HCB Magazine September 2021

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UP FRONT 01

EDITOR’S LETTER

Eighteen months have passed since the novel Coronavirus, generally known as Covid-19, first made its way out of China and into the mature markets of Europe and North America. It brought with it untold stresses, forced us to think differently about how we work, and caused an immense amount of misery and grief.

Many of us took some time to wonder how different life might be once we came out the other side of the global pandemic and emerged into what became thought of as the ‘new normal’. Indeed, that was a fundamental question posed at last year’s EPCA Annual Meeting. And as we prepare for another virtual EPCA event next month – did we expect restrictions to last this long? – I am beginning to think we are already living in this new normal world.

Even before the virus arrived, there had been talk for some time – again, not least at the EPCA Annual Meeting – of the increasing volatility, uncertainty, complexity and ambiguity (often condensed to the rather ugly acronym VUCA) being displayed in global supply chains. Well, if we though we were suffering from a bad case of VUCA in 2019, we hadn’t seen anything yet.

I have spent a large part of this year talking to executives across the supply chain – that’s my job, after all – and

stresses are apparent to everyone.

As the half year results have been rolling in over the past few weeks, many corporations active in the supply chain have done quite nicely out of this massive dose of VUCA. Many chemical distributors, several storage terminal operators and some shipping companies have reported significant increases in revenues and profit.

It has also been noticeable in some quarters that companies have decided that this is the time to grow: size confers some protection against volatility, as access to a larger pool of assets allows them to be deployed more flexibly. This seems to run counter to the assumption that agility is key at such times and that it is the smaller operators that are nimble enough to take advantage. The recent spate of moves to consolidate the chemical and LPG tanker sectors suggest that not all agree. The major chemical distributors, too, have been active in the M&A sector, expanding their reach into growing markets.

But to return to my earlier point: is this going to be the way of things for the foreseeable future? While vaccination programmes have taken the sharpest stings out of the pandemic, they have not cleared the way for a full return to the ‘old normal’. New variants have emerged and made

I hear the same story from all quarters. Suppliers are unable to provide raw materials on time; prices are rising all round; ocean freight costs have skyrocketed, even as reliability has plummeted; inventories have been built up and then drawn down, only to reappear somewhere else.

It doesn’t matter if you are a transport operator, shipper, receiver or a provider of equipment and services, the same

their way around the world, forcing shutdowns at ports here and there that have continued to create VUCA in the supply chains. Until we find a way to eliminate the virus altogether, it seems to me that this is going to be ‘normal’ from now on.

Peter Mackay

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UP FRONT 03

CONTENTS VOLUME 42

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NUMBER 08

UP FRONT Letter from the Editor 30 Years Ago Learning by Training Face the change Survey shows the need for action The road ahead Chemical Express imagines the future STORAGE TERMINALS Best in breed Stolthaven recognised in Brazil Adapt and thrive Vopak faces energy transition Eyes in the skies Oiltanking tests drones News bulletin – storage terminals TANKER SHIPPING Size is important Consolidation comes to chemships All to play for Stolt Tankers joins zero carbon plan Partners in green Proman expands methanol fleet A close shave

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Editor–in–Chief Peter Mackay, dgsa Email: peter.mackay@hcblive.com Tel: +44 (0) 7769 685 085

Odfjell tests hull cleaning idea Safety update OCIMF tweaks SIRE News bulletin – tanker shipping TANKS & LOGISTICS Fit for the future Perolo enjoys surge in orders See it through More acceptance for digital systems Electric key VTG adds security system Inflation situation STC considers market changes News bulletin – tanks and logistics CHEMICAL DISTRIBUTION Growth markets IMCD expands in China, Latin America Organic chemistry Brenntag’s strategy pays off The right mix Univar sees demand return Challenging times CBA counts cost of disruption News bulletin – chemical distribution

Campaigns Director Craig Vye Email: craig.vye@hcblive.com Tel: +44 (0) 208 371 4014

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COURSES & CONFERENCES Conference diary

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SAFETY Incident Log Heat treatment What went wrong with Stolt Groenland Wrecks removed Salvors busy yet again

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REGULATIONS Next steps Changes planned for RID/ADR/ADN Meet the standards Texas codifies storage tank safety Aussie rules Australia updates ADG BACK PAGE Not otherwise specified

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NEXT MONTH The Europe Issue EPCA Annual Meeting preview Shortsea shipping, warehousing, intermodal transport, storage terminals

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04

30 YEARS AGO A LOOK BACK AT SEPTEMBER 1991

The global economy was having a tough time of it thirty years ago, which was reflected on the cover of the September 1991 issue: “From top gear to neutral in one year”, we said about the tank container industry. That summarised our review of tank container manufacturing, a sector then still largely concentrated in Europe (with the notable exception of South Africa and the beginnings of an industry in the US), but one undergoing a sudden decline.

The problem was our old friend ‘supply and demand’. Interest from chemical producers had waned in the face of declining end user demand, resulting from the economic crises of the late 1980s and early 1990s; the market was already well supplied after a surge in tank manufacturing in 1989 and the first half of 1990. It had been hoped that the fall of the Communist bloc would have opened new markets but those countries were strapped for cash and sales were disappointing, with only WEW managing to make much headway.

Still, for those who follow the tank container market these days, it is interesting to see who the big players in the manufacturing business were back in 1991: South Africa’s Consani was leading the way, expecting to produce 800 tanks in 1991, followed closely

Elsewhere in the September 1991 issue, ‘HJK’ provided an extensive report from the Pira Update Seminar, the annual conference for the UK dangerous goods sector, now under the wing of the Vehicle Certification Agency (VCA) – and we hope to see it back in action next year. At the time, the value of the event was enhanced in no small part as Lance Grainger, senior principal in the dangerous goods sector at the UK Department of Transport, was also chair of the UN Committee of Experts on the Transport of Dangerous Goods.

Along the way, Lance noted that the UN Committee had adopted modifications for the test methods for Class 1 articles on the basis of proposals from the USSR and that these would appear in the revised Test Manual, “a document which had developed in piecemeal fashion and which was badly in need of revision”, a task the UK had rather rashly offered to take on.

Those readers who are involved in product classification and whose instrument of torture is the Manual of Tests & Criteria can here get a glimpse into its origins.

Lance also reported happily that, after four years of hard work,

by Universal Bulk Handling (UBH) in the UK, and the French duo of BSL Transport and Containeering (the latter’s designs also being produced by CITBA in France and Welfit Oddy in South Africa), with WEW in Germany and CPV in Ireland also well represented.

Their output figures, though, are now vastly exceeded by production capacity at the major Chinese firms that have dominated the market over the past decade or more.

the UN experts had agreed on new criteria for Class 2 gases and their separation into three divisions, as well as revisions to definitions and carriage provisions for Division 6.2 infectious substances, an area that has lately received more interest after experience in its application in the Ebola virus response and, still ongoing, dealing with the Covid-19 pandemic. The UK experts were, perhaps, ahead of the game on that one.

HCB MONTHLY | SEPTEMBER 2021

UP FRONT 05

LEARNING BY TRAINING

by Arend van Campen

THE UNCERTAINTY PRINCIPLE OF BUSINESS

Usually I travel to the marine storage terminals of our customers worldwide. Before the Corona outbreak I averaged about ten onlocation trainings per year. My current travel has been reduced to once or twice a year. As a matter of fact I just returned from Walvis Bay, Namibia where I updated two terminals by implementing the latest ISGOTT (sixth edition, 2020). It was not easy to organise on-site courses because of the unpredictability factor of politicised politicians who perhaps listen to their health advisors, but not to us, business people or entrepreneurs.

For example: I was invited to fly to Namibia, so I had to buy a ticket, apply for a visa, book a hotel, make an appointment to be PCR tested within 72 hours of departure. All this without any certainty that this assignment could be executed until the very last minute, only if I tested negative. This means that thousands of euros were spent without knowing that this money could be made back from this deal.

This uncertainty is highly distressing business potential and performance, because there are no guarantees to be able to go there and neither to be able to go home after the job is done. You are only allowed to fly if you are vaccinated, tested negative or prove you

proven by a flawed PCR test, so I can’t promise my client that I can be there when he needs me.

This uncertainty and dependence on politicians and those who benefit of their decisions is called collectivism, which is usually a predecessor for a totalitarian system. When you read the book The Great Reset by World Economic Forum founder Klaus Schwab, you’ll see that this reset is not designed as a positive interdependent social system (benefitting everyone) but as a negative interdependent system (benefiting a few, but at the costs of…..).

Although the book highlights numerous global risks such as climate change, biodiversity loss, ecological devastation, drinking water pollution and so on, they originated from the WEF Global Risks Reports, which I have been researching for the last decade. These environmental and human crises have not been mitigated prior to the Covid 19 outbreak, but were fundamentally caused by those who support the World Economic Forum.

Did the WEF suddenly, because of the Covid situation, grow a consciousness to create a better world? Ask yourself this question, based on research.

recovered from Covid 19.

Mathematics and physics talk about the Uncertainty Principle, which I’d like to use as a metaphor to describe our current business environment. Imagine you have a client who’d like to store oil in your tanks, but he won’t be able to confirm the availability of the oil until a government official approves it. Another example: my doctor checks my health regularly, but I can’t travel, because now my health must be

My company is not the only one that is struggling to stay afloat in a business atmosphere I can no longer understand.

This is the latest in a series of articles by Arend van Campen, founder of TankTerminalTraining. More information on the company’s activities can be found at www.tankterminaltraining.com. Those interested in responding personally can contact him directly at arendvc@tankterminaltraining.com.

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06

FACE THE CHANGE CONFIDENCE • THE ANNUAL LABELMASTER DG SURVEY HAS IDENTIFIED MANY OF THE SAME FAILINGS AS IN THE PAST. BUT THERE ARE WAYS OUT OF IT, IF DG PROS TAKE CONTROL REGULATORY COMPLIANCE IS the cornerstone of safety in the transport, storage and handling of dangerous goods.

To achieve the necessary level of compliance, regulations and enforcement activity need to be transparent, balanced and consistent; all those involved in the regulated activities need to be properly trained and competent to do their jobs; and, perhaps most importantly, business owners and managers need to be aware of the hazards their activities present to workers, the public and the wider environment and to be prepared and able to provide the tools needed to ensure that their goods move safely.

HCB MONTHLY | SEPTEMBER 2021

Unfortunately, as Labelmaster’s annual Global Dangerous Goods Confidence Outlook survey has found over the six years it has been conducted, there is a persistent lack of confidence among a significant slice of dangerous goods professionals that they have the tools, ability and support needed to achieve consistent compliance. The results of a lack of compliance are not just fines and penalties from the enforcement agencies, but also a regular disruption to supply chains as goods are held up or returned, with a consequent impact on customer service and, if such conditions persist, a negative corporate image.

This year’s Labelmaster survey, held again in collaboration with HCB and the International Air Transport Association (IATA) this past March/ April, showed that those trends are still in place.

The ‘three tribes’ identified in the 2020 survey – the best, the just good enough and the below-par – are still there too. And, as this year’s survey took place at the end of a year when supply chains were even more stressed than usual, as a result not only of the ongoing Covid-19 pandemic but also disruption in ocean freight and the longer-term impact of a shortage of drivers, it is illuminating to see that some of those questioned had managed to sail through it all, benefitting from the latest technology and the backing of their management.

HAPPY WITH PERFORMANCE When last year’s survey was carried out, in June 2020, three months into the pandemic, responders reported struggles with: • Receiving goods in a timely manner • A lack of carrier availability • Training and recertifying employees • Keeping up with the regulations.

UP FRONT 07

One year on and the picture is rather different: 80 per cent of this year’s respondents agreed that their companies coped well during the pandemic, with 62 per cent crediting their supply chain IT capabilities as playing a role in that performance. Indeed, 37 per cent said that their operations are already back to ‘normal’ and another 29 per cent anticipated getting back to pre-pandemic conditions within a year.

Despite that, among the 465 respondents to this year’s survey there were indications that there are still critical organisational issues that must be addressed if they are to be able to achieve compliance at a high level. Half of them pointed to inadequacies in organisation awareness of the role and its importance to the business and the lack of infrastructure with which they are provided. Nearly half were concerned about training, not least during the pandemic restrictions and the inability to conduct face-to-face training.

Other pain points are felt, as ever, in a lack of harmonisation between the various sets of regulations that must be applied, as well as their interpretation in different countries or even between different enforcement agents; the need for more investment in dedicated technology; and a lack of regulatory presence in the supply chain, which leaves the rulemaking bodies without the insights needed to develop the rules that will achieve the desired effect.

The need for greater support in terms of the provision of resources for dangerous goods compliance is well documented and something that has been flagged up over the past six years by the Labelmaster survey; nevertheless, most respondents to this year’s survey said that they are not expecting to see any growth in organisational support, with 75 per cent expecting the same – or even less – spending on dangerous goods management.

• Less than 20 per cent believe the existing technology at their disposal supports their company’s future dangerous goods needs • Just over 40 per cent feel that their current training and recertification curriculum is not equipped to meet future needs • More than 30 per cent feel their company’s senior leaders are unaware of the challenges they face in the dangerous goods supply chain • More than one-third indicated that their company only adheres to the minimum requirements.

These issues recur year after year and Labelmaster, HCB and IATA have been looking at the data to offer a way to improve the situation. So, while most organisations feel positive about how they have managed the pandemic (so far, at least), dangerous goods professionals need to do something to get attention.

Firstly, they need to change the conversation and engage the C-suite. Dangerous goods

WHERE CHANGE IS NEEDED Looking at the shortcomings that dangerous goods professionals are facing, • Only 25 per cent believe their company’s current infrastructure is equipped to meet their future needs

compliance needs to be seen not as a cost centre but as a value driver; make the effort to showcase the operational challenges, the costs of compliance versus non-compliance; and the opportunities for better-than-average compliance as a revenue generator and customer service tool.

“THERE ARE STILL CRITICAL ORGANISATION ISSUES THAT MUST BE ADDRESSED TO ACHIEVE COMPLIANCE”

Secondly, dangerous goods professionals should identify now how their training needs will have to evolve to meet future needs and to deliver the greatest value. Try and work out the cost per trained employee: how effective is it and how well do those employees retain the skills?

Finally, as supply chains become more complex, dangerous goods professionals have a responsibility to ensure that their organisation is operating safely and in compliance. Look at processes and data within the organisation and across the supply chain and adapt them, using technology if necessary, to delivery greater transparency and control.

Another area where dangerous goods professionals consistently appeal for help is for more harmonised regulation and interpretation, with only 23 per cent of this year’s respondents believing rules are well aligned across regions, industries and within their own organisation.

While the regulators always have their eye on harmonisation, their work too has been disrupted by the pandemic and, when it comes to the crunch, many national or regional regulatory bodies find their own good reasons to vary from the international model. That might be fine for those companies operating only within their national borders but the dangerous goods sector is increasingly international in scope and there remain many potential pitfalls for those shipping dangerous goods overseas, or importing from other territories. Individuals will find it difficult to put pressure on their regulators to take a more harmonised view and this is where representative trade bodies can play a part. It will also help when we can all get back to meeting in person and talk to regulators at industry events.

Labelmaster’s own annual DG Symposium, taking place online this month, is another casualty of the pandemic; it is to be hoped that we will all be able to get back to Chicago next year and try and thrash these issues out in person.

For more help with compliance issues, visit the Labelmaster website, www.labelmaster.com, and keep up to date with changes at www.hcblive.com.

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08

THE ROAD AHEAD OPINION • DIGITISATION IS AN INCREASINGLY IMPORTANT PART OF THE SUPPLY CHAIN BUT WHERE IS IT TAKING US? FRANCESO MATTOZZI OF CHEMICAL EXPRESS IMAGINES A NEW WORLD “LET’S TRY TO imagine how the world of transport could evolve,” begins Francesco Mattozzi, account manager at Italy-based intermodal specialist Chemical Express. While the chemical transport sector has made a start with the move towards ‘Industry 4.0’, there is a way to go and, he says, it will result in a very different business environment in the future.

When we get to that future, he says, clients for transport services, together with the logistics operators and those companies involved in the services ancillary to transport operations (railways, ships, terminals, ports, washing stations, etc) are all connected through an information exchange system based on blockchain technology.

If the offer is accepted, the carrier receives the order directly in his planning, verifying the availability of the requested vehicle in the right place and on the requested date, taking into account the type of product to be transported, the quantity, whether the product is classified as dangerous, and confirming the loading date or proposing an alternative date to the customer.

Customers request offers, by publishing transport tenders or by a single request, and the carrier’s artificial intelligence (AI), through an algorithm, calculates the rates, verifying in real time all the costs involved, like fuel, tolls, rail and sea freight, according to the requested transport mode.

computer system of other operators, such as railways and shipping companies, in order to have the availability of vehicles constantly updated.

In the event of a delay, a communication is automatically generated to the customer informing them of the new delivery date, with

HCB MONTHLY | SEPTEMBER 2021

FROM LOAD TO LOAD This AI algorithm constantly monitors all the planning for the next few weeks, continuously updating it on the basis of customer requests and assigning a vehicle for each order; obviously it is in constant contact with the

a simultaneous request for a new unloading/ loading slot at the unloading/loading plant.

In the meantime, the system records the delay by updating the statistics for the measurement of both its own KPIs and those of its customers and those of its suppliers, transmitting that information automatically.

When the system chooses the driver for the delivery, the order starts and gets displayed on the onboard computer on the vehicle. Through the satellite system, the algorithm checks the road, signalling any congestion to the driver and proposing an alternative route.

After carrying out the unloading, the AI connects to the cleaning station server, verifying the expected waiting time (calculated with the number of vehicles present and those booked). The algorithm estimates the washing times and the times to reach the next loading place. In the meantime, it checks that the cleaning certificate received from the cleaning station contains all the codes requested by the customer (the compatibility of the last product with the blacklist received by the customer has already been verified). The onboard computer, via Bluetooth, sends the order

 ALGORITHMS MAY REPLACE MANY FUNCTIONS CURRENTLY PERFORMED BY HUMANS BUT DRIVERS WILL STILL BE NEEDED AND THERE IS A HUMAN TOUCH TO CUSTOMER SERVICE THAT CANNOT BE REPLICATED

UP FRONT 09

data to the loading bay system. The tank gets loaded. The documents are posted, sent to the customer, together with an invoice that is automatically generated, by EDI data transfer.

Each week, through an app on the phone, the driver must answer a test to assess the degree of his or her ability to deal with dangerous situations and level of preparation on safety and other procedures. The driver’s assessment updates the staff database; therefore, the HR function is also carried out by the algorithm.

A new evaluation system for carriers, accessed by customers, based on ‘reputation’, which could integrate some existing evaluation systems, provides a complete picture of the performance of carriers, with periodic updating of the score.

WHAT ABOUT THE WORKERS? In terms of personnel, this imaginary scenario only involves the use of drivers, who seem likely to still be necessary, even if they are relegated to a very marginal role akin to that of a robot. All the office staff, from planning to

commercial functions, from the quality manager to the administrative office, will all be replaced by the algorithm.

Is this fantasy? Not exactly. Some of those systems needed to bring this future about are already in existence and are being used.

The IT systems of customers and suppliers are increasingly connected; they are already working on different web portals with various features, downloading orders, entering the personal data of the drivers and vehicles, up to confirming the shipment, sending the documents and costs. There are many web portals, and each customer chooses the one they prefer; it would be easier to create a centralised database and the problem would be solved.

The onboard computer and satellite tracking systems have been present on vehicles for several years; it is easy to imagine that in this future, directly connected with the company information system, the system could suggest alternative routes to avoid traffic jams or accidents.

To imagine that the human element, until now necessary in all companies, can be replaced by an algorithm that can simultaneously perform all the functions done by planning, commercial, quality, administration and invoicing, makes us imagine a dark future full of uncertainty for humanity. But fortunately, this is just one hypothetical scenario, although it has already been considered in detail by Yuval Noah Harari in his book 21 Lessons from the 21st Century; one of the book’s topics is the possibility that many jobs that are currently done by humans could in future be done by AI and there could be millions more unemployed around the world.

At the moment Chemical Express believes that the human element is still essential to be able to offer its services to customers.

At the same time, however, it looks with great interest at the technological innovations that are coming to the world of logistics, and continuously invests in the digitisation process of its fleet. www.chemicalexpress.it

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10 STORAGE TERMINALS

individuals. This prize recognises the efforts of all our people to deliver the highest standards of safety and care when handling our customers’ products. During the pandemic the team has demonstrated both resilience and commitment which has now been acknowledged by one of our most important customers.”

STOLTHAVEN SANTOS HAS been named the best liquids bulk storage terminal in Brazil in the Safety & Productivity category by Raízen, an integrated energy company and leader in biofuels. The award recognises the best management performance in the areas of safety, processes, productivity and controls out of a total of 22 terminals in the country.

“Stolthaven Santos stands out for the consistency of its management in the areas of safety, productivity and quality, being a benchmark for our ethanol operations over

Brazil’s main export hub for pharmaceutical grade ethanol and has provided high levels of accuracy and quality, with an operational loss below 0.1 per cent and exemplary non-contamination records.

Guy Bessant, president of Stolthaven Terminals, says: “This award marks another step on our journey to becoming the world’s most respected global storage provider. We are only able to achieve our aims thanks to our outstanding people across all functions working as a team, not only in Santos,

AROUND THE WORLD In the global perspective, Stolthaven Terminals reported operating revenue of $118.6m for the six months to end May, slightly below last year’s figure of $121.4m; operating profit also slipped, falling from $38.1m last year to $34.0m. The decrease in operating profit was mainly due to lower utilisation rates and throughput as well as higher maintenance, insurance and depreciation. This was partially offset by higher equity income from joint ventures.

“At Stolthaven Terminals we saw an increase in utilisation and throughput volumes, but pockets of weakness in Asia Pacific and Australia held the overall results down,” says Niels G Stolt-Nielsen, CEO of parent company Stolt-Nielsen Ltd. “Utilisation has continued to improve steadily over recent months, with an expectation that rates will follow.”

While early 2020 saw a massive fall in the price of oil and Stolthaven benefitted from the sudden need for more storage for petroleum products, its main activities are in chemicals and, increasingly, biofuels. As such, Bessant believes, it is well placed to cope with the changes coming as a result of government mandates around the world for a move away from carbon-based fuels.

Over the past two years Stolthaven has sold its Altona and Bundaberg terminals in Australia and consolidated its business in New Zealand with the decommissioning of the Wynyard terminal and the transfer of most of its chemical business to the Mount Manganui

the years,” says Nilton Gabardo, director of business development at Raízen. Santos is

but around the globe. In recent years, we have increased our focus on improving the customer experience and this is beginning to reap tangible rewards.”

Marcelo Schmitt, general manager of Stolthaven Santos, adds: “I am extremely proud to be leading a team of such dedicated

site, which has been expanded and upgraded.

Stolthaven, part of Stolt-Nielsen Ltd, now has 15 bulk liquids terminals around the world, of which 11 are wholly owned, offering a combined storage capacity of some 4.9m m³. www.stolt-nielsen.com

BEST IN BREED BRAZIL • STOLTHAVEN’S FOCUS ON SAFE AND SUSTAINABLE TERMINAL ACTIVITIES HAS PAID OFF WITH STEADY RETURNS AND RECOGNITION FROM ONE OF ITS MAJOR CUSTOMERS

 STOLTHAVEN SANTOS IS PART OF BRAZIL’S MAIN EXPORT HUB FOR PHARMA-GRADE ETHANOL

HCB MONTHLY | SEPTEMBER 2021

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ADAPT AND THRIVE RESULTS • VOPAK HAS REPORTED A STABLE FIRST HALF AS IT PROGRESSES WITH ITS PLANS TO ADAPT TO THE COMING ENERGY TRANSITION AND CHANGING PRODUCT FLOWS ROYAL VOPAK HAS reported first half revenues of €603.2m, a 2.4 per cent increase over first half 2020, with group EBITDA – excluding exceptional items – rising by 1.0 per cent to €406.6m. The figures for the second quarter were similarly ahead of last year, excepting that Vopak booked another impairment charge, amounting to €69.7m, recognising “a further deteriorating business environment and lower occupancy rates in the first half of 2021” at the Bahia las Minas

and cost efficiency, notwithstanding weak markets. We continued transforming our portfolio for the future and invested more than €146m in growth.

“Covid-19 pandemic continues to impact the industries we serve and the disruptions in supply and demand of products indirectly impacted performance,” Hoekstra continues.

“The tank storage industry experienced lower earnings as it continues to face supply tightness leading to a lower requirement for

terminal in Panama, which it operates on behalf of Chevron.

Commenting on the results, CEO Eelco Hoekstra says: “In the first half of 2021, combined strategic delivery and financial performance was good, driven by contributions from the growth projects

excess storage of products. During these challenging times, we were able to safely serve and support our customers at all our locations around the world. We are positive on the speed of the shift of our portfolio to industrial and gas infrastructure which supports the acceleration in the field of

HCB MONTHLY | SEPTEMBER 2021

new energies and feedstocks. We are pursuing various options to actively contribute towards hydrogen and ammonia logistics, and new infrastructure solutions for CO2 and flow batteries.”

Overall tank occupancy averaged 88 per cent during the first half, the same as a year ago. Higher demand in the Netherlands, Belgium and Singapore offset declining volumes at Fujairah and in Panama and Indonesia.

NEW AND COMING PROJECTS During the second quarter, the first phase of the new Qinzhou terminal, in which Vopak has a 51 per cent interest, started operation.

The terminal, near the Vietnamese border in southern China, offers 290,200 m³ of tank capacity for chemicals, with five berths for vessels. Since the end of the quarter, the new Vopak Terminal Corpus Christi completed cold

 AS IT LOOKS TO A LOWER CARBON FUTURE, VOPAK IS FOCUSING ON DEVELOPMENTS IN GROWTH MARKETS IN CHINA AND INDIA AND IN PROJECTS TO SERVE INNOVATIVE FUELS AND MEET SUSTAINABILITY TARGETS

STORAGE TERMINALS 13

commissioning and will receive its first products later this year; the terminal is dedicated to serving the needs of the ExxonMobil/Sabic joint venture, Gulf Coast Growth Ventures, which is due to open a new ethane steam cracker and derivative units in the fourth quarter.

This past June, Vopak was awarded a contract for storage and services of a liquid products terminal by Huizhou QuanMei Petrochemical Terminal, which will be built and operated as part of ExxonMobil’s proposed Huizhou chemical complex. Vopak will have a 30 per cent ownership stake in the 560,000-m³ terminal and the pipelines to connect the terminal to the jetty and the chemical plant.

“We are excited for this opportunity to serve ExxonMobil via this greenfield industrial terminal in a safe, sustainable and efficient way,” Hoekstra (right) said at the time.

“This project fits perfectly into Vopak’s growth strategy for industrial terminals.

We are very proud of our expertise and long track record of storing vital products with care for our customers and our drive to continue to invest.”

In mid-July, Vopak announced it had joined forces with Aegis to help develop the LPG and chemical storage and handling business in India, forming a joint venture, Aegis Vopak Terminals, in which Vopak will have a 49 per cent stake. It will operate a network of eight terminals with a combined capacity of some 960,000 m³. The transaction, expected to close early in 2022, will also involve taking a 24 per cent holding in the Hindustan Aegis LPG business, a joint venture between Aegis and Itochu. Vopak will contribute its existing terminal in Kandla to the joint venture, along with Aegis’ sites in Kandla, Pipavav, Mangalore, Kochi and Haldia and the two Hindustan Aegis sites.

“This is an investment in a growth market and by joining forces with Aegis we aim to

for Aegis shareholders due to the deployment into growth opportunities of the combined financial firepower of the two groups and management in the terminals business.”

Vopak also reports that, in collaboration with Gasunie and Gate terminal, it is investigating the development of an independent hub terminal for liquid CO2 on the Maasvlakte in Rotterdam, which will be able to receive and deliver liquid CO2 via ships and will be connected to the depleted gas fields in the North Sea. This will make the necessary infrastructure available to all market parties, including those that do not have a direct connection to a CO2 pipeline.

In addition, the terminal can be an important catalyst in the creation of a market for the reuse of CO2 as a raw material.

strategic locations along the Indian coastline.”

“This joint venture with Vopak will accelerate the growth of Aegis in the terminals business and has the potential

LOOKING AHEAD “We have gained momentum in 2021 in capturing opportunities to serve largescale industrial clusters and will continue transforming our portfolio and position our company in leading locations towards more sustainable forms of energy and feedstocks,” Hoekstra says.

“Our ambition is to be a safety and sustainability leader by focusing on care for people, planet and profit. We continue to seek opportunities towards our ambition to be climate neutral by 2050 at the latest. Our main contribution to a more sustainable world is to actively innovate infrastructure which will contribute to the introduction of the new vital products of the future,” Hoekstra adds.

Part of that innovation involves increasing digitisation and Vopak has continued to roll out its new cloud-based system for its terminals as part of a broader effort to develop its digital architecture across its infrastructure and logistics chains. “Our digital strategy aims to innovate and will allow us to have more access to data in all aspects of our business,” Hoekstra notes. Vopak has committed to

deliver growth over the next ten years in line with the new joint ventures’ and India’s ambition for LPG,” says Hoekstra. “We are very excited for this new partnership. Aegis is a reputed local partner with a ready organisation and proven track record of conceiving and executing tank farm assets in

to allow Aegis to diversify into new areas of gas storage such as LNG and other energy projects including renewables in partnership with the world’s leading independent tank storage company,” adds Raj Chandaria, chairman of Aegis Logistics. “We expect the deal to be significantly earnings enhancing

investing €30m to €50m a year between 2020 and 2022 in IT and says that this year’s spending is expected to be at the high end of the range. “We expect this programme to be completed by the end of 2023,” the company states. www.vopak.com

“WE ARE POSITIVE ON THE SHIFT OF OUR PORTFOLIO TO INDUSTRIAL AND GAS INFRASTRUCTURE, SUPPORTING NEW ENERGIES”

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14 STORAGE TERMINALS

EYES IN THE SKIES INSPECTION • DRONE TECHNOLOGY IS DEVELOPING APACE AND TERMINAL OPERATORS ARE INVESTIGATING WHAT THIS OFFERS THEM. OILTANKING IS TAKING THINGS FURTHER OILTANKING HAS BEEN exploring the potential offered by drones to enhance safety in the operation of its bulk liquids terminals.

While some terminal operators have been using drones, primarily to assist in tank and infrastructure inspection, for some time, by teaming up with Azur Drones, Oiltanking has found plenty of other benefits for its Copenhagen terminal in Denmark.

The drone technology provided by Azur Drones effectively supplements existing comprehensive measures - such as regular inspections by operators and fixed video surveillance - with a holistic, flexible and

such as pipeline inspection during imports and exports or during pumping to Copenhagen’s Kastrup airport (CPH).

More than that, though, the thermal imaging camera attached to the drones allows them to monitor temperature control on specific pumps. The Skeyetech drone is ready to take off 24/7 from its on-site docking station and is operated directly from Oiltanking Copenhagen Terminal control room thanks to its integrations into the existing video surveillance software of the site.

The installation of this technology has been authorised by the Danish Civil Aviation

smart GPS driven monitoring system of Oiltanking’s operations. But that is only scratching the surface of the potential.

Azur Drones’ fully autonomous Skeyetech system provides round-the-clock service and security. It carries out day and night security patrols, as well as operation-specific flights,

Administration.

HCB MONTHLY | SEPTEMBER 2021

 DRONES OFFER A BIRD’S EYE VIEW OF THE TERMINAL WITH ADDED SAFETY AND SECURITY MONITORING LINKED TO OILTANKING’S OWN CONTROL SYSTEM

MORE THAN SECURITY “Health, safety, and environmental protection are key values for Oiltanking,” says Karl Henrik Dahl, vice-president Nordics at Oiltanking, one of the largest independent tank storage providers for gases, chemicals and petroleum products worldwide. “The fully autonomous drone technology not only allows us to support our operations while strengthening the security and safety of our sites but also enhances the use of smart and sophisticated digital technology at our sites.”

Indeed, Oiltanking sees the application as part of its digital transformation, which includes the use of smart and sophisticated digital technologies at its sites.

“We are excited with our collaboration with Oiltanking, which highlights new applications for Skeyetech beyond surveillance,” adds Jean-Marc Crépin, CEO of France-based Azur Drones, one of the world leaders in drone-in-a-box solutions. “This deployment in Denmark, which comes after many other deployments on sensitive and industrial sites, demonstrates our ability to successfully deploy fully autonomous systems abroad, even in the Coronavirus context. Since the beginning of the year, Azur Drones has been accelerating Skeyetech deployments in line with its global ambitions.”

Oiltanking’s Copenhagen terminal offers 460,000 m³ of storage capacity for clean petroleum products and fuel oil. By installing modern autonomous drone technologies, Oiltanking says it is enhancing its safety performance and improving operations management at the site.

Based in Mérignac in south-west France and with offices in Paris and Dubai, Azur Drones acquired the Skeyetech startup in 2017 to be able to offer an out-of-the-box solution for security monitoring of sensitive sites. Since then, it has worked on developing a fully autonomous system that can link with a site’s security network, providing real-time high-definition video and immediate assessment. There are now more than 150 users of the Skeyetech system, which has logged up more than 10,000 operational flights. www.oiltanking.com www.azurdrones.com

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NEWS BULLETIN

STORAGE TERMINALS

OT SHIFTS FROM EUROPE TO ASIA

Oiltanking says it is “an advanced stage” in its strategic review of its European terminals and, alongside its partner 3i Infrastructure, has entered into an agreement to sell four of them to Evos. The divestment of the Amsterdam, Terneuzen, Ghent and Malta terminals is a result of Oiltanking’s continuous evaluation of and optimisation of its asset portfolio, in line with its Strategy 2025 plan.

A final agreement on the sale is subject to employee consultation procedures in the Netherlands and Belgium, along with other customary conditions. Further announcements will be made in due course.

In China, meanwhile, Oiltanking has signed a strategic alliance framework with local authorities in Huizhou covering the development of a world-class logistics and warehousing operation in the Daya Bay Petrochemical Industrial Park. The move follows the relocation of seven tanks within the park

by Oiltanking, to optimise utilisation of the

HCB MONTHLY | SEPTEMBER 2021

available land. The tanks offer 33,000 m3 of storage capacity for petrochemicals.

“This agreement provides an excellent opportunity to further grow the partnership with the Daya Bay government and support the advancement of the Daya Bay Industrial Park,” says Matti Lievonen, CEO of Oiltanking.

“Furthermore, it lays the foundation for further expansion of Oiltanking in Daya Bay Industrial Park, hence strengthening Oiltanking’s presence in China.”

And in Indonesia, Oiltanking Karimun and Matrix Global Holdings are to develop an auction programme for storage capacity at Oiltanking’s terminal on Karimun Island.

Depending on the outcome of a feasibility study and traction from the market, the two companies aim to hold the first auction for fuel oil storage capacity before the end of this year. Oiltanking has already successfully used Matrix’s auction platform for jet fuel and ultra-low sulphur diesel storage at its Copenhagen terminal.

“By developing a digital auction platform for Oiltanking Karimun and partnering with Matrix, Oiltanking has achieved another important milestone in its digitalisation and innovation roadmap, thereby supporting Oiltanking’s vision of being the preferred partner in energy logistics,” says Andy Loh, head of commercial at Oiltanking Asia Pacific.

“We will continue to develop innovative ways, together with partners, that will allow us to even better serve our valued customers around the world.” www.oiltanking.com ENTERPRISE ADDS ETHYLENE

Enterprise Products Partners has acquired a wholly owned subsidiary of NOVA Chemicals, which operates an ethylene storage operation and trading hub in Mont Belvieu, Texas.

NOVA Chemicals, one of the largest merchant ethylene producers and marketers in the US Gulf Coast region, will remain a long-term customer for the facility.

STORAGE TERMINALS 17

“The acquisition, which gives Enterprise ownership of the largest ethylene market hub in Texas since it was established in 2001, will complement Enterprise’s own growing ethylene network in the region,” says Chris D’Anna, senior vice-president, petrochemicals at Enterprise’s general partner. “The combined system offers multiple benefits for producers, consumers and traders, such as increased physical connectivity, greater market liquidity and pricing transparency, as well as improved access to Enterprise’s ethylene midstream services, including our export terminal and growing Gulf Coast pipeline system.” enterpriseproducts.com GREEN CASH FOR ALKION

Alkion Terminals has completed a sustainabilitylinked refinancing of its debt facilities, replacing the €255m raised in 2019 with terms loans amounting to €370m, including €100m for capex and acquisitions. “The improved pricing of the new debt structure is linked to three specific

sustainability targets whose compliance will be monitored by an independent specialised audit firm,” the company notes.

The €100m capex facility is planned to support the 2022-2025 growth programme at Alkion’s terminals, responding to growing demand for petrochemical and biofuels storage with increases in capacity and investments in automation.

“At Alkion we view sustainability as the base of economic resilience and an opportunity for growth,” says CEO Rutger van Thiel. “We take particular pride in the framework we have adopted, which sets measurable sustainability targets and links our financial performance to achieving those targets.” www.alkion.com NUSTAR BACK TO NORMAL

NuStar Energy has reported second quarter net income of $63m, compared to $30m a year ago, with EBITDA up 17 per cent at $189m.

“Strong improvement in our EBITDA was

driven by outperformance across our core strategic asset footprint: our refined products systems, our crude assets and our West Coast Renewable Fuels Network,” says NuStar president/CEO Brad Barron.

“Refined product demand has continued to improve as more and more Americans have returned to normal day-to-day activities,” Barron adds. “After dipping to an average of 95 per cent in the first quarter due to Winter Storm Uri, our second quarter average rebounded back up to 105 per cent of pre-pandemic demand, and we are now forecasting 100 per cent for the full year.”

NuStar has also agreed to sell eight storage terminals to Sunoco for $250m. Seven are in the north-east US and one in Florida. “While these terminals are solid assets with great operations and employees, these facilities are no longer synergistic with NuStar’s core assets, which, in the current competitive climate is critical to their long-term success,” says Barron. www.nustarenergy.com

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18

SIZE IS IMPORTANT CONSOLIDATION • SMALL AND NIMBLE OR BIG AND POWERFUL? THERE’S ROOM FOR BOTH AS CONSOLIDATION IN THE CHEMICAL TANKER SECTOR GAINS PACE AT A TIME of great volatility in global chemical supply chains, it is tempting to take the view that agility is the best response, allowing logistics operators to respond quickly to changes in demand patterns. But there are plenty in the chemical tanker sector who take an opposing view; after all, the demand is there, even if trade flows are changing rapidly

Odfjell, noted that the past five years have witnessed a gradual increase in consolidation within the core chemical tanker fleet, a trend that he expects to continue at a time when financial investors are in divestment mode.

The chemical tanker sector is highly fragmented and the spot market is competitive but, Hammer explained,

in response to underlying product demand and supply issues, with the ripples of the ongoing Covid-19 pandemic, port constraints and weather-related disruptions all playing a part this year.

Speaking recently to investors, Bjørn Hammer, global head of tanker trading at

consolidation is pivotal to removing that fragmentation to make the contract of affreightment (COA) market more dependable – something that will be vital to the financial health of the major players in the sector.

Therefore, developing a larger fleet helps operators to adapt to changing demand

HCB MONTHLY | SEPTEMBER 2021

patterns, by having more ships at their disposal, and to attract more COA business by offering a reliable service. Focusing more on longer-term contracts provides a great deal of protection against volatility in the spot market, which for chemical tankers often reflects the behaviour of the clean product (CPP) trades and the volume of swing tonnage looking for easy chemical cargoes.

The chemical tanker sector is also currently enjoying the fruits of an historically low orderbook, which stands at under 5 per cent of the existing fleet. Consolidation helps the major owners keep a lid on speculative ordering and this is being reinforced by the position of financial investors and by the uncertainty caused by the need to address as yet loosely defined future environmental performance standards.

GREENER TOGETHER That drive for sustainability also helps explain the current trend for consolidation. Chemical tankers are expensive pieces of machinery that are designed with a long working life in

TANKER SHIPPING 19

mind. Owners looking to expand or renew their fleets have to be confident that the choices they are making now will not curtail trading opportunities in the future. There are plenty of examples over the past year of shipowners investing in alternative fuelling and propulsion systems but they come at a cost. Being able to share that cost, through joint ventures, vessel pooling arrangements or other measures, helps to spread the risk.

A prime example of that is a recent announcement by Tufton Investment and Stolt Tankers, under which Tufton will enter seven ‘J19’ chemical tankers in the 19,000 to 22,000 dwt range in the Stolt Tankers Joint Service (STJS) deepsea fleet during the second and third quarters.

As part of the agreement, the two companies are also to collaborate on carbon reduction and sustainability information sharing, jointly exploring and pursuing vessel efficiency and propulsion research, environmental projects and a programme to test the use of biofuels across their combined fleets.

“The addition of Tufton’s ships to the STJS fleet demonstrates Stolt Tankers’ ability to generate customer value in a challenging market by adding tonnage from a top-tier platform to our trading network,” says Lucas Vos, president of Stolt Tankers. “We expect the added ships to improve our overall service offering by enhancing logistical flexibility and synergies while continuing to provide best-in-class environmental and safety standards. I am pleased that Stolt Tankers and Tufton have also formalised their mutual commitment to protecting the environment with the carbon reduction and sustainability information sharing agreement.”

“Tufton funds own twelve chemical tankers, a market segment with a very attractive risk-return profile, especially if operated in a well-aligned partnership like the one we have with Stolt Tankers,” adds Paulo Almeida, chief investment officer at Tufton. “We are very

pleased to have grown our relationship with Stolt Tankers over the past few years, and to work with Stolt Tankers towards aligning the shipping industry with the Paris Agreement.”

EMISSIONS TARGETED The search for decarbonisation does not necessarily have to be collaborative; Stolt Tankers has recently conducted a trial voyage using marine biofuel and reports “very positive” results. The 37,000-dwt chemical tanker Stolt Inspiration bunkered the biofuel, derived from cooking oil, tallow and animal fats, in Rotterdam in April. During the crossing to Houston, a team monitored the performance of the vessel and its engines, fuel consumption and air emissions.

Stolt Tankers says the equipment performed as expected, resulting in a reduction of between 85 and 90 per cent in well-to-exhaust CO2 emissions compared to traditional fuels. This fits well with its ambition to reduce greenhouse gas emissions in line with the International Maritime Organisation’s (IMO) target of a 50 per cent reduction by 2050.

“It’s great to see the positive results of the biofuel trial,” says Vos. “We are exploring several alternative fuels for our fleet as the industry moves towards a carbon-neutral future. We are committed to working with other leaders to explore innovative technologies to reduce our environmental

footprint, while continuing to provide customers with the highest levels of quality and safety that they expect from us.”

Stolt Tankers will continue to investigate the viability of biofuels, taking into account the availability of suitable material and its cost, which is typically around 10 per cent higher than traditional bunker fuels at current prices.

Biofuel does have one big advantage over other non-traditional fuels, in that it is functionally identical to petroleum-derived marine fuels, meaning that no modifications to the engine or fuel infrastructure aboard the ship are required.

And Stolt Tankers has been active elsewhere in promoting consolidation in the chemical tanker market, establishing a joint venture with John T Essberger, E&S Tankers, at the start of this year. The new company has 46 stainless steel parcel tankers under its control, most rated to 1A ice class and operating in northern and Mediterranean Europe.

Vos said at the time: “E&S Tankers will provide enhanced reliability, logistical flexibility, and minimise network inefficiencies across our combined fleets. Furthermore, we expect E&S Tankers to help deliver on our sustainability commitments by reducing CO2 emissions while providing the continued best-in-class environmental and safety standards our customers expect. Most importantly, I expect the newly formed joint venture to deliver significant cost savings.”

 THE MAJOR OPERATORS, SUCH AS STOLT TANKERS (OPPOSITE), HAVE EXPANDED THEIR OPERATIONS THROUGH POOLS AND JOINT VENTURES, WHILE FAIRFIELD CHEMICAL IS GOING ON ITS OWN WITH NEW ORDERS

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

LEADERS AND CHASERS Stolt Tankers’ consolidation activities have fitted alongside similar moves by its main competitors, with both Odfjell and MOL Chemical Tankers growing in recent years through the aggregation of existing tonnage rather than investing in new ships. MOL Chemical Tankers made the step up through its acquisition of Nordic Tankers in January 2019 and has also been developing relationships in bulk liquids storage and the tank container sector.

Odfjell has concentrated primarily on developing new pooling agreements, last year launching an MR pool for coated tankers, which quickly attracted six vessels from Navig8 Chemical Tankers, and following that up with a Handy pool. Transportation Recovery Fund (TRF) has placed six tankers in the Handy pool and one in the MR pool.

“The establishment of these pools adds further flexibility to our operating platform and adds economies of scale by adding incremental revenues with marginal added costs,” Odfjell noted.

and Iino Lines, although Fairfield announced in June an order for two 26,300-dwt stainless steel newbuildings at Fukuoka Shipbuilding, with options on four more. Following the decarbonisation trend, these new ships will have dual-fuel propulsion systems capable of running on LNG. “For 25 years FCC has strived to be an industry leader and innovator,” FCC president Todd Clough said at the time. “We look forward to putting the units into service in 2023 alongside our existing young and fully stainless steel fleet. A commitment to acting quickly and meaningfully to reduce the carbon footprint of our operations in advance of reductions mandated under IMO 2030 is core to our fleet development strategy.”

Jacob de Vries, CCO, was upbeat about the cost implications of the decarbonisation strategy, saying: “Our customers are

additional tanks and other operational/design improvements. LNG pricing and bunkering infrastructure on our trade lanes, increased trading flexibility from the new tank layout, cost saving benefits from the new design, and strong demand from our customers will allow FCC to trade the vessels competitively despite the additional initial cost.”

Meanwhile, in July Aurora Tankers and Golden Stena Baycrest Tankers (GSB) announced a strategic partnership designed to expand the market for stainless steel tankers in Asia. “This joint operation partnership is a step towards building our stainless steel fleet and serving customers with greater flexibility,” says Dexter Say, managing director of Aurora Tankers. “We believe the timing of the partnership is perfect, as the medium to long term outlook for the chemical tanker market is positive. We look forward to working together with GSB Tankers to achieve both companies’ goals.”

Frederik Guttormsen, managing director of IMC Shipping Group, Aurora’s owner, adds that the deal “will give us more scale, drive

Those moves have propelled Odfjell out in front in the rankings of chemical tanker fleets, just ahead of MOL Chemical Tankers and Stolt Tankers, each of which have more than 75 ships at their disposal. The three are well ahead of the chasing pack, led by Hansa Tankers, Fairfield Chemical Carriers (FCC)

increasingly conscious of the necessity to move quickly to reduce CO2 emissions across supply chains and we have been receiving encouragement to bring these next generation ships to market as soon as practical. Of course, a greater investment in the ships is required as we add new propulsion technology,

efficiencies and be a platform for further expansion in the stainless steel chemical tanker segment”.

GSB is a joint venture between Golden Agri-Resources, Stena Bulk and Bay Crest Management, formed at the start of 2019 and with offices in Singapore, Tokyo and Dubai.

HCB MONTHLY | SEPTEMBER 2021

CONSOLIDATION IS ALSO A FEATURE OF MEDIUM-SIZED OPERATORS, WITH AURORA RECENTLY TEAMING UP WITH GSB TO EXPAND THE STAINLESS STEEL SEGMENT IN ASIA

TANKER SHIPPING 21

ALL TO PLAY FOR SUSTAINABILITY • STOLT TANKERS AND THE UK MCA ARE THE LATEST PARTNERS TO JOIN THE CENTER FOR ZERO CARBON SHIPPING, SHOWING THE BREADTH OF EXPERIENCE NEEDED STOLT TANKERS AND Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping have signed a partnership agreement, with Stolt committing to long-term collaboration around the development of zero carbon solutions for the maritime industry. Through this partnership the two organisations commit to extensive knowledge sharing and to exploring future fuel pathways where Stolt Tankers can bring valuable expertise around the challenges and safety aspects of handling fuels and chemicals both at sea and in terminals.

Other possible areas of collaboration include energy efficiency opportunities and new technologies, where Stolt Tankers has a long history of looking across and beyond the shipping industry as a driver of innovative solutions. As a partner, Stolt Tankers will directly contribute through secondments of R&D and shipping experts as well as test capacity of its own vessels in relevant demonstration projects and activities.

“At Stolt Tankers we are committed to working with other industry leaders, our customers and suppliers to build a zero carbon maritime industry,” says Lucas Vos, president of Stolt Tankers. “I strongly believe that the know-how, innovation and creativity needed for a greener future cannot be achieved by any one company alone and am excited to have joined the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping so that we can solve some of the decarbonisation challenges that our industry faces, together.

“Our team will bring valuable insights to the Center through our advanced knowledge and expertise, not only in the chemical tanker segment, but by leveraging the wider

 STOLT TANKERS WILL BRING ITS EXPERIENCE TO BEAR ON THE PATH TO ZERO CARBON SHIPPING

knowledge of our colleagues across the Stolt-Nielsen business,” Vos adds.

PARTNERS ALL Welcoming Stolt Tankers on board, Bo Cerup-Simonsen, CEO of the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping, says: “With Stolt Tankers we are getting a partner with extensive knowledge and expertise in transport and handling of fuels and chemicals, which is critical for assessing viable pathways for future fuels.

They bring an innovative spirit which is evident in their operations, their impressive project portfolio and their commitment to a carbonneutral future for shipping. We look very much forward to the collaboration.”

Stolt Tankers joins a growing list of partners in the Center, which includes Mitsui & Co, Seaspan Corp, Norden, Total, Haldor Topsøe and Alfa Laval as strategic partners, alongside the UK Maritime & Coastguard Agency (MCA), Danish Shipping and the Environmental Defence Fund as knowledge partners.

“Achieving the long-term target of decarbonisation requires new fuel types and a systemic change within the industry. Shipping is a globally regulated industry, which provides an opportunity to secure broad-based industry adoption of new technology and fuels,” the Center says. “To accelerate the development of viable technologies a coordinated effort within applied research is needed across the entire supply chain. Industry leaders play a critical role in ensuring that laboratory research is successfully matured to scalable solutions matching the needs of industry.

At the same time, new legislation will be required to enable the transition towards decarbonisation.”

Welcoming MCA to the Center at the start of June, Cerup-Simonsen said: “Public-private partnerships are a central part of a successful journey towards zero carbon shipping in 2050.

The collaboration with MCA is an excellent example of a highly complementary partnership that will strengthen our ability to create a sustainable transition strategy and influence the enabling regulatory framework.

We look forward to the collaboration.” www.stolt-nielsen.com zerocarbonshipping.com

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Each vessel will use approximately 12,500 tonnes per annum of methanol as a marine fuel. Using widely available ‘grey’ methanol produced from natural gas, greenhouse gas (GHG) emissions in the vessels’ normal commercial operations will be significantly reduced compared to conventional marine fuels, including the virtual elimination of sulphur and particulate matter, a 60 per cent reduction of nitrogen oxide and 10-15 per cent cut in carbon dioxide emissions.

PARTNERS IN GREEN METHANOL • AS ONE OF THE WORLD’S LEADING PRODUCERS OF METHANOL, PROMAN IS LEADING THE WAY IN DEVELOPING A MARKET FOR USE OF THE FUEL IN TANKER BUNKERING PROMAN HAS EXPANDED its newbuilding order at Guangzhou Shipyard with another two 49,900-dwt methanol-powered product/ chemical carriers. The two new orders, to be named Provident and Progressive, are due for delivery in late 2023, following on from the existing order, Promise, due to arrive with Proman in third quarter 2022.

The latest newbuildings will use the same MAN B&W Tier III engines as Promise and the three similar ships ordered by its joint venture with Stena Bulk. They will also be equipped with the latest energy efficiency

Cassidy. “It reflects not only our continued growth but also our commitment to leading the way to a greener shipping future.

Methanol has huge potential to bridge the gap from fossil to fully renewable fuels, with its clean-burning and biodegradable qualities making it particularly attractive as a marine fuel.

“As the second largest global methanol producer, which we transport to all major bunkering ports, alongside our growing investment in green methanol production and vessel ownership, Proman has a presence at

technology, including continually controlled combustion, optimised tuning, redesigned and aerodynamic hull lines, and an energy shaft generator, reducing fuel consumption and helping to meet emissions criteria.

“This is a significant and exciting investment for Proman,” says CEO David

every part of the clean shipping value chain,” Cassidy adds.

HCB MONTHLY | SEPTEMBER 2021

 PROMAN AND STENA BULK ARE LEADING THE WAY TO WIDER ADOPTION OF METHANOL FUEL

SHIPS TO COME Proman will continue to work with Stena Bulk as project manager in the newbuilding phase and as ship manager of the three new ships through its Northern Marine unit. Stena Bulk itself has recently signed long-term timecharters on two Eco-MR tankers being built at Hyundai Mipo for first half 2022 delivery.

The 50,000-dwt newbuilds, which will be named Stena Convoy and Stena Conductor, are said to be nearly 20 per cent more fuel-efficient than the first generation of eco vessels. Stena Bulk is also due to take delivery of the 49,000-dwt Stena Pro Patria, the first of the three methanolfuelled newbuilds ordered in collaboration with Proman, around the same time.

Proman and Stena Bulk see methanol as offering a future-proof pathway to meeting future environmental restrictions in the shipping industry. “With regulatory approval from the International Maritime Organisation (IMO) and growing take-up from some of the world’s largest shipping companies, methanol’s global availability, ease of handling and highly scalable sustainable pathway makes it hard to beat as the shipping sector’s pathway fuel to the future,” says Anita Gajadhar, managing director of Proman Marketing, Logistics and Shipping.

“With the combined advances in vessel design, engine technology and the use of low-emission methanol fuel, these newbuildings will set a new benchmark for sustainable future-ready MR tankers,” she adds. www.proman.org www.stenabulk.com

TANKER SHIPPING 23

A CLOSE SHAVE SUSTAINABILITY • THERE ARE MANY WAYS TO IMPROVE VESSEL EFFICIENCY. ODFJELL IS TRIALLING A SYSTEM TO KEEP THE HULL OF ITS SHIPS FREE FROM SLUDGE WHILE UNDERWAY THE SEARCH FOR greater efficiency in the operation of seagoing vessels, as required by the International Maritime Organisation (IMO), is leading down many paths, with owners and operators looking at different propulsion systems, enhanced hull forms for new ships and operational changes. Ship operators have long known that hull fouling adds to fuel consumption, so that is another area of interest, especially since many traditional anti-fouling coatings have been outlawed because of their adverse impact on the marine environment.

Biofilm begins to form on the hull just hours after a clean ship is put into the water and creates resistance as the ship moves, degrading the hydrodynamic flow along the full and increasing fuel consumption; this is both costly and bad for the environment.

Leading chemical tanker operator Odfjell is examining a solution: a system that brushes marine growth and fouling from the hull at its early stage of formation. The system, developed by Norway-based ShipShave, uses the hydrodynamics from the ship’s forward movement to drive a semi-autonomous robot along and up and down the side of the hull while the ship is underway. A pilot system has

now been installed on the 46,000-dwt tanker Bow Elm during a scheduled drydock.

Explaining the ‘In Transit Cleaning of Hulls’ – or ITCH – system, Jan Opedal, Odfjell’s project manager of technology, says “it’s like a snow brush you use on the car”, except it needs no effort on the part of the user. “It is a lightweight, cost-effective plug-and-play system with an in-built camera to monitor growth. It not only saves fees on manual maintenance inspections and cleaning, but also time and fuel as it is done while the ship is on the move. This means that the vessel can be cleaned much more frequently. Conventional hull cleaning methods are often challenging to arrange and demand stops at anchorage or in drydock, stealing time that could have been better spent moving cargo for our customers.”

PART OF THE PLAN While ITCH covers up to 90 per cent of the hull, Odfjell is also trialling Hasytec’s Dynamic

 REMOVING HULL FOULING WHILE UNDERWAY SAVES TIME AND MONEY FOR SHIP OPERATORS

Biofilm Protection system on the area around the propeller and its blades. This consists of small transducers that delivery highfrequency ultrasound into the water, which prevents the biofilm from settling. Like ITCH, Odfjell says, Hasytec’s system minimises maintenance costs and is environmentally friendly as it targets only the biofilm and single-cell organisms, leaving fish and marine mammals unharmed.

Odfjell has set itself the target of reducing carbon dioxide emissions by 40 per cent from a 2008 baseline by 2030 and sees this fouling reduction project as just one part of that effort. “It is critical to us to maintain a clean hull and propeller on our vessels,” says Erik Hjortland, vice-president of technology.

“Reduced speed or increased consumption due to fouling will negatively affect our Annual Efficiency Ratio. The concept of combining ShipShave and Hasytec has the potential to mitigate this better than by using divers and hull cleaning robots like we do today.” It could prove an important component in meeting the efficiency target.

“Efficiency, fuel consumption and emissions go hand in hand, so Odfjell is improving and renewing the fleet constantly by investing in new ships, retrofit programs and new technology to optimise operations for fuel efficiency,” Hjortland adds.

Odfjell plans to use the two systems in tandem for six months and to collect data about the vessel’s performance and energy consumption to assess their usefulness in meeting its efficiency targets. www.odfjell.com

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TANKER SHIPPING

and auto-logging of inspection start and finish times. Enhanced governance processes will ensure greater transparency and control for OCIMF and other parties involved in the programme, with stringent compliance requirements enhancing accountability.

SAFETY UPDATE INSPECTION • OCIMF’S SIRE PROGRAMME HAS BEEN ONE OF THE MAIN TOOLS FOR IMPROVING TANKER SAFETY. OCIMF IS ABOUT TO TAKE IT A STEP FORWARD WITH A REVISED VERSION THE OIL COMPANIES International Marine Forum (OCIMF) is currently developing an updated and enhanced version of its Ship Inspection Report Programme (SIRE) tanker risk assessment tool, the ship inspection regime that has become central to supporting safety and best practice in the marine industry.

The new regime, SIRE 2.0, which will replace the current system from the second quarter of 2022, is designed to deliver a more comprehensive inspection regime with enhanced tools, strengthened governance processes and more in-depth reporting outcomes, following a risk-based approach.

Significantly, SIRE 2.0 inspections will be completed using an intrinsically safe,

 OCIMF IS ALREADY TRIALLING THE REVISED SIRE 2.0 SYSTEM WITH INDUSTRY PARTNERS

HCB MONTHLY | SEPTEMBER 2021

Ex-proof (IECEx) tablet device, allowing inspections and feedback to be reported and documented in real time. An expanded question set covering core (critical requirements), rotational (ad-hoc), conditional (unique to vessel, operator or ship type) and campaign (a target area of concern) questions will be created for each vessel inspection.

In another key development, every question in the inspection report will be assessed in relation to equipment, processes and human factors.

This approach will allow inspections to be completed more efficiently and enable ‘grades’ of reporting from positive to negative, providing more detailed marine assurance data for identifying and addressing root causes of deficiencies or problems onboard.

The use of tablet devices will also enable inspectors to submit photographic evidence to support findings and allow GPS tracking

MORE COMPREHENSIVE Robert Drysdale, managing director of OCIMF, comments: “Replacing SIRE with a new, improved and altogether more comprehensive SIRE 2.0 regime from next year will mark a significant change for industry – but this change will deliver tangible benefits by enhancing our ability to ensure safety and best practice across the global tanker fleet.

SIRE has served industry well, improving standards of safety onboard, but with more sophisticated risk management tools and resources available, SIRE 2.0 will ensure that this crucial ship inspection programme can continue to evolve in-step with the changing nature of risk in our industry.”

OCIMF has been working on this project to develop SIRE 2.0 since 2017. Three working groups responsible for governance, inspection and technology report to a steering group that is tasked with delivering the new programme.

Sam Megwa, programmes director at OCIMF, adds: “The SIRE 2.0 programme, processes, policies and procedures have now been developed, including the IT software that facilitates the new regime, and a programme of trial inspections is currently underway. We recognise the significance of this change and have been working closely with the OCIMF membership, users of the existing SIRE programme and inspectors as well as industry partners and peers in developing the programme. We have drawn upon their expertise and feedback to build a more robust, accurate and intelligent inspection process that will benefit all.

“There is still much work to be done and the coming months will be critical, but we have absolute confidence that SIRE 2.0 will transform the industry’s ability to protect people and the environment from harm,” Megwa continues. “We look forward to continuing to work with our stakeholders to manage this change.” www.ocimf.org

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NEWS BULLETIN

TANKER SHIPPING

MOL CUTS EMISSIONS

Mitsui OSK Lines (MOL) has strengthened its focus on sustainable shipping operations across its sectors, recently announcing further use of LNG propulsion in bulkers and car carriers, and also reaching agreement with Methanex Corp to take a 40 per cent interest in its Waterfront Shipping (WFS) subsidiary for $145m. WFS operates some 30 modern tankers dedicated to the transport of methanol.

MOL and Methanex have had a strategic partnership for more than 30 years and were instrumental in developing tankers capable of running on methanol as fuel. Now, with the position of Methanex as the world’s largest producer of methanol, WFS as the largest specialist methanol shipper and MOL’s extensive shipping experience, the various parties aim to promote the uptake of methanol, including renewable methanol, as a viable marine fuel.

“We are pleased to expand our relationship with MOL, a world leading shipping company, which will enable Waterfront Shipping to enhance its capabilities by leveraging MOL’s extensive global shipping experience,” says John Floren, president/CEO of Methanex. “We have worked with MOL for over 30 years on methanol shipping since the era of Cape Horn Methanol, a predecessor to Methanex’s Chile operations, and we are confident that our new strategic relationship will help develop the market for methanol as a lower emission marine fuel.”

Takeshi Hashimoto, president of MOL, says: “MOL is pleased to partner and deepen our long-standing relationship with Methanex, the leader in the methanol industry. This transaction is consistent with MOL’s Environmental Vision 2.1, which regards our active involvement in methanol-fuelled ships as one of the measures for adopting clean alternative fuels.”

In addition, MOL unit Phoenix Tankers has ordered an 87,000-m3 VLGC from Namura Shipbuilding, with an option for a second vessel, with delivery slated for 2023. The new ships, designed by Namura and Mitsubishi Shipbuilding, will be used to carry both LPG and ammonia; they will be fitted with engines capable of running on LPG, with the potential to be converted to run on ammonia.

“Ammonia is drawing attention as a next-generation clean fuel that does not emit carbon dioxide when burned, and as a ‘hydrogen carrier’ that can be used to transport hydrogen,” states MOL. “The newly ordered vessels are also designed to transport ammonia and are presently the world’s largest-scale ammonia carriers. Furthermore, the vessels will be built with an eye toward conversion to ammonia fuelled in the future because LPG and ammonia fuels have similar characteristics.” www.mol.co.jp CONCORDIA’S SHALLOW DRAFT

Concordia Damen has launched the first of 40 inland waterway barges being built by Casco in Serbia. The Parsifal-class tankers will be chartered to Shell and operated by VT Group carrying mineral oil between the ARA ports and on the Rhine network. The new barges (pictured left, en route) feature LNG propulsion and are designed for extremely shallow water operation.

“We are pleased to have reached this milestone in this important project. The Parsifal Tankers represent a new generation of eco-conscious vessels that will play a significant role in the maritime energy transition,” says Chris Kornet, CEO of Concordia Damen. “We are looking forward to continuing to develop this project in the coming months.” www.concordiadamen.com

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STOLT SEES SIGNS OF UPTURN

Stolt Tankers has reported operating revenue of $547.8m for the first six months of its financial year, to end May 2021, down from $574.6m a year ago, though operating profit edged ahead from $24.7m to $25.5m. The decrease in freight revenue was due to lower volumes, partially due to severe winter weather disrupting operations in the port of Houston in February and March and to a weak spot market for the deepsea fleet.

“During the second quarter we saw an increase in activity across the board, although this is not fully reflected in the financial results,” says Niels G Stolt-Nielsen, CEO of parent Stolt-Nielsen Ltd. “At Stolt Tankers we saw an increase in overall volume following the delivery of the CTG ships. However, a reduction in contract volumes resulting from the Houston freeze in February and reduced acid nominations, required us to fill capacity with lower-paying spot business while bunker prices continued to rise, which resulted in a slightly lower time-charter equivalent.”

Looking ahead, Stolt-Nielsen notes: “I remain positive about the market outlook for Stolt Tankers, where we have seen a recovery in COA volumes.” www.stolt-nielsen.com FCC GOES TO MARKET

Fairfield Chemical Carriers has ordered two 26,300-dwt stainless steel chemical tankers from Fukuoka Shipbuilding, with options for four more of the same type. The two firm orders are due for delivery in second half 2023. All will be equipped with dual-fuel LNG propulsion and a smart ship platform to optimise performance and safety.

“Our customers are increasingly conscious of the necessity to move quickly to reduce CO2 emissions across supply chains and we have been receiving encouragement to bring these next generation ships to market as soon as practical,” says Jacob de Vries, COO. “Of course, a greater investment in the ships is required as we add new propulsion technology, additional tanks, and other operational/design improvements. LNG pricing and bunkering

infrastructure on our trade lanes, increased trading flexibility from the new tank layout, cost saving benefits from the new design, and strong demand from our customers will allow FCC to trade the vessels competitively despite the additional initial cost.” fairfieldchemical.com EXMAR GOES FOR GREEN

Exmar and Nutrien have signed an agreement to jointly develop and build a low-carbon ammonia-fuelled vessel. Nutrien, one of the world’s largest producers of low-carbon ammonia, has been a customer of Exmar’s shipping services for more than 30 years.

The agreement aims to significantly reduce Nutrien’s greenhouse gas emissions from maritime transport and open up a clear path for wide adoption of low-carbon ammonia as a clean fuel for the maritime industry. The partners aim to deploy an ammonia-fuelled vessel by 2025, with low-carbon ammonia sourced from Nutrien’s plant in Geismar, Louisiana.

“Nutrien is excited to partner with Exmar on our shared journey to drive transformative reductions in maritime emissions,” says Raef Sully, Nutrien’s executive vice-president and CEO of Nitrogen and Phosphate. “This initiative demonstrates how we are taking action to achieve our Feeding the Future Plan’s

2030 sustainability commitments, which include investing in low-carbon ammonia innovations.”

“Exmar has always strived to contribute to innovations and increase efficiencies in gas logistics and transportation. The development of an ammonia-fuelled vessel together with our long-standing partner Nutrien is an exciting and logical next step for us,” adds Jens Ismar, Exmar’s executive director of shipping.

Exmar has meanwhile taken delivery of the 88,000-m3 VLGC Flanders Innovation from Jiangnan Shipyard. The new ship is the largest dual-fuel LPG carrier in the world and will offer a significant reduction in CO2 emissions to well below IMO reference lines for VLGCs. The design of the new ship also contains features to increase energy efficiency and minimise environmental impact.

“We are proud to show the world where we stand as Exmar when it comes to innovation, safety, sustainability and teamwork,” says CEO Francis Mottrie. “Successfully completing a project of this size under current challenging circumstances is a testimony to our crew’s perseverance.”

Flanders Innovation now goes onto a five-year charter to Equinor. A sistership is due for delivery later in the summer. exmar.be

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FIT FOR THE FUTURE EQUIPMENT • PEROLO HAS EXPERIENCED A SURGE IN DEMAND THIS YEAR, MANAGING TO KEEP UP THROUGH INVESTMENT IN PEOPLE AND PLANT AND THE APPLICATION OF NEW IDEAS

France. It has had to respond with additional production capacity but had to do so at a time when supply chains have been stressed, not only by the continuing effects of the Covid-19 pandemic and its associated restrictions but also by disruption particularly in ocean freight, with higher costs and longer lead times.

SINCE THE END of 2020, leading tank valve and equipment manufacturer BIP Perolo has been enjoying a boom in demand for its products. “There has been a complete change in the market,” says Thierry Bourguignon, the company’s CEO. “We have been incredibly busy keeping up with demand – and it keeps

been increasingly successful in supplying the rail sector in the wider Europe, including Turkey, as well as growing demand for specialised valves and fittings for tank containers in Europe, especially for equipment suitable for handling highly corrosive products. This has been “technically

KEEP COMPETITIVE Moreover, Bourguignon reports that – perhaps not surprisingly – his customers are not just looking for more product but also short lead times and an attractive price, a combination he says is “very, very difficult” to achieve.

Perolo, like others in the industry, has been challenged by rising steel prices since early 2021 and a general shortage of supply, making

growing.”

Bourguignon reports strong demand in particular for tank container equipment in Asia and for rail tank car equipment in Europe, with all sectors – the major operators and lessors as well as new entrants to the market – knocking on his door. Perolo has

challenging – but interesting,” Bourguignon says.

While any company would welcome the sort of demand growth that Perolo has experienced this year, it has also created challenges for the company, which is part of the BIP group, based in Blaye in south-west

sourcing difficult. It is not an easy matter to switch to a new supplier, as Perolo’s tank equipment needs a high level of quality and performance from its raw materials. “We have had to qualify new sources of material,” Bourguignon says, “and this has called on the involvement of personnel in all parts of the

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company.”

This shortage of raw materials has been matched by a shortage of people and, Bourguignon adds, it is hard to find people with the experience to be able to slot into the manufacturing process. Perolo does not have the luxury of time to bring new recruits up to the standard needed. Those people it already has are working overtime – Perolo’s Chinese plants have been working seven days a week for the past few months just to keep up with demand.

One thing that has paid off for Perolo is the investments in new technology it had put in place over the past two years. Despite the problems posed by the Covid pandemic, it took advantage of the lower workload experienced during 2020 to implement a number of changes that are now generating increased output.

Not least among these has been wider use of the BIP Laser system of metal cutting, which was first introduced ten years ago. A new factory has been opened in Blaye, offering more space, better and faster cutting, and greater efficiency in the production of valves, manlids and other equipment for tank

 THE NEW BIP LASER PLANT (OPPOSITE) HAS BEEN INSTRUMENTAL IN HELPING PEROLO INCREASE PRODUCTION VOLUMES WHILE KEEPING UP WITH ITS STRICT QUALITY DEMANDS

containers, rail tank cars, road tankers and metal intermediate bulk containers (IBCs).

This alone has helped increase output by almost 100 per cent, Bourguignon says, without the need for additional labour. “This helps the company stay competitive,” he adds.

Similarly, investment has been made in Perolo’s manufacturing facilities in China, in additional machining and welding equipment and in modifying and improving its workshops, which has enabled a further increase in output and maintained its market position.

KEEP SAFE AT WORK The source of this year’s surge in demand is unclear but Bourguignon suspects it is partly a lot of pent-up demand after the drop in activity in 2020 as companies across the supply chain worked out how to cope during the Covid lockdowns. Perolo had similar issues, which again were a challenge for the organisation, but it was exposed to the problems early on in 2020 at its Chinese plants. “It took a few weeks to determine the hygiene measures that were needed,” Bourguignon notes. “Originally we expected them to be in place for a couple of months, but it is now becoming normal. We have learned to work with the threat and it is now a daily routine.” A few staff have had to isolate so the company needs to be flexible in its rostering.

As such, Covid restrictions are not an issue in the workplace – it looks much the same as

ever except that employees are wearing masks. Where the problems come is in longer lead times for supplies, especially those being sourced from half a world away. Getting product out to distant customers is also an issue, though again Perolo has the advantage of having production in China, close to the Asian demand centres. However, Bourguignon says demand is growing around the world as more and more countries now have the same expectations for safety in the transport of dangerous goods – “and that’s a good thing,” he adds.

FOLLOW THE TRENDS Meanwhile, in Europe, there are some interesting and identifiable trends, not least in the rail sector where, Bourguignon suspects, there is growing demand from the chemical industry looking for more sustainable transport solutions. As a result, all operators and leasing companies are looking for efficient, safe and sustainable options. The sector as a whole is modernising, replacing older tank cars with new and more efficient rolling stock, which is underpinning a lot of demand for equipment, both for standard tank cars and those designed to handle aggressive chemicals and high- or low-temperature products.

“We always try to find solutions that will help safety and productivity or meet demand for new products and tank designs,” Bourguignon says. One example of that is the emerging market for composite tank containers, with shells manufactured of fibre-reinforced plastics (FRP). That means appurtenances cannot be welded to the tank shell, so Perolo has been working closely with manufacturers to come up with other answers. So far it is a tiny sector of the market but Bourguignon says such tanks are finding more takers and Perolo’s solution has been “quite successful”.

The company has to keep up with moves in the market such as this and, Bourguignon adds, will keep on investing, improving and reducing its reliance on third party suppliers.

“We want to keep it in-house, under our control,” he explains. “We are looking to secure the future.” www.perolo.com

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SEE IT THROUGH DIGITISATION • THE BENEFITS OF IT SYSTEMS ARE BEING INCREASINGLY RECOGNISED, PARTICULARLY FOR UNACCOMPANIED AND HIGHLY HAZARDOUS LOADS THE DAYS OF simple ‘track and trace’ systems are now far behind us as industry continues along the path to digitisation.

Certainly in those sectors of the supply chain where loads are not always accompanied by personnel – notably in intermodal and rail transport – it has become increasingly expected that transport assets will be fitted with sensors and communications devices that can not only tell the operator (and its customer) where the load is but also the temperature and pressure of that cargo.

Demand for such levels of visibility came initially from receivers, keen to know where their cargo is at any given time, and it rapidly dawned on logistics providers that they could operate more efficiently if they had the same sort of visibility. One recent application shows that the drive for digitisation has reached the top of the food chain: Arkema is to digitise its entire tank container and rail wagon fleet using Nexxiot’s IoT devices and intelligent cloud platform. The project aims to deliver end-to-end visibility for Arkema’s customers and, the company says, to improve quality standards and transform the overall service experience.

“We understand our customers require the highest levels of confidence around the transportation of their cargo,” says Jean-Marc Viallatte, vice-president of Arkema’s Supply Chain Group. “They expect visibility from the moment they place an order to the second that the cargo is delivered. We believe that by

 DIGITAL MONITORING IS ESPECIALLY USEFUL WITH EXTREMELY HAZARDOUS LOADS

HCB MONTHLY | SEPTEMBER 2021

monitoring location and other critical cargo parameters like shock events, temperature, pressure and levels, we can take our customer experience to the next level. Work is underway to deliver predictive services based on data, to increase trust, safety and security as part of our overall digital transformation strategy.”

Stefan Kalmund, CEO of Nexxiot, adds: “Better transportation simply translates to better services for the end customer – the cargo recipient or owner. The data is processed using Nexxiot’s powerful machine learning software to continuously improve supply chain performance. This means reducing the time the fleet stays idle and monitoring the practices of transport partners like carriers. Ultimately, these data-derived opportunities translate to higher quality processes, better prices and an unparalleled end-customer experience. This is why our clients choose our product.”

THE TRICKY STUFF Better visibility is also a distinct boon when transport involves particularly hazardous or sensitive chemicals. Den Hartogh, which has already invested heavily in IT systems, is now equipping its dedicated TDI tank container fleet with GPS Temperature Telematics supplied by Intermodal Telematics (IMT), which will provide live location and temperature monitoring.

The IMT solution uses the new Thermowell probe, which Den Hartogh says is “the ultimate, most robust and most accurate method to measure product temperature” and employs a sensor installed inside a tube, welded to a flange inside the tank. Readings are transmitted wirelessly to a display on the side of the tank, as well as to IMT’s solarpowered communication device, CLT20-Ex. “With the IMT prime GPS unit CLT20-Ex, we receive the temperature through to the portal every five minutes,” explains Peter Boodt, technical supervisor at Den Hartogh. “Via the alerting modules, we can respond immediately to disruptions, assert greater control and minimise risks, waste and product recalls. The accuracy of the Thermowell and the almost real time sending interval of the CLT20-Ex gives us the confidence our customers need when trusting us to carry their temperature sensitive products.” www.arkema.com www.denhartogh.com www.intermodaltelematics.com nexxiot.com

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Easy servicing/High reliability Excellent flow rates Hydraulic or Pneumatic valves Competitive pricing/Low M&R costs

Waste Disposal.

Introducing the new 6” Cleanflow - a valve specifically designed for use on grease trap pumping and waste hauliers, where high flow rates are required (Estimated flow at 25 PSI ΔP 5,000 US gallons/min).

Superior to the more commonly used gate valve, this valve has been on field trials in America since 2015 and has had no issues whatsoever, impressing our customer with its reliability and low operating costs.

Gate valves tend to be heavy and need specialist servicing. The 6” Cleanflow has an unrestricted bore which keeps product residue to a minimum, enabling easy access for thorough cleaning and offering a much faster discharge time. It’s superb flow rates make it an ideal choice for waste product applications.

Pricing is competitive, and M&R costs are much lower. With a 180 degree outlet as standard, 30 and 90 degree outlet options are also available with outlet flange drilling options on request.

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32 TANKS & LOGISTICS

under some of the harshest conditions and including highly sensitive and demanding cargo requirements. Provided that the results of the pilot project prove successful, VTG plans to roll the system out to its entire double pocket wagon fleet from November 2021.

“The Kingpin sensor adds to our digital efficiency and safety practices. We believe this will become standard in the market,” says Dr Hanno Schell, VTG’s head of digital innovation. “As an innovation leader, VTG feels that quality and accountability are highly valued by our customers. We therefore take every advance to enable better services and more trust in rail cargo.”

VTG HAS LONG been at the forefront of the process of digitisation in the European railfreight sector, equipping its varied fleet with a range of sensors and telematics solutions. Its latest project, undertaken in collaboration with Nexxiot, addresses a specific issue in the securing of semi-trailers loaded onto pocket wagons in combined transport operations. These wagons can be vulnerable to adverse conditions such as high

carefully managed.

Furthermore, while crane drivers and ground staff are well versed in handling trailers, when visibility is poor they often have to carry out an inspection with flashlights and rely on an acoustic signal that the pin emits when correctly inserted into the frame.

VTG is now trialling Nexxiot’s Kingpin Monitor solution, a completely maintenancefree sensor solution that keeps a check on the

HELPING THE SHIFT The Kingpin sensor involved in the pilot detects whether the kingpin is engaged and whether the hitch status is open or locked.

There are two displays on the sensor set itself, with one placed on either side of the railcar.

All data collected and transmitted by Nexxiot will be collated in VTG’s platform. This ensures both instant confirmation feedback for in-field operators and also transparency for controllers and decision makers in the management offices. This also means that automated checks can be made at any point in the journey.

The data can be used to confirm and trigger essential events, and business processes can be linked to these checks to ensure sound connection and engagement of these safety enhancing components. Data can also be used to help investigation should an event take place.

“If more goods are to be shifted from road to rail in the future, then it must be ensured that this also happens in a safe manner,” says Stefan Kalmund, CEO of Nexxiot.

“With the Kingpin sensor, we are delivering a cutting-edge digital solution for preventing accidents and supporting employees in their processes. We provide continuous feedback on the status of the hitch both during loading and throughout the journey, using real-time

winds, steep inclines and misaligned kingpins, all of which can compromise safety if not

loading of road-going semi-trailers during the loading process. The sensor provides certainty, because an LED light on the control module signals that the pin is correctly positioned. A second LED indicates that the locking latch is engaged. The application is now being tested on 70 double pocket wagons

communication and providing alarm messages in case the locking status changes.

I am convinced that this innovation together with VTG will lay the foundation for a significant change in the industry.” nexxiot.com www.vtg.com

ELECTRIC KEY DIGITISATION • ENSURING EFFECTIVE SECUREMENT OF SEMITRAILERS IS KEY TO INCREASING CONFIDENCE IN COMBINED TRANSPORT. VTG AND NEXXIOT ARE PLAYING THEIR PART

 NEXXIOT’S KINGPIN MONITOR SOLVES A TRICKY PROBLEM FOUND IN COMBINED TRANSPORT

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INFLATION SITUATION MARKETS • SHIPPERS MAY HAVE TO PUT UP WITH HIGHER COSTS FOR A LITTLE LONGER, WARNS STOLT TANK CONTAINERS, AS ADVERSE CONDITIONS CONTINUE TO MAKE LIFE TOUGH GLOBAL TRUCKING AND shipping costs are likely to stay high for some time, Stolt Tank Containers (STC) expects. Changing trade patterns, increased volatility in supply chains and a low orderbook for containerships are all pushing up industry prices. Tight ocean freight capacity is likely to continue for the foreseeable future, STC says, with demand coming back as the global vaccine rollout prompts some economic recovery.

Furthermore, the worldwide driver shortage is only getting worse as drivers have migrated to other services during the Covid-19 pandemic.

“The last time our industry saw conditions even close to resembling the current market was prior to the financial crisis of 2008,” says Mike Kramer, president of STC. “However, it is becoming increasingly clear that the conditions we face today are unprecedented in nature, with multiple issues occurring simultaneously.”

The effects of the pandemic have lately been overlaid by several other unexpected

 INTERMODAL OPERATORS ARE EXPOSED TO DISRUPTION IN THE GLOBAL MARITIME TRADES

HCB MONTHLY | SEPTEMBER 2021

events, notably the Texas freeze in February and the closure of the Suez Canal, both of which impacted short-term trade. When viewed globally, these multiple factors are creating a very challenging market and the disruptions, shortages and inefficient service from carriers have caused a substantial increase in costs.

“Along with rapidly rising ocean freight costs, other factors are also compounding the situation,” Kramer continues. “Adding to the size of our fleet and hiring additional manpower to deal with the extra work generated by blank sailings and the subsequent rerouting of tanks and rising fuel prices all add to our costs.”

PASS IT ON “Unfortunately, like many logistics companies, producers, and even customers, we have no choice but to increase our prices to offset these cost increases and to ensure supply chain stability,” Kramer notes. “We have also increased our demurrage tariff rates and reduced free time included in our contracts.

Forecasts indicate that the blank sailings, rolled bookings from carriers in all markets, port congestion and high demand, will

continue well into the future and as a logistics provider we are not be able to absorb these, so they will be passed on to shippers.

“One advantage that I believe we have at STC is our strong long-term relationships with our customers, our ocean carriers and other vendors that are helping us move our cargo,” Kramer continues. “In dealing with the unprecedented conditions, we are working with both our customers and vendors in a collaborative fashion to minimise cost increases and to digitise as much activity as possible and increase transparency in other areas of the supply chain. We have made significant investments in digitalisation in recent years and have integrated our systems electronically with both shippers and vendors to reduce waste and inefficiencies so that we are able to keep related administrative costs low.”

Despite the challenges, there are some opportunities ahead, explains Kramer. “We are seeing incredibly strong demand across all geographies and sectors of the market as economies begin to rebound from the pandemic and consumer confidence improves.

This is driving our customers to restock and restart, or increase, production to full capacity. We are also seeing very strong growth in demand as cargo moves from unsustainable flexibags back into tank containers.

“Our focus is to remain agile so that we can continue to deliver the highest levels of service at the lowest possible cost to our customers while working to create additional efficiencies for the future.” www.stolttankcontainers.com

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A LARGE SCOTCH FOR STOLT

Stolt Tank Containers (STC) has opened a new tank container depot in Grangemouth, UK, Tank Wash Scotland Ltd. Grangemouth is the largest port in Scotland, STC notes, and an ideal location for a depot to support its customers, with convenient connections to the local railfreight network and proximity to Scotland’s main road arteries.

The new depot offers state-of-the-art cleaning, heating, storage and repair of road tankers and tank containers, both STC’s own tanks and those belonging to third parties. It has one segregated drive-through wash bay for foodgrade products, six fixed food bays, two drive-through wash bays for chemical tanks and tankers, three test bays, three hot work repair bays, 12 steam-heating bays and parking for 30 trucks. Its wastewater treatment plant is optimised for limiting water use and reducing transport-related CO2 emissions.

“I am delighted to announce that our latest depot is now up and running,” says Mike Kramer, president of STC. “Our long-standing

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relationships with customers, coupled with the expertise of our highly experienced local team, will deliver value and quality to local markets.

This is another step in our journey to optimise logistics by investing in facilities close to our customers and the digitalisation of our processes.”

When fully operational the Grangemouth site will have the capacity to house 240 tanks and will serve the needs of customers in the local petrochemical industry and food and drink sector, which is by far Scotland’s largest export market. In addition to aligning with STC’s sustainability strategy, the investment also supports the Scottish Whisky Association’s ambitions for a circular economy and transitioning to net zero by 2040. www.stolttankcontainers.com JOST BUYS IN BELGIUM

JOST has acquired Anné-Louagie, a Temsebased container haulage specialist, which recorded 2020 turnover of €12m. The company has a strong presence in the French and Swiss

markets, with a focus on the movement of ADR and reefer containers. All personnel, including the two founders of the company, and its ten vehicles will now joint JOST. “With JOST, we have found a buyer with whom we can continue to offer the same flexibility to our clients, while benefiting from the advantages of belonging to a larger group,” says Marc Anné, who founded the company in 2003 with his wife Mady Louagie. “I myself will remain on board, along with my wife, to make sure the transition goes smoothly for staff, customers and the 70 contractors.” jostgroup.com LAG GIVES COMFORT

Comfort Energy, the largest independent fuel distributor in Belgium, has expanded its road fleet with 22 new vehicles from LAG. The two firms have worked together since the 1990s, with LAG supplying more than 200 fuel tankers over that time. The latest order is part of Comfort’s project to reduce its carbon footprint and those of its customers, with the

TANKS & LOGISTICS 37

vehicles featuring lighter tanks and more efficient piping, to reduce fuel consumption and spillages.

The latest batch of new vehicles comprises 20 rigid tankers ranging in size from 10,700 to 23,300 litres, as well as two semi-trailers. They have a uniform design for the superstructure, meaning that all parts are interchangeable.

“This is a welcome innovation,” says David Delellio, COO of Comfort Energy. “The uniformity saves time and money. The same design across all types is easier for users to learn. We set up all the appliance cabinets similarly and save a lot of time. This is a pure win-win situation.” www.lag.eu SUTTONS GOES FOR SLUDGE

Suttons Tankers has taken delivery of 14 new Volvo FMXs, the first rigid trucks to join its fleet, after being impressed by their design.

The new units will be deployed exclusively on a contract with Yorkshire Water for the transport of sludge.

“We’ve run Volvo for many years, but this is the first time we’ve opted for FMX rigids,” says Mark Scott, fleet engineer at Suttons Tankers.

“Our contract work is very particular, so the team road-tested the truck over two days through the rolling Yorkshire Dales to see if they could handle the job. We were able to assess a variety of factors that impact on each job, including access, turning circles, manoeuvrability and traction, and to say we were impressed would be an understatement.

The demonstrator performed exceptionally and ticked all the boxes.” www.suttonsgroup.com EVOS ON STATION

Evos has commissioned a new railcar loading station at its bulk liquids storage terminal in Hamburg. Evos has invested some €22m in the new facilities, with the aim of increasing rail loading capacity for middle distillates by more than 40 per cent. New pump technology will allow two tank cars to be loaded simultaneously and the new station also features innovative bio-blending capabilities, allowing biofuels to be blended during loading.

In addition, the new station will also improve the terminal’s carbon footprint: necessary

railcar manoeuvring will now be handled by a cable pull system, removing the use of diesel-powered shunting locomotives.

“We demonstrate with our new railcar loading station that Evos Hamburg continuously develops its service offering according to the requirements of the market and our customers,” says Ulfert Cornelius, managing director of Evos Hamburg. “The new station – and the resulting increased terminal capacity – provide existing and future clients our established outstanding level of service provision and market-leading standards in safety, sustainability, and efficiency yet again.”

“We have invested in our terminal in the port of Hamburg because we are convinced that we will need liquid goods and therefore storage terminals if we want to successfully implement the energy and mobility transition,” Cornelius adds. “In fact, we cannot just count on electrification if we want to reach our ambitious climate protection goals but need to include climate-neutral, liquid fuels and all available technologies to do so. Evos believes in the port of Hamburg as a key energy hub for the import of green energy sources and fuels.” evos.eu DP TAKES AIM AT IMPERIAL

DP World has made an offer to acquire all the outstanding shares in South Africa-based Imperial, for a cash consideration equivalent to some ZAR 12.7bn ($863m). The proposed deal will include Imperial’s Logistics International

business, which has a strong focus in European chemical logistics. It will also expand DP World’s logistics footprint in Africa.

“Combining DP World’s world-class infrastructure, specifically its investment and expertise in ports on the African and European continents, with Imperial’s logistics and market access platforms will enable us to offer integrated end-to-end solutions along key trade lanes into and out of Africa and accelerate our position in Europe, driving greater supply chain efficiencies and ultimately enhancing value for all stakeholders,” explains Mohammed Akoojee, Group CEO of Imperial.

Sultan Ahmed Bin Sulayem, Group chairman and CEO of DP World, adds: “We are excited to announce the proposed acquisition of Imperial, which will add significant strategic value to DP World given its attractive footprint and strong logistics solutions capability. Imperial has a significant presence in Africa, a market where trade is expected to grow at more than 2x GDP driven by population growth, accelerated urbanisation and rising middle classes. Imperial’s business strongly complements DP World’s existing footprint in Africa and Europe and will allow us to deliver a fully integrated end-to-end solution to cargo owners across a wider market.”

The transaction is subject to approval by Imperial’s shareholders, regulatory approvals and customary completion conditions. www.dpworld.com www.imperiallogistics.com

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GROWTH MARKETS

IMCD HAS ACQUIRED Shanghai Yuanhe Chemicals, a specialty coatings, textile and ink solution distributor for the China market.

Yuanhe generated sales of €13.2m in 2020 and will add 20 employees to the IMCD China team.

“Combining forces with Yuanhe provides IMCD a strategic move into the China coatings market and complements the sustainability ambition of our global Coatings & Construction Business Group with a strong focus on environmental-friendly coatings solutions,” says Frank Schneider, business group director, IMCD Coatings & Construction.

presence and customer base, we will create many more opportunities for our loyal customers and principal partners. We look forward to the integration with IMCD.” The acquisition will boost IMCD China’s technical capabilities with the addition of a full-scale formulation lab in Shanghai, further strengthening IMCD’s global network of technical centres, the company states.

LATIN EXPANSION IMCD has also acquired Andes Chemical Corp, marking its entry into the chemical distribution business in Central America and

IMCD Americas. “We are delighted to welcome the Andes Chemical team to further enhance IMCD’s Americas footprint and offering.”

Andes Chemical, based in Miami, Florida, was founded in 1986 and generated revenues of $46m in 2020. It mainly serves the CASE, construction, cosmetics, personal care, plastics, pharmaceutical and HI&I sectors.

“We are ready to accelerate the growth potential with IMCD in the region and are confident that the enhanced commercial capabilities and global network of formulatory specialists will add great value to both our supplier partners and customers,” says Fernando J Espinosa Jr, president of Andes Chemical. “IMCD has displayed impressive growth over the past 25 years, so joining the company to further progress its storyline together is an exciting opportunity for us and our partners.”

The Andes acquisition was announced just a few days after IMCD acquired an 80 per cent shareholding in the Colombia-based specialty chemicals distributor Siliconas y Químicos.

Sherry Lee, owner and managing director of Yuanhe, comments: “We are excited to join IMCD to make a difference in the marketplace of coatings, textile and ink solutions through technical expertise and global connections.

With IMCD’s reputation for professionalism and industry focus, plus Yuanhe’s strong local

Peru and further strengthening its presence in Latin America.

“Andes Chemical’s focus on speciality chemicals and strength in a number of IMCD’s core markets was an excellent fit and perfectly complements the presence we have in the region,” says Marcus Jordan, president of

IMCD expects to take full control of the company during 2022. Immediately following the investment, Pilar Castellanos Pineda, co-founder and general manager of Siliconas y Químicos, was appointed managing director of IMCD Colombia, replacing Oscar Clavijo, who is to retire shortly.

ACQUISITIONS • IMCD HAS CONTINUED ALONG ITS GROWTH PATH, MAKING THREE SIGNIFICANT INVESTMENTS IN RECENT MONTHS IN CHINA AND LATIN AMERICA

HCB MONTHLY | SEPTEMBER 2021

CHEMICAL DISTRIBUTION 39

“I have been very impressed with IMCD and its entrepreneurial approach to be a market leader in Latin America,” Catellanos says. “It is a special time to join the company and have a strategic role in developing IMCD’s story in Colombia. The opportunities for growth with suppliers and customers are exciting, and I am committed to strengthening IMCD’s technical and commercial footprint as a reliable solutions provider and formulatory expert,” she adds.

MORE IN MEXICO IMCD has continued growth in Latin America with a focus also on Mexico, where IMCD México has now fully integrated Millikan and Banner Química into the organisation following their acquisition in December 2020.

“In only 15 months since IMCD México was officially established, not only have we grown organically, but we were able to fully integrate three companies into one IMCD organisation,” says Miguel Ruiseñor, managing director of IMCD México. “We have high ambitions for continued growth within this key LATAM market. Embarking on this new adventure as one team, this integration strengthens our operations and upholds our commitment to

 IMCD’S ACQUISITIVE NATURE HAS HELPED IT OVERCOME MARKET HEADWINDS WITH CEO PIET VAN DER SLIKKE (BELOW) OPTIMISTIC OF FURTHER GROWTH TO COME IN THE SECOND HALF

progressing the development of all our core markets in México to create a world of opportunities for our supplier partners and customers alike.”

IMCD arrived in Mexico through the acquisition of DCS Pharma in 2019, which was rebranded in April 2020. Following the integration of Millikan and Banner Química, IMCD México now has 80 employees and operates three market-focused laboratories to complement and support its commercial and technical activities.

In addition, IMCD has agreed to acquire specialty chemicals distributor Materias Químicas de México (Maquimex), an assetlight provider of commercial and technical expertise in the preservatives HI&I, energy, water treatment and other industrial markets.

“For nearly 45 years, Maquimex has played an important role in Mexico’s supply chain by offering solutions that reflected our commitment to innovation, sustainability and collaboration,” says Luis Katz, general manager of Maquimex. “Joining IMCD México upholds our company’s mission to serve our industries with a steadfast purpose. The expanded capabilities and global expertise that we now have through IMCD will progress our value and the opportunities available to the customers and supplier partners we serve.”

Ruiseñor adds: “As we welcome Maquimex to IMCD México, we are together now also able to offer substantial coverage to the

industrial markets, reinforcing our commitment to develop opportunities for our supplier partners and to support our customers by delivering solutions and market innovation.”

MAKING A CONTRIBUTION Meanwhile, IMCD has reported “very strong” results for the first half of 2021, with gross profit up 23 per cent compared to the year earlier at €410.9m and operating EBITA ahead by 46 per cent at €192.3m.

“After a promising start of the year, the positive momentum continued into the second quarter and our teams across all regions were able to benefit optimally from the strong product demand. This has resulted in double digit growth numbers,” says CEO Piet van der Slikke. “All regions achieved substantial organic growth and contributed to the overall positive results. It remains to be seen how the pandemic will influence the current economic conditions, but we are optimistic that we can further execute our growth strategy successfully in the remainder of the year.”

A close read of IMCD’s half-year results shows improved margins and profitability in all territories but also a long list of acquisitions over the past year that have contributed to the increase in revenues. In the EMEA region, revenues were up 17 per cent, with the 2021 figures including the impact of the acquisition of Kokko-Fiber in September 2020 and, in January 2021, of Ejder Kimya, Peak International Products and Siyeza Fine Chem. Similarly, revenues in the Americas division rose by 8 per cent compared to first half 2020, helped by the acquisition of Brazil-based VitaQualiy in August 2020 and Millikan and Banner Química in December 2020. In the Asia-Pacific region, revenues were up by 48 per cent, much of which represents organic growth, although there were additional contributions from the Chinese pharmaceutical business of Develing International, acquired in July 2020, and Signet Excipients, acquired in November 2020.

IMCD says it “sees interesting opportunities to increase its global footprint and expand its product portfolio both organically and by acquisitions.” www.imcdgroup.com

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ORGANIC CHEMISTRY RESULTS • BRENNTAG’S RESTRUCTURING PROCESS, COMBINED WITH EXTERNAL FACTORS AND FURTHER ACQUISITIONS, BOOSTED PERFORMANCE IN THE FIRST HALF BRENNTAG HAS REPORTED second quarter gross profit of €838.7m, up 21.1 per cent on the same period last year, with operating EBITDA up 34.3 per cent at €355.1m, in what

Brenntag Essentials and Brenntag Specialties.

Brenntag Specialties performed particularly well in the second quarter.”

CFO Georg Müller adds: “The overall

the company calls “an exceptional market environment”. Sales were ahead by 23 per cent year-on-year at €3.47bn.

Christian Kohlpaintner, CEO, says: “We achieved excellent results in the second quarter and are highly satisfied with the performance of our two global divisions

exceptional business dynamics and market environment of the first months of 2021 continued into the second quarter. We again benefited from good margin management and were able to generate high gross profit per unit. Additionally, we saw volumes sequentially improving throughout the quarter.”

HCB MONTHLY | SEPTEMBER 2021

Brenntag Essentials, which markets a broad portfolio of process chemicals across a wide range of industries, posted an operating gross profit of €523.1m, up 16.3 per cent on the second quarter 2020, with operating EBITDA of €230.1m, 29.1 per cent up; North American operations in particular made a significant contribution, the company notes.

Brenntag Specialties posted even better figures, with operating gross profit up 30.1 per cent at €308.9m and operating EBITDA ahead by nearly 50 per cent at €144.5m. “These remarkable results are due to a broad-based positive performance across all segments and were driven almost entirely by organic growth,” Brenntag says.

CHANGE IN HAND This year’s second quarter figures partly reflect the change since the same period last year, which was the first to be impacted by the

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global Covid-19 pandemic and the sudden changes to supply chains that it caused. On the other hand, a lot of the growth over the past year can be attributed to internal measures, with the Project Brenntag initiative already generating savings; Brenntag says that the restructuring of the group into two operating divisions, which took effect at the start of 2021, helped generate more than €40m in operating EBITDA in the first half of the year and it now expects this to ramp up to an annual figure of €220m by 2023, as part of a new phase that will focus on improving EBITDA yet further.

Project Brenntag is seen as a broad transformation programme under which the group will aim to adopt “a more focused approach to our market activities, build stronger partnerships with our customers and suppliers, and reduce complexity”. One element of that includes a rationalisation of its operations, with some 100 sites identified as candidates for closure; of these, 58 had been closed by August this year, with the loss of some 480 jobs. Brenntag says it has another 800 or so positions to be eliminated over the coming two years, which will be done in a socially responsible manner; the company is already in close dialogue with works councils in different countries.

Since the strong performance posted in the second quarter, Brenntag has raised its forecast of its full-year results, now expecting EBITDA to be in the range of €1.16bn to €1.26bn. Kohlpaintner (right) is not complacent, however, saying: “We expect the currently exceptional market conditions to remain with us. The Covid-19 pandemic will also continue to bring a certain degree of uncertainty. Overall, we are very pleased with our business performance so far in 2021, and Brenntag is superbly positioned to adapt to the conditions and continue this good business performance in the further course of the year.”

 RESTRUCTURING BRENNTAG ALONG BUSINESS LINES, TOGETHER WITH ACQUISITIONS IN CHINA AND THE US, SHOULD HELP TO CONTINUE TO IMPROVE SALES AND MARGINS

BUYING THE MARKET Another important aspect of Brenntag’s recent growth has been its expansion through acquisition. At the end of July, the group closed the acquisition of the first tranche of shares, equivalent to 67 per cent, in Zhongbai Xingye, a specialty distributor of food ingredients in China, for €64.6m. Brenntag is aiming to acquire the remaining shares by the end of 2024.

“The acquisition of the leading player in mainland China is an important step towards Brenntag becoming a full-line distributor of food ingredients in the Asian market,” Brenntag says. The company also bought out its joint venture partner’s 49 per cent holding in Hong Kong-based Wellstar Group, which specialises in the distribution of pigments and additives in China, in late June.

Speaking at the time of these transactions, Henri Najade, COO of Brenntag Specialties, said: “Strengthening our Brenntag Specialties division, particularly in China, as well as in the Asia Pacific region in general, is a central pillar of our company’s M&A strategy. I am particularly delighted that we stuck exactly to our timing in both cases and were able to

successfully close the important acquisition steps in the dynamic and growing Asian markets as planned.”

At the beginning of August this year, Brenntag also closed the €255m acquisition of US-based Storm Chaser Holding which, under the ‘JM Swank’ brand, is a leading distributor of food ingredients in North America. “This strategic acquisition doubles Brenntag’s size in the nutrition business in the region and thus creates the leading food ingredients and food process chemicals distributor in North America,” Brenntag says.

AHEAD IN AMERICA Another major move came in early August when Brenntag acquired all the operating assets and business of Matrix Chemical, a leading distributor of solvents and acetone in North America, for €48.5m; Matrix’s year-to-date sales in 2021 amount to some $200m. Matrix operates storage tanks at bulk terminals in Houston, Chicago, Vanport, PA and Wilmington, NC. “With the acquisition of Matrix we create a highly reliable and competitive logistics network for acetone and solvents in North America that allows us to take advantage of market opportunities and to deliver a variety of core products to our customers more efficiently, economically and in a more sustainable manner,” says Steven Terwindt, COO of Brenntag Essentials. “Overall, we expect significant operating synergies by leveraging Matrix’s supplier relationships, logistics network and bulk storage capacity in combination with Brenntag’s existing North American infrastructure and outbound logistics.”

Anthony Gerace, managing director of M&A at Brenntag, adds: “Matrix and its terminals in the US perfectly complement our existing network in the region. The acquisition is strategically aligned with our growth strategy in North America as it creates substantial additional acetone capacity in key geographic areas at advantaged barge economics. The combined network will improve our geographic coverage and operating efficiency and allow us to better serve our customer and supply partners alike.” www.brenntag.com

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in industrial solutions as well as chemical price inflation.

The ongoing integration of the Nexeo acquisition continues, with Univar saying it expects to achieve the targeted $120m in net synergies by early 2022. It also says it made “significant progress” during the second quarter on its S22 programme, which is designed to improve operational agility, drive faster sales growth, particularly in North America, and maximise net free cash flow conversion. Under S22, Univar is focusing on improving adjusted EBITDA margins and reduce leverage.

UNIVAR SOLUTIONS HAS reported adjusted net income of $97.4m for the second quarter, well ahead of last year’s $55.7m, with adjusted EBITDA rising from $163.2m to $197.5m. “We are pleased with another strong quarter of results based on the successful execution of our growing together strategy, the advancement of our Streamline 2022 (S22) programme, and market share growth,” says David Jukes, president/CEO. “In a period of strong customer demand and constrained supply, we believe our operating infrastructure and ability to identify trends, grow our supplier and customer relationships, as well as build on investments in both digital

our customer and supplier partners.”

“As we enter the back half of 2021, we expect more normalised margins and continued market share growth as we keep the customer at the centre of all we do,” Jukes adds.

In the US, external sales increased by 28.3 per cent compared to a year earlier, primarily due to higher industrial end market demand and chemical price inflation. In Canada, sales fell by 28 per cent following Univar’s exit last year from the Canadian agriculture sector; adjusted EBITDA was down by just 0.8 per cent, again as a result of returning demand from industrial end markets and chemical

OPENING IN CANADA Univar has also begun construction work on a new custom-designed facility in Abbotsford, British Columbia. The SAP-ready facility is expected to open during the first half of 2023 and aligns with Univar’s long-term sustainability commitment to achieve net-zero emissions by 2050, through the implementation of the latest emissions standards and innovative logistics and storage concepts, including a site-wide tank telemetry system for real-time product inventory visibility.

“Central to our Growing Together strategy is our customer, and the new Abbotsford facility will improve our ability to quickly and safely deliver products when and where they are needed with minimal carbon footprint, making us easier to do business with and helping us fulfil our purpose to keep communities healthy, fed, clean and safe,” says Chris Halberg, vice-president of Local Chemical Distribution for Univar Solutions in Canada. “We’re excited to build on our leading position in the British Columbia market with more growth opportunities for our suppliers to meet local customer needs.”

The new facility will offer larger storage capacity for chemicals and ingredients, alongside rail connections and specially

and our growing global specialty end market verticals, has us well-positioned to support

price inflation. Similar conditions were experienced in the EMEA division, where sales were up by 23 per cent year-on-year, tempered only by the divestiture last year of Distrupol. Sales in Univar’s smallest division, Latin America, were up by 53.3 per cent, largely due to higher demand for products

designed blending rooms for solvents, corrosives and oxidisers. This will help make blending more efficient while reducing the risk of incidents by means of the latest engineering controls and state-of-the-art containment technology. www.univarsolutions.com

THE RIGHT MIX

RESULTS • RETURNING DEMAND FROM INDUSTRIAL CUSTOMERS HELPED UNIVAR POST STRONG FIGURES AS IT PRESSES ON WITH ITS STRATEGIC PLANS

 UNIVAR’S LATEST PROJECT IN CANADA WILL ALIGN WITH ITS SUSTAINABILITY COMMITMENT

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CHALLENGING TIMES BUSINESS • IT IS NO SECRET THAT GLOBAL CHEMICAL SUPPLY CHAINS ARE STRAINED. CBA’S LATEST QUARTERLY SURVEY IDENTIFIES JUST WHAT THAT MEANS FOR ITS MEMBERS

THE LATEST SUPPLY Chain Trends survey, carried out every quarter by the UK Chemical Business Association (CBA), identifies some extreme stresses in the sector. Some 85 per cent of CBA members surveyed report shortages of shipping containers; 90 per cent report rapidly escalating shipping costs; and 62 per cent report capacity issues with road haulage in the UK, with 76 per cent reporting similar constraints in the EU. “The current business situation has improved over the last three months, but most

 UK DISTRIBUTORS ARE FACING SUPPLY CHAIN DISRUPTION AND A CHRONIC DRIVER SHORTAGE

member companies are reporting serious issues in the international supply chain resulting in significant delays, logistical gridlock, and massively increased shipping costs,” says Tim Doggett, chief executive of CBA. “This is compounded by the chronic shortage of HGV drivers aggravated by the combined impact of Brexit and Covid-19.”

CBA’s online Supply Chain Trends Survey was conducted between 8 and 18 June 2021 and is based on responses from 72 member companies.

BETTER OR WORSE? CBA’s Survey also followed up on the regular questions about business conditions and confidence in the chemical supply chain. Here

it asks companies to provide information on order books, sales, sales margins and employment, on a ‘better–worse–same’ basis.

To measure short-term trends, the analysis ignores responses answering ‘same’ and focuses on the positive or negative balance provided by the difference between the ‘better-worse’ responses.

The current survey shows a positive balance of +35 per cent in the strength of orderbooks over the past three months - an improvement of +21 per cent since the last survey in March 2021. Current sales volumes have also risen over the last three months, showing a positive balance of +43 per cent (compared to +26 per cent in March). The trend for the next three months is significantly weaker, showing a positive balance of +6 per cent - a fall of 24 per cent on the figure reported in Mach 2021, which evidently underestimated the strength of the upturn in business.

Business conditions over the past year have put great pressure on sales margins but the latest survey indicates this situation may be improving. Current sales margins have moved into positive territory at +11 per cent, a survey-to-survey improvement of 39 per cent since March. Future sales margins are forecast to decline in the next three months, with a negative expectation of -15 per cent, compared to the modest optimism of +6 per cent reported in March.

Finally, CBA member companies were asked if their employment levels will be higher, lower, or remain the same over the next three months. The employment trend shows a continued improvement with a positive balance of +35 per cent, slightly ahead of the +33 per cent recorded in the last quarterly survey in March 2021.

CBA represents the independent chemical supply chain with a membership that includes distributors, traders, warehouse operators, along with logistics and transport companies, most of them classed as small or mediumsized enterprises (SMEs). Its distributor members have a combined annual turnover of some £2.75bn and employ more than 8,700 people distributing, packing, and blending key chemical components and services to virtually every sector of the UK economy. www.chemical.org.uk

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NEWS BULLETIN

CHEMICAL DISTRIBUTION

AZELIS INCREASES REACH

Azelis has continued its expansion drive, having recently announced two acquisitions.

In South Korea, it has agreed to acquire Coseal, a specialist in the distribution, repackaging and blending of agricultural and horticultural surfactants.

“Like Azelis, Coseal has strong technical expertise and strives to continually provide tailor-made formulations to customers. This has been critical in building Coseal’s long-lasting and collaborative relationships,” says Laurent Nataf, CEO/president of Azelis Asia Pacific.

“Azelis in South Korea has been largely focused on personal care, so we’re very excited to enter the agricultural/horticultural market with such a reputable partner by our side.”

Azelis entered the South Korean market in 2018 with the acquisition of personal care specialist SammiChem, now known as Sammi Azelis, and expanded earlier this year with the acquisition of food distributor MH. Azelis has also acquired Quimdis, a leading French distributor of ingredients for nutraceuticals, flavours & fragrances, animal nutrition, personal care, pharma and food.

“Following our recent acquisition of Vigon in North America and now Quimdis, Azelis is well positioned to develop, structure and implement a global strategy for flavour & fragrance market with the aim to become a market leader,” says Hans Joachim Müller, president/CEO of Azelis. “Quimdis will be our EMEA pillar of that strategy and a crucial part of creating a global flavour & fragrance platform. Quimdis and Azelis will combine its relationships with top tier principals, with the aim of extending mandates in existing and new countries for a number of attractive product groups.”

Jean-François Quarré, founder and CEO of Quimdis, adds: We are delighted about the opportunity to continue to grow our business under Azelis’ ownership. As well as benefitting from Azelis’ global principal relationships,

HCB MONTHLY | SEPTEMBER 2021

Quimdis will have access to Azelis’ digital marketing and technical capabilities which will allow us to develop and promote innovative and sustainable solutions for the life science industry. Becoming part of the Azelis family provides many synergistic opportunities that will help secure our future.” www.azelis.com BEST FOR BIESTERFELD

The Biesterfeld Group generated total revenues of €1.03bn last year, down on the 2019 figure as a result of the Covid-19 pandemic, and an operating profit of €42.8m, which surpassed its targets. All four operating divisions made a positive contribution and the group succeeded in expanding its market shares and adding new partners and products to its portfolio to enable ongoing strategic developments over the long term.

“2020 was a challenging year for everyone,” says CEO Thomas Arnold. “But thanks to our 900 employees around the world, we managed to master it beautifully. Everyone actively adapted to the situation with utmost flexibility and they gave their best to Biesterfeld, as well as to our customers and suppliers.”

The first quarter of 2021 was also successful across the group, Biesterfeld says. Generally high demand for raw materials on a global level and the shortage of resources in a number of markets – particularly plastics and rubbers – contributed to revenues and earnings. www.biesterfeld.com BUILDING FOR BODO

Bodo Möller Chemie is expanding its presence in the Iberian peninsula, following on from the opening of the Bodo Moeller Chemie Spain office in Madrid this past December. “There is demand in the markets of Spain and Portugal, above all for polyurethane-based products used in the CASE industry,” says Vincent Muller, managing director of the new unit. “The enormous professional expertise regarding the

use and selection of the right materials plus the precise and dependable logistics network of Bodo Möller Chemie give local customers a lot of security.”

Frank Haug, chairman of the board, explains further: “We are working very hard in the new locations throughout the world to steadily expand existing trade cooperations and be able to establish new partnerships. With the products and services that we sell and distribute, we are capable of opening up a new market in a very short time. In the Iberian Peninsula, we are opening up the interesting market of Spain and Portugal for us and our industrial partners such as Henkel and Merck.”

Bodo Möller Chemie has also expanded its relationships with Merck, recently being appointed to take over the distribution of Merck Surface Solutions’ portfolio for plastic, printing and coating applications in several European countries, building on a similar deal covering Scandinavia. The new arrangement covers Germany, Austria, Switzerland, Spain, Portugal, France and the Benelux countries.

“The further expanded collaboration with Merck as manufacturer of innovative products, especially here for effect pigments, pleases us a great deal. With it, we keep setting the course to become the complete know-how and product provider and can offer Distribution 2.0 to our customers,” says Florian Krückl, vice-president of global business management, CASE & Textile Effects, at the Bodo Möller Chemie Group. bm-chemie.com OMYA BAGS CANADIAN DEAL

Michelman, a global developer and producer of environmentally friendly materials for industry, has appointed Omya as exclusive distributor of its surface modifiers and wax emulsion products to the paints and coatings markets in Canada.

“We’ve partnered with Omya, partly due to their commitment to implementing sustainability throughout all areas of their

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company,” says Eric Vrabel, sales director at Michelman. “Our purpose is Innovating a Sustainable Future and Omya provides products from responsibly sourced materials to meet current and future generations’ needs.

Omya has the expertise to help customers excel in the diverse range of markets they serve with sustainable and responsible solutions.

Furthermore, this agreement will enable us to enhance our presence in this region.”

“Michelman’s products align with our industrial minerals and specialty chemicals distribution to effectively deliver customer solutions. Michelman is a leader in wax emulsion technology and together we look forward to success providing value to our customers,” says Mark Fungfook, Omya’s product manager, construction for the US and Canada. www.omya.com RECOGNITION FOR HALL

Hall Technologies has become an authorised distributor for Connecticut-based StanChem Polymers and will be making its products available across Hall’s core customers in the

southern states of the US from Colorado to Florida. StanChem specialises in R&D, manufacturing and marketing of emulsion polymers, adhesives and specialty coatings for a variety of applications.

“Their chemists and technicians have a strong focus on supporting customer’s technical needs through their R&D and analytical laboratories.

This makes them an exceptional supplier partner for Hall Technologies, who shares this focus,” Hall Technologies states.

In July, Hall Technologies successfully passed its three-yearly audit under the Responsible Distribution verification scheme, the National Association of Chemical Distributors’ (NACD) third-party programme through which its members can demonstrate their commitment to continuous performance improvement in every phase of chemical storage, handling, transport and disposal. The audit “required a large amount of time and commitment,” notes Jeff Laurent, president of Hall Technologies.

“We are grateful for the efforts of our operations group and for the guidance provided by NACD.” halltechinc.com

GOOD START FOR DKSH

DKSH has reported net sales of CFr 5.49bn for the first half of 2021, a 2.8 per cent increase over last year. Operating profit was up 18.1 per cent at CFr 131.5m.

“Despite pandemic-related uncertainties and the current restrictions in Asia Pacific, our EBIT and Free Cash Flow exceeded 2020 and 2019 levels thanks to our resilient business model and the disciplined execution of our strategy,” says CEO Stefan P Butz. “Visibility on the evolution of the pandemic remains limited, but we will continue to build a better company and expect a solid second half.”

Particularly strong performance came from DKSH’s Performance Materials business unit, where net sales were up by 18.2 per cent and operating profit by 39.2 per cent. “The main drivers were strong organic growth across all four Business Lines and most key markets as well as the expansion of the key client portfolio,” the company states. “The experienced DKSH team delivered high-quality services to clients and customers by overcoming challenges in distribution channels and supply shortages.” www.dksh.com

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46 COURSES & CONFERENCES

CONFERENCE DIARY The ongoing global Covid-19 pandemic has caused the cancellation or postponement of many events planned for the next few months and many organisers are taking their events online.

HCB is doing its best to keep on top of developments but readers should check the dates and locations shown below as things change rapidly.

SEPTEMBER International Transport & Logistics Week (SITL) SEPTEMBER 13-15, PARIS Annual transport event, including hybrid and inperson conferences and workshops www.sitl.eu/en-gb.html Labelmaster DG Symposium SEPTEMBER 13-24, VIRTUAL 16th annual Dangerous Goods Symposium hosted by Labelmaster’s DG Exchange www.dgexchange.com ChemUK 2021 SEPTEMBER 15-16, BIRMINGHAM Supply chain expo and conference for the UK chemical industry www.chemicalukexpo.com Hazardous Areas Conference SEPTEMBER 15-16, BRISBANE Eighth conference on operations and equipment in hazardous areas www.events.idc-online.com/upcomingconferences/hazardous-areas-conferencebrisbane-australia

FachPack 2021 SEPTEMBER 28-30, NUREMBERG Biennial exhibition on the packaging process chain www.fachpack.de/en

Oil & Gas Africa 2021 OCTOBER 7-9, NAIROBI Ninth annual exhibition for the upstream and processing sectors in east Africa www.expogr.com/kenyaoil/

DGAC Members Conference SEPTEMBER 29-30, VIRTUAL Annual conference of the Dangerous Goods Advisory Council www.dgac.org/dgac-meetings-0

Tank Truck Week OCTOBER 10-13, DALLAS NTTC’s Annual Tank Truck Show & Maintenance Seminar https://tanktruck.org/Public/Events/Tank-TruckWeek/Public/Events/Tank-Truck-Week.aspx

OCTOBER

IATA World Cargo Symposium OCTOBER 12-14, ISTANBUL 14th global conference on air cargo www.iata.org/events/wcs/pages/index.aspx

ILTA OCTOBER 4-6, HOUSTON 40th annual operating conference and trade show of the International Liquid Terminals Association www.ilta.org EPCA Annual Meeting OCTOBER 5-7, VIRTUAL 55th annual meeting of the European Petrochemical Association www.epca.eu

Gastech 2021 SEPTEMBER 21-23, DUBAI International conference and trade show for the LNG and LPG industries www.gastechevent.com

AFPM Security Conference OCTOBER 5-6, NEW ORLEANS Conference on security at fuel refining and petrochemical plants www.afpm.org/events/292d4a0000075d

Virginia Hazmat Conference SEPTEMBER 21-24, NEWPORT NEWS 38th annual networking and training meeting sponsored by the Virginia Association of Hazardous Materials Response Specialists www.virginiahazmat.org

Hazardex 2021 & PPTEx OCTOBER 6-7, HARROGATE Conference and exhibition on hazardous area operations and personal protective technology www.hazardex-event.co.uk

TSA Conference & Exhibition SEPTEMBER 23, COVENTRY 20th annual meeting of the UK Tank Storage Association www.tankstorage.org.uk/conference-exhibition/

ECTA Responsible Care Workshop OCTOBER 7, BRUSSELS Update on Responsible Care implementation in European chemical transport https://ecta.com/product/ecta-responsible-caretraining-workshop-2021/

Liquid Gas Europe Congress SEPTEMBER 28-30, ONLINE Europe’s biggest event for the regional and global LPG sectors www.liquidgaseurope.eu/lge-e-congress

Argus LPG Moscow 2021 OCTOBER 7-8, MOSCOW/VIRTUAL 15th annual event for the regional LPG sector www.argusmedia.com/en/conferences-eventslisting/cis-lpg-2021

HCB MONTHLY | SEPTEMBER 2021

LNGgc OCTOBER 12-14, LONDON/ONLINE 11th annual conference on LNG shipping and trade https://informaconnect.com/lnggc-london/ Pumps & Valves Asia OCTOBER 14-16, BANGKOK Exhibition for the ASEAN pumps, valves and fittings sector www.pumpsandvalves-asia.com AFPM IPC OCTOBER 17-19, SAN ANTONIO AFPM’s annual International Petrochemical Conference www.afpm.org/events/2926d800000001 IPANA Annual Conference OCTOBER 19-21, CHICAGO Annual meeting of the Industrial Packaging Alliance of North America www.industrialpackaging.org/#events ChemCon Europe 2021 OCTOBER 25-29, LONDON Conference on global chemical regulation chemcon.net/ Intermodal Europe OCTOBER 26-28, AMSTERDAM Annual trade show and conference for the container, transport and logistics industry www.intermodal-events.com

26-28 OCTOBER 2021 | RAI AMSTERDAM

YOUR PLATFORM IN EUROPE TO RECONNECT WITH THE CONTAINER INDUSTRY

Bringing together the Intermodal Industry

Organised by:

REGISTER NOW www.intermodal-events.com

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48

INCIDENT LOG ROAD/RAIL/AIR INCIDENTS Date

Location

2/6/21

8/6/21

Vehicle Type

Details

Source

Abuja, road tanker LPG Nigeria

Road tanker with “cooking gas” collided with car due to speeding; two people in tanker died in crash, four others in both vehicles badly hurt; trailer detached from cab, nearly fell off flyover; gas had to be transferred

Independ’t

Ellampillai, road tanker methanol Tamil Nadu, India

Road tanker with 30 t methanol from Kochi overturned late at night after driver lost control; fire crews sprayed foam onto wrecked vehicle to prevent fire; driver escaped unhurt; no report of leak

The Hindu

13/6/21 Asansol, road tanker oil W Bengal, India

Road tanker heading for Raniganj collided with truck carrying medicines from Kolkata; fire broke out after crash; at least three people in the two vehicles were trapped, burned to death

India TV

13/6/21 Burewala, road tanker — Punjab, Pakistan

Two people suffered serious burn injured when oil tanker ruptured during repair work, leading to fire; likely that tanker had not been properly cleaned before work started, though no indication of previous cargo

Urdu Point

14/6/21 Nalasopara, road tanker oil Maharashtra, India

Oil tanker heading for Ahmedabad crashed into container truck on Mumbai-Ahmedabad highway, bursting into flames; both drivers suffered burn injuries, tanker driver critically hurt; both vehicles destroyed in blaze

Times of India

14/6/21 Samarkand, road tanker LPG Uzbekistan

Gas tanker exploded during discharge of LPG at filling station; driver and employee of station killed in blast; cause under investigation

Xinhua

16/6/21 Idiroko, road tanker gasoline Ogun, Nigeria

At least seven people died after bus collided with road tanker at Ajilete on Idiroko expressway; bus said to be speeding, ran into rear of tanker with 33 m3 gasoline while climbing slippery hill; two others badly injured

Vanguard

17/6/21 Pohri, road tanker gasoline MP, India

Road tanker overturned due to speeding; driver was hurt in crash but locals ignored him and rushed to collect gasoline leaking from tanker; police attended but were unable to stop the looting

NDTV

17/6/21 Ikeja, road tanker LPG Lagos, Nigeria

At least nine people died after gas tanker exploded near hotel and shopping mall; gas leaking from tanker thought to have been ignited by fire in restaurant kitchen; severe damage to buildings, other vehicles

Business Day

18/6/21 Champagarh, road tanker acid Odisha, India

Road tanker with unspecified acid heading rom Brahmapur to Kolkata suffered leak while driving on NH16; fire crews arrived to contain leak; cause of leak unknown

Times of India

19/6/21 Vaijapur, road tanker diesel Maharashtra, India

Road tanker with 20 m3 diesel overturned on Aurangabad-Mumbai highway; driver, cleaner both escaped; locals arrived with drums and buckets to collect spilling fuel until police arrived four hours later

Times of India

19/6/21 Amuwo-Odofin, road tanker gasoline Lagos, Nigeria

Road tanker overturned in residential area, spilling contents and causing panic among locals, mindful of recent explosion in Ikeja; responders were on site quickly, averted fire

Daily Trust

20/6/21 Sidhi, road tanker gasoline MP, India

Road tanker overturned near NH 39 in Amdad village; tank was ruptured; locals arrived to collect spilling gasoline; police arrived but stood by and did not try to intervene; tanker was emptied before fire crews arrived

Zee News

22/6/21 Fiorenzuola d’Arda,road tanker LPG Piacenza, Italy

Road tanker with LPG, truck and private car were in rear-end collision on A1 between Piacenza and Fidenza; tanker exploded in fireball; both truck drivers killed but two people in car managed to escape

Italy24 News

22/6/21 Ogere, road tanker fuel Ogun, Nigeria

Road tanker caught fire on Lagos-Ibadan expressway, cause unknown; fire spread to other vehicles, was followed by explosion that destroyed six tankers, five trucks, two cars; only one injury reported

Business Day

22/6/21 Laurel, road tanker mineral oil Maryland, US

Tank truck collided with box truck on I-95; tanker overturned, spilling oil along side of road; both drivers injured in crash; six-mile tailback on highway during response

NBC

22/6/21 nr Vallejo, road tanker diesel California, US

Tank truck with 3,800 gal (14.4 m3) diesel overturned on Highway 37 near marshland; crews arrived to transfer load to another tanker; no pollution reported

CBS

24/6/21 Hancock, road tanker gasoline Michigan, US

Tank truck overturned on sharp bend on US-41, spilling unknown volume of gasoline, some reaching storm drain, which flows to Lake Superior; rest of cargo transferred, wreck righted; spill blanketed with foam

MLive

25/6/21 Ames, freight train LPG Iowa, US

27 cars of UP train derailed in downtown area of small town; some properties evacuated due to leak of LPG from some tank cars; no injuries reported; cause under investigation

STARS

2/7/21

nr Lacombe, freight train asphalt Alberta, Canada

23 cars of CP train derailed alongside Highway 2A; one was tank car with asphalt, which leaked some cargo; early report of fire was inaccurate; TSB on scene to investigate

CBC

4/7/21

Ibadan, road tanker LPG Oyo, Nigeria

Fully loaded gas tanker lost control and swerved into busy market, running over traders and crashing into stalls; several people killed, others injured; fire crews arrived promptly to prevent explosion

The Eagle

4/7/21

Ocean City, truck fireworks Maryland, US

Unintentional ignition of fireworks on back of truck ahead of Fourth of July display caused explosion that sent fireworks in all directions; several employees suffered minor injuries; safe zone prevented worse outcome

BNO News

HCB MONTHLY | SEPTEMBER 2021

Substance

SAFETY 49

MARINE/INLAND WATERWAY INCIDENTS Date

Location

Vessel

Substance

Details

Source

12/6/21 Manila, Titan 8 bunkers Philippines

Fire broke out on coaster refuelling at Delpan wharf in Tondo; fire was followed by at least one explosion; Philstar vessel capsized, sank alongside wharf; six crew of two ships hurt, two others missing; investigation underway Global

13/6/21 Port Sudan, King Marine 1 cattle feed Sudan

Fire broke out aboard ro-ro with cars and cattle feed from Qatar; reports suggest cattle feed was source of fire; blaze was brought under control, vessel towed to outer anchorage, reported to be badly damaged

FleetMon

16/6/21 Bay of Bengal Devon bunker fuel

Containership reported crack in port hull in way of fuel tanks, followed by oil leak put at 10 tonnes; vessel drifted while fuel was pumped to another tank before vessel was underway again en route Haldia

FleetMon

23/6/21 Barranquilla, Amber Bay asphalt Colombia

Product tanker (12,800 dwt, 2016), reportedly with full cargo of asphalt, grounded while leaving port; three tugs deployed to free vessel; no hull breaches or leaks reported

FleetMon

23/6/21 Kiel, Kirsten B pellets Germany

General cargo ship suffered fire in cargo of pellets as it approached Kiel Canal; diverted and berthed at Ostuferhafen where smouldering pellets were offloaded; firefighters monitored remaining cargo

FleetMon

23/6/21 Kingston, CFS Wind fuel oil Jamaica

Some 2 tonnes fuel oil leaked from containership to port waters; port authorities believe fuel leaked from tank on deck during bunkering; found 21 flexible tanks on deck, vulnerable to damage and leaks

FleetMon

26/6/21 Georgetown, Canada Club — Guyana Georgetown

Small tanker, said to be empty, exploded at wharf on Demerara River; three people onboard were killed; security guard reported smoke emanating from bow of vessel; Guyana Fire Service investigating

Kaieteur News

MISCELLANEOUS INCIDENTS Date

Location

Plant Type

Substance

Details

Source

11/6/21 Cilacap, oil refinery oil Java, Indonesia

Fire broke out in storage area at Pertamina refinery, cause unknown; fire was contained within bund walls; TV footage showed large fire, black smoke; supplies of fuel and LPG not interrupted

Reuters

12/6/21 Ahmedabad, ink factory solvents Gujarat, India

Massive fire broke out at Ink-Anon factory in Naroda area; three firemen injured by explosions in solvents storage area; fire crews managed to prevent fire from spreading to residential area; investigation underway

NDTV

13/6/21 Shiyan, pipeline (?) natural gas Hubei, China

At least 12 people killed, nearly 140 injured by huge gas explosion in Zhangwan district of Shiyan City; source of gas leak not clear; several buildings badly damaged; authorities investigating

CNN

14/6/21 Novosibirsk, Russia

filling LPG station

Fire broke out at Eurogas filling station, causing tanks to explode; fire spread to 800 m2; 35 people injured; video showed massive plume of flame; station manager detained, pending investigation of negligence

Moscow Times

14/6/21 Rockton, Illinois, US

chemical petroleum plant

Big explosion, massive fire at Chemtool plant, which makes industrial lubricants; widespread evacuation ordered; crews allowed fire to burn, fearing contamination of nearby river; CSB investigating

ABC

17/6/21 Vancouver Island, filling gasoline BC, Canada station

Camper van caught fire while filling up at Co-op station in Whiskey Creek; fire spread, prompting closure of roads to enable fire tenders to ferry water to the site, which burned for hours; not clear if there were injuries

CityNews 1130

17/6/21 Napier, port chemical New Zealand

Port halted terminal operations after leaking container was offloaded; responders found 18 IBCs, at least one of which had ruptured; area was cleared; product said to be flammable but not toxic

NZ Herald

18/6/21 Lugansk, pipeline natural gas Ukraine

Gas pipeline suffered explosion, fire in breakaway region of Donbas; more than 40 buildings were cut off from gas supplies; no reported casualties; authorities investigating cause

Tass

19/6/21 Moscow, warehouse fireworks Russia

Fire broke out in pyrotechnics warehouse on Luzhnetskaya Embankment, causing multiple explosions; fire spread to neighbouring building; cause of fire as yet unknown

Tass

19/6/21 Cacak, Serbia

Three workers injured by strong explosion at Sloboda plant, second such incident within a month; evacuation of nearby residents ordered; authorities to investigate both events

Reuters

21/6/21 nr Sivakasi, firecracker fireworks Tamil Nadu, India factory

At least three killed, two injured by explosion at illegal firecracker manufacturing factory in Thaiyilpatti; area is known as a fireworks manufacturing hub but safety standards are lacking at informal facilities

NDTV

28/6/21 nr Farmersville, pipeline natural gas Texas, US

Two people killed, three injured by explosion in line at Atmos Energy natural gas site; all those involved were contractors servicing the gas line; FBI invited to investigate

AP

30/6/21 Morris, factory Illinois, US

Fire broke out in Superior Battery facility, where up to 100 tonnes of lithium batteries were stored; 1,000 nearby homes evacuated; crews could not use water and had to allow the fire to burn out

CBS

ammunition ammunition plant

lithium batteries

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50

HEAT TREATMENT

temperature of the styrene monomer during the voyage, and therefore were not aware of the increasingly dangerous situation.”

INCIDENT REPORT • MAIB’S INVESTIGATION OF THE STOLT GROENLAND EXPLOSION HIGHLIGHTS THE NEED TO PROPERLY MONITOR INHIBITED CARGOES CARRIED IN BULK A FAILURE TO appreciate the extent of heat transfer between cargo tanks, together with a lack of temperature monitoring in cargo tanks with styrene monomer, were the main causes of the catastrophic loss of containment on the chemical tanker Stolt Groenland in the port of Ulsan, South Korea on 28 September 2019, according to the report of the investigation carried out by the UK Marine Accident Investigation Branch (MAIB).

above the jetty. Two crew suffered minor injuries and 15 emergency responders were injured during firefighting efforts that lasted for more than six hours.

MAIB determined that the polymerisation was initiated by elevated temperatures in the tank, caused by heat transfer from other chemical cargoes, reducing the effectiveness of the inhibitor added to the styrene.

“Athough the styrene monomer had not been

AS IT UNFOLDED At the time of the incident, while Stolt Groenland (43,500 dwt, built 2009) was moored at the jetty to unload cargo, the smaller chemical tanker Bow Dalian (9,150 dwt, 2012) was moored outboard to receive cargo by ship-to-ship transfer and was already receiving nitrogen from shoreside vehicles for purging its tanks. Stolt Groenland had loaded 20 different chemical cargoes from terminals in Texas, including four tanks of hexamethylenediamene (HMD) and two of diglyceryl ether of bisphenol-A, both of which required heating during the passage to Asia.

Four tanks had been discharged to barges while the tanker was anchored off Kobe; it

The immediate cause of the incident was not hard to establish: a runaway polymerisation in a cargo tank with styrene led to an overpressurisation of that tank, causing a rupture that allowed vapour to escape; this vapour found an ignition source, causing a fireball that reached the road bridge

stowed directly adjacent to heated cargo, the potential for heat transfer through intermediate tanks was not fully appreciated or assessed,” MAIB’s report says. “Critical temperature limits had been reached before the vessel berthed under the road bridge in Ulsan. The tanker’s crew did not monitor the

then proceeded to Ulsan where it discharged six tanks of adiponitrile at the Odfjell terminal before moving to the Yeompo Quay. There two tanks with Voranol were discharged to Stolt Voyager by ship-to-ship transfer.

The first sign of a problem arrived with a release of vapour from the pressure/vacuum

HCB MONTHLY | SEPTEMBER 2021

SAFETY 51

relief valve on a cargo tank with styrene; two minutes later the tank’s high-level alarm sounded, which was noticed by the crew.

While the crew were investigating, the high-high-level alarm sounded, indicating that the level of the tank had increased to 98 per cent. Within minutes, two explosions occurred in rapid succession in way of the vessel’s cargo manifold; the second of these ignited the styrene vapour released from the tank, causing the fireball. One crewman was blown over the guardrails.

The chief officer of Stolt Groenland activated the deck foam monitor system and directed the port monitor towards the cargo manifold; the master ordered all crew to the lifeboat station where they abandoned the tanker using the freefall lifeboat. Meanwhile, the chief oficer of Bow Dalian activated the deck foam fire extinguishing system, directing the monitors towards Stolt Groenland’s main deck and cargo manifolds. The crew abandoned ship by rope ladder onto Korea Coast Guard vessels that had arrived to assist.

MAIB investigators later found that there was a large hole in the main deck in way of the cargo tank that ruptured, and in its common bulkhead with the centre tank. There was fire damage in the manifold area and the midships deckhouse was burned out. There was also extensive internal fire damage in the accommodation block; heat and smoke had also got onto the bridge, damaging much of its equipment.

PRIOR EXPERIENCE MAIB was interested to note that another Stolt Tankers vessel, Stolt Focus (37,500 dwt, 2001) had experienced a similar polymerisation incident two weeks earlier, though without the dramatic outcome experienced by Stolt Groenland. Both ships had loaded the styrene,

 THE FIRE BURNED FOR SIX HOURS, BADLY AFFECTING THE DECK AND MIDSHIPS DECKHOUSE. HAD IT HAPPENED AT SEA, THE CONSEQUENCES FOR THE CREW WOULD HAVE BEEN DISASTROUS

“MAIB HAS MADE RECOMMENDATIONS TO IMO, CDI AND PLASTICS EUROPE TO AMEND THE

been caused by the inadvertent introduction of nitrogen into the tank. MAIB also notes a number of runaway polymerisation incidents involving styrene in land-based accidents, saying that, while the causes varied, insufficient temperature monitoring was a common contributing factor.

produced by Ineos Styrolutions, from the same tank at the LBC terminal in Houston; in both cases sufficient 4-tert-butylcatechol (TBC) inhibitor had been added to provide effective protection against polymerisation for between 60 and 90 days.

Stolt Focus had noted some increased temperature readings in its styrene tanks on arrival in Kobe; actions were taken to cool the cargo and contain the situation. Later, after further steady rises in temperature, it was decided to introduce sea water into the tanks to stop the reaction, although this increased viscosity, making the cargo unpumpable. It then proposed to dilute the cargo with benzine in international waters, also adding a shortstop inhibitor, phenothiazine, to stabilise the material and allow its discharge for incineration ashore.

MAIB asked Stolt Tankers for further information but, MAIB says, Stolt refused to provide it, as it did not consider the polymerisation aboard Stolt Focus as a marine accident or incident. MAIB was informed of

HOTTER THAN IT SHOULD BE MAIB focused on the temperature of the styrene cargo, noting that the loading of the material had been performed correctly and that the application of the inhibitor, the cleanliness of the cargo tank, sampling and stowage location (away from heated tanks) were all in order. Nevertheless, the styrene monomer carried in the tank that ruptured had been heated to levels well above ambient temperatures during the voyage, at times exceeding 37˚C. The styrene had been maintained at 13˚C in the shore tank in Houston; by the end of the loading process its temperature had risen to some 17˚C. At the time, the ambient temperature was about 30˚C, so cargoes loaded into tanks adjacent to the styrene would have been at or above that temperature and, MAIB says, it is likely that the temperature of the styrene would soon have reached a similar level, likely exceeding the 29.4˚C maximum specified on the certificate of inhibitor by the time the vessel departed Houston. Although this is unlikely to have been the single cause of the runaway polymerisation, the elevated temperature would have significantly increased the rate of TBC depletion and, therefore, the risk of polymerisation.

MAIB notes that the HMD cargoes were loaded at a temperature of 61˚C and maintained between 45˚C and 55˚C (despite a stated maximum carriage temperature of

another incident involving styrene monomer loaded in Houston, which was rejected on arrival in China as the cargo had a high concentration of polymer. During passage that cargo had also shown elevated temperatures but it had been cooled by running water on the deck. MAIB suspects that this reaction had

50˚C). Heat transfer to adjacent tanks raised their temperatures to between 40˚C and 44˚C. It also says that the relatively low specific heat capacity of adiponitrile and styrene would have allowed the transfer of heat from the HMD cargo in the 9P cargo tank into the adiponitrile in 9C and thence to the styrene in 9S, the tank

RELEVANT CODES AND STANDARDS ON THE BASIS OF LESSONS LEARNED”

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52

that ruptured in Ulsan.

Any rise in temperature has a measurable effect on the inhibitor, which was added at loading at 17 ppm. According to indicative depletion rates provided by Plastics Europe, that TBC concentration would have dropped to its lower recommended limit of 10 ppm after 77 days at a temperature of 25˚C; at 30˚C it would take only 49 days, which was less than the planned voyage of 56 days. At 40˚C it would take only 10.5 days to reach the limit.

MAIB tested samples from other styrene tanks on Stolt Groenland and found their TBC concentration to be between 7 and 8 ppm; it assumes that, as the temperature in 9S was at least 5˚C higher, its TBC concentration would have been substantially lower.

CONCLUSIONS AND RECOMMENDATIONS MAIB concludes that the explosion and fire, caused by a runaway polymerisation of the styrene monomer cargo in cargo tank 9S was initiated by the cargo’s elevated temperature for much of the voyage, resulting from the transfer of heat from the HMD cargo in tank 9P. It says that the precaution of not stowing the styrene cargo next to the heated HMD cargo was not sufficient to meet the segregation requirements in the International Code for the Construction and Equipment of Ships Carrying Dangerous Chemicals in Bulk

(IBC Code) and the probability of this heat transfer was not fully considered during the planning and approval of the cargo stowage.

Calculations to predict heat transfer were not conducted because they were complex and outside the capabilities of the ship operator and the vessel’s crew and also outside the scope of the cargo stowage software. While there were instructions on the stowage of inhibited cargoes, these did not cover in detail the possibility of heat transfer through adjacent or intermediate cargo tanks.

Further, despite it being a requirement in the ship’s Safety Management System (SMS), the temperature of the styrene cargo was not monitored and temperature alarms, although available, were not set. MAIB says the crew either did not notice or did not recognise the significance of elevated cargoes discharged prior to the event. The absence of temperature monitoring appeared to derive from the crew’s view that styrene is benign when inhibited, and that no previous problems had been experienced.

Although it did not contribute to the incident, the certificate of inhibitor contained

 THE EXPLOSION THREATENED NEARBY TRAFFIC AND INDUSTRIAL ACTIVITY

actions to be taken in the event of a rise in temperature that were not viable. The crew had no means of testing for TBC concentration or the presence of polymers and no additional TBC was carried onboard. MAIB also remarks that the operator missed an opportunity to alert its tanker masters to the similar incident aboard Stolt Focus two weeks before.

Since the incident, Stolt Tankers has embarked on efforts to raise awareness of the hazards posed by inhibited cargoes and amended its procedures and requirements to address some of the issues raised by the investigation. It has also begun work with manufacturers and industry bodies to ensure that cargo handling instructions and protocols for inhibited cargoes are practical and achievable. It looked at the use of polymer testing equipment for use onboard its ships but determined that this is not viable with current technology.

Responding to the MAIB report, Stolt Tankers says: “Stolt Tankers has used the learnings from this regrettable accident to improve its procedures for handling inhibited cargoes. During 2020, we made several improvements in our stowage planning processes afloat and ashore, and in our practices relating to inhibitors, managing cargo alarms and reporting of cargo temperatures to shore staff. Our seafarers also receive additional training to increase their understanding and awareness of the importance of these changes. The MAIB report acknowledges that these actions have already been taken.”

MAIB has meanwhile issued a series of recommendations to the International Maritime Organisation (IMO), the Chemical Distribution Institute (CDI) and Plastics Europe to amend their relevant codes and guidance to reflect the lessons learned from the incident.

Meanwhile, Stolt Groenland remains afloat in Tongyeong, South Korea, with all cargo residues removed. The company is planning for repairs as it awaits approval from local authorities to tow the ship to China.

The MAIB incident report can be downloaded in full at www.gov.uk/maibreports/cargo-tank-explosion-and-fire-onchemical-tanker-stolt-groenland.

HCB MONTHLY | SEPTEMBER 2021

SAFETY 53

WRECKS REMOVED

THE WORLD’S SALVAGE capacity is under threat after an alarming drop in the sector’s revenues last year. Gross revenue fell from $482m in 2019 to $301m in 2020 as the number of services provided by members of the International Salvage Union (ISU) dropped from 216 in 2019 to 182. Revenue through Lloyd’s Open Form (LOF) cases actually increased from $49m in 2019 to $60m.

“The 2020 ISU statistics show a 38 per cent fall in the income received by our members compared with the previous year,” notes ISU president Richard Janssen. “It is the dramatic fall in wreck removal income that stands out in these statistics - a 65 per cent drop. In recent years, wreck removal income has represented roughly 50 per cent of our members’ income but in 2020 it accounted for just under 33 per cent.

continue and we know that on an annual basis activity and income for our industry is variable.

The general trend towards a smaller number of larger and more complex cases enhances that annual variability,” Janssen adds. “There has also been some structural change in the industry in the last 18 months with the loss of a major player. That may have had an impact on these statistics but it is not possible to say for certain or to what extent.”

PAYING FOR SAFETY “What we can say with confidence is that ISU members have continued to provide vital services to shipowners and insurers,” Janssen continues. “And, taken alongside the ISU’s pollution prevention statistics, these numbers still demonstrate an active industry which year-in, year-out provides in the region of 200

to be a concern about the ongoing provision of salvage services globally and the long-term viability of the industry as it is today. ISU continues to actively engage with shipowners and insurers to ensure we are aligned with them on the future challenges they are likely to face.”

To be sure, the maritime industry will inevitably need the services of salvors in the future, as incidents continue to occur, unpredictably but repeatedly. To ensure that salvage capacity is available when needed – and when it is needed, it is needed quickly – salvors need to be fairly recompensed if they are to be able to have the necessary equipment on station around the world. That is why they appreciate the certainty offered by the LOF contract as well as the Special Compensation (Scopic) clause that confers additional recompense for activities involving the prevention of pollution.

Meanwhile, wreck removal has become an increasingly important source of income for ISU members, though last year the number of services provided fell by almost one half from the 2019 level, when 101 operations were conducted. Gross income dropped from $284m to just $98m in 2020, although the

“The economic pressures on our industry

services to vessels in trouble.

“Professional salvors protect the environment, reduce risk and mitigate loss.

They also keep trade moving - demonstrated so clearly in front of the world’s media with the refloating of the containership Ever Given in the Suez Canal this year. But there also has

timing of income is linked to contracts that may not be signed in the year work was carried out. Care has to be taken in interpreting those data, though it is clear that salvors’ fortunes are tied to an activity that provides precious little predictability. www.marine-salvage.com

SALVAGE • CONDUCTING MARINE SALVAGE IS NOT ONLY DANGEROUS FOR THE PEOPLE INVOLVED, IT IS ALSO FINANCIALLY PERILOUS – AND 2020 WAS NOT A GOOD YEAR FOR SALVORS

 SALVORS PLAY A VITAL ROLE IN THE SAFETY OF LIFE AND CARGO AT SEA BUT A SHARP DROP IN THEIR INCOME IS WORRYING MANY IN THE SECTOR

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54

NEXT STEPS

MULTIMODAL • THE JOINT MEETING AGREED A NUMBER OF CHANGES FOR THE 2023 EDITIONS OF RID, ADR AND ADN, THOUGH THESE REMAIN TO BE CONFIRMED BY THE MODAL BODIES THE JOINT MEETING of the RID Committee of Experts and the Working Party on the Transport of Dangerous Goods (WP15) of the UN Economic Commission for Europe held its spring session in Bern, Switzerland from 15 to 19 March 2021, in a hybrid format with both in-person and online attendance. The joint meeting’s main task is to ensure the maximum possible degree of harmonisation between the regulations that govern the transport of dangerous goods by rail (RID), road (ADR) and inland waterway (ADN) in Europe and, increasingly, elsewhere around

The spring session was chaired by Claude Pfauvadel (France) with Silvia Garcia Wolfrum (Spain) as vice-chair. It was attended by representatives of 25 countries (including the US), the European Commission, the EU Agency for Railways (ERA), the Organisation for Cooperation between Railways (OSJD) and 16 non-governmental organisations.

Following on from the reports of the Working Group on Tanks and the informal London Group on tank inspection, discussions of new standards and some outstanding items held over from the previous session (HCB

the globe. While it is charged also with aligning the modal regulations with the UN Model Regulations insofar as possible, it concentrates in particular on the rules for the design, construction, maintenance and inspection of the various means of containment.

July/August 2021, page 88), the Joint Meeting moved on to debate some new proposals.

HCB MONTHLY | SEPTEMBER 2021

PROPOSALS AND DECISIONS The first of these came from Germany and sought the inclusion of provisions for the carriage of molten aluminium (under UN 3257

for elevated temperature liquid, nos).

At present, according to special provision VC 3, the conditions of carriage are set by the competent authority of the country of origin and Germany felt it would be better to include some uniform minimum requirements. The proposal followed on from an incident in which molten aluminium leaked from a vat after the ventilation valve had been broken off; transport in such vats is not approved in Germany and this shipment had come from another country.

Germany supplied a proposal with general requirements, fire and explosion protection standards, and the construction, testing and inspection of vats. The Joint Meeting felt that this needed further investigation and decided to establish a new informal working group, with terms of reference supplied by Germany.

Germany also proposed to delete the requirement in 1.8.7.2.3 for technical documentation to be attached to the design type approval certificate, saying it is redundant as it is already annexed to the design type test report. Several delegations raised concerns and the proposal was withdrawn.

The secretariat came with a proposal based on the new entries for electronic detonators (UN 0511, 0512 and 0513) that had been

REGULATIONS 55

introduced in the 2021 editions of RID/ADR/ ADN. As security provisions had also been introduced, and noting that UN 0512 and 0513 are both assigned to Division 1.4 (1.4B and 1.4S, respectively), those provisions are now out of line with the security provisions for UN 0511 (Division 1.1B).

The Joint Meeting agreed with the secretariat’s argument and added “0511” after “0500” in the first indent of 1.1.3.6.2 (not for RID) and in the first sentence of 1.10.4.

The European Industrial Gases Association (EIGA) came with news of a successful resolution to the long-running efforts to achieve some level of mutual recognition of pressure receptacles between the US Hazardous Materials Regulations (HMR) and RID/ADR/ADN. In November 2020, the US Department of Transportation (DOT) had issued a final rule to allow “the import of filled pi-marked foreign pressure receptacles for storage incidental to movement, transport to point of use, discharge, and export” and also

 THE JOINT MEETING EXISTS TO ENSURE SEAMLESS OPERATIONS IN INTERMODAL TRANSPORT BUT HAS TO BALANCE THE DIFFERING REQUIREMENTS OF ROAD, RAIL AND INLAND WATERWAY SHIPPING

the transport of such pressure receptacles for export, including filling and storage incidental to movement. This change also applied to adsorbed gas packages.

EIGA offered a formal proposal to add into RID/ADR/ADN new provisions to mirror these changes, following their presentation in an informal document at the autumn 2020 Joint Meeting. Following some input from France and slight amendments, this was adopted, resulting in a new 1.1.4.7: Refillable pressure receptacles authorized by the United States of America Department of Transportation 1.1.4.7.1 Import of gases Refillable pressure receptacles authorised by the United States of America Department of Transportation and constructed and tested in accordance with standards listed in Part 178, Specifications for Packagings of Title 49, Transportation, of the Code of Federal Regulations accepted for carriage in a transport chain in accordance with 1.1.4.2 may be carried from the location of the temporary storage at the end point of the transport chain to the end user.

The consignor for the RID/ADR carriage shall include the following entry in the transport document: “CARRIAGE IN ACCORDANCE WITH 1.1.4.7.1”.

1.1.4.7.2 Export of gases and empty uncleaned

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pressure receptacles Refillable pressure receptacles authorised by the United States of America Department of Transportation and constructed in accordance with standards listed in Part 178, Specifications for Packagings of Title 49, Transportation, of the Code of Federal Regulations may be filled and carried only for the purpose of exporting to countries which are not RID Contracting States/ Contracting Parties of ADR provided the following provisions are met: (a) The filling of the pressure receptacle is in accordance with the relevant requirements of the Code of Federal Regulations of the United States of America. (b) The pressure receptacles shall be marked and labelled in accordance with Chapter 5.2 of



intermediate carriage operations. (d) The consignor for the RID/ADR carriage shall include the following entry in the transport document: “CARRIAGE IN ACCORDANCE WITH 1.1.4.7.2” No transitional provision is needed as the existing multilateral agreement M318 (under ADR) is valid until mid-2023.

Still on the subject of pressure receptacles, Germany proposed a change to 6.2.3.1.5,

“pressure relief devices”.

There was general support for the idea among the Joint Meeting but in the end it was felt better to keep the reference to fusible plugs but to add “or any other pressure relief devices” immediately after.

The European Association of Dangerous Goods Safety Advisers (EASA) sought a change to the first sentence of 7.4.1 (7.4 in RID), finding it confusing as it stands. This paragraph only concerns ADR/RID tanks for transport by land and not UN portable tanks; however, the reference to “a code” being shown in column (10) or (12) of the Dangerous Goods List is misleading, as column (10) is titled “instructions” and only column (12) has the word “code”.

RID/ADR. (c) The provisions of 4.1.6.12 and 4.1.6.13 shall apply to pressure receptacles. Pressure receptacles shall not be filled after they become due for periodic inspection but may be carried after the expiry of the time-limit for purposes of performing inspection, including the

which includes a prohibition on the fitting of fusible plugs to non-UN acetylene cylinders; this was based on a German proposal in 2014.

Since then, alternative pressure relief devices have come onto the market and need to be recognised. The German proposal suggested replacing “fusible plugs” in 6.2.3.1.5 with

The Joint Meeting agreed that clarification would be worthwhile and adopted a revised text for that paragraph: Dangerous goods may only be carried in tanks when a portable tank instruction is shown in column (10) or when a tank code is shown in column (12) of Table A of Chapter 3.2, or when a

HCB MONTHLY | SEPTEMBER 2021

AFTER MUCH DISCUSSION, THE ISSUE OF THE TRANSPORT OF PRESSURE RECEPTACLES BETWEEN EUROPE AND THE US IS CLOSE TO BEING SETTLED

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competent authority has issued an authorisation in accordance with the conditions specified in 6.7.1.3.

The European Council of the Paint, Printing Ink, and Artist’s Colours Industry (CEPE) reported on an impending difficulty for its members. There has, it said, been a consistent move away from solvent-based paints and inks to water-borne versions, reducing the volume of volatile organic compounds released to the environment.

Water-borne paints normally contain a biocide to protect against spoilage. The 15th ATP to the EU Regulation on the Classification, Labelling and Packaging of Chemicals (CLP) includes a change in classification that will result in many such paints meeting the classification criteria for UN 3082, packing group III. That ATP applies from 1 March 2022, meaning that those products will then fall within the scope of the packaging requirements for dangerous goods.

UN-approved packaging suitable for these paints and inks in quantities above 5 litres is not yet available for all product types, as there has not yet been a widespread demand for such packagings. The current timeframe to make the changes to classification and source suitable approved packagings is, CEPE said, insufficient. It sought a transitional measure applicable to products carried in packagings

of 30 litres or less.

The Joint Meeting was concerned that the adoption of any transitional provision should have to focus on paints and inks specifically, rather than to all UN 3082 material. It was also felt that the matter could be dealt with more simply by means of a multilateral agreement. Delegates were invited to send written comments to CEPE, which will prepare a revised proposal for discussion at the next session.

At the spring 2019 session of the Joint Meeting, the Netherlands had queried the need for the container/vehicle packing certificate to be provided along with the transport document, as it only applies when the carriage in question precedes a voyage by sea. While the certificate is required under the International Maritime Dangerous Goods (IMDG) Code, the fact that it is not necessary when a voyage by sea is not involved indicates that it cannot be considered as a measure to improve safety during transport by road or rail. The Joint Meeting had agreed in principle and the Netherlands promised to return with a formal proposal, which it now did.

After some discussion and amendment of the proposal, the Joint Meeting agreed some changes. In the first sub-paragraph of 5.4.2, the requirement that a container/vehicle packing certificate “shall be provided with the

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transport document” is changed to “shall be provided to the maritime carrier by those responsible for packing the container”. In the second paragraph of 5.4.2, “; if not, these documents shall be attached” is replaced by “(see for example 5.4.5)”. The Note after that second sub-paragraph is deleted. In the third sub-paragraph, “also” is inserted after “may”.

In 8.1.2.1(a) (for ADR) and (b) (for ADN), the words “and, when appropriate, the container/ vehicle packing certificate prescribed in 5.4.2” are deleted.

The International Road Transport Union (IRU) provided its thoughts on possible terms of reference for a new informal working group



on e-learning, as had been earlier agreed. The Joint Meeting agreed on the importance of considering the possibility of e-learning under the circumstances of the pandemic measures and to develop appropriate guidelines but there were some comments on IRU’s proposals. Interested delegates were invited

since the adoption of a change to the proper shipping name for UN 1010 Butadienes and hydrocarbon mixture, stabilised, for harmonisation with the UN Model Regulations. This specifies a mixture containing more than 40 per cent butadienes; however, in practice European producers

HCB MONTHLY | SEPTEMBER 2021

HAZARDOUS WASTE SHIPPERS HAVE A NUMBER OF PROBLEMS TO CONTEND WITH WHEN TRYING TO COMPLY WITH THE REGULATIONS, NOT LEAST CALCULATING EXACTLY HOW MUCH WASTE THERE IS

to notify their interest in participating in the informal working group to IRU, which will organise a kick-off meeting that could further develop the draft terms of reference for final adoption at the next session of the Joint Meeting.

The European Chemical Industry Council (Cefic) raised a problem that has emerged

supply such mixtures with a percentage of at least 20 per cent butadienes and in about half of all cases less than 40 per cent; the remainder can have concentrations of up to 45 per cent. This means that, for each shipment – and even for each package (truckload, rail tank car, tank container), the shipper has to determine whether the percentage of butadiene is more or less than 40 per cent. If it lower than 40 per cent, then UN 1010 cannot be used and a different entry – most likely UN 3161 or 1965 – used instead.

Cefic noted that this involves no difference in transport conditions, so from a technical point of view, the selection of the UN number has no impact. On the other hand, neither UN 3161 not 1965 provide information to emergency responders of the presence of butadiene and its carcinogenic hazard. Nor do they have a description that accommodates the word ‘stabilised’. As such, UN 1010 best reflects the hazards of butadiene mixtures

REGULATIONS 59

and the apparent arbitrary cut-off of 40 per cent introduces both a clouding of hazard communication and a complication for IT systems.

In its informal document, Cefic sought the reinstatement of the previous proper shipping name as an alternative for UN 1010 and a multilateral agreement to make it possible to use this entry. The Joint Meeting could not for now support the first part of this proposal but recommended that Cefic help in preparing a multilateral agreement for discussion at future sessions of WP15 and the Joint Meeting. It also recommended that Cefic submit a new proposal to the UN TDG Sub-committee.

The European Federation of Waste Management and Environmental Services (FEAD) provided the Joint Meeting with a report on the informal working group on the transport of hazardous waste, which inter alia had been charged with looking at the requirements for the quantity of transported in the transport document and had met twice, each time reporting back to the Joint Meeting.

The problem it is seeking to address is that, for practical reasons, it is sometimes not feasible to provide the exact quantity of waste being transported and there should be a certain degree of tolerance. FEAD’s paper offered a solution, which was adopted as a new 5.4.1.1.3.2 (the current 5.4.1.1.3 becoming 5.4.1.1.3.1): If there is no possibility to measure the exact quantity of the waste at the place of loading, the quantity according to 5.4.1.1.1 (f) may be estimated for the following cases under the following conditions: (a) For packagings, a list of packagings including the type and the nominal volume will be added to the transport document; (b) for containers, the estimation will be based on their nominal volume and other available information (e.g. type of waste, average density, degree of filling);

essential (e.g. 1.1.3.6); - Waste containing substances mentioned in 2.1.3.5.3 and/or substances of Class 4.3; - Tanks other than vacuum operated waste tanks.

[A statement shall be included in the transport document, as follows: “QUANTITY ESTIMATED IN ACCORDANCE WITH 5.4.1.1.3.2”.]

The final part, agreed during debate, is left in square brackets pending further discussion at the next meeting.

(c) for vacuum operated waste tanks, the estimation shall be justified (e.g. by means of an estimation provided by the consigner or by wagon/vehicle equipment).

Such estimation of the quantity is not allowed for: - Exemptions for which the exact quantity is

The Joint Meeting was informed that the London informal working group on tank inspection would meet again virtually on 8 and 9 June 2021 to resume discussion on remaining open issues. The Joint Meeting’s autumn session is due to take place in Geneva from 21 September to 1 October 2021.

OTHER BUSINESS The European Recycling Industries’ Confederation (EuRIC) had applied for consultative status at the previous session, which was now provided, allowing EuRIC to participate in the Joint Meeting from the autumn 2021 session.

France and Germany informed the Joint Meeting of the current status of the working group on telematics for the transport of dangerous goods and the ongoing activities within the EU on the implementation process of Regulation (EU) 2020/1056 on electronic Freight Transport Information (eFTI).

The Joint Meeting agreed the need to adapt on a biannual basis the data model for the transport of dangerous goods and to use in this respect the existing structure of the Ad hoc Working Group on Harmonisation, which was due to hold its next session immediately after the Joint Meeting.

It was noted that the future data model would most probably consist of a first part containing more general data and a second part covering the data for the transport of dangerous goods. It was also noted that the maintenance of that second part would be facilitated by referencing the dangerous goods data model. The EU updated the Joint Meeting on the more recent coordination activities on the cooperation with Member States and relevant stakeholders.

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MEET THE STANDARDS STORAGE TANKS • THERE ARE THOUSANDS OF STORAGE TANKS IN TEXAS; ITS SENATE HAS DECIDED IT IS HIGH TIME THERE WERE SOME CLEAR RULES AND SAFETY STANDARDS IN PLACE

immense number of storage tanks at processing plants and storage terminals, such a programme seems to be long-overdue.

Furthermore, it is an illustration of the seriousness with which the authorities are taking the rule that TCEQ has been provided with funding for 50 additional personnel specifically for the programme.

THE GOVERNOR OF Texas signed into effect the bipartisan Texas Senate Bill 900 (SB 900) this past 8 June and it went into effect on 1 September. The Bill directs the Texas Commission on Environmental Quality (TCEQ) to establish a programme to set and monitor standards for bulk storage tanks and, as it amends parts of the Water Code, to create and enforce safety requirements to protect ground and surface water, mitigate potential safety hazards and minimise catastrophic incidents in the event of an accident or natural disaster.

SB 900 was developed in the wake of the

burned for a week, producing harmful air pollution, ground and surface water contamination and millions of gallons of hazardous waste; it also led to a temporary closure of the Houston Ship Channel and was investigated by the Chemical Safety Board (CSB). Industry is now widely referring to SB 900 as the ‘ITC rule’.

The Bill’s sponsors stated: “The ITC fire and several additional fires at similar facilities underscore the insufficiency of state safety measures. This incident in particular highlights the existing regulatory scheme’s

INSPECT AND VERIFY On closer inspection, the impact on tank operators ought to be limited. The rule will require compliance with industry best practice and established standards, a level of safety oversight that all operators should already be achieving. These include, for example, API 650 and 653 and NFPA 30. The rule will in effect provide TCEQ with the jurisdiction to investigate those rules and standards that already apply. There will, though, certainly be an additional burden on tank operators in terms of reporting, inspections, certifications and fees. The level of those fees will be set at

March 2019 fire at the Intercontinental Terminals (ITC) terminal in Deer Park that

failure to protect public health and safety, ground and surface water, and the environment. Currently, the state lacks a comprehensive program to oversee these complex facilities.”

Given the extent of the oil and chemical industry in the state of Texas and the

an amount sufficient to cover the reasonable costs of the programme.

TCEQ is charged with publishing its initial rule under the Bill by 1 September 2023 and industry will have until 1 September 2027 to meet its requirements, register with TCEQ and report to TCEQ its current compliance status

 THE MARCH 2019 FIRE AT THE ITC TERMINAL IN DEER PARK HAS GENERATED A LOT OF TALK AND PAPER, WITH A LOT MORE PAPERWORK TO COME FOR OPERATORS

HCB MONTHLY | SEPTEMBER 2021

REGULATIONS

for existing tanks. Any new tanks entering service after that date must be registered within 30 days of starting operations.

Owners or operators of storage tanks must comply with the programme’s requirements on completion of the next regularly scheduled out-of-service maintenance of each tank and must certify compliance status no later than 1 September 2037. Any modifications or retrofits necessary for compliance with the programme should be made during these out-of-service maintenance periods. The compliance status will need to be re-certified every ten years thereafter. TCEQ will conduct on-site inspections of all facilities at least every five years to determine compliance.

WHAT’S IN, WHAT’S OUT The amendments to the Water Code created by the Bill are very specific about the scope of the programme. It applies to aboveground tanks with a capacity of 21,000 gal (80 m3) or more, used to store ‘a regulated substance’ (as already defined), and located at or part of a

petrochemical plant, petroleum refinery or bulk storage terminal (which includes end-of-line pipeline terminals).

Significantly, the programme covers only atmospheric tanks; in addition, crude oil and natural gas gathering tanks, heated tanks and those used for the storage of wastewater are not in scope. The programme also excludes tanks that are already regulated under federal rules, including the Surface Mining Control and Reclamation Act, the Federal Food, Drug and Cosmetic Act, or Pipeline and Hazardous

61

Materials Safety Administration (PHMSA) provisions.

Conversely, TCEQ is charged establishing its performance standards for safety with reference to other federal statutes and regulations, including the Clean Air Act’s Risk Management Plan rule; the Resource Conservation and Recovery Act’s requirements for treatment, storage and disposal facilities; the Spill Prevention, Control and Countermeasure Regulations; and the Environmental Protection Agency’s (EPA) Risk Management Plan rules.

Among other things, this will place a clear regulatory requirement, enforceable by TCEQ, for tank owners and operators to have in place spill control plans, overfill protection devices and, for low-flash products, fire suppression systems. Again, these should already be in place but TCEQ will now have a clear jurisdiction to inspect for compliance.

The full text of the Bill can be found at https://legiscan.com/TX/text/SB900/ id/2406365.

62

(LQ); any documentation for the load must merely include the words “contains dangerous goods packed in limited quantities”.

ADG 7.7 inserts a requirement that the consignor must advise the prime transport contractor, in a form that is readily accessible during transport, of the gross mass of LQ in the consignment or, if the LQ includes more than 2,000 kg/l of any single UN number, the UN number, proper shipping name and aggregate quantity for that UN number. The placard threshold is 8 tonnes gross mass, or if the LQ includes more than 2,000 kg/l of any single UN number. New placarding rules apply where the load includes both LQ and fully regulated dangerous goods.

As a result of the adoption of the international system, ADG 7.7 no longer includes the particular provisions for ‘mixed packet’ (lower risk) dangerous goods, personal care products or concessional limited quantities.

AUSSIE RULES AUSTRALIA • ADG 7.7 TAKES EFFECT NEXT MONTH AND PROMISES TO MAKE LIFE A LOT EASIER FOR THOSE SHIPPING DANGEROUS GOODS TO AND FROM AUSTRALIA THE LATEST REVISION to the Australian Code for the Transport of Dangerous Goods by Road and Rail (ADG), edition 7.7, comes into full effect on 1 October, one year after it entered into force. While the ADG Code is the responsibility of the National Transport Commission (NTC), it has to be enacted in law by each of the country’s states and territories.

ADG 7.7 is an important update; not only does it bring in a raft of amendments from the 21st revised edition of the UN Model

proposition in terms of compliance.

ADG 7.7 also includes a lot of housekeeping changes, with updates to contact details and external references, the removal of outdated references, editorial and technical corrections and an improvement in the layout. The adoption of some changes from the UN have also necessitated consequential amendments at various points throughout the text.

Regulations, it also includes some significant changes that remove Australia-specific provisions and align ADG more closely with the international provisions, as reflected in the modal rulebooks. This will remove some awkward differences that have made trade in dangerous goods with Australia a difficult

One of the most significant changes is in the way ADG addresses dangerous goods in small quantities. The provisions have been much simplified and are now generally in line with international regulations. For instance, a transport document is no longer required for dangerous goods packed in limited quantities

HCB MONTHLY | SEPTEMBER 2021

LIMITED QUANTITIES

PACKAGING AND TANKS Another alignment is found in 6.1.4.21, where the additional requirements for inner packagings filled in Australia have been removed. It should be noted, though, that all inner packagings, regardless of the location of filling, are required to meet UN performance tests and specifications and must be manufactured under a quality assurance programme. As a consequence, the provisions for the marking of inner packagings in 6.1.3.13 have been deleted.

Section 7.2.6 has been deleted completely; this dealt with the transport of nominally empty packagings. Instead, all packagings and receptacles that have contained dangerous goods and are not “free from dangerous goods” must be treated as if they still contain dangerous goods. In 4.1.1.11, it is noted that all empty packagings, including intermediate bulk containers (IBCs) and large packagings, that have contained a dangerous substance, must be treated in the same

 ADG 7.7 BRINGS AUSTRALIA CLOSER INTO LINE WITH INTERNATIONAL PROVISIONS

REGULATIONS 63

manner as a filled packaging, “unless adequate measures have been taken to nullify any hazard”. Similar provisions apply to portable tanks and multiple-element gas containers (in Chapter 4.2) and bulk containers (in Chapter 4.3). Marking, labelling and placarding provisions still apply, except for goods of Class 7.

The scope of 5.3.8.1 on the placarding of

intermodal loads is expanded to include tanks and containers that are imported into Australia, emptied and then returned while still containing residues.

In addition, there is a new provision that ‘empty means of containment’ – which includes all types of packagings, containers and tanks – that contain residue of dangerous goods (other than Class 7) must be described

on the transport document with the words “EMPTY UNCLEANED” or “RESIDUE LAST CONTAINED” before or after the dangerous goods description.

Section 7.2.5, which deals with empty and as yet unused pre-labelled packagings, has also been deleted. Instead, a new clause has been inserted in 5.1.3.3 to note that such packagings should be clearly identified as such on any transport documentation, outer packaging or the exterior of the cargo transport unit. This is to avoid inappropriate emergency response. Another reminder of that is included at 11.1.1.4.3(b). Indeed, Chapter 11.1 has been largely restructured, with several clauses removed to provide a better flow of information and to align with Chapter 5.4 of the UN Model Regulations.

More information on the ADG Code and the latest update can be found on the National Transport Commission’s (NTC) website, www.ntc.gov.au.

64 BACK PAGE

NOT OTHERWISE SPECIFIED WHITE LINES In these security-conscious times, when we read a headline like “Six injured in blast near Bengaluru airport”, we immediately think it must be some sort of terrorist incident. But the headline, which appeared in the Orissa Post in early June, was explained in more mundane terms by the story that followed.

It emerged that the six people hurt were working on a road marking machine, painting a pedestrian crossing and other signage on the road near an underpass at Terminal 2 of the Kempegowda International Airport.

Although the details have not been confirmed, it seems that a substantial amount of vapour from the heated paint on the machine had been released, gathering in the underpass and reaching its explosive limit. There were plenty of potential ignition sources that could have been responsible for the subsequent blast and a fire in the underpass that took two hours to put out.

provided at many parties and festivals in rural Cambodia, is home-made and much cheaper than commercially produced alternatives.

There is, though, little regulation of informal brewers and it seems that on this occasion the rice wine contained methanol.

Cambodia’s health ministry has since stepped up its campaign against contaminated beverages and at least 15 informal brewers and sellers have been arrested.

DRINK CHEAP, DRINK ONCE Less suspicious – though worse for those involved – was news from Cambodia in July, where eleven villagers died at a funeral (which will at least have saved on the transport costs). It is suspected that the deceased succumbed to toxic rice wine during the wake, which would not be unusual in the country – the New Straits Times reported that more than 30 people had died in three incidents involving

LET’S GO FOR A RIDE Also feeling the cold hand of law enforcement on her collar was a 44-year-old woman from New Jersey, who was arrested after stealing a Taylor Oil tank truck in Bellmawr, NJ at the end of July. That she took off on a joyride in the stolen truck was bad enough, but it took police eight hours to catch her, some 80 miles (130 km) away in Wildwood.

Along the way, the tanker was involved in “several motor vehicle accidents in several different jurisdictions,” police said. Several law enforcement agencies had engaged in various pursuits of the tanker through the day but most of these had had to be broken off in the name of public safety.

The joyride came to a dramatic end at a fuel station in Wildwood, where the perpetrator was filling up with diesel. Workers at the site called police, citing an “erratic driver”. When the cops arrived, she locked herself in the cab and refused to come out. It looked like she

home-brewed rice wine in the previous two months alone.

The eleven who died, along with another ten who were hospitalised, had drunk the rice wine at a funeral in Kampot province. A police officer said that they all suffered dizziness after drinking the wine which, like that

wanted to get back on the road but could not get the truck started, at which point, fearing this might be their only chance, officers forced the cab door open and pulled her out. She is facing several charges but, once released, might be able to get a job, given the shortage of truck drivers in the US.

HCB MONTHLY | SEPTEMBER 2021

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