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March 2011

News Letter - 29th March 2011

It’s been a month since out last newsletter and for that we apologise but for reasons that will become clear later on in this newsletter we have been rather busy in March.

At the end of February we visited IDEX – International Defence Exhibition in Abu Dhabi a full report on this can be found under the searchlight feature on our website www.carmania.org.uk. We encourage you to check our website for updates on our activities. Of direct relevance to our newsletters a Polish company called “Intermet” was there and had a new take on barbed / razor wire security systems for ships. The system is called Protector Fleet and consists of modules 3m in width that can be attached to the ships side at points of low freeboard in areas of risk. When deployed they release a barbed tape that forms a curtain. They can be released and retracted remotely and when retracted are light enough to be handled by two crewmembers. If you are interested mail Carmania and we will put you in touch.

Due to the rather extended period since our last newsletter this is rather a long one so we thought a summary of its contents might be helpful. We begin with an update on the situation with regards to the IMO Convention on ballast water treatment and advice on action to take to be compliant. We move on to a couple of company features: Green Mountain Security and Safety and Dobson Ship Management. At the end of the newsletter we return to the piracy issue for an update on the latest news before an update on Carmania.

Ballast Water Treatment – Where are we and how much time left to implementation?

The International Maritime Organisation (IMO) has developed the International Convention for the Control and Management of Ships’ Ballast Water and Sediments (BWM Convention) to regulate discharges of ballast water and reduce the risk of introducing alien marine species to the differing coastal regions of the world. The Convention includes two regulations: D1 which addresses the ballast water exchange standard and D2 that details the ballast water performance standard which essentially relates to treatment standards.

Ballast water exchange (D1) must be carried out in the deep ocean where such operations can present significant operational challenges and may not provide an effective solution and therefore the Convention requires ballast treatment be implemented according to the D2 schedule.

Entry into force

The Convention will come into force 12 months after the date by which not less than 30 States and a combined tonnage of not less than 35% of the gross tonnage of the world’s merchant shipping have ratified it. To date it has been ratified by 26 States constituting 24% of the world’s merchant shipping. Because of the slow pace of adoption the convention deadlines have become obsolete before full ratification has been implemented. This has resulted in more than a dozen nations implementing their own regulations to address the issue – a situation the IMO specifically tries to avoid.

The USCG is expected to publish their Ballast Water Discharge Standard rulemaking in early April 2011 (postponed from December 2010). This standard is expected to be almost the same as that of IMO but is to be implemented for all vessels whose order date (not delivery) is effected from January 1st 2012.

The revised regulation requires that:

Ships constructed in 2009 with a ballast water capacity of less than 5000 cubic metres must conduct ballast water management that at least meets the ballast water exchange standards but will be required to meet the D2 treatment standard at its second annual survey but no later than 31st December 2011, or EIF date - whichever is the latter.

A ship with a ballast water capacity of less than 5000M3 constructed after 2009 shall be able to conduct treatment that at least meets the D2 standard on delivery or EIF date – whichever is the latter.

A ship with a ballast capacity greater than 5000M3 constructed before 2012 must comply with the D2 standard not later than the first intermediate or renewal survey whichever occurs first and not later than 2016.

Vessels with a ballast capacity greater than 5000M3 constructed in 2012 and onwards are to meet the D2 standard at delivery.

Although MEPC 59 considered vessels built in 2010 they further considered that with the move towards ratification being where it is and as there were a sufficient number of approved ballast water treatment systems now available there was no need to further delay full implementation of the convention. The only remaining impediment is ratification by the required number of States.

Discharge Standards

These standards have been set by IMO under D-2 and are now achievable as the number of different approved ballast water treatment systems would suggest. It is expected the USCG will confirm acceptance of similar standards. Several states have already set their own standards which are actually higher than those of IMO. California have set their own standards 1000 times more stringent than those of IMO and no ballast water treatment equipment can meet these standards – neither now or within the foreseeable future, but that’s California!

What Now?

Very few new vessels recently delivered from yards or at present under construction are being fitted with ballast water treatment systems which will mean a large number of vessels will have to fit such plants in service or at their next repair period and at huge cost; at a time when charter rates are extremely low and positive financial returns from shipping almost non-existent.  For a VLCC it is estimated the cost of a suitable system will be $1.5M and upwards. There is also the question of the space required for the equipment to be considered. Any new building over the last two years or so should, if not fitting a ballast water treatment plant at the build stage, have at least taken into consideration the requirement for space to fit at a later date and future power requirements. Planning for back fits of these plants should be well in hand by now by all major ship owners if they are going to meet the ratification date because to start this process now or even later is already too late: more so when you consider there will most probably be a surge in orders once ratification is announced - and probably a resulting delay in supply. If this happens will IMO delay or extend the implementation period? This is doubtful considering the powerful voice the environmental lobby now has in western society!

It would now only take one major flag state to accept the convention to meet the tonnage requirement for ratification. Once this occurs it is probable that a number of small ‘players’ would quickly join the process (to be seen as being good environmentalists at no cost to them!) thereby meeting and exceeding the convention’s required number of states and hence ratifying the convention: a process that could now happen in a relatively short timeframe. The predictable result would be a ‘scramble’ for the necessary equipment resulting in an escalation of costs as manufacturers exploit the situation and recoup investments quicker than originally expected: we have seen this before! A number of fabrication and repair companies are waiting in the wings hoping the requirement to fit ballast water treatment plants will help them survive this period of reduced work.

Ballast Water Treatment Plant – what to choose?

There are broadly three technologies employed for rendering organisms inactive: mechanical, physical and chemical. Each technology is employed in several forms:

Mechanical: this can be in the form of filtration, cyclonic separation or electro-mechanical.

Physical: In the form of Ultraviolet light, cavitation / ultrasound and de-oxygenation.

Chemical: in the form of biocides and electro-chlorination.

Most of the equipment approved so far uses a combination of technologies. For example the Alfa-Laval Pure Ballast System utilises filtration and ultraviolet light. RWO Clean Ballast System uses filtration and electro-chemical oxidation. In the majority of cases one of the technologies employed is filtration along with another process. As of the end of 2010 there were 12 systems with full approvals from flag administration and 18 systems that had final approval but not yet flag approval. The options on equipment choice are increasing continuously with manufacturers from Norway (the country with the largest number of manufacturers of BWTS equipment), U.S.A, Korea, Japan, South Africa, Germany and the Netherlands: all with equipment either type approved or with final approval and in the case of the likes of Alfa Laval Pure Ballast System at sea on operational vessels. There are several companies with orders to supply BWTS on a number of new builds and some will be at sea as this article goes out.

Can the carriage of ballast water be avoided?

An interesting development which DNV claims they have developed (although the writer was present at a meeting where such was presented two years ago by NK and the Japanese Ship Research Council) is a hull form for tankers whereby ballast is no longer necessary. This is a vessel with a V form hull and broader beam which completely eliminates the requirement for ballast water on VLCC’s and greatly reduces the need for ballast water on smaller vessels. Such a vessel is claimed to be environmentally friendlier because less energy will be needed to propel the vessel and no energy needed for ballast handling hence less CO2, NOx and SOx are produced. Because no ballast is required there will be far less risk of corrosion and fewer areas to coat at the build stage. Such a hull form will add 10% - 15% to the initial building costs but with BWTS costing up to $2M per vessel and fuel at a price of approx $550 per tonne and continually increasing the pay-back will be within a few years of service commencement. It is thought the first VLCC of this hull form will leave the ship yard before the end of 2014.

Conclusion

Ratification of the BWM Convention could become a reality within months so ship owners / operators now need to seriously consider equipment choice and start considering supply and prepare to fit a ballast water treatment system (BWTS). Since this is a large project costing $1.5M and more for a VLCC probably the best time to fit such equipment would be at the vessels next docking since BWTS becomes necessary by 2016 or the first intermediate or renewal survey after that date for existing vessels. Leaving the decision for a few years could mean a shortage of equipment as many Owners / Operators wait to buy as late as possible due to the cost and complexity of installation. This could become a very serious issue if this happens and the IMO does not extend the deadline for compliance: possibly resulting in a vessel not compliant by the deadline not being unable to trade.

New vessels planned or recently ordered need to include a BWTS in the build specs rather than just ensure there is space for such a plant since as the revised IMO Convention applies to all vessels whose keels were laid between 2010 and 2012.

Should the new ‘V’ hull form be accepted there will be no need for BWTS on VLCC’s since this type of vessel would not need to carry ballast at all – but what shipping organisation is going to ‘take the plunge’ and be the first to have such a hull form built? Although expensive to build it will be much cheaper to operate and an added advantage will be the free publicity of being seen and being at the forefront of combating global warming and reducing considerably the carbon foot-print of your operation as well  as helping eliminate the spread of alien invasive species around the world.

Green Mountain Security and Safety Equipment Trading L.L.C.

Green Mountain Security and Safety Equipment Trading L.L.C., established in March 2005, as a Dubai based company specializing in all aspects of fire fighting equipment. The Company is ISO 9001 : 2000 approved and a member of the National Fire Protection Association.

With their experienced personnel and an agency agreement with Firex, a UAE company well known for their vast range of fire fighting products, Green Mountain are able to discuss, recommend, supply and install the correct fire fighting equipment / fire detection systems for office buildings / factories / ware-houses etc, plus offer a complete Annual Maintenance Contract for all of the equipment supplied. Recent contracts re-awarded by Aggreko, the worldwide portable power hiring company, have been the fit-out of 300 generator container sets with a smoke, heat detecting / fire alarm system.

Through the success that Green Mountain has had during these five years, they are now looking to expand their company into the marine industry. Please contact their Managing Director, Roy Giddings, for further information. Mobile: +971 50 450 8706.

Dobson Fleet Management Ltd.

With roots in the reefer market, Dobson Fleet Management Ltd. has developed a reputation for dry cargo management over the years. That was until Managing Director, Bob Maxwell, took over the helm in 2009. With over 30 years of experience operating large fleets, his vision for DFM has moved the company into new business areas with the addition of Chemical tankers and LPG vessels to the fleet and the opening of a new joint venture company in Qatar. 

DFM recognised that substantial investments, in terms of people, training and management systems, would need to be made to drive the company in this new direction.   For this DFM brought in new senior personnel with chemical and gas tanker expertise and created dedicated divisions to support the respective fleets.  Acknowledging that this move involved a different level of management, participation in training was also boosted to enhance the skills of existing staff.

In terms of management systems, DFM undertook a review of the entire management system to bring the DFM Safety Management System in line with TMSA requirements.  Annual reviews are more KPI focused than ever to ensure that the requirements of oil majors are achieved.  In less than a year, DFM has been awarded the management of not less than 4 gas and 2 chemical tankers.

DFM Maritime Qatar Ltd, was established in partnership with prominent local businessmen, and operates from offices in Doha to support business in both Qatar and the surrounding region.

Up to 50 Pirates Hijack Bulk Carrier in N. Arabian Sea

Pirates hijacked the MV SINAR KUDUS approximately 320 nautical miles northeast of the island of Socotra on March 16th according to EU NAVFOR. The Indonesian flagged ship was sailing to Suez from Singapore when she was attacked. The 20 Indonesian crewmembers sent out a distress signal and reported that 30 to 50 pirates had boarded and taken control of the ship.

The following day EU NAVFOR, reported pirates used the SINAR KUDUS as a mother ship to attack the Liberian flagged bulk carrier, MV EMPEROR. Five pirates launched a skiff and attempted to board the vessel. An onboard security team deterred the pirates and the EMPEROR continued on her route.

The same day Tunisia’s transport ministry announced that the MV Hannibal II had been released, after a $2 million ransom had been paid. The MV Hannibal II was hijacked on November 11, 2010.

Update

Just yesterday March 28th a merchant ship was fired upon and hijacked by pirates from two skiffs at 0600Z approximately 191 NM southeast of Salalah, Oman at 15:36N 057:04E.

Pirates are terrorists and should be treated as such

We note that the Asian Shippers’ Council (ASC) recently made clear it believed Somali pirates were working with al-Qaeda. It’s nice to see a shipping body agree with something we at Carmania have been saying for the past year!

They have called for “an offensive” against piracy and are urging governments to treat pirates in the same manner as terrorists and urged them to empower their navies to do this. They stated that the multinational naval presence in the region has not stopped the piracy problem growing.

From what we have been able to gather EU and NATO naval forces captured and released an estimated 700 pirates in the first six months of 2010: clearly unacceptable and even ridiculous. Attacks by Somali pirates in the Gulf of Aden and Indian Ocean have reportedly risen from 40 in 2007 to 218 by 2009.  According to the International Maritime Bureau, last year 49 vessels were captured and 1,016 crew members taken hostage by pirates. Currently, 28 vessels and 587 hostages are still detained off Somalia. Piracy costs the global economy billions of dollars a year, but the human costs are even higher. Hostages are being held for up to 120 days and several have been murdered. Yes murdered – they were killed by terrorists and that is murder. Enough is enough!

Carmania relocating to UK

Due to the economic situation in general and in Dubai in particular Carmania is closing its ME office but will continue to work from head office in the UK. We would like to take this opportunity to thank those of our readers who have contributed content to this newsletter and to our clients and partners who have provided us with work to date. Rest assured our activities will continue as will these newsletters. Who knows: with this relocation we may become even more outspoken!!!

One of our associates has recently been involved in the design of an upgrade for the complete waste treatment plant onboard VLCC’s and Afra-max tankers with these upgrades actually being implemented. He has made presentations on the subject. The work includes upgrade of OWS, waste handling equipment and improving the separation of clean bilge water from that which must be handled through the OWS. There is a rapid pay back by getting the system upgraded and a significant improved utilization of ships staff working time onboard. There are many compactors to choose from but many ship owners will only consider utilizing pneumatic compactors which are not as efficient at the job as hydraulic compactors. From discussions there is a false sense of the pneumatic compactors being safer than the hydraulic units. Should you be interested we can offer such consultancy services to your company.

We are well placed to offer advice on all aspects of the BWM convention in addition to our advertised engineering service offer comprising: CAP Surveys; Close-up Inspections; Project Management; Dry-dock Specifications; Steel Inspections; Coating Inspections; Problem, Accident and Incident Investigations; Pre-purchase Vessel Inspections ; Safety and Security Surveys and Expert Witness Representation. Our business consulting service consists of Market Analysis; Project Leadership; International Networking Opportunities; Business Development; Business Plans and Reports; Agency Provision; Company Set-up and Corporate Licensing Assistance. We hope to hear from you and until next time wish you the best of luck and every success…