BC Shipping News - February 2013

INSIDE: THE YEAR AHEAD FOR SHIPPING

BC SHIPPING NEWS

Volume 3 Issue 1

www.bcshippingnews.com

February 2013

Commercial Marine News for Canada’s West Coast.

Coal Terminals

The wild and wacky world of coal exports

Industry Insight

Mark Gordienko, President, ILWU Canada ILWU Canada: Backbone of the waterfront

Maritime Labour

The MLC: Persistence, policy significance and Port State Control

Containers

Trends in the container ship leasing industry

Plus:

Pipeline wars: Who speaks for shipping?

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February 2013

Volume 3 Issue 1

On the cover and below: The CSK Brilliance at Westshore Terminals.

Photos courtesy of Ray Dykes, PR Plus.

Contents

Cover Story 26

The wild and wacky world of coal exports by Ray Dykes

10 Industry insight ILWU Canada: Backbone of the waterfront For Mark Gordienko, President of ILWU Canada, the responsibility of representing over 3,000 longshoremen and marine industry workers is not one taken lightly.

22 Maritime labour

The Maritime Labour Convention

Persistence, policy significance and Port State Control by Darryl Anderson The MLC, 2006 is coming into force in August 2013. Anderson gives us a primer of what to expect.

Yachts

49

Meander...80 years a lady!

by Robert G. Allan, P.Eng

In the annals of Robert Allan Ltd., there is no vessel more significant that Meander.

D E P A R T M E N T S

F E A T U R E S

Mark Gordienko

6

News briefs / industry traffic

18

History lesson

20

Maritime family profile

30

Shipping forecast

35

Passenger vessels

38

Legal affairs

40

Pipeline projects

43

Containers

46

Environment

Letters to the editor and news

Labour at sea: The St. Roch and her crew — by Lisa Glandt Familiar name runs through 70-plus years of B.C. maritime history The year ahead for shipping — by Captain Stephen Brown Passenger ship safety since 1912 — by Nigel S. Greenwood It is insured for “all risks”...mostly — by W. Gary Wharton Pipeline wars: Who speaks for shipping? — by Michael Davis Trends in the container ship leasing industry — by Syd Heal Green Marine prepares to launch West Coast advisory committee — by Julie Gedeon February 2013 BC Shipping News 3

February 2013 Volume 3/Issue 1 Publisher McIvor Communications Inc. President & Editor Jane McIvor

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Contributing Writers Robert G. Allan, P.Eng Darryl Anderson Captain Stephen Brown Michael Davis Ray Dykes Julie Gedeon Lisa Glandt Mark Gordienko Nigel S. Greenwood Syd Heal W. Gary Wharton Advertising and Subscriptions Jane McIvor Phone: 604-893-8800 / Email: jane@bcshippingnews.com

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Subscribe online at www.bcshippingnews.com Contents copyrighted 2013 McIvor Communications Inc. 300 - 1275 West 6th Avenue, Vancouver, British Columbia Canada V6H 1A6 Phone: 604-893-8800/Fax: 604-708-1920 E-mail: contact@bcshippingnews.com

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International Standard Serial Number ISSN: 1925-4865 Published 10 times per year.

The opinions expressed by contributing writers are not necessarily those of the Publisher. No part of this magazine may be reproduced in any form without written permission of the publisher.

Photos by Dave Roels, www.daveroels.com

EDITOR’S NOTE

You’re in for a treat

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While I’m always impressed by the calibre of writing from our contributing writers, this month’s batch of articles surpasses even my expectations.

W

hile I’m always impressed by the calibre of writing from our contributing writers, this month’s batch of articles surpasses even my expectations.

First, BC Shipping News is pleased to welcome Nigel Greenwood, Michael Davis and Robert Allan to our growing roster of contributors. Nigel, retired Rear-Admiral of the Royal Canadian Navy and past Commander of Maritime Forces Pacific, is a brilliant wordsmith. His article on passenger ship safety since 1912 is the first of a series to prime BCSN readers for the Nautical Institute BC Branch’s upcoming conference (May 9/10 in Victoria) and I am eagerly looking forward to Member of:

reading more articles as we lead up to the event.

Michael Davis, Managing Director, Reputations, is no less of a wordsmith and his edgy take on “Pipeline wars: Who speaks for shipping?” will likely provoke discussion among industry leaders.

Robert Allan’s article on “Meander....80 years a lady!” is a testament to days gone by when you could build a luxury yacht for about $24,000 (and pay the designer of said yacht about $400!).

But there’s more. In what is becoming a tradition for our first issue of the year, Captain Stephen Brown gives his take on the subjects that will pre-occupy the industry in 2013 — and there are many

so I strongly recommend you pay close attention to Stephen’s article.

Our regular contributors, Darryl Anderson, Syd Heal and Ray Dykes have outdone themselves as well. Each has submitted articles that will inform and entertain you.

And, one last note — I’m extremely pleased to welcome Dave Roels to the BCSN fold. Dave has agreed to provide online galleries for readers to see industry sectors in action. Our first collaboration, in conjunction with this month’s Industry Insight with ILWU Canada, takes us to Neptune Terminals for a day in the life of a longshoreman.

It’s going to be a great year!

— Jane McIvor

Local traffic...

Thanks to Don Brown for submitting this photo of the New Orleans Express downbound on the Fraser River from the south end of No.6 Road in Richmond. The New Orleans Express is a UK-flagged container ship built in 1989 (by Daewoo Shipbuilding, Korea), owned by Hapag-Lloyd and classified by ABS. The vessel is 240 metres in length with a 32-metre beam, gross tonnage of 35,958 and 3,032 TEU. She can reach a speed of 9.1 knots (average: 7.5 knots).

(Details from www.marinetraffic.com and www.shipspotting.com.)

International Sailor’s Society Canada

Got a great photo? Send it to jane@bcshippingnews.com to be included in our new feature on ships visiting our local waters.

February 2013 BC Shipping News 5

LETTERS TO THE EDITOR Greetings Jane, I always look forward with great pleasure to getting BC Shipping, you’ve done a fabulous job!!!

But today I write with a clarification!!! Phil Oldham, in his article on Pleasure Craft Surveying, states that “...anyone can build a boat for pleasure with almost no requirements for construction or systems installations.”

This is not quite true. Transport Canada has “Construction Standards for Small Vessels”, publication number TP1332, available on the TC web site. These are mandatory Standards for all pleasure boats and small non-pleasure up to 15 tons. They set the minimum safety requirements for powering, floatation and capacity for boats less than six metres as well as safe electrical, ventilation and fuel systems. Other essential safety items are also covered.

These have been in place in one form or another since the early 1970s.

This Standard almost entirely mirrors the USCG’s Code of Federal Regulations for pleasure craft. Both

provide limits on persons and power and require flotation for all boats under six metres. All boats have a common numbering system and are required, in a non-specific manner to be structurally adequate. Interestingly, there are no requirements for construction or stability for vessels greater than six metres in either the CFR’s or TP 1332 or the ABYC Standards, for pleasure vessels. These only show up in European Certification, which is mandatory for all boats sold in the EU. Most Canadian and U.S. builders build for all three markets and so the boats are in fact well covered by mandatory requirements.

On a voluntary basis, the National Marine Manufacturers Association has a Boat and Yacht Certification Program which utilizes 49 ABYC Standards.

A builder’s model line is inspected each year for compliance. Look for the “NMMA Certified” decal on new boats!

Happy boating in 2013!!

Michael L. Vollmer, P.Eng, Michael Vollmer Yacht Design Inc., Burlington, ON

Something to say? Send a letter to jane@bcshippingnews.com.

BCSN

Dear Sirs, The most recent copy of your publication arrived by mail yesterday. I was pleased to see that some of the articles in it were on the subject of marine surveying.

I was disappointed however that your source material seemed to be based solely on information gained from the Association of Marine Surveyors of B.C. and some of its members.

I wish to draw your attention to the fact that there are other marine surveying associations represented by highly qualified surveyors in British Columbia. These include the National Association of Marine Surveyors and the International Institute of Marine Surveyors.

Perhaps, consideration could be given to including them in the event that you should publish a similar article in the future.

Yours truly, F.I. Hopkinson, Master Mariner, NAMS-CMS, MIIMS, MNI F.I. Hopkinson Marine Surveyors Ltd., North Vancouver, B.C.

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adio Holland Canada is now known as Imtech Marine Canada Inc.. RHC has been a part of Imtech Marine since 2006. With this new name, we conclude our integration of Radio Holland into the Imtech Marine family. Imtech Marine has an expansive global network, and we want to be easily recognized by our customers under the same brand name worldwide. Further, from now on, you will find Radio Holland’s Navigation & Communication expertise and Imtech Marine’s extensive knowledge of propulsion, electrical systems and automation represented under one name.

news briefs ClassNK issues world’s first Statement of Compliance for ship recycling facility to Jiangmen Zhongxin

C

lassNK announced that it has issued the world’s first Statement of Compliance (SOC) for a ship recycling facility to Jiangmen Zhongxin Shipbreaking & Steel Co., Ltd. The Statement of Compliance certifies that the facility and its recycling procedures are fully in compliance with the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, 2009 (Hong Kong Convention). This marks the first time that a ship recycling yard has achieved certification in line with the convention.

Established in 1984, Zhongxin has grown to become one of the largest ship recycling facilities in China, with a working yard occupying over 400,000 square metres and an annual ship-breaking capacity of over 500,000 LDT (light displacement tonnage). The yard has been a pioneer in green ship recycling, and earned recognition as

a “AAAA” level Green Shipbreaking Enterprise from the China National Ship Recycling Association (CNSA).

Green ship recycling has become an important issue in the maritime industry, especially following the adoption of the Hong Kong Convention. In addition to growing concerns about corporate social responsibility, new local and international regulations are helping drive the demand for high quality ship recycling facilities which can recycle vessels in an environmentally friendly and safe manner.

After a thorough review of the Ship Recycling Facility Plan (SRFP) developed by Zhongxin with the assistance of Wilhelmsen Ship Management, ClassNK, working as a third party certification body, confirmed that the recycling practices of the yard were in compliance with the Hong Kong Convention, and issued the world’s first SOC to the recycling yard. The SOC

was officially presented to Zhongxin’s Director, Mr. Liang by ClassNK Executive Vice President Toshitomo Matsui prior to ClassNK’s Ship Recycling Seminar held in Tokyo on December 13, 2012, which drew more than 300 representatives from Japan’s ship-owning community.

Mr. Matsui, Executive Vice President, ClassNK (left) and Mr. Liang, Director, Zhongxin (right).

February 2013 BC Shipping News 7

industry traffic DNV and GL merger announced

N

orwegian classification society Det Norske Veritias (DNV) and German classification society Germanischer Lloyd have agreed to merge their respective businesses in 2013. The new entity will be called DNV GL Group.

“The merger rests on a strong strategic rationale, and responds to challenges of increased globalization, rapid technological change and the need for sustainable development. Our customers will benefit from an increased service offering and global competence base as well as one of the densest networks,” says DNV’s Group CEO, Henrik O. Madsen, who will be the CEO of the combined new company. “The merger with DNV supports our long-term goal of being recognized as one of the most respected technical assurance and advisory companies in the world,” adds GL Group CEO, Erik van der Noordaa.

By combining the two international organizations, the new company will be one of the world’s leading independent technical service providers with stateof-the-art technological expertise and strong capabilities for innovation.

With more than 17,000 employees and an extensive global network of offices, DNV GL Group is positioned to meet increased international competition and even better serve the needs of customers.

The DNV Foundation will hold 63.5 per cent, while GL’s owner Mayfair SE will hold 36.5 per cent of the shares.

The new company, with a combined turnover of some EUR 2.5 billion, will be headquartered and registered in Norway.

DNV GL Group will strengthen its foothold in several areas of expertise, including the maritime segment and across the entire oil & gas value chains.

To enhance its service offering the DNV GL Group will strengthen its focus on R&D and innovation.

DNV GL Group will operate in the business segments Maritime, Oil & Gas, Energy and Business Assurance.

Its global headquarters will be at Høvik, outside of Oslo, and the maritime business unit will be headquartered in Hamburg, Germany. The transaction requires approval from competition authorities.

Nigel S. Greenwood

MA, BSc, Master Mariner, FRIN, MNI Rear-Admiral, RCN (Ret’d)

www.greenwoodmaritime.com nsg@greenwoodmaritime.com / 250-507-8445

8 BC Shipping News February 2013

Prince Rupert Container Terminal reaches half-million TEU milestone

T

he Port of Prince Rupert celebrated a historic milestone in November as Fairview Terminal surpassed its original design capacity after just five years of operation.

On November 18, the vessel COSCO Vancouver moved the 500,000th container (TEU) in 2012, a goal that was envisioned when the break bulk facility was repurposed into a highly efficient intermodal terminal in 2007. During its first full year of operation in 2008, Fairview Terminal moved a modest 182,523 TEUs. Since then a combination of strong local longshore labour, efficient terminal management and reliable rail service have given Fairview Terminal the distinct advantages that allowed this exponential growth to occur.

“This project leveraged infrastructure investments by the federal and provincial governments into the Asia-Pacific Gateway. It has made a profound impact on Prince Rupert and communities across Canada that now benefit from a direct connection to China, Korea, and other economies of southeast Asia,” said Don Krusel, President and CEO of the Prince Rupert Port Authority.

Although the facility was assigned a design capacity of 500,000 TEUs when it began operation, the productivity of labour and management at Fairview Terminal has since brought capacity to an estimated 750,000 TEUs. ILWU Local 505 has expanded significantly since 2006.

It now includes 80 unionized members and represents in excess of 200 casual employees. In 2012 Fairview Terminal continued to be among the most productive in North America — in both the number of container moves per hour and the total time containers spend moving between ship and rail.

news briefs Ferry Operators Association introduces new executive

T

he Canadian Ferry Operators Association (CFOA) is proud to announce its new executive.

This new team will lead CFOA’s Board of Directors and Members into 2013.

Incoming executive: • Captain Jamie Marshall, Chair (British Columbia Ferry Services Inc.) • François Bertrand, 1st Vice Chair (Société des Traversiers du Québec) • Susan Schrempf, 2nd Vice Chair (Owen Sound Transportation Company) • Gregg Ryder, Treasurer (Coastal Transport Limited) • Stuart Jones, Secretary (Government of Ontario, Ministry of Transportation) “We look forward to working together to showcase Canadian ferries at our upcoming Annual General Meeting and Conference in St. John’s, NL, in September 2013,” said CFOA CEO Serge Buy. “This year’s conference, “Charting

the Course: Innovative Approaches to Customer Relations” will be better than ever.”

CFOA is a member-based organization representing Canadian ferry owners and operators across the country. Ferries are an integral part of Canada’s transportation system. CFOA has more than 60 members, accounting for nearly all the major ferry routes in Canada.

Collectively, CFOA’s members: • Run a fleet of almost 140 ferries • Employ approximately 7,400 people • Carry over 40 million passengers and nearly 17 million vehicles annually The Canadian Ferry Operators Association is the national voice of ferries in Canada. Members operate with the highest professional and operational standards and promote the safe operation of ferry services in Canada.

Visit www.cfoa.ca for more information.

Captain Jamie Marshall takes over as Chair of the CFOA. Jamie is currently the Vice President, Fleet Operations and Training at BC Ferries.

February 2013 BC Shipping News 9

INDUSTRY INSIGHT

ILWU Canada: Backbone of the waterfront.

Mark Gordienko, President, International Longshore and Warehouse Union Canada

F

or Mark Gordienko, who assumed the role of President of the International Longshore and Warehouse Union Canada in March 2012 following the 16-year tenure of Tom Dufresne, the responsibility of representing over 3,000 longshoremen and marine industry workers on Canada’s West Coast is not one he takes lightly. Recognizing the importance of his role, and even more so, the importance of the role ILWU Canada plays on the waterfront, Mark relies on his 40-plus years of experience on British Columbia docks to ensure the Union stays strong and effective.

BCSN: Let’s start with some background on ILWU Canada and the locals that fall under it.

MG: There are 11 locals (see the sidebar on Page 17 for the full list) ranging in size from two members to over 1,200.

Basically, they are unions unto themselves and ILWU Canada is a federation of these unions. We provide additional resources to the locals depending on their needs, which range from direct negotiations to day-to-day administration to representation in numerous forums within federal, provincial or municipal areas of interest. The majority of the unions within ILWU Canada are for longshore workers (five of these 10 BC Shipping News February 2013

*

Since our inception in 1948, our basic mandate has been to represent workers on the docks of Western Canada and to administer local union agreements as well as bargain some of those agreements.

are tied to the same Master Collective Agreement). Others, for example Local 400, have collective agreements with a number of employers which they directly negotiate.

BCSN: In total, how many members do you represent?

MG: Approximately 3,200. Local 519 (representing longshore workers in the Port of Stewart) is the smallest; the largest is Local 500 (Longshore Division Vancouver) with about 1,200 members.

BCSN: Describe the mandate and mission statement of ILWU Canada.

MG: Since our inception in 1948, our basic mandate has been to represent workers on the docks of Western Canada and to administer local union agreements as well as bargain some of those agreements. There was no union in Vancouver for a number of years — it had been broken in 1935 but was re-formed in 1948 when an application was made to ILWU in the U.S. for

a charter. Other locals that were in existence at the time moved from the International Longshoremen’s Association (the union on the East Coast of Canada and the U.S.) to ILWU Canada.

Over time, we evolved from a loose mix of locals with a number of different collective agreements into the five existing longshore locals with one Master Collective Agreement for British Columbia. The agreement covers Vancouver, New Westminster, Vancouver Island, Prince Rupert and Stewart, and any other longshore operations in between.

BCSN: How much interaction do you have with ILWU in the U.S? MG: We are an affiliate and we have a strong, good working relationship.

I sit on the International Executive Board and we work together on issues of joint concern. We don’t pay dues to the U.S. (never have). Recently, they have branched out into the Panama Canal for

Photo credit: BC Shipping News

INDUSTRY INSIGHT

Mark with Robert Ashton, First Vice President of the ILWU Canada. the pilots and they are affiliated under the same arrangement as Canada.

BCSN: What are some of the issues of common concern?

MG: Policy, research and education, administration practices — these are just a few of the topics discussed at the international level. It’s also a platform for workers along the entire West Coast, including Hawaii and Alaska, to support each other. For example, if we’re on strike, they’ll support us; if they’re on strike, we’ll support them.

We don’t want cargo ships that would be going there to come here in a strike situation.

BCSN: Could you describe the process that led to the current structure of ILWU Canada?

MG: Of the 11 locals, five are longshore locals; one is a longshore foreman’s local; others deal with other parts of the marine industry — for example, the Port Corporation employee’s union (Local 517) or the BC Pilotage employees (Local 520). There is only one — the Ridge Meadows Recycling Society within Local 522 — that is not related to the port.

In addition to the five locals under the Longshore Master Agreement with the BCMEA, there is Local 523 (Ridley Island Terminal) who bargain separately and have their own pension plan.

They originally operated as a nonunion terminal for close to 15 years before the employees decided to form a union in 1999 and join ILWU. They now have a very good collective agreement and are growing. Local 502 (Westshore

Terminals) also has a separate agreement. Each union has developed differently and at different times. The longshore local in Vancouver originally came into being in 1948 but it was a collection of about eight different union locals that eventually merged in 1967. There used to be three locals on Vancouver Island and they merged into one in the 1990s. Local 514 (Ship and Dock Foremen) attempted to organize in the 1960s but didn’t actually get certified until the early 1970s.

BCSN: How does the bargaining process work? What steps do you take before entering negotiations?

MG: Before we start bargaining, we ask the locals to take in resolutions from the members. They do this through their own meetings and communications. They then develop a list of issues and resolutions and seek approval from their membership before forwarding to our Bargaining Caucus who then sort through all of the resolutions from all of the locals and put together a master list which is then prioritized. From there, it’s passed on to our Bargaining Committee and they eventually sit down with employers and present our demands. For the last several rounds of bargaining, the Bargaining Committee

has been the Local Presidents with the President of ILWU Canada as the head spokesperson.

BCSN: Are there any other organizations at the table during the bargaining process?

MG: I believe there are lots of organizations that have input behind the scenes — governments, boards of trade, ship owners, the Chamber of Shipping of British Columbia, for example.

They’re not at the table though. The last round of negotiations included just the officers of the BC Maritime Employers Association and, from our side, Tom Dufresne (Past President) and the four presidents of the bigger longshore locals.

BCSN: The agreements just signed for both the longshore workers and the foremen were a departure from the typical length and span eight years. Do you see this as the beginning of a new trend toward longer-term agreements?

MG: We’ll see. It’s going to be a while before we’ll be able to tell. ILWU Canada has never been adverse to this.

Our position has always been to go in to bargain one-year agreements but we’ve not had many one-year agreements.

We’ve typically gone to longer, three or four-year terms. So this is quite a change. Both sides agreed — our bargaining process isn’t really quick and painless. It usually lasts over a year and a half to two years and it’s to everyone’s benefit to have a longer one as long as it meets the needs of our members.

Eight years can be a long time to predict what will happen, for example, with the economy, but we’ve got some built in protection and if inflation passes a certain point there is an opportunity to re-open discussions.

BCSN: Have any issues arisen that weren’t covered? What happens in this instance?

MG: There are discussions on a couple of issues that normally would have gone to the bargaining table — for example, the new statutory

Eight years can be a long time to predict what will happen, for example, with the economy, but we’ve got some built in protection and if inflation passes a certain point there is an opportunity to re-open discussions.

February 2013 BC Shipping News 11

INDUSTRY INSIGHT holiday in B.C., Family Day, coming up in February. The employers’ position is that it will be quite an additional expense for which they have not budgeted, and that this is a provincial holiday (the terms of the Canada Labour Code and the Agreement recognize any federal holiday). Our position is that our workers are as important as any B.C. worker (coming under the B.C. Labour Code) and deserve the same treatment. Family is just as important to our members as it is to all other workers in B.C. We must resolve it soon as it is coming up quickly.

If we had a typical three-year agreement, this is the kind of thing that would be on the bargaining table but we do have a process to deal with issues that come up in between agreements.

It’s called the ‘Black Book’. All kinds of situations arise and there is a process for getting together to discuss these.

Andy Smith (President of the BCMEA) and I co-chair the Joint Industry Labour Relations Committee (JILRC).

That’s a formal structure but Andy and I meet frequently on an informal basis as well. We’re comfortable dealing with issues this way and can usually prove to be more productive.

BCSN: What are some of the issues that will arise during a bargaining session? Is it safe to assume that wages are usually top of the agenda?

MG: We have so many issues that we deal with that when we finally get to wages, a few pennies either way isn’t usually the main factor for bargaining.

The employers usually agree to meet the Consumer Price Index and at the end of the day, pensions and benefits are usually the easiest thing to do because generally we decide how much of our wages we want to direct to the Benefit Plan and the Pension Plan.

We have Trustees that manage the Pension and Benefit Plans — we appoint three and the employers appoint three.

Other issues have included maternity and paternity leave and, of course, technological changes.

For job security, the majority of our people go through the Dispatch Hall and a large amount are dispatched on a daily basis. Normally, dispatch is needed from Sunday to Saturday — that’s our job security. We do have a lot of regular employees and they have a seven-day guarantee. We’ve never focused on those things — our job guarantee is that they need us and we want to maintain our Dispatch Hall.

For an issue like the impact of technology, in about 1967, we signed an agreement called the Modernization and Mechanization Agreement (M&M Agreement which is now called the Retiring Allowance Agreement). It stipulates that technology changes are expected but at the end of the day, all of the jobs that remain will be done by our members.

We’ve gone through massive technological changes. When I first started on the waterfront there was a lot of manual labour — eight men down below in the hold — and it was all men

A challenging world Westshore Terminals has just completed one of the

biggest equipment upgrades in its history. This fiveyear, $100 million work has lifted capacity from 23.5 to 33 million tonnes a year; streamlined the way we handle coal; improved our carbon footprint; and greatly enhanced efficiency.

But, no world is without its challenges. The early WESTSHORE December breach of the main causeway to our deep-sea Berth One dock by a Capesize vessel is one such challenge. Westshore quickly had the rebuild under way and should be back at full capacity by mid-to late 1st Quarter.

Without challenges, it wouldn’t be the coal world we know.

w w w. w e s t s ho re . co m

We’re growing to meet demand 12 BC Shipping News February 2013

INDUSTRY INSIGHT in those days, no women. I for one am very happy to have our current mixed workforce, over 10 per cent of the workers are women, and this number is growing. Now, on a lot of ships, there are no workers down below because all you need is the crane driver who pushes a button and releases the load when it is in place. Another development that we are seeing around the world is the automation of terminals. We’re not facing it yet here and hope we will not.

BCSN: Is there a possibility of it happening here?

MG: There’s some discussion about it — Port Metro Vancouver is working on Terminal II at Deltaport. It will still be some time before becoming a reality as there are environmental, residential concerns, etc. that have to be addressed. If the project does come to fruition, I would assume there could be a higher level of automation. It’s costly to take an existing terminal and retrofit it but for new terminals, it’s a different story. It is still very costly and the productivity levels are usually a lot less than our current manned terminals.

Our position, if and when we deal with terminal automation, is that, obviously, we can’t stand in the way of progress, but every job in that terminal should be done by ILWU. That’s a lot of jobs that we’re not doing right now, including outside janitorial services, catering, security guards, etc. In the future, for automation, we’re talking about every single job, everything. It also takes a lot of maintenance people to keep these terminals running. I was at a recent International Transport Workers Federation (ITF) conference where a presenter spoke of one terminal having 400 employees but 350 of them were mechanics and electricians. There are still a lot of maintenance people needed to keep the equipment running.

What we’re looking at also is the IT work. Traditionally, terminal maintenance has required a lot of equipment and computer work and we would expect that to be done by ILWU employees.

That’s the message through the ITF that all longshore workers are going to take to employers in regard to terminal automation. Go ahead, do what you have to do but we still expect to be doing all the work. We’re still loading and unloading February 2013 BC Shipping News 13

INDUSTRY INSIGHT ships. The process and mechanics might change but we expect to do what we’ve always done.

BCSN: How does ILWU Canada get involved in other activities, like training or recruitment?

MG: Training is jointly arranged and carried out within the locals although that will change slightly with the construction of the BCMEA’s Training Centre on Mitchell Island. The training will be shared between the two Lower Mainland locals. The manuals and the resources used in training have been jointly developed between ILWU Canada, the locals and BCMEA over the years.

Each local has their own process for recruitment of new employees. They receive orders from employers or for regular workforce employees, then they fill them according to whatever arrangements they have in each local based on a coastwide document. Even though we have the Master Agreement, there are a lot of things done differently in each local. Every employer has the right to have a group of regular workforce employees and then they

complement that by ordering from the Dispatch Hall. Within the last five to 10 years, a joint document was developed for all of the longshore locals for recruitment. It provides for standard conditions but is administered by the longshore locals and BCMEA. To that, there were about 900 people recruited in 2012 alone.

2011 was a record year for hours and we are about five or six per cent ahead of that for 2012.

Aside from the recession that hit in 2009, the trend has been for everincreasing hours worked. Based on the BCMEA’s Annual Report, you can see this: In 2007, there were almost 6.07 million hours worked province-wide. In 2008, this dropped slightly (to 6.032) and then in 2009, it dropped to 4.9 million but I should note that for the last 10 to 15 years, the numbers were between 4.2 and 4.7 million so it wasn’t so much that numbers dropped but rather spiked in 2007 and 2008. Hours started to climb in 2010 (to 5.8 million) and 2011 was 6.4 million. As I said, 2012

BRITISH COLUMBIA MARITIME EMPLOYERS ASSOCIATION The British Columbia Maritime Employers Association (BCMEA) is a multiemployer waterfront organization, representing 59 ship owners, agents, stevedores, and ocean going terminal operators in the Asia Pacific Gateway. The BCMEA advocates on behalf of its Customer-Members for legislative and regulatory reform on issues affecting labour reliability. The Association is a service provider of labour relations, training, recruitment & dispatch of

longshore employees.

www.bcmea.com

The Asia Pacific Gateway contrib- utes over $12 billion to Canada’s GDP, and more than 129,500 jobs.

14 BC Shipping News February 2013

is on track to be about five or six per cent higher.

And there is room for even more growth — we’re monitoring expansions in Prince Rupert and other areas like terminals here in the Lower Mainland — Deltaport, Neptune Terminals, Westshore, etc.

BCSN: What about activities related to health and safety? How does ILWU Canada get involved?

MG: Pretty much the same as training and recruitment. There are industry standards and an Industry Safety Committee. Our Third Vice President chairs that committee and all of the locals are represented. The day-to-day work is handled by the locals but we were involved in setting up all of the documents and we make sure the standards are up to date. The standards are always changing to adapt to new equipment and new practices so we continually meet throughout the year. There is the White Safety Book which is widely used.

The committee’s work includes a review of the White Safety Book and they also review accident reports and track changes on bigger issues — for example, technology is always changing and different kinds of ships come into port and issues arise with that. Our people have always been held in high regard in that respect — we’ve had our people taken to shipyards in Asia, for example, to provide input on how to design the cranes; and we’ve had ships come in where there have been difficulties and we’ve had to make modifications. Some of the people we’ve had in the past from this office have been held in very high stature. Al Le Monnier (our former Vice President) recently received Transport Canada’s Safety Award.

BCSN: Let’s look at your members — can you identify any trends (age and demographics, for example)?

MG: Using the numbers from the Pension Plan Valuation, the longshore average age and average service have been pretty steady for a long time.

The average age of members in the Longshore Pension Plan is about 46 — over the years it will go up or down by a couple. We have a fairly constant number of departures through death and retirement and a constant inflow of people, and when you have new people

INDUSTRY INSIGHT coming in, they are generally younger and keep the averages down. There’s still some degree of transience in the workplace though. In this industry, everything happens at once. Ships are in at every terminal and everyone wants people and then two days later there’s nothing so it’s hard to recruit people.

You can make a good living if you hold on long enough to become regular but many people don’t — or can’t — wait.

BCSN: What about demographics, for example, are numbers of women increasing?

MG: When I started 40 years ago, there were no women but that’s changing and continues to evolve. Right now, record numbers of women are progressing into the membership. In the last four months alone, Local 502 in New Westminster has gone from three to 13. Out of 800 employees it doesn’t sound like much but when you consider that there was only three a few months ago and zero not long before that, it’s significant.

All new recruitment meets employment equity standards but having this filter through the system takes time. The industry required very hard manual labour years ago and most men and women didn’t want to be down here. Now, with all the automation and technology, there are still a few physical jobs but not like what it was. There’s no reason that a woman cannot do the job.

We’ve always supported equal opportunities but we have had our difficulties in implementation. Going from a 100 per cent male-dominated industry to one that is meeting equity has seen some challenges but it’s changing.

There are some growing pains but we’re working through them.

BCSN: What about government involvement? You’ve never been labelled an essential service but have been legislated back to work. Could you comment on that?

MG: Yes, that’s right, we’ve never been labelled an essential service.

In 1969/70 — the first time we bargained on a coast-wide agreement — we weren’t able to come to terms and the government legislated us back to work. I don’t recall how long we were out before that happened but in 1973/74, the work stoppage lasted about three weeks before the government sent us back. We haven’t had a

shut down since 1998 and in that case the federal government had legislation in place to have us back within three days. Since then we’ve been able to resolve our differences without government intervention.

BCSN: What about the labour laws in Canada?

MG: Recently, I flew to Ottawa with Greg Vurdela (BCMEA’s Vice President, Marketing, Customer & Government Relations) to discuss changes being made by the federal government to the Canada Labour Code. The change requires the insuring of long-term disability plans. We’ve always selfmanaged and self-insured our plans and both the union and the employers have been very happy with what we have. This would be a major funding

and philosophical change for us and we wouldn’t be able to buy the coverage that we currently provide for our disabled members. Greg and I met with four government ministries including the Deputy Minister of Labour to request wording to the law that would allow us to still manage our plan.

We have a fully funded resource for our long-term disability plan and are already meeting their goals so feel we have a good argument. Ottawa is writing the regulations now and they’ve asked for specific criteria for an exemption, which we’ve drawn up and submitted. We are still working on this.

BCSN: How do provincial labour laws factor into work on the waterfront?

MG: In 1988, the federal government set up the Waterfront Taskforce

Online...Dave Roels’ Photo Essay Longshoremen at work: Photographer Dave Roels paid a visit to Neptune Terminals to capture the essence of a longshoreman’s day.

Visit www.bcshippingnews.com/photo to see the results.

Photos by Dave Roels, www.daveroels.com

February 2013 BC Shipping News 15

INDUSTRY INSIGHT (Steve Bushell, our Vice President at the time was hired to work on it).

Basically, the Workers Compensation Board was removed from the docks for safety inspections and the federal agency took over. Ship safety is dealt with through Transport Canada but injuries on the waterfront are still administered through Worksafe BC. BCSN: In the U.S., there are now 24 states with Right to Work Legislation, the most recent to bring it in being Michigan.

Do you see this as a trend that could happen here in Canada?

MG: Obviously we don’t support that kind of legislation. There are a couple of Canadian provinces that have had some discussions but there is legislation in Canada that protects our right to a closed shop. We would strongly oppose and would do everything in our

power to fight any movement toward that here in Canada. Right now, every employee in a union workplace pays union dues, which is fair because every employee takes advantage of what we’re able to negotiate for them. For the union to be vigilant in protecting safety conditions and workers’ rights on the job, somebody has to do the job and somebody has to pay them to do it and it’s only through the members’ dues that these things are funded. On top of that, it’s a basic principle in this country that the majority rules. We’re respectful of minority rights and we do have some people who opt out for various reasons but we’ve never had a problem with those people paying their dues. That’s a strong democratic tradition in this country and I don’t see it changing.

Background on Mark Gordienko

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Photo credit: BC Shipping News

orn and raised in Victoria, Mark Gordienko started as a longshoreman more than 40 years ago on the docks in Victoria. After eight years, he moved to Prince Rupert where he spent the next 10 years, including a period as President of the Local there. When he moved to the Lower Mainland, where he has spent the last 23 years, he worked for a while on the Fraser River before moving to the Vancouver waterfront.

Mark has been President of ILWU Canada since May 2012. He has held a number of positions within the union, including Secretary-Treasurer of ILWU Canada; Chair of the Local 500 Safety Committee; and Chair of the Local 500 Membership and Grievance Committee. He has also sat as a member on a number of committees. For the past 11 years, he has been a Trustee of the Longshore Pension and Benefit Plans.

“It’s been very gratifying,” he says. “We’re able to help people. The work is interesting and I deal with members, in many cases, on a one-on-one basis.”

Married for 35 years to Sheila, they have one daughter, Jessica, who is currently enrolled in college.

16 BC Shipping News February 2013

BCSN: What about recent news reports and legal challenges to temporary foreign workers here in Canada?

MG: We’ve offered our support — including financial support — to the unions that have taken this to court.

What this is doing is bringing in foreign workers on a temporary basis that are generally working for up to 50 per cent less than Canadian citizens and they’re there to save the employers money and drive down wages in particular industries. Then they’re sent back to where they came from. It’s the opposite of what we’ve done with our immigration policies in this country since Confederation.

It’s not just wages but safety conditions as well. If you look at the most recent example of the Chinese miners, the first time the company plans to have any Canadians working there is 2016, so all through the mine development and opening production years hundreds of temporary foreign workers will be paid unbelievably low amounts of money compared to what the going wage rate is in mining — it’s disgraceful. And there are even reports that the workers are paying employment agencies to get the job to come here. We’ve always had progressive immigration policies in this country and we’ve always brought in workers who have been welcomed into the community as Canadians and have had the same full rights as every other worker. The use of temporary foreign workers completely flies in the face of this.

If we’ve got deficiencies in the workforce then, of course, something needs to be done but not through a temporary foreign worker program.

BCSN: The shipping industry is experiencing a boom right now. What are some of the factors from that that would influence operations within ILWU Canada?

MG: Canada has shifted a lot of manufacturing jobs overseas so we work at shipping out the raw resources and then at bringing in the finished products.

Our industry has always had its ups and downs. Right now we’re on a continual up but that won’t go on forever. It’s our job to make sure the waterfront keeps going and it’s our job to supply a source of labour to the employers. That’s why we’re here. We’ll do whatever we have to do to get it done. BCSN

INDUSTRY INSIGHT Background on ILWU Canada

Locals: Local 400 (Marine Division, all coastal areas of B.C.) — Local 400 represents Seamen and towboat employees in British Columbia. The membership is approximately 420 strong.

Local 500 (Longshore Division, Vancouver Waterfront) — Local 500 represents all workers employed in the loading or unloading of vessels, and all workers employed in any operation, clerical or otherwise, incidental to such loading and unloading in the waters of Burrard Inlet and Howe Sound, the City of Vancouver, and any other city, town, village, district or municipality in, at, near, around or adjacent to said waters.

Local 500 is the largest union within ILWU Canada and accounts for over 1,200 members. For more information: www.ilwu500.org.

Photo credit: Dave Roels, www.daveroels.com

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he International Longshore and Warehouse Union Canada has been successfully representing working people in British Columbia since 1948. ILWU Canada is the exclusive bargaining agent for over 3,000 men and women throughout the province. It is made up of the 11 autonomous locals and three affiliates: the Retail Wholesale Union (British Columbia), the Retail Wholesale Department Store Union (Saskatchewan), and the Grain Services Union (Saskatchewan).

The ILWU Canada Longshore Division is involved in the loading, unloading and checking of cargo to and from vessels, and the storage of these goods on the docks and in warehouses.

Cargo handled includes: • Forest Products: lumber, pulp, craft, woodchips, logs.

• Bulk Ores: coal, sulphur, zinc, lead, copper, phosrock, potash, pellets.

• Liquid Bulk: methanol, glycol, styrene, seed oil.

• Grains.

• Containers.

• Break Bulk: steel, ingots and general cargo.

Local 502 (Longshore Division, New Westminster) — Local 502’s jurisdiction includes docks along the Fraser River and the Westshore / Deltaport sites (Roberts Banks) and has seen a large increase in the amount of containers it handles since the opening of the container terminal at Detlaport in June 1997. The union’s membership consists of 800 union members with about 700 casual workers. For more information: www.ilwulocal502.bc.ca.

Local 505 (Longshore Division, Prince Rupert) — Local 505 has over 80 Union Members, 30 Welfare Casuals and about 100 Casuals.

Local 508 (Longshore Division, Vancouver Island) — Local 508 has jurisdiction for all longshore work on and offshore all of Vancouver Island. For more information: www.ilwulocal508.org Local 514 (Ship and Dock Foremen, all ILWU B.C. ports) — Local 514 includes all the ports where the ILWU is present. Foremen’s duties are to supervise longshore employees in the safe and efficient process in both ship and dock operations.

Local 517 (Warehouse/Clerical/Maintenance) — Local 517 has 180 members covering the office, trades, maintenance and marine staff of Fraser Surrey Docks Container Terminal, the Nanaimo Port Authority, Port Metro Vancouver, Squamish Break-Bulk Terminal, Port Alberni Port Authority and the Westshore Coal Terminal.

For more information: www.ilwu517.com.

Local 519 (Longshore Division, Stewart) — The Stewart Local is a small local involved in the loading of forest products and general cargo. It has two union members and a large number of casuals due to the highly seasonal nature of the Port.

Local 520 (Boatmen/Dispatcher/Office Staff) — Local 520 represents the office clerical staff, dispatchers and the deckhands for the pilots launch and the BC Pilots. The membership is approximately 30 members.

Local 522 (Warehouse/Maintenance/ Clerical) — Local 522 is made up of two entities: the Maritime Labour Centre and the Ridge Meadows Recycling Society.

Local 523 (Coal Terminal, Ridley Island) — Local 523 has over 100 members working at the coal terminal on Ridley Island, just outside of Prince Rupert.

For more information about ILWU Canada, please visit: www.ilwu.ca.

February 2013 BC Shipping News 17

HISTORY LESSON

Labour at sea: The St. Roch and her crew

By Lisa Glandt

Librarian/Archivist, Vancouver Maritime Museum

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orking on and living aboard a vessel at the same time is no small achievement. For the men who served aboard the Royal Canadian Mounted Police vessel St. Roch the daily activities of maintaining a transport, supply and patrol ship was magnified as they sailed in the cold waters of Canada’s Arctic from 1928 to 1948. Superintendent Henry Larsen kept meticulous logbooks during these voyages that recounted

sailing conditions and crew activities.

The Maritime Museum has an inspiring collection of photographs donated

by Larsen, his family and other crew members that complements the official reports and brings to life their everyday routines, challenges and adventures.

The St. Roch and her crew are most famous for being the first to sail the Northwest Passage from west to east (1940-1942); complete a transit of

Holystoning Crew are photographed “holystoning” the deck with large sandstone blocks. The scrubbing removed splinters from the unpainted wooden deck and once scoured by holystones and washed down with salt water, the deck became a smooth, even surface.

18 BC Shipping News February 2013

the Northwest Passage in one season using a more northerly, deeper route (1944); and the first to circumnavigate North America via the Panama Canal (1950). The St. Roch is proudly housed at the Maritime Museum and was declared a National Historic Site in 1962.

Lisa Glandt has been the Librarian/ Archivist for the Vancouver Maritime Museum since 2007. She started volunteering at the museum in 1999 sharing maritime stories with school children and now she preserves the stories. She can be contacted at archives@vancouvermaritimemuseum. com.

Diesel engine maintenance Chief Engineer G.W. (Bill) Peters was responsible for maintaining the ship’s 300 H.P. Union diesel engine that was installed in 1944. This proved important when the engine needed to be in top shape for getting the St. Roch up to speed to ram ice flows or risk being stuck in the pack ice.

VANCOUVER MARITIME MUSEUM Henry Larsen Henry Larsen grew up on the sea and his love of Arctic exploration fueled his efforts to join the RCMP and serve in the North. Larsen first went to sea at age 15 and was experienced in all the demands that a ship made of her crew.

Henry Larsen caulking the deck.

Larsen mending a sail.

Cargo loading The photo below shows a crew member unloading cargo from the hold at Cambridge Bay. While in the Arctic, crew had to unload the cargo onto shore by hand. Supplies were few and far between in the North so the crew had an important role in transporting and delivering goods to the remote RCMP detachments and Inuit communities.

Fresh food Crew were continually on the lookout for fresh food for themselves and for the Husky sled dogs onboard the St. Roch. As Larsen noted, “walrus meat provided a welcome change in food for us, and especially for our Inuit and our dogs�.

February 2013 BC Shipping News 19

MARITIME FAMILY PROFILE

Familiar name runs through 70-plus years of B.C. maritime history Photo credit: BC Shipping News

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Three generations of Burchett: Arthur, Shawn and Ron. By 1960, while raising a family of seven (two boys and five girls), Arthur joined on with Rivtow. He also spent two years as Manager of Northland Navigation before starting his own transportation consulting business.

Through his vast connections along the coast, and especially within First Nations communities and the federal Department of Indian Affairs, Arthur designed and set up logistic packages for companyies and towns throughout the B.C. Coast, including a contract

Photo courtesy of the Burchett Family.

he name Burchett has always featured prominently in any discussion on B.C.’s shipping community. And with good reason — there has been at least one Burchett actively participating within the industry for well over 70 years. Three generations of Burchetts — Arthur, Ron and Shawn — grandfather, father and son respectively — have each contributed to a legacy that demonstrates yet again the ingenuity, resourcefulness and innovation of local B.C. mariners.

Our story begins with a young Arthur starting out at Vancouver Tugboat Company and then Straits Towing & Salvage before joining up as the Number One Gunner on corvette vessels during the Second World War. Following the war, Arthur settled in Tofino where he worked for the Canadian Coast Guard throughout the 1940s. One of the notable achievements in Arthur’s career was the modernization of transporting fuel to lighthouses. “We designed a special barge,” recalls Arthur, “that was small enough to get into the area but big enough to carry 5,000 gallons of fuel. It was a significant challenge to get the fuel to the lighthouse until we developed a hose system that eliminated the need to carry the fuel in barrels.”

Ron (centre) with his two sons, Alan and Shawn.

20 BC Shipping News February 2013

with the Frank family to set up a freight hauling service from Tofino to Ahouset. Other significant accomplishments included working closely with the mining industry and establishing logistic routes from scratch for newly opened mines.

It was during the 1950s that the second reference to the Burchett family name became known along the waterfront — albeit more as a “pest” for those early formative years for Ron. “I was six years old when I started watching the shipbuilders in Tofino. To get me out of their hair, they would give me a box to go and pick up the wooden plugs to be re-used,” said Ron. “That got me interested in the whole experience of designing and building ships — it’s an affliction that has lasted to this day.”

Ron’s early introduction into the marine industry was reinforced over the years so that his resume reads as a who’s who of companies on the coast: Texada Towing, Rivtow, Matsumoto Shipyards, Vancouver Shipyards and Burrard Yarrows to name just a few.

By the end of the 1970s, he was working with the Central Native Co-op in Uclulet to build an aluminum fishprocessing system; following this, he designed a new series of fish boats with

MARITIME FAMILY PROFILE

The Burchett Robert Allan Training Tug (BRAtt) with Shawn Burchett driving. the team at Allied Shipyards; and then became best known as a master of innovation with dynamic working model boats.

In a culmination of experience, starting from the age of six where he would sit for hours watching and learning from boat building legend John Hansen, through to building model tugs for Rivtow and then co-ordinating the model boat show at Expo 86, Ron is only one of two people in the world who currently builds dynamic working models of vessels including barges, tugs, fish boats and ferries. Working with Futaba, a Japanese firm known for designing and manufacturing hobby-grade radio control systems, Ron has built Voith-Schneider and Z-drives to scale for working models. “No one else was building dynamic working models,” said Ron. “We saw a need to flesh out the design and the only way to test is to build an exact model to scale and test.”

Ron currently holds two positions: first as Owner, Burchett Marine Inc., and also as Commercial Marine Manager for Corvus Energy Ltd. His introduction to Corvus came through the need for batteries in one of boats he was testing. From there, to an investors meeting with a core group of seven people nine years ago, Corvus has gone from a predominantly marine-focused company supplying batteries for hybrid tugs to one with feasible uses in numerous applications spanning a diverse spectrum of industries.

Referring to his collaboration with Robert Allan Ltd., Ron noted that “we built a whole new standard of construction for models including their technical functions”. Ron and Rob also designed and engineered the BRAtt (Burchett Robert Allan Training Tug) to address the paradox of Canadian regulations that require certification for operating a fullsize tug but few opportunities to get the training that would provide for the certification. “The BRAtt is under tonnage so you don’t need a certificate to drive it,” said Ron of the quarter-scale training tug. “The biggest change I’ve seen on this coast is the inability for someone to do what we did in the early days — that is, let young people learn by doing.”

Ron points to a bureaucracy and preponderance of regulations in Canada that restricts the next generation and limits their opportunities to learn. “We need to change the way we teach — we need more mentoring and we need to encourage young people to learn by doing.”

Using the younger Burchett, Shawn, as an example, Ron described how his sons (in addition to Shawn, Ron is the father to Alan, Scott and Jacqueline) were steering boats at the age of six. Shawn describes it best as “growing up marine”. “I grew up at Allied Shipyards, watching the ships being built and driving boats during the summer,” Shawn said of his entry into the maritime industry. With a deckhand certificate obtained from the Pacific Marine Campus (now part of the BCIT Pacific Marine Training Institute), Shawn worked on charter boats and tugs (including those operated

by Dad Ron) before working for the Canadian Coast Guard for 10 years. Following his time at CCG, Shawn obtained a business degree and worked outside of the marine industry in a high tech firm for a short time. “I missed it too much,” he said of his absence from the industry. Following positions with Island Tug & Barge and Seaspan (providing dispatch and logistics), Shawn has been the Business Manager for Jastram Technologies since March 2010.

Like father and grandfather before him, Shawn is also leaving a legacy for the B.C. marine community through his work with the Royal Canadian Marine Search and Rescue. Since 1991, Shawn has kept up his skills as a mariner by working with the volunteer organization and was a key figure in the acquisition of two boats — the Craig Rea Spirit, a new 36-foot search and rescue vessel for the West Vancouver Rescue Station; and the Deep Cove Lifeboat III, a 33-foot Falkins Class Type II vessel for the North Vancouver Unit. Shawn — a coxswain and deputy station leader with RCM-SAR — worked tirelessly with Craig Rea and other volunteers to initially design and fundraise for both boats. Shawn was quick to point out the numerous people and companies that contributed to the project but, noting his modesty, we see that Jastram, Shawn’s employer, was also a contributor to the project.

With two children of his own now, Shawn may not be the last of the Burchetts who make mention in the maritime history books of B.C. And if truth be told, Arthur was technically not the first sea-going generation of Burchetts. That honour can be traced as far back as the 1600s when Josiah Burchett, an Admiral in the British Navy, wrote a book on naval warfare against France. The next generation have their work cut out for them. BCSN February 2013 BC Shipping News 21

The Maritime Labour Convention Persistence, policy significance and Port State Control

By Darryl Anderson

Managing Director, Wave Point Consulting

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epending on the state of international trade, an estimated 1.2 to 1.5 million seafarers daily serve on a world-wide fleet of over 100,000 ships that transport over 90 per cent of world trade — manufactured goods, fuel, foodstuffs and commodities. Decent work for seafarers, and fair competition for ship owners, are not topics that are frequently mentioned when Canadians discuss our international trade interests; nor do they arise when the subject of the effectiveness of marine environmental protection measures are being considered. Yet, the coming into force of the Maritime Labour Convention, 2006 (MLC, 2006) in August 2013 might serve to generate such a discussion amongst BC Shipping New readers.

Therefore, this article will serve as an introduction to the convention and provide a summary of some of the policy implications for ship owners, seafarers and Port State Control officials.

Persistence According to Seafarers’ Rights International, there will always be special hazards to life and health because of the hostility of the sea and the nature of the working conditions aboard vessels. However, much can be done to improve the quality of life regardless of the rigours of modern ship operations. The International Labour Organization’s position is that seafarers should be entitled to good living conditions, regular communications with their home, the guarantee of regular pay, adequate medical care,

22 BC Shipping News February 2013

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The Convention is a culmination of many years of persistent work to consolidate and update a broad range of fragmented labour standards into a single convention.

repatriation, social security and welfare benefits for themselves and their dependants, irrespective of the flag they are sailing under and the type of trade in which they are engaged.

The Convention is a culmination of many years of persistent work to consolidate and update a broad range of fragmented labour standards into a single convention. The policy intent was the creation of one global instrument that addresses all of the issues faced by seafarers.

While the MLC was adopted in 2006, there were two requirements that had to be met before it could come into force: first, that countries representing 33 per cent of the world’s gross shipping tonnage ratify the convention (this requirement was met in 2009); second, that at least 30 International Labour Organization (ILO) member countries ratify the Convention. Canada did its part by being the tenth country to ratify the convention in 2007. On August 20, 2012, the International Labour Organization received the 30th ratification of the MLC, 2006. When the ILO issued a press release announcing that the last outstanding condition had now been met, Director General Juan Somavia stated that “this was great news for the world’s more than 1.2 million seafarers”.

Main policy features As the fourth and final pillar of the international maritime regulatory regime, the MLC, 2006 is a significant public policy achievement. The existing three pillars are the International Convention for the Prevention of Pollution from Ships, 1973 (MARPOL), the International Convention for the Safety of Life at Sea, 1974 (SOLAS), and the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, 1978 (STCW).

There are a number of issues that gave rise to the need for minimum international standards for seafarers.

Working and living conditions, occupational health and safety, causes of fatigue, crew retention and motivation, and recruitment are some of the most important reasons. As a result, the MLC, 2006 covers conditions of employment, accommodations, food and catering, health protection, medical care, welfare and social issues and recreational facilities. Subject to few exceptions, the convention applies to all ships, whether publicly or privately owned, ordinarily engaged in commercial activities.

The Maritime Labour Convention, 2006 is very broad in content and complex to implement onboard ships.

Thus, it is not possible in this brief article to fully illustrate the scope of the

Canada’s policy position In Canada, there was very little political debate or public attention devoted to the ratification of this Convention.

This may stem from the fact that Canadian laws and practices already highly conform with the MLC, 2006.

Nevertheless, it may come as a bit of a surprise to labour policy advocates that

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To assist ship owners, Lloyd’s Register and the UK P&I Club have introduced the ILO MLC Pocket Checklist in both a conventional format and, for the first time ever, a smartphone app to help operators comply with Convention requirements...

Photo credit: ©iStockphoto.com/wavepointconsulting

issues — rather, the structure of the Convention will be outlined to illustrate some of the important features of the convention for both ship owners and seafarers.

MLC, 2006 is divided into three parts: Articles, Regulations and Code.

The first two establish core rights, principles and obligations. The Code itself provides the details for implementation of the regulations. The Regulations and the Code are organized under five titles: • Title 1: Minimum requirements for seafarers to work on a ship; • Title 2: Conditions of employment; • Title 3: Accommodation, recreational facilities, food and catering; • Title 4: Health protection, medical care, welfare and social security protection; and • Title 5: Compliance and enforcement.

Each of the titles consists of regulations (framed with a stated purpose which forms an introduction to each regulation), standards and guidelines.

The standards all have mandatory force while the guidelines do not. For example, Title 1, which sets out the minimum requirements for seafarers to work on a ship, has four regulations: minimum age of people permitted to work aboard a ship; provision of medical certificates; seafarers’ training and qualifications; and recruitment and placement.

Title 5, on compliance and enforcement, for example, addresses the following Flag Sate responsibilities: • To define the national Flag State requirements; • To inspect and certify vessels against the new Convention and national requirements; • To authorize recognized organizations; and • To have procedures for handling seafarers’ complaints.

maritime labour

The MLC, 2006 establishes the working conditions and requirements for crew onboard vessels and highlights Flag State, Port State and labour-supplying responsibilities. the Conservative government ratified the Maritime Labour Convention on June 15, 2010, while a minority government, led by Prime Minister Stephen Harper, was in power.

On a technical level, most of the Convention’s provisions are implemented through the Canada Labour Code and the Marine Occupational Safety and Health Regulations and the Canada Shipping Act, 2001 (CSA, 2001). Effective July 1, 2007, the MLC, 2006 was added to Schedule 1 of the CSA, 2001. Yet more than one level of the federal civil service is involved in providing oversight. For example, Transport Canada and Human Resource Skills Canada are required to work collaboratively on occupational safety and health issues under the Convention. This raises an important question of what procedures are in place at a federal level to ensure an effective oversight mechanism free of political turf building, or under-investment of resources given the current fiscal climate and government budget.

Port State Control implications for ship owners In November 2011, Canada was the host authority for the first specialized training course pursuant to the Tokyo Memorandum of Understanding. The theme of the training course, held in Vancouver, was the Maritime Labour Convention, 2006. Port State Control officers received in-depth training on key features of the Convention that pertain to Port State responsibilities, including: • The inspection of its own national flagged vessels in port; and • The enforcement of the new Convention standards on foreignflagged ships under the “no more favourable treatment” requirement.

Rick Ferraro, Client Training Manager for Lloyd’s Register Americas, has noted that, under Title 2, there are a number of very critical inspection items, along with some of the provisions in Title 3. For example, Port State Control officials are required to pay February 2013 BC Shipping News 23

maritime labour particular attention to: • The size of rooms and other accommodation spaces; • Heating and ventilation; • Noise and vibration and other ambient factors; • Sanitary facilities; • Lighting; and • Hospital accommodation.

To assist ship owners and operators to comply with the Convention’s requirements and reduce the risk of Port State Control detentions or delays, Lloyd’s Register and the UK P&I Club have introduced the ILO MLC Pocket Checklist in both a conventional format and, for the first time ever, a smartphone app. Ferraro estimates that on a bulk carrier with 16 crew members, inspection time, even with a sampling approach, will typically take between nine and 10 hours. The pocket checklist app serves as an interactive tool that enables ships’ crew and managers to check off required activities as they are completed. The app is free and will be available for iPhone, iPad, Android devices, Windows phone and BlackBerry.

Port State Control implications for seafarers The issue of seafarers’ complaints warrants discussion because the MLC, 2006 has a number of requirements.

Most notably, ships are required to

have onboard procedures for the fair, effective and prompt handling of seafarers’ complaints alleging breaches of the requirements of the Convention.

Seafarers have the right to complain directly to the master and, where they consider it necessary, to an appropriate external authority. In addition, Port States must have procedures for complaints made while onshore.

Time will tell if the MCL’s seafarers’ complaints procedures are effective in preventing or resolving labour-related issues onboard a ship. Dr. Moira McConnell, Professor of Law and Associate at the Marine & Environmental Law Institute, Dalhousie University notes that, from a legal perspective, “one of the more important features of the MLC, 2006 is that it emphasizes the possibility for seafarers and other individuals or groups to have a role in the overall goal of ensuring compliance and enforcement of the MLC, 2006.” Dr. McConnell pointed out that, while there are already several different avenues to make a complaint or provide information, the MLC, 2006 will provide greater possibility for a complaint or information to be given to a wider range of people, such as a union or an association and importantly including: “any person with an interest in the safety of the ship, including an interest in safety or health hazards to seafarers onboard” in

com m e rci a l a nd m ar itim e law on c an ada's we s t coa s t.

W. Gary Wharton Mark W. Hilton Katherine A. Arnold David S. Jarrett

Nevin L. Fishman David K. Jones Catherine A. Hofmann Mark Tinmouth

Peter Swanson Neo J. Tuytel Connie Risi

associate counsel:

Lorna Pawluk

Joan Rush

Thomas S. Hawkins Tom Beasley Paul D. Mooney

Peter G. Bernard, QC (retired) tel: 6 04.681.1700 fax: 6 0 4 .6 8 1.17 8 8 emergency response: 604. 681 . 1 700 address: 1500–570 Granville Street, Vancouver, BC, Canada, V6C 3P1 website: www.bernardpartners.com

24 BC Shipping News February 2013

Port States. “Depending on the nature of the concern, these complaints can trigger a more detailed inspection during Port State Control while at the same time protecting the individual seafarer from possible reprisal.”

Another important change that Dr. McConnell noted was a greater ability to respond to complaints, especially in Port States: “The MLC, 2006 brings together 37 existing ILO Conventions in one place so it will make it much simpler for Port States to deal with complaints in that there is no longer a need to check whether the Flag State has ratified the Convention in question. Either they are bound because it has ratified the MLC, 2006 or, if the Flag State has not ratified the MLC, 2006, then because of the application of the no more favourable treatment provision they will need to have similar measures in place onboard the ship.”

Members of seafarer welfare organizations, such as the Mission to Seafarers and the Apostleship of the Sea Canada, may wish to provide their clients with information on the Canadian procedures for filing complaints so that any seafarer can more readily access their legal rights. In addition, shipping agents and vessel owners would be well-advised to become aware of Transport Canada’s Port State Control procedures in this regard if they wish to avoid unnecessary vessel delays.

Conclusion Since Canada is not a major shipowning nation and Canadian mariners that do serve in the international merchant fleets are most frequently abroad, it is perhaps not surprising that the MLC, 2006 has generated only a limited amount of discussion. It is hoped that this article will serve to peak the reader’s interest from a maritime law, seafarer’s welfare, or ship owner’s perspective.

Dr. McConnell argues that we should all have an interest in the implementation and effectiveness of MLC, 2006 even those who are primarily involved in land-based activities. Dr. McConnell rightly asserts that “not only are labour, social and economic matters relevant to marine environmental protection, they should be viewed as central concerns.

maritime labour Too often, the human and economic dimensions are left out of the discussions about preventing ship-source operational or accidental harms to the marine environment.

However, this concern — the working and living conditions and social rights for ocean workers/seafarers/fishers…is so sparsely dealt with in the 1982 United Nations Convention on the Law of the Sea (UNCLOS) that it can be considered a regime gap.”

Dr. McConnell further asserts that “from an environmental perspective we cannot ignore the fact that too often shipsource pollution, especially in the case of accidents, is attributable to fatigue or other human elements”. Establishing working conditions that avoid fatigue or other occupational health hazards are key elements in ensuring the IMO’s goal of safer ships and cleaner seas.

The ILO intends to use the performance indicators of deficiencies, detentions and seafarers’ complaints as measures for gauging the effectiveness and success of the MLC, 2006. While this will be a good start, industry analysts have suggested that it will take two or three years to see how this “Seafarers’ Bill of Rights” is actually unfolding.

Nevertheless, Dr. Progoulaki, Maritime HR Consultant at the University of Aegean indicated that: “since higher standards of both working and living conditions are now set by theSCA0019A MLC, itAdis- believed that the MLC will not only8:30:34 represent, BC Shipping News.pdf 1 10/19/2012 AM but will actually be the fourth pillar of Quality Shipping.”

Darryl Anderson is a Victoria-based consultant. He maintains an active independent research practice focusing exclusively on maritime transportation and policy issues. See: www.wavepointconsulting.ca for more details.

February 2013 BC Shipping News 25

The wild and wacky world of coal exports

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By Ray Dykes

T

he frenzy of action to build new or expanded coal export terminals in the Pacific Northwest has attracted a surprising storm of protest and business, unions and others favouring the jobs are being shaken out of their lethargy.

Never before to such an extent has a simple coal terminal expansion project come under the environmental microscope so directly amid a fuss of indignation among municipal politicians who seem keen to dip their oar in national and international matters.

Whether it’s to block coal trains or ban coal shipments altogether, the fact that they have no jurisdiction hasn’t fazed politicians in Seattle or Vancouver, B.C., as they pass motions seemingly aimed at improving global climate change and local air quality.

Even local B.C. health leaders — the BC Lung Association, the Public Health Association of BC, and the Canadian Association of Physicians for the Environment — have written to Port Metro Vancouver asking for a delay on two coal export proposals under consideration. One is an expansion of capacity at North Vancouver’s Neptune Bulk Terminals and the other a new project to ship coal from Fraser Surrey Docks to Asia via Texada Island.

The health officials are urging the port to thoroughly assess the “cumulative health impacts” of exposure to diesel exhaust from trains and coal dust, fearing approval of the two projects would increase both.

There’s even concern among some worried environmentalists that Port Metro Vancouver could become the largest exporter of coal in all of North

26 BC Shipping News February 2013

...there’s no convincing some environmentalists, it seems, of the fact that Port Metro Vancouver facilities have held the “busiest coal exporter in North America” title for many, many years without causing any serious issues.

America and fear any pollution this could bring.

They don’t always bother to check their facts. Port Metro Vancouver has held the title of the “busiest coal export facility in all of North America” for about a decade now thanks to the exports of Westshore Terminals, which was at one stage the largest single exporter of coal in all of the Americas — that’s both North and South America.

Surpassed Only in the past year or two has Westshore’s record coal exports of up to 27.3 million tonnes (2011) been surpassed by Puerto Bolivar in Colombia where shipments have topped 30 million tonnes a year amid occasional terrorist attacks on the mines and railway.

However, there’s no convincing some environmentalists, it seems, of the fact that Port Metro Vancouver facilities have held the “busiest coal exporter in North America” title for many, many years without causing any serious issues.

Jumping on the bandwagon, the Globe and Mail chipped in with an article late in December under the heading: Is it time to put the brakes on runaway coal development? The writer noted a dozen or so new mines proposed around the province and “the Port of Metro

Vancouver making expansive plans to become the biggest coal exporting facility in North America”.

And he surmised that “the flurry of activity is raising environmental concerns at both ends of the supply chain, and British Columbia may soon want to put the brakes on what is starting to look like a runaway coal train”.

Quoting researchers worried about increasing levels of selenium downstream from coal mines in the Elk Valley (where at least one new mine is proposed), the writer mused: “That’s the trouble with coal. At one end of the supply chain, it causes invisible water pollution. At the other end, it vanishes in smoke, adding to our climate change woes.”

Most who have heard of selenium will probably know, as the U.S. Office of Dietary Supplements, National Institutes of Health puts it, that selenium is “a trace mineral that is essential to good health, but required only in small amounts”. Oh, by the way, you probably get your selenium from Brazil nuts, tuna or cod, chicken or turkey to name a few. The trouble seems to be what excessive levels of selenium might be doing to fish eggs and future generations of such fish as cutthroat trout downstream from the coal mines.

Sometimes bad luck can dog even the best of facilities as North America’s leader in coal exports, Westshore Terminals, found on December 7 last when the dry bulk carrier Cape Apricot crashed through a connecting causeway to the main deepsea berth wiping out over 100 metres of road, conveyor and water and power lines, leaving its major Berth One cut off.

The environmental doomsayers had a field day, openly encouraging the thought that there was alarm over a huge coal spill, or more simply to highlight the risks of handling ships so big — the Capesize vessels are generally up to 180,000 deadweight tonnes — for coal, oil, or natural gas.

Minimal spill That there was only a minimal spill easily handled without damage to fish or wildlife at Roberts Bank or in Georgia Strait — or that Westshore had successfully handled over 8,300 ships and 700 million tonnes of coal without any such incident ever before — were glossed over in the initial coverage of the early morning event. No one seemed to care either that coal is inert in the form handled at the terminal or that Westshore has been free of major environmental incident in its 42-year history.

In this current climate, has all the fuss over moving coal adversely impacted the five new coal export terminal projects in Washington and Oregon? The causeway crash couldn’t have come at a worse time

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COAL TERMINALS ...there’s no doubting one mariner got it right recently when he surmised: “These days you couldn’t build a sandcastle on a White Rock beach without upsetting someone.”

as it has armed the environmentalists and others with another reason to say: “I told you so.”

It’s tough out there in the new reality of terminal expansions or creations.

And there’s no doubting one mariner got it right recently when he surmised: “These days you couldn’t build a sandcastle on a White Rock beach without upsetting someone.”

U.S. projects So, just how are the major U.S. projects faring in their bid to add a combined 100 million tonnes to West Coast export coal handling capacity?

About 2,000 people — described in media coverage as “mostly anti-coal” — attended the latest public hearing in Seattle in mid-December on a proposal to build a new coal export terminal at Cherry Point near Bellingham. The $665 million Gateway Pacific proposal for Stevedoring Services of America and Peabody Coal has attracted over 9,000 public comments so far on a project that could see up to nine trains a day and a three-berth facility built on a 1,500-acre site capable of handling up to 50 million tonnes of coal a year, plus grain and potash exports.

With a January 21, 2013, deadline looming for public comment, the U.S.

Army Corps of Engineers will then determine the scope of what should be included in the environmental review.

In Oregon, the most advanced proposal so far is the Ambre Energy project to ship coal down the Columbia River from Boardman by covered barge to a new facility at the Port of St. Helens near the Pacific Ocean but still on the river. The Oregon Department of Environmental Quality has hosted several meetings so far to take comments and answer questions about permits required for the proposed Morrow Pacific Project for Ambre.

About 200 people attended the Boardman meeting early in December, asking questions from how a barge fire would be handled to concerns over coal dust. Some people urged there be a regional environmental impact statement which would look at the cumulative effects of exporting coal from all five proposed terminals in the Northwest.

Three other coal export terminal proposals at Longview, Washington and St. Helens (Kinder Morgan) and Coos Bay, Oregon, are still in early feasibility and pre-public hearing stages.

Business groups and unions, favouring the jobs and wealth associated

In early December 2012, Berth One at Westshore Terminals got in the way of the Cape Apricot. Repairs should be complete before the end of March. (Photo credit: Ray Dykes, PR Plus.)

February 2013 BC Shipping News 27

COAL TERMINALS

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He believes the debate percolating “should take place among citizens, industry and the levels of government that establish the port’s mandate” and says the port will “participate as appropriate if the debate is held in a balanced and respectful way”.

Recently, Xotta and Port CEO Robin Silvester were in Asia promoting PMV and building on the “tremendous demand” for Canadian resources. Xotta said they had a “really powerful message” about the strength of the Canadian economy, Canada’s banking system, the lead the federal government is taking in focusing on trade and improving the supply chain, and the provincial government investment in such things as the new Port Mann Bridge.

“Along with that comes opportunities,” he adds. Which is probably why Fraser Surrey Docks and Neptune want to get more involved in the coal industry, a fuel and steel-making commodity much needed by Asia.

Increased coal exports in the Pacific Northwest could yield a net economic gain to the national economy of between $2 billion and $6 billion a year...

with each project have also been speaking out either in or outside the public hearings to convince others that “we can create jobs and protect the environment at the same time”.

Increased coal exports in the Pacific Northwest could yield a net economic gain to the national economy of between $2 billion and $6 billion a year, according to the Energy Policy Research Foundation.

With the U.S. economy still in the “red zone”, the pro-export terminal lobby points out that exports will continue to play a major role in “helping turn things around”. Both manufacturers and local labour leaders south of the 49th Parallel say they oppose more regulations, which the Washington Public Ports Association has reportedly called “unprecedented and highly detrimental to the development of freight infrastructure and to Washington’s trade-based economy”. The Pacific Northwest Waterways Association believes the call for wider regulatory approvals is “inappropriate” and “irresponsible”.

Fraser Surrey Docks The FSD proposal to barge coal down the Fraser River to Texada Island before transshipment to ocean-going vessels destined for Asian markets is at the permitting stage with Port Metro Vancouver.

Xotta says the proponents are currently answering questions raised by the Port as part of the normal process. FSD has kept the public informed with at least one newsletter in the Fall about its coal intentions and posts details of frequently asked questions and other technical matters on its website.

Photo credit: Dave Roels/www.daveroels.com

Port Metro projects Meanwhile, back in British Columbia and Port Metro Vancouver, neither the Fraser Surrey Docks venture into coal nor the Neptune Bulk Terminals expansion proposal has been approved so far.

Port Metro Vancouver Vice President of Planning & Operations, Peter Xotta, tries to keep things in perspective when he discusses the two proposals while not ignoring the opposition out there from some against coal exports.

“Our mandate at the port is to facilitate the growth and support of international and domestic trade in Canada with safety, efficiency and sustainability in mind,” he says.

Neptune Terminal has submitted an application to Port Metro Vancouver to expand its coal capacity.

28 BC Shipping News February 2013

Located at Vancouver Waterfront and Roberts Bank

www.flyingangel.ca

COAL TERMINALS “We are committed to making sure the proposal is thoroughly assessed by the Port,” says Xotta. “It would be presumptuous to say at this stage what might come out of this process.”

FSD plans to bottom-dump coal trains and conveyor-load barges without increasing the footprint of the terminal. The move into coal would see one train a day arrive for dumping at its peak and by then annual capacity is expected to be about eight million tonnes.

Barges would transport the coal down-river and out into the Strait of Georgia en route to Texada Island where an existing export coal loading facility would transship the cargo to deepsea vessels.

Neptune expansion A project permit application by Neptune to expand its coal capacity by six million tonnes a year was submitted to the Port on June 1, 2012, and involves the addition of an enclosed rail car dumper, new conveyors, and the replacement of a shiploader boom

plus foundation reinforcements at Berth One — all within its existing footprint.

Neptune has been active in the community publicizing the expansion plans which will allow ships to be loaded with steel-making coal without needing to be moved during loading. The project will increase the terminal’s coal-handling capacity to 18 million tonnes a year and bring in about one extra train a day and one additional ship per week.

For sale Meanwhile, for the second time in the past decade, the federal government has put Ridley Terminals in the Port of Prince Rupert up for sale. Last time, the second largest coal export facility in B.C. was taken off the market after disputes over whether northeast coal mines would continue to have access to the terminal under any new owners.

The terminal is expanding and is a much better buy than when last offered. By 2014, Ridley expects to have more than doubled capacity from 12 to 25 million tonnes.

According to the Minister of State for Finance, Ted Menzies, private ownership could allow the terminal to boost its contribution to economic growth, jobs and new investments. And the sale will remove a thorn between Ridley and other B.C. coal export terminals as it has been propped up by federal funds in several money-losing years in the past.

At one stage in the 1990s, it didn’t ship a single tonne of export coal and reverted to exporting such things as wood pellets. But, that was then.

Today, it is a booming, much-indemand facility that will soon have the capacity to satisfy existing mines in the Northeast plus a host of other mines likely to come on the market in the next five years.

The sale will also represent the end of an era as Ridley is the last major terminal to be owned and operated by Ottawa. Stay tuned.

Ray Dykes is a journalist who has worked his way around the world as a writer/photographer. Ray can be reached at prplus@shaw.ca.

February 2013 BC Shipping News 29

The year ahead for the shipping industry

By Captain Stephen Brown President, Chamber of Shipping of British Columbia

J

ane has once again asked me to dust off my crystal ball and look ahead at what awaits us in 2013.

Winding the clock back to 1913, excitement was building in the United States as the construction of the Panama Canal entered its final phase whilst in Europe, as the first stirrings of war were causing alarm, the warship HMS Queen Elizabeth was launched as the world’s first oil-fired battleship. Suffice it to say, we have come a long way in these past 100 years as we now contemplate the challenges posed by LNG as the marine fuel for the future.

For our Chinese colleagues, February 10 this year marks the beginning of the “Year of the Snake”. According to Chinese astrology, a person born in the Year of the Snake is the wisest and most enigmatic of all. He or she can become a philosopher, a theologian, a politician or a financier and such a person likes to live well. Notably, Chairman Mao was born in the Year of the Snake.

I occasionally reflect on my own years working in that country, in the port of Tianjin, 20 years ago. Any thought at that time that China was destined to dominate our global industry within two decades was little more than a pipedream, however that’s exactly where we now find ourselves. Chinese imports and exports drive the global container and bulk trades whilst the demand for Canada’s commodities, which ultimately are vital to the sustainability of our own economy, will be increasingly dependent on the needs of the Chinese manufacturing and construction industries for years to come.

30 BC Shipping News February 2013

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Whether leading investment in our ports, driving cranes, piloting ships or working hard every day simply to ensure accuracy of cargo documents, everyone’s role is important and everyone’s role should be acknowledged.

So, as part of the global marine community, we have a significant responsibility. The prosperity of Canada and the wider global economy is inextricably linked to our ability to move commerce efficiently and safely through our ports, also through those coastal waters over which we have jurisdiction and influence. Whether leading investment in our ports, driving cranes, piloting ships or working hard every day simply to ensure accuracy of cargo documents, everyone’s role is important and everyone’s role should be acknowledged.

The year 2012 saw groups with an agenda against the export of oil and coal have themselves a field day.

Unfortunately, many opportunistic politicians who should really know better chose to jump on these band wagons rather than engage in the more constructive conversation as to how we can further facilitate and ensure the safe movement of all commodities through our ports. It is not the marine industry’s responsibility to decide what moves, but it is our clear responsibility to safely move it and we have an enviable record of doing so.

As an industry, there should also not be a daily need to engage in challenging the deliberate mis-information and frenzy that is driving

the political debate surrounding the Enbridge Northern Gateway and the Trans Mountain Pipeline Expansion projects. However, we have promoted, and in 2013 will continue to promote, the facts relevant to marine safety in British Columbia. Just to be clear, this debate is not happening anywhere else in the world, not even elsewhere in Canada — British Columbia has been deliberately targeted by environmental groups for their current well-orchestrated and well-financed campaign.

So what of 2013?

A few things to consider: • The European economies will continue to struggle under the threat of continued recession and the need for financial bailouts. Shipping will suffer in tandem. At some point, the European Union will surely recognize that over-regulation is strangling the Euro Zone economies and is adding an unproductive fiscal burden.

• The pace of recovery of North and South American economies will gather steam and this will be reflected in steadily improved trading prospects.

• The primary global driver will be China, the slowing of whose economy in 2012 was managed to ensure a “soft landing” rather than a bust.

I would predict that the economies

SHIPPING FORECAST

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of China and the Asian tigers will regain steam in 2013 and that the Pacific will be the preferred place to do business.

• There has to be another round of consolidation in the container industry. Years of minimal or no returns on investment are unsustainable and building ever-bigger ships without a stable freight rate mechanism to support them is not a solution — it is in fact compounding the problem.

• Piracy will continue to be the scourge of the marine industry both off Somalia and Nigeria. Half-starved and often mentally deranged seafarers, after suffering many months of mistreatment at the hands of their captors, remains a blight of our industry and the governments that sit on their hands whilst it happens.

It is some sort of madness that any maritime development, or even maintenance of an existing facility, is increasingly subject to “precautionary approach” environmental assessments that can bring excellent projects to their knees.

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The environmental front line This is the front line of the battle with those who fail to recognize the importance of our industry to world trade growth and the global prosperity which that in turn generates. It is some sort of madness that any maritime development, or even maintenance of an existing facility, is increasingly subject to “precautionary approach” environmental assessments that can bring excellent projects to their knees.

At some point the line will surely need to be drawn.

•

•

On the active front we have a number of developments:

requires around six per cent of world gross registered tonnage (GRT) to achieve ratification and will only take effect one year following. The IMO is pushing flag states hard for ratification but owners are understandably nervous to make the investment in ballast water treatment systems (as required by the convention) given continuing concerns around the reliability of the type-approval process and the decision of the U.S. to generate its own ballast water treatment standards.

• IMO’s MARPOL Annex V also took effect on January 1, 2013. Under this legislation, cargo residues, including those entrained in cargo hold wash water are included under the definition of garbage and must therefore be managed as part of the garbage management plan. Any discharges into the sea and/or to port reception facilities must also be recorded in the Garbage Record Book.

Other focus issues for 2013 The full ramifications of the Costa Concordia incident have yet to be felt. At the time of writing, Italy, as the vessel’s

Source: www.shipspotting.com / Ian Thomas

• As allowed for under the IMO’s MARPOL Annex VI, the North American Emissions Control Area (ECA) is now in effect and stretches 200 nautical miles from our coastline. The supply of low sulphur fuel in support of the ECA is gradually easing but the differential cost of around $280 per ton is making it a very expensive proposition. When the allowable sulphur in fuel limit is reduced to 0.1 per cent in 2015, there are certain to be repercussions in response to even higher fuel costs and low availability.

• That the IMO has declined to advance the 2018 fuel availability study in relation to the global sulphur in fuel standard of 0.5 per cent in 2020 makes no sense at all. The “it

•

will be alright on the night” approach is not helpful in preparing us to confront a serious issue.

The greenhouse gas debate trundles along. Whilst both the Energy Efficiency Design Index (EEDI) for new ships and the requirement for vessels to be equipped with a Ship Energy Efficiency Management Plan (SEEMP) both took effect on January 1, there is little prospect that shipping or aviation will agree to underwrite a global “green fund” through marketbased measures as a few unrealistic groups seem to believe they should.

Notwithstanding the above, in 2013, our industry’s attention will be further focused on construction of eco-designs as the quest for reduced fuel consumption and low emissions gathers pace. Shipyards are falling over themselves to offer their latest products and owners are having to apply a great deal of technical due diligence in evaluating their options.

Projects to promote the use of LNG as a marine fuel will accelerate in 2013.

The IMO Ballast Water Management Convention on the other hand still

The Al Mayeda, a LNG carrier of membrane design.

February 2013 BC Shipping News 31

SHIPPING FORECAST

Source: Kitimat LNG

countries and should be deemed as unacceptable to the world at large. The International Shipping Associations have therefore collectively called for the principles surrounding Ports of Refuge to be put firmly back on the agenda at IMO in 2013. We will follow with interest.

Artist’s rendering of the Chevron-Apache LNG project in Kitimat. flag state, has still to present the findings of their obligatory accident report to the IMO. Even so, it seems clear that a hard look will be taken at the extent of sub-division and reserve stability in passenger-carrying vessels in the event of such catastrophic damage. The cruise lines themselves have already implemented several operational changes and there will likely be more to come, however, we should not lose sight of the overall excellent safety record of that sector.

This issue of sub-division will likely also extend once more to RO-RO vessels following a collision and the loss within 15 minutes of the Baltic

32 BC Shipping News February 2013

Ace in the approaches to the Port of Rotterdam in December. Tragically, 11 seafarers were lost.

Another notable casualty in 2012 was the explosion, extensive fire and subsequent salvage of the container ship MSC Flaminia in the mid-Atlantic.

With the fire extinguished, the vessel was towed by salvage tugs to the western approaches of the English Channel and there she sat for a week seeking a Port of Refuge. The U.K., Ireland and France all failed in their responsibility to offer refuge and it was finally left to Germany to provide safe haven.

This is a stain on the reputation of the maritime administrations of those

Closer to home We are concerned with multiple issues as a new year gets underway. To list a few: • The overall operating costs and competitiveness of British Columbia’s ports in all sectors of the industry.

• Support for existing and future commodity exporters, whether LNG, oil, dry bulk, break bulk or in containers to the extent that our industry is both “economically essential and environmentally responsible”.

However, with respect to the export of oil in particular, we anticipate to be working closely with stakeholders and the federal government to allay some of the specific areas of concern that are frequently voiced.

In so doing it is hoped that we can raise the level of debate beyond that of speculation and mis-information to one of objectivity.

• The draft report of the Pacific North Coast Integrated Management Area (PNCIMA) has been published. The report has realized the worst fears of the marine industry as to the direction that PNCIMA was almost predestined to go and the draft report has therefore received strong pushback from our sector. The final plan is due to be published early this year.

• The Georgia Strait National Marine Conservation Area (NMCA). As we now know, this initiative has been around since 2004 but was not publicly announced until late 2011 and despite being a major stakeholder, it was not until late 2012 that the marine industry received the courtesy of a first consultation from its sponsor Parks Canada. We suspect that this will be a major issue for our attention in 2013.

• In May this year, Canada will assume leadership of the Arctic Council from Sweden as part of a two-yearly rotating Chairmanship. The Council was formed following the Ottawa Declaration of 1996 with permanent

members being Denmark (including Greenland and the Faroe Islands), Finland, Iceland, Norway, Russian Federation, Sweden, and the United States plus a number of permanent participants representing aboriginal interests. China has, incidentally, applied for “Permanent Observer” status of the Council whilst Japan is officially an ad hoc observer. How Canada will put its term of leadership to good use remains to be seen, however the primary issues are the IMO’s Polar Code, resource development, oil spill response, fishery protection and measures to reduce the emission of black carbon which accelerates the melting of sea ice.

• Related to the National Shipbuilding and Procurement Strategy, we hope success in ironing out final contractual details will allow for Seaspan’s Vancouver and Victoria Shipards to cut the first steel this year.

• It will be important that the Container Drayage Leadership Team (CDLT) develop a holistic, credible, short, medium and long term strategy to deal with the challenges of truck access to the container terminals. This will require all parties to adjust to the need for reservations to be more evenly spread over the working day but whatever the time of a reservation, truck drivers should have confidence that they will be served both timeously and respectfully.

Logical but pragmatic amendments to the PMV Truck Licensing System (TLS) will also be forthcoming.

• Canada Border Services Agency (CBSA) new reporting requirements: We have pushed back strongly against some of the most recent initiatives from CBSA on the grounds that they exceed the CBSA mandate, are not legislated and will not achieve the intended objective.

It is truly alarming that this agency seeks to pile legislation on an industry whose daily business the agency clearly does not understand, in particular at a time when the federal government is trying hard to reduce bureaucracy through the Red Tape Reduction Commission: “Between January and March 2011, the Red Tape Reduction Commission consulted with

*

shipping FORECAST ...we cannot simply talk about collaboration and partnerships as a road map to success, we have to walk the walk in a truly meaningful way.

Canadians and received approximately 2,300 ideas about red tape irritants that get in the way of business productivity.”

• Transport Canada and Canadian Coast Guard fee revisions: Whilst both agencies are mandated by the Treasury Board to narrow the gap between operating costs and income, we must ensure that both sides of the equation receive equal attention. The Canadian “User Fees Act” of 2004 (originating from a private member’s bill) certainly imposes some interesting challenges on government departments seeking to raise fees.

• Canadian Food Inspection Agency (CFIA) and Asian Gypsy Moth Policy: In this respect, policies adopted in 2012 were completely

unrealistic and we are working with CFIA to avoid a repeat in 2013.

In conclusion, whilst much continues to be achieved, there remains a great deal to be done. However, we cannot simply talk about collaboration and partnerships as a road map to success, we have to walk the walk in a truly meaningful way. The Chamber of Shipping is entirely committed to playing its role and we earnestly look forward to engaging you in crafting solutions to our collective challenges.

Stephen Brown joined the Chamber of Shipping of British Columbia in September 2008. He currently sits on several committees and boards representing the interests of the B.C. shipping community. He can be reached at stephen@cosbc.ca. For more information on the Chamber, please visit: www.cosbc.ca.

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February 2013 BC Shipping News 33

34 BC Shipping News February 2013

Passenger ship safety since 1912

By Nigel S. Greenwood

Greenwood Maritime Solutions Ltd.

T

he past year has drawn public attention to the subject of passenger ship safety in two very striking ways. The first, the centennial of the Titanic sinking, needs little further comment. Indeed, the profusion of popular histories of the Titanic tragedy might induce a casual observer to suspect nothing much else had happened in sea-travel since then. But the second, the Costa Concordia sinking last January, was a cautionary signal of how quickly and easily catastrophe can occur even in this day of enhanced navigation aids.

Remarkably in the Costa Concordia case, the loss of life was not on the same scale as the Titanic. This is in many ways due to the improvements in passenger ship safety over the intervening 100 years. Nonetheless, the event has drawn a lot of attention to the state of risk management and accident-prevention in the industry.

History Even leaving aside wartime losses, the Titanic was by no means the greatest maritime tragedy of this past century. That dubious distinction belongs to the MV Dona Paz, in which 4,341 people lost their lives in a collision with a gasoline tanker near the Philippines on December 20, 1987. The century is in fact distressingly full of peacetime marine disasters approaching or exceeding the Titanic’s losses: the Toya Maru was lost in a typhoon in 1954 with 1,153 persons; the La Joola, a Senegalese ferry, capsized in 2002 with more than 1,800 passengers onboard;

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...the increasing numbers of people travelling recreationally might lead one to expect that the likelihood of casualty is increased. But what do the statistics say about trends in the passenger-shipping industry?

and the Al Salaam Boccaccio 98 sank in the Red Sea in 2006, taking with her more than 1,000 souls.

There are even some salient examples in home waters: the Empress of Ireland, lost to collision in 1914 in the St Lawrence River with 1,012 lives, and the Princess Sophia lost in 1918 on Vanderbilt Reef in Alaska, with 353 lives, the greatest maritime disaster in the Pacific Northwest to date. Another one, in which similar losses were averted, was the burning and sinking of the Prinsendam in the Gulf of Alaska in 1981. Miraculously in this last case, the entire complement of 510 passengers and crew was saved.

This brief, incomplete, record of maritime disaster in the last 100 years might suggest to some that sea-travel is still hazardous. The examples chosen illustrate the full range of shipping risks: storms, capsize, fires, groundings, collisions, and hazardous cargoes. Nor are the majority of these during the earlier part of the period; many of the more shocking examples are comparatively recent. Indeed, the increasing numbers of people travelling recreationally might lead one to expect that the likelihood of casualty is increased. But what do the statistics

say about trends in the passenger-shipping industry?

Trends In the hundred years since Titanic, the world fleet of ships has tripled in number to over 100,000 ships, for a total tonnage of more than a billion.

Many of these ships are significantly larger, especially cruise ships; while Titanic carried a total complement of 2,224, cruise ships now routinely carry 3,000 while the largest ships carry up to 7,500 persons.

In 2011, the passenger-carrying component of the world fleet totalled 4,131 ships of over 300 gt, a combined gross tonnage of 34.8 million. Of this total tonnage, 47 per cent was comprised of cruise ships. Notwithstanding the recent additions of large cruise ships, the passenger fleet is the oldest component of the total merchant fleet, with pure passenger and passenger/ RO-RO ships averaging 21 and 24 years of age respectively. Over 1,600 of these ships were older than 25 years, while between 21 and 26 per cent were built in the last 10 years. The larger passenger (cruise) ship segment is the youngest part of the fleet, with all ships of over 100,000 gt being built in 1998 or later, and 15 more of over 80,000 gt February 2013 BC Shipping News 35

PASSENGER VESSELS

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Notwithstanding increases in the world fleet, the overall rate of ship losses has decreased over the century from one in100 per year in 1912 to one in 670 per year in 2009.

being on the order book as of 2011.

Capacity of the cruise industry alone in 2013 is estimated to be over 238,000 berths in 282 ships. With ships on order, this is expected to increase for a projected total annual cruise population of over 23 million by 2015. The demographics in the cruise sector reflect an older, largely retired passenger, with 36 per cent of age 45-59, and 35 per cent over 60, which could create concerns for mobility in evacuation.

Notwithstanding increases in the world fleet, the overall rate of ship losses has decreased over the century from one in100 per year in 1912 to one in 670 per year in 2009. Some claim that cruising by sea is one of the safest modes of transport, with only 28 fatalities due to operational causes

36 BC Shipping News February 2013

(ie: fire, collision, grounding or sinking) in the decade before the Costa Concordia incident. This equates to 0.16 fatalities per million passengers, a rate about half that attributed to airline travel. However, others point to selective statistics to challenge this claim.

Whatever the truth, it is clear that safety remains a key concern of the travelling public and a primary responsibility of the industry.

Safety changes, continuous improvement‌ In fact, many changes have taken place to greatly enhance passenger safety and comfort. These changes are both technical and operational, with a very high premium being put on continuous improvement across the industry.

The Titanic incident itself was followed closely by an international convention to establish standards to improve the safety of seafarers and passengers. Since 1914, the Safety of Life at Sea Convention (SOLAS) has specified appropriate standards for live-saving equipment, ship construction and survivability, navigation equipment and practices, and communications. In recent years, SOLAS and related conventions have further detailed codes to deal with Dangerous Goods Carriage, Safety Management Systems, and Ship and Port Facility Security in response to evolving concerns.

Navigation (in the comprehensive sense of good geographical positioning as well as collision-avoidance) has also been an area of significant improvement over the past century. The institution of the International Ice Patrol, to track and warn ships of iceberg hazards in the North Atlantic, was another outcome of the initial SOLAS convention. The later development of radar helped in this particular task, as well

as facilitating collision avoidance and landfall. The Second World War also enhanced navigational precision with the subsequent development of electronic positioning aids such as Consol, LORAN, and OMEGA. Nowadays, we take it for granted that ships can know their position within metres, continuously, and in all weather, thanks to GPS and inertial navigation systems. Recent additions to navigational aids include AIS, such that the position, identification and course/speed of unseen vessels in one’s vicinity can be ascertained directly from their own transmissions.

And in addition, most of the more heavily travelled sea lanes are overseen by Vessel Traffic Services, which impose another layer of oversight, warning and guidance to shipping.

The human end of the safety-atsea equation has also been addressed over the years. The 1978 Convention on Training and Certification of Watchkeepers (STCW) generated common, appropriate and compatible standards for certification of seafarers.

Enforcement was aided by the publication of a “White List,” thus identifying by omission those countries whose seamen might be subjected to more stringent flag or port-state inspection. This effort at global professionalization of the marine industry was incentivized by many players, be they governmental, legal, technological, economic or professional interests. The Nautical Institute is a key player in this from its

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PASSENGER VESSELS It is therefore timely and appropriate that the spring conference of the BC Branch of the Nautical Institute will be devoted to the topic of Passenger Ship Safety.

London base, providing input to the continually evolving conventions of the IMO and publishing a wide range of educational publications across the maritime domain.

With all this effort to promote, program and regulate the safety of global shipping, it would seem that there is no room for human or technical mishap. And yet, accidents continue to happen. Why is this? There are many reasons that accidents transpire and the whole science of accident causality, human failure and risk management is not just another article, but a library in itself! Suffice to say at this point that accident prevention requires not just post-facto investigation, but a sustained effort at self-examination and continuous improvement, as well as a generous spirit in sharing best practices.

Conclusion It is therefore timely and appropriate that the spring conference of the BC Branch of the Nautical Institute will be devoted to the topic of Passenger Ship Safety. The very topical nature of this subject may be indicated by the fact that a Google search of just this term yields 2.48 million hits!

The conference will take place in Victoria, at the Marriott Hotel, on May 9 and 10, 2013.

Through involvement of all sectors of the passenger-carrying marine industry, from whale-watching to mega-cruise ships, and from eco-tourism to major scheduled ferry services, the conference will examine how the industry is proceeding by continuous improvement to provide a safe experience for the travelling public. This will include discussion of both operational and technological aspects and innovation, providing value for widely varying interests.

More information can be had by accessing the conference website at: www.nibcconference2013.com.

Subsequent articles in BCSN over the next few months will further elaborate on the scope and agenda of this important conference.

Nigel Greenwood is a retired RearAdmiral RCN, a Master Mariner, and a member of the Nautical Institute. He consults in the maritime industry from Victoria, and at: www.GreenwoodMaritime.com.

Passenger vessel safety is the focus of the upcoming conference of the BC Branch of the Nautical Institute. Details can be found at www.nibcconference2013.com.

(Photo credit: BC Shipping News.)

February 2013 BC Shipping News 37

It is insured for “all risks”...mostly

By W. Gary Wharton

A lawyer with Bernard & Partners

I

t is a common misconception that an “all risks” marine insurance policy covers “all risks”. It is a fundamental tenant of marine insurance that the loss must have been caused by an unforeseen or fortuitous event – not by something inherent in the nature of the object insured. If the nature of the thing insured, or normal and expected events, would lead to a loss, the insurance does not respond. In cases where the cause of the loss is clearly established, one can usually ascertain whether such cause was fortuitous or inevitable. In cases where the cause or the characterization of the cause is open for debate, the question then becomes: on whom does the burden of proving the fortuity of the loss fall?

As marine insurance lawyers have been grappling with such concepts for a couple of hundred years, one would normally assume that these things have been long sorted out. However, a recent case which has made its way through the Federal Court, the Federal Court of Appeal (and further leave sought to the Supreme Court of Canada), demonstrates that such fundamental concepts still provide grist for the marine insurance mill.

The case in question is Feuiltault Solution Systems Inc. v. Zurich Canada, which was handed down by the Federal Court of Appeal on July 30, 2012. The facts established at trial were that Feuiltault had manufactured and shipped three containers of

38 BC Shipping News February 2013

book binding machinery to Germany.

Upon delivery, the consignee refused to accept the machines as they arrived rusted and were later declared a total loss. Feuiltault called upon its insurer to make good the loss under its “all risks” policy and the underwriter refused.

The trial Court had determined that the corrosion was caused by condensation in the containers from wet, pressure-treated wood dunnage. The Court found that Feuiltault had failed to prove unusual or untoward weather or the fortuitous ingress of water or a corrosive agent. The Court also failed to draw an inference from the fact that previous shipments had arrived undamaged, as this was the first instance of the use of this type of dunnage. The Court held that Feuiltault had failed to discharge the burden of proof upon it to show that the loss was fortuitous.

Further, while subsequent shipments of the machines were plastic wrapped, the machines in this instance were not wrapped. The Court concluded that the exclusion for “insufficient or unsuitable packing” also applied and the claim by Feuiltault was dismissed for this reason as well.

Following the decision, Feuiltault appealed.

The Federal Court of Appeal held that the Trial Division erred in law in imposing on the insured the burden of proving that the loss was caused

by a fortuity. In doing so, the Court of Appeal found that the trial judge failed to give effect to the whole of the contract between Feuiltault and its underwriter.

The Federal Court of Appeal analyzed the issue of burden of proof and highlighted a somewhat ironic conclusion. The Court held that, where the question of coverage falls to be decided solely on the scope of the insuring agreement, and in the absence of any stated exclusions (such as inherent vice, wear and tear or deliberate acts of the insured), the burden falls upon the insured to show that the cause of the loss was fortuitous. However, where the question of coverage depends on both the insuring agreement and stated exclusions within the agreement, judicial authority supports the conclusion that, where the insurer specifically and expressly excludes certain non-fortuitous losses, especially inherent vice, then the insurer must be taken to have accepted the burden of proving that lack of fortuity.

In the situation where there are no stated exclusions, such as inherent vice, the insured, by having to prove that the loss was caused by a fortuity, by necessary implication, is required to prove that the loss was not due to a non-fortuitous event.

The Federal Court of Appeal determined that, where the insurer specifically and expressly sets out excluded non-fortuitous losses, “the only way to

give both the insuring agreement and the exclusions their proper scope, is to hold that the insured under an ‘all risks’ policy need only show that the cargo was in good condition when the insurance attached and that the goods were damaged while the insurance was in force.” The burden then passes to the insurer who wishes to deny coverage to prove that the exclusion with respect to inherent vice or some other non-fortuitous loss applies.

As the underwriter did not plead that the loss was caused by a nonfortuitous loss, i.e., inherent vice, the only remaining issue was whether the exclusion for insufficiency of packing relieved the underwriter of liability under the policy.

This issue then raised the question of whether the insufficient packing (the dunnage with high water content and the unwrapped cargo) was in existence before or after the attachment of the insurance. If the insufficient packing was in existence prior to the attachment of the insurance, it would be considered as an existing characteristic of the thing insured. However, if the insufficient packing occurred after the attachment of the insurance, the subsequent use of inappropriate dunnage could constitute a fortuity which would bring it within the ambit of “all risks” and the exclusion would not apply.

In the case of Feuiltault, the contract of insurance provided that the insurance attached from the time the goods left the warehouse for the commencement of the transit and it was common ground that the containers were packed with the inappropriate dunnage at the insured’s premises prior to being picked up for transportation to the Port of Montreal and onwards. While the absence of protective wrapping did not “of itself” cause the loss, such lack of wrapping did contribute to the loss so as to satisfy the requirement of the exclusion.

In the final result, the Federal Court of Appeal upheld the Federal Court’s conclusion that the packing was unsuitable and that such unsuitable packing was the cause of the loss and the underwriter was still not called upon to pay.

Leave was sought to the Supreme Court of Canada to have the

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legal affairs

In the situation where there are no stated exclusions...the insured, by having to prove that the loss was caused by a fortuity, by necessary implication, is required to prove that the loss was not due to a non-fortuitous event.

highest Court’s view on the issue but the Supreme Court of Canada denied such leave.

It is somewhat counter-intuitive that an underwriter, by expressly stating the exclusions that apply in the situation of an “all risks” policy, actually makes it more difficult for the underwriter to rely on those exclusions. However, by relieving the insured of the obligation to prove that the loss was fortuitous, such is actually the case. The Federal Court of Appeal viewed this approach as “an incremental advance” based on the principle set out in Arnould’s Law of Marine Insurance and Average that, “If goods are shipped sound and arrive damaged, and the damage is of such a kind as to raise

a presumption of some external cause, there is, under an ‘all risks’ policy, prima facie evidence of loss by an insured peril.

The burden is then on the underwriter to prove that the loss in fact occurred in some way for which it is not liable.”

The message for those insuring their goods on an “all risks” basis is that “all risks” does not necessarily mean “all risks” but only those non-excluded perils which can be considered as fortuitous. The burden of proof in respect of such will be dependent on the wording of the policy in question.

W.Gary Wharton is a maritime lawyer and partner with Bernard & Partners in Vancouver, B.C. and can be reached at wharton@bernardpartners.com.

February 2013 BC Shipping News 39

Pipeline wars: Who speaks for shipping?

By Michael Davis

Managing Director, Reputations

I

have been watching the Enbridge Northern Gateway — and now Kinder Morgan’s Trans Mountain — pipeline debate for over a year now.

To me, it has been a year of pipeline industry denial and bungling; of heavyhanded government and a complete misreading of public sentiment by all.

From the marine sector: ringing silence other than some preaching-tothe-choir moments inside the halls of industry.

Make no mistake; this debate is not just about tankers. In December, we saw the focus switch briefly to bulk coal carriers after the accident at Westshore’s Roberts Bank Terminal.

“This really is coal’s Enbridge moment,” cried one environmentalist.

What could be done differently? How can the shipping sector improve what is rapidly becoming a debilitating liability: its public image?

In a previous life, I was a towboater, and have sailed this coast from Seattle to Alaska, first in tugs, then powerboats and now a classic sailboat. I have sailed ‘round Princess Royal Island, sat in the hot springs in Douglas Channel, rode out storm-force winds in Trollers Lagoon just off Estevan Sound, and made the jump across Hecate Strait from the top of Principe Channel. I know and love this coast.

I admit to being conflicted on the Enbridge proposal. A spill terrifies me.

The area is known for tricky navigation, a lack of support resources and wild weather. Human mistakes compound, causing tragedies: the Queen of the North still sits in the deep waters off Gill Island, bubbling up contaminants,

40 BC Shipping News February 2013

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Make no mistake; this debate is not just about tankers. In December, we saw the focus switch briefly to bulk coal carriers after the accident at Westshore’s Roberts Bank Terminal.

seemingly deserted by owners and regulators.

I know there have not been any tanker spills in B.C. and spills elsewhere have decreased significantly with new equipment, training and laws. But the emotional aspects of the environmental campaigns are compelling, and the shipping industry ignores them at its peril. I am much more engaged than the average person, much more knowledgeable on shipping issues, yet I do not feel I have enough information to judge risk against benefits.

My profession is Public Relations.

We do stakeholder and media relations, crisis and issues management. I have run award-winning campaigns on contentious issues: Insite (the supervised injection site), Walmart and others. In my opinion, Enbridge has made colossal communications mistakes, the most glaring being a complete misread of public sentiment. This was not a sudden crisis, but a building issue ignored over a long period of time.

Kinder Morgan’s proposed twinning of the Trans Mountain Pipeline appears to be having an easier go, but is also headed for troubled waters. While media coverage has been milder and the opposition less vocal, there are disturbing signs: opponents have come together in overflowing town hall meetings. Vancouver Mayor

Gregor Robertson is vehemently and publically opposed and Burnaby Mayor Derek Corrigan referred to Kinder Morgan as the “Keystone Cops” during the 2007 spill in Burnaby. The TsleilWaututh Nation across Burrard Inlet is also firmly opposed to the twinning. Opposition appears co-ordinated, motivated and growing.

In some ways the pipeline company’s stumbling approach to these projects is understandable: pipelines have historically flown under the radar. But the world has changed and B.C. is different. I believe Northern Gateway is the Lyell Island, the Clayoquot Sound and the ‘war in the woods’ of this generation.

The environmental review process is now irrelevant, other than providing additional fodder for the media. The process lost all credibility when the federal government passed legislation allowing it to simply overrule a negative ruling. So the review is now — officially — window dressing.

And regardless of the review panel’s approval — or government’s — you will have mothers and sons, grandmothers and grandchildren laying down in front of bull dozers or being carted off to prison, all playing out on our nightly news, just as it did during the 1980s’ War in the Woods. What investor has the stomach for that?

There are many issues wrapped up in this public debate. Northern Gateway and Trans Mountain have become proxies for a slew of discussions that many feel have had no public forum for debate: climate change; the Great Bear Rainforest and the broader protection of our coast; perceptions of economic colonialism and bullying by the United States; the balance of environment and jobs; the cost of economic development and who benefits from that development.

Much as it may frustrate those in the technical professions, teasing out the separate components of this debate — i.e., trying to isolate the technical discussion from the emotional pictures and the fears they evoke — is no more possible in the minds of the general public than it is to separate the threads of a fine textile and still feel the warp and weft of the cloth. To win the debate, industry must speak to the fears and the hopes just as they speak to the studies and the numbers.

The players in this drama both feel they are at a disadvantage. The enviros see themselves as the underdogs, without the resources of industry, without the ear of government, generally tarred with a broad brush that they are opposed to everything. They feel their issues are swept aside every time the economy takes a dip.

Industry bemoans its bad boy image.

It is regularly caught flat-footed, surprised and then annoyed at the public’s misguided interference and their ignorance of the ‘real’ issues. It seems fractured, with each player pulling for their own little piece of the pie. Industry counts on the officials of power and is constantly gob-smacked when unofficial forces — granny in the woods — derail their multimillion dollar projects.

And from the marine industry, that ringing silence. In fairness, the marine industry is also accustomed to flying under the radar. They don’t often need the public’s awareness or approval, only that of the regulator or the minister who already knows how important shipping is and will support — so long as they feel they have permission from their constituents.

So the marine sector is rarely in the public eye. Only disaster makes it into

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pipeline projects What can the marine sector do differently? How can it turn this discussion around before it impacts jobs, investment, regulation and profitability?

the mainstream news. All Joe Public sees is the tanker spewing oil and the pathetic birds dying in goo. We who know the industry protest against the unfair portrayal and wonder why, when we come to controversy, perceptions are so negative. Well, what else have they seen? What other images have been offered? What positives have we given them?

What can the marine sector do differently? How can it turn this discussion around before it impacts jobs, investment, regulation and profitability?

The sector must begin to communicate strategically. It must take a long-term approach to improving its reputation — and capture some short-term wins along the way.

A strategic approach would first consider the sector’s stakeholders. Defined as those who are impacted by, or can impact the sector, the list is very long, but they can be weighted and sorted into high, medium and low impact.

And let us not ignore those ‘unofficial’ stakeholders that seem to leap out of nowhere. A process called the Stakeholder Salience test rates each group by power, legitimacy and urgency. It is the last that trips up corporations. A single mom, highly motivated, with social media and the press, can change the public discussion, derail decades of planning, cost millions and change the political landscape.

With stakeholders identified, we can grapple with what we need to communicate to them. What is the ‘desired reputation’ the sector needs to reach its goals? What are the components of that reputation and how do they differ from stakeholder to stakeholder? How can they be brought into alignment across various groups?

Having defined the desired reputation and the stakeholders most important to us, we can test that reputation with the people who actually hold it: the stakeholders. Reputation exists in their minds. We can influence, we can

build, but we cannot control. Our reputation resides with them.

Polling can test these perceptions and help us plan how to address the gaps between our desired reputation and the actual one we have with our stakeholders. Now we can focus our efforts. We can build a strategic communications plan: identify the channels of communication; craft our key messages. We can communicate the benefits of our industry to each of those groups whether it is employment opportunities, economic opportunities or the benefits of shipping that support all our lifestyles. We can begin to build a bank of knowledge and goodwill that will smooth discussions with regulators, improve relations with politicians, and build relationships with media.

All of this goodwill and these relationships come into play when accidents happen. It will not excuse negligence, but it will help communication in difficult times. People will be more prepared to give the benefit of the doubt.

This communications strategy cannot stand in isolation. It must be part of the overall direction of the sector. It must reflect the realities of how the sector operates. In other words one must plan, do and talk in sync if the campaign is going to be seen as authentic.

These are longer term strategies, but short-term wins can run alongside them. Identify industry spokespeople and train them to engage with the mainstream media. Pro-actively put them out as subject matter experts, building media awareness of them and their credibility. Look for opportunities to engage, rather than turtling and hoping for the best. Work out the messages; research the supporting facts; present the sector’s story in a concise, relevant way.

Communications must also be in the right tone. I don’t know about you, but when I think of oil pipelines, my mind does not naturally go to soft pastel February 2013 BC Shipping News 41

pipeline projects

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This is a vibrant, tough, energetic sector that contributes a lot of jobs, money, taxes and opportunity to the B.C. economy. Let’s speak like that.

colours, chirping birds and banalities about pathways to our future.

The shipping sector needs to speak in a voice that is authentic to it. This is a vibrant, tough, energetic sector that contributes a lot of jobs, money, taxes and opportunity to the B.C. economy.

Let’s speak like that. Let’s engage in the discussion. Let’s be creative and take some risk, and not speak in the “Your call is important to us” corporate tone. Figure out what is important to the population and have a real conversation.

Whether the sector is in it or not, that conversation is taking place. A very short search of the internet turns up this partial list of organizations and sites: • www.tankerfreebc.org — A blog style site with a petition (1,587 signatures when I checked) calling on “Parliament to create a permanent ban on crude oil tankers on the coast of British Columbia.” From the site: “Tanker Free BC was founded in 2010 by a group of concerned citizens who discovered that tankers loaded with tar sands crude were passing through Vancouver Harbour.”

• http://defendourcoast.ca — tied to

42 BC Shipping News February 2013

•

•

•

•

the recent demonstration on the lawn of the legislature, it is unclear who runs this, but there is an impressive list of ‘endorsers’. http://dogwoodinitiative.org/notankers — says its anti-tanker petition is close to 100,000. The Dogwood Initiative believes “British Columbians should have the right to make their own decisions about how the land they live on is used”. htt p://pacif ic w i ld.org /site/ou rwork/no-tankers-no-pipeline.html — Pacific Wild is “committed to defend wildlife and their habitat on Canada’s Pacific coast by developing and implementing solution-based conservation strategies.” http://notankers.org — Hard to figure out who is running this site, but they show links to the Wilderness Committee, Tanker Free BC, BCWaters.org and a host of other environmental activist organizations. http://canadians.org/energy/issues/ pipelines/index.html — The Council of Canadians, who “work to protect Canadian independence by promoting progressive policies on fair trade,

clean water, energy security, public health care, and other issues of social and economic concern to Canadians.”

I am sure many readers of this article have opinions about these organizations, their tactics and their interpretation of the facts. But if the shipping sector is not even in the public debate, the anti-shipping organizations win by default.

Will any organization or person champion the shipping sector? Who will lead? And who will fund? The conversation is going on all around us. If we do nothing, then we allow others to define the issues, define right and wrong.

I do not claim to know what the right decisions are on Northern Gateway or Trans Mountain. But I do know this will not go well for the shipping sector if we do not begin to talk about the benefits of the work the industry brings to society; if we do not bring some facts and some context to the scare mongering espoused by some groups.

Nor can we expect politicians to defend us. I know of no politician that will stand against the flood of public opinion if no one from the sector is standing there with them, along with a good number of the general public.

There are proven strategies and tactics for strong communications campaigns that effectively engage the public. But it is up to the shipping sector to stand up for itself. To decide who — if anyone — will speak for shipping in B.C. Michael Davis is the Managing Director of Reputations, one of western Canada’s leading Public Relations and Reputation Management firms. An award-winning strategist, Michael has experience in the design and implementation of reputation management campaigns and juggling the needs of complex multi-stakeholder projects. He has been recognized for excellence in his field with numerous national and international awards.

Michael is a Trustee for the Vancouver Maritime Museum and chairs their Strategic Planning Committee. He is on the Board of Directors of Family Services of Greater Vancouver and Board Voice, and is active in all levels of Canadian politics.

Michael can be reached at mdavis@ reputations.com

Trends in the container ship leasing industry

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By Syd Heal

T

he world fleet of about 5,000 container ships is in a continuous state of flux as old ships are replaced with new and new crises take the place of something older that is always present in one form, or another, with some owners prospering while others wither and die. Of the world fleet no less than 1,800 are owned by German owners and of these, between 500 and 700 are facing liquidity challenges — 100 have already gone bankrupt. A culprit in the equation appears to be the device known as a “KG company”, which is primarily an investment vehicle that provides a valuable tax shelter. It was developed under German tax rules to attract surplus capital funds of high-earning people and some corporate investors whose prime concern was to minimize taxes while they relied on professional managers to look after the ships for them. As a result some large fleets were assembled and some big management companies grew out of them, but there must be a considerable number of unhappy investors today who were originally dazzled by all the taxes they were sheltering at the same time as they did not have a full realization that shipping markets go down as well as up. When the market went down, the investors could well be paying short-fall contributions instead of dividends!

We had a similar arrangement here when the forest products industry was expanding in the 1950s to 1970s and the tug and barge business was panting to keep up with its needs. Many

What might be termed the 2012 recession wave is now spreading out from Europe, collectively China’s best customer group, and has resulted in a concurrent weakening in demand for Chinese imports...

of the new barges built in local yards were financed using the formula available under the Canadian tax act which had the same effect as the German KG. Happily, very few if any of the Canadian investors got burned.

Most of the KG ships have been employed on short-term charters on secondary routes to a variety of charterers. Some act as feeder vessels to the large liner companies serving secondary routes where the traffic is lighter and others among the larger types have supplemented major liner routes when there has been a need to temporarily engage more tonnage.

The main German liner operators are Hapag Lloyd, Hamburg-Sud Amerika and Rickmers. All three are in the long distance trades, for the most part utilizing bigger ships than most of the KG vessels and, where they lease, they follow the pattern of other international lines and generally take ships on longer term charters with one or more optional extensions. Among European countries, German leasing companies like Nord Capital, Niederelbe and Red. Klaus-Peter Offen have the lion’s share of the European ship-leasing market to the large international liner companies.

In North America, outside of domestic carriers like Matson and Horizon, the bulk of the companies quoted on the NYSE and NASDAQ exchanges are foreign-based internationals usually taking advantage of Marshall Islands registration and stock flotation on the two exchanges. Most of the longterm loan capital has been arranged in Europe, but this is now severely restricted, if not unavailable entirely.

This has, of course, meant a drying up of mortgage funds to all but those with the strongest covenant and when that happens other means have to be found. It is when conventional finance sources weaken that operators float more shares on the stock markets and leasing companies with a strong cash position do their best business in providing ships on long leases to their liner customers.

That may be conventional wisdom but so substantially has the recession of 2008 weakened international trade it is a situation that is still with us in a second wave of recession. What might be termed the 2012 recession wave is now spreading out from Europe, collectively China’s best customer group, and has resulted in a concurrent February 2013 BC Shipping News 43

Photo credit: Don Brown

containers

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The COSCO Prince Rupert (8,500 teu), a Seaspan Corporation container ship on charter to China Ocean Shipping Company.

A horse of a different colour to the ship-leasing companies mentioned above is Ship Finance International Inc. (SFI), a Bermuda-based company within the orbit of former Norwegian owner, John Fredriksen.

weakening in demand for Chinese imports and a further over tonnaging on the key Asia-Europe trade routes.

Almost all the top liner groups, with a few exceptions like Hamburg-Sud and the Chilean company Compania Sud Americana de Vapores (CSAV), participate on this route and none more so than Maersk, the largest international liner operator. Maersk has led the way in enlarging the size of the biggest container ships afloat which causes its competitors to follow suit and this in turn aggravates the over-supply situation even further. It is perhaps appropriate that Maersk also leads the way in lay-ups with 21 of its ships tied up and others chartered in from investing owners being returned as fast as legally possible given the nature of charter contracts.

The biggest of the U.S.-listed ship leasing companies by fleet size and container capacity is Seaspan Corporation with its start-up roots in Vancouver where it manages its fleet, with Marshall Island registry 44 BC Shipping News February 2013

and operational headquarters in Hong Kong and crew procurement mainly in Mumbai. For the first time since it was established, no new ships are expected in 2013 so even the liner operators are going slow on leasing as an alternative to ownership.

Costamare and Danaos, both Greekcontrolled ship-leasing fleets follow the same pattern as Seaspan with their chartering out policy. Costamare is a family-controlled company that was the last one of the current listings to come to the stock market. It has a reputation for tight and profitable management and ranks third in fleet size.

Danaos on the other hand was under great pressure from its bankers during the recession that started in 2008, but now seems to be recovering from that as it has built a big fleet of modern vessels second only to Seaspan.

The trend to super-sized ships continues. CMA-CGA, the Paris-based international has just brought into service the largest container ship now in commission, the CMA_CGA Marco

Polo. It is the first of three new 16,000 teu sisters to be built by Samsung for the Europe-East Asia route. CMA-CGA has a closely related British-based container ship-leasing operation, Global Ship Lease Inc., which is listed in New York. It owns about 18 container ships which are all leased to the CMA-CGA group. The new ships are planned for British registration, so it will be interesting to see if any of this new trio become owned through Global Ship Leasing for lease back to CMA-CGA. A horse of a different colour to the ship-leasing companies mentioned above is Ship Finance International Inc. (SFI), a Bermuda-based company within the orbit of former Norwegian owner, John Fredriksen. After a quarrel some years ago with the Norwegian government, Fredriksen took up Cypriot nationality and controls companies through a variety of holding companies and cross investments. His main operating company was tanker owner Frontline, but like most of the tanker market it is panting for a respite from low rates and lots of red ink. SFI owns a large fleet of 70 vessels made up of double-hull tankers including about 20 VLCCs, dry bulkers, drill rigs and offshore supply vessels, car carriers and 18 container ships. About the only categories missing are cruise ships and LNG tankers.

It is doubtful if there is a more diversified fleet in this size category in the Western world and its strength shows through in its consistent profitability. Its container fleet is interesting and shows signs that it is entering a new growth pattern. It took a blow when six 2,700 teu ships were returned to it following the bankruptcy and reorganization of the American liner operator Horizon Lines in 2011. Since then, SFI has added two five-year-old 13,800 teu units under long term charter to CMA CGA and four 4,800 units under construction for long-term charter to Hamburg-Sud. Both investments are indicative of the trend to lease long term when liner operators have a need to conserve working capital through tough times. With a strong financial base and a fleet this size with strong indications of further growth it has to be reckoned with and included when

containers Photo credit: Don Brown

considering the leasing fleets and the substantial percentage of ownership that can be attributed to them.

Given the competition on the Europe-Asia route and the huge tonnage that is already trying to live off it, one can’t avoid shaking one’s head at the huge ships that are coming into service in this trade – 13,000 teu sized ships are now common and are forcing smaller units into the more minor trades, while Maersk has plans for 18,000 teu ships. The end result is that the smaller ships from say 1,800 to 4,000 teu are crowding the waterways with many laid up and, as noted earlier, an increasing number of bankruptcies. Just the same, new opportunists continue to enter the field with a number of bulk carrier fleets retaining a container ship component. Another trend is the emergence of bulk carrier companies spinning off fresh vehicles for owning container ship fleets that clearly are purchased from liner operators with a reasonably lengthy ongoing time charter. The process works for the liner operators who free up capital for investment in the technically more efficient and economical new, larger container ships now coming into service. Remarkable economies have been achieved in fuel consumption with improved engines supplemented with new hull coatings with longer life and better water flow characteristics.

Two such newcomers are Box Ships Inc. a spin off from Paragon Shipping with a fleet of nine such vessels in the 3,500 to 5,000 teu range, and Diana Containerships Inc., a spin off from much-respected Diana Shipping with a similar sized fleet, on average slightly larger than the Box Ships vessels. Of the two, Diana Shipping is regarded as one of the best of the Greek-listed fleets and to conserve assets it stopped paying dividends in 2008 and now has liquid reserves of almost a half billion dollars. Generally, it seems likely that such companies as Paragon and Diana, with their long experience of short-term time chartering of vessels in the bulk carrier markets, may be temperamentally well-suited to operating in the secondary container ship market. For Seaspan, short-term chartering is a field in which it has had less experience and it will be

The Bilbao Bridge, a Seaspan Corporation lease to Kawasaki (4,500 teu). interesting to see how well they handle this new function as older vessels in the fleet come off their 10-12 year charters in a steady stream. One thing that is to their advantage is that such ships are fully paid for long before their initial long-term charters terminate. Another developing aspect is that the name Seaspan on their ships will increase on the world shipping lanes, for example CSCL Felixstowe has become Seaspan Felixstowe. The beauty of the long-term model developed by Seaspan for its charters, which has served it so well in building a big fleet, is that once set up with a first-class counter-party, things remain relatively stable for the duration of the charter, but with short-term chartering

it becomes little different to running a tramp operation with constant volatility in re-chartering as short charters roll over with frequency.

A footnote to this account is that B.C.’s second port, Prince Rupert continues to grow as a container ship port that justifies the faith of the city, local and senior governments as well as the Canadian National railway and the companies who now regularly schedule the port as a major trans-shipment point. May the trend continue as it makes all sorts of sense.

Syd Heal, a veteran of the marine industry and a prolific writer and publisher of marine books, can be contacted at: richbook@shaw.ca.

February 2013 BC Shipping News 45

ENVIRONMENT

Green Marine prepares to launch West Coast advisory committee Information session set for February 26

By Julie Gedeon

G

reen Marine — the Canadian and U.S. maritime industry’s environmental program based on measurable, continual improvement — is holding an information session in Vancouver on February 26 to explain the role of the organization’s soon-to-be-formed West Coast advisory committee.

“Regional input is a core aspect of the Green Marine program and it has always been in the plans to establish a West Coast advisory committee,” says Ray Johnston, Green Marine’s president. “Now that we have the critical mass on the West Coast in terms of members, we’re eager to engage the

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“Regional input is a core aspect of the Green Marine program and it has always been in the plans to establish a West Coast advisory committee,” says Ray Johnston, Green Marine’s president.

regional marine industry, government, academia and NGOs in the organization’s decision-making process through direct, regional representation.”

The Chamber of Shipping of British Columbia, one of the 11 maritime industry associations that are members of Green Marine, is spearheading

the session’s organization. “Most — if not all — of the marine enterprises that have signed up for Green Marine so far are members of the Chamber,” notes Stephen Brown, the Chamber’s president. “And since Green Marine complements a lot of the work that’s being done the West Coast – such as the

GreenTech heads towards the West Coast for the first time

46 BC Shipping News February 2013

Photo credit: Port Metro Vancouver

T

he Green Marine team is already enthusiastically organizing GreenTech 2013, its annual conference on green technologies and innovation for marine transportation, to be held in beautiful Vancouver, May 29, 30 and 31. GreenTech 2013 will hold two full days of presentations focusing on real-life experiences, case studies or leading edge research that show how best practices, new technologies and insightful partnerships make a difference in the field.

Green Marine is a voluntary environmental program for the marine industry that encourages ship owners, ports, terminals and shipyards to undertake concrete actions that go beyond regulatory requirements aimed at improving environmental performance and sustainability.

This sixth annual conference will be a great opportunity to really find out what Green Marine participants, partners and supporters are doing in terms of reducing the marine sector’s environmental footprint. The conference will basically follow the structure that attendees have praised over the past five years.

Topics of broader interest will be addressed in general sessions, after which parallel sessions will be held for representatives of port authorities and terminal facilities in one conference room, and for the delegates from shipping companies in another.

GreenTech also offers great networking opportunities. There will be a commercial exhibition, and booths can still be reserved,

on a first-come, first-served basis. The opening reception will be held in the exhibition room. A technology forum will be held again this year. Since Green Marine’s inception, GreenTech has always been the ideal time to present Green Marine certificates to all of the companies participating in the environmental program. The Certification Ceremony will be held on May 30.

For more details and updates, including exhibition and sponsorship opportunities, visit the GreenTech 2013 website: http://www.green-marine.org/annual-conference.

ENVIRONMENT B.C. Marine Vessel Air Quality Working Group that the Chamber co-chairs with Environment Canada — it only makes sense to co-operate and capitalize on existing synergies.”

Representatives from ports, terminals, shipping companies and other marine transportation enterprises will be invited, along with other relevant stakeholders, such as environmental groups. “Before anyone decides whether to join this committee, it’s important to fully understand what Green Marine is, how it works, and the advisory committee’s purpose and responsibilities,” says David Bolduc, Green Marine’s executive director, who will lead the morning presentation at the Vancouver Club.

The information session will be the first opportunity for all of Green Marine’s West Coast members to gather Publication in the region.

“It will also give those BC Shipping News who are considering participation in Green Marine a chance to obtain dirIssue ect feedback from existing participants February to gauge whether the program would benefit them,” says Brown.

Size Jason Scherr,page the Prince Rupert Port Island (half vertical) Authority’s manager of environmental sustainability, is looking forward Deadline January 6, 2013 to sharing the port’s positive Green Marine experience. “As the first port to Features join Green Marine on the West Coast, we’re happy to discuss how Green  EDITORIAL FOCUS: Marine helped to Labour shape our sustain Industry Insight – Mark ability plan,” he says.

“In fact, we’ve Gordienko, ILWU Canada agreed Anderson: to play a IMO’s mentorship role for  Darryl Labour Code organizations that would like some  Captain Stephen Brown’s 2012 Green advice or assistance regarding Review/2013 Forecast Marine’s environmental improvement  DNV’s Shipping 2020 reviewed and verification process.”  Robert Allan: The Meander turns 80!The Prince Rupert Port Authority is  Marine family profile: The among 10 Green Marine participants Burchett Family that have agreedcommunications to be mentors. The  Tanker traffic: mentorshipbyprogram new par strategies Michaeloffers Davis, Reputations ticipants additional support in imple Syd Heal: Container Lease menting the environmental program Business by pairing them up with participants  RAdm Nigel Greenwood (Ret): Trends inwith Passenger Safety familiar the process.  Green Marine: Lead article Scherr expects theup advisory committo Green Tech tee’s focus on West Coast issues will build greater awareness in the region about Green Marine and, consequently, increase membership.

“Green Marine provides a great opportunity to get to know and work with others in advancing common environmental initiatives,” he says. “The Prince

Rupert Port Authority has already benefitted from the knowledge gained from our involvement in one of Green Marine’s technical working groups, as well as through general networking.”

Bolduc says the information session’s timing is ideal. “It will provide an opportunity for more West Coast entities to become familiar with Green Marine prior to our sixth annual Green Tech conference, which is being held in Vancouver this year starting May 29,” he says.

“After several years of steady expansion in terms of both membership and environmental issues, we’re taking a bit of a pause in 2013 to reflect on the Green Marine program’s long-term development,” he adds. “And, of course, we plan to extensively consult with our participants, partners and supporters in this process.”

The regional discussions will begin when the advisory committees for the Great Lakes and St. Lawrence areas each meet early in 2013 and once again

Endurable Designs

designs@ral.ca

M.Y. Meander

80 years a lady!

February 2013 BC Shipping News 47

Photo credit: Prince Rupert Port Authority

ENVIRONMENT

Peter Freeman, a Biology professor at Northwest Community College, and Jason Scherr, manager of environmental sustainability at the Prince Rupert Port Authority, do some harbour monitoring along with students hired by the port for the summer.

48 BC Shipping News February 2013

in the fall. “We’re also hoping that the newly formed West Coast advisory committee will meet twice in the year ahead,” Bolduc adds. “All of the regional advisory committees will play a key role in this reflective process.”

One of the questions will be whether Green Marine should remain focused on its present environmental priorities or expand its scope. The program’s current nine environmental issues relate to air quality, water quality, aquatic invasive species, community impacts, and garbage management.

“Do we want to include, for example, ship recycling, or perhaps underwater noise that might affect marine life?”

Bolduc says. “These are the kinds of questions that require regional input.”

Johnston says that Green Marine’s fundamental commitment to continuous, measurable improvement in environmental performance demands that the program itself undergo regular scrutiny.

“Green Marine’s continued success and expansion depends on it being responsive to the needs of different sectors in different regions and on serving a varied but motivationally connected membership,” Johnston says. “The regional advisory committees are essential to the process of discussing what works and what doesn’t, as well as areas for improvement.”

To find out more about the information session on February 26 or to request an invitation, please contact the Green Marine Secretariat at 418-649-6004 or info@green-marine.org

Meander…

80 years a lady!

By Robert G. Allan, P.Eng

I

n the annals of Robert Allan Ltd., there is no vessel more significant than “Meander”.

My grandfather, Robert Allan, with an impeccable sense of timing, commenced his independent private practice as a Naval Architect in 1930. As this was after the stock market crash of October 1929, I can only surmise that this must have been an act of desperation in the very toughest of economies.

In the absence of any other paying jobs in his field, it was also likely his only possibility to earn a living. In our family lore, there are stories of slim earnings in the early 1930s in the region of $100 to $200 per year. In 1933 however, he was approached by Mr. George Kidd, a prominent local businessman (obviously less affected by the depression) to design a luxury yacht, to be named “Meander”.

This was a major commission at the time, and lifted my grandfather out of both an economic and an emotional depression, and consequently paved the way for a further 80 years of our company success. Kidd was a fellow Scot, which undoubtedly had some influence in the selection of my Grandfather to do this work. He reportedly wanted a ship that would carry him anywhere along the Pacific Coast and ultimately to his ancestral home in Glasgow, Scotland.

Kidd was President of the Vancouver Power Co., and the Chairman of the Vancouver Board of Trade in 1934-35.

The vessel was built in 1934 at W.R. Menchions Shipyard in Coal Harbour, located just east of where the Bayshore

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Although there is no record of her cost...and an educated guess would be about $24,000. Regrettably, I do not know how much he was paid for this design, but from the same notes I expect probably about $400!

Original Watercolour by Bart Stockdill P.Eng (Robert Allan Ltd). From the Private Collection of R.G. Allan.

Inn now stands. Although there is no record of her cost, amongst my Grandfather’s papers are notes of cost estimates of very similar vessels, and an educated guess would be about $24,000. Regrettably, I do not know how much he was paid for this design,

but from the same notes I expect probably about $400!

The original design drawings for Meander still reside in our archives.

The originals are classic design drawings in India ink on pale blue waxed linen and the Inboard Profile & Plans February 2013 BC Shipping News 49

yachts

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It is a testimony to the skills of the designer and the shipwrights of the day alike that this venerable vessel was built with just four detailed drawings... bhp at 800 rpm, which has been in continuous service ever since.

Like many large yachts of the period, Meander was “impressed” by the Royal Canadian Navy in 1939 for coastal patrol duty, serving as HMCS Meander in the “Fisherman’s Reserve” during the Second World War. It is not clear how the Kidd family were compensated for the loss of the vessel, if at all, or if the vessel was returned to them at the end of the war.

Meander’s post-war life was documented briefly by Peter Vassilopoulis in Antiques Afloat: from the golden

age of boating in British Columbia in 1980 and also appears in the

Canadian Nauticapedia website (www. nauticapedia.ca) but the latter unfortunately has many inaccuracies. Further research provided the following results (hopefully accurate): • In 1945, Meander was sold to Pacific International Airways, an apparent subsidiary of Pan Am Airlines based in Alaska, but the boat’s log books show her owned by and operated for Mr. Edward Lowe of San Francisco who likely had the PIA connection. The Meander’s log books from this period show the yacht with the Lowes and their friends aboard cruising the coast extensively — from Alaska to San Francisco, but primarily in the Seattle-Vancouver-Gulf

Photo courtesy of www. nauti-capedia.ca

in particular has a mass of information detailing the construction, machinery and outfitting of the boat.

It is a testimony to the skills of the designer and the shipwrights of the day alike that this venerable vessel was built with just four detailed drawings: a Lines Plan, General Arrangement, Inboard Profile and Deck Plans, and a Midship Section.

The yacht was commissioned on April 24, 1934 — that date is significant as the design drawings are dated October 1933, indicating barely six months from start to finish of the vessel, a remarkable feat even by today’s standards. It was also noted by Bert Menchions in his memoirs that the shipyard crew made a serious concession in their mid-depression wages from $5 to $4 per day in order to get this rare bit of work. In the same vein, a June 1934 article in Harbour & Shipping magazine cites the boat’s operating costs at 23 cents per hour.

This classic double-ended yacht was stoutly built from the finest materials available: • Yellow cedar hull planking • Bent 2” x 3” white oak frames at 9” centres • Teak deck planking • Yellow cedar ceiling (inner planking) She is powered by a six-cylinder Gardner 6L3 diesel engine, rated at 102

Islands areas. It appears however that the vessel remained in Canadian Registry in spite of her American owner. Lowe was responsible for adding rolling chocks to the hull (crudely sketched into the back of the 1946 log book) and the extended canopy over the aft deck.

• In 1948, the boat was bought by Sydney & Walter Wilson and used as a charter yacht under the name of “Meander Charters Ltd.” • In 1950, Meander was bought by the United Church of Canada and from 1950 (or 1951) to 1963, Meander worked as the United Church Missionary Vessel Melvin Swartout II working up and down the West Coast of Vancouver Island, based initially out of Port Hardy until 1953 she was moved to Bamfield. The log books from this period show a busy life programmed around a multitude of Sunday Services: e.g., March 23, 1961: Morning Service - Ucluelet 11:15; Afternoon Service - Indian Village -3 pm; Evening Service - Tofino, 7:30 pm • From 1963 to1972, Meander was owned by Frederick Alexander Menzies of West Vancouver who operated her as a charter yacht.

On Mr. Menzies’ death, the yacht was bequeathed to his son Robert who appears to have sold it almost immediately.

• In 1972, Meander was sold to Art and Norma Clements.

The boat was purchased in 1975 by Hedley Rendell and Dennis Feroce.

It was Dennis who wanted the boat and he was helped by Hedley with the

HMCS Meander in the RCN livery, circa 1940.

50 BC Shipping News February 2013

Robert Allan (Sr.) and Robert F. “Bob” Allan circa 1956.

yachts

Dennis Feroce, owner of Meander since 1975, has maintained the vessel in a manner faithful to her original 1930s design. purchase through his company. For the past 37 years, Meander has been under Dennis’ care, and since 1995 her interior has been completely restored, greatly benefitting from the contributions of Dennis’ wife Jan Iliffe.

In compiling this story, I wanted to include some of Dennis’ reminiscences of what must include many adventures

in his years aboard Meander. Dennis is typical of many coastal storytellers — get him started and then just sit back and listen. He is a font of coastal anecdotes and stories so in the end there are too many to mention, but the role of Meander in Greenpeace colours was too intriguing to pass up and it didn’t take too much to persuade him to give

some of the details of those episodes.

Having bought Meander as a young man in 1975, Dennis needed to make some revenue from her and that consisted largely of chartering as frequently as possible. But these were the 1970s and Greenpeace was a relatively new presence on the coast whose philosophy of environmental protection appealed strongly to Dennis. In 1977, he offered the boat to Greenpeace as the Greenpeace IX and she soon lost her beautiful white hull to the rainbow colours of that organization. Photos of her in those days are unfortunately elusive.

In May of that year the Kitimat Pipeline Company, a consortium of 15 oil companies, hosted the annual conference of the North Central Municipal Association of Mayors. The mayors, with their respective entourages (about 250 people in total), were taken aboard the CP Steamship’s MV Princess Patricia to transit up Douglas Channel to demonstrate how safe this route might be for tanker traffic. Greenpeace strongly opposed the concept and, with the

February 2013 BC Shipping News 51

yachts

A 1:24 scale model of Meander built by 18-year-old Robert F. Allan (1933/34). support of many coastal native bands and fishermen, organized a maritime protest. Greenpeace IX led a flotilla that included the United Church Mission boat, Thomas Crosby 5, and a large number of coastal fishboats.

The scenario that evolved is well described by Rex Weyler in his book Greenpeace: The Inside Story. Weyler describes a tense standoff when Dennis moved Meander into the path of the oncoming Princess Patricia and radioed to the cruise ship captain that Meander was “dead in the water”, legally placing responsibility on the larger ship to avoid a collision. While Dennis backed out of the captain’s way at the last minute, the scene had already captured the attention of the mayors’ delegation and media onboard the Patricia.

Dennis’ recollection of events was somewhat less dramatic than Weyler’s, but no less colourful, and he described the meeting of the two ships in the fog as almost accidental as they had not

known exactly where Princess Patricia was at the time. This caught Greenpeace unprepared for their act of formal protest, so they hastily launched balloons as the Patricia bore down on them.

Regardless, the protest had the right effect and the blockade created the awareness that effectively stopped the planned tanker route into Kitimat. It is not difficult to imagine similar blockades taking place in the near future as the contemplation of major tanker routes continues for B.C.’s North Coast.

Dennis also recollected when shortly thereafter Meander was chartered to take Thomas Enders, then the U.S. Ambassador to Canada (1976 to 1979) on a trip to Haida Gwaii as part of the process of educating various politicians about the true nature of the B.C. North Coast and what a serious threat an oil spill would present. Dennis described the hilarity of the patrician Enders being put ashore on Graham Island, clutching his briefcase as he

was presented with raw oysters off the beach for lunch, and an earful from Gary Edenshaw and others about the sanctity of those islands.

Dennis still lives aboard Meander with his wife, Jan. For many of the last 30 years, Meander has been operated as a charter yacht, but has also been their cozy and comfortable home.

The 1975 purchase was a fortuitous thing for Meander as Dennis, a Master Woodworker, has maintained her in absolutely pristine condition and most importantly, maintained her in a manner faithful to her original 1930s vintage design. Jan has lent a very talented decorator’s touch to restoring and showing the boat off beautifully with refined paintwork, beautiful upholstery and fine artistic touches throughout.

It is abundantly clear that this is a boat much loved and that shows in every aspect of its hull and outfit which, according to all recent surveys,

Meander, having been kept in pristine condition for over 35 years by Dennis Feroce and his wife Jan, is now for sale.

52 BC Shipping News February 2013

yachts is in excellent condition. The hull has never been re-planked, nor had any major re-construction. Dennis takes great care to maintain thorough circulation of air through all parts of the hull. Regrettably, Dennis and Jan have decided that it is time for a lifestyle change and they have reluctantly put Meander up for sale — they will do their future “ meandering” on the open road.

As an anecdote to this story of the yacht itself, there exists a rather fine model of Meander with its own local history. This model was built by my late Father, Robert F (Bob) Allan, in 1934 when he would have been just 18 years old.

My Grandfather had the careful habit of writing drafts of letters, even personal letters. Presumably, when he had no money to spend on note paper in those tough days, he used the pages of various old design workbooks for this purpose, sometimes even writing over the old calculations. As I was searching for technical details of Meander in a design notebook from the 1920s and 1930s, I found one of these draft letters written in 1934 to his friend, architect Frank Gildersleeve (with whom he had collaborated on the interior design of the CPR’s Princess Louise in 1920): “Boatbuilding here is almost an extinct business; only a small amount of work keeping the yards open. Since the completion of Mr. Kidd’s yacht Meander there has been nothing much larger than rowboats….Bobby (i.e. my father) is attending university having obtained a small scholarship which has enabled him to do so. He has made a beautiful model of the Meander; really the best I have ever seen. Everything in exact replica, even to the furniture inside the cabin. It is all lit up with electricity. Our hope is that Mr. Kidd will purchase it at a decent price.”

According to my late Father, Mr. Kidd did indeed come through with “a decent price”, enabling Dad to complete another year at University. A bit of detective work uncovered the model, still in the hands of Mr. Peter Kidd, the great-nephew of the original owner. I had the pleasure of meeting Mr. Kidd and seeing the model just a few weeks before Christmas. It’s a bit the worse for wear after nearly 80 years, with a notable gap in her starboard bulwarks and

a few other missing small bits, but it is easily restorable. It is obvious however that the entire model is built in exactly the same manner as the real boat. The deck is built with individual teak stripplanks, each barely four mm wide. Peter Kidd has never been on the real Meander as the boat was impressed by the Navy when he was a very small boy, but the Meander is clearly a very important part of their family lore as well.

It is gratifying to know that the roots of Robert Allan Ltd. were laid on the

ways with this beautiful classic yacht, and that this wonderful example of the skills of previous generations still graces B.C.’s coastal waters.

Robert G. Allan took over from his Father as President of Robert Allan Ltd. in 1981 and is currently Executive Chairman of the Board. The company is established as an international leader in commercial small craft design with a staff of highly qualified professionals who handle a wide variety of projects for clients around the world.

Guiding mariners for over 100 years.

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From installation to warranty support and maintenance.

CMC understands what you need.

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BRITISH COLUMBIA (604) 435-1455 ONTARIO (905) 607-4262 QUEBEC, Matane (418) 562-6637 NOVA SCOTIA, Dartmouth (902) 468-8480 Yarmouth (902) 742-3423 NEWFOUNDLAND (709) 726-2422 email navcommsales@cmcelectronics.ca www.cmcelectronics.ca February 2013 BC Shipping News 53

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THE OTTAWA MARINE TECHNICAL SYMPOSIUM FEBRUARY 20-21, 2013

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54 BC Shipping News February 2013

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