HORIZONSI

TECHNICAL NEWS AND INFORMATION FOR THE MARINE INDUSTRY JUNE 2006 Issue 16

The Greek shipowning

community continues to

lead the field in terms of

tonnage, with 8.4% of the

world’s fleet. The Greeks are

beginning to lead in other

ways as well, including the

training of staff both at sea

and ashore, public listings

and forays into ship types

such as ice-strengthened

tankers and LNG ships.

As the international shipping

community gathers in Piraeus

for this year’s Posidonia

Exhibition, we can celebrate

yet again the enterprising

spirit that makes the Greek

shipowning community such

a significant and special one.

Alan Gavin

Marine Director

IN THIS ISSUE

2 Greeks going strong

5 Lloyd’s Register EMEAopens new trainingcentre in Piraeus

6 Managing structuralconfidence with HullIntegrity

8 The future role of class in ice and coldoperations

10 The model of a modernshipping company

12 On the horizon – thelatest news

12 Exhibitions andtechnical papers

Greek owners havebeen diversifyinginto new ship typesand new trades.Pictured left,Archangel, a TEN-owned, 163,000 dwtice-class tanker.

HORIZONS June 20062

GREEKS GOING STRONG

The Greek shipping

community has ordered

new ships in record

numbers over the past

year and is becoming

more focused on issues

such as manning, training

and the environment.

The Greek shipping communityremains one of the most vibrant,active and successful in the worldand continues to go fromstrength to strength, with Greekowners expanding into newtrades and diversified ship types,as well as markedly increasingtheir existing fleets.

Greek interests control around8.4% of the world’s total numberof vessels in service and on order,or 13.7% by gt. Despite a slightdecrease in these numbers from2005, the Greek-owned fleetremains the largest in the world.

According to figures from Lloyd’s Register-Fairplay, theGreek-controlled fleet in mid-March this year totalled 3,397vessels, comprising more than 113 million gt. This totalencompasses 364 newbuildingscurrently on order, totallingnearly 16 million gt. Thisrepresents an overall increase of59 vessels, totalling more than 4million gt. The total number ofnewbuildings includes 62 oiltankers, 121 chemical andproducts tankers, 29 gas tankers,92 ore and bulk carriers, 26 purecontainer carriers, 26 cargo shipsand one passenger ship.

In addition to ordering recordnumbers of tankers and bulkcarriers, ship types in which Greekowners have traditionally beenstrong, the number of other shiptypes has also risen markedly,especially the number of liquefiednatural gas (LNG) tankers.

New entrants to the LNG marketare Maran Gas, Dynacom andTsakos Energy Navigation (TEN).Maran Gas was the first Greekowner to order LNG vessels, and itnow has four 145,700 cu m vessels.Meanwhile, Danaos has been an active investor in the newgeneration of container ships.

June 2006 HORIZONS 3

The drive of Greek owners to modernise their fleets ismanifesting itself in the steadilydecreasing average age of theGreek fleet. The average age ofthe fleet is now 15.3 years, ascompared to 15.9 years in 2005and 20.3 years in 2000.

While the Greeks have been veryactive in the new constructionmarket, they have also beenselling and buying secondhandtonnage at a frenetic pace, witha trend of entire fleets changinghands rather than single ships.Notable recent activities includethe purchase of the entireStelmar Tankers fleet byOverseas Shipholding Group(OSG) and TEN’s deal withWestern Petroleum Group toacquire the oil trader’s brand-new fleet of nine producttankers. Six of the vessels are large handymax tankersdelivered last year from HyundaiMipo Shipyard, while three arefully coated aframax tankersthat will be delivered directlyfrom the builder in May, Augustand October this year. All thevessels are of ice-class 1Aconstruction, continuing TEN’s recent expansion in ice-strengthened tonnage.Enterprise Shipping and Tradingalso recently purchasedMalaysian International ShippingCorp’s entire fleet of bulkcarriers, while Angeliki Frangoubought the entire Navios fleet.These activities clearly show a new trend in the sales andpurchase market, possiblyreflecting the confluence of firmfreight rates in most sectors,high newbuilding prices and a scarcity of newbuilding berths.

Family ties remain ever important,but as increasing numbers ofGreek shipping companies seekthe liquidity and access to capitalafforded by the internationalmarkets there has been a growingnumber of initial public offerings(IPOs), more often than not on theNew York Stock Exchange. As aresult, traditional family-centredcompany structures are being re-evaluated at the same time thatmodern corporate governancestructures and managementprinciples are being adopted.Recent major IPOs of note have come from TEN,Genmar, Quintana, Dryships, TOPTankers, Stealth Gas, Excel, EagleBulk, Genco, Global Oceanic,Golden Port and Diana Shipping.

Manning is an ongoing issue, withGreek owners placing great valueon training and bringingexperienced seafarers ashore.Training has been identified as ameans of motivating both ship andshore staff, and many companiesare using external training sources,such as classification societies, to address the need for specifictraining. A number of companieshave also recognised the need totrain their senior managers in the‘softer issues’ of management.Among these are Tsakos, Eletson,Roxana Shipping, Magna, Chandris,OSG and TEO Shipping.

Continued overleaf >

Tsakos Shipping takes long-term viewRanking among the three largest Greek shipmanagement companies and one of the 10 largesttanker companies worldwide, the history of TsakosShipping dates back to 1970, when it was foundedin Piraeus, Greece by Captain Panagiotis N Tsakos.Today, Tsakos is one of the most respected names in the international shipping industry, operating a diversified fleet of tanker, container, LNG and drycargo vessels, numbering 84 in total (includingvessels on order) and comprising 8.1 million dwt.

The company's strong commitment to safe shipboardoperations and environmental protection has beenpracticed with diligence and continuity. Accreditationunder the ISO 9002 and ISO 14001 schemes, as wellas early compliance with the International SafetyManagement Code and the implementation of anenvironmental management system and Lloyd'sRegister’s marine training provide ample evidenceof quality throughout the organisation.

Capt Tsakos explains: ''Since the establishment of ourcompany we have been working to achieve quality inour operations – quality not only in terms of profileor financial sustainability, but also in terms of youngtonnage, safe operations, capable and well-trainedcrews and sound environmental practices. Althoughwe have fulfilled many of our goals, we recognise thatthere is always considerable room for improvement;and this is where Lloyd's Register has helped us.”

Captain Tsakos is the current Chairman of Lloyd’sRegister’s Hellenic Advisory Committee, a forumwhich brings together leading members of theGreek maritime community to discuss topical issuesimpacting the maritime industry and advancecommon proposals to Lloyd’s Register’s GeneralCommittee and other industry bodies.

Apostolos Poulovassilis, Managing Director of Lloyd’sRegister EMEA’s business in Piraeus and the EastMediterranean and Black Sea areas, says: ''Tsakos has

a long-standing tradition in thetanker industry as well as a long-standing relationship with Lloyd'sRegister. We value this relationshipas one that helps to raise safetyand environmental standards, thusimproving the reputation of theshipping industry as a wholethrough good safety records anddiligent pollution prevention.”

Chairman of Tsakos Shippingand Trading, Capt Panagiotis Tsakos and Chairman of Lloyd's Register, David Moorhouse together in Piraeus.

HORIZONS June 20064

For further informationontactDavid Tozer, BusinessManager – Container Ships,Lloyd’s Register

E: david.tozer@lr.orgT: +44 (0)20 7423 1562F: +44 (0)20 7423 2213

For further information contact

Apostolos Poulovassilis,

Managing Director, Piraeus,

Mediterranean and Black Sea,

Lloyd’s Register EMEA

E apostolos.poulovassilis@lr.org

T +30 210 458 0865

F +30 210 452 8953

Gregory Hadjieleftheriadis says farewell

Eletson Corporation was founded in 1966by Vassilis G Hadjieleftheriadis, togetherwith his two sons and two sons-in-law. Currently, its fleet comprises25 double-hull tankers with acombined capacity of 1,630,533dwt. Eletson is both the ownerand manager for this fleet ofmedium- and long-range producttankers, all of which operateunder the Greek flag and areclassed by Lloyd’s Register.

On April 4, 2006, Eletson Holdings Inc announced the retirementof its co-founder, shareholder and director and EletsonCorporation’s President and CEO, Gregory B Hadjieleftheriadis,who at the age of 67 decided to leave the company and sell hisstake to the remaining shareholders.

‘’Having devoted myself to Eletson for 40 years, I am now leavingthe company with a tremendous feeling of pride and achievement,’’says Hadjieleftheriadis. ‘’I sincerely hope that my dedication andcommitment to the industry have contributed to internationaltanker shipping becoming safer and more quality conscious.’’

Apostolos Poulovassilis, Managing Director of Lloyd’s RegisterEMEA’s business in Piraeus and the East Mediterranean and BlackSea areas praises Eletson as a “first-class product tanker operator”and says, ‘’We wish Gregory all the best in his retirement andcommend him on the excellent company that he helped to build.

“Eletson is an environmentally conscious company, stronglycommitted to quality, safety and continuous improvement.Having commenced its double-hull newbuilding programme in1986, it became the first company in the world to own andoperate only double-hull tankers by 1996. We have always had a good relationship with Eletson, and I look forward tostrengthening it even further in the future.”

‘’The continuous transfer of knowledge from class that hastaken place throughout the years has been highly valued byEletson,” says John E Karastamatis, President of EletsonHoldings. “We have invested heavily in our vessels, as well as in their safe operation and the training of their crews. We strongly believe that Lloyd’s Register has assisted us inmaintaining a high level of performance and identifying areasfor further improvement.”

GregoryHadjieleftheriadis, achampion of qualityshipping, has retiredfrom the company hehelped to found.

John Skordias, Managing Directorof Chandris Hellas SA, comments,"We are certainly seeing thebenefits of putting our seniormanagement through this trainingand will be expanding this to lowerlevels of management throughoutthe company." As the effects of theTanker Management and SelfAssessment programme becomemore evident, the importance oftraining will become an evenhigher priority.

The Greek shipping communityhas evolved tremendously duringthe past few decades in terms ofits environmental awareness.Greeks are becoming increasingly‘green’ and are not only setting a good example in terms ofcompliance, but are in someinstances going above andbeyond legislative requirements.Marmaras Navigation Ltd, forexample, has adopted Lloyd’sRegister’s EnvironmentalProtection (EP) notation, for ninetankers to be built by Hyundai’s

Samho yard. The notationindicates that the ships achievean environmental standard inexcess of current regulations. The first of these ships to bedelivered was Delta Pioneer, a103,000 dwt tanker. Other Greekowners who have adopted thenotation include Tsakos Shippingand Trading and Chandris.

In the area of ballast watermanagement, OSG ShipManagement (GR) recentlyachieved a notable first bybecoming the world’s first tankeroperator to gain Lloyd’s Register’sBallast Water Management Plan(BWMP) notation for its entirefleet of 32 product tankers andchemical carriers.

Greek owners are also voluntarilyembracing management standardssuch as ISO 9001 and 14001 andthe principles of awareness andcontinuous improvement thatthese standards embody.

Greek interestscontrol 8.4% ofthe world’s totalnumber of vesselsin service and on order, makingthe Greek-owned fleet the world’s largest.

At the opening of the Piraeusoffice’s new training centre.

The new training centre canhold up to 60 delegates in atheatre-style layout.

June 2006 HORIZONS 5

LLOYD’S REGISTER EMEA OPENS NEW TRAINING CENTRE IN PIRAEUS

Training is becoming an

increasingly important part

of both routine ship and

shore-side operations. So

Lloyd’s Register EMEA has

opened a dedicated

training centre in its

Piraeus Office to better

serve its Greek clients.

For furtherinformation contactDavid Tozer, BusinessManager – ContainerShips, Lloyd’s Register

E: david.tozer@lr.orgT: +44 (0)20 7423 1562F: +44 (0)20 7423 2213

For further information

contact Dave Barrow,

Marine Business Manager,

Lloyd’s Register EMEA

E david.barrow@lr.org

T +30 210 458 0858

F +30 210 452 8958

Recognising this and to improveour service to our clients inGreece and the Mediterraneanarea, our Piraeus office recentlyopened a new state-of-the-arttraining centre. The centre waschristened with our prestigious‘Leading the Fleet’ course. Twelve delegates attended from a number of organisationsincluding Chandris Hellas SA,Overseas ShipmanagementGroup (OSG) and Teo Shipping.

The new training centre is locatedwithin our office on the Akti Miaoliand has the capacity to hold up to 60 delegates in a theatre-stylelayout. There are also dedicated‘break-out’ areas to help facilitatesmaller group activities takingplace during a training course.

“The opening of the trainingcentre confirms our commitmentto client training and demonstratesour clear objective of providingprofessional and high-qualitytraining to clients,” says ApostolosPoulovassilis, Managing Director of Lloyd’s Register EMEA’s Piraeus,Mediterranean and Black Seabusiness. "Training represents thepinnacle in our relationship withour clients, as it provides a meansof sharing information andproviding feedback which can help all involved to improve theirperformance.”

The centre is currently hosting at least one client training courseper week, with two courses a week being increasinglycommon. The majority of thetrainers are Greek and a portionof the courses are held in Greeklanguage. The centre has alreadybecome such a draw in the areathat clients from overseas often attend.

Courses on offer in the newcentre cover a range of topicsincluding technical issues,management systems andmanagement skills. Coursesrecently offered in the newtraining centre include:

• ISM Internal Auditors Course• ISPS Internal Auditors Course• Classification and Statutory

Surveys Course• Risk Management and

Incident Investigation Course• Leading and Managing

Change Course• Senior Management

Workshop.

Clients can attend ‘public’ coursesor we can tailor ‘in-house’ coursesto their specific needs. “Werecognise that every organizationhas unique training requirements,”says Poulovassilis, “and we arealways ready to discuss withowners and operators theirtraining needs and to provideinnovative training solutions.”

Currently, we have annualcontracts with Tsakos Shipping and Trading, Consolidated MarineManagement (CMM), AvinInternational SA and Euronav.

The most recent annual trainingcontract we won was with OSG.The contract enables OSG to planahead their training requirementsin detail and to match theseagainst the training courses weoffer. If there are any gaps, thenwe will work together with OSG to ensure they are closed and that the courses meet OSG’sexpectations.

Lloyd’s Register EMEA also recentlyopened a dedicated trainingcentre in Cyprus following its re-establishment on the island. The establishment of our marinetraining capability in Limassol isproviding shipmanagers with thehigh-quality training that theyrequire in a more cost-effectivemanner. Courses offered out of Cyprus include training on MARPOL Annex VI, shipemergency response and shipdesign software. ‘Classification andStatutory Requirements’, ‘ISMInternal Auditor’ and ‘ManagingChange’ are also being offeredout of Cyprus on a regular basis.

The value of effective training inimproving overall businessperformance is increasinglyapparent in today’s maritimeindustry, as new technologycontinues to develop and thetrue impact of the humanelement in safety comes to bemore fully understood. For manycompanies in the maritime sector,the capability and proficiency oftheir staff is the key element inthe efficiency and reliability ofthe services that they provide.

HORIZONS June 20066

MANAGING STRUCTURAL CONFIDENCE WITHHULL INTEGRITY

to high standards,” says ChrisHolland, Hull Integrity ProductManager, Lloyd’s Register. “The service uses simpletechniques that will helpimprove confidence in thecondition of the hull structure of enrolled vessels.”

Hull Integrity has beendeveloped following a detailedmarket analysis, which wasinitiated by Lloyd’s Register to determine ways in whichinspection regimes could beimproved. Ship operatorscontrolling a combined fleet size of over 52 million grt havecontributed to the process,including many of the leadingtanker and LNG operators. The real-world feedback, fromindividuals ranging from chiefofficers to technical directors,has enabled Lloyd’s Register to develop a practical servicethat can be effectivelyimplemented in both ship andshore operating environments.

Three service elementsHull Integrity can be brokendown into three main elements:

• training for senior ship’sofficers and superintendentsin how to carry outinspections

• ship-specific hull inspectionguides

• user-friendly software forrecording and analysis.

hull surveys, since they requirethat critical areas are identifiedand considered in advance. As a result, hull structures are subjected to multipleinspections by manyorganisations, leading toincreased downtime and costs.

Operators can gain additionalbenefit from the results of theirhull inspections if they can usethem to help satisfy thesevarious requirements. Both theyand the third parties involvedtherefore need to be confidentthat sound structural inspectionprogrammes are beingemployed.

Hull IntegrityTo help provide this confidence,Lloyd’s Register has developed anew service – Hull Integrity –which gives operators theguidance they need to helpmanage the structural integrityof their ships.

“We have developed HullIntegrity to help operatorsreduce unplanned operationaldowntime and costs anddemonstrate to charterers that a vessel has been maintained

Hull Integrity has beendeveloped to help operatorsreduce unplannedoperational downtime andcosts and demonstrate tocharterers that a vessel hasbeen maintained to highstandards.

Through its easy-to-use

tools, Lloyd’s Register’s

new Hull Integrity service

will help operators to

manage the structural

integrity of the vessels in

their fleet.

With growing pressure on the marine industry to showimprovements in standards, shipowners and operators need to beable to demonstrate high-qualitymanagement of the structuralintegrity of their fleet. Inaccordance with the OilCompanies’ International MarineForum’s Tanker Management and Self Assessment Guidelinesand the International SafetyManagement Code, manyoperators have alreadyincorporated hull inspections intotheir own planned maintenancesystems and are using the defectlists produced as a starting pointfor the preparation of repairspecifications.

As well as satisfying their owninternal needs, however,operators have to meet the hullinspection data requirements of the various regulatory andcommercial third parties.Charterers, for example, oftenrequire tanker operators todemonstrate how they identifyand inspect ‘hotspots’, and howthe results are recorded. Flagstate and class regulationsnecessitate a structuredapproach to the planning of

7

Training and support Lloyd’s Register provides thetechnical training necessary toenable senior ship’s officers andsuperintendents to carry out HullIntegrity inspections. We run athree-day Hull Inspection, Damageand Repair Course that helps ship’sstaff to understand the differenttypes of defect and damage thatcan occur in ship structures, as wellas the repair methods that werecommend for each. This course is backed up by a comprehensive CD-ROM-based Hull InspectionDistance Learning Course, whichwill help staff who find it difficultto attend formal courses, or whorequire a refresher, to improvetheir hull inspection techniques.

We have also developed acomputer-based training courseto help operators to get the mostout of the Hull Integrity software.This course covers the inspection,recording and analysis functionsof the software in detail.

Hull inspection guides When operators enrol with theservice, they receive a ship-specificHull Inspection Guide for each oftheir enrolled ships. These guidesuse extracts from ship’s plans topoint out locations within thecargo and ballast tanks that need to be looked at duringinspections, including fatiguehotspots and other areasidentified from classificationrecords, previous inspections and operator experience.

We also provide a Tank CoatingsCondition Guide to help staff to inspect marine coatings. The guide covers methods forassessing coating condition andincludes colour images of tankcoatings in various conditions,data on corrosion-prone areasand coating condition reports.

Hull Integrity is not a class-related service and is thereforeavailable to operatorsirrespective of whether or not their ships are Lloyd’sRegister classed.

“The advantages of HullIntegrity are perhaps mostapparent for operators oftankers and LNG vessels because of the regulatory and commercial third-partyrequirements that they face in particular,” says Holland. “In practice, however, it issuitable for existing andnewbuild vessels of all types. We look forward to helpingoperators to increase theeffectiveness of their existinghull inspection regimes and to realise measurableimprovements in safety as theservice becomes established.”

June 2006 HORIZONS

For further informationcontact David Tozer,Business Manager –Container Ships, Lloyd’sRegister

E: david.tozer@lr.orgT: +44 (0)20 7423 1562F: +44 (0)20 7423 2213

For further information

contact Chris Holland, Hull

Integrity Product Manager,

Lloyd’s Register

E chris.holland@lr.org

T +44 (0)20 7423 1768

F +44 (0)20 7423 2056

Section from a typical HullInspection Guide, whichidentifies fatigue hotspotsand other areas to beexamined during inspectionof a specific ship.

Hull Integrity software The software we provide for useonboard ships helps operators toobtain maximum benefit from theinspections and their results. Priorto inspection, the programgenerates inspection checklists toprovide inspectors with guidanceon where to look and what to lookfor, and it contains simpletemplates to help them recordresults. These are then uploaded toa secure database on the internet.Stored data can be reviewed andanalysed by superintendents and, if they wish, operators can giverestricted access to charterers andother third parties.

The software includes features suchas a defect and repair list generator,which can help operators to produce drydock repairspecifications. It is designed to beextremely easy to use, and avoidscomplex three-dimensional models.

Benefits of the service“Operators can benefit from HullIntegrity in a number of ways,”says Holland. “By encouragingmore effective inspection andrecording procedures, the servicecan lead to a reduced risk ofstructural failure and this, in turn,can help to improve safety andstructural confidence. It can alsohelp to increase fleet availability byreducing the amount of downtime,both planned and unplanned.”

In addition, the identification ofdefects and deterioration early oncan help operators to take timelypreventative action, producemore accurate repair budgets andmake improved long-term costforecasts. Users of the service willfurther benefit by being able todemonstrate that their ships aremaintained to high standards,helping them to satisfy bothcharterers and financiers.

HORIZONS June 20068

THE FUTURE ROLE OF CLASS IN ICE AND COLD OPERATIONS

Ice and cold operations

are beginning to demand

something more from

class than the application

of prescriptive rules.

The dynamics of ice and coldoperation are changing, as ice-class vessels grow in size andnew players enter a marketpreviously populated exclusivelyby specialist ship operators.These changes are being broughtabout by the increasing exportvolumes of oil out of ice-boundRussian ports.

As a result, there is now a needfor class to deepen its capabilityto address other aspects of iceand cold operations.

“In response, we are developingwinterisation guidance andservices which will help ownersand operators to addressconfidently all aspects of ice andcold operations, from specifyingice class in the shipyard tooperation and finally todecommissioning at the end ofthe ship’s life,” says Rob Tustin,Technical Manager for NewConstruction, Lloyd’s Register Asia.

The three elements Ice and cold operation comprisesthe confluence of three principalelements:

• the ice and cold regime• the ship operations• the ship.

Ice and cold regimeThe ice and cold regime consistsof the prevailing environmentalconditions and the icemanagement offered by therelevant national authority. The environmental informationincludes temperature, icethickness, pressure, degree of iceridging, duration of ice season,wind and weather, currents andpresence of land-fast ice. The icemanagement includes icebreakerassistance, the availability of iceforecasts and the provision ofrouting advice.

The ice and cold regime will havea profound impact on the designand operation of a ship. Therewill be implications not only forthe choice of ice class, but alsothe types of winterisationmeasures applied to the designand operation of the vessel.

Ship operationsShip operation in ice requiresexperienced seafarers who areexperienced in the trade and – as in other specialised sectors ofthe shipping industry – these arein short supply.

The risk of damage to the hull of a vessel operating in ice is a combination of factors such as the ice sheet thickness,pressure in the ice sheet,encounters with ice ridges and large ice pieces and themanoeuvring and speed of the vessel in ice.

Particular care is needed whenentering the ice field, andoperating a vessel in broken icerequires careful control toensure that the hull, rudder andpropeller are not damaged.

Icing is a specific issue for vesselstrading in cold regions, and theship’s master needs to applymeasures to combat this and tobe aware of the effect icing willhave on the vessel’s stability andoperating draft and trim.

ShipShips which are tailored for ice andcold operation, i.e. ice-class ships,differ significantly in some respectsfrom ships specified for normaltrades. Visible features include:

• heavier scantlings in the sideshell structure in the vicinityof the waterline

• possible ice operation designof bow shape (particularly foricebreaking or multi-year-icevessels)

• larger diameter shaft andthicker propeller blade root

• ice knife to prevent possiblerudder and steering geardamage when manoeuvringastern in ice.

Typically, when hydrodynamicistsand ship designers develop a hullform for ice operation, there is a delicate balance betweenoptimising open-water as opposedto ice-going performance. Theultimate expression of thecompromise in hull designbetween these modes is thedouble-acting design adopted byNeste Oil for its aframax tankersMastera and Tempera (bothLloyd’s Register-classed), where thehull design is optimised for theship to operate in forward modein open water and for asternmode for ice navigation.

The ice and cold regime

Ice and cold operations

Ship operations Ship

The three

elements.

For further information

contact David Tozer,

Business Manager –

Container Ships, Lloyd’s

Register

E: david.tozer@lr.org

T: +44 (0)20 7423 1562

F: +44 (0)20 7423 2213

June 2006 HORIZONS 9

For further information

contact Rob Tustin,

Technical Manager –

New Construction

E robert.tustin@lr.org

T +82 (0)51 640 5010

F +82 (0)51 637 0035

The last few years haveseen a considerablenumber of ships deliveredto Lloyd's Register ice class,and many more arecurrently on order. Theabove table highlights justsome of these vessels.

Looking aheadTo adequately deal with newoperating scenarios, technologiesand trades within icy and coldenvironments, class must notonly provide basic guidance oncompliance with minimumrequirements for ice class, but gobeyond this to provide advice onoperational aspects. We areworking with industryparticipants, including existingand potential owners of ice-classtonnage, national authorities,equipment manufacturers andresearch institutes to developnew services and to formulatemeaningful guidance to helpensure that new opportunitiescan be taken advantage of whilemaintaining the safety ofseafarers, ships, cargo and theenvironment in icy and coldoperating conditions.

Owner Builder Ice class Ship type Size/capacity Delivery date

BP Shipping SHI 1A FS Aframax tanker x 6 113,000 dwt April 2005 to May 2006

Dynacom Universal 1A FS Suezmax tanker x 3 150,000 dwt September to December 2006

Hamburg Tankers GmbH DSME 1A FS Aframax tanker x 2 115,000 dwt August to December 2006

Korea Line Corporation DSME RMRS LU2 Membrane-type LNG 151,800 cu m March 2008

Lundqvist Shipping Co. Ltd. DSME 1A FS Aframax tanker 115,000 dwt May 2006

Marmaras HSHI 1A FS Aftamax tanker x 4 111,000 dwt October 2004 to March 2005

Marmaras HSHI 1A FS Suezmax tanker x 5 163,759 dwt February to October 2006

MOL, K Line and Primorsk Mitsui Chiba 1B FS (hull); RMRS LU2 Moss-type LNG 145,000 cu m March 2008Shipping (propeller and shaft)

Neste Oil Sumitomo 1AS FS Aframax DAT x 2 106,000 dwt August 2002 to January 2003

NYK and Sovcomflot MHI Nagasaki 1B FS (hull); RMRS LU2 Moss-type LNG x 2 145,000 cu m October to December 2007(propeller and shaft)

Russian owner STX 1A FS Product tanker x 2 51,000 dwt March to May 2009

Target Marine STX 1A FS Panamax tanker x 3 72,200 dwt April to October 2007

Teekay Shipping DSME 1A FS Aframax tanker 114,834 dwt November 2005

Tsakos Shipping & Trading S.A. HHI 1A FS Suezmax tanker x 4 150,000 dwt April 2005 to February 2006

Ships which are tailoredfor ice and cold operationdiffer significantly inseveral respects from ships specified for normal trades.

HORIZONS June 200610

THE MODEL OF A MODERN SHIPPING COMPANY

“The examples we looked atwere in the finance industry,where you see a lot of mergerand acquisition activity,” saysSohmen-Pao. “We went througha rigorous process, not only tocome up with a name and logo,but also to think of the valueswhich underpinned the twoorganisations and to try to findan identity that reflected thebest of both.”

Sohmen-Pao believes that thistype of corporate branding isnow beginning to permeate theshipping industry in a moremeaningful way than in the past.Such a move is hardly surprisingat a time when investor interestin public offerings from theshipping industry is at an all-timehigh. An emphasis on corevalues, increased transparencyand forward-thinking attitudesto concepts such as branding,which had previously been thepreserve of the consumerproducts industry, are allhallmarks of the modernshipowning and operatingcompany.

“The industry is starting tochange now. The fact that peoplehaven’t spent a lot of time onbranding is a reflection of thefact that we’re not a consumerindustry,” says Sohmen-Pao. “Thequality of the service, the peopleand the philosophy of theorganisation have been givenmore emphasis than externalappearances. But this is changing,and I think particularly as theindustry tries to project itselfbetter to a broader group ofstakeholders, these are seen asgoing more hand in hand.”

Measuring performanceNot only is the public becomingmore demanding of the shippingindustry, but so are its customers.A relatively recent example of acharterer-led initiative is theTanker Management and SelfAssessment (TMSA) guideintroduced by the Oil Companies’International Marine Forum(OCIMF), which requires tankeroperators to demonstrate theeffectiveness of their managementsystems according to criteria laidout in the guide.

BW Shipping Managers proudlystates on its web site(www.bwshipping.com) that, by theend of 2005, it had put in place theprocesses to achieve level 4 (thehighest level) for all the operationalelements specified by the TMSAguide. But far from beingmotivated by TMSA to put a systemof operational metrics in place toassess continuous improvement,BW Shipping began to undertakethis work as far back as 2001.

“Some people say that customersshould set the bar, but I think it’salways very dangerous when onestops taking responsibility for one’sown product or service or industry.We as shipping companies need towork individually and collectivelyto ensure that standards are kepthigh,” says Sohmen-Pao.

“We started working on ourmanagement system at a veryearly stage, based on a dialoguewith the major oil companiesabout an objective system ofmeasurement that would look atoperational performance, and it’ssomething we’ve been advocatingfor a long time.”

The newly re-branded BW

Shipping represents the

best of what the shipping

industry hopes to become,

by building on tradition

and applying modern

thinking about branding,

transparency and

customer service.

BW Shipping – the recently re-branded entity that used to beWorld-Wide Shipping – represents anew breed of shipping companywhich effectively marries East andWest, traditional family values andmodern management principles. To reflect a new, unified identityfollowing its acquisition of Bergesenin 2003, the company has beenrestructured into four areas – BWGas, BW Offshore, BW Tankers andBW Dry Bulk – and adopted a new,modern logo and a striking newlivery for all of the ships in its fleet.

According to Andreas Sohmen-Pao, Managing Director of BWShipping Managers Pte Ltd, aconscious decision was made earlyon to keep the World-Wide andBergesen brands separate, at leastinitially, and to retain a largedegree of operationalindependence. But there wasalways a possibility that the twowould eventually be broughttogether when the time was right.

Andreas Sohmen-Pao

For further informationcontact David Tozer,Business Manager –Container Ships, Lloyd’sRegister

E: david.tozer@lr.orgT: +44 (0)20 7423 1562F: +44 (0)20 7423 2213

June 2006 HORIZONS 11

BW Shipping wanted a system thatwould go beyond checking thephysical assets and take intoaccount its people and theoperations behind the ship.

“We set up an internal ratingsystem that focused on the ship,but also took into account otherimportant factors such as the levelof reporting for near misses andthe level of safety awareness. Welooked at a whole host of measuresand came up with a ranking systemfor our entire fleet, based onobjective, measurable criteria.”

Sohmen-Pao is far fromcomplacent, though, and makes itclear that he believes that systemssuch as TMSA and ISO 14000 arecontinuous processes and placesgreat emphasis on the “degree ofaspiration” that he sees as integralto these standards.

“When we say that we have putsystems in place to achieve level 4,we are not saying ‘we’re done’. Wehave to constantly improve oursystems to keep up with thehighest level we can. I guess theway I’d prefer to word it is that weaspire to maintain the highestTMSA level.”

Service and growthSohmen-Pao’s aspirations alsoextend to the commercial growthof the organisation as a wholeand to reaching new standards ofcustomer service.

“We’re looking at fleet renewalacross all the sectors that we’reinvolved in,” he says. “It’sdifficult to do that at a timewhen prices are at a historicalhigh. But we are findingopportunities now and againwhere we can acquire or take onassets at a reasonable cost.”

Recent examples includecontracting for two new VLCCs atBohai Shipyard in China, to bebuilt to the Common StructuralRules for tankers, and a series ofeight LR1 product tankers to bedelivered from Dalian ShipbuildingIndustry Co Ltd (DSIC), which wereoriginally contracted by IMCShipping and sold to AL Ships ofGermany in 2005. The first of thecoated panamaxes is to bedelivered in July 2006. Four of theships will be on a five-year timecharter to Torm and the remainingfour will operate on the spotmarket within Torm’s producttanker pool. According to Sohmen-Pao, the deal was largely

motivated by strongencouragement fromcustomers whowanted to seerenewed participationfrom BW Shipping inthe segment.

“It was both whatwe deemed to be areasonable dealstructure and aservice we hope willbe of use to ourcustomers,” saysSohmen-Pao.

“We see it as an interestingsector going forward because ofthe mismatch between where therefineries are being built andwhere the oil products are goingto be needed. We see moredemand in the future of long-haul products transportation.”

On the gas side, BW Gas hasbeen time-chartering in anumber of vessels with purchaseoptions and taking delivery ofnew vessels for the Nigeria LNGproject. BW Gas also recentlyannounced a strategicpartnership with Maran Gas, andthe acquisition of the Yara LPGfleet, further strengthening thecompany's status as the leadingLPG operator and one which canprovide a flexible service tocustomers. BW Gas’ current statusas the world’s leadingindependent LPG operatorprobably best reflects Sohmen-Pao’s aspirations for customerservice across all the companies inthe BW Group.

“The ideal situation is where thepartnership enables the supplier toprovide something special, and oneexample is by providing a contract-of-affreightment service whichenables the customer to maximisehis access to tonnage when andwhere he wants it. This issomething that we‘ve achieved onthe LPG side, because of the criticalmass that BW Gas has,” he says.

“In an industry context, furtherconsolidation in the industry whichallows very large customers like theoil companies to work withsuppliers that are of sufficient sizeand standing would be beneficialto both parties. The objective is notto influence pricing, which ispractically impossible in a shippingcontext, but to create a largeenough unit to be a solidcounterpart for the oil companies.”

For further information

contact Bernard Stringer,

Senior Strategist, BW

Shipping Managers Pte Ltd

E bernard.stringer@

bwshipping.com

T +65 6337 2133

F +65 6337 1623

“The ideal situation

is where the

partnership enables

the supplier to

provide something

special.”

IHORIZONS June 200612

Lloyd’s Register EMEAT + 44 (0)20 7709 9166F + 44 (0)20 7423 2057E emea@lr.org

71 Fenchurch StreetLondon EC3M 4BS, UK

Lloyd’s Register AsiaT + 852 2287 9333F + 852 2526 2921E asia@lr.org

Suite 3501 China Merchants TowerShun Tak Centre 168–200 Connaught Road CentralHong Kong, SAR of PRC

Lloyd’s Register Americas, Inc.T +1 (1)281 675 3100F +1 (1)281 675 3139E americas@lr.org

1401 Enclave Parkway, Suite 200Houston, Texas, 77077, USA

www.lr.org

June 2006

Services are provided by members of the Lloyd’s Register Group. Lloyd’s Register, Lloyd’s Register EMEA and Lloyd’s Register Asia are exempt charities under the UK Charities Act 1993.

ON THE HORIZON

Exhibitions and technical papersOver the next three months (June 2006 to August

2006 inclusive) we will be sponsoring and/or

exhibiting at:

Posidonia Cup Race/Reception, Piraeus, Greece, June 2

Posidonia, Piraeus, Greece, June 5-9

We will be presenting papers at:

Environmental Law and Regulation in the Shipping

Industry, London, UK, June 19-20, Nick Brown

Tribology at Sea, Southampton, UK, June 28, Danny

Shorten

Noise and Vibration Conference, London, UK, June 28-

29, John Carlton

ICETECH 2006: International Conference and Exhibition

on Performance of Ships and Structures in Ice, Banff,

Canada, July 16-19, Rob Bridges, Kaj Riska

Engine and Machinery Failure Seminar, London, UK, July

17-18, John Carlton and Peter Filcek

We will be sponsoring:

Greenwich Forum: Civil Order at Sea in the 21st Century,

London, UK, June 22-23

• International LabourOrganization's Maritime LabourConvention adopted byInternational Labour Conference

• First SOx Emission Control Area(SECA) becomes effective May 19, 2006

• Indian Ocean MOU announcesnew concentrated inspectioncampaign on lifeboats andlifeboat-launching appliances

• California introduces newballast water managementregulations

• Washington introducesadditional ballast waterreporting requirement

• Product safety notice – fireextinguishers manufactured by Strike First

• Possible malfunction of KiddeGraviner MK6 engine crankcaseoil mist detectors.

Classification News is availablefree of charge. These issues,together with the archive ofalerts, may be viewed online atwww.cdlive.lr.org

Classification newsLloyd’s Register’s Classification News delivers up-to-date informationon issues requiring urgent and immediate dissemination to themarine industry. Recent inspection and statutory alerts we haveissued include:

HORIZONSFor further information on ourmarine services, please contactCarol Deane: T +44 (0)20 7423 2765F +44 (0)20 7423 4796E marine@lr.org

Managing Editor: Dolly RobinsonMarine Media ManagerMarine Business DevelopmentT +44 (0)20 7423 1682E dolly.robinson@lr.org

Horizons is produced by Marine Business Development and designed byPipeline Design.Care is taken to ensure that the information in Horizons is accurate and up-to-date. However, Lloyd’s Register accepts no responsibility forinaccuracies in, or changes to such information.