Mexico is reported to have seized close to 120,000 tons of various minerals in storage around Lazaro Cardenas in Mexico – a port well known to be under the influence of notorious drug gangs. Illegal shipments of iron-ore from Lazaro to China has been rumored for a while. In an attempt to straighten things out, the government ordered the Mexican Navy to take control of the port last November.In April 2013 a high-ranking executive of steel maker ArcelorMittal's Mexican operations was murdered by the drug cartel Knights Templar, that pretty much runs Michoacan state, apparantly in retribution for his trying to clamp down on their activities. No arrests have been made.
Construction work is getting back into the swing this week after the Panama Canal Authority (ACP) and the consortium GUPC entered a new agreement that will involve each injecting $100m into the project . Both sides have apparently agreed to continue disputing the $1.6bn in extra costs through international arbitration.The work was originally due to finish this year on budget but cost over-runs are certain to push the final tab from $5.2bn to nearly $7bn. ACP is requiring that all work be completed by December 2015.
It has been revealed this week that what was feared to be a piracy attack on the Japanese owned VLCC Tateyama took place in the Strait of Hormuz last month. A well coordinated response was set into motion which involved naval ships and aircraft from several countries including in a very short space of time the Australian frigate HMAS Darwin and a Pakistan Navy maritime patrol aircraft. Ultimately the suspected attackers were released since there was no evidence of an intended attack despite their high speed manoeuvres around the Tateyama. The vessel was not carrying armed guards.
As tensions between Russia and Ukraine continue to simmer, Russia has scuttled a Kara-class cruiser Ochakov (above left in happier times) in the narrow channel at the entrance to the port of Novoozerne in order to blockade the Ukrainian Navy ships in port. The Russian ships towed the Ochakov into position and sank her in 9-11 meters of water (above center). Overall, Ukraines’s commercial ports are managing to function normally.
In a related move, the House of Representatives Energy and Commerce Committee has introduced bipartisan legislation to help speed up the export of US LNG to Ukraine and other East European nations, as the LNG industry becomes caught up in the international crisis over Crimea and global uncertainty related to Russian supply. The legislation is grandly titled The Domestic Prosperity and Global Freedom Act.
The Government of Canada announced today that an Order in Council has been implemented to require the both CN and CP to increase the volume of grain carried each week over the next four weeks. By week four, the combined target is to move 1,000,000 metric tonnes per week, which more than doubles the volume currently moved.
Both railways will be required to report a summary of weekly shipments to the Minister of Transport under the Order in Council under the Canada Transportation Act. The Order includes penalties for non-compliance of up to $100,000 per day.
Chamber of Shipping's Board of Directors for 2014
(photo courtesy of Dave Roels Photography)
At last week's Annual General Meeting, the membership confirmed the re-appointment of four director with expiring terms. Richard Chappell, Kim Christensen, Dave Bedwell and Gary Paulson were each elected for a further two-year term. Following the AGM, we are pleased to announce that at the directors meeting held on March 5th that the following officers were appointed:
Chair - Bruce Rothdram (Empire Shipping Agency)
Vice Chair - Dave Bedwell (COSCO Canada)
Treasurer - Dave Hill (Compass Marine Services)
Canada Stewart Energy Group Ltd. has just submitted a natural gas export license application with the National Energy Board. Stewart Energy LNG, will be comprised of floating and land-based natural gas liquefaction plants, LNG storage and marine loading facilities. Targeted annual capacity is 5 million tonnes on the floating vessel and 25 million tonnes a year from five land-based facilities. A joint venture company is expected to build a new 800 kilometer long pipeline to support he project. There are currently seven approved export licenses for LNG projects in British Columbia and four under review, including this application.
BC Ferries announced last week that Seaspan’s Vancouver Shipyards has been awarded a $15 million contract for the construction of a new cable ferry to service the Buckley Bay – Denman Island route. A Request for Proposals was issued in September 2013 to three shortlisted shipyards; two in Vancouver and one in Seattle. Bids were received in late October 2013 and reviewed by the BC Ferries’ project evaluation team. The cable ferry provides cost savings of around $2 million per year compared to the current conventional service. Key contract features:
• Guaranteed delivery date
• Milestone installation payments secured by refund guarantee
Seaspan has meanwhile withdrawn from the running to construct three intermediate sized BC Ferries leaving the work open to yards in Germany, Turkey, Norway and Poland. The workload and timescales involved in meeting NSPS related projects on behalf of the government means that Seaspan would have been unable to meet the deliverytime-lines sought by BC Ferries.
The Transportation Safety Board has released it investigation report on the Cape Apricot incident at Westshore Terminals in December 2012. The report cites that the pilot's approach to the terminal combined with the ineffective communication on the bridge and with the tugs resulted in the collision with the trestle at Westshore.
Chamber of Shipping member company Xanatos Marine of North Vancouver was successful at the Small Business BC Awards last week in being awarded Best International Trade recognition. Winners were required to prove their excellence among a group of 417 nominated businesses in nine different award categories. The majority of Xanatos Marine’s sales are international and involve providing solutions in the maritime field to governments of Indonesia, Thailand, Philippines, Nigeria, Mexico, USA, and the World Bank as well as private organizations within those countries. Recently, Xanatos Marine has been recognized as one of BC’s Top 100 Fastest Growing Companies by Business in Vancouver, was given ‘honorable mention’ by the 2013 BC Export Awards and was the recipient of Innovator of the Year by the North Vancouver Chamber of Commerce.
Several crew members have suffered minor injuries from an engine room fire aboard the Canadian naval vessel HMCS Protecteur off Hawaii. The 44-year-old supply ship was returning to its home port of Esquimalt, British Columbia when the blaze broke out Thursday night 340 nautical miles northeast of Pearl Harbour. The crew managed to put out the flames and now there is limited power on the vessel. The US destroyer USS Michael Murphy has been sent to assist Protecteur, and the Canadian vessel is expected to return to Pearl Harbor for an assessment of the damage.
The ship was carrying 279 crew, 17 family members and two civilian contractors returning to B.C. from extended operations in the mid-Pacific. Last fall the HMCS Protecteur was in a collision with the HMCS Algonquin en route to Hawaii. The HMCS Protecteur, an auxiliary oil replenishment ship, one of two such vessels in the navy that were launched in 1969, is expected to be retired in 2015.
Port Metro Vancouver this week released official cargo statistics for 2013 with new records set in overall tonnage of cargo, as well as in container and bulk cargoes. The total tonnage handled was 135 million tons, a 9% increase of over 2012, evenly split between imports and exports. Bulk cargo exports increased by nearly 11% thanks to increased coal and grain shipments whilst container volumes grew by 4% to a record 2.83million TEU. Cruise traffic increased by 22% to 812,398 passengers spread over 29 vessels. On the down side, crude oil exports were down by 5% and auto volumes decreased by 1%.
Unfortunately the first two months of 2014 have been difficult on account of the well documented weather problems in central and eastern Canada, a surge of container imports ahead of the Chinese New Year and now disruption to trucking services spearheaded by the United Truckers Associations (UTA).
A partial judgment has now been handed down in the case of the Cape Apricot which was involved in the December 2012 incident at Westshore Terminals. A federal judge has ruled against the argument presented by the parties acting for the vessel’s owner to place full liability on the marine pilot having con of the vessel at the time. Westshore Terminals is said to be pursuing $54.4 million in claims against various entities involved in the significant damage incurred to terminal infrastructure and for consequential financial losses. The pilot involved has already admitted partial liability.
Qatargas’ Q-Flex class LNG carrier Al-Gharrafa delivers a
commissioning cargo to Tangshan Caofeidian LNG Terminal
China’s LNG imports have risen by a staggering 77% year on year to January 2014 and are now running at an annualized 2.7 million tons. One reason for this is the increase in the sheer number of LNG import terminals commissioned over the past 12 months. Most recently, PetroChina initiated its Tangshan LNG plant on December 11 and China National Offshore Oil Corp.’s Tianjin floating LNG terminal received its first cargo on January 22.
On the formal opening this week of Singapore’s first LNG terminal, the government has announced plans to build a second LNG receiving terminal as it steps on the ‘gas” to become Asia’s LNG trading hub. Singapore imported its first LNG cargo in March 2013 (picture above) and progressive expansion will raise capacity to 9 million tons a year by 2017. Spot LNG prices for Northeast Asia are currently trading near a record high at $19.60 per million British thermal units (BTU). Approximately 90% of Singapore’s electricity needs is derived from natural gas.
Patrolling of Emission Control Areas (ECAs) by so called aerial sniffer drones is being promoted by the French IT & Engineering company Explicit. The system claims to be able to calculate the exact position of the plume of a ship in real-time. This could be timely following a warning this week from the Danish Shipowners’ Association (DSA) that some European ship owners may be tempted to break the tougher ECA standards that will come into force from January 1 2015. The DSA has estimated that a commercial vessel running though the English Channel and then into the Baltic Sea through the Kiel Canal could save up to $300,000 per trip by using heavy fuel oil instead of a low-sulphur diesel.
computer image - HMS Queen Elizabeth
Her Majesty The Queen will officially name the Royal Navy's new aircraft carrier HMS Queen Elizabeth at a ceremony in Scotland this summer. The ceremony will be held on July 4 at Rosyth dockyard, in Fife, where work to assemble the vessel is being completed. The Ministry of Defence advertizes the 65,000 ton vessel as the largest vessel ever built for the Royal Navy and the most complex warship ever built in the UK. Watch for a future “Ship of the Week.”