It appears that in the dispute between The Panama Canal Authority (ACP) and its expansion contractor GUPC, both sides have taken a step back from allowing the dispute to disrupt the construction schedule. ACP has also this week published a list of FAQ http://micanaldepanama.com/expansion/faq/ and has assured the International Chamber of Shipping that the dispute will not impact the transit toll proposals already published.
ACP has released a construction update on Youtube, see http://www.youtube.com/watch?v=hRZ-S-RJH6Q#t=424
One of the world’s largest LNG carriers, a 266,000 CBM Qatari owned Q-Max is to be converted to a capability to run on LNG. The country owns 14 modern Q-Max vessels and 11 smaller Q-Flex vessels with 216,000 cu m capacity hence if technically proven worthwhile this could be the precursor to a major program of hybrid dual fuel retrofits. Already extremely efficient, the fleet was installed with re-liquefaction units to return boil-off vapour to the cargo tank to maximize cargo volumes delivered.
Transport Canada is inviting comments by January 31, 2014 on the report of the panel appointed to review Canada’s Ship-Source Oil Spill Preparedness and Response Regime. The report was formally released on December 3 2013 and can be found at http://www.tc.gc.ca/eng/tankersafetyexpertpanel/menu.htm. Many of you have been briefed on the report at Chamber meetings but should you have any questions or wish to discuss any aspect of the report, please contact Stephen at the Chamber. For its part, the Chamber will be making a submission hence the Board welcomes any member input by close of business, January 24. Individual submissions to Transport Canada can be also made to:
Ms. Genevieve St-Amour
330 Sparks Street
Place de Ville, Tower C, 25th Floor
ITB Marine Group which comprises ITB West, ITB Subsea, ITB North, ITB Fuels, and through its parent company, a partnership with Samson Tug Boats – has evolved steadily over the last decades and is now moving to a larger corporate office in Richmond.
ITB West covers Island Tug and Barge’s operation on the west coast, ITB North manages all arctic operations, and ITB Subsea now manages the submarine cable business and Canpac divers. ITB Fuels is the fuel reselling and tank farm business & Samson Tug Boats is an innovative harbour tug service based in the Fraser River.
After just over ten years at the 55 Rogers Street address, the Marine Group which provides management services to the individual business units - will move to a new building in Richmond BC, whereas the ITB West operations group has a slightly more complicated move planned. The office building located at 55 Rogers Street will be moved onto a recently renovated barge, and relocated to Island Tug & Barge’s base at Berry Point where it will provide a floating operations center.
Please note the new mailing address for the entire ITB Marine Group and Samson Tug Boats effective February 1st, 2014 shall be: Suite #310, 10991 Shellbridge Way, Richmond, B.C., Canada, V6X 3C6.
Maersk has announced the revival of the SeaLand name for regional intra-Americas container services. North-south ocean services in the Western Hemisphere will be integrated into the new platform effective January 1 2015.
The crew of the Royal Navy ship HMS Protector also celebrated an unusual Christmas in Antarctica whilst conducting the ship’s annual survey patrol on behalf of the UK Hydrographic Office and to provide logistical support to the British Antarctic Survey Organization. The crew marked the day by playing soccer and then enjoying a traditional dinner on the ice complete with trimmings (anything for a photo-op). The British Antarctic Territory is the UK's largest overseas territory.
On a related note, Nordic Bulk Carriers has been speaking of their intention to schedule more transits of the Northwest Passage following the successful voyage last September of their ice strengthened Nordic Orion when carrying coal from Vancouver to Finland.
After becoming trapped by Antarctic pack-ice on Christmas Eve, the Russian expedition ice-breaker Akademik Shokalskiy’s 52 scientists and tourists were eventually lifted off by a helicopter dispatched by the Chinese ice-breaker/research vessel Xue Long (Snow Dragon) and transferred by launch to the Australian ice-breaker Aurora Australis on January 2. Thereafter both the Akademik Shokalskiy and Xue Long remained trapped by heavy pack ice crew until a change in wind direction on January 7 provided an opening for escape prior to the planned arrival on the scene of the American icebreaker Polar Star. The vessel responsible for this truly international effort, the Akademik Shokalskiy had been chartered by the Australasian Antarctic Expedition to follow the route explorer Sir Douglas Mawson travelled a century ago. Scientific advances made during that expedition included work in cartography, geology, meteorology, aurora, geomagnetism, biology and marine science.
The Danish ro-ro vessel Ark Futura sailed this week from the Syrian port of Latakia with the first batch of that country’s chemical weapons under a UN-backed disarmament arrangement. The vessel loaded an initial shipment of nine containers which are to be transferred to the U.S. Navy’s Cape Ray for destruction. The overall plan is as follows:
1. The Syrian authorities are responsible for packing and safely transporting the chemical weapons from 12 sites across the country to the port of Latakia. Russia has supplied large capacity armoured trucks, while the U.S. has sent container drums and GPS locators.
2. Russia will provide security for loading operations at Latakia, for which the U.S. has supplied loading, transportation and decontamination equipment. China has sent 10 ambulances and surveillance cameras, and Finland an emergency response team in case of accidents.
3. Denmark and Norway are providing cargo ships and military escorts to take the chemicals to an as yet unnamed port in Italy. Russian and China will also provide naval escorts.
4. In Italy, the "most critical" chemical agents will be loaded onto the US Maritime Administration support ship Cape Ray to be destroyed by hydrolysis in international waters. Less-toxic chemicals will be shipped by Norwegian and Danish vessels for disposal at commercial facilities.
Japan’s Fair Trade Commission has handed down rulings to several major car carrier owners for allegedly violating anti-trust law. The action comes more than a year after investigations into possible price-fixing first began. K-Line, NYK and Wallenius Wilhelmsen Logistics are all believed to be initially affected but others may follow. Similar investigations are continuing in Europe and North America.
The loaded chemical tanker Maritime Maisie suffered a catastrophic fire last week after colliding with the car carrier Gravity Highway which was on sea trials off the coast of Busan, South Korea. Fortunately, all 91 personnel, 27 from the tanker and 64 from the car carrier, were rescued by coast guard and navy crews with no major injuries.
Also between Christmas and New Year, the fully loaded Qatari chartered and part-owned Q-Flex LNG carrier Al Gharrafa was in collision with the container ship Hanjin Italy (capacity 10,114 TEU) in the Singapore Strait. There were no crew injuries on either vessel, no damage to the LNG cargo containment system and no pollution, however as can be seen from the pictures, the bow of the Al Gharrafa is in need of a little repair work and the Hanjin Italy will need to take a time out for a few weeks to get straightened out. Arrangements are being made to discharge her containers in the Singapore area.
The Investigation into the incident that resulted in the flooding of the engine room on the mega container ship Emma Maersk (15,500 EU) last February has concluded that a series of technical failures compromised the watertight integrity of the vessel as she was about to begin a southbound Suez Canal transit. Three propeller blades of a stern thruster broke off and the consequent excessive vibration resulted in the breakdown of structural watertight barriers, due in part to cable penetration seals which had been incorrectly installed. The situation was further compounded by problems with the emergency bilge suction and the fact that the crew found themselves responding simultaneously to multiple emergency alarms.
However, the report goes on to state “that the events of the accident did not result in more severe consequences were due to the behaviour of the crew who managed to adapt to the situation and prioritise the recovery effort to meet the unfolding events. Due to the adaptive behaviour of the crewmembers, the shipboard organisation remained resilient despite the breakdown of the structural barriers, and even though no one had complete knowledge about the situation. The master had knowledge about the navigational situation, but limited knowledge about the events in the engine room. The chief engineer only had knowledge about the situation in the engine room”.
Whilst the Panama Canal Authority (ACP) maintains that it is committed to completing the waterway’s expansion in 2015, it is clear that all is not well with the finances surrounding the project. The lock construction consortium Grupo Unidos del Canal (GUPC) had threatened last week to suspend work on construction of the third set of locks claiming $1.6bn in cost overruns which are the responsibility of ACP. This spat has actually been escalating since ACP rejected the contractors’ original concrete mix for the locks, which set back the target completion date from October 2014 to June 2015. The locks are estimated to be around 65% constructed, with the overall expansion about 72% complete.
Following a Spanish government attempt to mediate in the dispute, ACP was more conciliatory this week and proposed that it and GUPC jointly contribute $283 million to the project which would allow GUPC to continue construction on the locks while claims for cost overruns are resolved under the three-step process established under the original contract between the two sides. However, Mr. Salini Impregilo, Chief Executive of GUPC partner company Pietro Salini did not mince his words in reminding ACP that the consortium is “not a charity”. He also suggested that ACP “stop telling fairy tales”.
To the north, and perhaps to nobody’s surprise, Nicaragua has announced that the start of construction of a $40 billion rival canal has been postponed to 2015. The government last year approved a plan that would see Chinese based financing of the project. Work was originally intended to start this year and take less than six years to complete the 286km new coast to coast waterway.
Shanghai handled a record 33.6 million TEU in 2013, an increase of 3.4% over 2012. For its part, Singapore also set a new record at 32.6 million TEU, up 2.9% on 2012 and a record tonnage of 557.5 million tons of cargo overall. Despite the cancellation of a few supplier licenses, Singapore also maintained status as the world’s largest bunkering port with 42.5 million tons sold.
Following on yet another train derailment, this time in Plaster Rock, New Brunswick, the Honourable Lisa Raitt, Minister of Transport, announced proposed regulatory amendments to further improve the safety of the transportation of dangerous goods by rail. These amendments are published in the Canada Gazette, Part I, on January 11, 2014.
The proposed regulations will introduce new standards for certain rail tank cars, replacing existing standards referenced in the Transportation of Dangerous Goods Regulations. For example, it will require that new DOT 111 tank cars be built with thicker steel requirements, as well as adding top fitting and head shield protection to the tank car. DOT 111 tank cars are used for transporting dangerous goods of high and medium danger, such as crude oil.
The pilot at the con of the Capesize bulker Cape Apricot when it was involved in the accident at Westshore terminals in December 2012 has admitted partial liability for the incident. However, judgments over much of the complex legal argument surrounding this case are required before there can be certainty as to what the liabilities of the various parties will be. Additionally, the Transportation Safety Board’s report into the incident has yet to be released.
Cape Apricot was chartered to K-Line, controlled by Japan’s Tokei Kaiun and owned by its affiliated company Leo Ocean. Westshore is believed to be claiming $50 million for physical damage and business disruption but lawyers for Leo Ocean are counter arguing that liability should be limited to a $26m security agreement already signed. The limitation of liability of a pilot under the Canadian Pilotage Act is also a matter subject to a ruling in this case.
On January 1, California set a leading edge in being the first jurisdiction in the world to require that container ships begin using shore power while at berth. The new “Vessels at Berth Regulations” will be phased in over the next six years with 50% of every container carrier’s fleet calling in California now being required to hook up to shore power, increasing to 70% on January 1, 2017, and 80% on Jan. 1, 2020. However, in showing some much needed pragmatism for a change, on Dec. 23, 2013 CARB issued an advisory that the “commissioning” of vessels could continue through June 30, 2014. At the same time, the allowable sulphur limit for both gas and diesel oil being burned in California’s waters was reduced to 0.1%, one year in advance of ECA regulations requiring same.
Unrelated to the above, vessels calling at California ports will also soon face new rules to curb bio-fouling. Draft regulations from the California State Land Commission are being prepared for implementation on January 1, 2015. The new rules which stipulate that a hull must have less than 5% bio-fouling or in a niche area less than 10%, have the same aim as ballast water regulations in so much as they seek to curb the spread of invasive aquatic species by specifying the percentage of biofouling permitted on the underwater parts of the ship’s hull. Niche areas are the sea chest and gratings, bow and stern thruster and gratings, fin stabilizers and recesses, propeller shaft, propeller and rudders. As is the case with ballast water rules, the bio-fouling rules will require presentation of a specific bio-fouling management plan and record book, listing dockings and cleaning activity. Australia and New Zealand have both played a role in crafting the regulations since they too are intent on adopting something similar and are believed to be preparing a case for IMO consideration.
After several months of unproductive lobbying, The Canadian Shipowners Association (CSA) has publicly voiced concern over the US Environmental Protection Agency’s (EPA) new Vessel General Permit (VGP), which came into effect on December 19. The new VGP regulates discharges from commercial vessels, including ballast water but a report released by CSA has concluded that the installation of ballast water management systems on Canadian domestic vessels beginning in 2014 will cost the Canadian economy $1.1 billion over the next five years. However there is more to the story given that shipowners cannot comply with the regulations “since the technology to do so does not exist" underlines CSA President Robert Lewis-Manning. As a consequence of the deadlock, CSA announced this week that it has decided to formally petition the U.S. Court of Appeals of the Second Circuit for a review of the VGP, and more specifically, the Jan 1, 2014 compliance deadline.