New Dayang Shipbuilding Lining Up Orders Post-Restructuring

New Dayang Shipbuilding has reportedly inked a Letter of Intent (LoI) with China Development Bank Leasing for the construction of a dozen of bulkers, according to Asiasis.
The LoI was allegedly signed at the company’s inauguration ceremony on November 20 and covers the construction of 12, 63,500 dwt Ultramaxes.
The rebranded Chinese yard has risen from the ashes like a Phoenix, following a comprehensive restructuring process from the Yangzhou Dayang Shipbuilding’s bankruptcy in 2017.
Formerly private Dayang Shipbuilding has been restored as a state-operated shipbuilder, which has set sights on achieving profits in its first three years of relaunched operations.
The yard is said to have collected over 20 orders so far, including eight bulkers from CATIC International Leasing.
Based on the data from VesselsValue, the shipyard has five newbuildings under construction including three Ultramaxes for Avic Leasing, one Ultramax for Bekkers J and one Panamax under construction for an unknown Chinese owner.

BIMCO to Complete Cyber Security Clause in May 2019

Shipowner association BIMCO is developing a cyber security clause in cooperation with shipping companies Klaveness and Navig8.
BIMCO sad that the small team includes also representatives from the UK P&I Club and HFW law firm, which aim to complete the project in May 2019.
The clause will deal with cyber security risks and incidents that might affect the ability of one of the parties to perform their contractual obligations. It requires the parties to have plans and procedures in place to protect its computer systems and data, and to be able to respond quickly and efficiently to a cyber incident.
Furthermore, the clause requires the affected party to notify the other party quickly, so that they can take any necessary counter-measures. It is designed for use in a broad range of contracts, including arrangements with third-party service providers, such as brokers and agents.
BIMCO said that the liability of the parties to each other for claims is limited to an amount agreed during negotiations. A sum of USD 100,000 will apply if no other amount is inserted.
The two key functions of the clause are said to be raising of awareness of cyber risks among owners, charterers and brokers, and provision of a mechanism for ensuring that the parties to the contract have procedures and systems in place, in order to help minimize the risk of an incident occurring and, if it does occur, to mitigate its potential effects.
“In the early stages of development, the drafting team discussed if the clause should also address payment fraud. It was concluded that the risk of this increasingly common fraud is probably best dealt with at a procedural level by companies tightening up their internal payment procedures to require verification of any changes to payment details,” BIMCO added.
The clause is considered to be of great importance in the age of digital transformation of the shipping industry, especially taking into account the threats of cyber attacks.
One of the most well known examples from the industry is the cyber attack that impacted Maersk Group’s operations in June 2017.
Maersk was one of many global companies that were hit by a malware later known as NotPetya in June 2017. The company was forced to shut down infected networks to contain the impact, resulting in a considerable financial blow worth up to USD 300 million.

Euronav Wins Tanker Operator of the Year Award

Euronav was competing against Russian shipping company SCF Group and Danish counterpart Norden for the prestigious award.
“This recognizes the commitment, energy and professionalism of our operational and technical staff in what continues to be a constantly challenging environment for tanker operators. Euronav will continue to drive the highest operational standards in our role as the largest quoted crude oil tanker platform with 75 vessels,” CEO Paddy Rodgers said, commenting on winning the award.
Rodgers was one of the speakers during the Tanker Shipping & Trade Conference  held on November 20 and 21, and he believes the outlook for the tanker market is positive for 2019.
Looking ahead there are numerous opportunities to consider when preparing for 2020 sulphur cap. For Euronav the opportunity lies in the counter-cyclical, which in the case of IMO’s 2020 sulphur limit could be to buy high sulphur fuel cheap and store it. The CEO of the world’s largest VLCC owner expects 2019 to be 9/10, as explained during the industry leaders’ forum.
Floating storage is anticipated to make a big comeback, according to Ted Petrone, Vice Chairman of Navios Corporation.
One of the factors contributing to the reemergence of the trend that practically disappeared since 2016 is the reimposition of the U.S. sanctions against Iran as Tehran is expected to keep its production high and store it on board very large crude carriers. The IMO’s global sulphur cap coming in 2020 is also expected to create demand for storage of both heavy fuel oil and clean oil.
Rodgers is not a supporter of scrubber systems when considering ways of complying with the impending sulphur regulations. Key reasons behind the attitude are concerns related to low returns on upfront capital investment of USD 5 million per very large crude carrier as well the risk of pollution from scrubbers and weak regulatory oversight of the technology.
Other winners of the evening included DNV GL that won the technical innovation award, Korean Register which secured the tanker safety award, Teekay Marine Services received the environmental award and Bahri Tankers won the operational excellence award.
Lifetime achievement recognition was given to Olav Eek Thorstensen, Executive Chairman of Thome Group, while Capt Rajalingam Subramaniam, President and CEO of AET Tankers won the industry leader award.

South Korea Unveils Financial Boost for Smaller Shipbuilders

South Korea has prepared another financial boost for its shipbuilding industry with an aim to help small and mid-sized shipbuilders.
According to an announcement released by the government, South Korea plans to create new opportunities for these shipbuilders, worth around KRW 1 trillion (USD 885.3 million), through the promotion of environmentally friendly ships.
The move could see a total of 140 liquefied natural gas (LNG) powered vessels ordered at the yards by 2025, including two next year, Yonhap News Agency reported. The government’s plan also includes an investment of KRW 2.8 trillion (USD 2.47 billion) in infrastructure by 2025, including areas which would support LNG bunkering operations.
Additionally, the government would provide the financially troubled shipbuilders with KRW 700 billion (USD 619.7 million) in new financing and roll over maturing loans and debt guarantees worth KRW 1 trillion by one year.
The measures also include the extension of the period of special state support for employment in the shipbuilding industry by six months to June next year.

Maersk Line to Change Fuel Adjustment Surcharge ahead of 2020 Sulphur Cap

World’s largest container shipping company Maersk Line is planning to introduce a new fuel adjustment surcharge ahead of the 2020 sulphur cap.
As explained, the new Bunker Adjustment Factor (BAF) surcharge aims at recovering Maersk Line’s costs of compliance with the global sulphur cap, which mandates the use of fuel with a sulphur content of 0.5% instead of 3.5 %.
Maersk is pursuing the move amid expected increasing fuel costs the industry will face due to the new regulation, which are projected to reach USD 15 billion. Maersk Line alone anticipates it will have to pay over USD 2 billion more for fuel on annual basis.
“We fully support the new rules. They will be a significant benefit to the environment and to human health”, says Vincent Clerc, Chief Commercial Officer, A.P. Moller – Maersk A/S.
“The 2020 sulphur cap is a game changer for the shipping industry. Maersk preparations to comply are well underway and so are our customers’ efforts to plan ahead. The new BAF is a simple, fair and predictable mechanism that ensures clarity for our customers in planning their supply chains for this significant shift.”
The BAF replaces Maersk Line’s Standard Bunker Adjustment Factor (SBF) surcharge and consists of two key elements; the fuel price which is calculated as the average fuel price in key bunkering ports around the world, and a trade factor that reflects the average fuel consumption on a given trade lane.
Maersk Line’s BAF surcharge will be introduced on January 1, 2019, and it will be levied separately from the company’s freight rate.

ABS to Class Singapore’s First LNG Bunker Barge

The classification society American Bureau of Shipping (ABS) was selected by FueLNG to class Singapore’s first LNG bunker barge, scheduled to start construction in January 2019.
“This project is an important milestone for the region and is a key component of Singapore’s strategy to become the world’s largest bunkering port,” Patrick Janssens, ABS Vice President Global Gas Solutions, said.
“LNG as fuel has become an increasingly popular option for many shipowners looking to comply with environmental requirements and gain new operational efficiencies. Projects like this are critical to help expand the LNG supply chain and advance adoption of LNG as fuel.”
The LNG bunker barge, with 7,500 cubic meters of LNG capacity, will be owned and operated by FueLNG, a joint venture between Shell and Keppel Offshore & Marine. The vessel will be based in the Port of Singapore and will supply necessary LNG fuel to large ocean-going LNG-fueled vessels throughout the region.
To help spur the project, Singapore’s Maritime and Port Authority (MPA) recently granted up to USD 3 million to FueLNG Pte Ltd to build the vessel.
To be built by Keppel Offshore & Marine, the vessel, which is valued at around SGD 50 million (USD 36.4 million), is scheduled for completion in the third quarter of 2020.
The vessel’s key features include high manoeuvrability which enables bunkering without tug assistance, as well as propulsion and power management systems that optimise fuel consumption.

Report: VLCC Superstructure Slips into Water at HHI’s Ulsan Facility

A superstructure block of a very large crude carrier (VLCC) being built by Hyundai Heavy Industries (HHI) slipped from a barge and sank on September 15, while underway in Ulsan waters, Yonhap reports.
As informed, the huge block was underway toward HHI’s manufacturing facility in Ulsan, South Korea, when it fell into the water.
Yonhap said that the structure in question is in fact the deckhouse of the vessel, spanning 60 meters in length, 21 meters in width and 38 meters in height, and weighing 917 tons.
The structure was being transported on a 3,680-tonne barge, towed by a tugboat toward HHI’s Ulsan yard.
There were four people on board the tugboat and one on board the barge when the incident occurred, fortunately, they are all reported to be safe.
Hyundai Heavy Industries plans to send a diver to the site to assess the situation of the mega block, before moving ahead with the salvage plan, Yonhap added.
The cause of the sinking is under investigation.
World Maritime News Staff; Illustration, Image Courtesy: Flickr/SarahTz under CC BY 2.0 license