Ship Recycling – Multiple Hits Vol. II

Common sense. Two simple words that can radically change a way of thinking. Something that hits your door more than once deserves your attention. Within less than a year, ship recycling continuously requests to be praised like it should.

First, the facts, as noted in previous article (https://www.linkedin.com/pulse/denmark-ratifies-hong-kong-ship-recycling-convention-what-magoulas)

Countries having ratified HKC

  • Norway
  • Congo
  • France
  • Belgium
  • Panama
  • Turkey
  • Denmark

States having ratified Status: 7/15

World Merchant Fleet Representation: 24.98/40%

States having ratified Shipping Tonnage: 258.91

These facts also hide some more aspects. Among the states having ratified HKC, one can find three EU-approved ship recyclers (France, Belgium, Denmark), one major recycler (Turkey), the most busy flag worldwide (Panama), an important host of oil rigs and platforms, with strict and precise environmental protection legislative frame (Norway) and the host of the most disapproved ship owner by NGOs aka MAERSK (Denmark).

Now, let me share some more thoughts, mine and of other esteemed colleagues.

Initially, ClassNK teamed up with Green Award Foundation to enhance socially responsible thinking. Inevitably, green ship recycling could not be left apart. As stated, in a very good article (http://worldmaritimenews.com/archives/224190/classnk-green-award-strengthen-ties-to-enhance-socially-responsible-shipping/?uid=87688), “…ship recycling is one of the major issues that cannot be omitted and needs urgent attention. ClassNK has been addressing this issue in numerous ways including carrying out inspections on compliance with the Hong Kong Convention (HKC). ClassNK issued the world first HKC statement of compliance for ship recycling facilities in 2012 and the South Asia first statement in 2015. Its verification has provided the industry with “the transparent and reliable” criteria for safe and environmentally sound ship recycling. Moreover, ClassNK offers a software solution for the development and maintenance of the inventory of hazardous materials (IHM), which is one of the regulatory requirements for ships. The software has been used by 3,000 companies in shipping, shipbuilding, and manufacturing sectors…”. Additionally, Mr Tetsuya Kinoshita, ClassNK Senior Executive Vice President and the Member of Board of Experts, the Green Award Foundation, said that “…As the IHM contains ship specific locations and quantities of hazardous substances on board, a ship recycling facility can utilize the information for its safe and environmentally sound recycling practices. Recognizing the IHM is a key element for better ship recycling. ClassNK is glad to team up with the Green Award Foundation to launch this collaborative initiative promoting IHM development. Together with the Green Award and the industry we will continue working for a safer and greener future…”.

In addition, ship recycling is indicated as a “road to recovery (R2R)”. In another article of WMN (http://worldmaritimenews.com/archives/224186/demolition-time-to-take-the-bitter-pill/), BIMCO’s Chief Analyst Peter Sand noted that low freight rates should be the best incentive for owners to take the bitter pill and scrap some of the outdated tonnage in order to bring the necessary ease to the heavily oversupplied market. Mr Sand stated: “Get rid of the ships that are no longer economically viable, few as they may be, and avoid getting back to the shipyards any time soon. It would be a mistake to believe that this is the silver lining that will save the industry prompting large scale of demolition, and we do not expect huge buildup of demolition on the back of the Ballast Water Convention or the 2020 Global Sulphur Cap.” meaning that the possible effect of the upcoming entrance into force of the Ballast Water Management Convention (BWMC) and the 2020 Global Sulphur Cap and the claim that a lot of ships may be demolished amid high retrofitting costs to make them compliant with the new regulations is basically “wishful thinking”.

To the enhancement of these wise words, Mr Theodore E. Veniamis, President of the Union of Greek Shipowners, noted that firm scrapping activity stood a very supportive enhancement to the recovery of Greek shipping (aka one of the leaders in global shipping), during the first months of 2017. That is something very interesting to hear from a mouth that, in any case, speaks a mind deep into big shipping business.

Moreover, European institutions have called on the EU to address decommissioning of floating oil and gas structures as these fall under the same rules as commercial ships, and would therefore have to follow the EU Ship Recycling Regulation. More specifically, European Economic and Social Committee (EESC) and three Green Members of the European Parliament have highlighted the paradox between the strict rules under OSPAR for the decommissioning of fixed oil platforms from the North Sea with the rules that govern the recycling of floating platforms and structures. To give you a hint, remember Transocean Winner. To give you one more hint, O&G structures are not laid only in North Sea and Med Sea can boast a significant share within Greek territorial waters.

Finally, according to Clarksons Research, “…it seems unlikely that we have reached the bottom of the current cycle, and pressure to remove capacity remains. Shipbuilders will be hoping that new-build demand drivers come through quickly to stem the duration of this particular downturn…”. Could you imagine a better driver than the opening of the market due to older ships being led for recycling?

That’s why we are talking about multiple hits on our doors. Common sense is the best way to move around. And common sense dictates that repeating symptoms describe a state.

Ship recycling is making his presence impossible not to perceive. In order to avoid over-concentrating demand, it would be wise to take responsibility and go ahead with the launching of upcoming requirements.

P.S.: In cover photo, it is a frame from COSTA CONCORDIA dismantling, in Genoa port, dockside.

Genoa might not be an EU approved facility but dockside recycling might be a very good way to allow green ship recycling in a more flexible manner, as VEOLIA implicated, during French Helicopter carrier Jeanne D’ Arc dismantling, at Bordeaux facilities (https://www.youtube.com/watch?v=GGLeFjOnbjc).

If a warship – which is a very demanding case of ship recycling – can be dismantled dockwise, we should give serious thought to further application of the method, always in compliance with EU SRR and HK SR Convention.

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