BC Shipping News - May 2017

History Lesson: Vancouver’s first shipment of Alberta oil

Tankers: Tankers in context

Legal Affairs: The duty to honour: Gitxaala Nation v. Canada

BC SHIPPING Commercial Marine News for Canada’s West Coast.

Volume 7 Issue 4

www.bcshippingnews.com

NEWS May 2017

LNG

LNG Canada pushing forward despite FID delay

Risk Management Deplorable footwear and its connection to fleet risk reduction

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International Shipping — All hail THE Alliance

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Contents

NEWS

Cover Story

May 2017 Volume 7 Issue 4

41 Technology

New hatch testing service employs ultrasonic technology

By Jim Drummond

42 Marine safety

30 7

Editor’s note

8

In brief

By Jane McIvor

Industry traffic and news briefs

14 Industry insight

Maintaining a legacy Shawn McBride, President, King Bros. Limited While processes and technology have changed the daily work details, the consistency of service remains a bedrock for the company.

18 History lesson

Black gold for B.C. Vancouver’s first shipment of Alberta crude oil

By Lea Edgar

20 Tankers

Tankers in context

By Captain Stephen Brown

24 LNG

LNG Canada pushing forward despite FID delay

28 International shipping Vancouver’s window of opportunity to build a global maritime business hub

30 International shipping

All hail THE Alliance

By Chris Gould

Continuously improving marine safety, starting with the right set of data

By Sonia Simard

43 Legal affairs

The duty to honour Gitxaala Nation v. Canada

By Megan Nicholls

45 Naval architects

Capilano Maritime Design Ltd. turns 10

47 Environment

GreenTech 2017: First conference in the American South

By Julie Gedeon

49 Tugs & barges

ITB Marine new tugs on the way

By Alan Haig-Brown

52 Polar Code

ABS delivers first Polar Code Operational Assessment

By John Dolny

33 Risk management

Deplorable footwear and its connection to fleet risk reduction

By Dermot Loughnane

53 Shipwrecks

Last port of call of the S.S. State of California

By David Leverton

36 Social licence

Make-believe, nice-to-have, or must-have for a sustainable marine shipping sector?

By Dr. Richard Wiefelspuett

14

38 Classification

52

Cruising in Canada’s Arctic Realizing the benefits from LR’s re-organization

On the cover: The Ebony on its way to West Coast Reduction (photo: Dave Roels for the Pacific Pilotage Authority); above: The Mercury Leader (photo: Dave Roels); right: Arctic shipping (photo: ABS); left: Shawn McBride.

May 2017 — BC Shipping News — 5

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May 2017 Volume 7/Issue 4

Publisher McIvor Communications Inc. President & Editor Jane McIvor

Contributing Writers Captain Stephen Brown John Dolny Jim Drummond Lea Edgar Julie Gedeon Chris Gould Alan Haig-Brown David Leverton Dermot Loughnane Shawn McBride Megan Nicholls Sonia Simard Dr. Richard Wiefelspuett Editorial Assistant Amanda Schuldt-Thompson

Advertising and Subscriptions Phone: 604-893-8800 Jane McIvor (jane@bcshippingnews.com) Advertising only: Lesley McIvor (lesleymcivor@shaw.ca)

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Contents copyrighted 2017 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 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.

Proud member of: 300 – 1275 WEST 6TH AVENUE, VANCOUVER, BC V6H 1A6 T: 604-893-8800 / F: 604-708-1920 E: JANE@BCSHIPPINGNEWS.COM 6 — BC Shipping News — May 2017

International Sailor’s Society Canada

EDITOR’S NOTE

Photo: Dave Roels

The Vancouver Maritime Museum has outdone itself

I

was going to use the space for this month’s Editor’s Note to describe the articles you’re about to read and tell you how impressed I am with the calibre of writing from the authors — both for style and content. But you’ll read that for yourselves and I’m sure you’ll agree. Instead, there’s a more important message to impart — in particular, I encourage you to visit the Vancouver Maritime Museum’s latest exhibit, The Lost Fleet.

I had the opportunity to attend the opening night reception — roughly about the time U.S. President Trump was trying again to implement his travel ban on Muslims. I have to say, this exhibit is very timely in that context.

The Lost Fleet exhibit describes the story of B.C.’s local Japanese community during the Second World War. While the full spectrum of their treatment is on display, including newspaper articles filled with suspicion and accusations, the Museum puts a special spotlight on the fishing and maritime aspects of that appallingly cruel episode in Canada’s history.

Over 1,000 boats were seized along with property and businesses; families were disrupted and lives were destroyed.

All this because of policies based on “fear, ignorance and prejudices,” to use the words of VMM’s Executive Director, Ken Burton.

To continue with Ken’s words: “When the exhibition plan was coming together,

the media was rife with anti-immigrant rants. The staff and myself came to the uncomfortable conclusion that we could easily pull a newspaper article from the Lost Fleet and a current newspaper — replace the word ‘Japanese’ with ‘Syrian’ and the passages would still read the same. The same anger, same ignorance, same hate — just a different target.”

Indeed, when you get to the end of the exhibit, curator Duncan MacLeod has cleverly tied the two eras together.

So visit the Museum and The Lost Fleet exhibit. Immerse yourself in the story and reflect on the lives forever altered.

Remember that sometimes history does repeat itself if we allow it.

— Jane McIvor

Cyber-enabled ships: ShipRight procedure With autonomous ships likely to enter service soon, LR has set out the ‘how’ of marine autonomous operations in a new ShipRight procedure guidance.

Read the guidance at www.lr.org/cyber

Working together for a safer world Lloyd’s Register and variants of it are trading names of Lloyd’s Register Group Limited, its subsidiaries and affiliates.

Copyright © Lloyd’s Register Group Limited 2016. A member of the Lloyd’s Register group.

Half page BC shipping_CYBER_060516.indd 1

May 2017 — BC Shipping 11/07/2016 News — 13:39:10 7

INDUSTRY TRAFFIC Letter: In praise of the future generation Hello Jane, I recently read the article on Rhianna Henderson, a third-year cadet in the BCIT Nautical Sciences Program, and found it very interesting and reassuring. I can relate to her situation somewhat having graduated from the Canadian Coast Guard College 40 years ago as a young engineering officer, but the marine industry has changed significantly since those of our vintage graduated from their respective colleges.

Ms. Henderson seems to understand and embrace the fact that a successful

ship requires all departments to work closely together and she is determined to understand the interrelationship between all departments and the entire crew roles and responsibilities. I think our industry is in very good hands if future officers like Ms. Henderson are at the helm and in the control room — we just need many more of them!

Regards, Ed Gerow Nanoose Queen’s Harbour Master Esquimalt / Auxiliary Fleet Department of National Defence / Government of Canada

Full service ship's agency in Victoria 306 - 1208 Wharf Street Victoria BC V8W 3B9 Tel: 250-384-1653 Fax: 250-382-3231 Email: kingbros@kibro.com

Full service ship's agency in Victoria 306 - 1208 Wharf Street Victoria BC V8W 3B9 Tel: 250-384-1653 Fax: 250-382-3231 Email: kingbros@kibro.com

Celebrating our 10th Anniversary!

8 — BC Shipping News — May 2017

Upcoming events Nautical Institute BC Branch 2017 Conference When: May 10 to 12, 2017 Where: Victoria, B.C. More details: www.nibcconference2017.com GreenTech 2017 When: May 30 to June 1, 2017 Where: Fort Lauderdale, Florida More details: www.green-marine.org/greentech.

Council of Marine Carriers 22nd B.C. Towboat Industry Conference & CMC Golf Tournament When: June 1 to 3, 2017 Where: Whistler, B.C. More details: www.comc.cc Association of Canadian Port Authorities 2017 Conference When: September 18 - 21, 2017 Where: Vancouver, B.C. More details: http://www.acpa-ports. net/pr/events.html Canadian Ferry Operators Association 2017 Conference: When: September 24 - 26, 2017 Where: Halifa, N.S. More details: www.canadianferry.ca/ conference-2107/ 42nd Annual Interferry Conference When: October 7 to 11, 2017 Where: Split, Croatia More details: www.interferryconference.com Cargo Logistics Canada Expo+Conference When: February 6-8, 2018 Where: Vancouver, B.C. More details: www.cargologisticscanada.com

NEWS BRIEFS CN recognizes 32 customers for sustainability leadership under CN EcoConnexions Partnership Program Photo: Courtesy CN (Lonnie Wishart - www.lonniewishart.com)

C

CN presented EcoConnexions awards to forest industry partners during the recent Council of Forest Industries Convention in April.

products to manufactured products to consumer goods, across a rail network of approximately 20,000 route-miles spanning Canada and mid-America. For more information about CN, visit the Company’s website at www.cn.ca.

The CN Ecoconnexions Partnership Program not only encourages CN partners to promote sustainability but also reaches out to employees and communities across North America to engage in meaningful ways to preserve and protect the environment. Partners like Tree Canada, Communities in Bloom, and Earth Day organizers benefit from grants, recognition awards and initiatives that involve thousands of CN employees.

Photo: Dave Roels (www.daveroels.com)

N has recognized 32 of its customers for their sustainability practices that are aligned with the objectives of the CN EcoConnexions program.

The CN EcoConnexions Partnership Program selects companies that pledge to work to reduce their carbon emissions and increase energy efficiency — a central focus of CN’s sustainability objectives.

At the recent Council of Forest Industries Convention in Vancouver, where CN was recognized as a Platinum Sponsor, Shauntelle Paul, Assistant Vice President, Network Operations, announced six of the 32 partners who were in attendance — Canfor, Domtar Corporation Inc., Resolute Forest Products, Tembec, Verso Corporation, West Fraser and Weyerhaeuser.

Recipients collected their awards at CN’s Lounge in the exhibit area where a number of CN represenatives were on hand to discuss and highlight their initiatives addressing safety, training, sustainability and First Nation engagement.

Additional partners who were recognized by CN for their leadership in sustainabilty practices included: Alcoa Corp., Atlantic Container Line, Bunge North America, Bonduelle Canada, Cenovus Energy Inc., CMA CGM (America) LLC, COSCO Shipping Lines (North America), E.I. du Pont de Nemours and Company, Fairmount Santrol, Ford Motor Company, Hapag-Lloyd, Kruger Products LP, Labatt Breweries of Canada, Loblaws Inc., Maersk Line, MOL, Mondelēz International, NYK Line, OOCL, PepsiCo Canada, Teck, Tenaris, UPS, Walmart Canada, and Yang Ming.

“CN is proud to partner with these companies and congratulates each of them on their sustainability efforts,” said JJ Ruest, CN executive vice-president and chief marketing officer. “CN in partnership with Tree Canada will plant 100,000 trees in the spring in recognition of its customers’ commitment to sustainable business practices.”

CN is a true backbone of the economy transporting more than C$250 billion worth of goods annually for a wide range of business sectors, ranging from resource

CN’s Shauntelle Paul announced the EcoConnexions awards to their forest industry partners at the COFI Convention.

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INDUSTRY TRAFFIC

Photo: Lonnie Wishart (www.lonniewishart.com)

Ray-Mont Logistics adding facility for export of containerized crops at Port of Prince Rupert

The Ray-Mont facility will take advantage of the Ridley Island Corridor to assist with moving cargo.

T

he Port of Prince Rupert has announced an expansion project for containerized cargo on Ridley Island that will help crops from the Canadian agricultural industry reach international markets while expanding intermodal logistics capacities at the Port of Prince Rupert.

Ray-Mont Logistics is developing an integrated logistics and container loading operation at the south end of the Ridley Island Industrial Site on the recently-constructed Road, Rail and Utility Corridor. The operation will

10 — BC Shipping News — May 2017

involve pulses and cereals (such as lentils, peas, beans, soybeans, flax, and wheat) as well as other specialty agricultural crops transported in hopper cars by rail from Western and Central Canada and the US Midwest. The cargo will be transferred to ocean containers for export via the Fairview Container Terminal, which is currently undergoing expansion.

“It is our pleasure to be working with the Prince Rupert Port Authority and its partners to establish a new transload facility in the Port of Prince Rupert, and continue to pioneer efficient services

for connecting North American crops to overseas customers,” said Charles Raymond, President & CEO of RayMont Logistics International. “Our core values of quality, flexibility and innovation are reflected in the strategic vision being executed by the Port of Prince Rupert, and we look forward to adding this valuable service to the Prince Rupert supply chain later this year.”

Operation of the completed facility will employ an estimated 40 people. The ten-acre facility will include a rail loop corridor in excess of 100 railcars, a grain dumper pit, and a state-of-the-art conveyance system.

The Ray-Mont facility will utilize rail tracks on the Ridley Island Corridor to take delivery of agricultural commodities and meet market demand for port-loaded export containers on the West Coast.

Cargo will be sent to Prince Rupert by agricultural shippers in Alberta, Saskatchewan, Manitoba and further inland, to be unloaded at the facility via a conveyor unloading system.

IDL Projects, on behalf of Coast Tsimshian Northern Contractor Alliance, will begin clearing the site this week and the new transloading facility will be operational in time for the 2017/18 crop year this fall.

“We’re excited to partner with RayMont Logistics to create a Canadian trade solution for high-value, high demand agricultural products,” said Don Krusel, President and CEO of the Prince Rupert Port Authority. “This exciting development is another important step advancing the expansion of intermodal logistics services with our partners CN and DP World to meet the growing demand of Canadian exporters seeking to capitalize on the advantages of the Port of Prince Rupert in reaching their global markets.”

Ray-Mont Logistics is the latest company to invest in logistics and transloading services at the Port of Prince Rupert, supporting its growing intermodal business. Fairview Container Terminal is currently being expanded to handle an increase in annual volumes from 850,000 TEUs to an anticipated 1.3 Million TEUs. The expansion is due for completion in August 2017.

INDUSTRY BRIEFS

ICS Chair meets with local maritime industry

12 — BC Shipping News — May 2017

Photo: Dave Roels (www.daveroels.com)

V

ancouver’s local maritime industry was treated to a special opportunity to hear from Esben Poulsson, Chairman of the International Chamber of Shipping (ICS) at a luncheon hosted by the Chamber of Shipping (COS) here in B.C. in late March. “We’re very fortunate to be able to welcome Mr. Poulsson,” said COS President Robert Lewis-Manning, referring to the guest of honour as a “shipping icon.”

Indeed, Poulsson’s 40-plus years in the shipping industry have been highlighted by leadership roles including President of the Singapore Shipping Association and a Director on the Board of the Maritime & Port Authority of Singapore (MPA).

In representing about 80 per cent of the world fleet through 35 national associations and 11 associate associations, the ICS’ task of ensuring the views of the shipping industry are well represented within the International Maritime Organization and other governments is a critical role — and none more so than in addressing the issue of greenhouse gas emissions. “While there is little disagreement on goals,” Poulsson said of the positions of ICS and the IMO, “there can be differences of opinions on the principles to achieve desired results.”

Poulsson stressed the need for the industry to work with the IMO to develop an action plan by 2018, that

Robert Lewis-Manning, President of the Chamber of Shipping, with Esben Poulsson, Chairman of the International Chamber of Shipping.

could be in place by 2023, following the spirit of the Paris COP21 agreement.

“We fear that unless we see serious progress, we’ll lose the opportunity to craft reasonable regulations and will end up with splintered legislation across many jurisdictions,” he said, pointing to places like the European Union and California, who were eager to move forward with their own laws.

Earlier initiatives, such as the EnergyEfficiency Design Index and the Ship Energy Efficiency Management Plan,

have contributed to the industry’s move toward lower emissions and, Poulsson noted that “it is a fact that by 2025, ships will be emitting 30 per cent less CO2.”

However, to meet the aspirations of the Paris Agreement, the IMO needs to agree to a baseline of peak CO2 emissions and a mechanism for delivery.

And, while whatever goal the IMO adopts must be realistic, a reduction of emissions will only be achievable with the use of alternative fuels, which are not yet readily available. “Total CO2 has already been reduced by more than 10 per cent between 2007 and 2012,” Poulsson said, “but projection of trade growth will suggest that a dramatic reduction will be difficult to achieve until alternative fuels are a reality. In the meantime, ICS argues that any CO2 reduction goals agreed to by IMO must also address the legitimate concerns of the industry and that no unforeseen or unintended consequences are wrapped into ill-thought-out regulations.”

Overall however, Poulsson was optimistic: “Shipping has proven itself to be very adaptable and has somehow always come up with a solution. It is the role of ICS to ensure any new regulations are based on evidence and science. We need to persuade regulators that we want to do the right thing but it has to be practicable.” BCSN

INDUSTRY BRIEFS

LPG Terminal Project Proposed for Watson Island

T

he City of Prince Rupert, through its wholly owned subsidiary Prince Rupert Legacy Inc., is happy to announce that a nonbinding Letter of Intent (LOI) has now been entered into with Pembina Infrastructure & Logistics, [a wholly owned subsidiary of Pembina Pipeline Corporation] (Pembina) for the purposes of exploring an LPG export terminal on Watson Island.

“We are looking forward to a new beginning for our community as we work towards putting Watson Island back on the tax roll,” said Mayor Lee Brain.

“Pembina is a Canadian company with a proven track record for supporting the communities in which they operate, and has an industry-leading history of operating safely. We are happy to have the opportunity to potentially partner with them to create new local jobs and revenue that will significantly improve the quality of life for everyone in Prince Rupert.”

Pembina will be conducting initial technical assessments and evaluating

the project’s feasibility, in addition to meeting with local First Nations and stakeholders. Following this process, Pembina’s Board of Directors will evaluate the project and determine a Final Investment Decision (FID).

“Watson Island has great potential as an LPG export terminal location,” says Mick Dilger, Pembina’s President & CEO. “Early impressions of the site are promising, and we’re happy to be working with the City of Prince Rupert.”

Pembina Pipeline Corporation is a Canadian company focused on the safe, reliable operation of energy infrastructure. They are a transportation, midstream and gas service provider that has been serving North America’s energy industry for over 60 years with positive relationships with various municipalities and First Nations in the areas surrounding their operations. The $23 billion energy infrastructure company is recognized as one of Canada’s Top Employers, and recently received recognition as Aboriginal Employer of the Year in 2015,

and as one of Alberta’s Top 70 Employers for the third consecutive year.

If plans move ahead, this proponent would be the first tenant for the Watson Island site since plans were made to dismantle the former pulp mill. The project is anticipated to use only a portion of the 280 acres available on the old pulp mill site. In January, the City of Prince Rupert leased a portion of Watson Island to Legacy Inc. in order to help facilitate new commercial operations.

Distributions from lease revenues were determined to be a more stable source of income for the municipality, and are considered a practical direction for the diversification of City revenues. Moving forward, the City and its wholly owned corporation will continue to work diligently in order to generate both lease revenues and future taxation from Watson Island, which will contribute to a more resilient local economy.

Incorporated in 2014, Prince Rupert Legacy Inc. is a wholly owned subsidiary of the City of Prince Rupert.

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INDUSTRY INSIGHT

Maintaining a legacy Shawn McBride, President, King Bros. Limited

I

n its 106-year history, King Bros.

Limited has had only five presidents.

From founder Edward H. King and his brother, Henry, who set up the Customs Brokers and Ship’s Agent firm in 1911 in Victoria, to Cecil Ridout, who started as an office boy in 1922 and led the company through the majority of the 20th century, to Cecil’s son Paul, Greg McAllister, and now Shawn McBride, the company is able to boast one of the longest, continuous corporate histories in B.C. While processes and technology have changed the daily work details, the consistency of service — and the very low turnover of staff — remains the bedrock of the company.

BCSN: The history of King Bros.

Limited is impressive. Could you provide an overview?

SM: Edward King, a former clerk with Wilson Bros., one of B.C.’s largest wholesale grocery firms, founded the business in 1911 and brought in his brother Henry as a partner. Cecil Ridout joined the firm in 1922 as a messenger — he was 15 years old at the time and told it would be a short-term position.

He worked his way up through the company, eventually becoming the manager in 1944 when Edward and Henry sold the company to the owner of the Victoria Machinery Depot. Cecil, along with Kenneth Briggs and Robert Paterson, purchased the firm in 1947 and, when Cecil passed away in 1993, he was still president of the company.

In 1975, Ridout’s sons, Lorne and Paul, purchased the company. At the 14 — BC Shipping News — May 2017

While processes and technology have changed the daily work details, the consistency of service — and the very low turnover of staff — remains the bedrock of the company. time, Lorne was the Manager and Paul was the Operations Manager. They worked together for almost 20 years before Lorne retired and Paul took sole ownership. About two years after Lorne’s retirement, Greg McAllister — another long-time employee of the company — purchased shares and, when Paul decided to retire in 2004, he sold his majority interest to Greg and me. At that time, I was the firm’s Customs Manager.

Greg retired in 2012 and I became the majority shareholder. Simon Smith, also a long-term employee, became the minority shareholder and, when I retire, Simon will move into my position as President.

BCSN: So, safe to say there’s not much turnover in staff. What do you attribute that to?

SM: Yes, we take a lot of pride in that.

It’s mostly because we take care of our staff; they’re like family and usually only leave when they retire. We have 12 staff.

The customs brokerage and ship agent departments are basically two separate entities, although we have one or two who work both sides when needed.

BCSN: Let’s look at the ship agent side first — could you describe the activities as well as the areas you cover?

SM: We provide service to ships anchored or berthed throughout the

Victoria/Vancouver Island region, including up to Cowichan Bay, just before Duncan; the Gulf Islands and, of course, Ogden Point in Victoria Harbour.

We get about 200 to 300 vessels per year — a whole variety, everything from cruise, cargo, research, fishing vessels, private yachts, even foreign naval ships.

A lot of work comes in the form as sub agents from Vancouver agents. They’ll call us when they can’t get a vessel alongside or an anchor in their area so we’re asked to find them an available anchorage outside of Vancouver Harbour.

Depending on their needs, we support them on a number of fronts — from immigration and customs formalities, other governmental department compliance, berth reservations and stevedore services, shore-side medical assistance, waste and recyclables removal and the co-ordination of drydocking as well as oversight while they’re in drydock. We’ll also arrange for pilots to come and go as well as getting provisions out to the vessel and crew changes.

BCSN: What about the customs brokerage?

SM: Technically, we can represent importers at any port across Canada through EDI (electronic data interchange) and sub agents. On behalf of

clients, we’ll prepare and submit Prearrival Review System (PARS) and EDI customs entries, Advance Commercial Information (ACI) eManifest documents or import and export customs documentation. We also consult with clients to provide customs procedures reviews as well as logistics and supply chain information.

And it’s not just for vessels — we also work with trucks and air carriers like FedEx and UPS, to clear imports.

Typically, most of the importations we deal with are from the U.S. BCSN: What about exports?

SM: We don’t get too involved in exporting anymore. More or less since 911, there has been a huge increase in regulations and it’s necessary to bring in a U.S. broker to get the necessary documentation. So we always recommend our customers cut out the middleman (us) and deal directly with one of our American counterparts. And usually, goods require a 24-hour minimum preclearance before crossing the border.

BCSN: This is a good segue into my next question about trends. Looking at the

Paul Ridout, Past-President of King Bros. Limited, with Shawn and Jason Michell from Nanaimo Port Authority.

More or less since 911, there has been a huge increase in regulations and it’s necessary to bring in a U.S. broker to get the necessary documentation. customs broker side, what changes have you seen, especially after 2011?

SM: Customs brokerage has changed significantly in the last decade or two.

First, there is the movement to an electronic environment, allowing for more timely releases and entry processing. In addition, the Canada Border Services

Dave aboard the CSL Tecumseh “Action Photography - everywhere!”

“Dave’s not just a photographer, he’s an artist.”

Jane McIvor, Publisher BC Shipping News May 2017 — BC Shipping News — 15

INDUSTRY INSIGHT Agency (CBSA) has moved away from focusing on the collection of duty and tax, and leans more today on security and interdiction of drugs, weapons, and contraband.

CBSA also continues to move toward a more modern environment, working in conjunction with other government departments and utilizing shared electronic platforms between various departments and ministries.

Brokers are the interface between the government and the importing community, be it institutional, private, or public.

While there is preliminary talk about deregulating brokers, we believe that we fulfill a vital role in facilitating the release and movement of freight, in the collection of duties and tax on behalf of Canada Revenue Agency, and in providing a role which simply cannot be filled by the limited resources allocated to the CBSA. We are a federally regulated private company fulfilling an important intermediary function which allows for the effective collection of national revenue, and allows CBSA to focus on the security of our borders.

BCSN: What about trends on the ship agency side?

SM: First and foremost, government regulations have increased. All ships require agents to help them comply with Transport Canada and it has become a very pre-approved process. There was a point when Customs would board every ship that came into our area but now, boarding a foreign vessel is not as big a requirement unless there are suspicions that something isn’t right. Today, it’s mostly electronic preclearance that’s done. For cruise ships, for example, crew and

16 — BC Shipping News — May 2017

Shawn accepts a plaque of recognition from a visiting ship’s captain.

passenger notifications are required well in advance of arriving in Canadian waters and customs will make a decision based on that whether they can be granted entry.

BCSN: Do you get many vessels that are refused entry?

SM: No, not many. There was the gypsy moth issue a number of years back that required the Canadian Food Inspection Agency to conduct an inspection prior to arriving to load grain.

If bugs were discovered, they would be required to wash out the hold before approval was given. If a CFIA inspection is required, we’ll arrange to get the inspector out to the vessel.

BCSN: What about growth patterns — both in terms of volume and type of ship?

SM: Certainly, the number of cruise ships entering Victoria has increased, but for other vessels, it varies each year. In the winter especially, we’ll see a lot of ships anchoring and requiring our attendance because of heavy snow fall in the Prairies, which holds up the grain coming into Vancouver. In general, there has been a big increase in anchorages in the Cowichan Bay and surrounding areas but again, it varies.

In some years, we’ll see a lot of U.S. naval vessels (but other years, not so much), and we do see more business in yacht ships coming to Ogden Point, but both are hard to predict.

BCSN: Tell me more about cruise ships — the process for clearing as well as your responsibilities when they’re at dock. I imagine it’s quite different from other vessels.

SM: Yes, cruise ships are quite unique in their needs. First, a lot of the information, like passenger and crew lists, is transferred to CBSA prior to the arrival of each ship. Sometimes, those are required as much as 96 hours in advance of arrival (but 48 and 24-hour notifications are also common). We’ll facilitate that, and then on arrival, we are there at the gangway and we will escort any passenger or crew member who needs to be interviewed. We’ll stand by while CBSA conducts the interview and then processes the paperwork which gives the green light to clear the ship and allow passengers to disembark.

We co-ordinate the ship’s visit from beginning to end and are there to assist the ship and crew with any requirements they might have during the visit. And then we’ll stand by until the last person is on board and give the thumbs up for departure.

INDUSTRY INSIGHT BCSN: The Greater Victoria Harbour Authority has been working on their Master Plan for Ogden Point — will that change things for King Bros. Limited?

SM: I think that’s a question GVHA would have to answer as far as looking at future oportunities. They have made it very clear they’d like to become a home port. Right now, we’re tied to Seattle’s growth because of the Jones Act which benefits Victoria greatly, and the season is expanding with visits earlier and later in the season. There are a maximum number of berths so growth would have to be on off-peak days — i.e., outside of the Thursday to Saturday timeframe. And I believe the Master Plan takes into account the trend of larger ships on the Alaska run.

BCSN: In terms of looking at the future, are there any issues that you can see that would impact on levels of activity?

SM: Certainly, any review of the U.S. Jones Act would have a big impact on volume. There are also changing requirements for which countries still require Canadian visas but that has always been an issue and can complicate a visit if a passenger has been turned away because they haven’t obtained the correct paperwork.

Regulation wise, each year, CBSA publishes a cruise ship handbook which we forward on to the lines. It hasn’t changed in the last few years and crew are quite familiar now with the requirements, so the process has become quite standardized.

The issue of air emissions impacting on the surrounding James Bay neighbourhood was an issue for a number of years but I think GVHA and Cruise Lines International Association

Shawn stands with Simon Smith, minority shareholder, and future President, of King Bros. Limited.

– North West and Canada have done a good job in addressing this. Through monitoring and education, local residents are recognizing that the ships are meeting requirements. And GVHA continues to try to mitigate any disturbances to the local areas that might arise from shuttle buses. I know they work very hard to manage that and relations have been improving. BCSN

About Shawn McBride

About King Bros. Limited

hawn was hired by King Bros.

Limited at the age of 19, working as a summer student while attending the University of Victoria.

While his original goal was leaning toward a career in accounting, when asked to join King Bros. as a customs broker, he agreed, ultimately running the Customs Brokerage department.

King Bros. Limited is an independently owned Customs Brokerage and Ship’s Agency located in the beautiful port city of Victoria, B.C. The family-based company has been in operation since 1911, with the current owners maintaining the founders’ values of integrity, honesty and professionalism.

S

When, in 2004, Paul Ridout decided it was time to retire, Shawn, along with Greg McAllister, bought Paul’s shares. At that time, Greg became the majority shareholder, with Shawn holding the minority share.

He continued as the customs brokerage manager until 2010, when he became more involved in the ships agency work. In 2012, Greg McAllister retired, selling his majority stake to Shawn, with Simon Smith coming in as a minority partner.

Of King Bros. Limited, Shawn was quick to praise those presidents who came before him. Noting that the Ridouts were a great family to work for, Shawn attributes the low turnover of staff because of their family-oriented business which pays well with full compensation and pension. “Once someone joins King Bros., they’re usually here until retirement.”

As customs brokers, King Bros. Limited provides a complete range of import and logistics services on par with any national broker. Dedicated, fully qualified staff is always available to provide exceptional service for clients at any port across Canada.

As port agents, King Bros. Limited again employs a highly qualified and experienced operations department to provide first-class service and support not only within the port of Victoria, but also to most other ports on Vancouver Island.

King Bros. Limited is proud to be part of a vibrant, local economy, and they strive to do their part by supporting local businesses, charities, non-profit societies and athletic groups.

They are members of the Victoria Chamber of Commerce, Cruise Industry Association of B.C., and other local affiliations.

For more information: www.kibros.com May 2017 — BC Shipping News — 17

HISTORY LESSON Black gold for B.C. Photo: Dave Roels

Vancouver’s first shipment of Alberta crude oil

By Lea Edgar Librarian & Archivist, Vancouver Maritime Museum On March 21, 1951, the Trans Mountain Pipeline Company was created by a special act of parliament. That same year, after a three-day hearing, the Board of Transport Commissioners approved the pipeline proposal from Trans Mountain.

I

n the early 1950s, exporting the oil discovered in Alberta was still in its nascent stages. The dream was to ship the oil products out of the country — primarily to the United States — so that Canada could become a major player in the oil exportation business. It was the discovery of crude oil in Leduc, Alberta, that kick-started the province’s lucrative oil industry, and first inspired the idea of the Trans Mountain Pipeline.

On March 21, 1951, the Trans Mountain Pipeline Company was created by a special act of parliament.

Ownership of the company was split between Canadian Bechtel Ltd. and Standard Oil. That same year, after a three-day hearing, the Board of Transport Commissioners approved the pipeline proposal from Trans Mountain.

In addition to exporting oil products to the U.S. and Asia, another argument in favour of the pipeline was that it would offer British Columbians cheap and accessible oil. It was also seen as a strategic defence should a war with the Soviet Union ever occur. The approval process did not involve public consultation or an environmental assessment.

After being given the official go-ahead, engineers took numerous trips between Edmonton and Vancouver to determine the best route for the pipeline.

They finally settled on the Yellowhead Pass route and generally followed existing railway lines and roads. Between February 4, 1952, and October 17, 1953, the Trans Mountain pipeline was constructed, starting in Edmonton and 18 — BC Shipping News — May 2017

ending in Burnaby. An 8.9-kilometre spur line was also constructed from Sumas, B.C. to Ferndale, Washington (and later Anacortes). Canadian Bechtel Ltd. was responsible for the engineering, design and construction of the project.

On October 17, 1953, the first oil was pumped through the pipeline. The total cost for construction was $93 million.

Initial capacity was 150,000 barrels per day. (The current capacity is approximately double that amount.) The pipeline had four pump stations along the 1,150-kilometre route. It wasn’t until January 1, 1956, that an offshore tanker loaded the first shipment bound for the United States. The vessel, Flying A California, loaded 118,000 barrels (worth $350,000 at the time) at the Westridge Terminal. The dock was built in 1953 but had never been used before. The purchaser for this first shipment was the Tide Water Associate Oil Company that produced, refined, and marketed oil in the U.S. This shipment, although seemingly meagre, was momentous in that it marked the first time Canada broke into the California oil market. Before this shipment, B.C. imported oil from California for treatment at local refineries. This shipment was also important because its original purpose of moving oil from Canada offshore from the Port of Vancouver was finally recognized.

This was truly the proof of concept that Alberta crude oil could be exported to California for profit.

The Vancouver Maritime Museum holds a unique memento of the hist-

Crude oil sample from the first shipment out of Vancouver on the Flying A California. VMM object number 2014.002.001.

oric first shipment of crude oil out of Vancouver. Pictured above is a sample of the first crude oil sold to the California market. The sample was collected by petro-chemist Lewis H. Detz.

The Flying A California, the vessel which held the notable first shipment, was part of a small fleet of West Coastbased tankers owned by the Tide Water Oil Company. Tide Water was well known for its “Flying A” brand products and gas stations, as well as for Veedol motor oil. The company was owned by the famous Paul Getty who acquired it in 1953. The Flying A California was a 16,000-ton tanker manned by a crew of

VANCOUVER MARITIME MUSEUM

M.S. Flying A California, June 5, 1960. City of Vancouver Archives reference number AM1506-S3-3-: CVA 447-4628.1.

Photograph by Walter E. Frost.

The Flying A California, the vessel which held the notable first shipment, was part of a small fleet owned by the Tide Water Oil Company ... well known for its “Flying A” brand products and gas stations...

40. She was one of four U.S.-built tankers added to Tide Water’s fleet in 1954. The vessel was 514 feet long with a speed of 16 knots and could accommodate 131,000 barrels. Her master for this first shipment was Captain Oscar Bengtson and the local agents for the ship were C. Gardner Johnson Co. Ltd. In 1957, the Trans Mountain pipeline capacity was expanded with the addition of a 160-kilometre loop. The Flying A California was reported to still be carrying oil products from the Westridge Terminal in 1960. At that time, it was loading 126,000 barrels bound for Portland, Oregon.

The Westridge Marine Terminal continues to be a fixture within the Port of Vancouver’s domain, and, unless you’ve been living in a cave for the past five years (the length of time the approval process has taken so far), current operators, Kinder Morgan, have applied to twin the existing pipeline and replace the present single berth at Westridge with three new berths.

With these improvements, tanker traffic is expected to increase from approximately five Aframax-size tankers per month to 34 tankers per month. The pipeline’s capacity would increase from approximately 300,000 barrels a day to 890,000.

The terminal is regulated by Transport Canada and the National Energy Board. Along with shipping crude oil, the facility also receives and ships jet fuel. A jet fuel pipeline system delivers the fuel to the Vancouver International Airport.

The terminal has three storage tanks and handles volumes of approximately 395,000 barrels.

Since the discovery of oil in Leduc, Alberta over 70 years ago, and the subsequent export of oil out of Vancouver’s Harbour, the oil and gas industry is now the backbone of the province’s economy and contributes significantly to the national economy. The Trans Mountain pipeline proved to

be a key component to the industry’s success. As the industry moves forward and expansions continue, it is important to take time to see just how far we have come since that first small shipment aboard the Flying A California departed Vancouver in 1956.

Lea Edgar started her position as Librarian and Archivist for the Vancouver Maritime Museum in 2013. She can be contacted at archives@vanmaritime.com.

John M. Horton, Marine Artist Paintings and limited edition prints for corporate offices, retirement gifts and marine art collections

“Into First Narrows”

This specially commissioned piece shows the “Sea Reliance,” owned by Crowley Marine Services of San Francisco, entering Vancouver Harbour very early on a summer morning. I had to get there earlier! Boarding a Seaspan tug, I fortunately captured the stern to show the strength of this powerful tug.

For special commissions:

www.johnhorton.ca (604) 943-4399 / john@johnhorton.ca May 2017 — BC Shipping News — 19

TANKERS

Tankers in context

By Captain Stephen Brown West Pacfic Marine Ltd.

T

he decision of the Canadian Federal Government in November 2016 to approve the Kinder Morgan Trans Mountain expansion project, subject to meeting the 157 conditions imposed by the National Energy Board, while at the same time rejecting the Northern Gateway project, drew predictable reactions on both sides of the argument.

While effectively laying to rest several court challenges to Northern Gateway, the decision opened the door to new challenges against Kinder Morgan, further compounded in the view of project opponents by the decision of the B.C. Government who concluded that it’s long-held five conditions for approval have now been met, giving the project a green light in January this year.

Of course, all of this continues to shine a light on the protocols governing the movement of tankers in the waters of Western Canada. In 2016, tanker traffic in the port of Vancouver amounted to 522 vessels. Most of these were relatively small chemical/product tankers but there were also 30 tankers in the Panamax and Aframax range. The frequently asked question is how would we manage up to 400 tankers per year?

As an industry, our response should perhaps begin by placing Vancouver’s traffic statistics into context. Perhaps the first issue to appreciate is that, discounting the movement of grain ships, with an average of eight new arrivals and eight departures per day, our traffic density is very light by any international comparison. In fact, the numbers for most of the year are even lighter given that they spike during the cruise season, which alone in 2016, represented 228 port calls.

We should also not lose sight of tanker arrivals at U.S. terminals in Puget Sound. In 2016, these comprised 96 arrivals from Alaska, and 259 from other origins, for a total of 355 arrivals — close to the annual average tanker traffic level for Puget Sound (i.e., around one vessel per day).

Compare this to 88 arrivals per day, 20 of which are tankers at one of the world’s largest ports, Rotterdam. Similarly, Singapore averages 380 arrivals per day, which translates to one arrival every four minutes. In 2016, Singapore handled 15,805 oil tankers, 5,209 chemical tankers and 2,681 LNG & LPG carriers. We obviously have some way to go to meet these traffic levels even when added to U.S. tanker traffic on passage to and from Puget Sound.

A second consideration is to give serious thought to the notion that increased ship traffic automatically translates to increased risk. There are no statistics to support such a conclusion and the reasons are quite straight forward. Using the example of the aviation industry, there does not appear to be any suggestion that every time YVR adds a new airline or increases the frequency of an existing service that this translates 20 — BC Shipping News — May 2017

...increased traffic does not represent increased risk so long as port or airport expansion is managed and risk, real or perceived, is sensibly mitigated. to increased risk to customers. Back in 1992, YVR recorded 249,000 runway movements and in 2016, recorded 280,000 runway movements. This represents a 12 per cent increase in movements, but of course this does not begin to tell the full story because, as with the marine industry, the average size of aircraft has significantly increased, which is why over the same period, YVR passenger numbers have ballooned from 10 million to 22 million.

Leaving aside these and many other relevant comparisons, the crucial point to grasp is that increased traffic does not represent increased risk so long as port or airport expansion is managed and risk, real or perceived, is sensibly mitigated. So how do we do this, particularly in relation to management of tanker traffic? It may be easier to look at this from an international level and then to focus in at the local level.

The grounding of the Exxon Valdez in Prince William Sound in March 1989, and the subsequent spillage of approximately 36,000 tonnes of crude oil, resulted in the U.S. government introducing the Oil Pollution Act of 1990 (OPA 90). The intent of this law was to minimize oil spills through improved tanker design (double hulls), operational changes,

Growth in seaborne oil trade (blue line) and the decline in the number of tanker spills (seven tonnes and over) from 1970 to 2014. (Source: International Tanker Owners Pollution Federation Limited).

TANKERS and greater preparedness. Following on from the U.S. lead, in 1992, the International Maritime Organization (IMO) amended MARPOL to make it mandatory for tankers of 5,000 dwt or more ordered after July 1993 to be fitted with double hulls, or an alternative design approved by IMO. However, following the Erika incident off the coasts of France and Spain in December 1999, IMO Member States considered proposals for accelerating the phase-out of single-hull tankers. In April 2001, the IMO therefore adopted a revised phaseout schedule which entered into force in September 2003 (the 2001 amendments to MARPOL). The revised requirements set out a stricter timetable for the phasing-out of single-hull tankers with an effective phase-out date of 2008. A handful of exemptions allowed a small number of single-hull tankers to trade with limited geographical scope until 2013, but that became the final de facto drop-dead date. There can be little doubt that this measure was the single most effective reason for the dramatic decline in oil spills from tankers in the last three decades.

However, this is by no means the full story since the last 30 years has seen nothing short of a revolution in terms of ship-board technology improvements resulting in precision navigation capability and vastly improved data flows to assist decision making in tandem with specialized officer training and certification.

At the local level, the mitigation of marine risk is diligently applied to all vessel sectors but assumed increased scrutiny as a consequence of the Northern Gateway and Kinder Morgan projects along with the conditions attached to the outcomes of the related Transport Canada-led Navigation and Operational (TERMPOL) studies, i.e. the Code of Recommended Standards for the Safety and Prevention of Pollution for Marine Transportation Systems and Related Assessment Procedures.

In addition to the in-shore coast of B.C. being one of the world’s largest compulsory pilotage jurisdictions, the level of risk mitigation applied to existing traffic far exceeds that of other regions of high-frequency tanker traffic in North America, including the East Coast of Canada, St. Lawrence Seaway and Great Lakes. Tankers of 185 metres

Spills seven tonnes and over in the decades 1970s – 2010s. (Source: International Tanker Owners Pollution Federation Limited)

May 2017 — BC Shipping News — 21

TANKERS in length and/or 40,000 tonnes summer deadweight capacity in product (loaded) are required by the Pacific Pilotage Authority to engage two pilots to transit the Port of Vancouver to and from Kinder Morgan’s Westridge Terminal along with a level of tethered tug escort capacity that can comfortably withstand loss of propulsion or rudder failure. The use of simulations and real-life exercises under all manner of predictable tidal and weather conditions to prove this statement has been exhaustive. Similarly, tethered tug escort requirements for tankers have been introduced in Haro Strait and Boundary Pass, and in the case of the Kinder Morgan project, a tug escort will be applied to tankers in product all the way to the mouth of the Juan de Fuca Strait — thereby far exceeding current legislative requirements.

For its part, the Vancouver Fraser Port Authority (VFPA) in 2016 initiated a comprehensive review of the regulations governing all traffic transiting both First Narrows and Second Narrows. These are now set out in updates to the Port Information Guide as the respective Marine Restricted Areas, MRA-1 and MRA-2. The objective of these reviews was to ensure a continued high level of safety in vessel traffic management following the consolidation of Marine Communications and Traffic Services (MCTS) to Victoria, but also to recognize the need for evolution in traffic management regulations as cruise ships, container ships and bulk carriers calling at the Port of Vancouver continue to grow in size. As a consequence of all these measures, there is every reason to be confident that we have a regime of risk management and mitigation which is second to none.

Of course, nothing is 100 per cent risk-free. Therefore, the planned major investments in and expansion of Western Canada Marine Response Corporation (WCMRC) are designed to ensure that Preparedness and Response will leave nothing to chance. The Federal Government’s $1.5-billion (over five years) Oceans Protection Plan and the additional $100 million pledged by Kinder Morgan to boost WCMRC capacity over the coastal route utilized by the project will ensure an unprecedented level of coverage.

Markets

So how are tankers doing in the market? In short, the last few years have been quite a wild ride, exacerbated by the many shipyard orders to convert bulk carriers to tankers from 2012 to 2014 as a consequence of the continuing depressed state of dry bulk markets.

Tanker Class

In Service

On order

VLCC 712 86 Suezmax 522

83

Aframax 979 133 Panamax 441

50

Total 2654 352 LNG Carriers

479

124

Current tanker fleet (Source: Teekay Market Research March 2017) 22 — BC Shipping News — May 2017

Current tanker fleet

The VLCC fleet grew by almost seven per cent in 2016 and, based on vessel orders, seems likely to grow another four per cent or so this year. Overall, the tanker sector grew by a net 5.7 per cent last year, more than for the entire 2013-15 period combined while a further growth of around 4.5 per cent is expected in 2017. This does not bode well at a time when OPEC production cut-backs are effectively being nullified by increased output from the U.S. VLCC rates in the year to date are averaging $25,500 per day compared to $37,000 and $65,000 per day in 2016 and 2015 respectively. A far cry from the spike of six-figure daily returns in 2008/09. On the plus side, more than 20 per cent of the VLCC fleet is more than 15 years old and, given the heavy cost of special surveys not to mention the cost of compliance with the Ballast Water Management Convention which comes into effect in September this year, many are likely to be razor blades in the very near future.

Going forward, tanker rates are likely to be as volatile as ever.

In November 2016, OPEC confounded its doubters and sent crude oil prices soaring by agreeing to its first production cuts in eight years. The agreement, designed to reduce record global oil inventories, overcame disagreements between the group’s three largest producers, namely Saudi Arabia, Iran and Iraq, and ended a market free-for-all that erupted in 2014. It was also broader than many had expected by including non-OPEC countries, with even Russia agreeing to unprecedented cuts.

However, the efforts of OPEC have been severely undermined by a ramp up of shale production by the U.S. which is now close to 5 million barrels/day. With much of U.S. production now available for export, and thanks to the expanded Panama Canal, the market possibilities for U.S. producers are infinite. It is therefore to be hoped that for Kinder Morgan, shovels in the ground in September this year becomes a reality and that the hard-won project approval gains the broad national support that it surely deserves across the political and philosophical divide.

Captain Stephen Brown spent 21 years at sea where he served as Master for the last five years with Gearbulk Shipping. After coming ashore, he worked in various levels of operational management for Gearbulk Shipping in South Africa, China, Indonesia, the U.K. and Vancouver. He went on to serve as Chamber of Shipping of BC Director (2000 to 2008) and President (2008 to 2016). Captain Brown is currently the owner of West Pacific Marine Ltd., Marine Consultancy and can be reached at westpacificmarine@gmail.com.

LNG

LNG Canada pushing forward despite FID delay

T

wo years has passed since last we checked in with Captain Mark Turner, Senior Marine Advisor, LNG Canada, to learn about the proposed multi-billion dollar stateof-the-art LNG export facility at the old Methanex site in Kitimat. At that time, LNG Canada had just completed its TERMPOL submission; had its Environmental Assessment Certificate accepted by the B.C. Environmental Office; and was working its way through a plethora of regulatory requirements, communications initiatives and logistics studies. Today, in an exclusive interview with Turner, we find the team at LNG Canada hasn’t slowed down one bit and, despite the decision to delay the Financial Investment Decision, the project is still very much alive and making impressive progress to ensure success.

Recap

LNG Canada is a joint venture partnership comprising Shell Canada Ltd. (50 per cent ownership), PetroChina Company (20 per cent), Korea Gas Corporation (15 per cent), and Mitsubishi Corporation (15 per cent). The project includes the design, construction and operation of a natural gas liquefaction

...despite the decision to delay the Financial Investment Decision, the project is still very much alive and making impressive progress to ensure success. plant, utilities, storage facilities, including port construction with marine offloading facilities, and shipping. The facility will initially consist of two identical liquefaction trains, each with the capacity to produce 6.5 million tonnes of LNG annually, with an option to expand in the future with two additional trains, resulting in an ultimate capacity of 26 million tonnes per annum LNG. Located in Kitimat, adjacent to the Rio Tinto smelter, the site has a deep, protected harbour located at the head of Douglas Channel, providing an icefree shipping route to the Pacific Ocean throughout the year.

LNG carriers, with capacity between 130,000 to 170,000 cubic metres, will transit via Hecate Strait, through Principe Channel, the Otter Channel, Lewis Passage, Wright Sound and into Douglas Channel. In addition to an enhanced bridge team and lookout personnel on board, two coastal pilots and an escort tug will accompany the carriers

Artist’s rendering of the LNG Canada terminal proposed for Kitimat.

24 — BC Shipping News — May 2017

between Triple Island and the terminal.

The entire route from Triple Island to Kitimat is 160 nautical miles with transit time and speeds varying to accommodate other commercial traffic, whales or activities like fishing and recreational boating.

Status

In July 2016, the joint venture partners announced a delay of their Final Investment Decision, originally scheduled for late last year. Despite some downsizing of staff, Turner reported that the team of about 100 have been moving full-steam ahead to ensure the project is in the best place possible for a Final Investment Decision.

“The global energy market and the affordability of the project in that context prevented our joint venture participants from taking an FID at that time,” Turner said. “However, they are committed to taking an FID when these conditions improve, and the project has demonstrated it remains cost competitive Photo courtesy LNG Canada

against other investment opportunities.

During this period of delay, LNG Canada has been spending time and resources to examine ways to protect the value already invested in the project, as well as to bring costs down, while keeping performance targets for greenhouse gas emissions and environmental performance at worldclass levels.”

Indeed, Turner and his team have received key regulatory approvals, including: • A voluntary TERMPOL review process with a comprehensive safetysensitive risk assessment from Triple Island to Kitimat; • An Environmental Assessment Certificate; • An Oil and Gas Commission facility permit; • A National Energy Board 40-year export licence; • Satisfaction of all regulations under the Navigation Protection Act; • Fisheries-related permits and more.

Turner spoke highly of government and marine industry professionals who have worked with them to fulfill many of the requirements. “Transport Canada, Canadian Coast Guard, the Pacific Pilotage Authority, BC Coast Pilots Ltd., and Canadian Hydrographic Services, just to name a few, have all been very responsive,” he said. “From collaborating on risk mitigation and navigation aids, to accompanying us during simulation exercises and even assisting with presentations to the community, they’ve been fantastic.”

In terms of site preparation, Turner reported that a number of contracts have been awarded and additional RFPs are either in progress or about to be issued.

To give an example, a few of the contracts awarded so far have gone to the likes of Leavitt Machinery (for equipment and servicing), Ledcor-Haisla Ltd. (for early construction consultancy, creek diversion and site preparation), and Boskalis Canada Dredging & Marine Services (for marine dredging). Currently, a Request for Proposal has been issued for a Main Plant Engineering, Procurement, and Construction (EPC) contractor; and RFPs for demolition of the Methanol terminal and construction of a marine habitat offset will begin this summer and early next year respectively.

“Identifying a single EPC contractor will reduce risk and bring more certainty

to the project,” said Turner. “The cost to engineer, procure and construct the LNG Canada project makes up a significant part of the FID. Hiring a single prime contractor — responsible for the Front End Engineering Design (FEED), planning of construction execution, and managing the various subcontractors and employees required for site construction and building of the facility — reduces the project risk for our joint venture participants, brings more certainty to the costs, and delivers the best outcome from a schedule basis and lowest capital expenditure.”

Noting the complexity of the project, Turner estimated it would take some time for the contractors participating in the RFP process to work through their plans and numbers before submitting proposals, and further time for LNG Canada to review them and identify a preferred contractor. A date hasn’t been established for the award.

First Nations and community engagement

While both the regulatory and site preparation activities are ongoing, the

Mark Turner, Senior Marine Advisor, LNG Canda.

LNG Canada team continues to engage with First Nations and the Kitimat and surrounding communities. “We continue to make social investments that focus on activities and initiatives that are useful, desirable and beneficial to the community, align with our core values, and benefit our own employees who will be living in the community during construction and operations,”

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LNG Nation, adding to agreements already signed by Metlakatla, Lax Kw’alaams, and Kitselas. Additional agreements are being worked on with the Kitsumkalum and Gitxaala First Nations as well.

“We respect First Nations’ relationship to the land and sea, including their traditional rights and title,” Turner continued, “and, in addition to developing areas of mutual benefit, we have demonstrated how energy development in First Nations’ traditional territories can achieve success.” To that point, Turner confirmed LNG Canada’s commitment to local employment and contracting, where possible, and described their investment in supporting local training programs and initiatives focused on youth and skilled labour.

In terms of designs and execution to date, Turner said that LNG Canada has made every effort to use energy efficiently, water wisely, and limit the impact of activities on the natural environment.

“We believe we have demonstrated that global energy firms can bring their considerable technological knowledge and innovative thinking to develop resources sustainably,” he said, adding that “our greenhouse gas targets during operations are among the lowest of any LNG facility in the world.”

The big picture

When asked about an estimated timeline for the FID, Turner said the decision depended on the global markets, but that

Photo courtesy LNG Canada

said Turner, adding that a Community Advisory Group provides great local knowledge that helps LNG Canada to make informed decisions about projects.

“From the outset, we have contributed to a wide range of programs, services and community initiatives. Our social investment and workforce development contributions total more than CAD$2.3 million so far — investments ranging from supporting Kitimat and Terrace Community Foundations to purchasing new equipment for the hospital. Our most recent contribution to the District of Kitimat’s Emergency Notification System is a perfect example of a social investment that is a benefit to the community and our workforce, and aligns with our values.”

Working with many First Nations, including the Haisla, whose traditional territorial lands will be the location of the project, as well as the Gitga’at, Kitselas, Metlakatla and Lax Kw’alaams, Turner described how LNG Canada was committed to the process of building relationships based on open and honest communications. “Working collaboratively with First Nations, the local community, non-governmental organizations and local, provincial and national levels of government has helped LNG Canada advance towards its goal of becoming the project of choice in northern B.C.,” said Turner, noting that an LNG Benefits Agreement was recently signed between the province and Gitga’at First

The Granatina, with a capacity of 140,000 cubic metres, is typical of the size of LNG carrier to be used for LNG Canada’s exports.

26 — BC Shipping News — May 2017

the joint venture partners still believe the LNG Canada project is the best vehicle to get B.C. and Canada’s resources to Asian markets. “This industry won’t have any negative impact on rails or the environment, and its safety record is beyond reproach,” he said. “While some are calling it the fuel of tomorrow, I would go as far to say that it’s already the fuel of today.”

“The gas industry in Canada, and globally, is in the midst of a downturn, but we’re taking a long-term view,” he said. “Scenario planning suggests that global LNG demand, which is currently at about 265 million tonnes per year, will double by 2030, assuming there is sufficient additional investment in supply.

Decisions on investment are made based on a 40-year horizon. That outlook for LNG supports Shell’s view on the critical role gas will play in the transition to a low-carbon future.”

While many expected a strong increase in new LNG supplies would outpace demand during 2016, instead, the outlook showed demand growth kept pace with supply as Asia and the Middle East absorbed the increase in supply from Australia.

Once an FID is made, it will take about five years to build the plant, “meaning we are well placed to take advantage of a plausible scenario that shows a supply gap emerging in the early 2020s,” Turner said.

Whether any, or which, of the other 18 proposed projects still showing on the Government of B.C. website will reach a successful FID, Turner couldn’t speculate. But what he did say was that “the number of projects demonstrates how important B.C. is for the export of gas to other markets.”

The vice versa is also true — the industry is important to local communities, B.C. and Canada in order to keep pace with the rest of the world and be able to comply with greenhouse gas emission issues and climate change. “Natural gas is recognized as affordable and the cleanest burning fossil fuel,” Turner said. “For countries that depend on coal for the majority of their energy needs, using LNG has the potential to greatly reduce their GHG emissions and significantly improve air quality. LNG plays an important role in meeting energy demands while addressing the world’s climate change challenge.” BCSN

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INTERNATIONAL SHIPPING

Vancouver’s window of opportunity to build a global maritime business hub

A

recent study published by Monitor Deloitte identified Vancouver as one of the top five international maritime centres that is becoming increasingly important for future investment decisions by ship owners. The study was commissioned by the European Community Shipowners’ Associations to identify risks in losing their traditional leading position as a global maritime hub. It is important to note that the Deloitte study identifies the Vancouver International Maritime Centre (VIMC) as a key factor in the increased competition from Canada to encourage ship owners to establish their primary business activities in Vancouver.

So what — and who — is driving the initiative that has the EU so worried? Enter the VIMC’s team: Kaity Arsoniadis-Stein, Executive Director; Graham Clarke, Chair; Yvonne RankinConstantine, Director, International Business Development; support staff, consultants and many local industry partners who have been revitalizing the initiative that, in the 1990s, attracted the likes of Teekay, Seaspan, Valles Steamship, Oak Maritime and Fairmont Shipping to Vancouver.

The EU and the other countries identified by Monitor Deloitte — Hong Kong, Shanghai, Dubai and Singapore — clearly recognize the benefits of creating maritime hubs.

The spin-offs are enormous. In just under two years, VIMC has attracted two shipping companies (AAL Shipping and Greystoke) and one of the largest maritime legal firms in the world (Norton Rose Fulbright) into Vancouver. In the last 12 months, these two shipping entrants have created 126 direct and indirect jobs and an investment return of $40 million — and have a five-year projection of creating 283 jobs and a $241 million investment return.

Given such significant numbers and an incredible return on a $5-million investment, it’s no wonder that the VIMC has the

Image courtesy VIMC

Figure 1: The value pyramid of a maritime cluster.

28 — BC Shipping News — May 2017

...Deloitte identifies the VIMC as a key factor in the increased competition from Canada to encourage ship owners to establish their primary business activities in Vancouver. support of both provincial and federal governments and works closely with representatives from each to espouse Vancouver’s message that Canada is a stable, neutral, safe country with a strong banking and financial system, along with straightforward regulations and tax regime. These are the business factors that drive international investment.

From the international perspective

As proud Vancouverites, VIMC’s Executive Director and Chair are obviously biased to “why Vancouver,” so BC Shipping News sought out Yvonne Rankin-Constantine, a Scot with over 25 years of senior executive experience globally in both energy and maritime sectors, to provide the international perspective of Vancouver’s true potential as a major global shipping hub.

“I arrived in Vancouver in May 2015, believing I could add value to the local market with my international finance, M&A and management experience,” she said. “I quickly realized that this is a unique market, but was rather surprised to find there were not many head offices located in Vancouver.” Indeed, Rankin-Constantine has worked in over 20 countries on four continents and has a reputation for taking organizations from strategy through to successful execution. With the benefit of her international experience, Yvonne is able to appreciate the market idiosyncrasies and potential of Vancouver.

“Both the energy and maritime markets are challenged in Vancouver,” she said, “but both have such amazing potential to be internationally competitive. That’s what attracted me to the VIMC — their belief and commitment in increasing Vancouver’s profile to international shipping companies showed me that they get it. They understand the potential jobs and GDP impact by having these companies create a Vancouver presence.”

“And there are none better suited than Kaity and Graham to make this happen. With years in the industry and connections that span the globe, their progress to date is nothing short of phenomenal,” Rankin-Constantine said, explaining that other markets have made investments that dwarf the VIMC’s budget without making as much progress.

Echoing the words of the Honourable Marc Garneau, Minister of Transport Canada, Rankin-Constantine described Canada as a “maritime trading nation” but that it takes a holistic approach to truly capitalize on that title. “Billions of dollars have been spent on infrastructure improvements in ports and terminals to facilitate throughput of cargo and, while that’s very important, the VIMC is more focused on creating an environment that will attract the high-value, highly skilled clean jobs which are actually driving global trade.

These careers go beyond the local economic activity generated when a ship enters the port. These are the ‘white collar jobs’

— the accountants, lawyers, financial and banking experts, insurance brokers, and others who are facilitating global trade and, by extension, generating even more business to take advantage of the infrastructure investment.”

To illustrate her point, RankinConstantine provided a value pyramid of a maritime cluster and the type of activity that is attracted by locating operations offices locally (Figure 1). She also provided an overview of the GDP contribution of maritime corporate activities in other countries (Figure 2) to demonstrate the dollar figures at stake. “Canada currently is not capitalizing on this potential to significantly grow its GDP,” she said.

“Just look at the figures for Singapore ($21 billion) or Oslo ($28 billion) for example. What an opportunity!”

Figure 2: Shipping’s GDP contributions around the world.

Alliance of Canada, are secure for one more year, the VIMC will be looking to renew the partnerships for another five years beyond that. Rankin-Constantine feels there’s a strong business case for continuing the work.

“The timing is right,” she said. “At the global level, there is a great deal of uncertainty within the international business community — and maritime business hates uncertainty. Our message that Canada is safe, financially sound with stable governments and a high standard of living, is like music to the ears of the maritime business world. And without the efforts of the VIMC, Vancouver, and indeed Canada, would not even be on the radar of international ship owners.”

Rankin-Constantine ran through a very long list of maritime events, trade shows, meetings, correspondence and activities that have all served a single

A good problem to have

Photo courtesy VIMC

To take full advantage of the opportunities that increased corporate maritime activities will offer, the VIMC recognized the potential of a skills gap and built in an education component to their overall strategy. To that end, Kaity Arsoniadis-Stein has worked with both local and international partners to develop a Memorandum of Understanding between the University of the Aegean’s School of Business in Greece and UBC’s Sauder School of Business. The agreement builds on Sauder’s activities to develop an international network focused on business studies.

It doesn’t stop there. VIMC is in discussions with the University of Southampton, the Institute of Maritime Law, Southampton, and Norton Rose Fulbright to develop maritime programs that would address local requirements, reflecting Norton’s growth forecast of 25 per cent for their activities in this market.

And additional initiatives are at various stages of development. Working with key local institutions like BCIT and the University of Victoria’s Peter V. Gustavson School of Business, Arsoniadis-Stein and her team continue to investigate new ways to facilitate the growth of the maritime industry in Vancouver and to ensure its sustainability by investing in home-grown talent.

purpose: “We haven’t stopped,” she said.

“It’s an aggressive strategy that we’ve put in place and we’re seeing great progress but companies just don’t move overnight (at least, you hope not!). The lead time can be two to three years as companies research the local market and build a business case for their investment in Vancouver, Canada.”

Before closing off, Rankin-Constantine offered the following insight: “I’ve travelled all over the world, worked with leadership teams, banks, markets and governments, and never have I seen such potential for a country. Deloitte’s recognition of Vancouver as a leading maritime hub, demonstrates the impact of VIMC’s branding of Vancouver on the global stage. I just hope the governments build upon their current success and support VIMC to embrace this significant window of opportunity.” BCSN

Looking to the future

While funding agreements with both federal and provincial governments, as well as the International Ship-Owners

Yvonne Rankin-Constantine and Kaity Arsoniadis-Stein with the VIMC. May 2017 — BC Shipping News — 29

INTERNATIONAL SHIPPING

All hail THE Alliance?

By Chris Gould

T

he month of April sees Japan cloaked in a blanket of resplendent pink as the sakura, or cherry blossoms, reach full bloom. Sakura is synonymous with the start of a new fiscal year; the season of new beginnings and fresh hopes. This year, the seasonal mood can perhaps best be summed up the newly-formed “Alliance” of Japan’s Big Three shipping companies, who have merged their container operations in a bid to ride out recent market storms.

And with so many of THE Alliance’s ships docking in Vancouver, West Coast Canadians may legitimately ask: what’s in it for us?

Who are the main players?

Spearheading the new organization is NYK Line, which celebrates its 132nd anniversary in September this year.

Aligned with the formidable Mitsubishi Group, this Tokyo Stock Exchangelisted company boasts 35,000 employees and an enormous fleet of 782 ships, of which the Seaspan Zambezi (Aframax) and NYK Nebula (Panamax) visited Vancouver in April. The company’s take on the market has been summed up by CEO Tadaaki Naito as follows: “2016 was something of a perfect storm,

The new super-company will command a 6.5 per cent market share — making it the sixth largest container shipping firm in the world... culminating in a record-low Baltic Dry Index (BDI) and the collapse of the Hanjin Shipping Company. However, the tide began to change last autumn.

Improvements in the shipping market led me to perceive a small gap in the clouds, revealing the distant silhouette of a shining island. It looks like 2017 will see the shipping market enter the process of rebounding. Rather than hope for a clear blue sky right after the typhoon, I want to plot a firm course which leads us to an even brighter blue sky post-2018.”

The second Alliance member is Mitsui OSK Lines (MOL), a company seven years older than NYK and aligned with the Mitsui Group — arch rival of the Mitsubishi Group. The company commands 830 vessels, of which the Seattle Bridge and Guang Dong Bridge (both Panamax) will journey to Vancouver in the coming weeks. CEO Junichiro Ikeda explains that: “Having acknowledged the shipping environment has greatly changed, our company is drawing

up a management plan that will lay the groundwork for the next 100 years. The new financial year will see us embark upon our new medium-term management plan, under our long-term theme of: ‘how strong a bond can we forge with our customers?’ And to achieve these strong bonds, we not only need constant communication, but to provide them with a stress-free service, to make them feel that we are easy to do business with.”

The third partner is Kawasaki Kisen, popularly known as K Line. The company originally belonged to Mitsubishi Heavy Industries, but broke away in 1919 and now occupies the status of a “friendly Mitsubishi customer.” It currently operates a fleet of 524 ships, including the George Washington Bridge (Supramax), which graced the West Coast on April 19. Charismatic CEO Eizo Murakami believes that: “2017 will likely be a year for patience, as the shipping market works towards genuinely recovering in 2018-19. Since last autumn, there has been an upward trend in container shipping and dry bulk. The year-end left clear indications that the market cannot dip any lower. Even so, demand increases remain modest at best and supply pressure remains strong, meaning that prices are unlikely to rise much during this year. So right now, we focus on the transfer of our container shipping business to the new company, and look ahead to our 100th anniversary in 2019.”

What exactly do the members hope to gain?

THE Alliance vessels are frequent visitors to the West Coast.

Photo: BC Shipping News

30 — BC Shipping News — May 2017

As Murakami recently stated, THE Alliance should deliver considerable benefits accruing from economies of scale. The new super-company will

command a 6.5 per cent market share — making it the sixth largest container shipping firm in the world — and anticipates yearly revenues of some 2trn JPY (17.9bn USD). The merger is also expected to generate synergies of 110bn JPY, an amount which slightly exceeds the combined losses of the Japanese triumvirate in FY2016. And according to Japanese shipping expert Shinji Goda, there are clear long-term objectives being pursued.

“This is not simply a knee-jerk reaction to the Hanjin collapse,” he said.

“The three companies had been talking about this for some time, with NYK taking the lead and the majority shareholding (38 per cent). It seems that the NYK distribution system will be followed as it is deemed to be the most efficient.

There is talk now of the new company’s headquarters being located in Singapore for strategic reasons, and a much leaner, more cost-effective organization emerging in the long run.”

A forgotten aspect of this story is that Japan’s Big Three will also be partnered by two foreign companies: Yangming of

Taiwan and Hapag-Lloyd of Germany, thus further expanding their strategic reach.

The new super-company should also be able to secure more favourable shipbuilding contracts, according to a spokesperson for one of its chief suppliers, Mitsubishi Heavy Industries. “Until now, we’ve enjoyed the luxury of stable demand provided by our former subsidiary, K Line,”

she said. “However, the three companies together will possess greater negotiating clout and thus enhanced power to switch suppliers. Demand for our ships seems likely to fluctuate more.”

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INTERNATIONAL SHIPPING streamlining and lower procurement costs will translate into more competitive shipping rates. Japan and Canada currently exchange over $25bn worth of goods and raw materials per year, and continue to seek an Economic Partnership Agreement in a bid to further boost this figure. THE Alliance will certainly be watching these negotiations with interest, especially with the Trans-Pacific Partnership now apparently on the backburner.

When interviewed at the recent Gastech Conference near Tokyo, a Government of British Columbia official stated that “while THE Alliance raises concerns from a competition perspective, it is too early to speculate what the impact on Canadian container shipping might be.” In the medium-term, however, the indications are that THE Alliance may share at least part of its destiny with that of the West Coast.

Since the devastating earthquake and tsunami in March 2011, Japan has practically shut down its nuclear reactor network and sought to make up the resultant energy shortfalls with vast quantities of imported LNG. A quarter of the world’s LNG fleet currently rests in Japanese hands, and over 70 per cent of this belongs to THE Alliance.

Canada’s recent drive towards LNG production has been well-documented, with the March 2017 edition of the LNG Journal reporting that no fewer than 12 LNG projects are scheduled for start-up within the next seven years.

Significantly, the LNG Canada project, which aims to build an LNG export terminal at Kitimat, is co-sponsored by the Mitsubishi Group, which has a definite interest in the success of former subsidiaries NYK Line and K Line.

THE Alliance may also play a significant role in delivering greener and more hi-tech ships to the West Coast. The member firms have been more proactive than most in responding to the impending challenge of global Sulphur caps, which will take effect as of 2020. January 2017, for example, saw the official compliance certification of the Hybrid Sulphur Oxide (SOx) Scrubber System, installed aboard K Line’s large-scale car carrier Drive Green Highway. Significantly, the core components of the system can be housed in an ISO shipping container, thus reducing installation times and increasing efficient use of deck space.

32 — BC Shipping News — May 2017

Meanwhile, NYK has generated headlines by commissioning Japan’s first LNG-fuelled ship, the Sakigake.

When operating in LNG mode (instead of diesel), Sakigake’s dual engines were recorded as emitting 30 per cent less CO2, 80 per cent less NOx and virtually no SOx at all. The ship also opens up the possibility of LNG bunkering, whereby a ship can be fuelled by another vessel from the seaward side in ports which find it impossible to install LNG piping in each berth. Not to be outdone, MOL received its first ever Methanolpowered ship last year, designed by the Mitsui Engineering and Shipbuilding Company. Plans for liquid hydrogen vessels designed by Kawasaki Heavy Industries are also in the pipeline.

Finally, in the last few days it has been announced that MOL’s “IT-based Visualization of the Inboard Environment Project” has been selected for official government support by Japan’s Ministry for Land, Infrastructure and Transport, as part of the national “Assisted Projects for Advanced Shipping Safety Technology Development” initiative. The project seeks to provide crew members with wearable headset technology equipped with AR and VR features capable of enhancing operational support and technical capabilities respectively. The technology will form part of MOL’s Smart Ship Project, which also aims to develop an Automatic Forecasting System for Ocean Weather Conditions.

Allied to success?

According to container freight price benchmarking index Xeneta, THE Alliance will face an initial testing phase.

Cargo price competition is expected to be stiff from the rival Ocean Alliance, while K Line is still seeking to re-establish trust after several customer orders were booked on Hanjin ships which were subsequently seized. However, the fact that member firms have established a large contingency fund to avoid a Hanjin-style collapse should ensure that Alliance vessels will be a familiar sight on the West Coast for the foreseeable future.

Chris Gould began his journalistic career at the UK-based Daily Telegraph, before branching out into magazine publications after relocating to Japan in 2008. He currently both writes and translates material on a number of business topics and can be reached at christopher.gould@hotmail.co.uk.

RISK MANAGEMENT

Deplorable footwear and its connection to fleet risk reduction

By Dermot Loughnane CEO, Tactical Marine Solutions Ltd.

Dermot Loughnane draws a line from the state of crews’ shoes, through the chain of causation, to how ships’ managers can improve safety through personal motivation.

A

couple of years ago, an article in Lloyd’s List caused me to ponder. The article was headlined Viking Islay Master ‘ failed in his duty of care.’ I quote directly from the article concerning the actions of some of the crew of the Emergency Response Rescue Vessel (ERRV) Viking Islay that led to their deaths: “The three men successively entered the vessel’s chain locker before collapsing due to depleted oxygen in the enclosed space. At issue is whether the crew members were made aware that the chain locker was a dangerous place to go, whether they were aware the chain locker had to be adequately vented before entry and why no tests were made of oxygen levels in the locker.

“A toolbox-talk risk identification card system was in place as a safety measure but was regarded on board as merely an administrative function rather than a safety device and often signed after work was complete rather than before.”

The stupid thing of course is that the crew entered the locker merely to fasten the hanging chain to prevent it from knocking on the side of the locker and keeping some of the crew awake — and not for the first time.

The basis of the Crown’s case was that the Master owed a duty of care to the crew to ensure they were not unduly exposed to risk. Of course, the Master does have a duty of care to the crew; as I recall it’s to crew, ship and then cargo. I won’t offer an opinion on the Master’s action or inaction, or his eventual acquittal, but I’m sure he suffered in his own hell.

Undoubtedly, there was a confined space entry protocol in the ship manager’s safety management system that was ignored.

Was there a warning about oxidization in the procedure? Was the Master or the first two crewmen aware that oxidization occurs in a chain locker (or with many cargoes)?

The power of ‘duty of care’ to each other

Sadly, I was witness to a similar accident when I was at sea, though I was a supernumerary on the ship at the time. In both incidents, what distresses me the most (besides the Master’s ignorance) was that there were several other people involved who were either ignorant or ignored the procedures and the dangers of entering a compartment that had been closed for some time.

One of the most powerful tools to improve safety on a ship (or anywhere for that matter) is for the crew to have a duty of care towards each other; it’s much more effective than any written procedure. Did anyone else know they were going to go into the chain locker? If so, did it not strike anyone that this was a danger?

Some years ago, I worked in Australia managing a variety of ships. One of the ships was a Floating Storage and Offtake (FSO) vessel on the Northwest Shelf. This FSO was moored to a buoy that was part of the loading system. One of the ship’s responsibilities was to maintain the buoy, which necessitated visits on a frequent basis to clean and inspect the compartments and fittings.

On one of the visits, we had an incident that illustrates the duty of care point very nicely. A sailor on the FSO had a pair of work boots that were basically a few scraps of leather held together by laces (see disgusting photo included). It became a running joke amongst the crew about just how bad the boots were. Inevitably it all came to grief when, one day, the seafarer in question was transferring from a boat to the loading buoy to do the servicing and severely wrenched his ankle (we’re talking medevac and surgery bad).

Out of 17 people onboard, there were 16 who could have interceded to prevent the sailor from boarding the boat with his questionable footwear. The officer in charge, the bosun and every other sailor, officer or catering personnel could have stepped in but did not.

There was value out of the incident though, as it became an excellent object lesson in how safety on board is everyone’s responsibility and, unless everyone is involved, the results can be painful or even tragic.

May 2017 — BC Shipping News — 33

RISK MANAGEMENT A three-legged stool

Consider the operating environment on a ship to be a threelegged stool. One leg is made up of the company’s ISM/ISO system and the multitude of policies, work instructions, and checklists that comprise it. The second leg is the government/ regulatory requirements, which can range from merely ponderous through to the safety case noted above with the Viking Islay.

The third leg of the stool, which is often the weakest, is the involvement of the individual in responsibility for safety, for him/herself and for fellow crew members.

Going back to our shoe-challenged friend on the FSO, at the time of his injury, I was desperately trying to improve the not very impressive Loss Time Injury rate for the Australian fleet.

Out of a worldwide fleet of 180 ships I believe we ranked dead last. While the injury was relatively minor, it was a setback we could have done without.

Graph 1 — Lost Time Injury Frequency, 2002 – 2004.

Graph 2 — Near Miss Reporting, 2004 – 2006

Graph 3 — The resulting LTIF, 2004 – 2006 34 — BC Shipping News — May 2017

As you can see in Graph 1, the LTI rate was unconscionably high for several reasons, one of which was that we were attempting to combine two very different fleets — one of principally dry cargo ships and tugs, and the other of offshore units and tankers. With both fleets having been for sale and having been purchased a short time earlier, there were clashes in culture and systems. In particular, the bulk carriers’ system was more general and the tanker system was much more specific, more so because it was composed of elements of ISM, ISO, OHSAS 18001 (occupational health and safety) and ISO 14000 (environmental management).

Our attack on the LTI rate was multi-fold and relied more on the human element than procedures. Core to the project was quality and safety personnel who were “true believers,” experienced enough to have seen what happens when the system doesn’t work and with a zeal to improve their colleagues’ lot. The message they carried was two-fold, one of personal responsibility for safety, making sure you were safe so that you would return home to your family; and secondly, responsibility for one’s fellow crew members and that they would return home and safe. (This rang particularly true in Australia, where one prime minister wanted to incorporate “mate-ship” into a preamble to the country’s constitution) The message was delivered through presentations to the crew during port calls and at “seafarers’ conferences.” Semi-annual meetings were held in a local hotel and up to 100 seafarers would gather at a time for training, review of fleet performance and Key Performance Indicators (KPIs). A good portion of our ships were employed on long haul trades to Europe and the Far East, but they all came back to Australia at one end of their voyage, allowing easier access to the crew than might otherwise be the case. In addition to the usual channels of emails from the office and newsletters, the workshops provided a valuable platform for communicating and reinforcing the message. I adhere to the maxim that once you’ve communicated your message, and re-sent it so that you’re really, really, really sure that it’s been received, then you send it one more time.

We (by which I mean the HSE staff that worked for me) decided that the best avenue for raising awareness in a measurable way was by promoting the reporting of “near misses” — events which caused an accident with no harmful effects or events which had the potential to cause an accident or harmful effect. To facilitate that, we designed a pocket book containing very simple near-miss forms to fit the breast pocket of crew coveralls.

Then, perhaps most controversially, we established as part of the ship’s KPI, that a minimum number of near misses had to be reported on a monthly basis. That KPI was tied to the bonus compensation of the senior officers on every ship. I recall that out of the 25 ships we had at that point it seemed that every single Master or Chief Engineer remonstrated with me why this was just such a bad/unworkable/unfair idea.

As you can see from Graph 2, the near-miss reporting did increase, and in Graph 3, the injury rate went quite the other way. No doubt some of the near misses reported were the product of imagination but the results were indisputable. Even if creativity was tested in producing the near-miss reports, at least the authors were thinking about safety.

While our main interest was in the reduction of the LTI rate and what it represented, what we in fact found was that

RISK MANAGEMENT several other KPIs also improved. Port state control findings, vetting deficiencies and property loss fell consistently through the years. The vessel availability remained a challenge, while always over 99.5 per cent it was apparently on a downward slope. (In fact, we had one RoRo that was 37 years old and problems with her auxiliary equipment were almost entirely the cause of the glide path to disaster. Once those results were stripped out, the results were more like 99.7 per cent availability, and this from a fleet that averaged 17 years of age with crews of 17 seafarers per ship.)

What is peculiar about shipping is that your most valuable assets and the personnel manning them operate out of your sight and usually at a great distance.

Having the responsibility, through the Master, of those lives while they are doing the work you sent them out to do, I found to be one of the most wearing aspects of managing ships.

Finding the most effective way for crews to keep themselves safe is both the least we can do and the most important

responsibility of the management. The methods employed here I know are not a universal solution.

What is universal is that a consistent message, delivered incessantly by committed managers, and backed by a sincere concern for seafarers’ welfare, will 20170030-GillespieMunro-HalfPage-70yrs_update.pdf

1

2017-01-23

always improve the situation.

Dermot Loughnane is CEO of Tactical Marine Solutions Ltd., a marine management consultancy with the proven ability to evaluate, design or improve shipping systems. He can be reached at dloughnane@ tactmarine.com.

9:22 AM

A RESPECTED NAME IN INTERNATIONAL FREIGHT FORWARDING FOR OVER 70 YEARS

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May 2017 — BC Shipping News — 35

SOCIAL LICENCE

Social licence: Make-believe, nice-to-have, or must-have for a sustainable marine shipping sector?

Dr. Richard Wiefelspuett ...while there is widespread consensus that the industry supports businesses and lives across the country, it is no secret that marine shipping operations face increased public scrutiny...

D

uring the last two years in my former role as the Executive Director of Clear Seas Centre for Responsible Marine Shipping, I have listened to folks across the country and explored their views related to safe and sustainable marine shipping on Canada’s seaboards. When probing the issues of trust, legitimacy and consent, I discovered a wide range of attitudes and opinions, as can be expected from a diverse base comprising industry, government, NGOs, Indigenous groups, environmentalists, scientists and the public at large. And while there is widespread consensus that the industry supports businesses and lives across the country,

it is no secret that marine shipping operations face increased public scrutiny along our coasts.

Cases in point are the governments’ approvals of the Kinder Morgan pipeline and LNG export terminals in B.C., which have received heightened community attention. And there is no denying that these projects have a direct link to the marine shipping sector.

These developments evoke Justin Trudeau’s statements that “…governments grant permits, but only communities grant permission…,” and “…that is something that we need to spend more time focusing on…”

In a roundabout way, these statements address the concept of social licence.

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It is not only Trudeau’s statements that provide validity to the concept of social licence. During their recent “What is Social Licence?” event, the McGill Institute for the Study of Canada explored, with four panelists — each renowned in their respective fields — the complexity of social licence. For me, one of the highlights of the evening was the contribution of Jim Cooney, a prominent figure of the international mining industry. Jim explained how he, some 20 years ago, introduced the term “social licence” in the process of relationship building between mines and communities. What a remarkable historic factoid! Not surprisingly, 20 years after the naissance of social licence, there exists an abundance of publications on the topic with references to the mining sector.

The available literature examines the nature and attributes of social licence and documents it’s growing importance as a critical success factor for resource developments. In summary: • Social licence is generally defined as a local community’s acceptance of a company’s project and enduring presence in a region.

• Stakeholders and communities consider it increasingly as a pre-condition for development.

• Social licence is acquired outside formal regulatory processes, and depends on the build-up of social capital within trust-based relationships.

• Social licence is, by nature, intangible and informal but can be achieved through robust processes including timely and effective communication, genuine dialogue, and consistently ethical behavior.

In a nutshell, guiding principles that support these processes include accountability, transparency, human rights, environmental protection, OHS for employees and communities, respect for cultural customs and values, an active

SOCIAL LICENCE and ongoing dialogue about community priorities and needs through all stages of a project and providing long-lasting benefits to communities.

Social licence to operate (SLO) — that tacit approval by a society for an industrial activity — is a central aspect of any discussion related to energy transportation and export, by pipeline, by rail or by ship — certainly today and certainly in B.C., with its history of legendary clashes between industrial and environmental interests. The oil sands sector in Alberta, pipeline operators, and the embryonic LNG industry in B.C. have been hard at work to gain ongoing societal approval for their operations. Downstream, the marine shipping sector with its terminals, ports and ships, forms an integrated and critical part of the hydrocarbon supply chain. As such, the sector cannot risk disruptions of the kind seen in Seattle in May 2015 when activists locked themselves to the Arctic Challenger’s anchor chain to delay the vessel’s departure, or earlier, when hundreds of “kayaktivists” swarmed a bay to protest Shell’s plans for drilling in the Arctic.

Gaining social licence and proactively establishing ongoing community and stakeholder support for any planned operations will go a long way in avoiding such troubles. However, this will be a dissimilar challenge for marine operations since there are several differences between the operational parameters of the shipping industry compared to other sectors. Due to the international nature of maritime transport and the lack of direct interactions between shipping companies and the coastal communities along the shipping routes, the motivation to establish social licence may not be as pronounced as in the typically immobile resource and pipeline operations.

This could also be the reason why the marine sector has been late in recognizing the value of the concept of social licence.

It is not unusual for prominent figures in the industry to disrupt related discussions with claims that there is no such thing as social licence; that it is an invalid concept all together. Social licence may not be tangible and it is much easier to notice its absence than to recognize its presence, but there is no shortage of case studies to document costly delays, legal deadlocks and out-and-out failure when proponents did not bother to engage with affected stakeholders early on: to acknowledge

their concerns, to address risks transparently and to share the benefits of the intended operation fairly. Similarly, it has been shown that merely relying on regulatory compliance is too narrow an approach to secure a sustainable operation.

The existing playbook for the mining industry has been developed for the specific requirements of the resource sector and cannot simply be copied backto-back to develop similarly robust processes for the entire marine transportation segment. But taking a closer look, the critical success factors for expansions and operations of ports and terminals are not that dissimilar from the requirements for positive mining operations. Also, most of the quoted guiding principles are already an established part of today’s vocabulary within the marine sector, with a few palpable exceptions. The inherently transient character of international shipping remains an obvious differentiator from mining operations and other sectors in permanent locations, and with a direct and long-lasting community interface. This element will require a novel approach.

Here, government has an opportunity to play an important role, facilitating the dialogue between coastal communities and industry interests within a regulatory framework that focuses on prevention and supports a credible narrative that everything possible will be done to prevent

bad things from happening. Canada’s Oceans Protection Plan provides some leverage for a constructive collaboration between government, industry and coastal communities.

Conclusion

Social licence for a sustainable marine shipping sector is obtainable. With specific reference to the shipment of hydrocarbons, social licence will be highly beneficial as it will help to eliminate costly disruptions of the supply chain. In view of the established value of social licence in the mining sector, and with respect for the valiant efforts undertaken by the oil sands, pipeline operators and LNG proponents to obtain it, the position to dismiss social licence as “make-believe” is not defendable. Is it a “nice-to-have” or “must-have” for a sustainable marine shipping sector?

Consider the options of enjoying the trust, legitimacy and consent of a community versus being denied these attributes. As a first step, it will require the marine shipping sector to acknowledge the elephant in the room and consider the needful efforts to obtain its SOL. (BC Shipping News has committed to exploring this issue in future editions).

Dr. Richard Wiefelspuett is a Marine Transportation Consultant and can be reached at: richard.wiefelspuett@gmx.de.

May 2017 — BC Shipping News — 37

CLASSIFICATION SOCIETY

Realizing the benefits from LR’s re-organization

I

n last year’s December issue of BC Shipping News, Nick Brown, Marine and Offshore Director for Lloyd’s Register (LR), described some of the fundamental changes occurring at the 257-year-old classification society. Now, in an exclusive sit-down interview with Mark Darley, President – Americas Marine and Offshore; Bud Streeter, Regional Naval Business and External Affairs Manager, Americas; and Ben Thompson, Area Client Relations Manager, North America West, LR explains how that re-organization and the resulting alignment of resources is clearly having a beneficial effect — not just on LR, their clients, regulators and technology companies but, ultimately, on the shipping industry as a whole.

A central theme in guiding the reorganization of LR over the past year has been the forward-looking strategy of ensuring adaptability to today’s continually changing world. Since the ascension of Alastair Marsh to the CEO position in early 2016, LR has evaluated its services, organizational structure and the required skillsets that will keep the company at the forefront of technological change and deepen its impact on the maritime industry.

Mark Darley 38 — BC Shipping News — May 2017

...the resulting alignment of resources is clearly having a beneficial effect — not just on LR, their clients, regulators and technology companies but, ultimately, on the shipping industry as a whole.

Bud’s new role

In one of the best examples of matching the right skillset to the right position, Bud Streeter has recently taken on the role of Regional Naval Business and External Affairs Manager for the Americas, falling within the team led by Tom Boardley, Executive Vice President and Global Head of Corporate and External Affairs (see the BCSN interview with Boardley in the July/August 2016 issue). Referring to Boardley’s team as “strategic country ambassadors,” Mark Darley described the different functions that provide a focus for each LR staff person, be it operations, client relations or growing the business through the development of new service products.

During the transition period last year, LR realized that they could play a larger role in working with regulators to help shape policies in support of the maritime industry. “In the U.K., for example, we’re working closely with the government

to help them understand the impact of Brexit on the shipping industry.” While this type of assistance has always been a part of normal business for LR, CEO Alastair Marsh saw it as a separate function with greater organization to be able to leverage international resources.

The other part of Streeter’s mandate includes naval responsibility for the Americas. While the U.S. naval market is a “tough nut to crack,” Streeter utilizes the team’s knowledge and experience with the Canadian Navy and Canadian Coast Guard to assist governments throughout Central and South America.

“It’s about translating that leadingedge thought process for countries and projects that might not have the same resources and experience that we have up here in Canada. And I’m able to draw upon the experiences of my colleagues in other parts of the Americas and globally — it allows us to use our resources more effectively.”

Bud Streeter

Ben Thompson

CLASS Enhancing capabilities

The new role for Streeter provides a good example of the structural changes within LR. Darley explained that much of the re-organization has been done to ensure that the basics and consistency of service are in place to be able to respond to clients in a timely manner but also to help with the changing dynamics of the industry. “We decided to separate functions between ‘client relations,’ which looks after the existing client base to address day-to-day operations but also have exploratory conversations about new technologies and processes,” Darley said, “and this new function which looks at developing new service products and activities that are impacting on the maritime world,” Darley said.

He continued, “We’re in a better position now to support our existing clients but also to provide support for new client bases as well as support to existing clients for understanding and implementing new technologies and initiatives.”

Darley further noted that, in addition to greater efficiencies, additional staff has been added to the business development role — “people who are dialled into the global conversation about where LR sees its place as a future class society.”

Increasingly, that role is becoming more focused within the scope of data digital and software, but, Darley notes, “to be able to do that, you have to first understand it.” He went on to say “What we’re seeing is that no two clients have the same cyber or data digital strategy — the same challenges, the same technology or internal capabilities to deal with this conversation.” That’s where Darley feels LR is more than a class society — they are an “industry enabler,” bringing in the ship operator, the OEM and the technology company that may even come from one of LR’s other business streams.

“We’re seeing technology from our oil and gas division, or from companies engaged with our management systems business,” he said, “and our strength lies in being able to facilitate that collaboration. Further, in addition to holding these conversations globally, we’re able to bring it to clients locally in B.C.”

Innovation applied

To illustrate his point about how the organizational changes are resulting in new service products, Darley discussed the recent launch of Lloyd’s Register’s

Thompson is scheduled to speak at the upcoming Towboat Industry Conference in June to provide an assessment of the Delegated Statutory Inspection Program in detail.

Cyber Secure services, a program that provides clients with a wide array of services, from guidance and training to vulnerability and impact assessment.

Launched at Seatrade in Florida this past March, Cyber Secure is the result of a number of pilot projects started several years ago. “LR has been spending the last few years growing its software engineering capability,” said Darley. “We receive data from clients and, from that data, identify the benefits that LR can provide back to its clients in terms of safety, cyber security, etc.”

LR has also made a significant investment in QIO, a company that has developed a platform for industrial engineers and manufacturers to rapidly deploy advanced analytics. “QIO will become LR’s preferred platform for LR’s clients to send their data so we can do the analytics,” Darley responded when asked about access to data. “Clients like our independence and we have a legacy of trust established so they are comfortable working with us to provide analytics that offer some real benefit.”

And yet another development within LR is the acquisition of SeaSafe Marine Software & Computation Ltd., a company that provides naval architecture computations which enables LR to enhance their existing ship emergency response service. The software application performs all statutory required calculations on board or in an on-shore office, and has a rich variety of features from specialized loading operations to advanced intact and damage stability calculations.

And this is just a highlight of the many initiatives underway. Other technologyrelated pilot projects are covering the spectrum of the entire life cycle of a ship and operations, including the human factor. “For example,” Darley noted, “we’ve been working with a number of owners to look at tracking onboard statistics for issues like alertness and fatigue by using technology — a hat or a wrist band that monitors alertness.” Additional technologies being investigated to determine if there are benefits for the shipping industry include drone technology and nano-technology.

When asked how all of these technologies will affect the traditional job of the surveyor, Darley imagines a future with a diverse range of skills in surveyors.

“There are different skillsets required and it means hiring more people like software engineers on top of the existing grass roots engineers and architects that we have today.”

At the local level

Bringing the conversation back to the local level, Ben Thompson and Bud Streeter provided an update on the Delegated Statutory Inspection Program (DSIP) which has now been a policy in Canada for 10 years. In fact, Thompson is scheduled to speak at the upcoming Towboat Industry Conference in June to describe the program in detail.

With 80 per cent of the classed vessels in the program, LR is the largest Recognized Organization (RO) authorized by Transport Canada. “The majority of vessels over 24 metres have been dealt with,” said Streeter. “We’re now looking at other vessels over 24 metres that aren’t necessarily going to be replaced, so we have been working with Transport Canada to come up with a process where, even if the vessel wasn’t classed with LR, we can survey, certify it and issue certificates. This addresses the policy of having 24-metre and above vessels being dealt with by ROs.” Streeter also outlined the policy relating to vessels that have been built to older rules and have been surveyed through varying regimes. “We initially had some concerns, but we’ve worked with Transport Canada to develop terms that protect both LR and TC. By doing very good upfront, hand-over inspections and understanding why they are how they are, an existing vessel that isn’t in class; was inspected by Transport Canada; and is over 24 metres, can apply to an RO for survey, and if it turns out to be too expensive, there’s a hardship clause that allows them to stay with TC. Also very important to note is that we don’t inspect the vessel based on new rules. We inspect them to the rules that were in effect at the time of the hand over and secondly, if any new rules come in that apply to May 2017 — BC Shipping News — 39

CLASS existing ships, we will apply those rules on behalf of Transport Canada.”

A world first

As described in the April issue of BCSN, Lloyd’s Register classed the three Salish Class, LNG-dual fuel vessels entering the fleet for BC Ferries. “They are the first passenger vessels in the world to be fuelled by truck on board,” said Thompson, who worked with BC Ferries, Remontowa, Transport Canada and FortisBC to approve the design and process.

“One of the issues we saw when we did the LNG study for the Port of Vancouver was that shore-to-ship bunkering works very well for long runs but for short runs, like the Salish Class or the new Seaspan vessels, it makes sense not to tie up a lot of space with fuel tanks and cryogenic equipment. It’s easier to match fuel carriage to voyage length and trucks make a lot of sense because it reduces the need for on-site storage which, in the long run, reduces risk.”

While noting that all bunkering methods have built-in safety and risk management procedures, Thompson described

40 — BC Shipping News — May 2017

how truck-onboard-bunkering alleviates the need to deal with the relative motion between ship and shore and movement of the bunker line. He also noted that “BC Ferries has been bunkering diesel fuel like this for decades so they’re familiar with using diesel trucks on board. LNG is another fuel, with characteristics that required a modified bunkering station design and an incremental change in their procedures.”

A bright future for B.C.

The changes at LR on a global scale will benefit B.C. on other levels as well — for example, the future of LNG as an export. “We’re coming off the back of low oil prices and we’re starting to see more of the LNG terminal development projects warm up again,” said Darley.

“Between now and 2021, the forecast predicts a 46 per cent increase in global liquefaction capacity. At the provincial level, we’re seeing a desire to be a part of that capability — to have that gas on the market and globally trade it.” Darley cited the example of China’s recent announcement to reduce its reliance on

coal by 30 per cent by 2020 as an indication that any oversupply in the current LNG market will be reversed by that demand. “It’s these early injections of positivity, globally, that has meant that countries and companies are going back to the projects to see which to switch on.”

Over and above LNG terminal development, projects in B.C. are keeping LR busy. “There’s a lot going on,” said Streeter, “naval construction, commercial and terminal work, especially in Prince Rupert where we were involved with the new stacker reclaimers and a number of other projects.”

While the re-organization of LR across the whole of the Americas was in response to a changing world, Darley notes that the results have been impressive to date. “As an organization, we wanted to be able to respond quickly but also to be able to better support our client base — be it an owner, an operator or a yard. We’re much more active now but more focused as well.”

For B.C., that greater presence and focus comes at an opportune time.

BCSN

TECHNOLOGY

New hatch testing service employs ultrasonic technology

By Jim Drummond, Canadian Maritime Engineering Ltd.

C

anadian Maritime Engineering Ltd. (CME) is pleased to announce it now offers UltraSonic Hatch Tightness Testing services on both Canadian Coasts. In partnership with SDT HearMore, manufacturers of the Sherlog Ultrasonic Hatch Tightness Test equipment, CME has trained a team of surveyors to begin hatch testing this summer. With Class Type approval and recognition by Lloyd’s Register and the Nautical Institute, ultrasonic hatch testing is the standard all ship owners, cargo companies and insurers should demand.

Why ultrasonic testing over other methods? To summarize, ultrasonic testing is more cost-effective, efficient and more reliable than any other method currently used. More specifically, ultrasonic testing can be performed quickly and uses fewer resources than traditional hose, light or chalk tests. Ultrasonic testing can also be done with the ship fully loaded, realizing its full load structural deflection as it exists during an ocean crossing, unlike the commonly performed hose test which must be done on an empty cargo hold in case there are any leaks that could potentially damage cargo. As ultrasonic testing is a dry, non-invasive inspection, other cargo and deck activities can occur without interruption from an unwieldly fire hose soaking the deck, running off the ship and soaking the loading docks.

Ultrasonic testing has a proven track record, dating back to 2003, of being a highly accurate and reliable method of determining water tightness of hatches.

Loss prevention and lower insurance premiums are just two reasons to consider switching. Records of inspection are logged into the testing equipment and used to generate reports of compliance that satisfy all the legal requirements set out by class and industry.

Ultrasonic testing can be used for a variety of other things beyond hatch testing as well. Ultrasonic test equipment and software allows for preventative maintenance programs to be implemented that detect defects before traditional thermal imaging is capable of. These programs allow for condition-based monitoring and maintenance as opposed to interval-based maintenance, saving time and offering maintenance routines that are easier to schedule because indications of failure

appear much earlier than other testing methods. Repeatedly over greasing bearings can actually destroy them and cause failure prematurely. Monitoring lubrication routines with ultrasound and maintaining, based on condition, has been shown to extend equipment life by up to twice the life when compared to time interval routines. The money saved on equipment failure and fewer production failures can more than offset the cost of an effective Ultrasonic test equipment kit and effective maintenance program.

Software designed to work with ultrasonic test equipment provides baseline comparisons that technicians can use to determine the need for maintenance and provide reports that track testing and maintenance if performed. Because ultrasonic testing detects problems before heat, scheduling maintenance is more flexible due to the increased time between knowing a problem exists and having to repair it.

These maintenance routines have proven to save significant amounts of money normally allocated to reactionary routines and unnecessary downtime. Owners, managers, maintenance supervisors and quality managers should all have a serious look at implementing ultrasonic testing into their operations to save money, reduce losses and increase reliability.

One of the other many uses of Ultrasound testing is detecting pneumatic leaks. Most pneumatic leaks go undetected as they occur in loud environments, masking their sound. Ultrasonic testing provides the ability to pinpoint the leaks with equipment still in operation, allowing for a much more flexible inspection schedule.

The plant doesn’t need to be shut down to conduct inspections. Ultrasonic inspections of pneumatic systems have historically realized a cost savings on system energy required of up to 30 per cent. Couple that savings with the reduced requirement for the equipment to run and the consequent maintenance savings allows for some terrific gains in efficiency.

Electrical system testing is yet another area where ultrasonic testing can be utilized to realize savings and create a safer work environment. When it comes to electrical systems, most failures are due to installation problems, water damage, insulation issues and poor workmanship.

Electrical failures pose a tremendous

safety threat and have the ability to shut down operations entirely.

Electrical discharge is a constant threat to safety — and the health of electrical systems. Ultrasonic testing reveals electrical fault conditions such as partial discharge (corona), partial arcing (tracking) and arcing discharge inside metal clad switchgear, around substations, and in overhead transmission and distribution lines. Use ultrasound to hear what cannot be seen.

One of the most potentially dangerous and inefficient systems we use today is steam systems. Steam traps contribute to product quality, energy conservation, component longevity and employee safety.

Yet it is not uncommon to have as much as 50 per cent of steam traps in a failed state. As hot steam travels from the boiler to the point of use, some cooling is inevitable. The result is condensate and gases.

The job of the steam trap is to isolate and remove these impurities from the live steam. Steam traps that function properly help maintain purity and efficiency throughout the system.

The best way to test steam trap function is to listen to them with an ultrasound solution. Ultrasonic detection provides the ability to hear: The opening and closing of the steam trap; silence if the steam trap is stuck in the closed position; turbulent flow if the steam trap is stuck in the open position; and mechanical clattering if the steam trap’s valve is fluttering open and shut. Any valve that has flow through it of air, steam or fluid can have defects and inefficiencies. Ultrasonic testing can save time and money by hearing things that can’t be seen without having to tear down systems for inspection. How can you be sure? When a valve isn’t completely closed, it creates ultrasonic turbulence at the source of the leak. Ultrasound hears that turbulence over the noise of the factory.

Whether it’s internal or external leaks, or issues with flow regulation, valve leaks are a threat to productivity. Regular ultrasonic inspection quickly identifies which valves are leaking and which ones are closed.

Regardless of the specific industry or region of the world, ultrasonic testing systems are growing all the time to assist in preventative maintenance routines and help create more efficient and safer workplaces.

May 2017 — BC Shipping News — 41

MARINE SAFETY

Continuously improving marine safety, starting with the right set of data Sonia Simard, Director of Legislative and Environmental Affairs Shipping Federation of Canada Having high quality, timely and accessible data on maritime transportation in Canadian waters is important to ensure that investments in trade corridors will strategically support Canada’s economic growth.

I

n the 2017 budget, the federal government proposed to invest $50 million over 11 years to launch a Trade and Transportation Information System. We welcome this announcement and eagerly await details, including information on the scope of data that will be compiled under this proposed centralized information system.

Having high quality, timely and accessible data on maritime transportation in Canadian waters is important to ensure that investments in trade corridors will strategically support Canada’s economic growth. Well done, but we should not stop there.

Equally important is having up-todate and comprehensive data on maritime transportation to enable meaningful public policy decisions when it comes to continuously improving marine safety.

42 — BC Shipping News — May 2017

We stress the word “CONTINOUSLY” as we are not starting from scratch. There is a history of safe shipping in Canadian waters, and the foreign flag vessels that transport Canada’s imports and exports are governed by a strong regulatory and safety framework. Indeed, the Canadian government, and Transport Canada in particular, is an important actor when it comes to enforcing safety regulations in Canadian waters, as part of its responsibilities as a Port and Coastal State.

This being said, any activity comes with a level of risk and maritime transportation is no exception. Our industry has a responsibility to recognize that more can always be done to further reduce risks linked to marine transportation. This is where both the federal government and the maritime industry need to start from the right set of data.

Although several entities are currently compiling information on various aspects of marine safety and pollution incidents and accidents — including the Canadian Ship-source Oil Pollution Fund, the Transportation Safety Board of Canada and, to some extent, the Canadian Coast Guard — those databases are limited in terms of scope, content, public accessibility and the centralization of information. In the last five years or so, reports from various sources, such as the Commissioner of the Environment and Sustainable Development, the Tanker Safety Expert Panel, and the Clear Seas Centre for Responsible Marine Shipping have identified some of the shortfalls affecting current data.

Having a comprehensive, consistent and accessible set of data on various aspects of marine safety and pollution incidents and accidents is essential for several reasons, chief among which is the need to accurately assess risks, develop lessons learned from previous incidents, and ensure that improvement or mitigation measures are based on facts. Working with an accurate and comprehensive set of data is also important in a context where this government will be looking at prioritizing its actions to implement the multi-facetted Ocean Protection Plan over the next five years, on a national basis — from coast to coast to coast.

Starting with the right set of data is a first step towards building common and well-informed views on the level and management of risks, which is essential when it comes to deciding which measures to implement to continuously improve marine safety.

LEGAL AFFAIRS

The duty to honour: Gitxaala Nation v. Canada

By Megan Nicholls Maritime Lawyer, Bernard LLP, Vancouver

“

U ltimately, it is through negotiated settlements, with good faith and give and take on all sides, reinforced by the judgements of this Court, that we will achieve […] a basic purpose of s. 35(1) – ‘the reconciliation of the pre-existence of aboriginal societies with the sovereignty of the Crown.’ Let us face it, we are all here to stay.”

Supreme Court of Canada Chief Justice Antonio Lamer’s words in the 1997 case of Delgamuuk v. British Columbia elicit the principles central to Aboriginal rights law. Section 35(1) of our Constitution provides that “the existing aboriginal and treaty rights of the aboriginal people in Canada are hereby recognized and affirmed.” Our courts have held that the fundamental objective of aboriginal rights law is the reconciliation of aboriginal and non-aboriginal peoples and their respective claims, interests and ambitions.

Infrastructure projects and industrial activities often affect Aboriginal groups whose rights must be protected in accordance with the Constitution.

When the Crown contemplates conduct that might adversely impact potential or established Aboriginal or Treaty rights, it has a duty to consult and, where appropriate, accommodate these rights. This duty stems from the Crown’s unique relationship with Aboriginal peoples and forms part of the process of reconciliation. How these principles translate to practice has been the subject of much debate and litigation.

The Federal Court of Appeal recently applied these concepts in Gitxaala Nation v. Canada, 2016 FCA 187, leave to appeal ref ’d, which concerned the Northern Gateway Pipeline (NGP) project. The Federal Court of Appeal determined that Canada failed to meet its obligation to adequately consult First Nations affected by the NGP project. Practically speaking, this halted the project’s progress while the Governor in Counsel (GIC)

When the Crown contemplates conduct that might adversely impact potential or established Aboriginal or Treaty rights, it has a duty to consult and, where appropriate, accommodate these rights. was ordered to reconsider the matter in light of the court’s judgement. Gitxaala highlights the importance of Aboriginal consultation in infrastructure projects.

On November 29, 2016, the Canadian government announced that the NGP will not be proceeding. As such, the GIC will no longer be tasked with reconsidering the project. However, parties dealing with Aboriginal consultation in future infrastructure projects will undoubtedly look to the court’s reasoning in Gitxaala Nation for guidance, including on the Trans Mountain Pipeline project.

The duty to consult

The legal principles pertinent to the scope and content of the duty to consult can be summarized as follows: 1. The duty arises when the Crown has actual or constructive knowledge of the potential existence of Aboriginal rights or title and contemplates conduct that might adversely affect those rights or title.

2. Good faith is required on both sides in the consultative process. The Crown must intend to substantially address Aboriginal concerns as they are raised.

At the same time, Aboriginal claimants must not frustrate the Crown’s reasonable good faith attempts, nor should they take unreasonable positions to thwart the government from making decisions or acting in cases where, despite meaningful consultation, agreement is not reached.

3. Canada is not held to a standard of perfection in fulfilling its duty to consult; rather, it must make every reasonable effort to inform and consult.

4. The controlling question in all situations is what is required to maintain the honour of the Crown and to effect reconciliation between the Crown and the Aboriginal peoples with respect to the interests at stake.

5. Meaningful consultation is not just a process of exchanging information.

Instead, it entails ‘testing and being prepared to amend policy proposals in the light of information received, and providing feedback.’

6. Adequacy of consultation is determined having regard to the importance of the Aboriginal right at issue and to the magnitude or the potentially adverse impacts of what is being proposed on the First Nation right or privilege.

7. Where the Crown knows, or ought to know, that its conduct may adversely affect the Aboriginal right or title of more than one First Nation, each First Nation is entitled to consultation based upon the unique facts and circumstances pertinent to it.

8. Consultation after the fact does not satisfy the duty; it must occur prior to exploration activities taking place on a staked claim.

9. The duty to consult and accommodate does not afford First Nations a “veto” over the proposed activity. In Prophet River First Nation v. Canada (Attorney General), 2017 BCCA 58, the court recently admonished the Treaty 8 Tribal Association for taking the approach that the only acceptable compromise was to abandon the entire project.

Put simply, a meaningful process of reconciliation requires working collabMay 2017 — BC Shipping News — 43

LEGAL AFFAIRS While the Crown’s duty to consult cannot be delegated, the Crown may involve the project’s proponent in the procedural aspects of this process. oratively to find a compromise that balances the conflicting interests at issue, in a manner that minimally impairs the exercise of Aboriginal rights.

While the Crown’s duty to consult cannot be delegated, the Crown may involve the project’s proponent in the procedural aspects of this process. The proponent’s role can include providing information about the project to First Nations groups; obtaining and discussing information about specific Aboriginal interests; considering modifications to mitigate impacts; and documenting these efforts.

The NGP project and the courts

The NGP project was designed to transport oil from Alberta to B.C. for loading onto tankers for export; and to transport condensate from tankers in B.C. to Alberta for distribution to Alberta markets. Portions of the oil and tanker routes for the NGP are located within several First Nations’ asserted traditional territory. While about 60 per cent of the Aboriginal communities along the NGP’s route supported the NGP, the applicants in Gitxaala Nation were among the dissenting communities’ members.

The legislative framework at issue concerned the Canadian Environmental Assessment Act and the National Energy Board Act. At the conclusion of a formal approval process under that legislation, the Review Panel ultimately found that the project was in the public interest, recommending that approval Certificates be issued subject to 209 conditions requiring plans, studies and assessments to be considered and assessed by the Board. The Panel recommended that the GIC conclude that the adverse environmental effects from the project would not be significant, and that significant adverse effects that certain caribou and bear populations would experience were justified. The GIC accepted the Panel’s findings and issued the Certificates, noting that the project would diversify Canada’s energy export markets and would contribute to Canada’s long-term economic prosperity. A number of judicial reviews and appeals ensued and were 44 — BC Shipping News — May 2017

consolidated before the court in this case.

One of several issues raised was Canada’s conduct in the consultation process. Canada submitted that during the consultation process it provided almost $4 million in participant funding to 46 Aboriginal groups. However, the applicants pointed out several flaws in the consultation process. For example, the applicants asked for a delay of the decision to allow for the proper scientific studies to take place and to obtain spill modelling, which would have provided a better understanding about how environmental conditions would influence a spill. Canada promised to request this, but no response was ever provided to the First Nations.

The court agreed that Canada “fell well short of the mark” of meeting the duty to consult. Canada failed to consider and discuss a number of Aboriginal groups’ concerns which were central to their legitimate interests, including the impact of the proposed shipping routes and potential oil spills in their territories.” Missing from the process was a real and sustained effort to pursue meaningful, two-way dialogue; “someone from Canada’s side empowered to do more than take notes, someone able to respond meaningfully at some point.”

What is a proponent to do?

In Gitxaala, the court noted the consultation efforts of NGP’s proponent, who engaged with over 80 Aboriginal groups across various regions of Alberta and B.C. It employed many methods of engagement, giving $10.8 million in capacity funding to interested Aboriginal groups. It also implemented an Aboriginal Traditional Knowledge program, spending $5 million to fund studies in that area. The proponents’ consultation conduct was not at issue in the litigation.

In light of the proponents’ efforts and investment in this project, one can only imagine its frustration with the results arising from Canada’s conduct.

This raises the question of what proponents can do to mitigate their risks of Canada’s potential failure to consult.

One proponent took action by suing the Ontario government for breach of its duty to consult in Northern Superior Resources Inc. v. Ontario, 2016 ONSC 3161. In that case, the court considered whether the government owed a duty of care to the proponent in the circumstances. The test for duty of care asks firstly whether there is a sufficient relationship of proximity between the parties, and if so, whether there is some reason why the duty of care should be limited or extinguished. The court found that there was not sufficient proximity. As to the second part of the test, it said: In the context of modern-day Canada, with the constitutional recognition of the rights of First Nations and our, generally, understood desire for reconciliation, there could be no more powerful policy recognition calling for the setting aside of any duty of care owed by the Crown to third parties than our expressed desire to come to terms with our history and our relations with those who were here first.

Northern Superior involves an unusual set of facts and is unlikely to be the last word on these issues. Indeed, that case highlights many important questions remaining. What standard of conduct, if any, is owed by the Crown to proponents in other circumstances? If the Crown does owe proponents a duty in some circumstances, does negating that duty in the name of reconciliation really advance our society towards the ultimate goal? Can the Crown adequately comply with its fiduciary duties to First Nations peoples, while at the same time balancing the interests of all Canadians? What happens when there is an imbalance to the unjustifiable detriment of industry, other interest groups, or the whole of Canadian society? These are questions which are likely to be raised in future cases.

Conclusion

The FCA’s judgement in Gitxaala underscores the importance of all participants thoughtfully exchanging, engaging with, and responding to ideas presented throughout the consultation process; without it, infrastructure projects will not proceed. This process requires a commitment by all participants, and indeed all Canadians, to learn about and honour each other’s perspectives.

Megan Nicholls is a Maritime Lawyer with Bernard LLP. She can be reached at nicholls@bernardllp.ca.

NAVAL ARCHITECTS

Capilano Maritime Design Ltd. turns 10

A commute’s inspiration

Mark Mulligan, Partner and Senior Naval Architect for Capilano Maritime, remembers well the “inspiration” that brought about the creation of the company — as well as its name. In 2007, both Mark and Chris were employees of a well‐known Vancouver tugboat designer and had a rather long and congested commute from Capilano Road in North Vancouver where both gentlemen resided.

While stuck in traffic on the Lions Gate Bridge one evening, the thought arose of having their own business that would eliminate the long commute — and what better name to call it than “Capilano.”

Although their work was rewarding in a lot of ways, Mark and Chris realized that there was a growing demand locally for tugs, barges, workboats and small ferries, as the older generations of these vessels were due to be retired.

Work barges

Although thoughts of home‐based offices were at first envisioned by both men, their wives were adamant that this was not going to happen. The alternative was renting a small furnished office in North Vancouver that quickly proved

Photo courtesy Ledcor

O

ne of the youngest of Vancouver’s naval architecture and marine engineering firms is Capilano Maritime Design Ltd., which is celebrating its 10th anniversary this year.

Established in 2007 by local naval architects Chris Mulder, P. Eng. and Mark Mulligan, P. Eng., FEC, the company has specialized in commercial working vessels such as tugs and barges as well as conventionally‐powered and cable‐powered ferries. In recent years, it has also diversified into inland work, including the design of shallow draft ferries for river and lake usage as well as a number of specialized craft, including dredges, work barges and tugs, for employment in the Alberta Oil Sands development. Currently in progress are projects involving an auxiliary landing craft for Antarctic service, an oil spill recovery barge for East Coast deployment, a large bucket wheel dredger for Saudi Arabia and a number of cable ferries for river and lake crossings in British Columbia’s interior and the Prairie Provinces.

Working with small, but specialized Chinese shipyards, Capilano Maritime helped secure a number of contracts for barges.

While stuck in traffic on the Lions Gate Bridge one evening, the thought arose of having their own business that would eliminate the long commute — and what better name to call it than “Capilano.” inadequate as barge orders streamed in following an inaugural contract with Seaspan calling for the design of four 80‐metre‐long units to be built in China.

The success of this venture, and a close working relationship established with several small, but specialized Chinese shipyards, brought about more barge work. Eventually, and in collaboration with Vancouver’s well-known Seabridge Marine Contractors, over 20 barges of several different lengths and configurations were designed and built for both West Coast and East Coast deployment.

These included the company’s 73 to 110‐ metre Skeena Class and 34 to 75‐metre Hebron Class deck barges, Squamish Class chip barges featuring high bin walls, as well as the 55‐metre Seymour Class split‐hopper barges used for disposal work

by Vancouver Pile Driving Ltd.

First ferries

In 2009, a diversification into ferry boats was made when Capilano Maritime partnered with Alaska Ship and Drydock

(today Vigor Alaska) to design a new 23‐ car ferry to serve the Ketchikan Airport in southern Alaska. Collaborating with the builder, Capilano furnished the contract design package for the 35.5 by 14.6‐metre vessel as well as full CAD production model and drawings along with technical assistance. Experience gained in this project led to two further ferry contracts, one involving a 27.6 by 9.9‐metre open deck cable ferry for the Marine Division of Manitoba Infrastructure and Transportation, which will enter service later this year near Norway House, Manitoba, and a multiple cable ferry contract for Waterbridge Steel Inc. of British Columbia for inland lake and river service. The latter vessels, for which Capilano is providing functional and production design services as well as quality management, will consist of two nine‐vehicle and two 24‐vehicle vessels to be built by Waterbridge Steel in Nakusp, B.C. for service on Upper Arrow Lake, Adams Lake, Kootenay Lake and the Kootenay River.

May 2017 — BC Shipping News — 45

NAVAL ARCHITECTS delivered in 2015 by Ocean Industries in Quebec City, Quebec, and two 10.5‐ metre workboats designed for Canadian Natural Resources and built in 2015

by Hike Metal Products in Wheatley, Ontario.

Photo: Kurt Redd

Design Innovation

Photo: Vlad Prado

The Sommer S is a good example of Capilano Maritime’s Columbia Class tug.

Capilano Maritime partnered with Alaska Ship and Drydock to design a new 23-car ferry to serve the Ketchikan Airport in southern Alaska.

Powerful tugboats

In 2010, a major project for the company in the tugboat sector opened when Portland, Oregon‐based Shaver Transportation requested design work for a new ship‐assist vessel to be used on the Columbia River where several new terminals were being planned. A compact powerful tug was required with a high degree of f lexibility. The result was a 24.4 by 11‐metre boat completed by Portland’s Diversified Marine in 2012 that incorporated a propulsion system consisting of two MTU/diesel engines driving through twin Schottel azimuthing thrusters to give a bollard pull of 60.8 metric tonnes. Christened Sommer S, the vessel was delivered in mid‐2012 and has since been working steadily on the Columbia and Willamette Rivers.

46 — BC Shipping News — May 2017

Known as Capilano’s Columbia Class, the tug design can be built in several sizes from 24 to 32 metres and with 60 to 90 tonnes of bollard depending upon machinery selection. It has since been followed by the smaller Capilano Class, from 12 to 28 metres in length with an installed power range of 1200 to 2800 BHP, and the larger Kitimat Class escort tug that can be used for long distance service escorting oil and LNG tankers. This latter vessel can be powered by dual-fuel engines giving a bollard pull of 110 tonnes and a free running speed of 14 knots. At the other end of the company’s portfolio are a series of smaller shallow draft tugboats and workboats designed for inland use, including a 13.5‐metre tug designed for Manitoba Hydro that was

Capilano Maritime has been introducing its designs to solve problems it sees arising in the industry. In 2014, Capilano designers noticed a need for safer tugboats for shallow water work, particularly after the loss of several older vessels of this Class. To give operators an idea of what was possible, a replacement design was drawn up that, although conventional in both appearance and propulsion, features increases in freeboard and beam to give greater stability as well as wider side decks for ease of movement and more room in the accommodation and machinery spaces.

The 15 by 6.2-metre vessel also incorporates a f lush decked hull, with twin chines, and a long “shark fin” skeg to give directional stability. Four transverse watertight bulkheads divide the hull into compartments while fendering is provided all around, with concentrations at the bows and stern for barge pushing and log sorting, an innovative configuration that combines significant safety features with a strong hull having a high degree of manoeuvrability.

Services Offered

Today, after several relocations as business has continued to grow, Capilano Maritime is located at 110 ‐ 18 Gostick Place in North Vancouver, and its work force now numbers 14. Five of its 10 technical staff are Professional Engineers, while another five are Engineers in Training. This has allowed the company’s scope of work to steadily expand from design and architectural services, to stability assessment and analysis, survey and inspection, engineering and procurement support, marine accident investigation, marine heavy‐lift operations and general marine consulting, making up a well‐ rounded firm with very strong design and analytical capabilities.

All in all, even though the little company was started in the 2007‐08 economic depression, Chris and Mark are well satisfied with the development and direction of Capilano Maritime Design Ltd.

ENVIRONMENT

GreenTech 2017: First conference in the American South for Green Marine

By Julie Gedeon

G

reen Marine has a stellar lineup for its 10th annual conference this May 30 to June 1 in Fort Lauderdale, Florida. The conference’s first foray into the American South is also expected to attract a dynamic mix of familiar and new faces to GreenTech 2017.

“All of our regulars — some in attendance from the very first GreenTech conference — will be there to celebrate Green Marine’s 10th anniversary,” explains Manon Lanthier, Green Marine’s Communications Manager.

“Plus, there will be many new delegates representing members who have recently joined the environmental program.”

Program Manager Véronique Nolet, who organized this year’s content with

the help of a program committee, is pleased with the agenda. “We took advantage of being in the American South for the first time to call upon regional experts to address topics of interest to the overall membership,” Nolet says. “So, for example, we’ll gain some keen insights regarding storm readiness from port authorities that have to deal with tropical storms and, occasionally, hurricanes.”

The proximity to Port Everglades — ranked among the world’s top three cruise ports — prompted organizing an entire session on the cruise industry’s environmental challenges for the first time at the conference. The panel discussion will include representatives

from the Carnival Corporation, Royal Caribbean International, and the Cruise Lines International Association. Ginger Garte, Lloyd’s Register Americas Environmental and Sustainability Director, brings substantial experience from working in the cruise industry to her role as the panel’s moderator.

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Learn about hybrid and electric solutions for workboats.

May 2017 — BC Shipping News — 47

GREENTECH 2017 Two plenary sessions are planned. The first will focus on leadership and sustainability. “Representatives from Maersk Line, RightShip and the Port of Antwerp will no doubt give delegates a broad perspective on this particular theme,” Nolet says. “We’re also opening up the discussion as to whether there’s enough synergy between ship owners and port authorities.”

Dual fuel and LNG will be discussed in the second plenary session. “Upcoming regulations to curb air emissions and major technological advances are prompting broader interest in both of these,” Nolet notes.

As always, several parallel sessions will take place to provide ample opportunity to address issues of specific interest to ship owners/operators or ports/terminals respectively. “These triedand-true sessions permit us to go into a greater depth that we’ve repeatedly been told is appreciated by participants,” Lanthier says.

Ship owners and port managers will have to the chance to learn more about how to implement the program’s new environmental performance criteria to minimize underwater noise and its impacts, as well as ways to green their infrastructure to better protect marine ecosystems.

GreenTech 2017 is being held at the Hyatt Regency Pier Sixty-Six, a hotel with resort-style amenities on 22 acres (8.9 hectares) of mature palm-treed landscaping and a world-class marina. The conference and exhibition will be take place within the divisible main Crystal Ballroom.

The welcoming reception, along with coffee and lunch breaks, will afford time for delegates to visit with the 18 booths occupied by maritime innovation experts. They book space at GreenTech knowing the conference’s delegates are actively seeking cuttingedge solutions to improve their company’s sustainability.

Networking is always a key component of every conference, along with the opportunity (whenever possible) to become more familiar with the port area in the GreenTech vicinity.

Green Marine and Port Everglades have arranged for delegates to explore the Greater Fort Lauderdale area from the water aboard one of the city’s signature Water Taxis. This exclusive tour will take place Thursday, June 1, from 4 to 6 p.m.

“Thursdays are typically busy cargo days for Port Everglades, so we’re likely to encounter post-Panamax container ships, petroleum tankers and possibly a yacht transport,” shares Peg Buchan, Assistant Port Director at Port Everglades. “Along the way, we’ll also see a variety of yachts, multimillion-dollar mansions, and South Florida’s unique flora and fauna.”

There are so many reasons to attend GreenTech 2017 that not all of them could be listed here! If you haven’t already registered, please do so asap. More information is available at www. green-marine.org/greentech/

Giving seafarers a helping hand for over 160 years!

Get on Board with Us www.flyingangel.ca 48 — BC Shipping News — May 2017

Photo courtesy Port Everglades

GreenTech 2017 attendees will be able to take a tour of Port Everglades, a busy cargo and cruise port.

TUGS & BARGES

ITB Marine new tugs on the way

By Alan Haig-Brown Photo: Dave Roels (www.daveroels.com)

V

ancouver-based ITB Marine has a reputation for excellence in their vessels and equipment.

Over the years they have refurbished and repowered older vessels and completed new vessels. They are currently working on their most ambitious and innovative project to date. In their Annacis Island Shipyard, located under cover in a pair of huge leased warehouses on the Fraser River, they are building two tugs that will be paired with two of their existing barges. The two boats are built with pins for use in an articulated tug and barge application. The tugs will be put into service on B.C.’s West Coast.

Two existing barges will be modified with the addition of pin ladders and stern extensions for connecting to the new tugs.

The Vancouver-based naval architect firm of Robert Allan Ltd. did the design work for the tugs and the barge modifications, making extensive use of Computational Fluid Dynamics programming.

The hull of the first of two new Robert Allan Ltd.-designed tugs for ITB Marine.

Working with this entirely new design, ITB engaged Bracewell Marine Group last April to supply the tradespeople and supervision of the project. Chris (need last name/title), reported that his crew of 38 have made good progress in moving

toward completion, with hull fitting and assembly of the wheelhouse and galley as the next tasks scheduled.

As they had the steel cut for the first boat, they had the second set cut at the same time and that, with some assembly,

May 2017 — BC Shipping News — 49

Photo: Dave Roels (www.daveroels.com)

TUGS & BARGES

“All of the welds have been inspected without a single failure,” said ITB Marine Group’s Marinus Goossen.

50 — BC Shipping News — May 2017

is also in the warehouse along with complete sets of Z-drives, deck cranes and other equipment. “Construction time for the second tug will be shorter than the first,” said Chris. “We’ll be laying the keel soon and expect it will take less than a year to complete construction.”

The 24.9 by 12.5-metre hull of the first tug dominates one of the warehouses. At the lowest point on the amidships deck, the hull has a molded depth of 3.65 metres. A poop deck aft has flush removal hatches above the two Rolls Royce US105-P9 Z-drives. Forward, a raised forecastle deck contains the port and starboard coupling pins manufactured by the Japanese firm Taisei Engineering Consultants, Inc., under the name Articouple.

The main deck house, built, like the hull, in steel, continues aft from the forecastle and will contain accommodations.

This includes separate captain and mate cabins with heads, two single bunk crew cabins with shared head and two double bunk crew cabins with shared head. A companion way separates the accommodation area from a fiddly over the engine room that is located below in the hull. The clear deck over the fiddly has removable pads for ease in swapping out engines; it will also support a crane and rescue boat.

The engines, set well aft, are a pair of V-12, IMO Tier II certified, Cummins K38-M diesels, each generating 850 HP (634 kW) continuous at 1800 RPM. The carbon fibre shafts pass through a bulkhead to the port and starboard Z-drive rooms. The Rolls Royce drives, which in March were stored in an adjacent warehouse, have 1,600 m/m propellers in

TUGS & BARGES tank barge routes between Vancouver, Vancouver Island and Puget Sound ports, all of which are in relatively sheltered waters. nozzles. Forward of the engine room, a workshop and tankage makes good use of the ample space. Forward of that, an electric over hydraulic pump for the coupling pins is located just below the main deck pin rooms.

Also in the adjacent warehouse, the aluminum B-deck is taking shape. It will include a wet room, large mess/lounge area and a well laid out galley. Stairs will lead up to a smaller cabin area for the HVAC and wheelhouse electronics. Above that is a large wheelhouse, with full walk around outer deck.

It will provide the helmsman with a 12.3-metre height of eye.

The aluminum deckhouse and the wheelhouse tower are being fabricated separately for assembly once moved out of the building sheds.

The boats, dedicated ATB vessels with no towing capability, are designed for their owner’s tank barge routes between Vancouver, Vancouver Island and Puget Sound ports, all of which are in relatively sheltered waters.

ITB Marine Group Chief Fleet Engineer (New Builds) Marinus Goossen expects to have the first boat in the water this coming summer, with another month of work alongside

Photo: Dave Roels (www.daveroels.com)

The boats ... are designed for their owner’s

Marinus Goossen, ITB Marine Group’s Chief Fleet Engineer (New Builds).

prior to sea trials. The second vessel will be ready to join ITB’s fleet in late spring of 2018.

When a visitor recently commented on the quality of the welding on the steel hull, Goossen, replied with pride, “We are building these boats to Lloyd’s class. All of the welds have been inspected without a single failure.” In that comment he reflects the pride of the tugs’ owners, designers and all the crafts people who are doing the actual building.

Innovation Design Engineering Analysis Safety

ATB Pusher Tug N AVA L A R C H I T E C T S A N D M A R I N E E N G I N E E R S

www.ral.ca

25 m, 1700 HP, twin Z-drive Island Regent for ITB Marine Group

May 2017 — BC Shipping News — 51

POLAR CODE

ABS delivers first Polar Code Operational Assessment John Dolny, Senior Engineer, ABS, Harsh Environment Technology Centre The IMO’s Polar Code ... requires owners and operators of all ships seeking to transit ‘polar’ waters (above the 60th parallel) to conduct an operational assessment before sailing in the Arctic and Antarctic.

N

ew global regulations, emerging commercial interest and a renewal of the ice-breaking fleet are driving a rise in requests for technical support to manage the risks of polar shipping.

ABS, a leading provider of classification and technical services to the marine and offshore industries, last month delivered North America’s first Polar Code Operational Assessment, supporting the polar-readiness of a cable-laying vessel owned by a U.S.-based organization.

The IMO’s International Code for Ships Operating in Polar Waters, or the ‘Polar Code’, is a global regulation that entered into force in January. It requires owners and operators of all ships seeking to transit ‘polar’ waters (above the 60th parallel in the northern hemisphere) to conduct an operational assessment before sailing in the Arctic and Antarctic.

52 — BC Shipping News — May 2017

Commercial ships operating in Arctic waters — whether they are support ships such as cable layers, standard bulk carriers and tankers, or cruise ships — are exposed to additional hazards above and beyond traditional open-water routes, the most apparent is the requirement to navigate sea ice in the shipping lanes.

Operators can also face operational hazards associated with the extreme lows in ambient air temperatures, which can affect the performance of equipment and personnel, and accelerate the erosion of materials.

Ice accretion, which can affect the stability of smaller ships, is another potential hazard faced by crews that has the potential to impact the functionality of exposed equipment and make areas of the ship treacherous.

The Polar Code is a risk-based regulation, meaning it requires owner/operators to select controls that are appropriate to

the variable threats to be faced by the specific ship (including its equipment) and its intended operations in a specific area, a set of criteria known as the ship’s ‘operational profile.’

The profile establishes the potential hazards for the specific operation.

Because the Arctic is a dynamic environment, which changes seasonally and geographically, setting the operational parameters and associated hazards is the key to establishing the applicability of each of the Code’s regulations.

The assessment will also set any limitations to be listed on the Polar Ship Certificate, a list of procedures for the Polar Water Operational Manual, and any risk-control measures for the ship’s systems and equipment, including lifesaving appliances and survival resources in areas where rescue options can be limited.

It also establishes a structure for how a company intends to manage its survival resources — one of the more challenging components of complying with the Code — and ultimately supports a smoother process towards certification.

The Polar Code does not require the operational assessment to be conducted by an independent third party. However, there are advantages to enlisting the services of external experts, not least of which is the confidence that an ‘arm’s length’ assessment builds with the operator’s stakeholder community.

After establishing the operational profile, environmental data needs to be reviewed to project seasonal ice and weather trends for the intended areas and periods of operation. These data sets are, for the most part, publicly available.

However, ABS has invested substantial resources into the analysis of the data to establish rich veins of information with regards to trends in areas such as sea ice age and concentrations, the potential for ice accretion and low air temperatures specific to relatively finite areas.

Through this analysis it is possible to gain a deeper understanding of a vessel’s operating risks and to prepare for them using a structured assessment.

SHIPWRECKS

Last port of call of the S.S. State of California: Gambier Bay, Alaska

By David Leverton, Executive Director, Maritime Museum of British Columbia

F

Near the outer entrance to Gambier Bay is the final resting place of the S.S. State of California where the large ship sank on August 17, 1913. The 306-foot-long, ironhulled steamship was built in Philadelphia in 1879. She was the largest vessel during that time period to cruise the Lynn Canal and the Inside Passage of Alaska. The ship was owned by the Pacific Coast Steamship Company and was under the command of Captain Thomas H. Cann, Jr. The ship was on a voyage from Seattle to Skagway that included several port stops including Vancouver, B.C. The vessel left Puget Sound on August 13, 1913.

Gambier Bay was the site of a new cannery run by the Admiralty Trading Company and was a regular port of call.

On the morning of August 17, 1913, the S.S. State of California had just left the cannery dock and had increased speed to over 12 knots when she struck an uncharted rocky pinnacle. The ship quickly took on water and began to severely list to the port side causing the starboard lifeboats to swing inboard making them inaccessible to the crew and their passengers.

While efforts were made to head to a nearby beach that was 500 feet away, the

Image source: Google Earth

or many years, my wife and I would spend part of our summer gunkholing around the panhandle of Southeast Alaska. One of our favorite spots is Gambier Bay, which is located approximately 72 nautical miles south of Juneau, Alaska, on the southeast side of Admiralty Island at the southern end of Stephens Passage. It is a quiet and tranquil location during the summer months where sea life abounds and humpback whales may be seen at the entrance to the bay.

We were very careful to follow our navigational charts and depth sounder to avoid the many underwater reefs that are located near the inner entrance of this secluded spot. It is hard to imagine a time when large passenger ships used to ply these waters totally reliant on their ship’s compass and coastal navigation charts of the period, without the support of any electronic aids such as depth sounders, GPS or radar which are all commonplace today. At nighttime, the Officer on the Bridge would sound the ship’s whistle and count the seconds until they heard the back echo to help determine their approximate location.

Aerial of Gambier Bay in Southeast Alaska at the southern end of Stephens Passage. This image is from Google Earth, with the red marker indicating roughly the site of the S.S. State of California shipwreck.

ship fell short of its goal and sank down a steep rocky incline with the stern of the vessel submerged in approximately 210 feet of water and the top of the bow remaining 70 feet below the surface.

The ship sank in approximately three minutes.

A total of 74 passengers and 72 crewmembers were onboard at the time and 31 individuals tragically lost their lives in the disaster. The ship struck the rocky pinnacle at an extreme low tide. The draft of the S.S. State of California was 18 feet 6 inches and the rocky reef was estimated to be 125 feet long and 60 feet wide and covered by less than 16 feet of water at the moment of impact. According to the Local Inspector’s Report of the event, the navigation chart showed a depth of 12 1/2 fathoms. Due to the charting error, the Captain and Officers aboard the S.S. State of California were absolved of any wrongdoing or dereliction of duty in two separate inquiries held in Juneau and Seattle.

A little over five years from the date of this disastrous maritime event, the S.S. Princess Sophia would strike Vanderbilt Reef in the Lynn Canal in the early morning hours of October 24, 1918. The S.S. Princess Sophia also relied on the navigational aids of the day that did not include GPS, radar or the use of any kind of sonar echo sounding device. All of the passengers onboard the S.S. Princess Sophia perished in the largest maritime disaster in the Pacific Northwest. The Maritime Museum of British Columbia, in collaboration with other museums, are planning on commemorating the 100th anniversary of the sinking of the S.S. Princess Sophia. Anyone interested in learning more about the planned exhibition or contributing to the project please visit: www.mmbc.bc.ca.

The Maritime Museum of British Columbia is located at 634 Humboldt Street, Victoria, British Columbia. For further information please contact David Leverton, Executive Director at 250 385-4222 ext. 101 or by email: dleverton@mmbc.bc.ca.

May 2017 — BC Shipping News — 53

ADVERTISERS

Photo: Dave Roels

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