Both hard and digital copies of the latest British Columbia Ports Handbook are now available. The pdf version can be downloaded from our website at www.cosbc.ca and hard copies can be picked up at our office. Advertising opportunities are still available for the digital version which will be updated regularly.
This week’s 39th annual Interferry Conference held at the Westin Bayshore was successful in attracting over 300 delegates from across the globe. Presentations and panels included discussion of the regulatory burden, the lack of appreciation for short sea shipping at the IMO, retail and customer service strategies, the human side of safety and the move towards LNG as a primary fuel in the ferry industry. Next year’s conference is to be held in the bicycle capital of the world – Copenhagen.
The BC legislature is in session until November 27 for the primary reason of passing legislation on taxation and environmental policies for the emerging LNG industry. The tax plan announced earlier this year calls for a two tier tax system that would apply a manufacturing tax on LNG production, the first level being at 1.5% as soon as production starts and the second level at 7% once investment costs from construction of the terminal have been recovered. Petronas, the lead partner in Pacific Northwest LNG has been pressing for both the federal and provincial governments to commit to lower taxes by the end of October to meet its mid-December target for an investment decision.
The head of the recently formed 15 member LNG Alliance, Mr. David Keane, a former executive for BG Group, also commented this week that "the industry, if they're going to invest billions of dollars, needs clarity and certainty around the fiscal structure." The Alliance members include Kitimat LNG, LNG Canada, Pacific Northwest LNG, Prince Rupert LNG, Woodfibre LNG and Triton LNG.
Steelhead LNG Corp owned by the Huu-ay-aht First Nations has recruited Mr. Victor Ojeda who had previously been leading the development of Shell’s LNG Canada project in Kiitmat. The project has applied for a 30-year LNG export license to develop a plant near Bamfield near Port Alberni. Mr. Ojeda has more than 20 years of experience in developing multi-billion dollar energy projects across Africa, the Americas and Oceania.
Port Metro Vancouver’s unique Container Vessel On Time Performance Incentive Program has been awarded the CIFFA “Forwarders Celebrating Associates” award for Excellence in Innovation. The program recognizes container vessel operators that arrive within +8 hours of their berth window which in 2013 resulted in a 10% increase in vessel on time performance. The program paid out $2.8 million in wharfage reductions to ten qualifying carriers in 2013.
In a surprise move, the Seattle and Tacoma port commissions have this week announced plans to unify management of the two ports under a single “Seaport Alliance” in an effort to compete more effectively with their neighbours. The Alliance will manage marine cargo terminal investments and operations, planning and marketing, while the individual port commissions will retain their existing governance structures and ownership of assets. Following due diligence period, the two commissions intend to submit a more detailed agreement to the FMC by the end of March 2015. During the due diligence period, John Wolfe, Port of Tacoma CEO, and Kurt Beckett, Port of Seattle Deputy CEO, will continue to lead their respective ports with Mr. Wolfe expected to emerge as the unified CEO.
The Federal Maritime Commission (FMC) held hearings last week in Baltimore with a view to gaining a better understanding of the reasons for the acute container handling congestion impacting some U.S. ports. The FMC heard a number of explanations including the domino effect of shippers unwilling to pay higher rates, ocean carriers seeking to reduce costs by building larger and more fuel-efficient ships, in turn demanding lower handling rates from terminals. The terminals themselves are then struggling to finance the capital needed for investments needed to efficiently handle the bigger ships while everyone is piling pressure on the truckers. Also highlighted was the problem of holds placed on containers for inspections by U.S. Customs and Border Protection at a time when budget restrictions have stretched CBP’s staff too thin to keep up with increased volume. Trucking companies also warned that truck drivers are leaving the business because of increasing difficulty earning a living. Does any of this sound familiar?
A battle royale is taking shape ahead of next week’s 67th meeting of the IMO’s Marine Environmental Committee (MEPC) in London The International Chamber of Shipping estimates that ship owners are being pressed to invest around $US100 billion in new ballast water treatment systems once the Ballast Water Management Convention enters into force, probably sometime in 2016, but with no assurance that the new type approved systems will be viewed as fully compliant by all national governments. Also in question is the criteria to be used for sampling ballast water during Port State Control inspections, and the need for “grandfathering” of type-approved equipment already or about to be fitted.
Canada has submitted an attempted compromise proposal including the concept of “minor exceedance” of the Convention’s discharge standards but this is not considered likely to go very far. The ICS submission to MEPC 67 can be found here.
The Captain of the South Korean ferry Sewol that capsized and sank in April with the loss of 304 lives had his day in court this week. Captain Lee Joon-seok, 68, said he was in a very confused state of mind during the incident and apologized for his failure to rescue his passengers in the country’s worst maritime disaster for many decades. Captain Lee was among 15 crew members accused of abandoning the heavily listing ferry after telling the passengers to stay put in their cabins. Four, including the captain face homicide charges while a separate trial is under way for officials of the company that operated the vessel. The billionaire businessman owner of the company, went missing shortly after the disaster and was later found dead.
A Vietnamese oil tanker MT Sunrise was hijacked by around a dozen pirates less than one hour after leaving Singapore late last week destined for Vietnam. She was carrying 5,226 metric tons of oil products, about 30% of which she was relieved. This latest incident has added to S.E. Asia’s already alarming 2014 hijacking statistics.
Piracy in home waters aside, Singapore is set on further building on that country’s hugely successful construction of a maritime cluster by turning its attention to development of marine insurance and ship finance capacity. The notion of a Singapore war risk mutual is taking hold and plans are underway to establish the country as the premier ship finance centre in Asia. Kudos to Singapore for leading the way.
After a time out of four months, the next phase of the search for the missing Malaysia Airlines flight MH370 has begun in the southern Indian Ocean. A ship equipped with specialized sonar technology, the GO Phoenix, has arrived in a remote stretch of ocean where the plane is believed to have ended its flight. Using satellite data, experts have concluded that the airliner ended its journey in the Indian Ocean, north-west of Perth. Contracted by Malaysia, the GO Phoenix, began its work this week 1,100 miles off western Australia where it will tow underwater sensors over the sea floor scanning for traces of jet fuel and using sonar and video to try to locate the plane. The GO Phoenix will be joined later this month by two additional specialized ships. The head of Australia's transport safety agency, which is leading the underwater search, said he was "cautiously optimistic that the next phase, jointly funded by Malaysia and Australia, would eventually locate the plane”.
The Baltic Dry Index has again dipped below its benchmark 1000 points, closing on Thursday on 974 points compared to 1041 points last week and 1038 points the week previously. Last week’s holiday in China for National Day celebrations seems to have done shipping markets no favors at all.
Spot time charter
One week ago
Containers: The US Federal Maritime Commission (FMC) this week announced approval of the 2M Alliance between Maersk Line and Mediterranean Shipping Co. The US was the only jurisdiction in which the new alliance was required to gain formal regulatory approval, however in order to pacify shippers, the FMC is to impose reporting requirements on the two carriers in order to monitor the implementation of the agreement.
The Cereals North America 2014 conference will be heldin Winnipeg from October 28-30 with focus on key topics in North American and global agriculture, including grain market outlooks, grain transportation, and key expanding agricultural regions such as the Black Sea and Brazil. Last year over 200 people attended the conference from a broad range of backgrounds. Early-bird sign-up for the conference ends September 5 – see the registration link http://www.cerealsnorthamerica.com/register.
The Plimsoll Club's 2014 Annual Fall Banquet will be held on November 14, 2014 at the Fairmont Waterfront Hotel. Guest speaker for the evening is Paul Nicklen, acclaimed Arctic photographer as seen in National Geographic. For more information visit: www.plimsollclub.ca or call Mariam at 604-681-2351.
Coral Star is the Anthony Veder Group's first ship with LNG tanks for cargo-independent dual fuel operation and will be employed in shipping ethylene from a Sabic cracker (ethylene liquifaction plant) at Teeside in the UK to destinations in Northern Europe. Last month after making her maiden voyage from China to Zeebrugge on conventional fuel oil. she called at the port of Zeebrugge’s Euroservices Terminal to undertake LNG fuel gas trials. In recent years Zeebrugge has developed a considerable reputation for expertise in this field.
Built in 2014 by Avic-Dingheng Shipbuilding yard in Jiangsu province, PRC Owned and operated by Anthony Veder Group LOA 99.9m Beam 17m GRT 5,831 tons Capacity 4,700 CBM Propulsion: Six-cylinder in-line 34DF main engine by Wärtsilä with C/P propeller and twin six-cylinder in-line 20DF auxiliaries Sister ship: Coral Sticho
The vessel’s final commissioning was complex and was undertaken in two steps. The initial step was to condition and load the bunker tanks with LNG and secondly send gas to the engines for testing. Liquefied nitrogen was used to purge the bunker tanks (reduce O2-content) and to cool down. After cooling down to -160°C the system was filled with LNG via two trucks delivered by Gasnor in order to start up the fuel gas system and send gas towards the engines. The generated power was sent in a first step to a load bank ashore for testing and controlling. After testing all three engines, the vessel set sail to begin the serious business of shipping ethylene. Her sister ship Coral Sticho is currently on passage from China to Zeebrugge to undertake the same testing process.
The Anthony Veder Group was incorporated in 1937 as a ship owner and port agent and has been involved in all sectors of gas shipping ever since. The current fleet consists of mostly semi pressurised/ fully refrigerated gas tankers and ethylene carriers but also combined and dedicated LNG carriers.