship and

the appropriate emission factor

for the fuel type used, or by direct

emissions monitoring.

For monitoring fuel consumption,

companies (‘DOC holders’) may

select one out of four methods.

These four options are bunker

fuel delivery notes, bunker fuel

tank monitoring, flow meters for

applicable combustion processes

or direct emission measurements. The regulation also permits the use of a combination of

these methods if it improves the accuracy of the CO2 emission measurement for a given

combustion source.

The choice between these four options is intended to allow owners and operators to make

use of any existing systems they already have in place without the need to invest in new

monitoring equipment.

‘R’ is for reporting

Ship owners and operators to whom the EU MRV regulation applies must adhere to a

timetable of reporting requirements.

According to this timetable, ship owners or operators must:

By 31 August 2017, submit to an accredited verifier a monitoring plan indicating the

methods chosen to monitor and report emissions.




From 1 January 2018, monitor activity and emissions data for each ship on a per-

voyage and annual basis.

From 2019, by 30 April each year, submit a verified annual emissions report to the

European Commission and the relevant flag State.

From 30 June 2019 onwards, carry onboard a document of compliance issued by an

accredited verifier.

It is not only the ship owners and operators that are under reporting obligations: the EC has

committed itself to publishing an annual report on emissions from maritime transport to

inform the public and to allow for an assessment of the emissions and the energy efficiency

of maritime transport per size, type of ships, activity, amongst other factors.

The EC will also have to assess the maritime sector's overall impact on the global climate

biennially, including through non-CO2-related emissions or effects.

‘V’ is for verification

The key verification requirement in the EU MRV regulation is that both the monitoring plan

and emission report have to be independently verified by an accredited third-party verifier.

This third-party verifier may include classification societies.

If both documents meet the requirements laid out in the MRV regulation and monitoring has

been conducted according to the monitoring plan, the verifier will issue a document of

compliance.

The devil is in the detail

Delegated authorities of the EC can provide additional information and requirements related

to several articles. This means that a number of details are still outstanding and we shall

await how these might look like.

Leading environmental expert Dr Anne-Marie Warris, who has been involved with

Monitoring, Reporting and Verification issues since 2000, commented: “It is challenging that

the EU has chosen to take this step, but positive that they have limited it to MRV. The

regulation may look simple, but the devil is in the minor details and there are many areas

where that minor detail has yet to emerge.”

[Fathom ctech]




Philippines: Government invites bids for development of Davao

Sasa port

10/04/2015

Finally, the Department of Transportation and Communications (DOTC) rolled out

the P17-billion ($381.42-million) modernization and operation and maintenance

(O&M) project of the Davao Sasa port.

In an invitation to prequalify and bid, the DOTC through the Philippine Ports Authority (PPA),

invited interested companies to join the international competitive bidding of the public-

private partnership (PPP) project.

The government has tapped the International Finance Corporation (IFC) of the World Bank

(WB), as well as the Development Bank of the Philippines (DBP), to act as the transaction

advisers for the bidding to be conducted in accordance with the two-stage system, Build-

Operate-Transfer (BOT) Law.

“Bidders are first pre-qualified based on minimum legal, technical, and financial

requirements set by the DOTC and PPA,” the government said. This means only pre-

qualified bidders will be allowed to submit their technical and financial proposals for the

bidding of the country’s first seaport PPP project.

Important access harbor

The port, also known as the Sasa wharf, is being groomed to improve trade access with

other harbors. Situated in Davao City, the port is an important hub in the Brunei-Indonesia-

Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA).

The existing Davao Sasa port sits on an 18.1-hectare property with a container yard size of

4.15 hectares that could accommodate 864 containers. The port has an annual capacity of

550,000 20-foot equivalent units (TEUs).

The PPP project covers the modernization of the existing port and the establishment of a

dedicated container-handling facilities with an initial design capacity of 1,900 container

ground slots to a minimum of 2,700 container ground slots.

The construction of a new apron, development of a linear quay, expansion of back-up area,

provision of container yards and warehouses, as well as the installation of appropriate

container handling equipment are also covered under the PPP project.

The winning bidder would operate and maintain the Davao Sasa port for a period of 30

years.

[Rappler]




Mexico: US$3.2 billion investment into Gulf coast ports

10/04/2015

Mexico is working on a portfolio of nine port projects, all in Gulf coast states, to

increase capacity to meet demand from the energy and mining industries.

Overall, authorities are investing about 48bn pesos (US$3.2bn) in the projects, according to

information on the transport and communications ministry's (SCT) website. The portal does

not provide details on the progress of specific projects.

"It's necessary to prepare Mexican ports for the current reforms such as in energy," Julio

Martínez Hernández, president of the Mexican association of port infrastructure (AMIP) told

BNamericas.

The ports of Matamoros and Altamira are preparing to meet demand from the energy

industry, while the ports of Veracruz, Coatzacoalcos and Dos Bocas are preparing to meet

demand from petrochemical industry, he said.

"Port activity grows about 5% in commercial cargo and 15% in container loading [a year],

so the investment is important," Martínez Hernández added.

"Altamira port is very important, it has the capacity to grow enormously, this port has

40,000ha of land to be used," he said. The expansion of Altamira port will require around

10.7bn pesos and it will become the first port in Latin America with a deep harbor for oil

platforms.

Expansion works in Veracruz port will require about 27.5bn pesos. The authorities are

planning to build a new port with breakwaters, a navigation channel, specialized terminals,

specialized equipment and a new storage area.

At Tuxpan port, also in Veracruz, docks for containers and general cargo will be built. The

authorities are planning to invest 300mn pesos to expand facilities in Laguna de Pajaritos,

Veracruz, to meet petrochemical industry demand.

Seybaplaya port in Campeche state, in the south of Mexico, will satisfy the demand of

national oil company Pemex, Martínez Hernández said, adding around 188mn pesos will be

invested there. Works include the construction of 400m of dock, among other

improvements.

Ciudad del Carmen will require an investment of 1.1bn pesos to modernize the entire port.

Public works involve the construction of 312m of dock, according to local media reports.

Progreso port in Yucatán state is investing 1.6bn pesos to modernize its facilities and build a

new logistics platform.




[BNamericas]

The future of shipping and trade in Arctic waters

10/04/2015

Until recently, international trade and shipping was closed off to the Arctic

because of its harsh climatic conditions. However, in 1922, Arctic explorer

Villjamur Stefansson projected this reality to change.

“We have not come to the northward limits of communal progress. There is no northern

boundary beyond which productive enterprise cannot go until North meets North on the

opposite shores of the Arctic Ocean as East has met West on the Pacific,” he stated. This

dazzling prediction stood up to the common conception of the time that the Arctic was a

place for daredevils and explorers and not for civilized Economic Man.

Yet global warming and accelerating sea ice melting have revived Stefansson’s vision.

Previously restricted resources and waters are now becoming accessible, leaving industries

and governments to look upon the geopolitics of the region with a fresh pair of eyes.

Meanwhile further south, some 80 percent of the world’s industrial production takes place

north of the 30th parallel north, which makes the Arctic Ocean a shortcut between the

world’s most advanced and productive regions. Thus, the Arctic Ocean offers shorter

transport distances, less fuel consumption, less carbon emissions, faster deliveries of goods,




and more profits than what traditional trading routes can provide between ports in the North

Pacific and North Atlantic.

Three shipping passages are available to service trade in the Arctic Ocean: the Northeast

Passage (NEP) running north of Eurasian continent and connecting the Atlantic to the Pacific

Ocean, the Northwest Passage (NWP) passing through the Canadian archipelago between

the Bering and Davies Straits, and the Transpolar Passage (TPP) going through the high

seas of the Central Arctic Ocean.

These Passages (see figure 1) can be used as destination-Arctic routes between harbors

inside and outside of the Arctic, as transit routes between ports in the North Pacific and the

North Atlantic, and as intra-Arctic routes, connecting harbors within the region. Surface

ships already go through all these passages, yet the greater challenge is whether they can

be used in an economically viable manner and in an environmentally sustainable way.

Figure 1: The transportation passages of the Arctic Ocean

The Northeast Passage runs through a series of ice-infested marginal seas linked by some

58 straits going through three archipelagoes above a shallow sea bed (less than 20 meters

in some places). The shallowness of the shelf and straits affects the size, volume and drafts

of ships. The eastern sector of the passage also contains unbreakable multi-year ice from




the Central Arctic Ocean – ice that remain frozen through warmer seasons – which adds to

the challenge of navigation.

However, ice conditions have been changing recently. The Chukchi Sea is ice-free during

periods that have lasted up to three months each year since 1979. While the sailing season

for the entire NEP has been extended from three months to close to six months (see figure

2), the Kara Sea Route has been used for shipping on an annual basis ever since 1978

transporting nickel and oil from Dudinka to Murmansk, Russia.

To extend the navigation season, Soviet authorities invested heavily in procuring the biggest

and most powerful icebreaker fleet in the world, allowing the Russian government to open

41 Arctic ports to service foreign vessels along the passage. Thus, transit sailing increased

from two sailing in 2009, to 34 in 2011 and to 41 in 2014.

The Northwest Passage runs through one of the largest archipelagoes of the world,

comprising 36,000 small areas of dry land above sea level—islets and rocks included—that

are connected through shallow and narrow ice-plagued channels. Sea ice conditions within

the archipelago vary dramatically from year to year, presenting unpredictable conditions for

any surface operations.

Destination shipping, with small ships and barges, comprises the principle form of shipping

activity in these waters, whereas commercial transit shipping rates are more moderate.

From 1903 to 2004, only an average of 1,7 transits a year have been undertaken through

the NWP, and it is likely that these numbers will remain low in the future, mainly because

ports to service transits are close to non-existent.

The Transpolar Passage runs through a part of the Arctic Ocean where the frequency of

multi-year ice is the highest. Contrary to popular belief, the ice cover of the Arctic Ocean is

not a static, unbroken surface. It is constantly in motion, breaking into pieces and building

up pressure ridges above and below the surface when floating sheets of ice grind together.

In the 1960s, open areas constituted five to eight percent of the total area of the Arctic

Ocean during winter, and approximately 15 percent during summer. Of course, they make

up a far higher percentage today thanks to climate change. Over the last thirty years, sea

ice thickness in the Central Arctic Ocean has decreased by 42 percent, or 1,3 meters.

Moreover, model experiments predict an ice-free Arctic Ocean in summer around 2040.

As a consequence, the frequency of maneuverable first year ice will increase. So far, one

hundred nuclear and diesel-powered icebreakers have reached the North Pole, but no

commercial ships have been able to make the trek thus far. Russian sources suggest that

the rapid development of ice-classed vessels and icebreaking technology can make shipping

in these waters feasible in winter from April to May and November to December. If so, the

shipping season can be extended up to 9 or 10 months.




Figure 2: Potential sea routes

Considering navigation conditions, the Norwegian Shipowners’ Association ranked the NEP

as their preferred passage in the short term, the TPP in the medium term, and the NWP in

the long term.

Furthermore, both Arctic states and non-Arctic states like China, South Korea, Singapore,

and India, favor greater economic resource extraction, trading, and shipping in the Arctic.

According to experts, destination shipping connected to resource extraction is the type of

trade likely to expand the most in the years to come, both for the NEP and NWP.

A new partnership including the Duke Corporate Education organization of Duke University,

the Norwegian Veritas GL, and the Norwegian Shipowners’ Association, has organized an

Arctic Leadership Programme for Executives (ALPEX) to prepare executives for the

challenges of the changing Arctic. The program will take place in 2015 and 2016 in Tromsø,

Norway and Helsinki, Finland. The overall purpose of ALPEX is to prepare decision makers

with “a good understanding of the Arctic System in total and how the different sub-systems,

technical, environmental, political, social and legal interact.”




Given the tremendous changes impacting the region, the Arctic is entering a new age of

human interaction and one with a principally industrial future, both in terms of economic

and political priorities.

[World Policy]

Researcher creates software that locates real-time leaks in

water, oil or gas pipes

10/04/2015

Through the laws of physics and application of a mathematical model of fluid

mechanics, it calculates when an irregularity occurs on site.

Often, water, gas or oil distribution networks present leaks in storage tanks, pumping failures or

illegal connections exist. Credit: Image courtesy of Investigación y Desarrollo

Often, water, gas or oil distribution networks present leaks in storage tanks, pumping

failures or illegal connections exist. In order to avoid economic losses due to these causes,

Cristina Verde Rodarte, researcher at the Institute of Engineering, of the Autonomous

National University of Mexico (UNAM), designed a virtual guard that immediately detects

abnormalities in any type of duct.




The software is called VIVIUNAM and performs logical deductions in real time, allowing to

identify the type of failure and get to the root of the problem, thus avoiding a waste of time,

by digging or manually searching for the problem throughout the pipeline, said the

researcher, who is also member of the Academy of Engineering.

The virtual vigilante works with an algorithm, which by the laws of physics and the

application of a mathematical model of fluid mechanics, calculates a series of data indicating

what is the behavior of gas, water or oil pipelines in normal operating conditions. These, in

turn, are compared with the record of pressure measurements within the pipe and the

difference between these measurements indicate the presence of leakage.

When the results from the mathematical model do not match the automatically recorded

measurements an error or an abnormal event is happening, and different scenarios are

sought; for example, the pressure sensor may be disconnected, a leak is present, an illegal

connection or a disturbance that alters the behavior of fluids within the pipeline.

PhD in Electrical Engineering by the University of Duisburg in Germany, Verde Rodarte, said

that the chemical and oil industries, and general processes involving fluid transport systems

should have automatic, safe and efficient monitoring in order to avoid accidents with highly

volatile fluids or pollutants that cause a great impact on the environment, damage society

and the economy. Therefore, her proposal is to place the VIVIUNAM system in control

distribution networks to report the presence of disturbances and implementing adequate

contingency plans.

In various networks, such as the Cutzamala system, pumping plant Xotepingo (Mexico City)

or distribution networks Pemex (Mexican Oil) pipelines have pressure and fluid gauges,

however, the data is only used for administrative purposes, instead of take advantage of

them to look for leaks and correct the problem, said Cristina Verde.

The experimental work where leakage was emulated in a pilot pipeline of 200 meters of

longitude with a diameter of 10.4 inches, was instrumented with pressure and expense

sensors. VIVIUNAM was automatically operated from a laptop and effectiveness of the

algorithms developed by scholars of II-UNAM was proved.

The technology used to diagnose leakage is based on mass balances, measuring expense,

pressure and temperature at the ends of a pipeline without laterals. Calibration for each

model is performed according to the topology and physical properties of the fluid and duct in

question. This technique is economical because it does not require additional sensors to

those already available in distribution pipelines, the software only requires data from the

distribution network for the algorithm to work, finished the university academic.

[Investigación y Desarrollo / ScienceDaily]




Teekay’s first ‘Unit for Maintenance and Safety’ vessel en route

to Brazil

10/04/2015

Arendal Spirit. Photo: Teekay

Arendal Spirit, the first of Teekay’s so-called ‘Unit for Safety and Maintenance’ (UMS)

accommodation vessels, is en route to Brazil aboard a COSCO heavy lift vessel.

The vessel features contains 500 beds in 248 cabins with en-suite bathrooms, daylight

windows, television, internet and telephone connections, lounge areas, coffee shop,

television and game room, fitness room, dining room, office areas, meeting/conference

room and cinema. Its design is base on Sevan Marine’s unique cylindrical hull design,

providing several advantages compared to traditional accommodation vessels including high

uptime, excellent motion characteristics (less seasickness), more deck space, better stability,

and more storage space.

Arendal Spirit is expected to arrive in Brazil by the end of April to start a 3-year charter

contract with Petrobras, with extensions. It is the first of three UMS vessels to be built by

COSCO in China. The vessels were originally ordered by Logitel Offshore Holdings, which

Teekay acquired in July 2014.




Teekay’s second UMS, the Stavanger Spirit, is currently under construction with delivery

scheduled for the fourth quarter of 2015.

[gCaptain]

Brazil: Santos suspends Ultracargo operations after week-long

fire

10/04/2015

The mayor of Santos suspended on Friday operations at a fuel storage tank farm

after a week-long fire at the facility operated by Ultracargo slowed exports from

the country’s largest port.

“With this measure, all the company’s activities in the city are suspended until all legal

requirements are met to ensure the site’s safety,” the mayor’s office said. Ultracargo, a unit

of Brazilian chemical and fuel-distribution company Grupo Ultra, said its facility had always

complied with legal and technical standards and that it would provide any necessary

clarifications to the mayor.

The fire was mostly extinguished by Friday morning, with fire fighters working to cool the

tanks and snuff out flames still forming in the released gas. Authorities blocked an entrance

to the port for cargo trucks near the Ultracargo facility for a fifth day on Friday although

trucks have been able to access the Santos side of the port at night and the other side, in

Guaruja, has been unaffected.

Santos has been unable to export 400,000 tonnes of soybeans and soymeal at a time Brazil

accounts for much of the world’s supplies, soy industry association Abiove told Reuters on

Thursday.

[Reuters]

Emission Control Areas: Strong compliance in the first few

months?

10/04/2015

The following article examines the legal issues arising from the entry into force

on 1 January 2015 of the requirement for 0.1% sulphur in fuel oil within

designated Emission Control Areas (ECAs).

Since 1 January 2015, Annex VI of the International Convention for the Prevention of

Pollution from Ships (MARPOL) has required vessels operating in designated Emission

Control Areas (ECAs) – the Baltic Sea, the North Sea, the English Channel, and the majority

of the coast of the continental USA and Canada – to use fuel oil with a sulphur content no




greater than 0.1%. Have there been any issues in compliance with these emissions

regulations in the first few months of 2015?

In a nutshell, the answer would appear to be "not as many as expected". The Waterways

Police in Hamburg report that there has been a surprisingly high level of compliance.

Perhaps the prospect of up to five years' imprisonment under German law for the illegal

release of emissions, or a fine of up to EUR 50,000 for offences relating to MARPOL Annex

VI, have had the desired deterrent effect.

The US Coast Guard (USCG) has, however, had a somewhat different experience, issuing a

Safety Alert on 3 March 2015 that referred to "several reported incidents involving

substantial machinery space fuel leakages while vessels were switching fuel oil to ensure

compliance" and "many losses of propulsion...in different ports...associated with changeover

processes and procedures".

For those owners and operators who have opted for fuel switching as their method of

compliance with MARPOL Annex VI, it is important to review and amend their procedures for

such switching on entry into ECAs, to prevent the type of teething problem mentioned by

the USCG.

The implications stemming from such teething problems under charterparties and contracts

under bills of lading are significant. In particular, losses of propulsion may expose owners or

time charterers to claims under warranties as to seaworthiness and the condition of the

vessel. Delays caused while fuel leakages or engine breakdowns are resolved, or during

detentions by Port State Control for non-compliance with MARPOL Annex VI, could lead to

arguments that the vessel is off-hire, or that time shall not count against laytime or, if the

vessel is on demurrage, as demurrage.

The risk of these legal consequences materialising could be reduced to some extent by

consulting the manufacturers of the machinery in question to ensure that their guidance for

safe and reliable operation is being followed. In addition, it is worth noting that onboard

inspections by port authorities will typically require sight of engine log books, bridge log

books, the fuel oil changeover procedure (if applicable), bunker delivery notes, the oil record

book, the SECA book and sounding tables, so it is essential that these documents are kept

fully up to date.

[Clyde & Co]

Hong Kong to ban discharge of additional ship-sourced garbage

10/04/2015

Hong Kong will introduce a law to prohibit discharge of additional kinds of

garbage from ships to enhance the prevention of marine pollution in its waters.




The city's legislators will decide on the Regulation on April 15, an official for the Transport

and Housing Bureau of Hong Kong said on 10 April.

The new regulation seeks to enact the latest international requirements governing discharge

of garbage from ships as prescribed by the International Maritime Organization (IMO).

Under the new regulation, control on marine pollution will be enhanced by expanding the

definition of 'garbage' to include nine categories of substances generated during the normal

operation of ships, such as food wastes, operational wastes, cooking oil, fishing gear, and

animal carcasses.

"The discharge requirements under the new regulation will also be tightened by prohibiting

discharge of additional categories of garbage from ships into the sea. This will contribute to

better protection of the marine environment," the official added.

In addition, the new regulation will set out new requirements for ships to display placards to

notify the crew and passengers of the discharge requirements and to maintain garbage

management plans and garbage record books.

The IMO adopted the International Convention for the Prevention of Pollution from Ships

(MARPOL) to stipulate regulations that aim at preventing and minimising pollution from

ships. The requirements governing pollution by garbage are set out in MARPOL Annex V.

The requirements of MARPOL Annex V were implemented in Hong Kong through the

Merchant Shipping (Prevention of Pollution by Garbage) Regulation (Cap.413J) enacted in

1995.

[IHS Maritime 360]

Sri Lanka: Colombo Port City Project criticised at People’s

Tribunal; resumption doubtful

10/04/2015

Environmentalists and members of the general public have panned the

controversial China-funded Colombo Port City Project (CPCP) as one that has

caused adverse environmental impact in many parts of the country, and that, in

fact, was wrongly launched before a proper environmental impact assessment

study had been carried out.

These opinions were expressed during a People’s Tribunal that was held before a panel of

judges on Thursday at the Colombo Public Library by Transparency International Sri Lanka

(TISL) to ascertain the “reality and truth” behind the fate of the $1.4bn project, being

constructed by ‘Fortune 500’ company China Construction Communication Co (CCCC).




Environment Conservation Trust director Sajeewa Chamikara asserted that there were

serious lapses and shortcomings in CPCP’s Environment Assessment Report (EAR) prepared

by the University of Moratuwa, on the strength of which approval was granted to the

project.

“No maritime biologists and maritime archaeologists were included in the team that was

entrusted with the task of preparing the EAR of the project,” Chamikara said. “Nor was the

report kept open for public dialogue.

“Many areas in the country have been experiencing adverse environmental impact due to

CPCP. We also do not have any assessment of the archaeological damage caused in the sea

area reclaimed under this project. The Department of Coast Conservation should be held

responsible for giving approval for this project.”

The criticism heaped on CPCP, which had been was suspended on March 6 this year, could

jeopardise its resumption promised by President Maithripala Sirisena to the Chinese

government.

[Splash 24/7]

Greece: China seeks gateway to Europe with Port of Piraeus

09/04/2015

A Chinese executive with shipping company Cosco has helped transform part of

Athen's Port of Piraeus into a success story. The multinational firm now has a

controversial plan to acquire the whole facility and put it on track to join the

ranks of Hamburg and Rotterdam.

One could argue that China's long path to Piraeus, Greece, began on April 27, 1961. It's the

day Mao Zedong founded the communist state's first freight company, the China Ocean

Shipping Company (COSCO). The Great Leap Forward, Mao's plan for industrialization, had

proven to be a disaster at the time, leaving millions dead or starving. With Cosco, China had

its eyes on overseas markets.

Almost 54 years later, the company is steering toward a major prize in Greece. After lengthy

wavering, the Greek government -- comprised of Prime Minister Alexis Tsipras, his far-left

Syriza party and the right-wing populist Independent Greeks -- has announced it will be

selling the majority of its share in Athens' Piraeus Port Authority. So far, Cosco is the most

promising bidder.

Throughout, Fu Cheng Qui, or "Captain Fu," as the chief executive of Cosco's Piraeus

subsidiary is called by those who know him, will be closely monitoring the bidding process.

Fu has already been in Piraeus for a long time with the company, and he is determined to

stay. He has placed the bid on behalf of his company and has little doubt it will be accepted.




In his position, 65-year-old Fu is the guardian of China's gateway to Europe. He may soon

control the container piers, cruise-ship terminals and ferry quays of Greece's biggest port.

"The government has changed four times since I have been in Greece," Fu says. "They all

always talk a lot. But what counts? Actions count. Actions! Only actions!"

On the way to the cargo port, a small sign indicates a fork in the road -- with one route

leading to OLP and the other to PCT. Each to a different world. Pier I belongs to the

primarily Greek state-owned OLP port authority. These days, though, most trucks take the

other route, to PCT, to pier II and pier III, which is run by Piraeus Container Terminal, a

subsidiary of Cosco.

"Just look," Fu says as he steps up to the window. Then the show begins. On Pier II, 11

container gantry cranes are in constant, powerful movement. All are new and made in

China. Trucks move across the ground at an interval of only minutes.

Two worlds side by side

A few hundred meters away, on Pier I, the dock is vacant, no ship has arrived.

So far, the Greeks and the Chinese have shared processing responsibilities for the containers

of MSC, the large shipping company. But business has collapsed. Since MSC and Maersk, the

two market leaders, began their 2M Alliance in January, all of the company's containers are

loaded by Cosco on Pier II. "The largest ships happen to be very large," says Fu. "And we

are simply twice as fast. We can now complete 36 container movements per hour, and time

is money. Look, Pier I is almost empty. That's very sad."

Piraeus Container Terminal. Image: Greek Reporter




In 2008, Cosco took over the license to operate Pier II for 30 years at a cost of €490 million

($532 million). They were later given another five years, as well as permission to build a

third terminal.

Former Greek Shipping Minister Miltiadis Varvitsiotis claimed that the partial privatization of

the Athens port had "turned out to be one of the most important and profitable investments

of the past few years."

In the span of four years, Cosco has quadrupled container traffic, to just under 3 million

units a year. If all goes well, annual capacity will be expanded to 6.2 million containers in

2016. Together with Pier I, that would put it in the same league as Europe's largest ports in

Hamburg, Antwerp and Rotterdam.

The former state-owned terminal -- where harbor unions formerly ruled and ancient diesel-

powered pallet trucks once drove around -- has been turned into a highly profitable

business.

Piraeus has become the story of two worlds -- that of the turbo capitalism of the successors

to Mao Zedong on the one side, and a market economy that can move as slowly as a

Socialist one on the other. Some people see the port as a symbol of the country's future. It's

an image that is a horrific one for many, including a large portion of Syriza voters.

'Cosco go home'

Fu has decorated his office, which is located high above the piers, in the spirit of friendship

between the people. There are olive branches and peonies, a terracotta warrior and a

Poseidon statue as well as models of the Parthenon and the Imperial Palace, all placed

harmoniously, side by side. "We are two old cultures," he says. "We have a good

relationship with Pier I. We aren't enemies. I have a ship master's certificate, and I know

that if a ship sails too fast, its mast breaks."

When Fu wanted to take over Pier II in October 2009, he was welcomed to Athens by a

banner emblazoned with the words "Cosco Go Home!" The Dockworkers' Union claimed that

the port was going to be taken away from the Greek people and went on a six-week strike.

Some of the protesters from the time are now part of the government.

Fu was himself once a member of the Red Guard. During the Cultural Revolution, back in

the 1960s, he "of course" brandished the Little Red Book: "Long live Chairman Mao! Long,

long live." He can still recite it quite well.

The manager is no stranger to these kinds of protests. "You know, I worked for 15 years in

Naples, and know what strikes are. I am a Socialist," says Fu. Does he find that word funny

now? No, he says, "I can understand the workers completely. But unfortunately the workers

didn't understand us at first."




Fu claims everybody thought he would bring in his own longshoremen, pilots and fitters

from China. "I told them, no, this is your company. We are only coming with seven

managers." All construction contracts went to Greek companies, he says. "In five years,

Cosco hasn't sent a single euro back to China. Everything is being invested! New loading

bridges, electric jacking systems!"

At the time, Cosco had bid far higher than market value. Every year, the company transfers

approximately €30 million to the Greeks. The Athenian port authority earns more from the

concession fee than from its own freight business. With the completion of the 19-meter-

deep (62-foot-deep) deep-water port at Pier III, and the modernization of the crane system,

Cosco will have invested half a billion euros.

China's foothold in Europe

But China is thinking far into the future. Piraeus is the closest port in the northern

Mediterranean to the Suez Canal. From here, it can conquer the EU domestic market.

Recently, three freight trains began leaving the port each week. "Those are peanuts, of

course," Fu says. "But it's only the beginning."

When Chinese Prime Minister Li Keqiang visited the port in June, Piraeus was described as

China's gateway to Europe: China's exports could reach Germany, Hungary and Austria

"between seven and 11 days" faster, he said. Huawei, the electronics conglomerate, has

already opened a logistics center right at the port.

Fu says it wouldn't be a major disaster for the company if Greece were to leave the euro

zone. "We are part of the CKYHE shipping alliance," he explains. "We have holdings in ports

in Genoa and Port Said, inside and outside of the euro zone." A Grexit would largely pose an

accounting problem -- at least initially.

Currently, around 1,200 Greeks work for Cosco. The company doesn't need to pay union

wages, there is no corporate training and the crane-operations staff has been reduced.

Jobs are now awarded by an agency instead of the unions. A port worker earns about

€1,200 per month, which is above average for Greece, but only one-third of what wages

used to me.

When asked about the unions, Fu describes them as being "superfluous!" "Every employee

is like the member of a family," he says. "Everybody works with respect for the other. We

listen to what our employees say and react to it. The company is like a family. We are all

brothers. Everybody is happy."

That's nice. But the firings, the labor disputes, the claims that employees don't even have

the time to use the bathroom? "Nonsense," Fu says, before returning to the issue of

principles.




"The union leaders promise their members more money for less work," he says. "How is that

supposed to work? If you want a higher salary you first need to work hard. Not lie on the

beach and drink beer. Learn from the Germans! Work hard, never be lazy and always work

seriously. Hard work -- happy life."

Political resistance

That wasn't exactly Syriza's campaign platform. The week before last, Deputy Greek Prime

Minister Giannis Dragasakis traveled to China and declared that his government still wants to

privatize the majority of the Piraeus Port Authority. The bidding process could be complete

within weeks, he said.

But a short while later, Deputy Shipping Minister Theodoros Dritsas contradicted him.

Strategically important property of the state may not be privatized, he said.

"It is difficult to get a clear image. It is all -- political," Fu says, as if spitting out the word.

"We can just wait and drink tea. Or coffee. In any case, I want to have this share," he says.

"In the spirit of friendship between our two countries."

The market value of the Piraeus Port Authority currently stands at about €270 million. The

passenger business and the car ferries to the Greek islands are especially lucrative. With its

18 million passengers, Piraeus is the biggest passenger port in Europe. If it is privatized,

people are expecting a sale price significantly higher than its market value. Tsipras' Syriza

party itself cited a figure of €500 million to its creditors.

Aside from Cosco, which is considered the front runner, port operators from Denmark, the

Philippines, the United States and the United Arab Emirates have expressed interest. If

Cosco prevails, Piraeus would then be completely in Chinese hands.

Of course, back in 2008, Alexis Tsipras stood behind the protesting dock workers, with their

"Cosco Go Home" message. As prime minister, though, he has to do everything he can to

make Fu feel at home.

It's one of the many dilemmas faced by Tsipras. He would like to make himself less

dependent on the European Union by bringing China into Greece as an investor. But the

Chinese in no way share the leftist and radical views of the Syriza government. Instead they

follow Captain Fu's dictum of "Hard work -- happy life." The more China invests, it seems,

the more likely it will become that Greece's social gains start to crumble.

A new monopoly

A few hundred meters from Fu's new world is the office of the Union of Dockworkers,

headed by Nick Georgiou. He looks like a man who's carried a lot of sacks, fought lots of

battles and smoked too many cigarettes. He's also a man who wouldn't describe the

conditions at Pier II as being one big happy family.




Georgiou speaks of work accidents that have been covered up, a lack of emergency

vehicles, neo-Nazi members of the Golden Dawn making themselves at home on the

Chinese side of the pier. But he blames the troika as being the true culprits. "The EU has

wanted to push through the liberalization with the port workers," he says. "Cosco is merely

the means to an end." Since the Chinese began running the port, the wages in the Greek-

run part have gone down as well.

For his part, Georgiou doesn't want to accept that his company, the Piraeus Port Authority,

derived one-third of its income over the past year from rental fees paid by Cosco. He takes a

long drag of his cigarette, before adding, "Piraeus was partly privatized back then in order to

break up a monopoly. Now the rest is also supposed to be sold. Then we'll have a monopoly

again, but a Chinese one."

Just offshore, you can see the southern tip of the Salamina Island in the haze. Fu has

announced that he wants to have a repair yard built there, along several kilometers of

coastline.

The ancient Greek name of the island is Salamis. This is where the biggest naval battle in

Antiquity was fought between Greeks and Persians -- in what would become a central event

in the history of European civilization and for the power relations between the West and the

East.

Back then, the Greeks won.

[Spiegel Online International]

Papua New Guinea: MV Rabaul Queen owner faces trial

09/04/2015

Peter Sharp, the man in the center of Papua New Guinea’s worst maritime

disaster, has been committed to stand trial.

Sharp, the managing director of Rabaul Shipping, and four others had appeared before a

half-empty Kokopo Committal courtroom Thursday to hear of their committal by magistrate

Oakaiva Oiveka.

However, only four of them would stand trial in the National Court over the 2012 tragic

sinking of the overloaded coastal ferry MV Rabaul Queen in rough seas in Morobe Province

waters on its way to Lae, killing 171 people on board.

In the dock with Sharp were Rabaul Queen captain Anthony Tsiau, chief mate Michael Zirau,

former PNG Ports Kimbe branch port manager Grace Amen and National Maritime Safety

Authority Rabaul manager Joseph Titus Kabiu.




MV Rabaul Queen

They were charged with 171 counts of manslaughter and for sending an unseaworthy

vessel out to sea under sections 302 and 331 of the Criminal Code. However, charges

against Kabiu were dropped by the court because of insufficient evidence.

Sharp and the three were committed under Section 95 of the District Court Act after the

court found that the evidence was sufficient to warrant a committal. Oiveka made his ruling

and refused an application by the defence lawyers to strike out the charges of manslaughter

against the defendants due to the ambiguity state of the charges.

A date is yet to be set for the trial.

On the same police file, two people had already been committed for trial in the National

Court in Madang and Kimbe over the tragedy. However, NMSA Kimbe manager Benjamin

Livinai passed way in June last year.

The passenger ferry was carrying about 350 passengers bound for Lae when it sank on

February 2, 2012, and around 171 people, including students and children, perished off the

Finschhafen coast.

The Rabaul Queen investigation team led by Chief Inspector Ben Turi arrested Sharp and six

other people in late 2013. Turi said it has taken a long time for the case to reach this stage.

The Report of the Commission of Inquiry into the Sinking of Rabaul Queen was submitted to

the Prime Minister of Papua Guinea on 28 June 2012.

An unseaworthy and unsafe ship

However, when considering the operation of the ship and the broader

meanings of‘ unseaworthiness’ and ‘unsafe ship’ the Commission considers


http://www.mvrabaulqueen.com/Report/fullreport.pdf



that Rabaul Queen was both unseaworthy and unsafe; and, hence, should

never have departed Kimbe because, among other things:

the ship was not suitable to operate in force 7 or above weather

conditions;

the ship was not manned and operated by a competent and appropriately

qualified crew;

the ship was not maintained in accordance with a considered and

recorded maintenance plan;

the ship was routinely carrying more passengers than specified by its

Survey Certificate;

the crew did not carry out effective safety training drills;

the crew was not provided with appropriate procedures and guidelines in

the form of a safety management system;

the passengers were not mustered and provided with information about

the ship, its life saving equipment and emergency signals after departure;

the ship did not carry lifejackets suitable for use by all of its passengers

(i.e. children and infant lifejackets were not carried);

Rabaul Shipping and the Master did not consider the most appropriate

weather forecast information either before the ship sailed, or during the

voyage;

the Master did not make regular contact with Coastal Radio as required;

and the Master did not check the ship’s stability before departing port.

Source: Report of the Commission of Inquiry into the Sinking of Rabaul Queen

[Pacific Islands News Association / Report of the Commission of Inquiry into the Sinking of

Rabaul Queen]

Mediterranean: New sea rescue mission aims to help curb

migrant death toll

09/04/2015

A new sea rescue operation is to be launched in May to try to reduce the number

of refugees, migrants and asylum seekers killed making the treacherous crossing

from Africa to Europe, medical charity Medecins sans Frontieres (MSF) and

Migrant Offshore Aid Station (MOAS) said on Thursday.

Last year was the deadliest on record when more than 3,400 people died trying to cross the

Mediterranean, MSF said. This year, the death toll is expected to be even higher, MSF

added. There is less help available for boats in distress since the Italian navy’s search and


http://www.mvrabaulqueen.com/Report/fullreport.pdf



rescue operation, Mare Nostrum, closed down in November last year because of a lack of

funds.

Hundreds have already died this year, including 29 migrants who died of hypothermia in

February aboard Italian coast guard vessels after being picked up from a boat adrift near

Libya.

“No one deserves to die, and we will do everything in our power to ensure that those who

feel compelled to undertake this treacherous sea crossing in makeshift vessels do not

drown,” MOAS director Martin Xuereb said.

MOAS, an international organisation devoted to preventing catastrophes at sea, was

founded by entrepreneurs Christopher and Regina Catrambone, and last year rescued some

3,000 people. “Europe has turned its back on people fleeing some of the worst humanitarian

crises of our time,” Arjan Hehenkamp, MSF’s general director said.

The crossings are organised by criminal gangs operating mostly from Libya, who pack

people onto ill-equipped and rickety boats. More than 20,000 people are estimated to have

died in the last two decades, many of them escaping violence or persecution in countries

including Eritrea, Somalia and more recently Syria, according to MOAS.

The joint search, rescue and medical aid operation will run from May to October, when

thousands of people are expected to risk the crossing. Emergency teams will circle the

routes most frequently used by boats making the crossing, waiting to intervene if they spot

trouble.

When the Italian Mare Nostrum mission wound down, the European Commission launched a

much smaller rescue mission off Italy. Dubbed Operation Triton, it will run at least until the

end of 2015.

[Thomson Reuters Foundation]

Yemen: Shipping lines scale back or suspend port calls as

conflict escalates

09/04/2015

International shipping lines are being forced to scale back or suspend port calls

to Yemen as the conflict gets worse, putting pressure on supplies of food as

prices rise in local markets.

Yemen imports more than 90 percent of its food, including most of its wheat and all its rice,

to feed a population of 25 million. Much of its needs had been serviced by foreign ships.




Saudi Arabia and Arab allies have launched air strikes against the Iran-allied Houthi

movement, which has taken most of the country and forced President Abd-Rabbu Mansour

Hadi to flee to Riyadh. The coalition has deployed naval vessels to intercept ships carrying

arms to the rebels, although merchant ships are meant to have free passage.

Most ports appear to be under Houthi control or are disputed by combatants. Many shipping

companies are now unwilling to risk their vessels, industry sources say. “Many of the owners

and container lines are refusing to go to Yemen. You can still call at a number of ports but

the fear factor is growing,” an international commodities trade source involved in Yemen

said.

The world’s largest global shipping association, BIMCO, said: “If a port is taken/held by the

Houthis and a ship is seen to be supplying the rebels, the ship could be at risk from air

strikes or indeed naval action from the coalition.”

Another commodities trader said his vessel carrying wheat was held up for days by coalition

ships before being allowed through into Yemen. The impact is being felt by local people in

the Arab world’s poorest country.

“The price of a 50 kg bag of wheat has risen from 5,000 Yemen rials ($23) to 6,300 rials,”

said Muhammad Saad, 37, from the capital Sanaa, which is under Houthi control. “People

are buying wheat in big quantities because they fear shortages.”

Fahd al-Dhabhani, a government employee from Sanaa added: “We are living a disaster

from all sides. The price of wheat and flour have risen in a big way. There is no more petrol

even on the black market.”

Port calls

The world’s top container group, Maersk Line, said it had suspended all calls to Yemen. The

world’s number 2 ship container line, MSC, said it had taken the decision to divert vessels

bound for Yemen “to alternative, and more secure, ports in the region.”

The world’s third biggest container group, CMA CGM said separately it was not making direct

port calls to Yemen, only booking slots on other vessels that still called at the port of

Hodaida. Others such as Taiwan’s Evergreen Line had also suspended shipping services “to

prevent risk to the Line’s vessels and its customers’ cargoes”.

The processing and distribution of wheat and other staples have already been disrupted. Aid

agencies have warned that Aden faces a humanitarian catastrophe. “The port of Aden is

virtually closed, but for some oil shipments which berthed at Aden Refinery. Dry cargo

shipments have been stopped because no stevedores are available due to armed clashes,”

shipping and logistics agency GAC said.




GAC said other ports such as Saleef, and Hodaida on the Red Sea remained open.

Nevertheless, an explosion at a dairy factory at Hodaida was adding to the risks. In another

blow, Al Qaeda in the Arabian Peninsula captured the eastern port of Mukalla last week.

Container group United Arab Shipping Company said it had suspended all cargo bookings.

Precious Shipping, one of Thailand’s largest dry cargo ship owner, said it would not allow

any of its fleet into Yemeni waters.

At least four oil and natural gas tankers that were headed to Yemen have been diverted due

to the chaos. So far, there have not been any major disruptions to the Bab el-Mandeb

waterway off Yemen through which nearly 4 million barrels of oil are shipped daily to

Europe, the United States and Asia.

Iran sent two warships to the Gulf of Aden this week to protect Iranian shipping. Iran’s

Supreme Leader Ayatollah Ali Khamenei said air strikes by the Saudi-led coalition amounted

to “genocide”.

“Iran’s warships are not likely going to initiate any hostilities, but could serve to run

interference with warships of other navies that might attempt to prevent Houthi rebels

onshore from resupplying,” said Michael Frodl, of U.S. based consultancy C-Level Global

Risks.

[Reuters]

China: Maritime Safety Administration launches study on

impact of mega containerships

09/04/2015

China Maritime Safety Administration (China MSA) has launched a study into the

impact of the increasing size of container ships on the country's container

industry, in a bid to boost its competitiveness.

The first phase of the study would aim to identify the key technology, policies, and

regulations that were relevant to the challenges brought about by the mega-container ships,

Hui Xie, head of the international co-operation department of China MSA, told the Green

Shiptech China Congress 2015 in Shanghai on 9 April.

According to Hui, the Strategic Study on the Development of the Whole Industries for

Container Shipping would ensure the safety of mega-container ships and their voyages at

sea. 'Whole industries' included ports, shipping companies, containers,, and cargoes, he

said.




Container ship 'CSCL Globe' of shipping company China Shipping Group in Hamburg, Germany.

Photo: PA

China MSA also hopes to boost the efficiency of the container shipping industry in China, as

well as the logistics operations and intermodal transport, and the study would seek input

from all four stakeholders of the Chinese container shipping industry.

The study comes as global container carriers have rushed to order mega-containerships with

capacities of up to over 21,000 teu.

[IHS Maritime 360]

Brazil: Santos Port unable to export 400,000 tons soy

09/04/2015

Brazil’s Port of Santos has been unable to export 400,000 tons of soybeans and

soymeal as firefighters try to extinguish a week-old blaze that has partially

restricted truck access to the country’s largest export hub, soy industry

association Abiove told Reuters on Thursday.

That’s about four days worth of typical shipments for April of around 3 million tons, Abiove’s

General Secretary Fábio Trigueirinho said.

The timing is particularly crucial as the world’s No. 2 soybean producer harvests a record

crop and exporters prepare to ship the product to China, which consumes about 70 percent

of the country’s output.

[Reuters]




G6 alliance members hit choppy water as they struggle to find

trade lane synergies

09/04/2015

Four of the six G6 alliance members recorded operating losses in 2014 as the

merged New World Alliance (NWA) and Grand Alliance (GA) grouping struggled

to integrate their respective east-west networks, according to Alphaliner’s

review of carriers’ publicly available financial results.

Hapag-Lloyd chief executive Rolf Habben Jansen alluded to problems within the G6, during

the company’s recent annual results presentation, when he said it had not been “super-

satisfied” with its membership.

Interestingly, all three NWA members, APL, HMM and MOL, operated in the red last year,

clocking up operating losses of $143m, $99m and $228m respectively. Of the GA members,

only Hapag-Lloyd recorded a loss. The German line suffered an operating loss of $149m,

NYK moved back into the black to a $46m profit and OOCL’s slick business model continued

to perform well above industry par with an operating profit of $230m.

The GA and NWA merged Asia-Europe routes in March 2012, followed by Asia-US east coast

services in May 2013 and Asia-US west coast in May 2014. Alphaliner suggested that the

integration of the G6 services “has not been smooth” – in particular on the US west coast,

where the six carriers operated out of seven different terminals in Los Angeles and Long

Beach. It was a situation doubtless aggravated by the terminal congestion that almost

coincided with the beginning of the vessel-sharing alliance.

There has been much industry speculation that the G6 is more cumbersome than alliance

rivals such as the 2M and Ocean Three, not least due to the number of partners, diverging

company cultures and geographical challenges.

Moreover, it is understood that the basic G6 agreement is, unlike the 10-year 2M deal

between Maersk and MSC, only valid until 2016, when presumeably the G6 partners will

review their positions and consider whether to continue their membership, or form

alternative alliances.

OOCL, for example, could consider its prospects of competing with 2M and Ocean Three

carriers were hindered by the weaker G6 lines and their desire and/or ability to secure

finance to operate ultra-large containerships.

A comparison of vessels on order is instructive: OOCL recently agreed an order for six

21,100 teu vessels with Samsung; MOL has six 20,150 teu ships on order from Japan and

South Korea; and NYK has eight 14,000 teu vessels under construction for long-term charter

from next year onwards, although four of these will also mean the return of four 13,200 teu




vessels on charter from OOCL. Hapag, APL and HMM currently have no confirmed ULCV

plans.

Meanwhile, of the 17 main carriers that publish their annual financial results, only ten

produced positive operating results for 2014, according to Alphaliner data.

With an operating profit of $2.34bn, Maersk Line easily topped the rankings with a margin of

8.6%, but Taiwanese niche carrier Wan Hai was close behind with an operating margin of

8.3%; although its operating profit of $178m was a fraction of Maersk’s.

“Carriers are expected to face another challenging year in 2015, despite the fall in bunker

fuel prices which will result in significant operating cost savings,” said Alphaliner, citing the

weakening of freight rates since the beginning of the year and the lower utilisation levels

being experienced on many tradelanes.

[The Loadstar]

Infographic: Oil tanker casualties

08/04/2015

IHS Maritime casualty data records 613 oil tanker incidents involving vessels of

more than 10,000 dwt over the past decade, of which only 13 incidents (2.1%)

were of sufficient severity to result in the total loss of the vessel.

Infographic: Oil tanker casualties. Image: IHS




The overall incident numbers recorded suggest the tanker sector has a better safety record

than other ship types such as bulk carriers or container vessels, perhaps due to the sector's

enhanced focus on accident avoidance.

The overall trend shows a marked decline after peaking at 82 incidents in 2007, with just 24

incidents in 2013, according to IHS Maritime data.

[IHS Maritime 360]

China: Chemical plant explosion forces ships to evacuate Gulei

Port

08/04/2015

China’s Ministry of Transport has asked ships docked at Gulei Port in Fujian to

evacuate from the port as a safety precaution after an explosion and subsequent

fire at a nearby chemical plant.

The plant, near Gulei Port, produces toxic chemical product para-xylene, and on Monday

evening an explosion occurred, causing a huge fire which was only put out Wednesday

morning.

Residents near the port have been evacuated, and maritime authorities have executed

contingency plans based on ocean pollution being caused by the incident.

Gulei port is a major port for petrochemical shipping in Fujian, and a petrochemical

industrial park has been developed there over the past two years, with expansion of the

park still ongoing. An explosion occurred at the same chemical plant two years ago.

[Splash 24/7]

U.S. / Canada: Icebreakers working to release 15 commercial

ships stuck in ice on Lake Superior

08/04/2015

Icebreakers from both the U.S. and Canadian sides were in action on Tuesday

trying to help release 15 commercial ships that were stuck in ice on Lake

Superior.

As many as 10 vessels alone were trapped in the solidified waters around Whitefish Bay in

Wisconsin.

One of them, self-unloading bulk carrier the Kaye E Barker (25,345 dwt, built 1952)

experienced hull damage and has been forced to transfer cargo. Four of the others were




expected to be freed by Wednesday morning. The remaining ones should be back on their

way by Thursday, officials estimate.

A sudden change of wind direction blew the ice field into the path of the commercial ships.

The ice field is about 35 miles long, and nearly eight feet thick in places. A force of two US

and one Canadian ice cutters were in the area as of Tuesday afternoon, with another

Canadian cutter set to join the group on Wednesday.

It’s rare to see this much ice at Whitefish Bay which sits on eastern Lake Superior between

Michigan and Ontario. The shipping season on the Lakes officially started late last month.

[Splash 24/7]

Jamaica: New operator of Kingston Container Terminal to

invest US$600 million in upgrading and expansion

08/04/2015

The Government and Terminal Link CMA CGM consortium signed a concession

agreement under which the new operator will invest US$600 million to upgrade

and expand Kingston Container Terminal (KCT).

Kingston Freeport Terminal Ltd (KFTL), a newly formed company, will operate KCT for 30

years before transferring it back to Jamaica. The company will also spend US$130 million to

dredge Kingston Harbour, a move that Prime Minister Portia Simpson Miller, as well as

Transport and Works Minister Dr Omar Davies said would free the country's balance sheet of

additional debt.

The dredging will also allow KCT to accommodate post-Panamax vessels which will start

entering the Caribbean when expansion work on the Panama Canal is completed.

Before signing the deal with Terminal Link President Farid Salem at Jamaica House

yesterday, Minister Davies explained that the expansion and upgrading work will be carried

out in two phases.

Phase one will see Terminal Link investing US$460 million on reinforcing 120 metres of the

berth to meet Euro codes 2004. In addition, 800 metres of the berth will be reinforced to a

depth of 15.5 metres. The US$200-million balance will be spent on phase two of the

expansion and upgrading work.

Davies recalled that when he assumed the portfolio in 2012, the divestment of the port was

one of three major projects that the Government wanted to implement as quickly as

possible.




"Significantly, I remember that CMA CGM had submitted an unsolicited bid and discussions

had started. However, the Office of the Contractor General had some concerns about this

method of procurement and the process was suspended," Davies said.

"Over time there were other expressions of interest and the decision was taken to invite

submissions from a number of global terminal operators. Five such companies responded to

our invitation and three were pre-qualified. Of the three, Terminal Link CMA CGM was the

only one to respond to the bid invitation.

"The irony of the situation is that we started with one unsolicited proposal, and three years

later we are about to sign with the same group," Davies added. "The negotiations have

been long, but I do believe our major objectives have been accomplished. One, we have a

global terminal operator linked with a major container shipping line which are the leaders in

their field," Davies said.

"Second, we have a multi-user port and we are clear that any legitimate shipping line can

participate and utilise the facilities."Third, the cost of dredging will be assumed by the

concessionaire, freeing the Government from this financial obligation," Davies said.

Salem, in his remarks, pointed out that CMA CGM is the world's third largest shipping

company with 445 vessels serving more than 100 ports globally. He said that his company

has a long history of relationship with the Caribbean and described Jamaica as a strategic

port for shipping lines.

"We like Jamaica. There is governance and security in this country and this is a good

environment for employees and employers," Salem said, adding that his company has

ambitious plans for the development of the port. The use of the word Freeport in the new

operating company's name, he said, was strategic, as they intend to attract investment, light

industry and processing services.

[Jamaica Observer]

Shipping and sea freight: Facing reality

08/04/2015

Supply growth again outpaced demand in most shipping segments in 2014 as

economic growth and world trade remained comparatively sluggish.

World trade growth was 3.4 percent in 2014 while the containership and bulk carrier fleet

expanded by 5-6 percent according to Clarkson. ISL’s Container Throughput Index increased

by an average of 4.3 percent year-on-year.

On the positive side, the orderbook remained rather flat for all shipping segments and is

highest for dry bulk vessels (22 percent). For containerships, the orderbook at the end of




2014 was the lowest it had been in 15 years according to Alphaliner (17 percent of the

existing containership fleet). And yet, capacity expansion will still be significant in 2015, with

the container ship fleet expected to expand by as much as 7.8 percent, particularly at the

larger end.

Freight and charter rates again failed to recover to sustainable levels. Container time charter

rates increased by 3.6 percent on historically low earnings for vessel owners while freight

rates declined by 5 percent. The crude oil tanker fleet increased by 1.4 percent and freight

rates declined by 13.5 percent, while the total fleet capacity of oil product tankers dropped

by 7 percent causing the clean tanker rates to rise by 28 percent. The Baltic Dry Index

ended up 65 percent below the prior year. Share prices remained depressed as well with

general shipping stocks ending 15 percent below the prior year (dry bulk stocks performed

worst, down 44 percent year-on-year).

Falling oil prices provided some relief on the cost base of shipping companies, but could

potentially cause a revision of the common strategy of slow steaming. In a type of prisoner

dilemma, the first shipping company to substantially increase steaming speed could

eventually cause a broader trend in the market that would intensify cascading effects and

fuel consumption.




Outlook

Whilst there will be individual segment bright spots and occasional peaky rate volatility,

persisting structural imbalances in shipping supply and demand as well as economic

headwinds will make a sustainable recovery in 2015 unlikely for the sector as a whole.

Trends such as re-and near-shoring of production and increasing intra-regional trades,

especially within Asia, have already lead to a new consensus estimate of future shipping

demand in the mid-single digit range.

The recovery has been consistently postponed in each of the years after the financial crisis.

Although the situation on the supply side has to a certain extent improved in more recent

years, there is a new reality of sluggish and volatile demand growth which will again delay

the recovery (for this year at least). The numbers back this up:

Dry bulk shipping can be expected to be negatively affected by slowing economic

growth in China this year (with Chinese demand for iron ore being the biggest driver

of dry bulk volume growth). BIMCO expects demand growth to slow to 4-5 percent in

2015. We are seeing examples of dry bulkers being converted to tankers and

previous orders switching out of the dry bulk sector.

For container liners, growth of the container ship fleet (7-8 percent) is expected to

outpace world trade (3.5 percent) and container demand growth (5.5 percent) this

year, hence excess capacity will again last through 2015. The major lines are




growing their mega-carrier capacity and smaller tonnage cascades from the

mainlanes to other trades. But there may still be brighter spots for investors in

smaller tonnage where oversupply is not so prevalent.

World oil demand is expected to increase by 1.2 percent in 2015, leading to a 3-4

percent growth in tanker demand. Combined with an increase in tonne miles and

demand for floating storage, this could outpace supply growth and is already driving

an increase in tanker rates. As we write VLCCs are earning more than US$ 50,000

per day for storage against breakeven of around US$ 15,000.

[KPMG Transport Tracker]

Merger and acquisition activity in the transport and logistics

sector set to surge

08/04/2015

Merger and acquisition (M&A) activity in the transport and logistics sector are set

to pass the high levels seen in 2014, according to the latest KPMG ‘Transport

Tracker’.

The first quarter of 2015 has already seen completed global transactions worth £6.7bn,

according to the report, and further acquisitions valued at £6.7bn have already been

announced. In 2014 the increase in the volume of transactions resulted in £39.6bn worth of

deals.

Drivers for the surge include a rise in purchase prices, meaning that the average business

valuation of transactions in the transport sector increased in 2014 to 11.9x of EBITDA,

compared to 9.0x in 2013. KPMG says this was due to the increase in strategic acquisitions

and the increased appetite for takeovers of transport companies combined with low

availability of suitable target companies that are for sale, and the trend is set to continue in

2015.

“Total deal values of transport and logistics transactions in 2014 amounted to £39.6bn and

we expect this figure to be superseded in 2015,” said James Stamp, UK head of transport,

KPMG.

“In addition to high-volume transactions for the purpose of inorganic growth (particularly by

US companies as a result of the strength of the US dollar) we expect selective acquisitions of

specialised IT and e-commerce companies will increasingly shape the M&A strategies of

transport companies,” he added.

KPMG also says the increase in private investment in transport infrastructure operators in

the sector will remain a key driver of business transactions. Governments in both emerging

and mature markets increasingly “lack the financial flexibility to ensure sufficient investment




in infrastructure”, says the report. This increasingly comes from private investors, who are in

turn “in search of stable sources of income”.

Transport infrastructure transactions (ports, airports, road operations) amounted to a total

value of US$15.1bn in 2014, which is only half of the prior year values but still the second

highest value of the past seven years.

According to the report, consolidation, geographical expansion and vertical specialisation

remain the predominant reasons for transactions in the sector.

[Port Strategy]

New E-Containerlock tipped to save billions

08/04/2015

E-Containerlock has been developed by UK-based Guardfreight and can be fitted

to all types of shipping containers, roller shutter doors, trailer barn doors and

bulk liquid tankers.

A Midland company has

launched an innovative

locking device which aims to

put a stop to the scourge of

theft from shipping

containers - a practice which

is estimated to cost around

£54 billion each year.

E-Containerlock has been

developed by Droitwich-

based Guardfreight and can

be fitted to all types of

shipping containers, roller

shutter doors, trailer barn doors and bulk liquid tankers. The device, which has been

developed by Guardfreight directors Andrew Harrison and Wayne Cressman, overcomes

several security flaws experienced by conventional locks. It also features a unique, in-built

GPRS tracking system that provides location updates and immediate alerts if entry is forced.

The product has just completed nine months of rigorous testing and global trials, with more

than 300 journeys across the US, Asia, Africa, South America and Europe made with E-

Containerlock fitted. Pre-release interest has seen a number of devices delivered and trialled

by potential customers from the US and Mexico to Africa, Europe and the Middle East.

[Birmingham Post]




U.S.: Seattle and Tacoma miss port alliance deadline

08 08/04/2015

The original plan was to receive federal approval by June 15 and have Seattle

and Tacoma port commissioners formalize the Seaport Alliance on July 1. The

new goal is Aug. 1.

Turns out, combining the cargo operations at the ports of Seattle and Tacoma is every bit as

complicated as the commissioners predicted when they announced their intention to form a

seaport alliance six months ago.

Port of Tacoma commissioners approved an extension March 19, and the Port of Seattle

approved it March 24 — one week before the draft Seaport Alliance agreement was

scheduled to be made public and sent to the Federal Maritime Commission for approval.

The issues are big and the lists are long,” Port of Seattle deputy CEO Kurt Beckett said in an

interview last Friday. “You get into the details and you get more work.” The original plan

was to receive the federal commission’s approval by June 15 and have the two ports

formalize it July 1. That date is now estimated to be Aug. 1, Beckett said.

The two ports are betting that unified management of marine cargo will grow jobs and allow

them to compete better against other West Coast ports, from British Columbia to Southern

California. They also will face more competition from East and Gulf Coast ports once the

widened Panama Canal opens next year.

One of the stumbling blocks to creating the alliance is how to value each port’s assets. The

idea is for an even split, so that once the alliance is formed, each port receives 50 percent of

the revenues and profits.

Take Terminal 5 in Seattle, for example. The commissioners said it is one of the best

container terminals in Puget Sound. However, it is in the beginning stages of becoming big-

ship ready and currently has limited cash-flow, with only an interim lease with Foss

Maritime, rather than a long-term tenant.

Port of Tacoma Commission President Don Johnson said at a March 10 meeting that

commissioners should not be driven by deadlines, acknowledging more time was needed. “

Everybody needs to be comfortable with the decisions that are on the table,” he said.

[The Seattle Times]




Royal Dutch Shell to buy BG Group for nearly $70 billion

08/04/2015

Energy companies have spent months in a state of strategic paralysis, wary of

making big moves with oil prices plunging.

Now, the mind-set is shifting, as the industry giants look to capitalize on the weakness. On

Wednesday, Royal Dutch Shell agreed to buy the BG Group for $70 billion. It is the first

major deal for an oil and gas producer since prices started falling last summer.

The acquisition could provide a template in the current environment, with deep-pocketed

players taking advantage of their competitors’ problems to bolster their own position. In

buying BG, Shell is concentrating on the fast-growing business of producing and selling

liquefied natural gas. It will also become a major player in Brazil’s offshore oil fields, where

Shell’s exposure has been small.

Shell is taking advantage of the financial struggles of BG. Before the deal was announced,

BG had watched its shares fall more than 30 percent since May.

Deal makers have predicted that the plunge in oil prices could spark interest among would-

be acquirers eager for bargains. Other potential buyers, like private equity firms, have

amassed billions of dollars to hunt for new trophies.

Many of these bankers and lawyers, though, have cautioned that would-be sellers may find

other ways to raise money, rather that risk auctions at fire-sale prices. For example, Whiting

Petroleum, a midsize oil and gas company, chose to raise $2 billion in debt and sell 35

million shares after failing to draw an attractive takeover offer.

But the attractions of energy mergers — including the benefits of greater scale and the

ability to move into productive fields of oil and gas — may ultimately compel many players

to the negotiating table.

Shell, in large part, is betting on a changing international energy market.

As global energy needs have soared, companies are looking to liquefied natural gas, or

L.N.G., to meet the demands. The process involves supercooling natural gas into a liquid

that can be transported around the world on ships. By doing so, natural gas has become a

global commodity, with companies bringing supplies from remote locations in Africa to

energy-hungry markets like China and India.

Royal Dutch Shell’s purchase of BG Group could mark the start of a new round of

consolidation in the oil and gas industry, as the steep fall in oil and gas prices has weakened

many midtier players.




[International New York Times]

The world’s largest oil companies are about to start devouring

each other

08/04/2015

It was only a matter of time.

The Wall Street Journal reports that international oil giant Royal Dutch Shell is in talks to

buy BG Group, a giant shipper of natural gas with extensive holdings in Brazil’s oil fields. It

may be the opening shot of a consolidation war that many have been expecting.

The reason, of course, is the collapse of global

oil prices over the last year. Still, most

expected that if a merger mania were to break

out in the energy industry, it would be primarily

focused on smaller cash hungry companies that

have seen their valuations slashed by the

collapse of crude oil prices.

A deal between BG, which has a market value

of roughly £31 billion ($46 billion), and Royal

Dutch Shell, whose value hovers around $193.4

billion, would be a merger of a different order. It would leapfrog Chevron as the second-

largest publicly traded oil entity on earth, behind Exxon Mobil.




Royal Dutch Shell’s motivation is clear. It’s making a

bet, in part, that BG’s oil and gas holdings look cheap.

(BG had to write down the value of its assets by $9

billion recently to reflect the decline of energy prices.)

But the deal is risky too. BG Group partnered with

Brazilian oil giant Petrobras to develop its highly

productive fields in the South American nation. And

with Petrobras increasingly distracted by a widening

corruption scandal, it raises the prospect of disruption

for BG. Elsewhere BG’s giant investment in Australia

aimed at converting and exporting natural gas has also

been jolted by the sharp changes in energy prices.

Of course, this deal might never come to fruition at all.

But given the massive jolts in the energy markets it

likely won’t be the last you hear about energy M&A

over the next few months.

[Quartz]

Panama: Corruption complaint filed concerning irregularities in

licensing of ship officers

08/04/2015

The former administrator of the Panama Maritime Authority (AMP) Roberto

Linares and several of his team, as well as the company Orion Maritime Training

Centre are facing a complaint before anti-corruption prosecutors in Panama.

The complaint is for allegedly committing multiple offenses against the public administration,

collective security and electronic media legal security that Linares may have committed

causing prejudice against the AMP.

The AMP has performed an audit revealing that the AMP’s former management under

Roberto Linares failed to supervise the licensing process of Panamanian ship officers

performed by the Orion Maritime Training Center, the local daily La Prensa reports.

The AMP presented a complaint to the public prosecutor against Linares and other former

agency officials on January 30. The complaint includes Roberto Vallarino, former director of

the Seafarer's Department (2009-2011), and his successor, José Rogelio Hernández (2011-

2014). It also named Jorge Antonio Torres, who was the head of the department in the

Philippines.

Panama City-based Orion Maritime Training Center received an exclusive license to approve

the assessment or valuation of licenses of Panamanian ship officers. In 2011, Linares




approved a pilot plan so that several companies could issue evaluations or assessment of

ship officers, but Orion dominated this field until the end of the government of Ricardo

Martinelli.

During the audit, the AMP investigated the mechanisms used in the assessment process, as

well as the level of compliance with international standards, which discovered a number of

irregularities.

The AMP also reported that Orion refused collaboration and tried to delay the audit. The

company also failed to show records of all assessments that were supposedly carried out. It

is estimated that Orion issued approximately 10,000 assessments, but it is presumed that

the amount may be greater, considering that the company had operations outside Panama.

Each assessment reportedly cost between USD 5,000 and USD 6,000. Orion was closed last

year following the change of government.

The authorities are also investigating a possible intentional removal of information from the

database of the Directorate of Seafarers.

[World Maritime News / La Prensa / Newsroom Panama]

Netherlands: Rotterdam in Maasvlakte Plaza plan

08/04/2015

In a bid to improve the security of parked trucks, the Port of Rotterdam Authority

is currently developing an international transport park, the ‘Maasvlakte Plaza’,

with large-scale truck parking and modern facilities for both drivers and trucks.

Image source: Rotterdam Port Authority




Maasvlakte recently announced its container exchange initiative that would enable a free-

flow of containers between all of Maasvlakte's terminals. The project aims to double number

of paid parking spaces for trucks in the Port of Rotterdam to 700.

Ronald Paul, COO at the Port Authority of Rotterdam, said: “Thanks to the central location,

close to the big container terminals, Maasvlakte Plaza can be used in the future to further

develop the principle of the ‘Virtual Gate’ whereby all kinds of inspections and customs and

administrative operations can be coordinated optimally. That can be achieved by improving

uniformity in the logistics process.”

The Maasvlakte Plaza will be a secure truck park with 359 parking spaces, over 80 of which

will be able to accommodate trucks carrying dangerous goods. There will also be facilities

for trailers, ECO-Combis (extra long vehicles), reefer containers and special shipments.

Contractor Van Gelder B.V. will be responsible for the civil engineering work and the

construction of the truck park. The Port Authority expects Maasvlakte Plaza to open in 2017.

[Port Technology International]

Mega ships get fatter but not much longer, limiting cranes

alongside

08/04/2015

The mega problem with mega ships is that there are no purpose-built mega ports

to handle cargo in a manner befitting of tomorrow's state-of-the-art 20,000-TEU

containership, says Drewry Maritime Research.

Drewry analysts point out a crucial technological shortcoming for even the biggest ports:

ships may be getting fatter, but not much longer. An 18,000-TEU box ship is only 25 per

cent longer than a 7,400-TEU vessel yet has 150 per cent more capacity.

For example, the 19,200-TEU MSC Oscar is less than twice the length of a first generation

1,400-TEU ship, but its capacity is 14 times greater, reports the Journal of Commerce (JOC).

That means that the number of cranes alongside cannot grow proportionally with the

increasing ship sizes, and the broader and deeper the cranes must reach to draw boxes cuts

into their moves per hour.

Putting it another way, a 19,000-TEU vessel is 50 per cent bigger than a 13,000-TEU ship,

but the berth moves per day are only 20 per cent higher. "Bigger ships are spending

proportionately more of a round voyage in port than their predecessors. Overall berth

productivity does increase with ship size," said Drewry.

"Cost and availability of labour restricts the number of additional cranes that can be

deployed on each ship," Drewry noted. To meet the industry target of 6,000 moves in 24




hours demanded in 2011 by Maersk Line's then-CEO Eivind Kolding, a 19,000-TEU ship

would require eight cranes, each working at 35 moves per hour, instead of 25, generating a

berth productivity of 280 moves per hour.

Drewry said an industry consensus held that 3,000 to 3,500 moves in 24 hours is a realistic

top-end performance for a large terminal handling large vessels. Yet once Maersk sought

6,000 moves a day on a 19,000-TEU ship that would require eight cranes, each working at

35 moves per hour, instead of 25. Maersk Line CEO Soren Skou saw the limit of 40 moves

per hour.

According to the JOC, the UAE's Khor Fakkan has the world's highest berth productivity,

achieving 179 berth moves per hour on average in 2013, that's 4,300 moves in 24 hours.

[Hong Kong Shipping Gazette]

U.S.: Ship management company fined $283,500 for breach of

emissions regulations

07/04/2015

A ship management company has been fined $283,500 in connection with a

breach of clean air regulations in the United States, the International Transport

Intermediaries Club (ITIC) has confirmed.

ITIC reports that an inspector of the California Air Resources Board, the clean air agency of

the state of California, boarded a ship in July 2011 at a terminal in Los Angeles. The chief

engineer was asked if he was aware of the revised 2009 California clean air regulations

which required vessels to switch main engine, auxiliary engines and auxiliary boilers to low-

sulphur fuel when in California-regulated waters. The chief engineer said he was only aware

of the requirement to switch auxiliary engines to low-sulphur fuel in accordance with

regulations effective from January 1, 2007.

The master checked the vessel’s Safety Management System (SMS) but was unable to locate

the 2009 requirement. The inspector then examined the records of fuel switchover for the

vessel’s main engine, auxiliary engines and auxiliary boilers, and ascertained that the ship

had called at California ports seventeen times between 2009 and 2011 without switching

over the main engine or the auxiliary boilers. A penalty of $283,500 was imposed on the

shipowner for failure to switch fuel during the seventeen port calls. The owner claimed

against the manager, maintaining that the manager had been negligent.

ITIC said, “In 2009, a fleet circular had been sent to all vessels by the manager, setting out

the change in regulations, and asking that it be displayed in a prominent position. The

manager therefore initially rejected the claim on the ground that it had resulted from crew

negligence, which was excluded under the BIMCO management agreement. The owners,

however, did not accept this rejection, maintaining instead that the manager had failed to




update the SMS. As it was considered unlikely that the manager would successfully defend a

claim resulting from its failure to update the SMS, the claim was paid in full.”

[MarineLink]

U.S.: Shell seeks to remove Greenpeace activists from drilling

rig

07/04/2015

Royal Dutch Shell Plc said it has filed a complaint in federal court in Alaska

seeking an order to remove Greenpeace activists who climbed aboard an oil rig in

the Pacific Ocean bound for the Arctic on Monday in a protest against Arctic

drilling.

Greenpeace activists scale the Polar Pioneer drill rig in the Pacific Ocean in this April 6, 2015 picture

provided by Greenpeace. REUTERS/Vincenzo Florama/Greenpeace

The environmental group said in a statement its team would occupy the underside of the

main deck of the Polar Pioneer, which is under contract to Shell, and plans to unfurl a

banner with the names of millions of people opposed to Arctic drilling. The group said the

activists would not interfere with the vessel’s navigation.

“We’re here to highlight that in less than 100 days Shell is going to the Arctic to drill for oil,”

32-year-old Johno Smith, one of the six to board the Blue Marlin, the ship carrying the rig,

said in the statement. “Shell’s actions are exploiting the melting ice to increase a man-made

disaster. Climate change is real,” he added.




Shell said in an emailed statement that it has met with groups against oil drilling off Alaska’s

shores and “respect their views” but condemned the boarding. “We can confirm that

protesters from Greenpeace have illegally boarded the Polar Pioneer, under contract to

Shell, jeopardizing not only the safety of the crew on board, but the protesters themselves,”

Shell said.

The move comes just days after the U.S. Interior Department upheld a 2008 lease sale in

the Chukchi Sea off Alaska, moving Shell a step closer to returning to oil and gas exploration

in the Arctic since it suffered mishaps in the region in 2012.

Many environmentalists oppose offshore energy exploration in the Arctic, saying that once

production begins any oil spill would be extremely difficult to clean up. Oil industry interests

say the Arctic will be important to the United States’ energy security in coming decades

when output from shale formations is expected to wane.

Images published by Greenpeace showed the activists using climbing gear to move from an

inflatable boat onto the Blue Marlin heavy-lift vessel towing the Pioneer, one of two drill rigs

heading to the region, as it cruised some 750 miles (1,207 km) northwest of Hawaii.

[Thomson Reuters]

Iraq seeks investors for $6.5 billion Grand Faw port project

07/04/2015

The Iraqi Ministry of Transport has invited international investors to register

their interest in the country’s proposed Grand Faw port project.

Image source: Tradearabia.com




“The ministry of transport announces the Grand Faw Port project as an investment

opportunity for qualified investors,” the ministry said in a letter to embassies, adding that

the bidding was only open to ‘serious and financially able’ companies.

The project is expected to cost around $6.5 billion in total with a first phase due to be

completed in 2018. “The aim of this measure is the promotion of investment in the Port of

Faw,” a ministry spokesperson said in a statement, calling the project “a vital economic

lifeline” for Iraq.

“[The port] will contribute significantly to the support of industry, commerce and the

operation of labour sectors and open up new prospects for trade with all countries of the

world.”

The initial phase of work will increase capacity to 2 million TEU as part of a strategy to

ultimately reach capacity of 20 million TEUs and handling capacity of around 99 million

tonnes per year. The investment will be used to construct a 39km container quay and 2km

of berths along with a container warehouse and hinterland covering more than one million

square metres.

The port project has suffered repeated setbacks since an initial call for tender was

announced as long ago as 2012. Falling oil prices have impacted government revenues

limiting the ability to support the project and ongoing security concerns have caused

hesitancy from international investors.

[Port Finance International]

Canada / U.S.: Frustrated tar sands industry looks for Arctic

export route

07/04/2015

With the Keystone XL and other pipeline projects running into stiff opposition,

Alberta’s tar sands industry is facing growing pressure to find ways to get its oil

to market. One option under consideration would be to ship the oil via an

increasingly ice-free Arctic Ocean.

The Alberta tar sands industry — and the governments that depend on tar sands tax

revenues — are facing an increasingly pressing problem: How to get the growing flow of oil

sands bitumen to market. And with proposed pipelines to the south, east, and west facing

stiff opposition, tar sands interests are now investigating another controversial option —

heading north and shipping their product via the Arctic.

To the south, the proposed $10 billion Keystone XL pipeline, which would transport Alberta

tar sands oil through the heartland of the U.S. to refineries on the Gulf of Mexico, faces the

possibility of being killed by the Obama administration later this year. Two pipeline proposals




that would ship processed bitumen from Alberta’s tar sands to Canada’s Pacific Coast have

been stalled by aboriginal, municipal, and environmental interests, who fear spills in

environmentally sensitive mountain and coastal environments. A third project — Trans

Canada’s Energy East Pipeline proposal, which would send Alberta oil to Atlantic Canada —

has encountered such strong resistance that the pipeline company last week announced a

two-year delay in its plans.

Possible pipeline routes for shipping Alberta tar sands oil via the Arctic Ocean. Source: Canatec

Associates International

These setbacks have led to the revival of an old idea by oil interests and the governments of

Alberta and the Northwest Territories: Sending Canadian oil north through a so-called “Arctic

Gateway.” One possible pipeline route would run from Alberta, through Saskatchewan and

Manitoba, to the port of Churchill along the west coast of Hudson Bay. From there the oil

would travel by tanker through the increasingly ice-free Arctic Ocean to the Atlantic or

Pacific oceans. Another possible route would follow the Mackenzie River Valley to the hamlet

of Tuktoyaktuk on the Arctic Ocean and on to the Pacific.

“Alberta can play a leading role in the opening of the Northwest Passage,” says a 2013

report by Canatec Associates International that was commissioned by the Alberta provincial

government and is now attracting renewed attention. “This will be a revolution in global

logistics, equal in impact to the opening of the Suez or Panama canals.”




Far-fetched as these alternatives seem to be during this time of low oil prices, the Arctic

Gateway concept has nevertheless been getting a surprising amount of government

attention, if only because no one seems to be able to get a tar sands pipeline built

elsewhere. A spokesman for Alberta Energy Minister Frank Oberle said the province “is

actively pursuing the Arctic Gateway idea.” Northwest Territories Premier Bob McLeod said

recently that an Arctic-bound oil pipeline along the Mackenzie Valley would be vital to

helping the territories tap into an estimated 10 billion barrels of oil and 92 trillion cubic feet

of natural gas.

The search for new routes to send oil sands bitumen to market is critical for the Alberta tar

sands oil industry, which is planning to triple production from 1.5 million barrels a day

currently to 4.5 million barrels a day by 2030. And the Alberta and Canadian governments

also are counting on the steady growth of tar sands production to boost tax revenues.

The recent collapse in oil prices has left the Alberta government, in particular, facing severe

budget shortfalls. A leading Canadian bank has estimated that Alberta could lose $7 billion in

revenue in 2015 if oil sells at $70 a barrel — significantly higher than current prices. In

March, Alberta did the unthinkable by raising income taxes and user and license fees across

the board, as well as making spending cuts to almost every government service. Even with

that, the province faces a staggering $5 billion budgetary shortfall for the coming year.

Meanwhile, the Canadian government, which could lose $5 billion or more in oil revenue in

2015, has taken the unusual step of delaying its annual budget plan until the fallout from

oil’s collapse can be better assessed.

“If the Arctic Gateway proposal succeeds, it would be reasonable to assume that oil sands

production would expand significantly from current levels,” said Victoria Herrmann, a Gates

Cambridge Scholar who is associated with the Center for Circumpolar Security Studies at the

Washington D.C-based Arctic Institute. “Currently, the pipeline capacity to transport the

level of crude oil Alberta wants to produce to refineries is non-existent. If Canada wants to

fulfill its planned expansion [of the tar sands] it will need the infrastructure to transport the

petroleum to the global energy market. Without some means of getting the bitumen out of

Alberta, oil sands production stands to face a serious decline.”

Many energy experts are skeptical that any version of an Arctic Gateway route for oil export

will see the light of day. They say that the Arctic pipeline proposals reflect rising worries in

the tar sands industry about getting its bitumen to market.

“I can't imagine there's enough value in a barrel of bitumen to make any of this worth

doing,” says Andrew Leach, a University of Alberta energy expert. “If you think about

bitumen being worth about $50 per barrel at today's prices, to dilute it and ship it through

that kind of infrastructure to get it to market is unlikely to make producing it worthwhile. I

can't see it as economically feasible.”




Doug Matthews, the former director of oil and gas in the Northwest Territories, agrees. He is

especially skeptical of a proposal to initially ship the bitumen down the Mackenzie Valley by

rail, then by barge to the Arctic coast before it is loaded offshore onto tankers. (If Arctic

shipping proved feasible, the railways cars and barges would eventually be replaced by a

pipeline.)

“The bitumen would have to be handled three times, and then a way would have to be

found to store it for several months during the winter season,” he said. Government and

industry, however, may see no other alternatives if Keystone XL and the major Canadian

pipeline proposals fail to get back on track.

A little less than a year ago, most experts were confident that a way would eventually be

found to get Alberta’s bitumen to market, in spite of the fierce opposition to Keystone XL

and other pipelines. Far too much was at stake, they reasoned, to allow one or more of the

pipelines to fail.

The lack of access to pipeline capacity has already persuaded energy companies such as

Statoil to back off on multi-billion dollar investments in the tar sands. “Costs for labor and

materials have continued to rise in recent years and are working against the economics of

new projects,” said Statoil Canada’s Ståle Tungesvik, explaining why the company in

November delayed for three years its Corner project in Alberta, projected to produce 40,000

barrels of oil a day. “Market access issues also play a role — including limited pipeline

access, which weighs on prices for Alberta oil.”

Statoil’s announcement came just months after Total and Suncor Energy Inc. indefinitely put

on hold their $11 billion Joslyn North oil sands project, which would have produced 160,000

barrels a day by 2020.

Lack of pipeline capacity is one reason why Alberta has invested in two studies that consider

the feasibility of an Arctic Gateway route for tar sands oil. According to the 2013 report done

by Canatec Associates, climate change is quickly melting the sea ice that had previously

made shipping oil through the Arctic impossible. The authors of the report also note that “an

aggressive push from the Canadian government to reduce environmental oversight” in the

Arctic makes the proposal much more viable.

The report’s authors outline several scenarios in which Alberta’s bitumen might move north

along pipelines to the west coast of Hudson Bay, or via the Mackenzie Valley to the coastal

town of Tuktoyaktuk by pipeline or train, barge, and tanker. The appeal of the Tuktoyaktuk

project is that Canada’s National Energy Board has already approved that route for a

different pipeline project, which is in limbo. All but one of the aboriginal groups in the

Mackenzie Valley supported the earlier project,

Another report, commissioned by the Alberta government and scheduled for release this

spring, will evaluate the feasibility of a plan to build a railroad from northern Alberta through




British Columbia and the Yukon to Valdez, Alaska, where bitumen would be shipped to

overseas markets.

The proposed 2,400-kilometer railroad was once the dream of former Alaska Senator Frank

Murkowski, who was behind the “Rail to Resources” legislation passed by the U.S. Congress

in 2000. This latest idea is the brainchild of a Vancouver-based business consortium that

calls itself Generating for Seven Generations.

These various proposals represent an important shift in attitude among energy interests and

government officials in Canada. Once unthinkable, a steep decline for the tar sands industry

is no longer a totally outlandish idea, even to boosters such as Terence Corcoran, editor of

Canada’s Financial Post section of the Toronto-based National Post newspaper. In a recent

column he predicted that the failure to get a pipeline built from Alberta’s tar sands might

result in “the end to Canada’s oil superpower pipe dreams.”

[Yale Environment 360]

Benin and Niger finalise terms of Bollore’s 1 billion euro rail link

07/04/2015

Niger and Benin signed a deal on Tuesday to finalise the terms of the

construction and operation of a railway linking Niamey with the port of Cotonou,

expected to be finished in the middle of next year.

Image source: SkyscraperCity.com




French firm Bollore will cover the entire 1.07 billion euro cost of building the rail link,

according to the terms of the deal.

“We have created the conditions to guarantee the harmonious, diligent and efficient

operation of this ambitious and historic project,” said Niger’s Planning Minister Amadou

Boubacar Cisse.

Bollore will own a 40 percent stake in the operator BENI rail, in which the two countries will

each own 10 percent. The remaining stake will be owned by private investors from Niger

and Benin.

Work began in April 2014 on a 574 km railway to join Niamey to the eastern Benin town of

Parakou, which has an existing rail link to Cotonou. The line is expected to carry mostly

freight, with passengers accounting for only a fifth of its activity.

At the inauguration of a commercial zone at the railway station in Niamey on Tuesday,

President Mahamadou Issoufou said the company could be awarded a concession in the

coming weeks to build a rail link from Niger to the capital of neighbouring Burkina Faso,

Ouagadougou.

The link would form part of a planned 2,800 km network joining up Ivory Coast, Benin,

Burkina Faso, Niger.

[Reuters]

Hong Kong: OOCL orders six 21,000 TEU vessels

07/04/2015

Hong Kong-based container shipping company Orient Overseas Container Line

(OOCL) is to set a new world record for its recent order with Samsung Heavy

Industries (SHI) for six containerships, with each ship measuring up to 21,000

TEU, the largest ever container ship to date.

PTI previously reported that the order would cost the shipping line around US$950m and

would be financed by external investors. In gCaptain, SHI were quoted as saying: “It is

expected that orders for ultra-large container ships will continue, as global shipping alliances

are competing to expand their fleets. We will receive additional orders by offering optimized

ship solutions and a range of eco technologies.”

CMA CGM placed an initial order for three 20,000 TEU ships to increase its ship capacity,

before placing a follow-up order for three more in order to take advantage of its recent

profit increase.

(Port Technology International]




China: Cosco to order at least ten 19,000-teu containerships

07/04/2015

China Cosco Holdings is in the final stages of completing a $1.4bn order for “at

least” ten 19,000-teu containerships from a Chinese shipyard.

Five different shipyards are in the running to take the order, which should be finalised by

the end of May, sources told the WSJ.

A source connected with the giant Chinese shipping conglomerate told Splash the funding

for the ships was an acknowledgement from central authorities for Cosco’s leading role in

adhering to Beijing’s ship scrapping plans. Cosco has sent 109 ships to be recycled since the

start of 2013.

The new ultra-large container vessels (ULCVs) will be deployed in the Asia-Europe trade, but

the order seems to have been placed more to keep pace with competitors Maersk and MSC,

rather than to meet trade demand. Cosco still has reservations that it may not be able to fill

the vessels, the WSJ reports.

Cosco is currently subject to rigorous anti-corruption measures, after its former vice-

president was jailed for 10 years for corrupt business practices.

Much of the Chinese conglomerate’s larger vessels have been chartered from Costamare or

the Washington Group, so the owned larger vessels represent a slight change of direction

for Cosco.

K Line would be a likely candidate to place orders for ULCVs in the future, a source told

Splash.

[Splash 24/7]

Ballast Water Management Convention: 'Certainty, challenges,

cost and confusion'

07/04/2015

At a summit on ballast water management last week in Athens the discussions

can be summed up in four words, "certainty, challenge, cost, confusion".

Held under the auspices of the influential Greek Marine Technical Manager Association,

Martecma, the summit, left little doubt there are many challenges ahead. As summit and

Martecma chairman, Stavros Hatzigrigoris, noted “all engaged in the BWM exercise, from

ship operators through class societies, flag administrations to equipment vendors, are

certain BWM is here, it poses great challenges, it is costly and it is causing confusion”.




As md of Maran Gas Maritime, part of the Angelicoussis Group, Hatzigrigoris is among Greek

owners well versed in BWM with systems on board many of its tankers and VLGCs.

From the outset, keynote speaker Debra DiCianna, ABS' senior environmental solutions

engineer, warned the requirements of “a convention not yet ratified” but, all the same, is in

force presented "many challenges for shipowners both operating in the US and globally".

Under the Ballast Water Management Convention (BWMC), "Complex and expensive systems

need to be installed onboard ship.”

She believes it is only a matter of time before the outstanding 2.14% tonnage requirement

is attained for the convention to be ratified. "We know flag administrations tend to

announce ratifications at IMO meetings". The next meeting is in May.

Among flag administrations yet to ratify are Bahamas, China, Greece, Malta, Panama,

Singapore and the UK, each alone could bring the convention into force. Argentina,

Indonesia and Italy have indicated they are in the process of ratification.

As was expected it was hammered home that notwithstanding IMO’s BWMC, vessels

wanting to operate in US territorial waters must be fitted with BWM systems that are USCG

type approved in accordance with their implementation schedule. It was also stressed the

USCG is well known for insisting on stricter test standards with a view to giving a greater

confidence on the reliability of BWMS.

But, as Intertanko deputy md, Joe Angelo pointed out the first vendor request for USCG

type approval came in just recently, in March and “the coast guard indicates it expects to

have USCG approved BWMS sometime in 2015”.

“For proprietary reasons, the USCG cannot tell us which BWMS manufacturers are currently

pursuing USCG approval,” said Angelo. He added, “Intertanko contacted BWMS

manufacturers to determine which of them have submitted a ‘letter of intent’ and 14 BWMS

manufacturers informed us they intend to pursue USCG approval.” There are over 50

equipment vendors out there.

But, only after the testing is completed and the results have been evaluated, will a BWMS

manufacturer then submit an application to the USCG for approval of their BWMS and this

will take months.

Angelo said the coast guard “understands potential installation scheduling problems once a

BWM system is approved” and the coast guard “indicates they will be pragmatic [whatever

that means] in requiring when a ship calling at US ports must have a CG approved BWM

system installed”.

But the US is not party to IMO BWM treaty, noted Angelo, while also noting the USCG allows

the use of Alternate Management System (AMS) for five years after which a ship trading in

the US will require a USCG approved BWMS.




And there’s the dilemma for the owner. “The ship operator must decide to either install AMS

and hope it gets USCG approval or request an extension and hope there is a coast guard

approved BWMS available for installation on their ship prior to the required installation date

under the IMO convention,” he said.

[Seatrade Global]

FedEx to buy TNT for $4.8 billion to take on rivals in Europe

07/04/2015

FedEx Corp is to buy Dutch package delivery firm TNT Express for an agreed 4.4

billion euros ($4.8 billion), stepping up the challenge to rivals United Parcel

Service and Deutsche Post in Europe.

European regulators blocked a 2013 takeover of TNT by UPS due to concerns it would stifle

competition, but analysts and executives said on Tuesday FedEx, with its strong air fleet,

would complement TNT's sizeable European road network.

"Europe, despite the fact that there has been low growth, is still an enormous market both

for import and export," FedEx Corp. Chief Executive Fred Smith told analysts. TNT gives

FedEx access to pan-European service and the domestic UK and French markets, areas

where it is not yet a big player, Smith said, while TNT customers will get access to FedEx's

global distribution platform.

ING analysts estimate Deutsche Post's DHL currently has a 19 percent market share in

Europe, followed by UPS with 16 percent, TNT with 12 percent and FedEx at 5 percent --

meaning the deal could catapult FedEx to second place.

FedEx will offer 8 euros in cash per ordinary TNT share -- a 33 percent premium on last

week's close, though below UPS's 2013 offer of 9.5 euros. Memphis, Tennessee-based

FedEx is financing the deal with debt, the latest company to take advantage of low interest

rates.

TNT shares were up nearly 30 percent on Tuesday, close to FedEx's bid price, while FedEx

stock rose 3.6 percent. "FedEx has laid on the table an attractive offer price," said ABN

Amro analyst Maarten Bakker, who has a "hold" rating on TNT shares. "With FedEx having

always been the most logical predator of TNT Express, we see the chances of a competing

offer as slim."

FedEx finance chief Alan Graf said the company would "be very aggressive on spending on

integration in the first year," and the deal would create unspecified cost synergies.




The deal has been unanimously recommended by TNT's supervisory board. TNT's largest

shareholder, PostNL, also said it would tender its 14.7 percent stake to FedEx. PostNL

shares rose 17 percent.

"Smart move"

European regulators' decision to block UPS's bid for TNT dealt a blow to the Dutch firm,

which had been counting on adopting much of UPS's logistics backbone. TNT, whose

European market share has slumped by as much as 5 percentage points since that deal fell

apart, has cut costs, sold operations and invested in its road network in an effort to hold on

to customers in a weak European market for business package deliveries.

"There is no regulatory risk whatsoever," said Kepler Cheuvreux analyst Andre Mulder of the

proposed FedEx deal, calling the offer fair in view of TNT's weaker market position. "FedEx

made a smart move and their rivals can do virtually nothing," he added.

FedEx's decision to bid followed a 17 percent drop in TNT shares over the past year, versus

a 21 percent rise in the benchmark Dutch AEX index. A stronger U.S. dollar against the euro

will also have worked in the U.S. firm's favor. TNT warned in February it expected tough

trading to continue in its main western European markets.

[Reuters]

Italian coastguard and navy rescue 1,500 migrants off Libyan

coast

07/04/2015

The Italian coastguard and navy have rescued around 1,500 migrants from five

boats in the southern Mediterranean after the vessels got into trouble off the

coast of Libya.

According to officials, the migrant were trying to cross the sea to reach Italy, BBC News

reported. In five separate operations, navy and coastguard ships rescued the people in

under 24 hours.

Vessels were despatched after satellite telephone distress calls were received from three

migrant boats. Four coastguard vessels and one from the navy were also involved in the

operation. The Italian coastguard said the migrants were transferred to Lampedusa Island

and the ports of Augusta and Porto Empedocle in Sicily, the news agency reported.

"Libya's proximity to Italy has made the country's coast a preferred transit route for illegal

attempts to reach the European Union." The political crisis in Libya has increased the

numbers of both migrants and asylum seekers crossing Mediterranean Sea to reach Europe.




Libya's proximity to Italy has made the country's coast a preferred transit route for illegal

attempts to reach the European Union (EU). Earlier this year, the Italian coastguard rescued

around 1,400 migrants from two vessels after the ships were abandoned by their crews.

According to the Italian Ministry of the Interior, around 3,528 migrants have crossed the

Mediterranean in January this year, regardless of severe winter conditions. In March,

European Union law enforcement agency Europol launched Joint Operational Team (JOT)

Mare, in a bid to combat irregular crossings of the Mediterranean Sea.

[Ship Technology]

Plastic polluting oceans kills sea life, becomes part of marine

ecology

06/04/2015

8.8 million tons of plastic polluting oceans every year

Boobies, like albatrosses, can be forgiven for feeding plastic to their chicks because they

think it’s just another nourishing bounty from the sea. Turtles make the same mistake,

believing floating plastic bags are delicious jellyfish. So the guts of these birds and animals

get clogged with our indigestible garbage. Many die of digestive obstruction and starvation.

Whether we can be forgiven is quite another matter. We made the plastic, concocting it

from petroleum by elaborate alchemic processes that render the stuff almost indestructible.

We produce and use millions of tonnes of it per year, then discard it with the same

profligacy. It litters our beaches, in some parts of the world piled high like driftwood. In the

oceans it collects and floats in country-sized gyres, great abnormal and proliferating

ecologies that become toxic platforms for opportune organisms to inhabit.

A study led by Jenna Jambeck of the University of Georgia, published in the February 2015

edition of the journal Science, calculated that of the nearly 300 million tonnes of plastic now

produced annually by the world’s 192 coastal countries, an estimated 8.8 million tonnes

ends up in the world’s oceans. While most of this marine pollution comes from Asian

countries – some of their rivers are used as disposal systems so just throw the plastic into

the current and it gets flushed away to some unknown destination – England’s Thames also

carries worrisome amounts of plastic. Another study estimated that about one billion

microplastic pieces reach the Pacific each day from Southern Californian cities.

The several monstrous gyres of floating plastic recently identified account for only some of

this debris. According to the Jambeck study, about “99 per cent of the ocean’s plastic is

missing” – it simply disappears somewhere into the marine ecology. Some of it is known to

sink, becoming part of a “plastisphere” inhabited by crabs, shrimps and other creatures.

Some of it gets fused with sand and stones to become a new kind of rock called

“plastiglomerate”. Some is slowly ground into microparticles by the action of currents, wave




and tides, ready to be eaten and incorporated into the food chain. We have made about six

billion tonnes of plastic since 1950, with most of it being discarded and added to the

environment.

To give some sense of the 8.8 million tonnes of almost indestructible plastic contaminant

being added to the oceans each year, Jambeck explained that it’s the equivalent of five

grocery bags full of plastic debris dotting each foot of shoreline around the world’s coastal

countries. The problem was first identified in the 1970s when about 0.1 per cent of plastic

production was getting into the oceans; the rate may now be as high as 4.5 per cent. And

this doesn’t account for the whereabouts of the rest of the plastic, much of which is not

recycled. We are engaged in an irreversible polluting process of such magnitude that it can

only be summarized as obscene.

The old adage is true that we can never throw anything “away” because there is no “away”

to throw it. Earth is a single ecology, and the only one we have. If we poison or despoil it,

we don’t have another. And the evidence is that our wayward and lackadaisical relationship

with plastic is returning to haunt us. Indeed, “The future is plastic”. But, whereas this

prediction was once understood in glowing economic terms, it can now be understood in

ominous ecological terms.

Almost no beach or ocean on the planet is free of discarded plastic. It can be found as

microparticles in the sand on the Maltese Islands of the Mediterranean and the remote

Canary Islands of the Atlantic, and on the beaches of the Northern Pacific from Vancouver

Island to Haida Gwaii.

Studies in the Baltic Sea indicate that zooplankton ingest microplastics, which are then

ingested by shrimps, clams, mussels and other larger feeders. The ocean surrounding

Australia has measurable quantities of microplastics with a median length of 2.8 mm, broken

down from mostly packaging made of polyethylene and polypropylene. Similar

concentrations are found in the Caribbean. No ocean in the world is exempt from plastic

contamination. The ocean and beaches of the Pacific Northwest, for example, contain

measurable amounts of polystyrene components: styrene monomer, styrene dimers (2,4-

diphenyl-1-butene and 1,3-diphenyl propane), and styrene trimer (2,4,6-triphenyl-1-

hexene).

In a 2014 study from the University of Victoria on microplastics in seawater along BC’s

coast, the researchers found up to 9,180 pieces per cubic metre in some locations – each

piece about the size of a coffee ground. Concentrations were usually higher closer to urban

centres. The Strait of Georgia, for example, averaged 3,200. Because of tides, currents and

weather, the highest average concentration was in Queen Charlotte Sound, with 7,630. The

average for all Vancouver Island waters was 2,080 pieces per cubic metre. The study

provides photographs of small copepods with pieces of ingested microplastics in their

bodies, the first step in the migration of these wastes up the food chain to us.




As we dine on seafood and behold the wonders of our plastic future, we can revel in the

praise we lavish on our ingenuity, and cringe at the censure we deserve for our foolishness.

[Beacon News]

Greenpeace activists board Shell Arctic offshore drilling rig

06/04/2015

Six Greenpeace activists protesting Shell Arctic offshore drilling on Monday

boarded a drill rig as it was transported across the Pacific Ocean toward Seattle,

where it will be staged for drilling on Shell leases in Alaska waters.

Photo: Vincenzo Floramo / Greenpeace

The 400-foot Polar Pioneer, owned by Transocean Ltd., was on board a heavy-lift vessel

about 750 miles northwest of Hawaii when the activists approached in inflatable boats and

used climbing gear to get on board, Greenpeace spokesman Travis Nichols said.

They plan to unfurl a banner in protest of Arctic offshore drilling but have no plans to

interfere with the ship’s navigations, he said. “All six people on the ship are experienced

climbers in their normal daily lives and have the professional training and equipment needed

to climb on to the rig safely without interfering with its operation,” Nichols said by email.

Shell USA spokeswoman Kelly Op De Weegh said by email that Greenpeace protesters

illegally boarded the vessel, called the Blue Marlin, jeopardizing their safety and that of the




crew. She said Royal Dutch Shell PLC has met with groups that oppose energy exploration in

Alaska waters.

“We respect their views and value the dialogue,” Op De Weegh wrote. “We will not,

however, condone the illegal tactics employed by Greenpeace. Nor will we allow these

stunts to distract from preparations underway to execute a safe and responsible exploration

program.”

Petty Officer Third Class Melissa McKenzie of the Coast Guard’s 14th District in Honolulu

confirmed the Coast Guard received word from Blue Marlin crew members that a group had

boarded the vessel. The office did not receive a request for assistance.

The Polar Pioneer left Malaysia in early March. It is one of two drill rigs Shell hopes to use

for exploratory drilling during the summer open water season in the Chukchi Sea off Alaska’s

northwest coast if it can obtain all necessary permits.

Shell last drilled in Arctic Ocean waters in 2012. Using two vessels, the company drilled pilot

holes and performed other preliminary work in both the Chukchi and the Beaufort seas.

Shell was prohibited from drilling into oil-bearing rock because it did not have required

response equipment on hand.

The company experienced problems in the challenging conditions, culminating with the drill

vessel Kulluk, which was used in the Beaufort Sea, running aground near Kodiak when it

broke loose from its tow vessel.

The company hired by Royal Dutch Shell PLC in 2012 to drill on petroleum leases in the

Chukchi, Sugarland, Texas-based Noble Drilling U.S. LLC, in December agreed to pay $12.2

million after pleading guilty to eight felony environmental and maritime crimes on board the

Noble Discoverer. That rig is the second one Shell intends to use this year if it obtains the

necessary permits.

Arctic offshore drilling is bitterly opposed by conservation groups that claim oil companies

have not demonstrated they can clean up a major spill in ocean water choked with ice. They

also say the leases are far from infrastructure such as Coast Guard bases, deep-water ports,

major airports and other resources that could be of use in a spill.

Nichols said the six activists have the training and experience to carry out the protest safely.

They hope to unfurl a banner containing the names of millions of people from around the

world who oppose Arctic drilling, he said.

The activists are carrying several days’ worth of supplies. “The most dangerous thing about

this rig isn’t the Greenpeace climbers,” Nichols said. “It’s the reckless drilling Shell wants it

to start this summer in Alaska’s Chukchi Sea, where an accident would be impossible to

clean up and devastate the delicate Arctic environment.”




The activists launched their inflatable boats from the Greenpeace ship Esperanza,

Greenpeace said in an announcement. The six protesters are from the United States,

Germany, New Zealand, Australia, Sweden and Austria.

Greenpeace has targeted Shell before. In February 2012, actress Lucy Lawless and seven

other activists with the organization climbed a drilling tower on the Arctic-bound Noble

Discoverer while it was in port in New Zealand. Lawless spent four days atop the 174-foot

tower, camping and blogging about her experiences. The oil-exploration protest briefly

delayed the ship’s voyage. Lawless later pleaded guilty to trespassing.

In March 2012, Greenpeace activists boarded two Shell-leased ice-breakers in Helsinki,

Finland. Greenpeace said Shell leased the icebreakers for support of Arctic offshore drilling.

Shell later obtained a U.S. federal court injunction that ordered Greenpeace USA to stay

away from its drill rigs destined for the Arctic through October 2012.

[The Canadian Press]

Pakistan: LNG import terminal opened in Port Qasim

06/04/2015

On March 28, 2015, officials from Engro Corporation, Excelerate Energy and the

Government of Pakistan were present for the inauguration of Pakistan's first LNG

import terminal in Port Qasim.

Located in a channel of the Indus River east of Karachi, the terminal is a result of a fast-

track LNG import solution built to alleviate the energy shortage facing the country, and was

brought into service 11 months from the start of construction. Utilizing Excelerate's floating

storage and regasification vessel (FSRU), the Exquisite, the facility has the capacity to

deliver up to 690 MMcf/d of natural gas directly to Sui Southern Gas Company's natural gas

pipeline system.

As part of the commissioning process, Exquisite loaded its first LNG cargo in Ras Laffan,

Qatar, on March 24, 2015. After arriving in Port Qasim on March 27, the terminal completed

commissioning activities and regasification acceptance test in less than three days, allowing

the Exquisite to enter commercial service by March 31, 2015.

The LNG Terminal in Port Qasim is the ninth floating regasification terminal developed by

Excelerate directly or in collaboration with its partners and customers.

[MarineLink]




U.S.: Million barrels of crude oil shipped by rail per day

06/04/2015

More than 1 million barrels of crude oil move by train across the United States

every day, according to data published for the first time by the government.

The volume of crude shipped by rail has increased more than 50-fold in five years, from just

630,000 barrels in January 2010 to 33.7 million barrels in January 2015, the Energy

Information Administration (EIA) revealed in its first monthly report on movements of oil by

rail.

Until now, information on oil shipments has been incomplete, partly confidential and

scattered across a number of sources. The Association of American Railroads, individual

railroad companies, and the federal government’s Surface Transportation Board, which

regulates freight rates, have all published limited data on shipments.

The EIA has now brought together the confidential data from the U.S. Surface

Transportation Board and Canada’s National Energy Board as well as its own information on

production and stocks in each part of the United States, to produce the first comprehensive

picture of crude-by-rail movements.

The data underscore how rapidly the modern oil-by-rail business has grown. Shipments rose

from almost zero in 2008 to hit 1 million barrels per day (bpd) for the first time in the

current boom in April 2014.

Rail shipments are running at the highest level since the Second World War, when oil was

shifted from tankers to railcars to avoid being sunk by submarines (“Fightin’ Oil”, 1943).

Railroads have become an essential part of the American energy revolution. Without the

massive unit trains hauling 100 tank cars or more loaded with crude from the shale fields to

refineries, U.S. crude production could not have grown so quickly over the last five years.

According to the EIA, railroads moved 10 percent of all U.S. oil production in January 2015,

and 40 percent of production from states in the Midwest such as North Dakota, Colorado

and Wyoming.

The main consumers were refineries in Pennsylvania, New Jersey and Delaware, which

accounted for almost half of the oil shipped by rail at the start of this year.

Crude-by-rail has become essential to East Coast refiners. Railroads delivered almost half

the crude processed by East Coast refineries at the start of 2015, according to an analysis of

EIA data.




Smaller quantities of oil were delivered to refineries in California and on the Gulf Coast in

Texas and Louisiana, where crude-by-rail is more marginal to refinery operations

(link.reuters.com/fav44w).

The surge in crude-by-rail explains why both the railroads and oil shippers were slow to

appreciate the risks involved in carrying large volumes of oil in unit trains. Because so little

oil was transported by rail prior to 2011 or even 2012, there was not much statistical

information on the risks involved in carrying oil in unit trains.

The risk of derailments and train fires was always present but hidden and not appreciated

because there were so few crude carrying trains.

The danger has only become apparent when the size of the business was scaled up by more

than an order of magnitude. It is a familiar problem with new technologies or technologies

which undergo rapid growth (“Normal Accidents: Living with High-Risk Technologies” 1999).

But crude-by-rail has become so central to the U.S. oil business that the industry has

struggled to formulate an appropriate safety response—even as the risks have become

increasingly evident following a string of devastating train fires.

The industry is torn between fear of a catastrophic train fire in a major urban area that

could cause mass casualties and cost billions of dollars in compensation and clean up, and

the need to fight or delay tougher safety standards which could restrict the availability of

tank cars and disrupt the increasingly vital flow of oil by tank car.

Negotiations between the railroads, oil producers, refiners and the U.S. government about

new crude-by-rail regulations and tank car safety standards boil down to the question of

how to balance the safety imperative of withdrawing older and less secure tank cars as soon

as possible against the commercial imperative of keeping them in service for longer to

maintain tank car availability and keep the oil flowing.

[Reuters]

Costa Rica: Terminal de Contenedores de Moín inicia con obras

por $663 millones

06/04/2015

APM Terminals reporta fluido arranque de construcción de primera etapa de

megaterminal portuaria

El 19 de enero arrancó la construcción de la primera etapa de la Terminal de Contenedores

de Moín (TCM) que implica la inversión de $663 millones. La suma equivale a más del 66%

de los $1.000 millones que costará en total el proyecto de concesión de obra pública más

ambicioso que ha echado a andar Costa Rica en su historia.




La empresa concesionaria de la obra, la holandesa APM Terminals, informó que el proceso

de construcción avanza sin ningún contratiempo y se encamina a tener en operación el

megapuerto dentro de 36 meses, tal como lo exige el contrato de concesión.

El calmo panorama contrasta con la polémica que ha despertado el proyecto desde sus

inicios y la oposición férrea que ha mantenido el Sindicato de Trabajadores de Japdeva. Esta

organización interpuso varios recursos legales para impedir el desarrollo de la concesión.

Los esfuerzos han sido, hasta el momento, infructuosos y el contratista Van Oord and BAM

ya empezó a levantar sus campamentos en Moín, Limón.

Esta empresa holandesa se encargará de la construcción de un rompeolas de 1.500 metros

de largo y de darle forma a una isla artificial a 500 metros de las costas limonenses, donde

se construirá la TCM.

Dragado listo para iniciar

El consorcio, que empleará a 700 trabajadores durante la primera fase del proyecto,

también construirá la ruta de acceso desde tierra hasta la isla de 40 hectáreas.

El secretario técnico del Consejo Nacional de Concesiones (CNC), Jorge Mora, explicó al

diario La Nación que en la primera etapa de construcción del megapuerto principalmente se

nota el trabajo de los topógrafos y de los transportistas de materiales que darán forma al

muelle.

Una de las primeras tareas que iniciará Van Oord and BAM será el dragado del canal

marítimo de acceso a la megaterminal. Paul Gallie, director general de APM Terminals para

Centroamérica, afirmó que el proceso de dragado del canal de acceso a la TCM se iniciará

esta semana. Gallie añadió que está por llegar al país la primera de las dragas que dará

profundidad al canal de acceso. La maquinaria proviene de México.

La profundidad del canal será de 16 metros y permitirá el ingreso de buques

portacontenedores de la categoría panamax capaces de transportar desde 4.500 hasta

7.500 TEU (aproximadamente 8.500 contenedores). En futuras fases de expansión la TCM

podrá dar servicio a barcos de hasta 13.000 TEU.

Los actuales muelles, operados por la Junta de Administración Portuaria y de Desarrollo

Económico de la Vertiente Atlántica (Japdeva), cargaron y descargaron 1,05 millones de

TEU durante el 2013 y tienen capacidad para atender buques de hasta 2.500 TEU.

El material que se extraiga durante el proceso de dragado se utilizará para construir la isla

artificial donde se desarrollará la TCM, que tendrá 1.500 metros de longitud de atraque,

divididos en cinco puestos con seis grúas pórticas post panamax.




Gallie aseguró que el inicio de la primera etapa de construcción de la TCM estuvo precedido

por más de 100 perforaciones del lecho marino que dan certeza sobre el terreno en que se

desarrollará el proyecto.

En cuanto a la paralización de la extracción de material rocoso del Tajo Asunción, ubicado

en Limón, a raíz de investigaciones por presunto daño ambiental, Gallie dijo que el hecho no

ha perjudicado el avance de las obras. El director agregó que Van Oord extrae material de

otros cinco tajos, sin que el transporte de los insumos desde otras zonas implique un

aumento en los costos. Esos materiales se transportan a través de la ruta 257, un camino de

lastre de 2,8 kilómetros de largo que comunica la TCM con la ruta 32.

[El Financiero]

Canada: East coast ports target rising container business

06/04/2015

On the container shipping scene, in particular, at Canada’s east coast ports,

Montreal clearly has the wind in its sails, Halifax is soldiering on to capitalize on

its deep waters, and Saint John is seeking to bolster its status as a relatively

small player by pitching for significant capacity expansion to accommodate

larger vessels.

Apart from consolidating existing markets and developing new markets, a common

denominator is the exploration of potential enhanced maritime trade opportunities offered

by congestion issues in US ports.

Coming off a record year in total cargo (30.4 million metric tones) and container throughput

(1.4 million TEUs), the Port of Montreal, a big factor in the North Atlantic container trade,

has entered 2015 almost like a roaring lion – on both the traffic and infrastructure fronts.

Despite the harsh winter and heavy ice conditions on the St. Lawrence River, the growth

pattern was continuing unabated in the early months of this year. The global carriers calling

at Montreal specially equip their vessels with ice-reinforced hulls.

“All our markets are up, including in the Midwest,” reported Tony Boemi, vice-president

growth and development for the Montreal Port Authority. “With the low Canadian dollar,

exports are increasing to Europe, the Mediterranean and Asia,” Boemi told AJOT.

In January, the port received federal government funding of nearly C$44 million in support

of infrastructure development projects estimated at C$132 million for boosting container-

handling capacity in the Viau sector, deepening vessel berths, and improving truck traffic

flows.




Subsequently, Termont Montreal Inc. terminal, a joint venture of Logistec Corporation and

Cerescorp, signed a long-term lease in late March with the Port of Montreal to operate the

new Viau container terminal. The biggest customer of Termont, MSC is a key partner in the

Viau project scheduled to open in the fall of 2016.

Montreal capacity heading towards 2 million TEUs

The redeveloped site will include a full-service berth for container vessels, two post-

Panamax cranes, a modern automated truck-marshalling yard, an intermodal service using

on-terminal rail operations, and a high-density container yard. Upon completion, the Viau

terminal will boost the Port of Montreal’s capacity to 2.1 million TEUs.

Commented Madeleine Paquin, president of Logistec: “The new Viau terminal will provide

Termont with the additional space it needs to deliver quick turnaround times and efficient

cargo-handling services to the Port of Montreal’s current and future customers, and thus

support MSC as it continues to grow its services through the Port of Montreal.”

In another important development in March for the future of the Port of Montreal, a

Canadian consortium led by Fiera Axium Infrastructure announced the purchase of Montreal

Gateway Terminals (MGT) – largest container operator in Montreal – from Morgan Stanley

Infrastructure Partners (see separate report on page 2).

Meanwhile, at the Port of Halifax, a current major focus is to develop a stronger distribution

network, affirms George Malec, vice-president of business development and operations.

“This is supported by over $100 million in infrastructure investment since 2011 that is being

used to develop trade. We see opportunities on the horizon with CETA (Canada-European

Union free trade agreement) and the overall move to larger vessels.”

Last year, the Nova Scotia deep-water port saw its container volume advance by 8.6%,

which translated into 400,000 TEUs. Completed deepening of the berths at the two

container terminals means the port can handle the largest container ships calling on the east

coast.

Good news also came this past February when Eimskip decided to increase the number of

annual calls it makes at Halterm Container Terminal from 13 to 31. Originating in Reykjavik,

Eimskip vessels then travel to Argentia, Newfoundland, and Halifax before going to Portland,

Maine in a shortsea connection increasing shipper options for the US and Europe.

Saint John eyes bigger box role

”For its part, the Port of Saint John submitted a C$205 million application to the federal

Building Canada Fund, National Infrastructure Component, to upgrade its container facilities

over the next seven years to meet demand. The Port and the New Brunswick government

would participate in the proposed partnership.




“Our container traffic has almost doubled since 2012,” says Jim Quinn, President and CEO of

Port Saint John. “To continue competing and growing on the world stage a terminal upgrade

is required to accommodate larger vessels and to have the handling capability required to

service modern fleets.”

In recent years, the port’s mainly north-south container orientation with Latin America,

through notably Tropical Shipping, has broadened to wider global markets thanks to the

arrival of Mediterranean Shipping Services (MSC). Several decades ago, Saint John’s

container business was hit hard by the departure of various Far East carriers. Last year

marked the first full year of MSC calling Saint John, and carrier increased its presence last

spring with additional vessels calling at Rodney Container Terminal.

“We all have been working hard with stakeholders, our province and our local MP Rodney

Weston to get the port back on the map,” says Quinn. “We have doubled our container

traffic, going from an average of 45,000 TEU’s in the past decade to almost 90,000 TEU’s in

2014, with projections to be over 100,000 TEU’s in 2015. We also know that US ports are

becoming more and more congested.”

With shippers and receivers looking for eastern seaboard options, Quinn feels that the Port

of Saint John can be part of the solution once its facilities are upgraded to handle the larger

box ships.

[AJOT - American Journal of Transportation]


port & shipping news 15/15

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