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Dubai Ports World rakes in the cash

DP World saw post-tax profits more than double in the first half of 2008 to US$287m. The result came on the back of a 32% rise in turnover to US$1.6bn and a 21.6% rise in throughput to 13.6m teu. The operator added two terminals, at Dakar and Sokhna, to its 44-port portfolio during the six month period, with Tarragona handed over in July and concessions at Aden and Ma'alla in Yemen expected to follow later in the year.

DP World chairman Sultan Ahmed Bin Sulayem said: "DP World has performed extremely well in the first half of this year. Building on its outstanding performance in 2007, the company recorded a profit after tax for continuing operations of $287 million; more than double that of the same period last year and particularly pleasing given the more challenging operating environment in the first half of this year."

"DP World remains committed to expanding its already strong presence in the faster growing emerging economies together with the more mature economies where capacity is constrained. Its particular focus on the East-West trade routes via the Suez Canal and on origin and destination cargo positions it perfectly to capture the long term growth potential evident in these regions. Despite the current uncertainty surrounding short term global growth, we will continue to invest for the longer term."

CEO Mohammed Sharaf added: "We are delighted with the performance of our terminals during the first half of 2008. These results are particularly pleasing in light of the fact that the industry overall has seen a slow down in volume growth in the Asia-Pacific region, and we are operating in a more challenging global financial and economic environment. Despite this, DP World has delivered a substantial increase in volume, revenue, EBITDA and margins."

"The business has performed very well in the first half of 2008 despite a deteriorating global financial and economic background and these uncertainties remain. In the last few months the industry has reported early indications of weakening growth in some markets, but thus far into the second half, our business has continued to perform ahead of the market and report growth over the comparable period last year. We expect this trend of outperforming the industry to continue through 2008, and anticipate delivering full year results in line with expectations."

BHP Billiton and the Western Australian government have agreed final plans to expand the port of Hedland which will see the ore port's inner harbour capacity increase more than double to 420m tonnes per annum. The originally approved plan was to increase capacity to 315mtpa. The port authority and the company are also examining options for expanding the outer harbour as well.

Shanghai's Sealink Shipping has ordered a capesize bulk carrier from South Korea's Hanjin Heavy Industries. Due for delivery in 2011, the vessel is worth Won108bn. The deal marks Sealink's first foray into bulk shipping.

Japan's 'K' Line is launching a feeder service between the US East Coast and Brazil's Amazon region from October. The service will be jointly operated with US partner Bringer Lines and will be served by two 500 teu vessels on bi-weekly basis. The service will run between Savannah, Port Everglades, Manaus and Vila do Conde.

China Shipping Container Lines has seen its first half profits slide to Yuan637.2m, down 44% on the previous year, despite revenue rising just over 5% to Yuan18.4bn. The company said that a fall in demand on the US and European trades had caused the fall in profit, with transpacific revenues down 17% and volume down 12%. Despite that, overall volume was up 7.3% to 3.57m teu, although costs were also higher. While volume on European routes dropped slightly, revenue rose 11% to Yuan6bn, and the company's Asia Pacific and China services all saw a sharp rise in both volume and earnings.

Belgian bulk carrier group CMB has seen its first half turnover soar from Eur179.5m to Eur239.5m, but its post-tax profits fall slightly to Eur136.7m on the back of a Eur14m rise in exchange rate losses and other financial items. The company's primary arm, bulk carrier operator Bocimar, saw its net profits drop Eur7m to Eur140.1m in the first six months of the year.

Norway's offshore specialist Deep Sea Supply has seen a much improved six months, with revenues up 58% on last year to US$85.6m and profits of US$31.4m, up from US$24.6m for the first half of 2007. The second quarter was better than the first, with profits soaring from US$11.3m to US$19.9m while revenues remained stable at US$43.1m. The company said its rise in profits was mainly due to good performance from its platform supply fleet.

Frontline subsidiary Independent Tankers has reported net income of US$7.2m from its first six months of operation, with second quarter net income of US$3.5m. The long term bareboat charter specialist, which owns or leases six VLCCs and four suezmaxes, was incoporated in January of this year. The average daily bareboat rate earned in the second quarter by the company's VLCCs and the Suezmax tanker Front Voyager were approximately US$26,100 and US$7,900 respectively, compared with US$26,100 and US$8,000, respectively in the preceding quarter.

The US Naval Central Command has ordered Coalition naval forces to establish a 'Maritime Security Patrol Area' in the Gulf of Aden to protect merchant shipping. Navy warships will patrol the area with aircraft support, under the command of Commodore Bob Davidson of the Canadian Navy.

The move comes following last week's spate of hijackings by Somali pirates. Seven vessels and around 130 crew are currently being held, four of which were seized in the past week in a massive escalation of what, in previous years, have largely been relatively small-scale pirate operations. The maritime industry has long called for an improvement of security in the shipping lanes around the Horn of Africa, as without any central authority in Somalia pirates are free to act at will.

The UCSNC statement said: "The MSPA is being established in support of the International Maritime Organization’s (IMO) ongoing efforts. Coalition actions will give the IMO time to work international preventative efforts that will ultimately lead to a long-term solution."

"Coalition ships are in the area as part of our continual presence in this region. While they have conducted routine operations in the area in the past, the establishment of the MSPA will focus the efforts to counter destabilizing activities in the region and improve security while long-term initiatives mature."

The Frontline shipping group's Seatankers Management has cancelled an order for four chemical tankers from the Alcock Ashdown Gujarat shipyard in India. The first of the four 12,800 dwt ships had been due for delivery in october last year but remains incomplete, and has now been rescheduled for December 2009, with the other three to follow at three month intervals. The company has not given a reason for the contract's cancellation. The shipyard is now attempting to find a buyer for the four vessels.

China State Shipbuilding Co has seen an 81% rise in first half net profits to Yuan1.95bn on the back of strong demand for parts and maintenance services and last year's acquisition of Waigaoqiao Shipbuilding. Sales were strong, with revenue up 40% to Yuan7.7bn, although profit margins in shipbuilding dropped to 19.42% from 26.44% due to material costs and a fall in value of the US dollar.

Offshore operator Polarcus has ordered six new ships designed by Norway's Ulstein group, to be built at Drydocks World Dubai. design. "Polarcus is building up a fleet of the most modern and sophisticated seismic vessels in the world. We are, of course, pleased that they want the 'Ulstein X-Bow' on their six new vessels. It is a vote of confidence when our customers come back to order new vessels with an Ulstein design," said Ulstein Group CEO Gunvor Ulstein.

"Norway has a complete and expert environment in the seismic and offshore vessels segment. We believe in the 'Ulstein X-Bow' concept, especially when it comes to the environment. We also want the ship’s crew to have good and safe working conditions, and we believe this design helps meet such requirements," Polarcus EVP Peter Zickerman added.

The new designs hold DNV ice classification. "The entire ship is fortified with thicker frames and skin plates to withstand the onslaught of ice. There are de-icing and ice-preventing systems on critical tanks and pipes. Escape routes and rescue equipment are also secured against icing during Arctic operations. Propellers, gears and thrusters are chosen and dimensioned according to special rules for enduring harsh Arctic conditions," said Ulstein Design managing director Rolf Inge Roth.

The first two ships will be delivered in third and fourth quarters of 2009, respectively, and the last two in the first quarter of 2010.

THE piracy situation in the Gulf of Aden is “out of control” according to ICC International Maritime Bureau Pottengal Mukundan. He was responding to the “unprecedented” hijacking of four large merchant ships within the space of 48 hours.

"Another ship, a German vessel, was taken late on Thursday," said Noel Choong, head of the bureau's piracy reporting centre in Kuala Lumpur. This brings to eight the number of merchant ships now being held by Somali pirates.

Capt Mukundan added: “We have not seen such a surge in pirate activity in this area previously. These pirates are not afraid to use significant firepower in attempts to bring vessels under their control. Over 260 seafarers have been taken hostage in Somalia this year. Unless further action is taken, seafarers remain in serious danger whilst navigating the Gulf of Aden.”

He said that the the latest spate of hijackings appeared to show that the recent UN Security Council Resolution 1816 (2008) that allows states cooperating with Somalia to enter its territorial waters in order to repress acts of piracy and armed robbery “by all necessary means” is “clearly not working”. He did stress though that Coalition warships have intervened and helped prevent a number of attacks.

In all reported instances, vessels have been approached by speedboats containing men armed with machine guns and rocket-propelled grenade (RPG) launchers. In their attempts to slow down and board the vessels, the pirates have opened fire against the unarmed merchant ships.

It now appears that there was a “casualty” when the Malaysia-flag palm oil tanker Bunga Melati Dua was hijacked. It owner, MISC, issued the following statement earlier today: “First communication with Bunga Melati Dua was established at 1705 hours (local time) / 0905 GMT on 21 August 2008. MISC was informed that there has been a casualty onboard involving one of our Filipino crew members during the boarding of the vessel by the hijackers. We are unable to confirm this incident. We are informed that the remaining crew members are safe.”

SPECIALIST offshore shipowner and manager GC Rieber Shipping made a Q2 net profit of Nkr45.0m (US$8.4m) net compared with Nkr178.9m. The company says that in Q2 2007, NKr133.2m of the profit was related to a reduction in ownership in Arrow Seismic, which no longer was consolidated as a subsidiary in the financial accounts. It adds: “ The net profit in Q2 2008 is in line with expectations, despite negative effects from currency development. The net profit for the first half of 2008 was NKr75.2m, compared with NKr196.8m in the first half of 2007. The profit in the first half of 2008 is affected by currency development, as well as bad weather conditions in the North Sea in Q1 2008.” CEO Sven Rong says: “We have during the second quarter continued our positioning for new initiatives within the offshore market and we have established an organisation in Asia,. In May, the company invested in four new specialized offshore vessels and acquired a 40% shareholding in the Singapore based company Bluestone Offshore. This adds to the acquisition of subsea specialist Scan Mudring in March. - The operation in Asia is strategically important for us, partly because Asia is an attractive market, but also because the operation in the long term enables us to become more cost effective.”

THE London P&I Club has warned that bins and flat- racks used to stow container twistlocks on board vessels are occasionally found to be in an unsafe condition because of corrosion or physical damage. It says that the structural failure of this equipment as it is lifted could create a severe personal injury risk.

In the latest issue of its StopLoss Bulletin, the Club notes, “Standard container operation in many terminals involves the ship’s semi- or fully automatic twistlocks being fitted to or removed from containers by stevedores on the quayside. These twistlocks are often stored in steel ‘gear bins’ which are themselves stowed on flat racks that are lifted off and on the ship by shore cranes.”

It notes: “The flat racks are landed ashore just before discharge commences and the bins are filled with the twistlocks removed from the containers as they are discharged. As containers are loaded, twistlocks are then removed from the bins and fitted into those containers. On completion of cargo work, the bins, which will contain any unused twistlocks, are placed back on the flat racks and then lifted on board, where they are routinely stowed on top of stacks in positions that are inaccessible to the crew.”

“In one recent incident,” the club says, “a port safety officer allowed flat racks to be returned onboard only on condition that the bins were first emptied of twistlocks. In some cases it is thought the equipment falls outside the inspection regimes of flag state, class or port state control and, due to its often remote stowage position, an ‘Out of Sight Out of Mind’ philosophy can develop on board. Accordingly, owners should ensure that the equipment is incorporated into a planned maintenance system and, if necessary, be the subject of regular third-party inspections.”

MAJOR integrated physical bunker supplier Chemoil has acquired a controlling interest in a storage terminal in the Philippines. The ocean-front terminal located in Batangas, Philippines has an operational capacity of 34,000 cubic meters that could be used for the storage of petroleum products such as gasoline, diesel and fuel oil.

The Singapore Stock Exchange-listed company says: “The investment is valued at over US$13 million and was financed through a combination of debt and equity. “

The terminal is located on 23 hectares of freehold land thereby providing opportunity for further expansion. The company is currently exploring the possibility of expanding the terminal in the near future so that additional storage capacity may be used for marine fuels supply. In the interim, Chemoil will make further investments to the facilities to better meet the storage terminal’s operational requirements.

Chemoil Chairman and CEO Mike Bandy says: “This acquisition is consistent with the company’s core strategy of growing our business along the lines of expanding geographic coverage of our operations, continuing to backward integrate our logistics chain, and offering new products whenever possible. We have a track-record of developing our business through identifying strong growth opportunities and so our investment in Batangas is a logical step. We have our Asia headquarters and a flourishing marine fuels business in Singapore and this newly acquired storage terminal will help us extend our presence into key regional markets in and around the Philippines.”

SOMALI pirates have seized three large merchant ships in the Gulf Aden in three days, two within two hours in the early hours of this morning. The MISC-owned, Malaysian-flag chemical tanker Bunga Melati Dua was seized on Tuesday. Early this report reached the International Maritime Bureau's (IMB's) Piracy Centre in Kuala Lumpur that two more ships, a Japanese-controlled tanker and an Iranian vessel were boarded, in one case at least after a large amount of gunfire.

These latest incident bring to six the number of ships held in Somali waters. Negotiations are underway in at least two the earlier cases, including the bulker Stella Maris, also Japanes-controlled, with a view tose curing their release.

Noel Choong who runs the IMB's Kuala Lumpur operation said that the UN had to act against the pirates. He said the recent UN Security Council resolution allowing warships to undertake hot pursuit of pirates in Somali territorial waters was not providing sufficient deterrent to stop the prirates. He said he was worried the situation could escalate further as more armed groups in Somalia, where the central Transitional government has almost no effective control of most of the country realised they could make big money from hijacking ships.

Meanwhile MISC has issued a statement today on the Bunga Melati Dua:” There has been no contact with the crew or hijackers of Bunga Melati Dua so far. The ship was last sighted heading towards Somalia and MISC is working closely with the relevant authorities in monitoring the situation.”

The Malaysian shipping company adds: “We would like to reassure all concerned that the safety and lives of our crew members are of utmost priority to us. We have contacted the Malaysian and Philippine family members of the affected crew and will provide all necessary assistance and support to them in this trying period. To protect and safeguard the safety of our people onboard, we will not be able to provide any detailed information at this point of time. Further updates will be provided as and when deemed necessary.”

A FORMER engineer on the US Coast Guard cutter Rush has been fined US5,00, ordered to serve 200 hours of community service and serve two years of probation for lying to federal criminal investigators about his knowledge of the direct overboard discharge of bilge wastes through the ship’s deep sink into the Honolulu Harbor.

According to a Department of Justice statement as the main propulsion assistant David Williams oversaw the maintenance of the main diesel engines and other machinery in the engine room for the Rush, a 378 ft. high-endurance cutter stationed in Honolulu. On 1 May Mr Williams pleaded guilty to making a false statement to federal law enforcement agents.

According to the plea agreement, on or about 8 March 2006, Williams had knowledge of the direct discharge of bilge wastes into Honolulu Harbor. The Engineering Department personnel aboard the Rush engaged in an unusual and abnormal operation and configuration of engine room equipment to pump bilge wastes from the aft bilge to the deep sink and overboard into Honolulu Harbor, thereby bypassing the “oily water separator” (OWS) system.

The Department of Justice says that , in mid-March 2006, the State of Hawaii Department of Health received an anonymous complaint stating that Rush crew members were ordered to pump approximately 2,000 gallons of bilge waste into Honolulu Harbor. The statement says: “On May 1, 2006, investigators from the U.S. Coast Guard Investigative Service (CGIS) received confirmation from Main Propulsion Division personnel who personally participated that bilge wastes had indeed been discharged through the deep sink and into Honolulu Harbor. CGIS investigators obtained various corroborative documents from the Rush, including engineering and ship’s logs, tank level sounding sheets, as well as the pneumatic pump used to facilitate the discharges.”

The Department of Justice statement makes no mention of any action being taken against the other US Coast Guard personnel involved in the illegal discharge nor of any action the the Coast Guard should take to prevent repetition of the offence.

DUBAI-based international port operator DP World has signed £400m (US$744m) contract to build the first phase of a new port at London Gateway, the most technically advanced container port in the world, integrated with Europe’s largest logistics park.

This is the first major contract to be awarded in the £1.5 billion project, due to be built over the next 10 to 15 years. The contract is over five years, and will see the construction of the first phase of the port’s quay providing three berths and over 1.2 kilometres of quay in a joint venture between Laing O’Rourke and Dredging International. The new port will eventually handle 3.5milion TEU (twenty foot equivalent units), providing a much needed increase in capacity for the UK’s container terminals.

The South Essex project is currently set to be the largest creator of new jobs in the UK, delivering over 12,000 in the coming years, and is the largest investment in the South East of England.

Chief Executive of London Gateway, Simon Moore, said: “This contract is a major milestone in constructing the port. In an economic climate where the building industry is experiencing a sharp slow down, this is great news for Essex and the UK in general. “London Gateway is vitally important for today’s UK economy. It will deliver the most efficient and technologically advanced port in the world and much needed deep sea capacity for the UK.”

London Gateway is the UK’s first deep sea container port for over 25 years and will change the way millions of consumer goods are transported around the country. By integrating the new container port with a logistics park, many everyday goods will be sent to the nation’s shops without having to be hauled on a truck to a distribution centre often situated inland hundreds of miles away from a container port. Instead, goods will go straight into London Gateway’s own logistics park to be sorted and then sent direct to shops.

THE shipping industry has welcomed the move by Japan to start eco-labelling food and other products.

A Chamber of Shipping statement says: “Such a move across the UK would help to de-bug the two “food miles” myths – that the distance a product is transported provides a guide to its carbon footprint and that imported food is commonly transported by air.”

The Chamber notes that Japan is to carry carbon footprint labels on food packaging and other products in an ambitious scheme to persuade companies and consumers to reduce their greenhouse gas emissions.

It asserts: “Almost all imported foods (and other goods) on supermarket shelves have been brought in by sea. Shipping carries 92% of British trade by volume. Transporting a product by sea produces about 1% of the carbon dioxide that would be produced by carrying the same item the same distance by air – so 100 “food miles” by ship is the equivalent in CO2 output of only one “food-mile” by air or 10 “food-miles” by road. Clearly to compare “food-miles” is completely ludicrous as a way of estimating a product’s impact on global-warming.”