The only specialised marine publication in Oceania that focuses on the maritime industry, from super yachts to small craft to large commercial ships, including coastal shipping, tugs, tow boats, barges, ferries, tourist, sport-fishing craft
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OCEANS CONTINUED… OIL TANKER OWNERS STRUGGLE Many oil tanker owners are struggling to survive as weak freight rates and escalating costs batter profitability. The industry is looking for ways to ride out one of the worst ever slumps. Ship owners went on an ordering spree between 2007 and 2009, bolstered by strong earnings as rates in the tanker market reached a peak of over $180,000 a day for crude oil supertankers, before economies worldwide slowed sending rates tumbling. "A lot of our very, very high quality members are currently in dire straits," said Katharina Stanzel, managing director of trade association INTERTANKO, whose members own the majority of the world's tanker fleet. Average earnings for Very Large Crude Carriers on the benchmark Middle East Gulf to Japan route – the major market barometer – are currently around $790 a day, below operating cost levels of around $10,000 to $12,000 a day, Baltic Exchange data showed. Despite average earnings sliding to negative levels in recent months and a record low of nearly -$8,000 a day, ship owners have continued to hire their tankers out, aiming to keep their vessels in employment and also ensure they are positioned in places where they can pick up further work. "We are actually paying oil companies to transport their oil," Stanzel said. Last month Frontline, one of the world's biggest tanker operators, said it may default on bond repayments due in 2015 and be forced to restructure again if the market depression continues. In November top tanker operator Overseas Shipholding Group filed for bankruptcy protection. INTERTANKO estimated that 60 percent of all VLCCs, those that trade the spot market, had accumulated losses of around $5.5 billion in the period since 2009. Many banks have been reluctant to seize vessels, which would mean they would have to operate them and instead have extended loan covenants. However, many in the ship industry expect banks to get tougher on repossessions as conditions stay poor and banks feel the pressure on their own credit lines. "The issue is the oversupply is there – we have too much tonnage. It is not going to go in a hurry," Stanzel said. The ordering boom saw owners paying up to $162 million for a VLCC in 2008, with values sliding to around $80 million currently, leaving many saddled with huge mortgages in weak market conditions, analysts say. "It's likely that the independent VLCC owners will be the easiest to get squeezed out of the market or to have to fight for the remaining cargoes in the market not bought by strategic buyers," said Designed to exceed GMDSS legislated specifications and set new standards for safety communication products. E100 / E100G EPIRB S100 SART V100 VHF Handheld Radio Basil Karatzas, chief executive of consultancy and brokerage Karatzas Marine Advisors & Co. While crude tanker market earnings have seen periods of gains since 2009, rising bunker fuel costs have also taken their toll on bottom lines. Bunker fuel costs for a VLCC on an average 30 day journey from the Middle East Gulf to Asia have gone up to an estimated $1.7 million from under $700,000 in early 2009. Tanker owners face further costs related to fitting vessels with equipment that meets new environmental regulations in coming years. Container ship Kota Lukis NEAR MISS AT THE MOUNT A near miss was narrowly averted by a ship's pilot at the port of Tauranga recently. The incident occurred while sailing the fully laden 39900tonne container ship Kota Lukis. A sudden loss of main engine power soon after the port tugs had been released saw the vessel come within 40m of the wharf at Mount Maunganui. The quick witted pilot immediately ordered the anchor be dropped and one of the tugs position itself on the starboard side of the ship. By this time the ship was pointed directly at the occupied berth. Power was restored and the pilot ordered the ship to full astern. The vessel then proceeded to an anchorage outside the port where Maritime New Zealand inspections took place. It was thought a computer error had caused the loss of power but attempts to replicate the fault failed. All products within the Safe Sea e placeable range feature user replaceable batteries. E100 / E100G EPIRB providing an operating time in excess e of 96 hours S100 SART hours operating use even after 96 fter hours in standby V100 VHF Handheld Radio survival craft radio For more Info Call Lusty & Blundell 0800 522 726 or visit www.lusty-blundell.co.nz or www.oceansignal.com Communication & Safety at Sea 70 Professional Skipper May/June 2013 VIP.S93 16 hours typical operation