Friday, 02 June 2017 13:29

Dakota Access Pipeline operational

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The $3.8 billion US Dakota Access pipeline began shipping oil for customers on Thursday while the developer will face scrutiny later this summer over whether it violated North Dakota rules during construction.  Dallas-based Energy Transfer Partners announced that the 1,931-kilometres line carrying North Dakota oil through South Dakota and Iowa to a distribution point in Illinois had begun commercial service. Dakota Access and the Energy Transfer Crude Oil Pipeline from Illinois to the Gulf Coast together make up the $4.8 billion US Bakken Pipeline system, which ETP said has commitments for about 520,000 barrels of oil daily.

Friday, 02 June 2017 13:11

Rickmers files for insolvency

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German shipping group Rickmers has filed for insolvency under self-administration to Hamburg District Court with the aim of restructuring after bondholder HSH Nordbank rejected its restructuring plan a day ahead of a last-ditch bondholders' meeting.  Rickmers had proposed a revamp plan under which the equity stake of owner Bertram Rickmers was to be reduced to 24.9 percent, while bondholders, HSH Nordbank and potentially another bank would hold 75.1 percent. The Executive Board remains in office and capable of acting. The necessary legal expertise will be provided by experienced Hamburg restructuring expert, lawyer and tax adviser, Dr Christoph Morgen. The aim of the Executive Board is to work out a new restructuring solution together with the creditors and making use of the tools of insolvency law. Banks, bondholders and the workforce will be represented on a temporary committee of creditors. Rickmers' loss more than doubled to $383 millionin 2016, amid overcapacity in the market and falling freight rates.

Friday, 02 June 2017 13:04

Panama Canal proposes toll changes

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The Panama Canal Authority (PCA) has published a proposal to amend the Panama Canal Tolls system which has been in place since April 2016.  If passed, the proposals will be implemented on 1 October 2017 following three months notice.  Only three sectors are affected by the proposed changes: Containerships, Container/Breakbulk vessels and LPG/LNG vessels.  For the containership segment, the proposal offers more attractive rates per loaded containers on the return voyage, applicable only to those Neopanamax vessels deployed on the Canal route in the head and back haul legs, and when: (1) the utilization rate of the northbound transit is higher or equal to 70 percent, and (2) the time lapse between the northbound and the southbound transit is not greater than 25 days. In order to promote the use of the services provided by the local transportation hub, any additional days that the vessel requires to perform port-related activities in the Panamanian terminals will not add to the 25 day period.  Tolls for all other sectors will remain as implemented in April 2016. The usual 30 day public consultation period has now begun and written comments must be received by the PCA by July 3 and this will be followed by a public hearing is scheduled for 5 July.  

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Hapag-Lloyd is looking to cut up to 12 percent of its almost 11,000 land-based workforceover the next 18-24 months following the completion of its merger with UASC.  Downsizing of the workforce will not affect its 2,100 member crew.   Hapag-Lloyd now plans to combine its 118 services with the 45 services making up UASC’s network, a process estimated to start in roughly eight weeks, taking up to the end of the third quarter.  The combined fleets will include 230 vessels with a shared capacity of approximately 1.6 million TEUs.


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Teekay Tankers Ltd. has agreed to acquire all the remaining issued and outstanding shares of Tanker Investments Ltd. (TIL) in a share-for-share merger creating the world's largest publicly-listed mid-sized conventional tanker company. The acquisition of over $500 million of modern tankers, results in combined total assets of $2.4 billion.  TIL's fleet consists of 10 Suezmax tankers, 6 Aframax tankers and 2 LR2 Product tankers with an average age of 7.3 years. Following the merger, Teekay Tankers' fleet will consist of 62 conventional tankers, including 3 in-chartered conventional tankers (30 Suezmax tankers, 22 Aframax tankers, 9 LR2 Product tankers and one 50 percent-owned VLCC).  

As part of the transaction, Teekay Tankers will assume approximately $350 million of TIL's long-term debt, which includes two revolving credit facilities and a term loan, and on a pro forma basis as of March 31, 2017, the transaction adds approximately $117 million(1) of liquidity to Teekay Tankers. Once finalized, the acquisition will lower the average fleet age, reduce the financial leverage and increase the total liquidity position. In addition, with the acquisition of the remaining interest in Teekay Operations for approximately $27 million, Teekay Tankers has now completed its evolution into a fully-integrated conventional tanker platform with all management and operations now owned and operated solely by Teekay Tankers.

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Coinciding with the Vancouver Fraser Port Authority's Annual General Meeting held on May 30th, the Port released its 2016 economic impact study and sustainability report which together describes how economic, environmental and social sustainability are being addressed and measured.  Compared with the last report in 2012, the economic output from activities of the Port of Vancouver in 2016 increased by $4.2 billion to $24.2 billion with a 17 per cent increase in jobs across Canada from 98,800 to 115,300 jobs.  

Shown above are the 2016 Blue Circle Award recipients with VFPA President and CEO, Robin Silvester.  Receiving the awards presented at the AGM were representatives from: CMA CGM, Hamburg Sud, The China Navigation company, Hapag Lloyd, Hyundai Merchant Marine, Evergreen Line, United Arab Shipping Company, “K” Line, Mediterranean Shipping Company, NYK Line, Disney Cruise Line, Princess Cruises, Grieg Star, Westwood Shipping Lines, and Yang Ming.

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Green Marine marked its 10th anniversary as North America’s environmental certification program for the maritime industry this week with its GreenTech 2017 conference in Fort Lauderdale. Released at the event was the 2016 environmental performance results of Green Marine members showing continuous improvement throughout even with the recent introduction of new indicators and tougher criteria for the existing indicators. West coast ship operators, ports and terminals results are positive and prominent for 2016.  BC Ferries’ fleet maintenance unit received its first Green Marine certification this year.  While BC Ferries' vessels vessels and terminals have been Green Marine certified since 2015, the shipyard certification is a new achievement, showing their commitment to continue to benchmark environmental performance and make continuous improvements.

The 2017 voluntary environmental program has 12 performance indicators that address environmental issues such as air polluting emissions, greenhouse gases, aquatic invasive species, waste management, community impacts and underwater noise.


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Upon completion of the Kinder Morgan Canada's IPO, the investment decision on the Trans Mountain Expansion Project was finalized.  The final investment decision to proceed with the Trans Mountain Expansion Project triggers a number of important next steps including the finalizing of construction contracts and the actualization of the financial, employment and safety benefits the company has committed to through more than five years of engagement and consultation.

The final investment decision means that investments in safety, jobs, the environment and communities will commence including:

  • Once in service, annual payments to the Province of B.C. for the B.C. Clean Communities Program for local, environmental projects
  • Mutual Benefits Agreements payments and opportunities for Aboriginal communities in B.C. and Alberta
  • Investments to Western Canada Marine Response Corporation for five new response bases, vessels and more than 100 new employees
  • Contributions for communities along the pipeline through Community Benefits Agreements for local projects

Construction is set to begin in September 2017 and the Project is expected to be placed in-service by the end of 2019.

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The Minister of Fisheries and Oceans, the Honourable Dominc LeBlanc was in Victoria earlier this week to announce further commitments under the Oceans Protection Plan by the federal government, including:

  • $75M five-year national Coastal Restoration Fund to support habitat restoration priorities and address threats to marine species;
  • $101 M over 5-years, plus $12.2M on-going for new lifeboat stations in Victoria, Hartley Bay, Port Renfrew and Nootka Sound, plus three in Newfoundland and Labrador;
  • 24/7 emergency management and response capacity within the Regional Operations Centres; and 
  • $6.85 million over five years to the Abandoned Boats Program led by Transport Canada of which $1.3 million will go toward the removal of vessels of concern.

The Minister also announced an additional $1.4 billion commitment to rehabilitate the Department of Fisheries and Oceans and the Canadian Coast Guard.  These funds which will complement the $1.5 billion allocated to the Oceans Protection Plan, a significant portion will enable the Canadian Coast Guard to increase its staff across Canada by 15 per cent and upgrade its fleet, and investments in communications equipment and technology.  Fisheries and Oceans will benefit by better research in ocean science, thereby providing better data for policy development.

Thursday, 01 June 2017 09:25

Pilotage Act Review

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On May 31, 2017, the Government of Canada announced plans to move forward with the Review of the Pilotage Act. This Review will support the delivery of safe, efficient and environmentally responsible marine pilotage services into the future. It is also part of the Government’s comprehensive Oceans Protection Plan.

The scope and mandate of the Review

  • The Review aims to modernize the Pilotage Act while keeping elements that support Canada’s excellent pilotage safety record.
  • The Review will be led by Mr. Marc Grégoire and supported by Transport Canada. Mr. Grégoire is a former Commissioner of the Canadian Coast Guard.
  • The Review will address a wide range of topics under six themes, drawn from advice that stakeholders provided in recent consultations. Topics will include service delivery, governance, dispute resolution and safety.

The Terms of reference: Pilotage Act Review covering the Review’s scope, mandate and key principles are now available.


Thursday, 01 June 2017 09:15

No plans to deepen Fraser River

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The Vancouver Fraser Port Authority has announced that it has no plans to further deepen the Fraser River to accommodate larger vessels as it, together with existing marine terminal properties and port industrial lands, can sufficiently handle Canada’s trade for the foreseeable future. 

The port authority continuously monitors trends in global ship sizes relative to the size of vessel that can be accommodated. Commercial ships are increasing in size because it is more economical and environmentally responsible to run larger vessels. However, there are limitations to the Fraser River that restrict its ability to accommodate larger ships including height, depth and width restrictions.

Recently, the Vancouver Fraser Port Authority completed an analysis of the Fraser River and its potential to accommodate increasing trade. The analysis considered a variety of possible uses of existing port lands and assessed dredging the river at different depths, and it was determined that deepening the Fraser River would be extremely costly, requiring extensive environmental study and consultation over many years.

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According to American Shipper, the American Association of Port Authorities (AAPA) has expressed concern over declines in various federally funded, port-related programs in President Donald Trump’s fiscal 2018 budget request, which was transmitted to Congress Tuesday.  The budget proposal for next year includes the elimination of the U.S. Department of Transportation’s (USDOT) Transportation Investment Generating Economic Recovery (TIGER) grant program, and a 52 percent reduction in funding for the Department of Homeland Security’s Port Security Grant Program (PSGP) to $47.8 million. In fiscal 2017, the PSGP provided 35 port security related grants, and the TIGER grants program awarded $61.8 million in multimodal infrastructure grants to US ports.  The AAPA is calling for $66 billion in federal funds for port-related infrastructure over the next decade to ensure U.S. job creation, economic growth, safe and secure ports, and tax fairness.

In addition, President Trump has proposed cutting the Environmental Protection Agency’s (EPA) budget by 31 percent, while the EPA’s Diesel Emissions Reduction Act (DERA) grants would see an 83 percent cut.

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