3927 Propeller Sept 08 with DVD:Layout 1
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3927 Propeller Sept 08 with DVD:Layout 1
| issue 21 propeller Oct 08 this issue Dry bulk boom Stormy waters ahead Newbuilding Full steam ahead in Asia Regulatory VOC rules tighten PSPC Unnecessary duplication causes delays Foreword Welcome to the latest issue of Propeller. As head of International Paint’s Asian operations based in Shanghai, it is my pleasure in this issue to outline some of the challenges, and the opportunities, presented to us in this part of the world. This is a particularly exciting time: a period of dramatic shipbuilding expansion across our whole region. Such rapid growth in shipyard capacity naturally raises issues. There are concerns over health and safety; there are correct procedures to be implemented and there is a growing challenge in terms of regulatory compliance. What is clear is that commissioning the hardware is the easy part. Appropriate software systems and experienced human resources are far more complicated issues and, as in other sectors of international shipping, the shortage of well-trained personnel is a constant concern. International Paint has a clear strategy of working in close partnership both with its ship owner and shipbuilder clients. We are here to help you address some of the issues. Together, we can make a real difference. In the following pages, I hope it will become clear that we are tackling today’s challenges fairly and squarely. Environmental issues are right at the top of our agenda. VOC emissions, for example, are a key focus and we are helping others in the implementation of IMO’s PSPC regulations. Meanwhile our latest hull coatings are doing their bit for reduced shipboard emissions. To find out how we can support and provide solutions to your current issues, please contact us. Our partnering strategy is a core element of our business philosophy. Colin Tan Director and General Manager India South East Asia and China (ISEAC) Contents 04 06 08 10 14 16 18 Dry bulk boom - stormy waters ahead? 20 Business update issue 21 Full steam ahead in Asia Tankers to bulkers - a quick fix Regulatory update PSPC - unnecessary duplication causes delays Vela VLCCs in Intersleek® vanguard Highest volume solids SPC coating leads to best of both worlds! Contact Editorial enquiries: Cathy Stephenson [email protected] Press enquiries: Jim Brown [email protected] International Paint Limited, Stoneygate Lane, Felling, Gateshead NE10 0JY. Tel: +44 (0)191 469 6111 Fax: +44 (0)191 495 2003 www.international-marine.com Legal Unless otherwise agreed in writing, all products supplied and technical advice or recommendations given are subject to the Conditions of Sale of our supplying company. Any warranties, if given, are contained in those standard Conditions of Sale and are the only ones made with respect to any products we sell to you or advice or recommendations we give to you. and International® and all products mentioned in this publication are trademarks of, or are licensed to, AkzoNobel. © AkzoNobel, 2008 Cover image Trustee, Cosco Shipyard. Courtesy of Dockwise propeller issue 21 | oct 08 03 Dry bulk boom – stormy Shipping analysts have been caught out recently more times than they care to remember. Probably for the first time ever, all of shipping’s main markets have peaked simultaneously, but nobody predicted the boom or the industry’s record earnings in recent times. However it is the dry bulk market that has confounded market watchers the most. The staggering scale of demand for major bulk commodities such as iron ore and coal has propelled bulk carrier rates to unimaginable levels and has fuelled a contracting boom that has exceeded all expectations. cannot be stopped in the short run. True, they say, China’s GDP growth may be easing by a couple of percentage points this year, but it is still growing in double digits and looks set to continue doing so. Of course, dry bulk shipping depends not only on iron ore and coal and not only on the surging economies of China, India and other industrial hot spots in Asia. All dry bulk commodities have been in heavy demand worldwide over the last few years as the global economy has enjoyed an unprecedented period of steady growth and maritime trade has boomed. the order book is now truly astonishing... Where does this market go from here? Unlike the container business, which relies primarily on buoyant consumer markets in Europe and the USA to keep ships full on Asian export trades and appears to be losing its lustre, the dry bulk market depends largely on imports to Asia, with iron ore from Brazil and Australia into China two of the most important long-haul dry bulk trades. There are those who believe that the close of the Olympic Games also signalled the start of a slowdown in Chinese economic growth and possibly the end of its seemingly insatiable and constantly growing appetite for iron ore. Others, however, point out that the Chinese economy is now so large, and has been growing at such speed, that its momentum Rates have been truly phenomenal. According to London-based shipbroker Clarkson, the average timecharter rate for a Capesize bulk carrier in mid August was around $135,000 a day, significantly down from peak levels of more than $200,000 earlier in the year but still hugely profitable for Capesize owners. As the Olympics were being played, rates for Capesize started climbing once again, with some brokers predicting another bull run. Panamax bulker rates were still buoyant too; also down from peak levels but still averaging more than $40,000 a day for 1980s-built ships and over $45,000 a day for ten-year-old vessels. No wonder then that bulk carrier owners have practically fallen over each other in a stampede to order new ships. The world’s shipyards already had an order backlog and many of the new bulk carriers will not 04 propeller issue 21 | oct 08 waters ahead? ... the credit crunch could well mean that some ships on order won’t actually be built deliver for at least two years or more. A lot can happen to shipping markets in that time, some brokers are warning. Some owners, frustrated by this delay, have opted for a short cut. They have chosen to convert existing tonnage, VLCCs and Suezmax tankers for example, into bulk carriers, a process that saves time and may enable them to profit from the next stage of the bulker boom. However, it would take a brave analyst to predict how long the dry bulk market will maintain its recent buoyancy. The order book is now truly astonishing and there is a very large question mark over whether the market will be sufficiently resilient to absorb this volume of new tonnage. There are darkening clouds on the horizon. Others suggest that the credit crunch could well mean that some ships on order won’t actually be built. Either the shipyards where they have been ordered, some of which don’t yet exist, won’t be able to offer appropriate refund guarantees; or owners will not be able to arrange construction finance. However, in the Capesize sector, the ships that have been ordered have been contracted by leading names at some of the world’s largest shipyards. Owners include most of the Japanese and Chinese majors, Norway’s BW Group, Rio Tinto and ThyssenKrupp AG. Builders include Universal, Mitsui, Hyundai Heavy, STX, Bohai and Dalian. It is hard to imagine, therefore, that Capesize contracts will not be honoured. The order book is larger than it has ever been in the smaller sizes too. There are more than 670 Panamax bulkers (60-100,000 dwt) on order, for example, representing almost 50% of the existing fleet; there are 900 handymax vessels (40-60,000 dwt), almost 63%; and there are more than 800 handysize ships (1040,000 dwt) representing a third of the existing fleet in this category. ...there are plenty of old Capesize vessels that should be scrapped There are for example more than 770 Capesize bulk carriers on order totalling almost 145m dwt and representing capacity greater than the whole of the existing Capesize fleet today. Of these ships, 80 are Very Large Ore Carriers, some in excess of 400,000 dwt. These ships are only suited to long-haul trades, notably the route from Brazil to China. Although that is perhaps the world’s most important bulk trade lane, there are only so many ships needed to run it. There are few other trades where these ships can be effectively deployed. Analysts point out that there are plenty of old Capesize vessels that should be scrapped over the next three years or so. Owners of older tonnage, which is probably debt-free, are unlikely to scrap their ships if rates hold up. Even if they do take advantage of record ship demolition prices, in excess of $700 per light displacement tonne in August, statistics indicate that this category of the fleet will still grow by a massive 80% over the next three years. Second-tier owners and smaller shipyards feature in the smaller size range and analysts believe it is quite likely that some of these contracts will not eventually be fulfilled. Nevertheless the numbers of ships and their carrying capacity present the industry with a massive challenge. There are other concerns too. The world’s largest iron ore miner, for example, Brazil’s Vale (previously called Companhia Vale do Rio Doce) recently announced plans for a series of 12 Very Large Ore Carriers (VLOC) of 400,000 dwt, thought to be costing more than $140m each, to be built by Bohai Shipbuilding in China. The company already has long-term VLOC charters with BW Group and Japan’s NYK. But relying on the spot market for marginal requirements has proved very expensive. At times in recent months, the cost of shipping a tonne of iron ore on spot-chartered tonnage has exceeded $100. Announcing its move to control more of its own shipping capacity, Vale blamed the cost of freight and the volatility of the market, and said the move would help to ensure a more stable delivered cost of its raw material. Vale is not alone. Other large commodity concerns including BHP Billiton, Rio Tinto and ThyssenKrupp are actively seeking to control more of the shipping capacity they need for their day-to-day business. The more control they take, the less demand there will be for independently owned bulk carrier tonnage. Meanwhile there is talk in the market that the Chinese are also disillusioned with the cost of bulk shipping capacity. After all, it is their steel mills that are paying for the imported iron ore. Although not officially confirmed, it is rumoured that the Chinese authorities are aiming for a target of carrying 75% of all their raw material requirements in nationally controlled vessels. If this proves correct and they are successful in this aim, there are dramatic implications for the dry bulk market. Few are suggesting that the bulk carrier market will collapse; Chinese and Indian demand for major bulk materials will continue to underpin it. A period of greater volatility is probable as the market struggles to absorb the massive volume of new ships. Expect some stormy waters ahead! propeller issue 21 | oct 08 05 Full steam ahead in Asia The Chinese Government’s stated aim of becoming the world’s number one shipbuilder by 2020 is well known, writes Colin Tan, Director and General Manager of International Paint, India, South East Asia and China (ISEAC). Whether it meets that objective ahead of time remains to be seen, but in any event, Asia will continue to build most of the world’s merchant vessels for the foreseeable future. According to statistics from Clarkson, South Korea, China and Japan between them account for almost 84% of tonnage on order as measured in compensated gross tons (CGT). If you add in other shipbuilders in the region, 89% of the orderbook is under construction in Asia. The order book is larger than it has ever been, having passed the 10,000-ship mark for the first time in July. As of the beginning of September, there are now 10,335 ships on order, totalling 598.8 million dwt. At the top of the rankings are the leading South Korean builders which, between them, hold the first six places. But Dalian is number seven and is followed by six other Chinese yards, before South Korea’s SLS Shipbuilding and Japan’s Oshima Shipbuilding. ... 89% of the orderbook is under construction in Asia However, the scope of Chinese expansion is substantial. Clarkson believes there are 272 shipbuilding facilities there, compared with South Korea’s 68. A recent study by analysts at HSBC predicts that world shipbuilding capacity will grow by between 50% and 90% by 2010. Most of it will be in Asia, and much of it in China. Vessels have already been ordered at shipbuilding facilities that are still on the drawing board. Whether the capital will become available and whether those new yards will be able to offer appropriate refund guarantees remains to be seen. However, as a leading marine coatings company, we must be prepared for all eventualities. We must be in a position to supply and service all of our 06 propeller issue 21 | oct 08 potential customers – shipyards, shipowners, managers and operators. Massive investment is pouring into the expansion of existing facilities and the development of new ones. A whole new generation of smaller secondary building facilities in China is seeking to follow in the steps of the industry leaders whose standards have improved markedly over the last five years. Secondary yards, however, are still some way behind so far as build quality is concerned although standards are improving all the time. The Government, meanwhile, is taking a tougher stance on environmental issues such as emissions (see page 10) and health and safety. A range of facilities accustomed to building small vessels effectively on the beach have been closed down. The Government, meanwhile, is taking a tougher stance on environmental issues... aboard all ships, however developments in coatings technology can certainly extend drydocking intervals beyond five years. Shipping’s authorities are already considering seven-year docking intervals as an intermediate step towards ten-year cycles, and certainly there is no reason why coatings should constitute a constraint in this respect. The challenge for those of us involved in this unprecedented expansion programme is to develop not only the facilities themselves, the shipbuilding infrastructure, but also in parallel to ensure that when these new yards open for business, they have appropriate systems and procedures, and most importantly of all, a well-trained and experienced labour force. It is this “software” that will provide the key to building good ships in the years ahead and is a major challenge throughout Asia as the global supply of shipbuilding labour is stretched further. It is here that we are helping both our shipbuilding clients and our shipowning customers. We are investing substantial sums in recruiting experienced Technical Service personnel; in training our existing staff; and in expanding our network throughout the Asian region. We now have some 350 full-time Technical Representatives in China alone – many are highly trained NACE and FROSIO certificated employees but, of course, others are relatively new to the business and we focus significant resources on continuous training and career development programmes. I don’t believe that any other coatings manufacturer has invested as much as we have in developing this crucial resource. Our technical staff are a vital component of our business model. Modern shipbuilding techniques may not necessarily improve build quality, of course there are regular maintenance requirements All the talk may be about China today but shipbuilding gravitates with increasing speed to regions with low labour costs. Look back over time: the UK lost its lead when Japanese shipbuilders offered greater efficiency and higher productivity. South Korean yards gained the whip hand when their workforce was substantially cheaper. China will remain a shipbuilding force for many years to come but new shipbuilding ventures elsewhere in Asia are already developing fast, for example in Vietnam, India and the Philippines. Working in some of these areas, I freely admit, is sometimes fraught with difficulties. We have strict guidelines on the way in which our business is conducted. These are set out in our Corporate Social Responsibility (CSR) policy and we must always adhere to them strictly. But our CSR principles also lay out the basis on which we co-operate closely with business partners. In Asia, that is exactly what is needed. Our current plans: • Recently relocated our Worldwide Marine Newbuilding Business Development team to Shanghai to be close to both established and emerging shipbuilding markets; • Continuing to develop and expand our human resources throughout Asia, particularly in a technical service context; • Monitoring new yard developments in China and working closely with these facilities to assist in effective coatings management and regulatory compliance; • Expanding our operations in Vietnam. AkzoNobel’s acquisition of ICI enables us to develop a new manufacturing site. We already have a business co-operation contract with Dong Nae but additional manufacturing space would be a help. Our business in Vietnam has expanded by more than 50% over the last five years and the country holds significant potential in the future; • Focusing on offshore business in India. Many international drilling companies have been drawn to the potential of the country’s Bombay High offshore field which supplies the lion’s share of domestic production. Run by the Oil and Natural Gas Corporation (ONGC), Bombay High is some 160 kms off the coast, near Mumbai. The ICI acquisition means we have new factories in Mumbai and Calcutta; Although Indian marine business is still relatively small, resources have been restructured to focus on newbuilding and the training of personnel by central experts has been a key element to strengthening our business in India. Our latest coatings offer significant fuel-saving and anticorrosion benefits for offshore craft servicing the rigs, both in a newbuild and repair context; • Watching developments in the Philippines where our distribution is currently handled through an agency agreement and large projects managed from South Korea or Japan. propeller issue 21 | oct 08 07 ... some owners are being attracted by a quick scrap sale at record prices, yielding as much as $20m or more 08 propeller issue 21 | oct 08 Tankers to bulkers a quick fix “Nobody is quite sure of the numbers but the sizzling Capesize market has proved the catalyst for a range of conversion projects, often involving single-skin tankers which would otherwise have to be phased out between now and 2010” says Rob Taylor, International Paint’s Bulkers Market Manager. There are three principal reasons for the uncertainty. Firstly suitable shipyard slots are hard to find. Secondly conversion finance is proving more difficult to pin down as a result of the credit crunch and thirdly some owners are being attracted by a quick scrap sale at record prices, yielding as much as $20m or more. However, a conversion sale is typically worth twice that and from the statistics that are available, it appears that more than 50 singleskin VLCCs have now been sold for bulker conversion projects. About 20 conversions had already been completed by the middle of this year but plenty more VLCCs will be re-commissioned with a new identity in the months ahead. Such projects present a significant challenge from a coatings perspective but International Paint has already been involved in several such deals and has been signed up to supply coatings for three more deals in the future. In 2002, the company supplied coatings for the converted Doroussa, owned by Dileton Maritime SA, in a project completed at Nantong Cosco KHI Shipyard in China. The Tamara and Corcovado owned by Cardiff Marine Inc., were converted in 2003/2004 at Chengxi Shipyard in China and last year, the Astro Lyra, owned by Angelicoussis Kristen Navigation, was converted at Shan Hai Guan Shipyard also in China. According to International Paint’s Rob Taylor, who oversees the bulk carrier coatings business, these projects involve a range of different coatings and a large volume of paint, typically 250,000 litres or so. Cleaning the existing steel after oil is a challenge and, underneath the sludge, anorobic corrosion may well need special treatment. Coatings that are typically used in these projects include Intershield®803 for cargo holds; Interbond®808, a surface tolerant highbuild pure epoxy for ballast tank repair and new steelwork; and Interbond®201 for void spaces. ... a tanker conversion project can be completed relatively quickly What’s the attraction? Well, apart from a typical sale price of around $40m, a tanker conversion project can be completed relatively quickly, enabling an owner to make the most of the buoyant bulk market. Whereas a contract for a new Capesize bulk carrier signed last year would probably not result in a ship delivering before 2010, a conversion, at a repair yard, rather than a newbuilding facility, can be completed in 12 months or so. propeller issue 21 | oct 08 09 Regulatory update Global regulatory framework tightens The impact of human activity on the environment is under closer scrutiny than ever. The marine transportation sector is no exception. A raft of new regulations have implications for ship owners, builders, repairers and suppliers such as engine builders, navigation equipment suppliers and coatings companies. Specifically in relation to coatings, new regulatory measures are having a significant impact on the industry’s traditional procedures. Shipyards face a particularly taxing time. Not only are they implementing new systems to comply with the International Maritime Organization (IMO’s) Performance Standards for Protective Coatings (PSPC) (see page 14), but shipyards in certain parts of the world are also facing new regulations on ... shipyards face a particularly taxing time Volatile Organic Compound (VOC) solvent emissions. Experts in the coatings regulation field note that there is a trend for more regulatory activity in traditionally unregulated regions outside of the European Union and the US. Asian nations, in particular, are looking closely at environmental issues. A new environmental ministry has been set up in China, for example, which will have a mandate to introduce environmental legislation for ratification by the People’s Congress. Elsewhere in Asia, there are environmental initiatives in Hong Kong, Singapore, Japan and South Korea. Any resulting legislation will have significant implications for all sectors of the maritime transportation business. Watch this space! Antifouling Convention enters into force ... a significant number of nation states have still not signed up to the Convention 17th September 2008 is a crunch date for any ship owners who still have tin-based coatings on their ships’ hulls. The IMO’s International Convention on the Control of Harmful Antifouling Systems on Ships (2001) comes into force on that day and although a significant number of nation states have still not signed up to the Convention, there are serious implications for owners of internationally trading vessels. The new measure applies to all ships under a signatory’s jurisdiction, either flying its flag or under effective control from that state. But significantly, it also applies to all other vessels entering a port, shipyard or offshore terminal falling within the jurisdiction of a signed-up state. 10 propeller issue 21 | oct 08 Many ship operators are already in full compliance with the rules which require that any harmful organotin biocides – notably tributyltin (TBT) – should either have been blasted or sealed by 1st January 2008. Individual signatories have been entitled to extend this date to 17th September 2008 but not beyond. Compliance requires ships to carry a valid International Antifouling System Certificate issued by an appropriate authority – a flag state or an appointed classification society. Any non-compliance will result in delay, detention, possible fines and possible future exclusion. “Good house-keeping” required as VOC rules tighten Newbuilding shipyards and repair facilities face a growing challenge as rules on emissions continue to tighten... and not only in Europe. Volatile Organic Compounds (VOCs), which react with other chemicals in the air we breathe to cause damaging ozone and smog and are contained in countless coatings, solvents, inks and aerosols, are climbing the environmental agenda at a cracking pace. For shipyards engaged in both new construction and repair and maintenance, there are very significant implications. So far, say experts, rules on VOC emissions are in their early stages. Regulations are really only biting in Europe and the US. But there are moves afoot in leading Asian shipbuilding nations including China, South Korea and Japan to introduce new restrictions on VOC emissions. Stricter limits across the globe are inevitable, the experts warn. Even where regulations are already in place, insiders say tighter rules should be expected on a steady timeline between now and 2020. In the European Union, regulations on VOC emissions affecting ship painting are embodied in the Solvents Emissions Directive (SED) which, for the majority of shipyards producing more than five tonnes of VOCs per annum, became effective on 31st October 2007 and is designed to monitor and limit the overall emissions from facilities where products containing VOCs are in constant use. These include sites such as car plants, printing works and shipyards. In Europe, compliance is based on an averaging approach. High VOC products, which have low volume solids content, are offset by others which contain a lower volume of VOCs and a correspondingly higher volume of solids. For European shipbuilders and repairers, the pressure is on. Since 31st October 2007, shipyard owners must demonstrate compliance when requested by authorities, and those who have not addressed the issue run the risk of SED non-compliance which could result in fines or penalties. David Mather, International Paint’s in-house VOC expert, explains, “Shipyards need to have a system in place, running constantly and perhaps based on a fairly simple spreadsheet, which monitors the volume of products used and the relative VOC content of each one.” “If they use products which contain a high volume of VOCs,” he says, “they must find ways of offsetting them, perhaps by changing their product mix or even by recycling wash solvents and waste paint materials. If they need advice, we can help them.” The rules are complicated but work like this. Individual facilities, boatyards for example, which emit lower volumes of VOCs between 5 and 15 tonnes a year must meet a percentage equating the mass of VOCs to the mass of VOCs plus solids, of 36% or less. Shipyards, on the other hand, which are likely to produce more than 15 tonnes of VOC a year, must comply with a stricter percentage level of 27% or less. Member states can impose stricter limits if they wish but these percentage levels are representative across Europe, at least for the moment. ... VOCs may have to be cut by a further 50% if 2020 targets are to be met in time However Mather warns to expect tighter rules in the future. The Clean Air for Europe (CAFE) study, for example, sets out stricter guidelines and, he says, VOCs may have to be cut by a further 50% if 2020 targets are to be met in time. Meanwhile in Beijing, the Olympic Games have brought Chinese air quality directly into the spotlight. So far the Chinese authorities appear to be keeping their powder dry so far as shipyards are concerned. But they are definitely monitoring developments carefully. No specific regulations are in place yet for shipyards but experts believe VOC limits are likely to be introduced sooner rather than later. Hong Kong’s proposed VOC regulations are less flexible than Europe’s averaging strategy. They are considerably tougher, say experts, although they are thought to be easier to police. The Japanese, meanwhile, are negotiating with industry over what approach to take to reduce VOC emissions by the agreed government target of 30%. The South Koreans have adopted a “voluntary” approach. The Ministry of the Environment is working with nine major shipbuilding groups to cut 2006 VOC emission levels 30% by 2011. Just how “voluntary” this arrangement turns out to be will only become evident in the months ahead, observers say. propeller issue 21 | oct 08 11 Draft crude oil tank standard under discussion The International Paint and Printing Ink Council (IPPIC) is taking the lead in crude oil tests required for consultations over a new performance standard for protective coatings used in the cargo oil tanks of crude oil tankers. The new measure, likely to be similar in structure to PSPC, is up for imminent discussion at the IMO. There have been some issues over test procedures, however, with Intertanko and the International Chamber of Shipping proposing that sulphuric acid should be added to crude oil samples to mimic acidic conditions in tanks. This however only applies to areas of corrosion in pits in uncoated tanks, such conditions not being present in tanks coated with a good epoxy paint. Coatings manufacturers were therefore reluctant to agree to this, pointing out that sulphuric acid is very aggressive and, in any case, would not mimic actual conditions as it is not present in crude oil. As a compromise, it was agreed that two sets of tests would be undertaken, and the results compared in due course. In tandem, the Japan Paint Manufacturers’ Association (JPMA) is running a similar test programme in Japan, with input from IPPIC. We expect to be able to report on the latest developments more fully in the next issue of Propeller early next year. ... sulphuric acid is very aggressive They proposed that IPPIC tests should be carried out in accordance with normal procedures. Ballast water management gains its own momentum Ask an anchovy fisherman in the Black Sea how his business has fared over the last 20 years, and you may get more than you bargained for. What was once a key part of the staple diet for people living around the coast in that region has become an expensive delicacy. The reason? The invasive comb jelly, or Mnemiopsis leidyi, from the US which eats anchovy eggs and very young fish. This is only one example. The transfer of harmful aquatic species in 12 propeller issue 21 | oct 08 ships’ ballast water has devastated the lives of many across the globe. It is no new problem – in fact, the IMO has been discussing the issue for two decades. Over that time, scientists have deplored the inertia, just as the problem has multiplied. In February 2004, the IMO finally adopted the “International Convention for the Control and Management of Ships’ Ballast Water and Sediments”. However, despite widespread acknowledgement of the threat, more than four years on, only 14 nations representing 3.55% of world tonnage have signed up to it. To enter into force, the Convention needs 30 nations representing 35% of world tonnage to have signed up and that looks like a distant goal. ... some countries have become so frustrated that they are adopting their own rules Some countries have become so frustrated that they are adopting their own rules. Norway is setting the pace but others are not far behind, requiring some type of ballast water management system to be in operation on board ships calling at their ports. Expect the pace to quicken – the patience of maritime nations affected by aquatic aliens is running out! All antifouling biocides under scrutiny The entry into force in September this year of the IMO-AFS (International Maritime Organization – Antifouling Systems) Convention which includes a global TBT (tributyltin) ban heralds a new era in which any harmful biocide can be brought forward to IMO for restriction on a global basis. This will bring all biocides, including copper compounds, the primary biocides used in modern biocidal antifoulings, into the spotlight. Copper use in antifoulings is already under review by the US Environmental Protection Agency (EPA) and within the European Union as part of biocidal product legislation. The Californian State EPA is leading the way in the US by reviewing the use of copper in antifoulings for US Military vessels and pleasure craft paints and has declared that copper levels in certain high-density marinas in California are too high. The US Environmental Protection Agency will re-review copper as an antifouling biocide, although the results of this review have been delayed beyond 2010. Elsewhere, in China, the State Environmental Protection Administration has issued a proposal to ban the use of copper in antifoulings from 2012. Copper suppliers and paint suppliers, amongst others, are discussing this position with the Chinese authorities. In Europe, an EU-wide review of copper is being led by the French. The result of this review is anticipated in late 2010. ... copper levels in certain high-density marinas in California are too high EU’s “REACH” embraces coatings manufacturers The Registration, Evaluation and Authorisation of Chemicals (REACH) – came into force on 1st June 2007. The EU regulation aims to improve the protection of human health and the environment from the risks associated with chemicals. Unlike previous regulations to manage chemicals, it puts the responsibility for assessing and managing the risks posed by chemicals squarely in the hands of industry. through this process an extended time period for full implementation has been set – up to 2018 for some substances. The major part of the responsibility for REACH compliance is with the manufacturer and importer of each substance. However REACH considers the full life-cycle of the product so all users of each chemical also have responsibilities. This includes coatings companies like International Paint which formulate mixtures of chemicals, such as paint. Shipyards, applicators and all users of paint will also see ... to improve the protection of human health & the environment Under REACH all uses of all chemical substances – including those used in paints – have to be risk-assessed and shown to be safe. However with an estimated 30,000 substances across the EU having to go changes due to REACH as they will receive improved safety data sheets containing better information on safe handling of products. At present REACH is at the stage known as “pre-registration”. This is the process by which substances currently in use are identified to the new European Chemicals Agency. Pre-registration for most substances will take place between the 1st June 2008 and 30th November 2008. International Paint is currently working closely with its suppliers to ensure that all raw materials are pre-registered and continue to be available under REACH. We do not expect any impact on products which the company supplies. The company is committed to full compliance with the requirements of REACH and the maintenance of a full range of products for all its customers. propeller issue 21 | oct 08 13 PSPC - unnecessary duplication causes delays A lack of mutual recognition on the part of classification societies is making the introduction of the Performance Standard for Protective Coatings (PSPC) more onerous for shipyards, owners and coatings manufacturers. This is the view of International Paint’s Mike Hindmarsh, Worldwide Marine Business Development Manager, who is concerned at the lack of progress on certain issues. IMO’s new standard, which already applied to tankers and bulk carriers built in accordance with IACS’ Common Structural Rules, now applies to all ships of 500 gross tons and above contracted after 1st July 2008, as well as the double-side skin spaces of bulk carriers of length 150m and more. Every coating used in ships’ ballast tanks must be tested to stringent standards and subsequently issued with a type approval certificate, not just from one class society, but from each one separately. As a result, there is widespread duplication of effort and unnecessary pressure on testing facilities all Ironically, up until a few months ago, a number of these coatings were in routine use but now can’t be applied unless they have been approved. This is inconvenient for owners and an extra headache for shipyards and their coatings inventory management. “This site, here in Felling, is our Head Office”, says Hindmarsh. “It is audited by Lloyd’s Register for Quality Assurance, our Houston facility is assessed by ABS and International Paint Korea use DNV. There’s no need to get each site audited by everyone. In addition to this we also have to get audited by class for Marine Equipment Directive (MED), TBT-free antifoulings and shop primer weld approvals. The lack of mutual recognition with respect to coating tests is making the whole process far more complicated and expensive than it need be”. an attempt to broker a reasonable compromise on stripe coats has been thrown out. This will reduce shipyard productivity and could well lead to further increases in new ship prices. Close co-operation with colleagues from the European Paint Manufacturers’ Association (CEPE) had resulted in a form of words drafted to ensure a good result after the application of stripe coats without being too prescriptive on the method used. The phrasing was a compromise inasmuch as it gave shipbuilders scope to determine the best means of stripe coat application – brush or roller, thus ensuring the best result. “Welds in a modern shipyard are mostly fully automatic, smooth and of high quality”, Hindmarsh points out. “There is no need for time-consuming and laborious application of stripe coats by brush”, he says, “when rollers are equally as effective and much quicker. Moreover, from an owner’s perspective, using brushes for stripe coats where automatic welds are smooth and of high quality is simply a waste of time which will eventually have to be paid for. Who will pay? Shipyard customers, of course!” A last-minute intervention at the IMO effectively scotched the compromise on because class societies won’t accept the results of each other’s tests. Hindmarsh says the resulting delays are causing the use of some products to be held up which is causing headaches for owners who have specified particular ballast tank coatings which do not yet have full type approval. ... there should be some measures of co-operation to make everyone’s life a bit simpler The class societies insist that they must independently test and certify each coating product if, at some later date, they could be held liable for its non-performance. However, using this logic, every component on every ship would have to be type-approved by all societies. That doesn’t happen. application which meant that brushes and rollers could be used, subject to the conditions of the welds. Supported by owner organisations including Intertanko and the International Chamber of Shipping, rollers have been deemed inappropriate as a means of applying stripe coats. “In any case”, argues Hindmarsh,“the class societies have one body – IACS – which could issue guidelines on this issue. There should be some measure of co-operation to make everyone’s life a bit simpler”, he says. What could have been a flexible approach based on reasonable compromise and common sense is now a rigid requirement that will result in slower stripe coat procedures, greater labour intensity and little or no benefit. Not surprisingly, shipbuilding nations are less than pleased. More consultation on the new regulations would have been helpful right from the outset, Hindmarsh believes. He is disappointed that 14 propeller issue 21 | oct 08 However, on a more positive note, a proposal on changes to product formulation proposed to IACS by the International Paint and Printing Ink Council (IPPIC) appears to have been favourably received in most quarters. Coatings manufacturers need some flexibility to allow small variations in product formulations in different parts of the world, without having to carry out separate tests on each variant. coatings manufacturers need some flexibility... There are several reasons why formulations differ slightly. For example, simple ‘like for like’ raw material substitutions allow the best use of local suppliers (many raw materials simply aren’t available in every manufacturing country around the world) and slight differences in raw material levels within a formulation allow for use of different manufacturing equipment and/or manufacture of different batch sizes. Intershield®300, the ultimate anticorrosive, meets and exceeds levels of protection required in the IMO PSPC. Check out the excellent condition of MV Eleranta’s water ballast tanks, after 13 years in service.... Small variations may also be present in formulations to alter drying and application properties and ensure they are best-suited to local ambient conditions and shipyard practices. Similarly there may be a different mix ratio to suit shipyard application methods. ... manufacturers strive for continuous improvement Having said this, coatings manufacturers strive for continuous improvement and do sometimes vary the constituents of existing paints to improve performance. In such an instance, classification societies might need to be informed, even if new tests were still deemed unnecessary. The IPPIC proposal sets a framework by which coatings manufacturers will know whether they should declare a product formulation change or not; whether to inform classification societies; or whether to tell everyone and undertake new tests for the re-formulated product. IMO PSPC Compliant Intershield®300 from newbuilding, contributing to improved Safety of Life at Sea and long term protection of your assets. IMO PSPC Resolution MSC.215(82): Ballast tank coating systems to have a minimum lifetime of 15 years, in which the coating must remain in a state of ‘good’ or better as defined in IMO Resolution A744 . propeller issue 21 | oct 08 15 Vela International Marine Ltd, a Saudi Aramco subsidiary, is one of the world’s leading tanker companies. It has won a series of awards recognising its proactive approach to safety and environmental protection and has as its declared aim “to provide Saudi Aramco and its subsidiaries with safe, reliable and high quality marine hydrocarbon transportation services in an entirely environmentally sound, profitable and cost-effective manner.” No surprise then, that the company has been one of the first major tanker operators to adopt latest generation Intersleek® hull coating technology. Altogether four of its Hyundaibuilt 15-knot, 317,000 dwt VLCCs have had Intersleek® coating systems applied to their hulls so far, in addition to the Odense built 310,862 dwt, 14.6 knot, Alphard Star. Following the successful results of an Intersleek®700 application to the vertical sides of the Alphard Star, Vela opted for Intersleek®900 on the vertical sides of the Leo Star, making her the first VLCC to be coated with the company’s latest product. Since then, two more Vela VLCCs – the Pisces Star and the Aries Star – have had Intersleek®900 applied to their vertical sides and, most recently, a fifth vessel, the Capricorn Star, marks another first for Vela. She is the first VLCC to have Intersleek®700 applied to her flat bottom and Intersleek®900 to her vertical sides. Top: John Hall - International Paint Senior Marine Sales Executive and Mr. David Gilbertson - Vela's Fleet Technical Manager Bottom: Bijan Askarpour - International Paint’s Middle East Marine Manager and Mr. Talal A. Bakheet - Vela's Marine Operations Department Manager. Mr. Shamim A. Syed - Vela's Fleet Operations Manager, was at the centre of the feasibility studies. 16 propeller issue 21 | oct 08 Vela VLCCs in Here, Propeller asked for some background on the company’s philosophy with respect to hull coatings. You have so far chosen Intersleek®900 for four of your HHI -class tankers - the Aries Star, Leo Star, Pisces Star and Capricorn Star. What were the key drivers for your decision to use this hull coating? • What is your need from a fouling control system? • How does Intersleek®900 fit with Vela’s environmental policy? What hull coating was in use on their hulls previously? Prior to this, the first docking for these vessels, a conventional five year tin-free antifouling system was applied to their hulls at the building yard. Vela’s decision to evaluate this product was based on a desire to improve upon our fleet’s flexibility in meeting our customers’ requirements for the safe and timely delivery of their cargoes in a cost effective and environmentally sound manner. What are your findings on fuel consumption aboard these vessels, compared with the previous performance? The fuel consumption since the application of Intersleek®970 has been much improved. How important were the life-time savings associated with Intersleek®900 in your decision making? At Vela our watchword is safety. This goes beyond just the safety of our individual crew members. Safety encompasses the whole spectrum of our daily activities and includes safety of the environment, together with the safety of our customers’ assets and reputations. In addition to the cost savings enjoyed from the improved hull performance afforded by the application of such advanced coating systems, it also provides us with an opportunity to make a significant contribution to the reduction of our carbon footprint and vessels’ emissions in general. Intersleek vanguard ® We have noted improvements in our daily fuel consumption that indicate a return on our investment within the first twelve months of service following the application of Intersleek®970. This result is in keeping with our expectations. Do you anticipate using the coating on the hulls of other large tankers in your fleet? While foul release coatings currently represent a significant step forward in hull coating systems, we continuously monitor the market for new and innovative products that will enhance our daily operations. How satisfied were you with the competence and attention of International Paint personnel during discussions prior to application and after-sales service? International Paint personnel exhibited a high level of professionalism in all aspects of this project. QA & Have you found that the hull coating performs as well as indicated during the negotiating process? Would you recommend Intersleek®900 to owners whose ships you fixed on medium- to long-term charter? Yes, if it has the potential to assist them in maintaining their charter party obligations in a cost effective manner. propeller issue 21 | oct 08 17 Highest volume solids SPC coating leads to best of both worlds! “We are very excited about the launch of our latest pure self-polishing copolymer (SPC) coatings,” says Clive O’Leary, International Paint’s Worldwide Marine Business Development Manager. “Intersmooth®7465HS SPC, designed for newbuildings, was launched in July and Intersmooth®7460HS SPC, designed for maintenance and repair, will be launched this month. They are the highest volume solids SPCs available on the market today,” O’Leary explains. “Both products have solids content of 54%, up from the 40% contained in Intersmooth®460 SPC and Intersmooth®465 SPC. Higher solids means less volatile organic compound (VOC) content, making them far more attractive to shipyard facilities seeking to 18 propeller issue 21 | oct 08 meet tougher VOC emission regulations (see page 11). Crucially, however, higher solids content also means that fewer coats of antifouling are required. “Instead of three coats for a five-year scheme, we need only apply two,” says O’Leary. “This saves valuable time in dock, an increasingly important consideration given the pressure on repair capacity and today’s rapidly expanding fleet.” Taking a VLCC as an example, O’Leary describes the benefits, “An owner will save one day in dock and will need to buy less ... instead of three coats for a five-year scheme we need only apply two paint. The shipyard will have 90 fewer cans for disposal; there will be significantly less overspray; and there should be a reduction in VOC emissions of around 5.4 tonnes.” Advanced Duplex System O’Leary explains the background. “We are seeing increasing demand from owners who require excellent antifouling performance but who are also focused on keeping the initial investment down. Typically, they want the flexibility of a five year drydock cycle but, in many cases, they actually dock their ships earlier than this.” ... our Advanced Duplex System does not use any antifoulings based purely on rosin or CDPs We can now offer them excellent antifouling performance over the first three years of the drydock cycle, and good performance thereafter when owners typically are less concerned about potential hull fouling. These owners have lower expectations for the last two years of the cycle,” says O’Leary, “and often, the vessel may dock earlier for noncoating related reasons such as engine/shaft repairs or steel reinstatement, or perhaps there is simply a change of charterer.” The company’s leading database, Dataplan, with records on more than 198,000 drydockings and newbuildings, demonstrates that, in practice, only some container ships and large tankers go the full five-year docking cycle. Most other vessel types dock much earlier. So how does the company’s Advanced Duplex System work? “Well,” says O’Leary, “now that we have Intersmooth®7465HS SPC and Intersmooth®7460HS SPC, we are able to offer a whole new coating scheme based on two different coating technologies used over each other in the same vessel area.” “What is really important is that our Advanced Duplex System does not use any antifoulings based purely on rosin or CDPs. This means we can provide three years of first-rate performance by using a pure SPC, followed by two years of good performance from a self polishing antifouling” The Advanced Duplex System first exposes Intersmooth®7460HS SPC (or Intersmooth® 7565HS SPC for newbuildings) as the top coat of the system, providing excellent performance for the first three years (Dataplan rating of 90%). Then the Advanced Duplex System exposes a base coat of Interswift®655 which gives good antifouling performance for the remaining two years (Dataplan rating of 80%). “As the Advanced Duplex System is also a high solids package (Intersmooth®7460HS SPC at 54% volume solids and Interswift®655 at 60% volumes solids), owners and yards still have the advantage of less time in dock due to fewer coats,” O’Leary continues. “There are also lower emissions and less waste – in fact it’s the best of both worlds!” What is different from other similar systems available on the market is the fact that the Advanced Duplex System gives three years excellent performance and then two years of good performance. Other systems reverse this ratio and drastically increase the risk of fouling after only two years of the cycle, especially when they include coatings based purely on rosin, so-called Controlled Depletion Polymers (CDP), as the base coat. Gulf Marine Management (GMM) agreed to use Intersmooth®7465HS SPC on the current newbuildings in DSME as the final coat due to block stage application already been complete. “If CDPs are used as the base coat,” O’Leary explains, “then the performance after two years of the cycle will likely be very poor with a large risk of fouling growth and increased fuel consumption. This is obviously a major concern for owners who are facing record bunker prices today.” GMM are still considering the benefits of application reduction that Intersmooth®7465HS SPC will bring for future newbuilding projects. propeller issue 21 | oct 08 19 Update Charterers take note! The substantial fuel savings possible with latest generation hull coatings is catching the attention of alert charterers. Under timecharter terms, charterers foot the bill for bunkers and recently, some pretty long-term deals have been concluded. ... they can save literally millions of dollars “It’s no surprise that charterers are catching on,” comments International Paint’s Clive O’Leary, Worldwide Marine Business Development Manager. “Over the course of a long-term charter deal, they can save literally millions of dollars. We have our eye on this market sector – with bunker prices where they are today, there is significant potential.” Singapore’s Neptune Orient Lines is a case in point. It contributed to the extra investment needed for Intersleek®700 over a conventional antifouling on the hulls of container ships ordered by ER Schiffart a German owner. Qatargas is another example, insisting that Japanese LNG operators Mitsui OSK and NYK also opted for Intersleek®700 on board their chartered vessels. This has led to all of Qatargas’ 45 newbuildings being coated with Intersleek®700 on both chartered and owned vessels. International Paint wins coatings contract for US-built tankers The first Jones Act tankers to be built to IACS’ Common Structural Rules will have cargo tanks coated with Interline®994 and water ballast tanks with Intershield®300V. Owner AHL Shipping has signed up for three 49,000 dwt IMO II/III chemical tankers for long-term charter to Shell Trading Company (US). The ships will be operated in Jones Act coastal trades. The wide range of cargoes likely to be carried meant the choice of a versatile tank coating, capable of withstanding aggressive cargoes such as methanol. Interline®994 was the obvious choice. The company was attracted to Intershield®300V partly as a result of its solid in-service record and the fact that its performance falls directly in line with IMO’s PSPC regulations, a critical element in IACS’ Common Structural Rules. Al Nierenberg, Construction Manager for AHL Shipping has commented “Predictable longservice life of coatings is critical to enable the economical operation of these highly sophisticated vessels and to meeting the time charter requirements”. Andy Hopkinson, Market Manager, International Paint commented, “This is a prestigious contract and we are delighted that Interline® 994 has been selected to ensure maximum operational flexibility and predictability. AHL’s philosophy is to own high specification vessels which is evident from a fully OPA90 compliant fleet and is committed to being a leader across its market. The core values within International Paint make a perfect partnership ensuring the product and service offers meet the needs of like-minded corporate and socially responsible organisations”. Chinese yards move forward with International Paint products Close co-operation between International Paint Shanghai (IPS) and China Dong Fang Shipbuilding of Wenzhou has helped the builder to develop its business from domesticonly construction to the building of high-spec IMO II type chemical tankers. IPS was able to work closely with the shipyard’s technical personnel to implement new procedures and improve existing ones which allowed the application of more sophisticated coatings required by overseas owners. Surface preparation was one area where procedures had to be improved. To ensure 20 propeller issue 21 | oct 08 the long and predictable service lives of which latest generation coatings are capable, surface preparation and application conditions must be right. International Paint General Manager for ISEAC, Colin Tan, regards this as an ongoing challenge for coatings manufacturers in Asia. There is a whole new generation of shipbuilding facilities, he notes. However it’s not just a question of hardware, systems, procedures and experienced labour are all key elements of a successful shipbuilding operation. Mercator comes back for more Having applied Intersleek®900 to the vertical sides of the 105,000 dwt Aframax tanker Prem Pride towards the end of last year, Mumbai-based Mercator is back for more. This time, a second Aframax – the 1998-built Prem Divya – has had her entire underwater hull coated with the foul release coating. ... at corresponding engine speeds, the vessel was consuming up to 6% less fuel According to Mercator General Manager Mr Amit Agarwal, fuel consumption of the first vessel had been closely monitored. ... the coating contains no biocides, reduces emissions and facilitates faster dockings “At corresponding engine speeds, the vessel was consuming up to 6% less fuel, depending on weather conditions, after the application of Intersleek®900” Mr Agarwal reports. “We originally calculated projected savings based on a bunker price of $450 per tonne. As bunker prices are now significantly higher, our payback period gets shorter. emissions and facilitates faster dockings were also key selling points. Mercator Lines is one of India’s fastestgrowing shipping companies. It operates a diverse fleet comprising tankers, bulk carriers, dredgers and an oil rig. However, the Indian shipping company was not only convinced by fuel savings. With a strong environmental policy, the fact that the coating contains no biocides, reduces propeller issue 21 | oct 08 21 Update Australasian first! The application of Intersleek®900 to the TTLine owned fast ropax ship Spirit of Tasmania II scores a first for International Paint’s Australasian team. Not only is this the region’s first full ship application of International Paint’s premium foul release product, but it is also a first for the Garden Island Facility in Sydney, operated by Thales Australia and the paint and blast contractor Eptec Pty Ltd. The ABS-classed vessel has a total of 748 berths, with 222 cabins and 146 ocean recliners, and is deployed on a nightly service between Melbourne and Devonport, a trip of about 230 nautical miles. The voyage duration is typically around ten hours. ... the company is intent on reducing fuel consumption and emissions The project involved one of the largest areas ever to be fully blasted during a commercial docking in Australia. A hull area of 5,500m2 aboard the 27-knot vessel, built at Kvaerner Masa Yards in Turku, Finland in 1998, was blasted and recoated with Intersleek®900. The move follows a successful 100m2 trial patch on the hull of sister vessel Spirit of Tasmania I in August 2007. “We had a long period of discussion with TTLine Pty Ltd,” explains Jon Crossen, Marine Manager Australasia. “The company is intent on reducing fuel consumption and emissions from its vessels. Following eight months of successful results from the trial patch on board the Spirit of Tasmania I, TT-Line decided to go ahead with a full hull 22 propeller issue 21 | oct 08 application to coincide with the biannual docking Spirit of Tasmania II. The project is the culmination of close co-operation within our team and we are delighted to have clinched the deal with TT-Line.” The ships hull was prepared by a mixture of hydroblasting and slurryblasting, to remove entirely the existing biocidal antifouling system. Then two 125 micron coats of Intershield®300 were applied, followed by one 100 micron coat of Intersleek®737 and a finish coat of 150 microns of Intersleek®970. TT-Line are currently evaluating the vessels performance following dry docking and application of this paint system. TT-Lines Director of Marine Operations, Captain Stuart Michael has indicated that early data is looking extremely positive. International Paint does its bit! Intersleek®900 is being supplied free-of-charge to the 125 dwt “Elding”, a whale-watching vessel based in Iceland and operated by Rekyavik-based Elding Tours. The vessel, flagship of the company’s five-ship fleet, underwent a major refit which incorporated installation of a new hydrogen-powered main engine. April 2008 saw the completion of what the company describes as her “transformation”. ... pleased to be able to contribute to this environmentally inspired initiative “We are pleased to be able to contribute to this environmentally inspired initiative,” says Trevor Solomon, International Paint’s Antifouling and Foul Release Business Manager. “Maintaining a smooth, efficient and clean hull is clearly a key priority for a vessel engaged in this type of activity.” The Elding, designed for operation in the often-treacherous northern seas, was originally built in Iceland as a rescue ship. She is both safe and very stable and has capacity for up to 150 passengers. ... Intersleek®900 is being supplied free-of-charge to the 125 dwt “Elding” Success in Norway International Paint’s Nordic team scored a major success mid-year, winning a new contract to supply sea stores to Norwegian ship owners Kristian Gerhard Jebsen Skipsrederi AS. Against stiff competition, the division has secured a two year deal with an option on another two year deal covering sea stores for the owner’s 140-strong fleet. “We are delighted to have clinched this important deal,” says International Paint’s Nordic Marine Sales Manager John Knutsen. “We faced stiff competition but close cooperation between International Paint personnel means that we will now supply this leading owner once again, following a gap of some 12 years.” The Jebsen fleet, comprising about 5 million dwt, is split into three groups – bulk carriers, tankers and cement carriers. The company also has an extensive newbuilding programme under way in South Korea and Vietnam. The annual volume of sea stores paint is estimated around 700,000 litres. ... against stiff competition, the division has secured a two year deal with an option on another two year deal Competition WINNERS Thank you to all of you that sent in your comments on the last issue of Propeller and congratulations to our lucky winners! Winner Jean-Paul Luzet, Aker Yards, Saint-Nazaire Runners Up Daniela Dobrei, SC Santierul Naval Orsova S.A. Nicolas Economides, Dynacom T.M. Ltd propeller issue 21 | oct 08 23 Intersleek 900 ® Fluoropolymer foul release coating Want to improve your profits ... and reduce emissions at the same time? 6 % predicted fuel and emission savings* Intersleek®900 is a patented fluoropolymer foul release coating for all vessels above 10 knots. Exceptionally smooth with excellent foul release capabilities and good resistance to mechanical damage, Intersleek®900 can improve your profits through a 6% reduction in your annual fuel bill and enhance your environmental profile. To find out more visit: www.international-marine.com/ intersleek900 or email: [email protected] * Depending on application and in service conditions and International® and all product names mentioned in this publication are trademarks of, or licensed to, AkzoNobel. © AkzoNobel, 2008