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August 2010

News Letter - 6th August 2010

PIRACY – EFFECTS OF THE MONSOON SEASON

The Indian Ocean is now well into the annual six month monsoon season when the area is confronted with tropical storms and high seas – often with winds reaching 30 – 40 knots and sea swells of 6 to 7 metres and more. This usually limits the operation of skiffs to inshore operations. Is this the case this year? Looking at hijacking and attempted hijackings over the last two months more attempts are being made in the Gulf of Aden and the southern end of the Red Sea than in the open Indian Ocean. Several hijackings have taken place off Socotra – which is towards the entrance of the Gulf of Aden and even further east nearer the Maldives where the monsoon has not yet been effective in this early part of the season (the Indian coast get the monsoon later!) Although relatively ‘quiet’ on the hijacking front for the past month the weather must have lessoned in the past few days (with sea swell dropping from the usual 5 metres high plus at this time of year to less than 3 metres) for as recently as August 5th a cargo ship was hijacked in the Gulf of Aden and the crew taken hostage. It is so recent that there is very little detail on the subject at present. As indicted earlier it is only the S.W. monsoon weather curtailing the hijackers and NOT anything the multinational forces appear to be doing – or should we say not doing! What plans are there in place for really hitting these loathsome people once the S.W. monsoon subsides in late October / early November? Can we expect a greater effort and tougher policy against this vermin of society – we doubt it but as always are hopeful someone will waken up and take action.

The South China Sea has seen an increase in pirate activity with six incidents in as many days towards the end of June. It appears that attacks in this area ‘wax and wane’ depending on the intensity of government patrols carried out by Malaysia, Indonesia and Singapore. Attacks are usually at night and the targets are most often the ships safes and personal items of the crew rather than actual hijackings.

Mitsui O.S.K. Lines says one of its oil tankers may have been attacked July 28th near the Strait of Hormuz, the major Middle Eastern transit point for much of the world's oil.  The Japanese carrier said an explosion “which seemed to be an attack from external sources” damaged the M. Star's hull as the ship was passing through Oman's territorial waters west of the strait.  One crewmember was slightly injured, MOL said in a statement, and no oil leaked from the damage. The vessel, a very large crude carrier on its way to Tokyo for a scheduled delivery August 17th, went to the Port of Fujairah in the United Arab Emirates where it will be checked for damages.  The ship was beyond the Strait of Hormuz when the explosion occurred shortly after midnight local time. The strait, a transit point for an estimated 40 percent of the world's oil production, is north of the Arabian Sea region, which has seen widespread piracy in the last two years.

EU freezes assets of IRISL linked firms

According to Lloyds List some 24 companies allegedly associated with Islamic Republic of Iran Shipping Lines (IRISL) have had their assets frozen. The restrictions have been imposed because the EU believes that Tehran is intent on developing nuclear weapons, a claim that the administration of President Mahmoud Ahmadinejad resolutely denies. The UN, the US, the UK and several other jurisdictions have also introduced similar strictures. The EU further alleges the IRISL network has "been involved in the shipment of military-related cargo, including proscribed cargo from Iran" and has acted in ways that "involved clear violations" of UN sanctions.

Without getting into whether the EU is correct or the political ramifications of this issue it will surely not help in terms of business stability in the Gulf. The UAE and Iran, despite their ongoing dispute over the islands of Abu Musa and the Greater and Lesser Tumb off the UAE coast, have a huge trading relationship.

UAE BlackBerry Service

It has been announced by the Telecommunications Regulatory Authority (TRA) of the UAE that from October 11th some BlackBerry services will be suspended in the country because the services do not fall in line with the country's regulations. They have stated that "in their current form, certain Blackberry services allow users to act without any legal accountability, causing judicial, social and national security concerns." The suspension is a result of the failure of ongoing attempts, dating back to 2007, to bring Blackberry services in line with the country’s telecommunications regulations, the TRA added.

The Wall Street Journal reported that RIM recently refused to set up a proxy server in the U.A.E. and that the U.A.E. government is concerned that instant messages sent via BlackBerry's service cannot be traced, so it cannot be monitored or used in criminal or terrorist investigations. The Journal quoted two different anonymous sources regarding the reasons for the UAE's decision. The action against RIM, which offers its BlackBerry services through network operating centers in Canada, comes even as India is demanding that RIM should locate a server in India, and provide easy access to messages in the country to India’s security agencies. Reporters Without Borders have expressed the opinion that the U.A.E. government regards the services offered by BlackBerry, especially its instant messaging, as an obstacle to its goal of reinforcing censorship, filtering and surveillance.

This development comes a year after the UAE botched an attempt to download spyware onto Blackberries for which RIM issued a patch within days. Whatever the case here the suspension of this service does seem to go against the goal of making the UAE a global business hub. It is still early days and it is possible that a compromise will be reached that ensures this doesn’t happen. We sincerely hope this is the case for if the suspension goes ahead the world outside the Gulf will almost certainly see this as a step backwards.

Latest news: In addition to the UAE, Lebanon, Saudi Arabia, India and Algeria have all announced or are contemplating bans on the popular Canadian-made handsets. The US Secretary of State Hillary Clinton will hold talks with the UAE over the ongoing BlackBerry dispute so it’s anyone’s guess what will happen next – we will keep you posted.

Low Sulphur Fuel

It is now just over seven months since the new regulations came into effect with regards the burning of low sulphur distillate fuel in EU ports of a maximum 0.1% sulphur and only one month since the reduction of the sulphur levels in SECA areas from 1.5% to that of a maximum of 1.0%. So what has been achieved?? There has been a certain amount of confusion and many cases of vessels being in excess of the directives sulphur limit in SECA areas – although you will not find much in print about the latter!! A major problem with the LSFO is that it is produced close to the EU limit of 1.0%. Bunkering of this fuel is usually along the same lines which carry the bunkering of the HSFO. With the LSFO being close to the limit is does not take a lot of remnant HSFO (at up to 4.5% sulphur) remaining in the lines to ‘push’ the LSFO over the acceptable limit. On some vessels the distillate fuel filling is sometime partly along the HSFO line so one can envisage the effect this has on the bunkering of the gas oil. That said many owners have either fitted new pipe lines in such cases or are in the process of doing so.

Fortunately the majority of port states will be looking at the bunker delivery note (BDN) which is now a legal document and the original of which must be retained on board. We suggest any discussion on board should revolve around the sulphur levels stated on the BDN and not on the results from your own analysis. The latter information is mainly concerned with impurities in the fuel which can make combustion difficult and damage machinery – namely cat fines, vanadium pentoxide, high ash content etc, etc. The main concern of this testing is not so much the sulphur threshold being breached, although it will be of concern if it is reasonably over the limit for the reasons given and for the fact you will have paid a premium of $3 to $6 per tone more for this fuel than for that of the HSFO.

It is really all a bit of a mess and do we really cause less environmental damage? How is the sulphur reduced in the fuel in the first place? How is cutter stock produced – these are questions we hope to answer in the very near future when out research is complete!