Showing posts with label Maritime. Show all posts
Showing posts with label Maritime. Show all posts

Wednesday, January 4, 2012

The Russians Are Coming to Nome, AK.

The following is the text of a press release issued by the U.S. Coast Guard:
(04 January 2012)
(DUTCH HARBOR, Alaska) -- Coast Guard inspectors completed a port state control exam on the double-hulled ice-classed Russian tanker Renda today in Dutch Harbor.

"The tanker vessel Renda met all applicable federal laws and regulations and can operate in U.S. waters following the successful completion of a required Coast Guard port state control examination," said Rear Adm. Thomas Ostebo, commander District 17. "Our daily discussions will continue with our federal, state, local, tribal partners, and the marine industry to ensure the highest standards of safety and compliance are in place to mitigate risks to the people of Nome, the crews of the vessels, and the environment."

The Renda will be escorted by the Coast Guard Cutter Healy and is expected to arrive in Nome on Jan. 8, 2012 if on scene weather conditions permit safe passage.

The Healy will lead the Renda through 300 miles of ice to within a half mile of the harbor entrance. "Upon arrival, the Renda will transit the remaining distance to stable ice close to the harbor entrance to transfer fuel via hose under approved procedures," said Capt. Craig Lloyd, District 17 chief of response who is coordinating the mission. "University of Alaska personnel are in Nome to assist in determining the thickness of the ice outside the harbor entrance. Due to a large ridge of ice at the harbor entrance, the Renda is unable to enter the actual harbor."

The Secretary of the U.S. Department of Homeland Security approved a Jones Act Waiver Dec. 30, 2011 to Vitus Marine authorizing the foreign-flagged tanker to deliver gasoline from Dutch Harbor to Nome. Renda arrived in Dutch Harbor laden with diesel fuel that was on loaded in Asia. The Jones Act waiver was required since Renda could not load the gasoline cargo in Asia due to weather and scheduling constraints. The vessel is scheduled to take on additional cargo of gasoline in Dutch Harbor today.

The Healy's participation was contingent upon the following items: the Renda passed the port state control exam, there were no inordinate delays, the fuel transfer plans met federal and state requirements and on scene weather conditions permit safe passage.

Sitnasuak Native Corporation of Nome signed a contract with Vitus Marine LLC to deliver 1.3 million gallons of petroleum products to Nome via Renda around the second week of January. If successful, this will mark the first time that petroleum products have been delivered by sea to a Western Alaskan community through ice covered waters.
"This has been and continues to be a highly orchestrated effort between all stakeholders to ensure mission success" said Ostebo. "As we have done for more than 220 years, the Coast Guard is dedicated to ensuring the safe and secure transfer of maritime commerce. The Healy, our nation's only operating polar ice breaker, and its crew are committed to upholding our long history of service to the residents of Alaska."

The Healy is named after Capt. Mike Healy, an 19th century Coast Guard hero. As the commanding officer of numerous Coast Guard cutters, "Hell Roaring Mike", enforced federal law, provided search and rescue, and provided humanitarian assistance along Alaska's 20,000 mile coastline in the late 1800s. The cutter is 420-feet long and has extensive scientific capabilities. Homeported in Seattle, the cutter has a permanent crew of 80 and was originally scheduled to return home in mid December. The primary mission is scientific support but it is capable of other Coast Guard and defense operations such as search and rescue, domestic ice breaking, environmental protection and the enforcement of laws and treaties in the Polar Regions.

Wednesday, November 9, 2011

Unions Condemn Maritime Administration Report


From Seafarers International Union Website:
11/7/2011


Statement by American Maritime Officers; International Organization of Masters, Mates and Pilots; Marine Engineers’ Beneficial Association; and Seafarers International Union
On Maritime Administration Report Comparing U.S. and Foreign-Flag Operating Costs
November 7, 2011

Maritime Administration Disregards Shipboard Labor, Releases Flawed Report


The U.S. Maritime Administration recently released a highly contentious study of American-flag shipping without any input whatsoever from maritime labor. This inexplicable decision guaranteed that the report would not contain the information that Congress and the Administration would need to develop and implement meaningful maritime policy that strengthens, not weakens, the U.S.-flag merchant marine, provides jobs for American, not foreign, maritime workers, and bolsters, not diminishes, the economic, military and homeland security of the United States. The administrator who approved the report, David Matsuda, should be held accountable.

The Maritime Administration, more than a year ago, was tasked by Congress with identifying ways to boost American-flag shipping. Instead, the agency accepted a report based on incomplete information whose main conclusion – that in the deep-sea commercial sector, it often costs more to use U.S.-flag ships – isn’t news to anyone. The fact that MarAd chose to exclude a significant segment of the maritime industry from this process, and accepted a report that includes possible cost-cutting suggestions that are completely contrary to the overall best interests of the United States, represents a gigantic failure in Matsuda’s leadership and a missed opportunity on the part of the Maritime Administration.

How could the Maritime Administration sign off on a report that suggests consideration of weakening or eliminating the Jones Act, one of the bedrocks of our national and economic security? How could the agency not refuse the mere notion of turning America into a second register? (It should be noted that the carriers interviewed for the study soundly rejected lowering U.S.-citizen crewing requirements as well as the second-register idea.)

We make no apologies whatsoever for the fact that our members make a living wage and receive health care and pension benefits. American mariners are second-to-none worldwide when it comes to being properly trained for their profession. Yet MarAd’s report points to these factors as some of the reasons why it costs more, on average, to ship American. MarAd should be ashamed of itself for entertaining a study that suggests that beating down American mariners to the level of Third-World labor and lowering their standard of living are good for our industry and good for our country. The findings of this report are an insult to the brave men and women who comprise the U.S. Merchant Marine, including those who sail in harm’s way to deliver vital materiel to our armed forces.

We stand ready to work with Congress and the Administration to make our industry stronger, larger and more competitive. The Maritime Administration had the opportunity to start this process in an all-inclusive, productive way. It is not only unfortunate but a clear dereliction of duty that they chose not to and instead spent time, energy and resources on a report that serves no useful, constructive purpose.

Tuesday, November 8, 2011

Bad News for the US Shipping Industry.



Average US vessel operating costs last year were almost three times higher than their international counterparts, according to a report from MARAD, the US maritime administration body.

The report, Comparison of US and Foreign-Flag Operating Costs, says: “US flag-carriers are at a distinct disadvantage in their ability to compete in international transport markets.”

The comparison used aggregate average total operating costs.

MARAD also found that average operating costs for US-flagged containerships and ro-ro vessels in particular were generally three times higher than foreign-registered ships.

Difference in crew costs were even more noticeable – roughly 5.3 times higher for US-flagged vessels in 2010, even though their average crew size is slightly smaller. Crewing costs on US bulk carriers were 5.7 times higher.

The report attributes the higher operating costs to regulatory requirements on vessel labour, insurance and liability, maintenance and repairs, taxes and expenses associated with environmental compliance, higher wage rates and social benefits.

The report also notes that approximately 110 ships fly the US flag, while more than 540 US-owned vessels are registered in 31 other countries, presumably to reduce costs.

The report also suggests several options MARAD may pursue to encourage participation in the US fleet.

These include promotions and missions to secure additional streams of commercial cargo for US-flagged vessels, encouraging US companies to support domestic industry by using US vessels and providing information on annual cargo preference volumes to assist carriers with business planning.

USCG Responds to A Singing Barge Near Miami

MIAMI - The crew of the Coast Guard Cutter Seneca responded to a sinking barge approximately 10 miles east of Miami, Nov. 7, 2011. The crew of the tug towing a barge notified watchstanders at Coast Guard Sector Miami they were experiencing fuel problems and later become disabled and adrift. U.S. Coast Guard photo.
MIAMI - The crew of the Coast Guard Cutter Seneca responded to a sinking barge approximately 10 miles east of Miami, Nov. 7, 2011. The crew of the tug towing a barge notified watchstanders at Coast Guard Sector Miami they were experiencing fuel problems and later become disabled and adrift. U.S. Coast Guard photo.

MIAMI — The crew of the Coast Guard Cutter Seneca responded to a sinking barge approximately 10 miles east of Miami Monday afternoon.
The crew of a 94-foot tug boat towing a 270-foot barge notified Coast Guard Sector Miami watchstanders they were experiencing fuel problems and later became disabled and adrift.
The cutter Seneca arrived on scene and took the tug in tow. The crew of the Coast Guard Cutter Diamondback and a Coast Guard Air Station Miami HC-144 Ocean Sentry aircrew also arrived on scene to monitor the situation.
The barge, which has 33 empty containers on deck, was believed to be taking on water. Divers from TowBoat U.S. are attempting to dewater the barge. A commercial tugboat is scheduled to arrive on scene Tuesday morning to relieve the cutter Seneca of its tow.
The cutter Seneca is a 270-foot medium endurance cutter homeported in Boston.
The cutter Diamondback is an 87-foot patrol boat homeported in Miami Beach, Fla.

Monday, November 7, 2011

Shipping Company Pleads Guilty to Pollution Charges

(11/7/2011)
The following is the text of a press release issued by the U.S. Attorney for the District of Oregon:
(PORTLAND, Ore.)– U.S. Attorney S. Amanda Marshall and Oregon Attorney General John Kroger jointly announced that the owner and operator of a Cyprus-based ship pleaded guilty today to felony oil pollution charges.

A.E. Nomikos Shipping Inv. Ltd. and Lounia Shipping Co. Ltd. pleaded guilty to one count each of violating the Act to Prevent Pollution from Ships, and knowingly making false statements to the U.S. Coast Guard. As part of the plea agreement, the companies agreed to pay a $750,000 fine. Half of the fine – $375,000 – will go to the Oregon Governor’s Fund for the Environment, which is dedicated to local environmental cleanup and restoration efforts focused on preserving and protecting Oregon’s rivers, watersheds, and fish and wildlife.

Nomikos was the operator and technical manager of the Arion SB, a bulk carrier that operated under the flag of Cyprus. Nomikos provided management services pursuant to a contract with Lounia, the registered owner of the Arion SB. Nomikos is headquartered in Piraeus, Greece. Lounia is headquartered in Cyprus.
Representatives of the companies entered guilty pleas before U.S. District Judge Michael H. Simon today, after which Judge Simon imposed sentence. In addition to the $750,000 fine, Judge Simon sentenced both defendants to three years probation, during which both defendants will be required to fund and implement an Environmental Compliance Plan.

An investigation revealed that between at least June 2011 and October 16, 2011, Nomikos and Lounia, acting through their agents and employees, directed subordinate engine room crew to run the Arion SB’s Oil Water Separator improperly. Specifically, the Chief Engineer instructed the Second Engineer to pipe fresh, clean water directly into the Oil Content Meter for the purpose of blinding the Arion SB’s Oil Content Meter, so that it would not function properly to prevent the overboard discharge of oil-contaminated waste in excess of 15 ppm. The Chief Engineer failed to include any entries in the Arion SB’s Oil Record Book relating to the crew’s improper use of fresh water to manipulate the vessel’s Oil Content Meter, and also included inaccurate entries in the Oil Record Book regarding the crew’s use of the vessel’s Waste Oil Incinerator.

“The sentences imposed today should send a clear message that the United States will hold vessels responsible for dumping oil in our oceans and for lying to the United States Coast Guard. We are pleased that the court allocated $375,000 of the fine to be used here in Oregon to benefit our environment,” said U.S. Attorney S. Amanda Marshall.

“The Oregon Department of Justice is deeply committed to holding polluters accountable when they break the law,” said Attorney General John Kroger.

This case came to light after the United States Coast Guard boarded the Arion SB, on or about October 16, 2011, to conduct a Port State Control Safety Exam for the vessel.

“This case demonstrates our commitment to ensuring that vessels calling on U.S. ports fully comply with U.S. laws and international treaties,” stated Rear Admiral Keith A. Taylor, Commander, Thirteenth Coast Guard District.

The case was jointly investigated and prosecuted by federal and state authorities. The case was investigated by the U.S. Coast Guard, U.S. Coast Guard Investigative Service, and Environmental Protection Agency Criminal Investigation Division. Assistant U.S. Attorney Stacie F. Beckerman and Special Assistant U.S. Attorney Patrick Flanagan of the Oregon Department of Justice’s Environmental Crimes Unit prosecuted the case.

VIGOR & US Fab Deliver New Ferry to Washington State


From Professional Mariner
(11/7/2011)
SEATTLE, WA - One completed, one to begin. Even as VIGOR Industrial this week delivered the final new 64-car ferry to Washington State Ferries, the company's US Fab shipbuilding division received a green light from the state to begin constructing the system's next vessel.
On Monday, the companies delivered the state's newest ferry, Kennewick, to WSF, three months ahead of schedule.
Separately, the state today authorized the shipbuilder to begin constructing Washington's next new ferry, a 144-car vessel designed to provide maximum capacity in the system's Pacific Northwest waters.
Today's "notice of award" allows US Fab to begin production after it finalizes its contracts and begins to order steel and other materials. The ferry construction will generate more than 500 jobs around Puget Sound, with more than half of the work and materials expected to come from two dozen regional subcontractors and vendors.
"These are two great steps for the people who ride and rely on Washington State ferries as well as for those of us who build these ships," said Kevin Quigley, president of VIGOR's US Fab division. "Tens of thousands of people will ride the Kennewick and then the new 144-car ferry every month. And hundreds of Washington workers will have jobs building and outfitting the new boat in our shipyards and with our subcontractors and suppliers throughout the region."
The just-completed ferry and the just-approved one are both major milestones for Washington's vessel replacement program.
"We're elated that our partners at Vigor shipyards delivered the Kennewick three months ahead of schedule — that means our customers will get to enjoy a new vessel even sooner than we'd planned," said David Moseley, Assistant Secretary of Transportation and WSF director. "And I am thrilled that we are moving forward with the 144-car ferry program. This vessel will allow us to retire the 55-year old ferry Evergreen State and provide more reliable service to our customers."
The final negotiated price of $115.4 million includes more than $6 million cut from the company's initial contract submission. VIGOR, US Fab and WSF worked closely together to eliminate non-essential items while maintaining safety, performance and passenger conveniences. Savings include the use of some new materials and improved methods for building mechanical systems, as well as improved construction scheduling, more efficient training, stricter quality assurance and new contract management approaches that VIGOR and its team learned from building the 64-car ferries.
The new ferry will cost $400,000 less per car-slot than the initial 64-car Kwa-di Tabil class vessel.
Construction will generate an estimated 200 family-wage jobs at VIGOR's large Harbor Island facility, which the company acquired when it purchased Todd Pacific Shipyards in February. The work also will provide an additional 350 jobs at subcontractors, vendors and other shipyards in the region and will support thousands of additional indirect jobs.
"Industrial jobs really matter in this state," said Frank Foti, VIGOR president and chief executive officer. "With this ferry, we're expanding the proud, hundred-year legacy of shipbuilding at Harbor Island. We're continuing the successful model of teaming with other shipyards around the state, as we did with Kennewick and its two sister ships. And we'll be building the newest ferry that passengers, Washington State Ferries, the Legislature and the Governor all determined is very much needed."
Today's notice of award is the next step in a contract initially adopted by the state in December 2007 with funding overwhelmingly approved by the legislature and governor this spring.
"We're ready to get underway," Quigley said. "We believe our subcontractors share our commitment to building the vessel the Legislature and WSF want at the lowest possible cost, delivering the best value possible to the state and the ferry passengers."
The 144-car ferry will be the ninth built at Harbor Island when it joins Kennewick and 22 other vessels in the WSF fleet. The system is the largest ferry operation in the United States and the fourth largest in the world.
The shipbuilders expect to start "cutting steel" in early 2012; final construction will last up to 27 months.

Port of Seattle Turns Up 10 Explosive Containers

US Coast Guard admits it has no plans yet for dealing with containers
 

At least ten more potentially explosive containers have been found at the Port of Seattle with a question mark still hanging over the fate of the growing collection of containers.

Earlier this year maritime authorities reported that three reefer containers exploded or caused a fire, resulting in two fatalities in Vietnam and one in Brazil.

The explosions were believed to be the result of contaminated gas added to the boxes’ refrigeration units during servicing in Vietnam.

According to local reports, a growing stack of 80 refrigerated containers at the Port of Seattle have been sitting by itself, isolated from the rest of the port for safety reasons.

The US Coast Guard said it is working with the terminal operators to keep the 80 containers away from everyone, but admits there is no specific plan yet for dealing with them.

Rudy Finne of the International Longshore and Warehouse Union, said: "I personally think it’s ludicrous to have possible bombs at every corner here and have everybody seem not that concerned about it."

The Pacific Maritime Association, which represents the various terminal operators, said it is looking for a solution to checking each container to see if it poses any risk. These at-risk containers are being turned away from terminal operators, and as a result, they remain out in the public.

Meantime, the union is worried about containers that left Vietnam and may have passed through local ports before the security alert was put in place.

The three reefers that exploded were operated by Maersk Line, but since the danger was reported all carriers are scrambling to find any reefers that have been repaired in Vietnam since February.

Maersk has removed all its 844 reefer containers that have been repaired in Vietnam.

Sunday, November 6, 2011

German Warship Disrupts Pirates.

Suspect pirate jettisons an RPG warhead
Suspect pirate jettisons an RPG warhead
On 4 November 2011, following a coordinated search and detection by a French Maritime Patrol and Reconnaissance aircraft, the German warship FGS KOELN, operating as part of the EU NAVFOR, disrupted a pirate action group comprising a whaler and skiff, 50 nautical miles off the coast of Tanzania. On detection, the suspect pirates jettisoned their pirate equipment overboard and were detained without resistance. They have been transferred onboard FGS KOELN and the two pirate boats sunk, preventing their use against merchant shipping in the area.
EU NAVFOR Somalia is a counter-piracy taskforce operating in the area of the Gulf of Aden and the Indian Ocean responsible for repressing acts of piracy and for the safe escort of ships carrying World Food Program aid and vessels of the African Union Mission in Somalia (AMISOM). Additionally, EU NAVFOR monitors fishing activity off the coast of Somalia”

The Changing Face of Piracy

From Maritime Reporter & Engineering News, October 2011
 
David Rider
File
As the NATO and EU NAVFOR operations Ocean Shield and Atalanta continue their work in the Gulf of Aden, Indian Ocean and Red Sea areas, one could easily be forgiven for thinking, well, that’s that. Tough luck, pirates, the world is on to you. Sadly, as anyone involved in international shipping knows, that is very far from the truth.
The fact is that the areas patrolled by the world’s navies are vast and the chance of early interdiction of a pirate skiff or mothership by a naval vessel is small. In the risk versus reward world of the pirate, it’s a virtual no-brainer.
Given that around seven percent1 of the world’s oil supplies and an estimated 22,000 vessels transit the Gulf of Aden (GoA) annually, it would be reasonable to expect that same transit route to be safe and free of incident, but the reality is far from it.
In early August 2011, the International Chamber of Commerce’s Commercial Crime Service reported that there had already been 22 successful hijackings by Somali pirates, while countless others have been approached, attacked and pursued by pirates in high speed skiffs, launched from nearby motherships.
As the methods employed by the world’s navies to combat them have become more sophisticated and organized, so the pirates have changed their tactics to suit, with the first six months of 2011 showing a dramatic rise in attacks over the same period for 2010; some 266 attacks on vessels in the period, compared with 196 for last year2.
This year’s monsoon season has been a stark reminder that pirates are highly motivated to capture their quarry. While normally shipping could breath a sigh of relief at the arrival of the summer monsoon, this year the IMB issued a statement warning seafarers of the continuing danger of pirate attack. The organization said that the movement of pirates to the GoA and Southern Red Sea (SRS) areas, due to monsoon conditions in the Indian Ocean were a, “cause for concern.” IMB Director, Captain Pottengal Mukundan, said: “It may be that these recent Indian Ocean incidents are a sign of desperation by pirates, or that there are many more pirate groups operating now than there were in 2010, particularly outside the Gulf of Aden.”
As a leading supplier of armed security personnel to the maritime community, Neptune Maritime Security continually has Vessel Protection Teams (VPTs) transiting both the IRTC and High Risk Area, and identified a potential trend in pirate tactics during the monsoons.
While July was a quiet month in the SRS region, with only a handful of minor reports, a string of what can only be termed ‘swarm’ attacks took place in August off the coast of Eritrea, possibly due to pirates moving up through Bab el-Mandeb, the ‘Gate of Tears,’ the strait that connects the Red Sea to the Gulf of Aden and Indian Ocean. When the monsoons bring dangerous conditions to the open sea, pirates will retreat here to calmer waters.
It was here that large numbers of pirates were reported to be operating in ‘packs’ and attempting to swarm vessels in large numbers.
The first incident, on August 7, according to the report filed with the IMB’s Live Piracy Reporting Center3, saw 12 skiffs containing between five to eight pirates per skiff pursue and attack a bulk carrier approximately 20nm off the coast of Eritrea. As the skiffs approached to within 300m of the carrier, the Master ordered the armed security guards onboard to fire warning shots at the pirates’ skiffs. While this show of force saw the majority of pirate vessels break off their attack, two skiffs continued in their pursuit for some 30 minutes, returning fire at the armed guards until they, too, aborted their attack. If one believes the report – and there is no reason to doubt the legitimacy of reports filed with the IMB – then even underestimating the number of pirates to just 60 still leaves us with evidence of a worrying trend in pirate tactics.
Following an advisory notice issued by Neptune Maritime Security to both the media and other companies in the industry, we received news of a second ‘swarm’ attack4 on August 10. On this occasion, a Panama-flagged tanker, Golden Topstar, was pursued while underway at 13:08N-043:07E by pirates in 12 skiffs. The vessel evaded the attack by employing evasive maneuvers and firing flares. The site of the incident is just 6.5nm away from the attempted attack three days previously.
A third ‘swarm’ attack occurred5 on August 17. A bulk carrier underway, approximately 22nm off Assab, Eritrea, at 13:16N-043:01E, was approached by seven high speed boats, each containing three to five men, armed with automatic weapons. Again, the attack was repelled thanks to the employment of evasive maneuvers and an increase in speed by the vessel. This attempt occurred just 10.2nm away from the incident on August 10th.
Reports then emerged from the Iranian Navy, concerning a wave of attempted attacks on the bulk carrier ‘SAEI’ at the mouth of the SRS at Bab-el-Mandeb, although exact location information was not provided. According to the Iranian Navy report, the first attack saw four skiffs containing 20 pirates engage the vessel, the second wave featured eight skiffs with a force of 40 pirates and a third and final attempt was said to feature just two skiffs with just 12 pirates on board.
While some sources have questioned the credibility of these reports, the bulk of available data should at least raise concerns in the industry as to the changing and malleable nature of the tactics employed by pirates in the area. The IMB reports6 that (at the time of writing), since May 20, 14 vessels have been attacked in the Southern Red Sea.
Further east, pirates were also changing their MO, choosing to avoid the rough Arabian Seas in favour of daring raids near major shipping hubs.
The successful hijacking of the chemical tanker, Fairchem Bogey7, on August 20, illustrates how pirates have altered tactics in response to pressure from EU NAVFOR, the monsoon and better practice by vessels transiting the HRA. According to reports, the Fairchem Bogey, carrying a cargo of methanol, anchored 4-5 miles off the Omani port of Salalah. Ironically, the armed guards employed by the shipping company to watch over the vessel in transit had disembarked once the ship reached what was thought to be safe anchorage. Then, at approximately 0630 UTC, a group of pirates stealthily boarded the vessel and took its crew of 21 hostage. Did the pirates have someone on shore, advising them of the protection team’s departure, or was this just dumb luck? We may never know.
The attack caused concern not only due to its brazen nature, but also because Oman has a well resourced Coast Guard, who were on the scene within an hour. Unfortunately, by then it was too late, and they were warned off by the hijackers, who later sailed the vessel to Garacad and demanded a $10m dollar ransom for its release8.
The attack shows parallels to the hijacking of the cargo ship, Leopard, which was boarded off the Omani coast on January 12. The freighter had discharged its armed guards and was boarded shortly afterwards. Six crew members are still being held hostage by the pirates involved9. Since the hijacking of the Fairchem Bogey, there have been several other attempts made to attack vessels, which the Omani Coast Guard have rebuffed.
While attacks on vessels off Oman are hardly news, recent weeks have seen an increase in attempted hijackings in the region, which perhaps illustrates the increasing pressure pirate gangs have felt due to local weather conditions, the presence of naval vessels and more recently, the presence of armed security guards onboard vessels. According to EU NAVFOR, 90% of ships surviving a pirate attack in the Gulf of Aden this year have credited a security team for aiding their escape10.
As we reach the end of the monsoon season, international shipping can once again expect Somali pirates to strike out further into the Arabian Sea and Indian Ocean in an attempt to make up for time lost due to the monsoon, utilising hijacked fishing boats and merchant vessels as mother ships. As Captain Keith Blount, Chief of Staff with EU NAVFOR told Reuters: “I think we are going to see a surge in piracy because we always have done at this time when the southwest monsoon abates and the seas become flatter.”
 “Typically the pirates have a really good go in the autumn and winter,” he said on the sidelines of a shipping conference11.
The international battle against piracy continues its cat and mouse game, with no immediate end in sight for either the beleaguered shipping companies who have paid an estimated $95 million in ransoms this year alone, or the estimated 343 seafarers still being held hostage in Somalia12.

Neptune Maritime Security
www.neptunemaritimesecurity.com
Email: info@neptune-ms.com

(As published in the October 2011 edition of Maritime Reporter & Engineering News - www.marinelink.com)

Saturday, November 5, 2011

DryShips and OceanFreight Complete Merger


Friday, November 04, 2011
 
File
DryShips Inc. (NASDAQ: DRYS) and OceanFreight Inc. (NASDAQ: OCNF) announced today that following approval by OceanFreight's shareholders at a special meeting, the companies have completed the merger and OceanFreight has become a wholly-owned subsidiary of DryShips. Under the terms of the merger agreement, OceanFreight shareholders will be entitled to receive $11.25 in cash and 0.52326 of a share of common stock of Ocean Rig UDW Inc., a global provider of offshore ultra deepwater drilling services, for each share of OceanFreight common stock owned by them.

As a result of the merger, OceanFreight's common shares will cease trading on the NASDAQ Global Market today, and OceanFreight expects to deregister and suspend its reporting obligations under the Securities and Exchange Act of 1934, as amended.

American Stock Transfer & Trust Company has been appointed to serve as the agent for payment of the merger consideration to OceanFreight shareholders, and will promptly mail to shareholders instructions on how to surrender their stock certificates and receive payment for their shares. Banks, brokerage firms or other nominees will provide those shareholders who hold their shares in "street name" with their proceeds from the transaction. For more information, shareholders who hold their shares in "street name" should contact their bank, broker or other holder of record, and shareholders of record may contact American Stock Transfer & Trust Company at (877) 248-6417 (toll free). Shareholders of record should wait to receive the letter of transmittal before surrendering their shares.

Friday, November 4, 2011

What If Deepwater Horizon Oil Spill Happened In Cuban Waters?

WASHINGTON (Dow Jones)–Several U.S. companies are asking the Obama administration for permission to respond to potential oil spills in Cuban waters, a top offshore drilling regulator said Wednesday, hoping to overcome embargo restrictions that currently limit their ability to do so.

The companies’ requests coincide with a growing concern among oil-industry experts who say the U.S. embargo on Cuba could cripple the ability of spill-containment companies to respond to potential spills that start in Cuban waters but then move to U.S. shores.

Speaking at a congressional hearing Wednesday, Bureau of Safety and Environmental Enforcement Director Michael Bromwich said several companies have asked the U.S. Commerce Department for licenses that would allow them to use subsea well containment systems and other types of equipment to respond to spills in Cuban waters.

Bromwich said he had “a high level of confidence” the Commerce Department would approve the licenses, in large part because it had already issued separate approvals for oil-spill containment systems and cleanup items. U.S. government agencies “are very much on alert, looking for the licenses [applications] as they come in and my understanding is that they’re giving them very rapid attention and they’re approving them as promptly as they can.”

The administration’s efforts are not without controversy. The chairman of the House Energy and Mineral Resources Subcommittee, Rep. Doug Lamborn (R., Colo.), said Wednesday that he is concerned “this administration will weaken the U.S. embargo on Cuba.”

Earlier in the week, the head of the House Foreign Affairs Committee sent a letter to President Barack Obama asking him to do more to prevent Cuba’s oil-drilling plans. “This scheme endangers U.S. security and environmental interests, and will enrich the Cuban regime,” Rep. Ileana Ros-Lehtinen (R., Fla.), a Cuban-born American, said.

Many environmental and oil-industry experts have taken a different approach and have urged the administration to give broad flexibility to U.S. companies that are equipped to respond to spills.

They contend Cuba will pursue oil exploration, regardless of whether the U.S. disapproves, so the U.S. should simply prepare for possible accidents.

Cuba’s offshore drilling plans get under way in coming months when Spanish company Repsol YPF SA (REPYY, REP.MC) starts to conduct exploratory drilling off the country’s northern coast. Repsol is transporting a Chinese-built rig to be used for the exploration work.

Repsol has voluntarily agreed to allow U.S. officials to inspect the rig before it enters Cuban waters. The company has also agreed to comply with U.S. drilling standards.

-By Tennille Tracy, Dow Jones Newswires

Tuesday, November 1, 2011

Port of Oakland Operations Halted by Longshoremen.

This video from KGO-TV in Oakland is pretty amazing, especially considering the Occupy Oakland Movement (A part of the Occupy Wall Street Movement) is planning a "blockade" in the city. I can only imagine the traffic headaches this will create. As Mr Roman mentions, this affects ports up and down the West Coast. So if you're on the West Coast near a major port, this could be coming soon!


By Tomas Roman
Dock workers at the Port of Oakland refused to unload ships that are loaded with what they call explosive contents. At least two terminals at the port were closed Monday night because of the threat. It is an extra challenge for the port already preparing a possible blockade by Occupy Oakland on Wednesday and the backup is extensive.

The longshoreman are refusing to move any containers at certain terminals because they say refrigerated containers that were improperly serviced in Vietnam have already exploded in Vietnam, China, and Brazil. Some of those containers have been found in Oakland and other West Coast ports.
Photos were taken in Vietnam of one of the five refrigerated containers that exploded at a port there last Friday. Three dock workers were killed and 16 were injured. An Oakland longshoreman got hold of the photos, but fears losing his job if he speaks on camera. He learned that some of the same types of containers had arrived here in Oakland Monday morning.

The longshoreman said, "At 8 o'clock this morning we got the word that the containers that were over at SSA were actually some of the containers that were on the list that weren't supposed to get here."

There was a list of refrigerated containers that had been serviced in Vietnam with an unstable form of freon according to the longshoreman's union. They say that's why they exploded.
"They have apparently taken at least three lives and may have injured many more people," said ILWU spokesperson Craig Merrilees.
They were supposed to be taken out before coming to the U.S. The ILWU says they were not and thousands of them are either in ports or out on the water.
"There are potentially thousands of containers being shipped around the world, some that have ended up on docks here in Oakland, they're potentially lethal," said Merrilees.
There are also reports of refrigerated containers exploding in China and Brazil since Thursday. Hundreds of longshoremen on Monday refused to unload any ships or move any containers until those improperly serviced in Vietnam are removed.
"I think we know that at least two terminals, both the SSA and TraPac terminal have been shut down," said Merrilees.
The longshoreman who wanted to remain anonymous said, "Until we get it resolved were not going to work."
If the longshoremen don't work, neither do the truckers. With the terminals closed dozens of trucks line the roads of the port unable to load or unload.
A trucker ABC7 spoke to also wanted anonymity. He said, "I was supposed to turn in my empty containers in and then take loads out and I couldn't do anything." When asked how long he had been there stuck in line, he said, "All day."
So far the U.S. Coast Guard has isolated at least 13 of these problem containers, but they're looking at the same issue in Tacoma, Washington, Portland, Oregon, and in Long Beach.
The Pacific Maritime Association, the longshoreman's union and the shippers are all trying to get together to work this issue out and get the cargo moving.


(Copyright ©2011 KGO-TV/DT. All Rights Reserved.)

Coast Guard Detains Egyptian Cargo Vessel for Safety and Security Violations.

The following is a press release from the U.S. Coast Guard dated 01 NOV 2011.
(PORTLAND, Ore.) -- Coast Guard Sector Columbia River detained a foreign freight vessel for failure to comply with international and domestic regulations regarding safety, security, and environmental protection.

Early last week, while preparing to cross the Columbia River Bar, the 734-foot Egyptian cargo ship EDFU experienced a significant reduction in propulsion power. The vessel’s crew conducted an emergency anchoring operation until assist tugs could arrive on scene. Over the ensuing hours, the Coast Guard worked with the Columbia River Bar Pilots Association and local area response tugs to bring the vessel safely to berth in the Port of Astoria, Ore.

Shortly thereafter, Coast Guard inspectors from Marine Safety Unit Portland attended the ship in the Port of Astoria to investigate the loss of propulsion and ensure the vessel’s compliance with other safety and security regulations. While onboard, the inspectors discovered numerous deficiencies including cracked and deteriorated firefighting piping which prevented the ship’s crew from being able to respond to a fire aboard the ship. Furthermore, the vessel failed a critical security inspection and was not in compliance with its Security Plan. Capt. Bruce Jones, Commanding Officer of Sector Columbia River and Coast Guard Captain of the Port, issued an order detaining EDFU until all safety and security measures were corrected.

“EDFU’s failure to comply with numerous provisions of the SOLAS (Safety of Life At Sea) Convention, the ISPS (International Ship and Port Facility Security) Code and the ISM (International Safety Management) Code are unacceptable,” said Capt. Jones. “The economic vitality and security of our region depend upon the majority of maritime industry members who fully abide by U. S. and international safety, security and environmental standards. The Coast Guard remains committed to protecting our region by actively preventing and responding to any and all maritime threats.”

The ship has since come into full compliance with all security measures and has made substantial progress towards fully repairing the firefighting piping system and its associated components.

This case is an example of how the Coast Guard protects our nation’s maritime transportation system from substandard ships, and protects our ports and vital natural resources from accidental or intentional discharges of oil or hazardous material. The Coast Guard Captain of the Port will continue diligent oversight of all vessels subject to international and domestic laws and treaties to ensure they continue to comply with all applicable safety and security regulations in order to protect the people of our community, our environment, and our ports.

10000 Ships to Use LNG Propulsion by 2020?


This report comes from from MEC Intelligence. The impact of this suggests phenomenal growth (over 9000% growth) in LNG use for maritime propulsion. This growth over the next eight years could very well change the face of marine engineering.

LNG in marine propulsion: A Disruption to the Maritime Industry?

According a new forecast by MEC intelligence nearly 10,000 vessels could be adopting LNG propulsion by 2020 triggering a huge growth in the market. Companies in all aspects of the maritime value chain– oil majors, terminals, ports, bunker suppliers, service companies, component producers, vessel owners and charterers – need to rethink their offerings.”

A ground breaking report published by the maritime cleantech market insight firm MEC Intelligence estimates more than 5% of the world fleet will adopt LNG propulsion by 2020 a huge growth considering less than 100 vessels presently.

Best Option for Newbuilds

Strict environment regulations requiring the reduction of SOx, NOx to 0.1% in ECA zone in 2015 and 0.5% globally in 2020 will stimulate demand for technologies that can eliminate or reduce emissions from vessel exhausts. The key compliance options available are either adoption of new types of fuel – low sulphur MGO or LNG – or using scrubber technology on the existing HFO fuel.

The LNG propulsion technology will potentially gain massive traction in the new build segment owing to significantly lower operation costs leading to a lower total ownership cost over the ship’s lifecycle. The total ownership cost over ship’s lifecycle for a new build LNG propelled vessel (depending on vessel type and geography) is expected to be up to 40% lower as compared to that of a fuel oil and MGO propelled vessel.

The low cost are attributed to the abundant availability and competitive prices of LNG compared to crude. Even though, the price of LNG is expected to increase with the pickup in natural gas demand in power sector it is not likely to be significant considering the new supplies from unconventional gas reserves.

Further, considering the often more than 25 year long life cycle of vessels, LNG adoption makes the ship essentially future proof in terms of further regulatory driven emission reductions in SOx, NOx, and Particulate Matter approaching in the horizon.

Huge Long Term Impact Albeit a Slow Start

Better Economics combined with development of building capacity, recent advancements in engine and fuel gas technologies are leading to a pick-up in the interest in LNG propulsion. Although availability of infrastructure and standards is a limiting factor, yet, this is expected to be only a short term inhibitors. An analysis of the existing LNG supply and terminal infrastructure shows ample availability of the fuel to be able to supply and bunkering infrastructure can be developed rapidly to meet the growing fleet.

With the development of infrastructure and IMO ratifications the fleet is expected to reach up to 1,000 vessels by 2015 but pick up rapidly to grow up to 10 times in the subsequent five years as the technology, infrastructure, and economics stack equivocally in favour of LNG propulsion. However, in case infrastructure and regulation are delayed the penetration is estimated to be significant lower yet still significant.

Unique Opportunity to Differentiate and Shape the Market

The report concludes that the adoption of LNG in vessels will call for changes in all aspects of the value chain – oil majors, terminals, ports, bunker suppliers, service companies, components suppliers, owners and charterers – requiring companies to rethink their offerings and align to a new reality sooner or later. It is one of the unique times when companies can move fast to take advantage of a new technology to differentiate themselves in the largely ‘commodity’ market for equipment and services.

About MEC Intelligence

MEC Intelligence is a leading market insight firm focused on growth in the maritime, energy, and cleantech sectors. The company brings together its unique data assets, deep experience in supporting strategic and market business development, and broad industry knowledge to develop objective perspective on industry developments and identify growth opportunities for the entire maritime, energy, and cleantech ecosystem.

Saturday, October 29, 2011

How Significant is One Company?


It is not often that I write about a specific shipping company, however today I feel that this one is worth mentioning. There is more to this article than just one shipping company, there is a more important issue for people to think about. In a time where it is commonplace for companies to be "delisted" by the New York Stock Exchange (NYSE)  or the NASDAQ there is significance to the fact Horizon Lines was delisted from the NYSE.

What is it about Horizon that makes this so significant? The short answer is the Jones Act of 1920. Horizon lines is one of the largest Jones Act cargo carriers in business today. What the Jones Act does is restrict domestic cargo to U.S. manufactured, U.S. owned and U.S. crewed vessels for interstate cargo.

Horizon shares traded (at the time of writing this article) in the .24-.25 range, whereas in January, shares were trading at 52 week highs of 5.95. While I don’t believe this company is in serious trouble, its stock price has put its future in question.

If a foreign company were to come in and purchase this company, it would be one less Jones Act Carrier to become history. (Remember must be U.S. owned) This would mean, assets would be sold or moved and the remaining Jones Act Carriers would pick up the slack. Demand for shipping would go up, because there would be less supply. Prices would go up for shipping, and then eventually tacked on to the products each of us buys.

The government isn't helping either. Refer back to the blog article regarding the implementation of fuel usage fees on October 19, 2011. With the expansion of the definition of U.S. Waterways in the proposed fuel usage fees could in fact change the scope of the Jones Act.

The bottom lie is that if Horizon lines disappears from the list of Jones Act Carriers, it wouldn’t be the end of the shipping industry within the United States. However, there are many overlapping factors that get overlooked. If the operating costs are increased for carriers, companies that are struggling could be forced out of business. Because of the economic crisis, our elected officials are scratching their heads trying to uncover more funding. A fuel usage fee, or expansion of areas covered could give the government more funds to resolve the debt crisis. When a congressman, or senator or even the president says "this will provide millions if not billions" I submit that they have not researched the overarching effect to companies like Horizon who are struggling to come back from the last crisis caused by inappropriate legislation.

I'm thinking about this stuff, are you?

K.Swanson