BC Shipping News - October 2015

INSIDE: VANCOUVER INTERNATIONAL MARITIME CENTRE

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

Volume 5 Issue 8

www.bcshippingnews.com

NEWS October 2015

Industry Insight

Vital links Serge Buy, Canadian Ferry Operators Association & Len Roueche, Interferry

Ferries

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Contents

NEWS

Cover Story

20 7 8 12

Editor’s note

By Jane McIvor

In brief

Industry traffic and news briefs

Industry insight

Vital links Serge Buy, Canadian Ferry Operators Association and Len Roueche, Interferry From safety issues to operational improvements to technological advances and best practices, both representatives of the ferry industry are well-versed on the relevant issues that impact their members.

12

18

October 2015 Volume 5 Issue 8

38

International shipping

41

International shipping

44

Legal affairs

46

Ballast water

History lesson

The rise, fall and return of sail

By Lea Edgar

20 Ferries

Living dangerously on a Filipino ferry

By Jaya Prakash

23 Ferries

Introducing LNG to the BC Ferries fleet

31

Methanol

33

International Maritime Centre

Methanol-fuelled vessels are now a reality

Vancouver — The best location for shipping operations With Kaity Arsoniadis-Stein

35

Class societies

Eastward past the Spratly Islands

By Syd Heal Wreck removal Implementing the International Convention on the Removal of Wrecks, 2007

By David K. Jones Ballast Water Management An update on IMO and U.S. regulations With Michael Michaud

50 Shipyards

Progress update Power plant vessel in the final stages at Meridian Marine

28 Energy

Online tool for ship service energy optimization

By David Stocks

Panama Canal expansion impact may be greater than first thought

By Ray Dykes

52

Spill response

New oil spill rapid response vessel for WCMRC and the West Coast

52

Maximizing growth and profit through LRQA

By Beth Mitchell

On the cover: BC Ferries’ Northern Expedition (foreground) and the Northern Adventure (in the distance) (photo: Lonnie Wishart— www.lonniewishart.com); above: ferries in the Philippines (istock); right: WCMRC’s G.M. Penman (photo: Dave Roels — www.daveroels.com); left: Serge Buy (top) and Len Roueche (bottom).

October 2015 BC Shipping News 5

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October 2015 Volume 5/Issue 8

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6 BC Shipping News October 2015

International Sailor’s Society Canada Vancouver Transportation Club

EDITOR’S NOTE Photos by Dave Roels, www.daveroels.com

I

n this issue of BC Shipping News, we get the opportunity to gain insights about the ferry industry from a larger perspective. We’ve been spoiled here in B.C. We have a ferry system that is safe, efficient and environmentally conscious.

BC Ferries keeps thousands of people employed with well-paying jobs who can be relied upon for their punctuality and professionalism.

And while we’re in good company with many other ferry systems throughout Canada and around the world, after reading Jaya Prakash’ article on the ferry industry in South East Asia, one would struggle to use any of the same adjectives for the sector in this region.

Prakash’ article serves as an eyeopener for an issue that rarely breaks the front page news here in Canada. Given our privileged service, it is hard to imagine standing in a line-up for a ferry that you must take and wondering whether it will get you to your destination in one piece. Such is the lot in life of those in places like Indonesia, the Philippines and Bangladesh. It speaks not only to the risks of ferry travel in Asia but to the necessity of ferries in all parts of the world. One has no choice but to risk their life because there are no other options for travelling across the water.

Taking the issue a step further, Prakash outlines some simple suggestions where the international maritime community can help. From simple encouragement to foster safety principles, to greater collaboration between the International Maritime Organization and local enforcement agencies, there is an opportunity for the world’s ferry sector to assist in avoiding unnecessary loss of life.

Prakash has also come up with the idea of an audible alarm that would warn operators (and ferry passengers) when a vessel becomes overloaded. While we can think of a number of obstacles that would

We’re spoiled here in British Columbia stand in the way of this (lack of funding, a cultural lack of concern for safety, and lack of fear of enforcement to name just a few), the idea in itself demonstrates an effort to solve the problem of safety onboard Asian ferries.

This theme ties in well with the words from Len Roueche, CEO of Interferry in our Industry Insight. Both he and Serge Buy, CEO for the Canadian Ferry Operators Association, speak to the benefits of their annual conferences where operators share knowledge on best practices and learn from speakers who are experts in their fields.

In particular, Roueche notes that the 2016 Interferry Conference will be held in Manila, Philippines. This is a great opportunity to expand the reach of Interferry for the purpose of bringing those principles and the safety culture we take for granted to a part of the world that desperately requires assistance.

The issue is much more complicated than a few simple paragraphs within BC Shipping News can articulate. Having said that however, the international community owes it to the people of Asia to at least try to offer help. I hope we do.

— Jane McIvor

October 2015 BC Shipping News 7

INDUSTRY TRAFFIC

The UBC Sailbot team with Professor Jon Mikkelsen (back, left) at the name unveiling ceremony held at the Vancouver International Airport.

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UBC Sailbot team unveils Ada

M

arking a milestone event, the UBC Sailbot team unveiled the name of their Transatlantic, autonomous sailing vessel. The name — Ada — was chosen to honour Ada Lovelace, often regarded as the first computer programmer. In 1842, her notes on The Analytical Engine were published, making her the first person to describe the potential for computers outside mathematics. The Analytical Engine remained a vision until Lovelace’s notes became one of the critical documents to inspire Alan Turing’s work on the first modern computers in the 1940s.

The team of UBC students — helped along the way by the marine community including Sip and Puff Sailboat inventor Don Martin, and advisors from companies such as Robert Allan Ltd. and Seaspan Shipyards — had planned to enter the Ada into the 2015 Microtransat Challenge, a transatlantic race of fully autonomous sailing boats. However, soon after the unveiling ceremony, the team experienced some delays in the final assembly.

Coupled with bad weather reports in the Atlantic, the decision was made to delay entry into the race until 2016.

“We want to make sure that the vessel is capable of withstanding the weather the Atlantic can have in store for us,” said Team Captain Kristoffer Vik Hansen. “We don’t want to make a subpar product.”

Vik Hansen outlined the plan going forward: “Once the assembly issues have been resolved, the Ada will be tested throughout the winter and spring here in Vancouver to make sure that all systems have undergone proper reliability and foul weather tests. After many months of testing, we expect to be completely ready for launch next summer.

“This plan is a little bittersweet,” continued Vik Hansen. “A number of us on the team graduated in May, and wanted to see this vessel sail over the Atlantic as our end-of-university adventure. We have been pushing this project a lot, working 60 hours a week throughout the summer, in the hopes of taking it to Newfoundland this year to launch. It is sad, but this new plan is better for the project as a whole. It would be terrible if something relatively small and easy to fix went wrong, just because we rushed testing. Especially considering we have spent two years creating this amazing vessel!”

NEWS BRIEFS Horton’s Franklin coin unveiled by Royal Canadian Mint Photo courtesy of John and Mary Horton

M

arine artist John Horton has added yet another distinction to his illustrious career — that of being commissioned to create another collector’s coin for the Royal Canadian Mint, this time in a series to honour ships lost in Canadian waters. Horton’s coin depicts the newly found wreck of HMS Erebus, one of the Franklin Expedition’s lost ships.

“This coin is very special as it was designed in May 2014,” said John, “well before the Victoria Straight Expedition team, including our friend Bill Noon, Captain of the Canadian Coast Guard ship Sir Wilfred Laurier, discovered the wreck of HMS Erebus. “ On September 9, 2014, John and Mary received an email from Captain Noon, just minutes after the announcement by Prime Minister Stephen Harper that a shipwreck from the Franklin Expedition had been found.

“As with all coins I design for the Royal Canadian Mint, I am required to keep it confidential until the coin is unveiled by them,” he said.

The unveiling was held in Halifax in mid-July at the Maritime Museum of the Atlantic.

“Immersing myself in research for the coin inspired me to also create a larger work,” he said, referring to his recently completed “The Franklin Expedition’s HMS Erebus and Terror” (Ed. note: a photo of the painting is on page 19).

Marine artist John Horton stands with the newly released Royal Canadian Mint coin depicting HMS Erebus. In the background is John’s recent work , “The Franklin Expedition’s HMS Erebus and Terror.”

Fortuitously coinciding with the coin’s release, the Vancouver Maritime Museum is displaying “a significant library of Sir John Franklin material,” which was donated by Mr. Anthony Sessions and family. The exhibit, Across the Top of the

World, is running until May 2016. (More information about the VMM exhibit can be found at www.vancouvermaritimemuseum.com For more information about Horton’s painting, please visit www.johnhorton.ca.

The Vancouver Maritime Museum currently has a significant library of Sir John Franklin material on display.

October 2015 BC Shipping News 9

INDUSTRY TRAFFIC

Corvus Energy powers the world’s first electric commercial fishing vessel

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Corvus lithium polymer Energy Storage System (ESS) has been integrated with a Siemens propulsion system aboard the world’s first electric commercial fishing vessel designed and built by Selfa Arctic AS. Corvus Energy recently announced that a Corvus ESS with a Siemens BlueDrive PlusC marine propulsion

system will power the Selfa Elmax 1099 electric fishing boat. The 11-metre electric vessel will have a 195 kWh ESS consisting of 30 Corvus AT6500 lithium polymer battery modules. The fishing boat, designed to operate entirely on Corvus battery power over a planned 10hour working day, will also have a small 50kW auxiliary generator and can be

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Norwegian fishing company Øra AS will operate the first Selfa Elmax 1099 designed by Norwegian shipbuilder Selfa Arctic AS. The electric vessel, to be named “Karoline,” was commissioned in Trondheim Norway in August and presented to the country’s Minister of Fisheries, Elisabeth Aspakerh. The Karoline is currently being tested in the demanding conditions off the coast of Tjeldsundet in Northern Norway.

In September, the boat is to be moved to Tromso Norway to be part of the daily operations of Øra AS. While fishing, the vessel will operate emissions free, eliminating all greenhouse gasses including CO2. The boat will also generate less noise and vibration than a standard diesel engine-powered fishing vessel.

“We have been working on this electric boat design for some time and Corvus batteries are part of the design solution.

Their innovative battery technology enables the vessel to meet the needed performance specifications, that is, to operate electrically for a full fishing day,” said Erik Ianssen, Selfa Arctic AS President & CEO. “With successful sea trials completed we are planning serial production of the vessel.”

“Siemens is an industry leader in the development of environmentally friendly propulsion technologies. For smaller vessels such as the Selfa Elmax, we have developed BlueDrive PlusC, an extremely flexible, compact and high-capacity electric hybrid propulsion system which is designed to provide maximum efficiency.

When integrated with a Corvus lithium ESS we can nearly eliminate all emissions, making for one of the greenest fishing boats on the water today,” said Ole Johan Hungnes, Sales Manager, Siemens Marine.

“We are very pleased to be part of this new and exciting development in fishing vessel design. Our ‘marine-hardened’ battery technology is a good fit for the groundbreaking electric drive Selfa Elmax,” said Andrew Morden, President and CEO, Corvus Energy.

Corvus Energy makes the only lithium ion ESS Type-Approved by Lloyds, DNV and ABS. For more information, visit www.corvus-energy.com.

NEWS BRIEFS ClassNK releases annual report on Port State Control

C

lassNK (Chairman and President: Noboru Ueda) has released its annual report on Port State Control.

The report aims to assist ship operators and management companies in maintaining compliant operations by providing information about ships detained

by PSC as well as deficiencies that were found on board from many port states in 2014.

PSC inspections ensure that vessels departing the port meet international standards and have proved to be highly effective in eliminating substandard ships that are in operation. They oversee not only the physical structures and components of a ship, but also examine operations such as maintenance and ensuring that personnel have an adequate understanding of how to operate ship equipment. Over 100 port states have signed a Memorandum of Understanding (MOU) over the years and established a harmonized system for Port State Control to strengthen PSC-related activities,

ensuring maritime safety, decent working and living conditions, and reducing maritime pollution.

To help its customers improve safety management systems and overall fleet quality, ClassNK has included a breakdown of deficiencies which shows that lifeboats, emergency fire pumps, and fire-dampers continue to be the major items where most detainable deficiencies are found. The ClassNK report also provides detailed analyses on PSC detentions by flag state, port state, ship type, ship size, and ship’s age as well as a summary of major amendments made to international conventions such as the SOLAS Convention. These amendments have further widened the scope of PSC inspections, a trend that will undoubtedly continue as the rules applied to ships increase and diversify.

You can obtain the PDF version of the Port State Control Annual Report for free at the ClassNK website (PDF Publications on PSC) — www.classnk.org.

ClassNK has released its annual report on Port State Control

October 2015 BC Shipping News 11

INDUSTRY INSIGHT

Vital links

B

C Shipping News is pleased to present two very different perspectives on the ferry industry — the Canadian viewpoint with Serge Buy, CEO, Canadian Ferry Operators Association (CFOA); and the international angle with Len Roueche, CEO, Interferry. While their focus and realm of operations vary significantly, you’ll see common themes run throughout their answers. From safety issues to operational improvements to technological advances and best practices, both representatives are well-versed on the relevant issues that impact their members and we are treated to one of the most insightful articles on any industry we’ve done to date.

BCSN: Let’s start with a bit of background. Could you provide a brief history, your mandate and some of your main activities?

SB (CFOA): The CFOA was incorporated in 1987 so we’ll be celebrating our 30th anniversary in couple of years. The ferry industry in Canada however, has existed since the early 1700s. Canada was built by ferries — it allowed people

>>> From safety issues to operational improvements to technological advances and best practices, both representatives are well-versed on the relevant issues that impact their members... to travel and transport goods to some of the most outer regions of the country.

In 2012, the CFOA underwent a renewal. The head office was moved from New Brunswick to Ottawa which allowed us to strengthen our mandate, namely to be the advocate for the ferry sector at the national level.

We have over 70 members from all across the country, including the operators of all of the major ferry routes in Canada, every provincial government (except for Alberta but we collaborate with them frequently), and many others who interact with the ferry sector and have a stake in its wellbeing. The members we have who are ferry operators have varying corporate structures — federal crown, provincial governments,

provincially owned companies, municipal governments, regional entities, native bands, and even private companies.

Some of our main activities include advocacy on behalf of the ferry sector; and provide general information to the public and media to raise awareness of the industry in Canada. We also have our conference which facilitates professional development and the exchange of best practices amongst members but also provides an opportunity for operators to meet with suppliers which helps with product knowledge on new technologies.

We have achieved quite a bit in the past few years. We have a best practice library, a detailed map of ferry routes across Canada, four videos covering topics such as the economic impact of the

Photos: Top row: British Columbia, Canada — BC Ferries’ Coastal Renaissance (BC Shipping News); Britain/France — Condor Ferries’ Commodore Clipper (www.condorferries.com); Croatia — Jadrolinja’s Dubravka (www.shipspotting.com, Alessandro Zocca, Italy); Middle row: Englishtown, Canada — Government of Nova Scotia’s Torquil MacLean (BC Shipping News); Toronto, Canada — Toronto Island Ferry’s Thomas Rennie (www.wikimedia.org/Tony Hisgett); Catalina Express’ Jet Cat Express (www.shipspotting.com); Bottom row: Norway — Stena Line’s Stena Severine (www.stenaline.com); New York, USA — Staten Island Ferry’s Guy V. Molinari (www.libertyharborrv.com); St. John’s, Canada — Marine Atlantic’s MV Leif Ericson (www.wikimedia.com/RFBailey)

12 BC Shipping News October 2015

INDUSTRY INSIGHT ferry sector, safety, the environmental sustainability of ferries and how ferries impact on rural regions.

LR (Interferry): Interferry originated 40 years ago in the U.S. as the International Marine Transit Association.

Substantial changes were initiated at the turn of the century in order to transform the association into a more professional organization. This included the hiring of a full-time CEO, active engagement in the regulatory process (with consultative status at the International Maritime Organization), a major membership drive, and a change of name to Interferry.

We have over 200 members from 35 countries. In addition to ferry operators of all types — RoPax, RoRo, cruise ferries, fast ferries, passenger-only ferries, etc., we have suppliers to the industry who support our objectives — shipbuilders, naval architects and marine engineers, equipment manufacturers, classification societies, etc.

Our main activities revolve around the conference which we’ve held every year for the past 40 years. It is the main conference for ferry operators around the world and serves as a unique opportunity for networking and sharing ideas across regions and cultures. With our consultative status at IMO, we began actively monitoring new and proposed regulations. The experience we have gained in the IMO process has allowed us to become more involved in the initial stages of regulatory development. Our regulatory work is directed by the Operators Policy Committee with representatives from 21 ferry operators, including Marine Atlantic and BC Ferries from Canada.

BCSN: What is the size of the industry under your purview?

SB (CFOA): Sure. Estimates in 2012 showed that there were over 280 ferries operating on some 180 routes in Canada with the majority of those (179 vessels and 112 routes) falling within CFOA’s membership. Annually, ferries in Canada transport more than 55 million passengers and nearly 19 million vehicles.

While it’s difficult to get a complete picture of the economic impact of the ferry sector in Canada (because some government departments don’t differentiate between highways and ferries), we estimate that our members employ about 8,400 people and generate 22,600 indirect jobs. Our Footprint Study showed that annual operating budgets for members amounted to over $1 billion with about $437 million in salaries.

Serge Buy

Len Roueche

LR (INTERFERRY): At our conference in Vancouver last year, Philippe Holthof gave a presentation that provided a good overview of the size, scope and diversity of the world ferry fleet. After first defining some basic criteria, Holthof estimated that there were 1,085 displacement ferries over 1,000 GT, plus 111 freight-only ro-ros

with a capacity exceeding 12 passengers; there were 222 pure freight ro-ros with a capacity of up to 12 passengers; and 1,877 lightweight fast craft (180 with car capacity and 1,697 passenger-only fast craft).

There are over 450 ferry operators carrying over 2.1 billion passengers, almost 258.5 million cars and over 39.3 million

CEO, Canadian Ferry Operators Association

CEO, Interferry

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INDUSTRY INSIGHT We create jobs, ferries matter — they allow people to get to their jobs and have food on the table — not just because they have a job but because the food came via a ferry. trailers. I should qualify that some of this information has been distillated from places where numbers are more difficult to come by. We don’t yet have members in China, Russia or India and only a few from Africa so the numbers for those countries are estimates.

BCSN: What are your current priorities?

SB (CFOA): The Building Canada fund is an important one. Ferries have been excluded from the Building Canada plan and there is significant concern that the government has not understood the need for the ferry sector and the importance of the sector on Canada’s infrastructure. We create jobs, ferries matter — they allow people to get to their jobs and have food on the table — not just because they have a job but because the food came via a ferry.

Another tariffs onPM SCA0079A Adpriority - BC Shippingrelates News.pdf 1to9/2/2015 3:06:15 new vessels that are built offshore. In

14 BC Shipping News October 2015

Canada, if you want to build a ferry of significant size, you can’t do it with the current capacity of Canadian shipyards. The tariff on new builds under 129 metres is 25 per cent and that can be significant.

For example, the new BC Ferries vessels being built in Poland will have a tariff of about $40 million; or the Government of Newfoundland and Labrador will be paying a $25 million tariff — it’s not an insignificant amount.

Initially, the tariff was on all ships but it was then modified to exclude freighters and vessels over 129 metres. It was kept for vessels under 129 metres to protect the shipbuilding sector in Canada but, for a number of reasons — not the least of which is that the main shipyards are busy with the government’s National Shipbuilding Procurement Strategy (NSPS) vessels — this doesn’t make sense

anymore. Canada has signed a number of trade agreements which will eventually cancel the tariff. Agreements with Europe, Korea, and the Trans-Pacific Partnership will all cancel the tariff. So it will disappear but the question becomes when. The ferry sector needs to be rebuilt and it needs to happen now, not eight or nine years from now when the agreements kick in. Ferry operators can’t just wait until the tariff is no longer there. We were hoping to get some movement on that but need to wait for the federal election to be over to address it.

There are other smaller priorities: For example, we’re looking at putting together a “Ferry Operator 101” manual that looks at all the acts and regulations relevant for ferry operators and compile them into one resource. It’s a significant amount of work. We’re just going through the RFP process right now.

LR (IF): Our number one priority at this time of year is the annual conference; this year, in Copenhagen in October.

We are also completing the integration of our regulatory office in Europe into the Interferry structure. Four years ago

Interferry decided we needed a full time position in Europe to co-ordinate our regulatory activities at the IMO and the European Union. A small group of our largest operators agreed to fund the startup for three years and hire a Director of Regulatory Affairs. This year marked the end of the start-up period with full financial responsibility passing to Interferry.

That necessitated a major increase in membership fees and I am pleased to report that by the end of August we had achieved our revenue target thanks to the strong support of the membership.

Another important priority is the recruitment of a new CEO since I will be retiring in March 2016.

BCSN: I’d like to now focus on trends, starting with passenger volumes.

SB (CFOA): Passenger volumes have generally trended downward for a number of years, up to about 2013. We’re expecting to see an uptick in our survey that will be released this fall. A number of factors come into play when looking at trends — there is the regular passenger traffic but there is also tourism-related activity which rises and falls with the economy and the value of the Canadian dollar. That has a significant impact throughout the country. There are also factors like improved road infrastructure — a bridge is built or, looking at the example of the Toronto Island Airport, a tunnel is built. Passenger numbers in 2016 will show a drop because three million people that used to take the ferry, will now be using the tunnel.

LR (IF): It’s very difficult to generalize passenger volumes for all of the countries of our members. There are many unique issues and situations on a regional basis that impact on volumes. Suffice to say though that the industry will always be a critical and necessary link in transportation chains around the world.

BCSN: What about the vessels? Are you seeing trends in fleet renewal in terms of different propulsion methods and new technologies?

SB (CFOA): The average age of Canada’s ferry fleet is about 35 years and that’s a bit of a concern. It’s not old compared to other countries but does indicate that changes will be coming. We’re seeing more and more conversions to LNG and there are also new technologies and equipment dealing with safety and navigation. Those technologies — especially on the bridge — are reducing the burden on crew while improving safety so we’re seeing positive results and good progress.

October 2015 BC Shipping News 15

INDUSTRY INSIGHT

Photo source: www.vikinggrace.com

Photo source: www.stenaline.nl

From the first LNG-fuelled vessel, the Viking Grace, to the first methanol-fuelled vessel, the Stena Germanica, the ferry industry leads the way in breaking new ground with alternative fuels .

LR (IF): Again, it’s difficult to lump all companies into specific categories — it’s just too diverse an industry but when you compare the size of the fleet to the number of new builds planned, you can see that there’s hardly a dent being made in fleet renewal. So the average age is increasing.

In looking at trends for propulsion, we are seeing more diversity — on a smaller scale, there are electric and hybrid engines being put to use; on a larger scale, LNG is being considered more and more, especially in Europe. And everyone is watching to see the results of Stena Line’s conversion to methanol.

Fires on car decks have become a big safety issue with several major incidents over the past few years. One of those, the Norman Atlantic, had a fire on the car deck in late 2014 and at least 23 people lost their lives (out of a total of almost 500 passengers and crew). A number of issues have been identified out of that incident, including the design of the ship, crew training, and evacuation procedures. This features large on the agenda for our upcoming conference and we have a number of experts who will be discussing this in great detail. We are also preparing for discussions at IMO on fire regulations.

BCSN: What about trends in environmental sustainability?

SB (CFOA): In Canada, we have one of the best records for environmental sustainability. The sector compares very favourably to any other mode of transportation and we’re quite happy with that. There are a number of recent examples where CFOA members have been demonstrating leadership: In 2008, BC Ferries launched the three largest double-ended ferries in the world that exceed the environmental standards set by the International Maritime Organization and the U.S. Environmental Protection Agency. Each vessel includes features such as onboard sewage treatment plants and high-efficiency

16 BC Shipping News October 2015

propulsion systems. Marine Atlantic’s new North Sydney Terminal will be modern, efficient and environmentally friendly; and Société des traversiers du Québec (STQ) as well as BC Ferries are introducing LNG-fuelled vessels to their fleet which will reduce greenhouse gas emissions and reduce maintenance costs.

LR (IF): Interferry has been very concerned about new environmental regulations that are implemented before the necessary technology is available. This has occurred recently with both sulphur emissions in environmental control areas and ballast water management. We have struggled with approvals for sulphur scrubbers and the installation of LNG fuel tanks. The same applies with ballast water technology to curtail invasive species, but in addition to that we have been trying to get simplified procedures for exemptions on short routes. It is not logical that the same rules that apply to ships on trans-oceanic voyages should also apply to ferries on very short crossings.

BCSN: Could you describe the regulatory regime you work under and what sort of new or proposed regulations are impacting the industry?

SB (CFOA): We work closely with Transport Canada. In general, we have a very good relationship with regulators but there are some areas where there is a gap between understanding and delivery. Our operators would like to see faster and more responsive decisions but we recognize that it’s difficult for Transport Canada (TC) to act on issues quickly. One example that comes to mind is the issue of crewing onboard cable ferries — TC regulations don’t differentiate between regular and cable ferries so we’d like to get that resolved quickly. Another example is the ice-breaking fees charged to ferry operators where there is no ice, and if there is ice, there are no vessels.

LR (IF): I have already mentioned several regulatory issues including sulphur, ballast water and fire safety. Another very technical issue we are working on is the damage stability rules with the possibility of moving from a prescriptive to a probablistic approach. When the issues become extremely technical and even theoretical it is not easy to predict the outcome and impact of new regulations.

We are also working with the International Chamber of Shipping on the definition of a passenger ship. The IMO considers cruise vessels and ferries both as passenger ships. It is sometimes hard to believe that the same rules apply to both 6,000-passenger cruise ships and 100-passenger ferries.

Nevertheless, we need to be cautious before recommending any change because we want to avoid any unintended consequences.

BCSN: I’d like to ask now about the future of the ferry industry — what are the important factors to watch?

INDUSTRY INSIGHT SB (CFOA): The future of the industry continues to be bright.

We will continue to see a sector that is healthy, vibrant, safer and more environmentally friendly. And, of course, it will continue to have a large economic impact on the country. I think you’ll see a sector that will be more present in the public – we need to be more assertive, we’ve been too silent in the past and that needs to change. For example, the report from the House of Commons Transport Committee on Infrastructure in Canada was very well done but it forgot to include ferries. That’s a significant concern for us.

Canadians know about highways, airports and trains but a lot of Canadians don’t realize how important the ferry system is for our country. It’s a way of life for many people — a way to get to work and to bring goods to communities. It is a vital link for many people — some regions are only reachable by ferry.

LR (IF): At some point, there will be a major increase in new building activity to replace the aging fleet. The economic recovery over the past six or seven years has not been strong enough to generate the investment needed. Perhaps the day of reckoning will be put off again if we are in fact heading into another recession. Offsetting this impact is the very attractive fuel price now on offer.

There are a number of exciting emerging technologies that may change operations significantly — for example, 3D

About Serge Buy

S

erge serves as CEO of the Canadian Ferry Operators Association (CFOA), the organization that represents the great majority of the ferry sector in Canada. Since his arrival in 2012 at CFOA and with support and guidance from the Board of Directors, the organization has doubled the number of operators involved and its Conference now attracts industry participants from all over the globe.

Serge has also helped CFOA increase its visibility and strengthen its credibility as the voice of ferries in Canada with participation in various parliamentary initiatives and media outreach.

After more than a decade working in politics, Serge, started in 2000 to represent various organizations at the provincial and federal level. He heads a lobbying and association management firm with offices in Ottawa, Toronto and Victoria.

About CFOA

printing. What started as a tool for developing plastic samples has developed into a multi-billion industry focussing on production of advanced geometrics for various manufacturing industries. New materials and printing techniques have been developed, and today some of the most advanced parts for the aviation industry, Formula 1 racing, high-performance yachting and the construction industry have extended the utilization of 3-D printing. Reduced production costs, faster production time, increased accuracy and a significant reduction of weight are some of the drivers that will change the way ships are designed, produced and operated in the future.

Another technology trend that is advancing significantly is increased “ship intelligence.” Features like automation, smart controls, robotics, optimization and decision-support tools, equipment and system health management and predictive maintenance schemes are all under research and it’s only a matter of time before they start to impact on the shipping industry.

One of the presentations at our conference looks at the studies that indicate we’ll see the first remote-controlled ferry demonstrator take to the water within five years.

On a broader scale, ferries are being recognized as an efficient and sustainable mode of transport, especially in the urban environments of both the developing and developed worlds.

A concrete example of this process is the recently appointed United Nations High Level Advisory Group on Sustainable Transport which includes 12 individuals representing various disciplines and modes from around the world. Interferry was selected to represent the ferry sector. BCSN

About Len Roueche

L

en Roueche is the Chief Executive Officer of Interferry, a shipping association representing the world-wide ferry industry. Since Len became CEO in 2002, the association has grown by over 140 per cent and has established itself as the voice of the ferry industry at IMO. Prior to joining Interferry, Len was with BC Ferries for 25 years where he was responsible for strategic planning. He has a B.A. from the University of Victoria and an M.A. from the University of British Columbia, both in economics.

About Interferry

The Canadian Ferry Operators Association is the national voice of ferries in Canada. Our members operate with the highest professional and operational standards and promote the safe operation of ferry services in Canada. With over 55 million passengers, 19 million vehicles and billions of dollars of goods transported annually, the ferry sector is a crucial part of Canada’s infrastructure. Collectively, CFOA members employ nearly 9,000 crew/staff that are highly trained to respond to emergencies.

Interferry is the highly respected shipping association representing the ferry industry world-wide. There are currently over 200 members (representing more than 600 individuals) from 35 countries. The membership includes all types of ferry operations: RoPax, RoRo, Cruise Ferries, Fast Ferries, Passenger-only Ferries, big and small ferries.

Interferry’s primary roles are to facilitate networking and communications within the ferry industry and to represent the industry on regulatory and policy matters.

For more information: www.cfoa.ca

For more information: www.interferry.com October 2015 BC Shipping News 17

HISTORY LESSON Photo credit: Dave Roels (www.daveroels.com)

A

rguably one of the most ingenious inventions, sails have been around almost as long as the boats they propel. They have been used for thousands of years up until the advent of steam engines. Today, sails seem to be making a comeback. At first they were merely a means to an end, but now with concerns over carbon footprints and environmental sustainability, naval architects are again incorporating sails into cargo vessel design. So let us take a look at how sails came to be, how their use declined, and how they are making a comeback.

The ancient sailing ship

First, of course, came the invention of the boat. In fact, some archaeologists believe that the ancient indigenous Australians used some sort of boat to inhabit the continent as far back as 50,000 years ago. Some of the earliest evidence of sailboats comes from archaeological studies that show they date back to at least 6000 BCE in ancient Mesopotamia. This evidence comes in the form of surviving ship models, painted

The rise, fall and return of sail

By Lea Edgar

Librarian/Archivist, Vancouver Maritime Museum

>>>...with concerns over carbon footprints and environmental sustainability, naval architects are again incorporating sails into cargo vessel design. depictions, and some full-scale boats as well. It is possible that sails date back even earlier as movements of ancient humans across oceans and to unseen islands is well known. Perhaps they used some sort of rudimentary sail to accomplish these journeys. But from what evidence we have, sail technology seems to have spread from Mesopotamia to the Mediterranean, on to Egypt, and eventually the world.

The age of sail, the end of sail

Now fast forward to the so called “Age of Sail” beginning roughly in the 1500s.

This is the time when sailing ships travelled the world and were employed extensively for military and civilian use.

Although this era does not have a firm start or end date, many date its beginning to the Battle of Lepanto (1571) and the

last major use of oar-propelled galleys.

When a steam-powered vessel destroyed the USS Cumberland and the USS Congress during the American Civil War’s Battle of Hampton Roads (1862), it effectively ended the use of sail ships in warfare.

The steam engine was first used on smaller vessels called steamboats. With a lot of experimentation, the design was eventually improved enough to be implemented on larger vessels called steamships. The engine was first used to power paddlewheels but later was developed to propel screws. This design innovation allowed for ocean-going, transAtlantic steamships. The use of steam engines even changed the way ships were designed in an effort to increase speed.

The steam engine, besides having the benefit of greater and more consistent speed, freed vessels from following trade winds by sail. This marked the end of the cargo sailing ship as they slowly faded from use. Sailing vessels are now mainly pleasure craft and small scale fishing vessels.

A return to sail?

A mix of vessel types. Sternwheeler Lightning being towed by the Union Steamships Co.’s Capilano and a sailing vessel in the back ground, ca.

1900. VMM negative 15277.

18 BC Shipping News October 2015

But then again, perhaps this is not the end for the cargo sailing ship. Modern pressures and concerns are drawing naval architects back to sails. The increasing “green” design emphasis encourages a return to sailing ships as a viable alternative to burning fossil fuels. There are a surprising number of companies attempting to bring back the cargo sailing ship, although with some modern twists. The

VANCOUVER MARITIME MUSEUM Source: Thiiink Source: Skysails

Conceptual drawing of the THiiiNKsail flettner rotors on a cargo ship.

SkySails in action on the MV BBC Skysails.

dream of a wind-powered cargo ship has not yet been realized but there are some fascinating designs being put forward.

There are three main kinds of modern cargo sailing ships: wind-assisted motor vessels, hybrid wind/motor vessels, and pure wind vessels. Two examples of interesting designs for wind-assisted motor vessels are SkySails and the THiiiNKsail rotor. SkySails are essentially very large kites attached to cargo vessels in order to propel the ship. Using the sails reduces fuel consumption and lowers emissions. The benefit to this technology is that it is simple and can easily be retrofitted to operating vessels. The THiiiNKsail rotor is essentially an improved

Canada’s Pacific Gateways A new book by Dr. W.B.M. Hick Canada’s Pacific Gateways is a lavishly-illustrated chronicle of trade and development on the West Coast. It is a history of dreams and vision, of political will and, at times, political expediency. Dr. W.B.M. Hick delivers a lively account of the people — the visionaries, financiers, and workers — who built the ports at Vancouver and Prince Rupert and the vital transcontinental rail corridors that serve them.

flettner rotor that spins on the deck of a vessel creating lift. This is an old but unique concept updated for modern use.

There are many more interesting designs for hybrid wind/ motor vessels. One is the proposed Vindskip vessel. Shaped like an air foil, the whole vessel acts a single sail and uses the wind to create lift. It is then assisted by an LNG-electric propulsion system, creating a fuel savings of approximately 60 per cent. Other remarkable designs make use of rigid sails, solar sails, and more traditional sails.

Harnessing the wind seems to be the direction commercial shipping will head in, perhaps utilizing combinations of some of the new designs mentioned here. It is exciting and gratifying that naval architects are looking back into history in order to move us forward. With green transportation technology on the rise, perhaps these new designs will usher in the second Age of Sail.

Lea Edgar started her position as Librarian/Archivist for the Van-couver Maritime Museum in July 2013. She can be contacted at archives@vancouvermaritimemuseum.com.

Marine paintings, special commissions, talks, reproductions and books...

John M. Horton, Marine Artist

 Order online at www.canadaspacificgateways.com | $39.99 (CAD)

The Franklin Expedition’s HMS Erebus and Terror A British expedition led by Captain Sir John Franklin departed England in 1845 to explore and chart the last unnavigated part of the North West Passage and were last seen in Victoria Strait. Many expeditions have tried to find these ships, but it was not until fall 2014 that the Victoria Expedition found the wreck of HMS Erebus.

This painting was produced in honour of that discovery and shows the Erebus in the foreground and Terror in the background.

This painting is available for sale. Please contact us to find out which gallery currently has it on display.

(604) 943-4399 john@johnhorton.ca / www.johnhorton.ca

Untitled-1 1

2/7/2013 1:14:42 PM

October 2015 BC Shipping News 19

FERRIES IN ASIA Living dangerously on a Filipino ferry

By Jaya Prakash

I

>>>...the only single assurance when boarding a ferry — be it in the Philippines, Indonesia or Bangladesh — is that making it to one’s destination is a roll of the dice.

Sea travel is one of the most hazardous of all businesses in the Philippines. It is not just the treacherous waters surrounding the country — though the tide of horrendous typhoons and cyclones has wreaked untold havoc on the nation in recent years — but the mere fact that sea travel is the only mode of transport connecting thousands of islets, makes it an indispensable danger Filipinos must endure.

Though it was an unusually balmy day when the Kim Nirvana went down, the very nature of sea travel in the Philippines has been haphazardly executed, monitored and audited, leading many to conclude that the only single assurance when boarding a ferry — be it in the Philippines, Indonesia or Bangladesh — is that making it to one’s destination is a roll of the dice.

Source: Wikipedia

t all began innocently enough for the Kim Nirvana on a morning in July 2015 in the Philippines. The vessel with its human cargo was heading for the central islands of Camotes in Cebu province.

It was a routine commute yet just a few minutes after the boat left Ormoc port on that fateful day, it capsized and sank. As it happens all too often in the Philippines and in almost all documented sea tragedies, the sinking took with it scores of human lives. Instinctively, it drew widespread recriminations coupled with what has become the national hobby of assigning blame for this latest ‘genocide.’

In 2013, at least 113 people perished when the Thomas Aquinas sank; in 2008, the MV Princess of the Stars capsized in a storm and resulted in the deaths of 437 souls; 94 people died in 2004 when SuperFerry 14 caught fire; 389 lives were lost in 1988 when the MV Dona Marilyn was caught in Typhoon Unsang and sank; a figure dwarfed by the 1987 Dona Paz disaster which killed a staggering 4,341 people after a collision with an oil tanker.

The MV Dona Paz passenger ferry, which sank on December 20, 1987, is considered the worst Philippines inter-island shipping accident with over 4,000 souls lost.

20 BC Shipping News October 2015

Contributing factors

Ferries in the Philippines, Indonesia and Bangladesh do not just carry people.

Every manner of cargo — from livestock to flammable substances like copra — are herded into these often creaky, rickety craft bought from fire sales in other parts of Asia. And because these vessels are worn-out and second-rate to begin with, it’s easy to imagine their desultory state of repair and maintenance as they remain in service well beyond their expiry date.

It’s not just the age of the vessel that impacts on safety — the design of these vessels is at issue as well. More often than not, second-hand vessels bought from Japan and Korea, and built with the placid waters of those countries in mind, are ill-suited for the sometimes monstrous sea surges experienced around the Philippines and Indonesia.

Further, as was seen in the recent Sewol ferry disaster in South Korea, the instance of unsecured cargo that was blamed for causing the vessel to tilt, demonstrates yet another failing of the South East Asian ferry system. Whether through a lack of proper ballast water to stabilize vessels, exceeding the capacity of the cargo hold, or simply inadequate maintenance and repairs, these are areas where the expertise and professional counsel of reputably trained naval architects should be sought out yet, surprisingly, they are excluded from discussions.

While geography and exposure to adverse weather conditions can play a role in making sea travel dangerous, it is

FERRIES IN ASIA Source: Istockphoto

too often the case that the direct cause of ferry disasters is human error and negligence. Still, technologically advanced weather monitoring stations in and around disaster-prone areas would be a welcome respite to forewarn sea travellers of impending danger.

Notwithstanding, so much more still depends on the cultivation of a safety culture. The lack of a safety culture is perhaps the most vexing of all.

Lots of talk, little action

A Regional Forum on Domestic Ferry Safety held in Bali, Indonesia in December 2011 openly denounced the unsafe practices of ferry operators and urged all governments to support and audit/monitor masters and operators to ensure they were fulfilling their safety obligations. Though Asian governments have in recent years, made a virtue of who can outclass the other on pledges to improve maritime safety, in practice, very little ever gets done.

Despite requests from the International Maritime Organization for greater adherence to overarching, supranational remits, ferry operators continue to be subject only to national legislation. “In many cases, such ferries are not even subject to regular inspections and that sometimes causes safety standards to drop rather rapidly,” said BIMCO maritime analyst Peter Sands to this BC Shipping News writer. “Clearly, based on so many cases, proper adherence to specific limitations in terms of passenger and cargo has been disregarded. Also, the ISM Code is neither taken seriously nor applicable to such ferry trades.”

To his delight, Sands found an ally in the cousin of the President of the Philippines.

Senator Paolo Benigno Aquino told his countrymen recently of a compelling need to investigate if the nation’s maritime vessels are anywhere near seaworthiness. Visibly livid at the casual pace of inspections and investigations, he demanded to know of the navigational experience of concerned government agencies and why the request for seaworthy vessels has “remained unanswered through the years.”

In one positive step, Manila has now mandated that passengers be required to wear life vests coupled with what are steeper fines for ferry safety violations. And although Indonesia passed laws years ago aimed at boosting ferry safety, those laws have hardly seen the light of day, pointing perhaps to what is

A necessary evil...when travelling by ferry in the Phillipines, Indonesia and Bangladesh (above), passengers gamble their lives for a safe passage.

an ingrained culture of inertia illuminated only in times of disaster.

Competence, in deficit always!

Despite well-meaning rancor from well-intentioned quarters, a check by BC Shipping News on the Philippine Register of Societies showed that unless contracted by the ship owner, class societies cannot even intervene to class vessels.

And when it does intervene, its role is limited to determining the hull integrity and reliability of machineries and equipment through periodic surveys.

Statutory surveys and certifications covering matters such as load line, stability, safety equipment and radiotelegraphy, to name a few, are done by governments unless delegated to class societies.”

The Register later went on to add that worse, there are many competing local class societies, allowing ship owners to “shop” for the cheapest, not the safest or most qualified.

Like naval architects and class societies, maritime insurers and surveyors are also excluded from the overall

October 2015 BC Shipping News 21

FERRIES IN ASIA scheme of contributing to a safety culture in either the Philippines or Indonesia.

Not making it any better is the lack of public education and awareness campaigns to arouse public sensibility.

Little wonder that former Philippine Transport Secretary Elena Bautissta once told a U.S.-based international weekly that, “the main issue here is the safety culture of the Philippines.” And nowhere has that remiss in abatement been more pronounced than when captains, prodded by fleet operators, take unconscionable risks by filling aging, decrepit vessels beyond safety limits and then set them to sail in the dangerous weather conditions and waters of the Philippines.

When Philippine ferry captains submit a document called the Master Oath of Safety Departure (MOSD) to the coast guard, it is incumbent upon them to accurately disclose the number of passengers on board. But as is almost always the case, that requirement is relegated to the back burner with the eventual result

being an overloaded, capsized vessel and many deaths.

A common-sense solution

In tallying up all the factors that go into — or rather are absent — from the ferry sector to provide for safer sea travel, urgent action is required to avoid additional deaths. The IMO and international intervention is needed. Whether it is through an international inspection team, the implementation and enforcement of IMO regulations, or simply greater encouragement and collaboration between the international community and local ferry operators, we must find a way to trade in the old habits for a newfound sense of urgency aimed at fostering confidence in the Asian ferry system.

One common-sense solution that is herein presented for the reader’s consideration, would be to improve alarm systems aimed at avoiding overloading.

Between them, the Philippines and Indonesia are considered to be two of the world’s most widely diffusive nations with, cumulatively, more than

30,000 islets. As noted earlier, weather warning systems in more disasterprone or frequently travelled areas would contribute greatly to the safety of ferry passengers, but given the complex geography, it would be impossible to adequately cover the full region, either by monitoring stations or coast guard agencies.

A more practical approach would be to install alarm systems on ferries, similar to those used in elevators, that immediately buzz when excess weight is detected. Those signals would then be transmitted to coast guard who could move in to restrain the vessel from moving out to sea.

This author approached Roberta Weisbrod, Executive Director of the Worldwide Ferry Safety Organization, to discuss the concept of alarms to detect overloading. “It’s a great idea,” she said, adding that there is already an Apple App — SCRAMP — designed for fishing boats which sounds an alarm when it senses destabilization.

“The Worldwide Ferry Safety Organization plans to commission research to explore how alarm systems can be [made] applicable for ferries. The same research would explore what other alarms are out there — including those devices that can count people electronically,” said Weisbrod.

In exploring an alarm system, a conceivable approach would be to study the ship design of crew boats and offshore supply vessels wherein relevant features could be incorporated into ferry designs along with proper ramps for ro-ro vehicles and more secure cargo areas as well as proper procedures for loading and securing cargo. Each of these features, coupled with passenger-tracking, should incorporate alarms that are set off the minute capacity is breached.

Despite the rudimentary bent of the suggestion above, evidence still shows that close to 1,000 people die every year riding on the back of old, creaky vessels owned by operators who pay little or no heed to safety in jurisdictions where there is no enforcement of safety regulations.

Until the time comes when the neglect of safety is no longer tolerated, ferry travel in South East Asia will continue to be a gamble with one’s life.

Jaya Prakash is a Singapore-based maritime journalist. He can be reached at prakruby@hotmail.com

22 BC Shipping News October 2015

LNG FERRIES Introducing LNG to the BC Ferries fleet >>>...BC Ferries is getting ready to be one of the first ferry companies in North America to operate passenger ferries running on LNG.

Image courtesy BC Ferries

to convert the vessels to run as dual-fuel on either LNG or marine diesel, however running primarily on LNG. The contract for the Spirits’ MLU is expected to be awarded later this year.

The LNG conversion for the Spirit of BC would take place in the fall of 2017 through the spring of 2018 and scheduled to be back in service for the late-spring/ summer season of 2018. The Spirit of Vancouver Island would be the following year — fall 2018 to spring 2019 for the conversion and back in service for latespring/summer 2019. The conversion to LNG is a capital investment opportunity to reduce fuel costs by approximately 50 per cent.

BCSN: What other work is being done on the Spirit-Class vessels as part of the MLU? ML: In addition to the conversion to LNG, component replacements are required to ensure the ships’ reliability for years to come and it is most cost effective to perform these updates during the MLU. These include renewing the fire detection and control systems, replacing

Photo: BC Shipping News

W

ith five vessels set to be running on LNG in B.C. by 2019, BC Ferries has a comprehensive plan in place to ensure they are ready to safely transition to the new fuel.

From having new ships built to suit their needs, to converting existing ferries to maximize their performance and preparing the crews with extensive training, BC Ferries is getting ready to be one of the first ferry companies in North America to operate passenger ferries running on LNG. Three new Salish-Class vessels will run as dual-fuel on LNG or marine diesel, and the company is planning on converting the two existing Spirit-Class vessels to LNG as well. BC Shipping News approached Marcel LaRoche, Director, LNG Engineering at BC Ferries to find out how the new vessels will be managed within the fleet.

BCSN: Why is BC Ferries planning to use LNG as a fuel for the new Salish-Class vessels and the existing Spirit-Class vessels?

ML: There are two main reasons for converting to LNG as a fuel source. The first is that LNG costs significantly less than marine diesel fuel so that will help reduce upward pressure on fares.

The second reason is that LNG will play an important role in improving BC Ferries’ environmental footprint. The adoption of LNG cuts carbon emissions, almost completely eliminates sulphur oxides, reduces nitrogen oxides to a fraction of what we see from marine diesel fuel and nearly eliminates particulate matter. Reducing these elements from the exhaust from our ships improves air quality along the coast and improves the overall carbon footprint of BC Ferries.

The strategic decision to introduce LNG into BC Ferries’ fleet is an innovative measure that combines an environmental benefit with a significant commercial advantage. From this perspective it is judged to be a “win-win-win situation” for BC Ferries’ customers, the natural environment and all stakeholders of BC Ferries.

BCSN: When will the existing SpiritClass vessels be converted to LNG? ML: The Spirit of British Columbia and the Spirit of Vancouver Island are the primary vessels serving the Swartz Bay/ Tsawwassen route and were delivered in 1993/1994. Now at their mid-life upgrade (MLU) points, the company is planning

Marcel LaRoche, Director, LNG Engineering, BC Ferries

the rescue boats and davits, rebuilding the controllable pitch propeller system, upgrading the heating and air conditioning systems, renewing the power management system and replacing the bridge and navigation controls, among many other upgrades.

The new Salish-Class vessels — the Orca, the Raven and the Eagle — will enter into service between late 2016 to early 2017.

October 2015 BC Shipping News 23

LNG FERRIES BC Ferries is working to ensure an equivalent level of safety, security and dependability...commensurate with the current use of marine diesel oil as a marine fuel.

BCSN: When will the new Salish-Class LNG ships sail in B.C. waters?

ML: The Salish Orca is scheduled to arrive in British Columbia in late summer 2016 and is expected to be in service, replacing the 50-year old Queen of Burnaby on the Comox/Powell River route, in late 2016 following extensive crew training and familiarization.

The Salish Eagle is scheduled to arrive in fall 2016 and will replace the 51-year old Queen of Nanaimo, sailing on the Tsawwassen/Southern Gulf Islands route.

She is expected to commence service in early 2017. The Salish Raven is scheduled to arrive in winter 2017 and will also serve the Southern Gulf Islands. She is expected to start service in summer 2017.

BCSN: How is BC Ferries implementing LNG safely into the fleet as a new marine fuel?

ML: As we introduce LNG into the fleet, BC Ferries is working to ensure an equivalent level of safety, security and dependability is established that is commensurate with the current use of marine diesel oil as a marine fuel. To accomplish this, BC Ferries is working on a number of fronts such as: • Having the new vessels designed and constructed to a robust regulatory framework utilizing established standards, rules and regulations designed for ships using LNG as a marine fuel. This is accomplished through a regulatory framework established

by Transport Canada and combined with the rules and regulations of classification societies. As directed by Transport Canada, the International Code of Safety for Ships using Gases or other Low-flashpoint Fuels (IGF Code)

set forth by the International Maritime Organization (IMO), along with Lloyd’s Registers’ Rules and Regulations for the Classification of Natural Gas Fuelled Ships are being applied to the design and construction of the new Salish-Class ferries.

• Developing a training program designed to bring our ships’ crews, terminal operations, management and support staff to a level of competency that enables us to operate and maintain the ships and support systems to the same level of safety, dependability and security as we do using marine diesel oil. Training plays an important part in ensuring the highest level of passenger and ship safety and as such, BC Ferries is investing in training for its crews and support personnel that meets Transport Canada, IMO and BC Ferries internal training requirements for LNG-fuelled ferries.

• Employing a safety case approach to understand and manage the risks involved with the introduction of a new fuel like LNG into the fleet.

The safety case is a structured and

Natural gas. Good for navigating the future.

BC Ferries has chosen cleaner-burning, liquefied natural gas (LNG) to fuel three new ferries.

With LNG, carbon dioxide emissions will decrease by approximately 9,000 metric tonnes per year—the equivalent of taking 1,900 passenger vehicles off the road annually.* It will also help reduce fuel costs despite the recent decreases in oil prices.

From ferries and tractor-trailers, to delivery trucks and waste haulers, natural gas is navigating the future of B.C.’s heavy-duty transportation sector.

To learn more about natural gas for transportation and financial incentives, visit fortisbc.com/ngt or email ngt@fortisbc.com. *Source: Calculations and references, 2011 at epa.gov/cleanenergy/energy-resources.

FortisBC uses the FortisBC name and logo under license from Fortis Inc. (15.061.11 09/2015)

24 BC Shipping News October 2015

LNG FERRIES Photo courtesy BC Ferries

documented body of evidence generated through accepted risk assessment methods that enables the management of risk. It is also a requirement under the IGF Code, and because Canada is signatory to the IMO, a requirement of Transport Canada as well.

BCSN: Could you describe the properties of LNG and its safety record in being used a marine fuel?

ML: LNG is natural gas, the same kind many of us use in our homes for heating and cooking, but it has been cooled until it is condensed into a clear liquid, stored at approximately -162 degrees Celsius at very low pressure, close to atmospheric pressure. LNG is about 1/600th of its original volume as a gas and is therefore easier to store and transport. LNG is composed mostly of methane gas — about 94 per cent — and a variety of other gases in very small quantities.

The LNG industry has an excellent safety record. LNG has been used safely as marine fuel in LNG carriers worldwide for over 50 years. Many Norwegian ferries have operated on LNG for over 15 years, and it is growing in popularity with more

Part of the mid-life upgrade to the Spirit-Class vessels (above, the Spirit of British Columbia) will include converting the engines to run on either LNG or marine diesel oil.

ship owners having adopted LNG as a fuel source in response to new and future air emissions regulations. The successful ushering in of LNG-fuelled ferries into the Canadian, U.S. and European markets is viewed by BC Ferries as a strategic advantage as many critical technical, operational, and regulatory issues are being addressed, and with careful management, LNG will be introduced safely and to the benefit of all stakeholders in

British Columbia. BC Ferries intends to leverage lessons learned from partners and other adopters of LNG to introduce this fuel in the safest and most efficient manner.

Recently, BC Ferries joined the Society for Gas as a Marine Fuel (SGMF), a new non-governmental organization (NGO) established to promote safety and industry best practices in the use of gas as a marine fuel. Members represent all the

October 2015 BC Shipping News 25

LNG FERRIES A multi-tiered training program is in development that exceeds the current regulatory requirements and addresses all of the areas requiring knowledge development. global key players involved with LNG as a marine fuel.

BCSN: Where will the LNG come from?

ML: The fuelling process will be the same as fuelling with diesel — i.e., with trucks making deliveries to our vessels during non-operational periods.

BC Ferries has signed a contract with FortisBC to fuel the new Salish-Class vessels with LNG (the fuel supply for the Spirit-Class vessels has yet to be contracted). FortisBC has two existing LNG storage facilities, one at Tilbury in Delta and one at Mt. Hayes in Ladysmith.

These two facilities will provide the LNG needed to supply our vessels, with trucks making two to three deliveries of LNG each week, the same fuelling methodology and cycle we presently use for fuelling with diesel.

26 BC Shipping News October 2015

BCSN: What kind of engines will the Salish-Class ferries have?

ML: The Salish-Class ferries will be powered by three Wärtsilä DF-20 dualfuelled engines. LNG storage and processing for the engines will be provided

by Wärtsiläs’ LNGPac system. The vessels will also have marine diesel oil (MDO) storage and processing to support dualfuel and MDO-only operations.

BCSN: What other features will be distinct to these vessels?

ML: Safety systems will be designed to meet the regulatory requirements for LNG-fuelled ships. Because the vessels will also be using MDO, all of the traditional systems will be in place. These will, however, be supplemented by a few additional safety systems designed to address the characteristics of LNG.

These include inherently safe systems employing double-walled ventilated piping systems, gas and cold detection systems and firefighting systems specifically designed for LNG-fuelled ships.

BCSN: How is BC Ferries training its employees to work on the new ships?

ML: Other than the addition of LNG as a fuel, much of the process is the same for all of the crew as a new ship with new technology is introduced into the BC Ferries fleet. A training plan is developed by our operational training group that addresses all the requirements to ensure the vessel is competently crewed at all levels.

A multi-tiered training program is in development that exceeds the current regulatory requirements and addresses all of the areas requiring knowledge development. BC Ferries is being supported by industry experts and organizations with significant LNG operational experience. This includes the development of a Gas/LNG Safety course, LNG-fuelled vessel training as recently amended in the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers (STCW Code) and specific,

LNG FERRIES original equipment manufacturer (OEM) training from Wärtsilä in the operation of their LNG propulsion systems.

BCSN: Will you have a specific team dedicated to LNG or will all engineers be able to work on the new vessels?

ML: Within BC Ferries, the policy is that engineers, in fact all crew, must be cleared to work in their position on the vessel on which they are employed. Clearance is attained by meeting the certification, experience and training requirements established by each vessel position.

Authorized “Standard Education and Assessment” (SEA) trainers develop the path and guide the crew through their authorization process to ensure everyone is adequately trained and prepared for the duties required by their role. This is a Transport Canada requirement under the Marine Personnel Regulations of the Canada Shipping Act 2001 for all of our crews. Our crews will require authorization following requisite training and preparation before being given clearance to work on LNG-fuelled vessels. This is the same process as we would employ with any new ship joining the fleet.

BCSN: When the Salish-Class vessels are here – do shipyards in B.C. have the capabilities to work on LNG vessels for repairs?

ML: LNG-fuelled ships are not all that different from diesel ships so the conventional skills of the local yards will still be required. The ships will differ only in the fuel system which, in and of itself, is a relatively small and straight-forward system within the ship.

Most repairs specific to the LNG equipment which comprises the fuel system will be done by the original equipment manufacturer (Wärtsilä) or their certified service providers. As a result, there will be relatively little LNG work for shipyards to do since they don’t make the equipment. There may be some specialized pipework to be done over the life of the ships but this will be small and there are specialists that the yards can bring in to provide this service. The yards are preparing to handle LNG pipework. Virtually all other shipyard services required for the ships will be the same services they provide to our ships today.

Wärtsilä has a large service centre in Vancouver at which they are already

training personnel to service our vessels.

We anticipate they will be fully ready to support the Salish-Class upon arrival. In addition to local resources, Wärtsilä has a large global base of LNG-certified service engineers upon which to draw.

There is general industry training on marine LNG systems underway in B.C. The Industrial Marine Training and Applied Research Centre (IMTARC) in Esquimalt is supplying training courses in gas safety, LNG awareness and gas fuelling to a variety of ship repair companies. BCIT and Camosun College are also gearing up with a course for trades and ship’s crew.

In addition, the natural gas industry has a long history in B.C. and many experienced non-marine service providers exist. Companies such as Fortis (our fuel supplier for the Salish-Class vessels) and Westport have expertise which can be applied directly to many of our systems.

When LNG repair and maintenance services are required there is an ample base available in B.C. from the original equipment manufacturer, local shipyards and other experienced providers.

October 2015 BC Shipping News 27

ENERGY OPTIMIZATION Online tool for ship service energy optimization

By David Stocks

President, 3GA Marine Ltd.

O

>>> The amount of ship service energy generated by a ship varies, with the passenger vessel being one of the highest consumer types...

Background

implementation of optimization initiatives.

The application of this technology can extend to all ship types with larger and smaller ship service components; a cruise ship, for example, has a full hotel to maintain and their electrical load can reach several megawatts of power generated.

The standard cargo vessel, whilst having a smaller component of total energy use, still has a significant total consumption of ship service power, the majority of which is often used in port while handling cargo.

This research and development strategy involves the development of a marine version of a proven land-based application that will be adapted for ships, tested and validated on board coastal ferry service vessels.

3GA Marine Ltd. of Victoria B.C., along with their partners, ClearLead Consulting Ltd., have developed an online application specifically for the marine environment using the Panevo software “Energy Desktop” aimed at optimizing the ship service energy component of fuel usage.

This development is supported by the Transport Canada Clean Transportation Initiative and is in use by a coastal ferry operator. The objective of this tool is to: • Provide for an audit function of the consumers of ship service power; • Enable an optimization of those components from both a technological and operational perspective; and • Demonstrate the ongoing benefits to fuel consumption resulting from

Phase 3 Makes Progress

Photo: Istock

ptimizing a ship’s fuel usage is the number one priority for today’s ship owners to meet the economic and regulatory compliance demands on marine operations. The predominant demand on fuel is for propelling the vessel through the water and there are many new technologies and much research aimed at minimizing energy usage to achieve movement. But there is also a significant component of the fuel consumed for other purposes on board a ship — to maintain safety, facilitate personnel living, support the propelling functions of the machinery, and condition the cargo whether it be people or goods.

This component is referred to as the “ship service load” or “hotel load.” The amount of ship service energy generated varies, with the passenger vessel being one of the highest consumption types by virtue of its demand for heating and air conditioning, space lighting and domestic systems. A coastal ferry for example can consume up to 15 per cent of its fuel for purposes other than moving the ship.

3GA Marine’s Energy Desktop online application is providing ferry operators with the ability to significantly improve their ship service energy consumption.

28 BC Shipping News October 2015

Last year, 3GA Marine Ltd., Clearlead Consulting Ltd. and a local ferry operator reported to Canadian Ferry Operators Association Conference attendees on progress made on Phases 1 and 2, a vessel with a conventional ship service generator configuration. Moving into Phase 3 of this program, the partnership reports that: • The work on the fitting up of the sensing equipment to a vessel with a main engine shaft generator was completed; • The data is collected every 15 minutes to the Energy Desktop and detects trends and energy efficiency opportunities; • Vessel loading and temperature data has also been incorporated into the Energy Desktop. The ship’s Energy Efficiency Operational Index [EEOI]

ENERGY OPTIMIZATION is created on a daily basis, both for the ship’s design capacity and actual vehicle and passenger loads, the ship’s auxiliary engine, and for the ship as a whole; and • Energy and emissions reduction opportunities have been identified, assessed against capital equipment upgrades, loss avoidance measures, and performance against best practices.

The system described fuel savings which would reduce the auxiliary EEOI by approximately 29 per cent, the ship overall EEOI by approximately 2.7 per cent, and emissions by 871 tonnes of CO2 per year.

The Load Profile

In total, 24 separate assets have been metered on the Phase 3 test vessel. This includes both electricity from generators and all shore power to the vessel and identified critical consumers. Data is collected and stored on board through the ship LAN or within installed wireless devices and then transmitted to a secure server ashore. Using Energy Desktop, an electricity balance can be generated to determine the load profile.

Figure 1 illustrates that 63 per cent of the vessel’s generated electricity can be allocated to a discrete asset or area, which was previously identified as a potential area for savings. This data is recorded and stored in Energy Desktop and is available through the secure server to any authorized part of the company. In addition, other data elements, including fuel consumed on board the ship along with operational and environmental data from shore side sources, are added to the system such as: • Number of passengers; • Number of vehicles; • Nautical miles; • Sailing hours; • Daily weather data; • Heating degree days; • Cooling degree days; and • Average AIR temperature.

Energy and Emission Reduction

There are three categories of energy optimization strategies: • Engineering / capital equipment upgrades; • Loss avoidance measures [operational efficiencies]; and • Performing the best practice.

Energy Desktop’s regression/multivariate [MVR] analysis functionality can be used to establish “SMART” targets that can take into account base loads and

Figure 1: Hourly electricity balance stacked area graph

The system described fuel savings which would reduce the auxiliary EEOI by approximately 29 per cent, the ship overall EEOI by approximately 2.7 per cent, and emissions by 871 tonnes of CO2 per year. vary response based on influencing factors. In one example, cooling degree days were used to establish a “best practice” target for the air conditioning units.

Engineering capital upgrades for example can be assessed against projected reductions in electricity needs arising from such measures as introducing variable frequency drives to major motors, upgrades to heating ventilation and air conditions systems, and replacements of lighting systems with LED systems. The Energy Desktop analysis enables the operator to see the actual consumed energy and correlate it with operational and environmental variables

to access the real benefits of change and then monitor the improvement achieved.

Loss avoidance measures are identified by careful examination of the monitored consumed electricity. Where there are anomalies in usage or aspects of energy consumption that do not correlate with operational modes, modifications to operational practices can be implemented to avoid situations.

Likewise, the introduction of best practices can be examined with potential benefits established and costed before implementation. Following implementation, results can be reviewed — for example, simple procedures such as

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October 2015 BC Shipping News 29

ENERGY OPTIMIZATION reducing lighting in space not occupied and during day light times — and further examined.

Summary of reduction measures

• The metrics of the overall impact identified potential benefits of: • Annual electrical savings of 1,424,918 kWh/year; • Annual ultra-low sulphur diesel savings of 319,673 L/year; • GHG emission reduction of 871 t CO2/ year; • Reduction of ship service EEOI by 29 per cent; and • Reduction of the ship’s overall EEOI by 2.7 per cent

The Energy Desktop can be customized to each operator’s fleet and management system to replicate the form of the EEOI that the company uses. Estimated savings from the optimization measures and their impact on the EEOI can then be identified for the ship service systems and integrated into the overall EEOI for the ship. Those decisions investigated The Next Phase during the development exercise from The development program plans simithe Energy Desktop included: lar review works of energy generation on • Addition of ventilation recirculation – three types of vessels in this series of sea upgrade heat recovery; trials: • Upgrade of HVAC fan VFDs; • Phases 1 and 2 — Conventional diesel • Addition of VFDs to main engine supgenerator engine context; ply fans and engine room control fans; • Phase 3 — Main engine shaft • Installation of demand controls for generator; and ventilation on the car decks; • Phase 4 — Fully integrated central • Replacement of lighting systems with power plant diesel engines for propulLED fixtures; sion and ship services energy.

• Addition of VFDs to the main engine Each application includes: seawater pumps; and • Preliminary design audit under nor• Improvement to the seawater pump mal operating circumstances and BCSN Ferries Ad 2.qxp_Layout 1 8/31/15 10:14 AM Page 1 operation. assessment of the breakdown of

energy generation and consumption; • Selection of the required energy metres and data acquisition system; • Complete energy optimization system development using the Energy Desktop; and • Conclusions and recommendations to the ferry owner for energy savings and optimization.

This assignment will result in new best practices and a way to determine how best to extend and optimize the life cycle of ship auxiliary systems for operators and owners, and the SMART metrics with which to achieve the desired targets as expressed by the IMO. 3GA Marine Ltd. is pleased to play an integral role in this world-class, game-changing Clean Transportation Initiative.

Company co-founder and President David Stocks is a naval architect with over 40 years’ experience leading teams of experts in maritime and offshore vessel projects. He established 3GA Marine in 2012 in response to a need from the commercial marine sector in Canada and across the Pacific Rim for high-quality, responsive consulting services.

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30 BC Shipping News October 2015

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METHANOL Methanol-fuelled vessels are now a reality

W

ith the shipping industry continually facing greater environmental restrictions, new technologies, new fuels and new practices have been emerging at an accelerated pace — scrubbers, LNG, slow steaming, fuel cells, solar, wind, etc. For ship owners, the decision on which technology will be best for them can be daunting — it’s beta versus vhs all over again. Not to muddy the water further, but there’s another alternative fuel that is being recognized for its benefits — both to ship owners and the environment — and is increasingly being discussed as a viable option for marine fuel. As Jone Hognestad, President, Waterfront Shipping, outlined during a workshop focused on “Advances toward a low carbon economy,” methanol may actually have a stronger argument behind it than the current favourite, LNG.

Methanol basics

Quick chemistry lesson: Methanol is a simple alcohol compound, clear, colourless, and biodegradable, consisting of one carbon atom and three hydrogen atoms arranged as a methyl group (CH3), which is joined to an oxygen and a hydrogen atom in a hydroxyl group (OH), giving the chemical formula CH3OH (or CH40).

Traditionally, it has been used as a building block for other chemical industries to produce hundreds of everyday products — paints, pharmaceuticals, furniture, etc. Increasingly though (currently about 40 per cent), methanol is being used for energy applications — cooking fuel, biodiesel, fuel blending, fuel-additive and, most recently, the early stages as a marine fuel.

>>> Methanex has partnered with Carbon Recycling International (CRI) in Iceland to grow the use of renewable methanol and increase the availability of low carbon methanol from sustainable sources.

Methanol can be made from anything that is, or ever was, a plant. This includes common fossil fuels — like natural gas and coal — and renewable resources like biomass, landfill gas, and even power plant emissions and CO2 from the atmosphere. With its diversity of production feedstock and array of applications, it’s no wonder that methanol has been one of the world’s most widely used industrial chemicals since the 1800s.

Methanol is widely available in all major regions of the world. Worldwide, there are over 250 methanol plants with a combined production capacity of about 100 million tonnes. More than 180,000 tonnes is used every day. The global methanol industry generates US$36 billion in economic activity each year while creating over 100,000 jobs around the world. (source: Methanol Institute)

Vancouver-based leadership

With sales of over eight million tonnes annually, Vancouver-based Methanex Corporation is the world’s largest producer and supplier of methanol and poised to grow even more once the second phase of the plant in Geismar, Louisiana goes online. In addition to the six production sites in operation, Methanex has partnered with Carbon Recycling

International (CRI) in Iceland to grow the use of renewable methanol and increase the availability of low carbon methanol from sustainable sources. CRI has developed a technology that can produce methanol from CO2 captured from industrial power plant emissions. While they have been operating their plant successfully and selling product into the marketplace, a recent expansion has increased production capacity by 200 per cent to 4,000 tonnes annually.

Breaking new ground

“We sell eight and a half million tonnes of methanol per year,” said Hognestad, “so it’s natural that we would investigate the feasibility of methanol-run ships.” And that’s just what they’ve done. In 2013, Waterfront Shipping (WFS), the wholly owned subsidiary of Methanex and an important part of the methanol supply chain, signed an agreement with Mitsui O.S.K Lines, Ltd. (MOL), Westfal-Larsen Co A/S and Marinvest/Skagerack Invest to build seven new ships with flex-fuel engines that can run on methanol. These ships will have more efficient mechanical features, resulting in lower carbon dioxide and other emissions.

With its current fleet of 17 vessels (plus a small ice-class ship chartered in the

Waterfront Shipping will be the first in the world to bring seven flex fuel vessels into their fleet of tankers. The vessels will be capable of running methanol, fuel oil, marine diesel oil or gas oil.

October 2015 BC Shipping News 31

METHANOL winter months), WFS offers an extensive network throughout Asia, North America, Latin America, Europe and the Middle East, ensuring a global logistics flexibility that provides for timely and reliable delivery to customers. The new vessels will be used to add capacity as well as replace aging tankers (albeit, the average age of WFS’ fleet is less than nine years).

While not the first methanol-powered vessels to be put into service (that honour goes to Stena Line who, in January 2015, refit the Stena Germanica with methanol-modified four-stroke Wärtsilä engines approved and classed by Lloyd’s Register), these new ships will be the first built with MAN ME-LGI two-stroke flex fuel engines, capable of running on methanol, fuel oil, marine diesel oil or gas oil. In July of this year, MOL announced that the engine building has already been completed with tests confirming that the unit using methanol fuel has met expected performance. Seven vessels will be delivered in 2016 and will be added to Waterfront Shipping’s fleet under longterm charter. Three of the vessels will be owned by MOL, two jointly owned by Marinvest and Waterfront Shipping, and two owned by Westfal-Larsen.

“We believe that methanol is a real alternative to LNG,” said Hognestad. “One of the biggest benefits is that it’s already in liquid form and doesn’t require the temperature or pressure adjustments that LNG does. You just need a regular tank with supply coming directly from a shore tank, barge or ship-to-ship transfer.”

While Hognestad recognizes that the current global production of methanol would not be enough to supply mainstream use at this time, the argument for using it on ships operating within Emission Control Areas makes a lot of sense. There is more feedstock to produce methanol than existing bunker fuel, it just requires investments to be made to build the production capacity.

This was backed up by a 2013 presentation at the Interferry Conference in Malta from Stena RoRo CEO Per Westling who outlined the reasoning behind their decision to refit the Stena Germanica and further, to convert Stena’s entire ECA fleet by 2018 — 25 vessels in total. In addition to eliminating the need for cryogenic storage or pressure tanks, conversion of vessels to methanol is considerably less expensive than conversion to LNG while still attaining similar positive reductions in NOx, SOx and particulate matter. Methanol also has similar reductions as LNG in terms of greenhouse gases but without the associated methane slip. Westling also noted that methanol is not only a green, renewable source of energy, citing the Carbon Capture and Use technology like that Carbon Recycling International is using, but that with existing technology, more than enough can be produced to cover all of Stena Lines’ annual consumption.

The future

Much has been done over the last five years to advance research into the use of methanol as a marine fuel – and of course,

Located at Vancouver Waterfront and Roberts Bank

www.flyingangel.ca 32 BC Shipping News October 2015

Methanex and Waterfront Shipping have been in lead positions through much of it, including the SPIRETH research project which was behind the Stena Germanica conversion and the research projects that led to the new builds. Also recognizing the potential of methanol as a marine fuel and collaborating on the projects are companies such as Alfa Laval, who focused on the fuel conditioning systems for the seven new methanol flex-fuel vessels, and Haldor Topsoe, who developed a superior catalyst for synthesis of methanol.

Although LNG had a head start in the race to supply alternative marine fuels, the evolution of methanol as a viable option for the industry is starting to pick up steam. Where once there were only theories, research has now turned methanol-fuelled vessels into a reality and methanol as a marine fuel is proving to be more cost effective and more sustainable than LNG over the long run. (Noting that fuel costs are forever fluctuating, while methanol is currently priced higher, savings in conversion and infrastructure costs balance the overall investment.)

While only time will tell which fuel wins the race (more likely, the race will be won by a combination of new technologies and alternative fuels), one thing is certain: methanol-fuelled vessels are not only feasible but attractive to ship owners looking for cost efficient ways to comply with strict air emission regulations. In the meantime, all eyes will be on Waterfront Shipping as they put their new, methanol-fueled vessels into action.

INTERNATIONAL MARITIME CENTRE Vancouver

The best location for shipping operations Photo courtesy Graham Clarke

T

he federal Government of Canada and the Province of British Columbia have partnered with the International Ship-Owners Alliance of Canada (ISAC) to bring international shipping company operations to Vancouver.

The partnership efforts have re-established the Vancouver International Maritime Centre (VIMC) which will promote Vancouver to the international shipping industry as the preferred maritime centre location.

The B.C. government is contributing $1 million to re-vitalize the Vancouver IMC and diversify British Columbia’s economy. The province has committed to an additional $2 million over the next two years with all of the funding to be used by the non-profit Vancouver IMC for the development and execution of an investment attraction strategy aimed at strengthening the province’s shipping industry. The federal government has also committed $3 million over three years to match the funding from the Province of B.C., and ISAC will provide an additional $300,000.

“Under the leadership of Prime Minister Stephen Harper, our government has pursued the most ambitious trade agenda in Canada’s history,” said the Honourable Kerry-Lynne D. Findlay, Minister of National Revenue and Member of Parliament for Delta-Richmond East.

“Our investment will help the Vancouver International Maritime Center position itself as a global hub for worldwide international ship owners and promote the benefits of doing business in Canada.”

“An economy that is diversified through contributions from multiple sectors is our insurance policy during a time when the global economy remains fragile,” said Teresa Wat, Minister of International Trade and Minister Responsible for Asia Pacific Strategy and Multiculturalism.

“We have a re-invigorated local shipbuilding industry in the province, and now this new innovative partnership with the Vancouver International Maritime Centre will re-fuel the shipping sector so that its well-paying jobs can be offered to British Columbians.”

This initiative, to attract international shipping operational headquarters to Vancouver, capitalizes on Canada’s

Graham Clarke, CEO and Chairman, VIMC, Prime Minister Stephen Harper, and Kaity Arsoniadis-Stein, Executive Director, VIMC.

This initiative, to attract international shipping head offices to Vancouver, capitalizes on Canada’s opportunities as a Pacific Gateway and as a maritime province... opportunities as a Pacific Gateway and as a maritime province to create high-value knowledge jobs associated with global trade.

Expanded scope of Canada’s international shipping tax regime

Legislative changes to Canada’s Income Tax Act made on December 16, 2014, have expanded the application of Canada’s shipping tax legislation making Canada an extremely competitive location for the international shipping community.

Shipping activities have been redefined to include a broad range of corporate activities such as vessel management, finance, head and back office services. Simply put, foreign companies can manage their international shipping businesses from

Canada without their Canadian or foreign activities being subject to tax in Canada.

“Canada’s clearly defined and newly affirmed international shipping tax rules, coupled with Canada’s stable economic and political environment, provide fiscal certainty for ship owners,” says PwC International Tax Partner and Shipping Industry Leader Mike Shields. He adds, “These recent amendments strengthen Canada’s position as one of the most attractive tax regimes in the world for international shipping companies.”

Vancouver on the global stage for international business

Canada has been ranked the best country in the G-20 to do business, has the second highest standard of living in the

October 2015 BC Shipping News 33

INTERNATIONAL MARITIME CENTRE

This simple schematic of a common corporate structure highlights the benefits of locating a shipping company’s headquarters in Vancouver.

G-20 and leads all G-7 countries regarding economic growth, according to the World Bank. The World Economic Forum has declared its banking system to be the soundest in the world. Canada’s stable political environment, universal healthcare system, world-class universities, and high-tech capacity allow Vancouver to compete better than ever with business capitals around the world.

The opportunities in Vancouver are evident to companies such as Teekay and Seaspan, and to non-shipping giants that have come to Vancouver such as Microsoft, Google, Sony Pictures Imageworks, Amazon, Hootsuite, Mitsubishi and Toyota.

Commercial flexibility

In addition to international shipping tax incentives, shipping companies will be able to customize activities performed in Canada to meet their objectives with no tax consequences and minimal startup costs. They are able to establish operations in Canada or operate through a joint venture or partnership. Further, there are no vessel ownership or flagging requirements; no minimum commitments with respect to time, number of employees or spend in Canada; and there are no restrictions on whether the vessel is owned directly, indirectly or as part of a pooling arrangement.

About the Vancouver International Maritime Centre (VIMC)

34 BC Shipping News October 2015

Vancouver has become one of the most attractive locations for international shipping companies. The VIMC promotes Vancouver as a location for international

shipping companies, and assists interested companies in developing their operations on the west coast of North America.

“The volume of global seaborne trade is predicted to rise from nine billion metric tonnes per year to between 19-24 billion by 2030 due to the demand for resources

by China and India,” says VIMC Executive Director Kaity Arsoniadis-Stein.

“Vancouver, situated on the Pacific corridor, has exceptional professional corporate services, including taxation and legal, to support international shipping businesses. In addition, Vancouver can boast its very own Vancouver Maritime Arbitrators Association which is another added benefit to a maritime cluster.”

VIMC Founding Chairman, and current CEO and Chairman Graham Clarke adds, “By building a maritime hub that brings together products, companies and expert services, Canada will gain the advantage of the resulting relationships, synergies and high-level jobs creation”.

He further notes, “With an export dependent economy, Canada knows well that ship owners need to keep operating costs efficient in order to keep their services and their customers’ products competitive. We look forward to increasing the economies of scale by attracting more shipping companies to Vancouver. This will be good for both existing and new companies, as the talent pool expands.

The upscale jobs and skills that they will bring will be good for all Canadians.”

An official launch of VIMC is planned for Vancouver as well as international launches in London and Athens.

For more information, visit www.vancouverimc.org.

CLASS SOCIETIES

Maximizing growth and profit through LRQA

By Beth Mitchell

LRQA Senior Marketing Specialist

A

ny CEO will tell you that they want to maximize profits while growing their business. Lloyd’s Register (LR) and its business assurance and management systems division, LRQA (Lloyd’s Register Quality Assurance), offer technical expertise to support global companies looking to improve their systems in a strategic, methodical way so that they maintain their competitive advantage while improving the way in which their business is conducted.

LR started as the world’s first ship Classification Society (established in 1760 in London, United Kingdom) but its global reach is substantial today. In Western Canada, Lloyd’s Register and LRQA assist marine businesses with a wide variety of services.

ISO 9001 and ISO 14001

LRQA enables companies to maximize their profits through its world leading, independent business assurance services including management system certification, validation, verification and training to customized and international standards and schemes. LRQA can help a company obtain International Organization

In addition to certification services, LRQA also offers training to help companies transition to current and recently revised standards. for Standardization (ISO) certifications, training, customized and second party assurance.

In addition to certification services, LRQA also offers training to help companies transition to current and recently revised standards. LRQA can help companies with these standards to increase performance and reduce overall risk at all stages of the management systems journey.

ISO 9001 quality management systems standards (QMS) help organizations ensure that they meet the needs of customers and other stakeholders while also meeting statutory and regulatory requirements related to a product, service or asset. ISO 14001 sets the criteria for an effective framework for an Environmental Management System (EMS), focused on minimizing a company’s impact on the environment

while complying with applicable laws, regulations and other environmental requirements.

It is not uncommon for marine industry stakeholders to require their suppliers to hold ISO certifications. These standards focus on how a product is produced, or asset managed rather than the product or asset itself and are oriented towards continually improving operations.

Some of the biggest changes to the recently published ISO 140001:2015 were in organizational context and sustainability-related areas. Under the revised standard, marine companies must now take a lifecycle perspective as well as a compliance-based approach to areas like air, water and waste. “The focus is on environmental cost and environmental impacts both within and outside the fence-line.

Sustainability is seen more as a strategic business management effort rightly

Photo: BC Shipping News

Achieving certification from LLoyd’s Register Quality Assurance (LRQA) provides confidence for customers dealing with companies like Seaspan ULC and Saam Smit.

October 2015 BC Shipping News 35

CLASS SOCIETIES owned by the top leadership team and its employees,” said Bob Clifford, LRQA technical manager for Client Training Services and an EMS lead assessor.

Marine companies should focus on sustainable development under the revised standard and look at their products and services from the beginning to the end of its lifecycle. “Businesses need to be focused on how their footprint impacts the broader, global environment we all share,” added Clifford.

Designing marine vessels and support vessels to be more recyclable, energy

efficient and sustainable is crucial for businesses to be more competitive.

“Lifecycle thinking means starting at the inception stage of a ship or structure and incorporating environmentally sound materials and manufacturing processes at the beginning to eliminate bad ones,” said Gary Cottrell, an LRQA technical manager for EMS. Ships need to be compliant, efficient and cost-effective and meet the expectations of stakeholders. LR can help clients optimize energy efficiency at the design stage to achieve compliance and

energy savings in service. “You need to know that your new ship will be ‘future proof.’ It will need to comply with future environmental regulations, operate efficiently and cost-effectively, and meet the expectations of your stakeholders,” said Cottrell.

Marine companies can work with LRQA to formulate their transition plan to ISO 14001:2015 through a gap analysis that will tell them where they currently are in relation to the new requirements and what steps need to be taken next. LRQA can also help identify any training needs that are necessary for the organization.

Other LRQA Services

36 BC Shipping News October 2015

In addition to providing certification and training services for ISO 9001 and 14001, LRQA also offers ISO 20000-1 certification for information technology (IT) service management, ISO/IEC 27001 information security, ISO 28000 supply chain security, ISO 22301 business continuity, and OHSAS 18001, Occupational Health and Safety. In addition to the marine industry, LRQA supports a wide variety of certification standards in the food, medical, manufacturing and energy industries.

The global challenge of climate change is making Greenhouse Gas (GHG) inventories a necessary part of transparent business communication. LRQA’s expertise in the carbon market positions us to verify a company’s carbon footprint against ISO 14064, the GHG protocol, the California Climate Action Registry (CCAR), The Climate Registry (TCR) and the Japan Carbon Footprint of Products Scheme (JCFP). LRQA provides this service to marine industry client’s Carnival Corporation & plc and Royal Caribbean Cruises Ltd. Second party assurance comes in the form of customized audit programs using a company’s internal standards throughout their supply chain. Why wouldn’t a company want to know if its supply chain or fuel program is optimized in a way where their suppliers adhere to their own internal quality standards? How do they know their suppliers are meeting or exceeding standards?

An audit program allows a business to better address issues with a poor performing supplier and helps customers better know what they’ve bought.

LRQA can help customers go above the required marine industry standards to achieve best practice in their respective field. It is good to benchmark your

CLASS SOCIETIES practices and to know where improvements can be made to model the best practices. LRQA can help a company improve their processes in a measureable, calculated way.

The Next Steps

Like every industry, there are statutory required certifications that relate to the management of marine companies in the environmental area. The International Safety Management (ISM) code requires the safe management of companies and ships, and compliance with the code is mandatory for merchant vessels above a certain size that trade internationally. “Ship managers must be certified to the ISM code, which provides assurance that they are managing their ships in a safe manner while also protecting property and the environment,” said Delton Friedman, who has worked extensively as an auditor for LRQA in the Marine Management Systems office.

LRQA recognizes the large overlap between the requirements of the ISM code and voluntary requirements of ISO 14001. “We do combined audits that are helpful to companies. There is quite a big demand for marine clients where they must have the ISM certification, but also want the voluntary ISO 14001 audit at the same time,” said Friedman.

By getting the ISO 14001 at the same time as their ISM code audit, the company is demonstrating an extra level of commitment to safeguard the environment. Canada also has rigorous environmental laws for the marine industry.

“There are impacts to the environment from the shipping industry and doing the minimum will allow one to get by.

But by going further and getting the ISO 14001 certification, marine companies can demonstrate to the public and their stakeholders that they are doing everything in an environmentally responsive manner.”

The LR office in Vancouver provides ISO 9001 and 14001, OHSAS 18001, or a combination of these quality assurance services (including ISM) to the following local ship owners, shipyards and designers: Saam-Smit; Seaspan Marine; Island Tug & Barge; Pacific Pilotage Authority; North Arm Transportation; Deas Pacific Marine; Seaspan Shipyards; Allied Shipbuilders; Meridian Marine; VARD; and Robert Allan Ltd. In addition, the LR Vancouver office provides a wide variety of marine support for different clients. The office

supports clients with European directives such as: • ATEX — PII Pipelines (for pipeline integrity services); • Marine Equipment Directive (MED) — Zodiac rescue boats, Mustang survival suits and life jackets, Current Scientific night vision equipment; and • Pressure Equipment Directive (PED) — Highland Foundry Ltd.

For companies interested in LRQA or any other LR Energy or Marine services, please contact the North Vancouver British Columbia office at 604-985-0477 or vancouver@lr.org.

The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions, position, or policy of Lloyd’s Register or its employees and affiliates.

maritime and commercial law on canada’s west coast Nevin Fishman Mark W. Hilton Katherine A. Arnold James Vander Woude

W. Gary Wharton David K. Jones Connie Risi Joanna R. Dawson

Peter Swanson Catherine A. Hofmann David S. Jarrett Megan Nicholls

Thomas S. Hawkins Tom Beasley Russell Robertson

associate counsel: Lorna Pawluk tel: 604.681.1700 fax: 604.681.1788 emergency response: 604.681.1700 address: 1500–570 Granville Street, Vancouver, BC, Canada, V6C 3P1 web: www.bernardllp.ca

October 2015 BC Shipping News 37

INTERNATIONAL SHIPPING

Photo by Dave Roels, www.daveroels.com

W

ith the opening of the expanded Panama Canal only months away (see sidebar on new developments in this regard), there are signs that its impact on West Coast North American ports may be harsher than first thought.

The 80-kilometre canal, which is over 100 years old, is seeing its largest expansion since opening day back in 1914, and the addition of a third lane will more than double the container capacity from 5,000 to 13,000 TEUs (20-foot equivalent units).

The expanded canal is the site for one maritime battle underway — the scrap for future business between United States West Coast and East Coast ports — but there’s another in the form of the head-to-head fight for business between the Panama Canal and the recently expanded Suez Canal.

In early August, the Suez Canal, which handles about eight per cent of the world’s cargo now, opened an $8 billion second lane, celebrating the biggest expansion since it first opened in 1869. Egypt’s bold decision to create another lane (actually a new 35-kilometre channel), for the 193-kilometre link between the Red Sea and the Mediterranean, is an attempt to win back business and stem falling cargo totals, which have seen the number of vessels using the shortcut remain 20 per cent below its pre-recession 2008 level and just two per cent higher than a decade ago.

And that’s pretty much why Panama decided to increase the capacity of its canal, sometimes described as the greatest shortcut in the world.

To say there have been choppy waters since the US$5.25 billion Panama Canal Expansion Project began back in September 2007 may be an

38 BC Shipping News October 2015

Panama Canal expansion impact may be greater than first thought

By Ray Dykes

...a recent White Paper...predicts that up to 10 per cent of container traffic to the United States from East Asia could shift to East Coast ports from West Coast ports by 2020. understatement — there have been agonizing moments from project-hampering disputes with contractors to threatened strikes, the latest in mid-August was averted as workers were promised more pay by the GUPC (Grupo Unidos por el Canal, SA) consortium made up of the Spanish builder Sacyr, Italy’s Salini Impregilo, Belgium’s Jan De Nul, and Panama’s Constructor Urbana.

The expansion project involves installing a third set of locks, creating a Pacific access channel, improving existing navigation channels by dredging, and improving water supply. It comes after more than 100 studies on the economic feasibility, market demand, environmental impact,

and other technical engineering aspects.

There was even a referendum, which gave healthy support from the people of Panama for the expansion project.

In its own words, the Panama Canal Authority (ACP), which earns almost $2 billion a year in canal tolls, says the main objective of the expansion program is to increase capacity to meet demand growth with enhanced customer service.

“The expansion will double the canal’s capacity, having a direct impact on economies of scale and international maritime trade,” an ACP spokesperson says. “It will help maintain the canal’s competitiveness and the value of the maritime route through Panama.”

Oops, leaky lock could stall opening

A

video of water pouring through a supposed solid concrete lock on the Pacific side of the Panama Canal expansion could imperil the opening in April 2016.

But, so far the Panama Canal Authority (ACP) is not among the “sky is falling” group and insists the crack and subsequent leaks in a step or sill of the Cocoli Locks “should not impact” the completion timeline for the locks. The news of the leaky lock came during operational testing which is meant to detect and correct any imperfection the authority said.

And the ACP is holding the contractor for the third set of locks — Grupo Unidos por el Canal, S.A. — responsible for repairs and says it is working with Grupo to resolve the issue.

“At this time and based on preliminary evaluations, the project’s completion timeline as well as the expected date for commercial operation are not expected to change,” the ACP statement said.

Overall, the canal expansion is over 90 per cent complete.

Neither the ACP or Grupos have said what sort of repairs will be required to fix the leaks and there are still many doubters that the bad news won’t impact the strict deadline for the expansion opening.

INTERNATIONAL SHIPPING The existing Panama Canal already handled six per cent of global maritime trade and 10 per cent of all United States shipping in 2014. In overall cargo terms, almost 225 million tonnes used the canal in 2014 and that was a 7.1 per cent increase over 2013 volumes. The U.S. is both the Number One origin of those cargoes and the Number One destination at over 154 million tonnes.

Figuring out what the expansion will mean to West Coast ports hasn’t been easy and the usual response is that ports such as Long Beach and Los Angeles are forming new alliances and taking measures to ensure their competitiveness, with emphasis on improving transit times, shipping channels and the smooth co-ordination of existing and future rail traffic. Labour disputes and costly delays have sullied the reputation of these two shipping giants in recent years.

But, a recent White Paper study entitled “Wide Open — How the Panama Canal expansions is redrawing the logistics map” predicts that up to 10 per cent of container traffic to the United States from East Asia could shift to East Coast

ports from West Coast ports by 2020.

The paper, authored by The Boston Consulting Group (BCG), reputed to be “the world’s leading advisor on business strategy,” and global supply chain experts C.H. Robinson, says West Coast ports will still handle more traffic than they do today, “but their market share will likely fall.”

The White Paper says the expansion opening next spring will be the “headline event of 2016” in the marine world and adds it promises to “reorient the landscape of the logistics industry and alter the decision-making calculus of the shipping that the canal serves.”

To a simple shipping writer like me that sounds ominous enough, especially when the current situation is considered — do shippers want fast or cheap? Pick one.

The East Coast ports will bring savings in fuel, crew, and insurance costs on routes to the U.S. Mid-West and there has been a frenzy of infrastructure improvements in several ports to allow them to handle the larger vessels soon to use the Panama Canal. The work has involved harbour dredging, channel widening, new

jumbo cranes to handle Post-Panamaxsized vessels, plus a variety of landside developments. Unfortunately, all of these expensive improvements could turn sour, one shipping expert warns, if there are unforeseen headwinds or the U.S. economy weakens.

And that must bring sobering moments to the Port of Savannah, which is investing over $1.4 billion, and the Port of Miami with its $2 billion in infrastructure improvements. Looking to the West, the Wall Street Journal recently postured that smaller ports such as the Port of Portland “face the prospect of falling off the map entirely.” Portland lost its last major shipping line back in March leaving the port without ocean-bound container services for the first time in 40 years.

For British Columbia ports, there appears to be no need to sound the alarm bells and infrastructure improvements in Port Metro Vancouver and the Port of Prince Rupert continue unbridled by fears of what might happen in Panama.

However, for some U.S. West Coast ports, the White Paper has proved to be a sobering glimpse into just what might

Securing a bright future Westshore Terminals – North America’s busiest coal export terminal – is amid a five-year, $270 million project to make it even better.

As we work to secure a bright future over the next few years we will:

• Build a new office, workshop and employee complex

• Replace three of our four stacker-reclaimers

which both stockpile and reclaim coal on our site

• Replace our largest shiploader at Berth 1 • Install additional dust suppression systems For our customers it will mean they can plan for the future with confidence. We will have new equipment and increased coal stockpile capacity without increasing our site footprint.

Every tonne of coal from train to vessel will be handled more efficiently and with improved environmental safeguards.

The changes will not come without challenges as we are a busy terminal. However, the results will prove worthwhile for Westshore and its unitholders; to our customers; and to Canada in increasing coal export revenues, and productive jobs.

www.westshore. com

We’re taking time to do it right October 2015 BC Shipping News 39

INTERNATIONAL SHIPPING

Photos courtesy Panama Canal Authority

In progress...the expanded Panama Canal is being touted as a “game changer” for supply chains.

Celebrating another milestone, workers at the Panama Canal cheer the filling of one of the locks.

lie ahead. Doing nothing has never been an option for the likes of the Ports of Los Angeles and Long Beach. The study confirms that the West Coast will “always be the fastest option for reaching much of the United States” but it also warns that the “East Coast will become the least costly option for many shippers.”

And we haven’t even talked yet of another ominous threat on the maritime horizon if you are looking through the eyes of the Panama Canal Authority. The advent of a new shortcut known as the Nicaragua Grand Canal also has heads spinning, not the least among the Panama leaders.

No wonder the Panama Canal Authority is already talking of yet another expansion as it nears the opening of the current one. This even more ambitious project will cost $17 billion and would allow the canal to handle the world’s largest container ships and battle the Suez Canal head on. Studies are reportedly already underway.

40 BC Shipping News October 2015

But, what if the Nicaragua Canal project goes ahead? A US$50-billion contract from the Nicaragua Government has been awarded to Chinese businessman Wang Jing and his HKND Group, a privately-held international infrastructure firm headquartered in Hong Kong. Financing is said to be coming from Jing and investors in Europe, Asia and North America.

Jing has been given a 50-year concession to build and run a 278-kilometrelong canal from Peurto Brito on the Pacific Ocean through Lake Nicaragua and over to Puerto Aguila on the Atlantic Ocean.

While there was no consultation (unlike the referendum in Panama for the expansion project) and little public input of any kind in the decision to go ahead, a compelling case is being built for the canal in a country where 43 per cent of the population lives below the poverty line.

“This project is an important way for Nicaragua to grow its economy, generate

jobs, reduce poverty and raise our competitiveness,” says Telemaco Talavera, chief spokesman for the Nicaraguan Canal Authority.

A canal across Nicaragua has been the dream of kings and entrepreneurs for centuries and the current government sees the project as a desperately needed economic boost to a country reputedly the poorest in the Western Hemisphere except for Haiti. Nicaraguan President Daniel Ortega sees the canal as a positive not only for the country, but for all of Central America, offering 50,000 jobs during construction and 200,000 jobs once it is operational.

The canal, if built will be able to handle much larger ships than the expanded Panama Canal including container vessels up to 25,000 TEUs and bulkers up to Capesize around 180,000 deadweight tonnes, including a new generation of oil tankers.

Despite protests, a groundbreaking ceremony was held late last year on a road heading toward the project. Actual construction is due to start by the end of this year at both ends of the canal and some say it will be completed as early as 2019, but there are doubters who call the project “a risk beyond reason.”

Opponents have been numerous, including indigenous tribal groups and farmers whose land will be expropriated without appeal. At one stage there had been about 50 protests from residents, land owners and environmentalists concerned over the impact of the canal and its large ships and the dredging of a 90-footdeep shipping channel. They also worry about pollution from large ships and over what possible salt water contamination could do to Lake Nicaragua — Central America’s largest freshwater lake.

Some conspiracy theorists see it as a sellout to the Chinese and go as far as suggesting the project is nothing more than a Chinese plot to give its naval vessels much easier access to waters around the United States, although Jing has denied his government is involved.

Separated from Panama only by Costa Rica — which is reported to be against the project — Nicaragua is forging ahead with its rival canal. Stay tuned for the next exciting episode in what could be the largest earth moving operation in world history, or not.

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

INTERNATIONAL SHIPPING

Eastward past the Spratly Islands

By Syd Heal

T

In terms of ever reaching a workable settlement of competing claims, it seems as though a solution is a very long way off.

Once past the Natuna Islands, our coastal route paralleled the north coast of what was Sarawak with its interesting Vyner Brooke family who claimed it as a personal estate and then quite soon we were off Sabah, the part of Borneo that is Malaysian, and took us towards our first port of call, the small island of Labuan which was still a separate British colony.

On the passage along the Borneo coast it was fairly devoid of navigational hazards, but over to port, the chart indicated a vast area that was virtually unknown to shipping of that era. A long, dotted line encircled a huge expanse of the South China Sea. It was notable by being mostly devoid of soundings and carried the warning to seafarers without local knowledge,

Source: Google Earth

he Spratly Islands in the South China Sea have held a fascination for me ever since I came so close to seeing them while undertaking a voyage from Singapore to Hong Kong following the ‘Slow Steamer Passage, recommended in the Typhoon Season,’ as marked on the charts of that time.

This was back in early 1946 and our slow steamers at that time were four LCTs, more familiarly known to the public as tank landing craft. The four ships were diesel propelled and were of the MK IV design with a length of 187.25 feet and a breadth of 38.33 feet. Despite extreme shallow draft, with 3.10 feet forward and 4.25 feet aft, they were nevertheless quite good sea boats that had sailed in convoys from the U.K. after the Normandy landings under their own power to delivery points in India, ready for the invasions to the East as the Japanese wartime empire crumbled.

With our repairs complete, the four landing craft were under orders to sail at 0800 hours. We formed up in line in Johore Strait as we sailed to meet our escort, the frigate, HMS Veryan Bay who sent a general signal using a masthead light giving us our course as we proceeded with the frigate about 500 yards away on a parallel course where she could keep an eye on all four of her charges. Our course was set for the western-most tip of Borneo where a sliver of Indonesian territory came up the southwest coast to create an area of Indonesian waters that thrust like a blunt knife into waters recognized on both sides as Malaysian and pointing in the general direction of Cambodia. As it turned out, this section of Indonesian water covered a valuable gas field that took its name from the Natuna Islands, becoming the only territorial claim of Indonesia at the southwestern extremity of the South China Sea.

to stay outside of the dotted line. It covered an area of many tens of thousands of square kilometres. The charts for the South China Sea noted that mariners should be aware that the entire area was full of several hundred atolls, submerged reefs, banks, shoals, cays and islands. The position of many could not be guaranteed and undoubtedly many remained to be found with a firm established position.

Some of the atolls had been named and many looked very much like they carried the names of ships that had strayed into the area and probably made their discoveries by accident, perhaps with serious results in some cases. Some names are Barque Canada Reef, Ardesier Reefs, Investigator shoal, Alicia Annie Reef,

Itu Aba Island, as seen from Google Earth, where Taiwan has built an airstrip — one of the many disputed islands within the Spratly Islands chain.

October 2015 BC Shipping News 41

INTERNATIONAL SHIPPING London Reef, Lansdowne Reef and Fiery Cross Reef. The last named is now the site of extensive Chinese development despite Vietnam’s claim.

Some islands carried personal names of Western people for the most part and one of them is Spratly Island which carries the name of its discoverer, a 19th-century British sea captain. Evidently, it was the first to be discovered and the name seems to have been adapted to cover the entire area inclusive of everything in a vast region.

For serious researchers, there is a lot of information on the Spratlys to be found on the internet and Google Earth reveals many islands both natural and artificial.

One of the most revealing is Swallow Reef, originally a coral and rock formation surrounding a lagoon. I believe the reef was all but fully submerged at high tide, but since being claimed by Malaysia it has undergone a transformation that must be typical of the holdings of some of the other nations claiming an area of the Spratlys.

In the case of Swallow Reef it has been built up into a man-made island with a long well-constructed and surfaced airstrip

big enough to look like a large stranded aircraft carrier. There is a permanent military garrison there, although it does not appear to be particularly secretive in a military sense as it also allegedly functions as a resort for snorkellers.

One thing that is striking are the logistical considerations involved in bringing in everything required for construction, including all materials and equipment, from fresh water for crew needs and construction, to cement, steel piling and all manner of supplies. Cutting two channels through the coral reef to give access to the lagoon provided an initial source of fill. Additional material was probably dredged off the ocean floor and armour rock and topsoil were possibly barged in from Sabah. In an aerial view of Swallow, it can be seen how construction likely proceeded in stages with a small circular island being first created by erecting steel sheet piling and then infilling with debris from the canal dredging operation to give the project its start. Once built, the circular island gave the builders the room they needed to build outwards and thus create the airstrip and space for ancillary buildings and an unloading facility for

The Spratly Islands — a source of great contention as no less than five (six, including Brunei) have laid claim to the valuable resources of the area.

42 BC Shipping News October 2015

barges that can be seen at anchor inside the lagoon.

After a call at Labuan we were instructed to cross the Gulf of Brunei and sail up the Brunei River for several miles to a logging camp operated by the Australian Army, to load casuarina wood for fuel-starved Hong Kong. The Mk IV LCT had a rated deadweight capacity of 350 tons under battle conditions. As a freighter with a self-draining gate, which was never meant to be watertight, we could safely load about 500 tons, which was the tonnage loaded for delivery at Hong Kong.

We left the Gulf of Brunei with our cargoes and met our escort outside Labuan as we regained the slow steamer passage which took us past the Philippine island of Palawan until, from our easterly course we gradually veered to a northerly course until we came abreast of central Luzon where the Lingayan Gulf lay about due east of us. Here we did a sharp course change as we went over to a northwesterly heading which took us directly into Hong Kong. We saw some tiny atolls that looked like palm trees floating in the water that were part of the Scarborough

INTERNATIONAL SHIPPING shoals. We never caught site of the Spratly Islands in all their vastness, because they all had a very low profile at a maximum of around six feet and our bridge was only about 18 feet above water at eye level. The plodding boredom while crossing from the Philippines to Hong Kong, in the first rough weather we had seen on this trip, was relieved by a sight of the Pratas reefs which surrounded Pratas island, now occupied by Taiwan.

What is also interesting was the fact that this large area of ocean should have been largely ignored for so long, considering the intensive commerce between the heavily populated countries that surround the South China Sea. Much has changed of course over the 70 years since I sailed the region. In those days, the colonial powers in the area, aside from the British, were the French, Dutch and the U.S. with a tiny Portuguese presence at Macao, but since the end of the Second World War, the colonials have been replaced by nationalist interests and all the countries that were colonies have become independent countries usually with a strong awareness of the need to protect their own interests.

The area covered by the Spratlys and adjoining islands that share the same underwater and topographical features is a vast underwater tableland of varying depth of volcanic origin overlain by the usual corals. Even though it was no place for vessels without intrinsic local knowledge, there is little doubt that fishermen from the neighbouring countries had penetrated its waters, probably for centuries, as rich fishing grounds abounded there. When we were in the slow steamer passage, particularly when abreast of Palawan, we came across fishermen in hollowed out canoes and an outrigger with a small sail to help them along. Well out of sight of land, they were probably navigating by instinct alone and perhaps coming from the area claimed by the Philippines, heading home to Palawan.

During the war, the Japanese had a submarine base on Itu Aba, the largest of the Spratly islands with an area of 47 hectares. At the end of the war, Japan surrendered the island and a smaller drying reef nearby to the Chinese Nationalist government under Chiang Kai-Shek and it is based on that event that Taiwan claims sovereignty of this territory. Today, it is well covered with palms, mangroves and shrubs. It also maintains a 600-man garrison, lighthouse, radio and weather station and a concrete wharf. It has something which is probably pretty rare with two wells and a reliable fresh water supply. In 1993, Taiwan announced plans for an airstrip and from an examination via Google Earth it appears to have been built since then as an earthen strip.

In terms of ever reaching a workable settlement of competing claims, it seems as though a solution is a very long way off. Two powers, Malaysia and Brunei have claims to contiguous waters that appear strong with less likelihood of serious impaction on anyone else’s claims. The Philippines are unshakeable in their claims to a vastly larger area than Malaysia or Brunei, but again if there is ever an equitable division, the Filipino claim to what it occupies in the easterly sector that is contiguous to Palawan and Luzon seems reasonable.

The big bad boy in this play to grab everything is China. It claims everything in the South China Sea including all the Spratlys and right up to all its neighbours internationally recognized offshore economic zones. This is a claim which, if ever sustained, would turn the South China Sea into a Chinese lake and set a precedent for similar incursions elsewhere. Vietnam makes a similar claim, but obviously with far lower expectations. More likely it is more a matter of checkmating the Chinese claim. The Chinese know there would be widespread opposition from most of the rest of

the world with any kind of a stake in international waters and it is probably relying on its military might to back up a grab for as much as it can get by peaceful means.

China’s tactics are to stake as many claims as it can. The Spratlys are the key to it all, but there are also the Paracel group that is closer to mainland China and Vietnam and sundry other reefs, shoals and atolls outside of both areas but still in the China Sea. Tensions are running high following Chinese seizure of the shoals with their tiny islets in 2012. The Paracels were seized by China from Vietnam when the latter country was just recovering from its long civil war. That invasion still rankles with Vietnam, which with good reason is suspicious of every move made by the Chinese and the two countries’ claims are as mixed as a well-shuffled pack of cards in the section were the islands are most packed. There have been naval engagements between Vietnam and Chinese warships and the Philippines navy is forever watchful of any Chinese encroachment on its claimed area. Further north, tensions run high with Japan as China is adopting a bellicose attitude in regard to Japanese islands that lie close to China.

Small garrisons guard many of the islands in what must be spartan conditions. One event was the occasion when a Vietnamese garrison travelled to a nearby island to attend the birthday of their commandant. While they were away so briefly, a Chinese invasion was mounted so that when the Vietnamese garrison returned from what was a good party, they found the interlopers in possession. The source did not explain how the matter was settled or in whose favour!

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

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

Jane McIvor, Publisher BC Shipping News

October 2015 BC Shipping News 43

LEGAL AFFAIRS Wreck removal

Implementing the International Convention on the Removal of Wrecks, 2007

By David K. Jones

A Vancouver Lawyer with Bernard LLP

T

>>> Wreck removal can be very costly and potentially dangerous because of the practical difficulties associated with removing a wrecked vessel and any hazardous substances that may remain on board.

The current Canadian legislation relating to wrecked or derelict vessels includes Part 7 of the Canada Shipping Act, 2001, titled “Wreck”, which defines wreck to include “jetsam [something thrown overboard], flotsam [wreckage of a ship floating or washed up on shore], lagan [goods or wreckage lying on the ocean floor] and derelict [abandoned vessel] and any other thing that was part of or was on a vessel wrecked, stranded or in distress,” and aircraft wrecked in waters. The Act includes provisions for persons finding a wreck to report it to the receiver of wrecks, and for the Minister of Transport to release or dispose of the wreck, and to determine a

Photo: Istock

he dramatic and very costly parbuckling, refloating and removal of the wreck of the cruise ship Costa Concordia from its partially submerged position in an environmentally sensitive coastal area off the Italian island of Giglio focused the world’s attention on wreck removal in 2014.

Less dramatic, but of significance to many local coastal communities, is what can be done with a derelict vessel tied up to a wharf, grounded on a beach, or submerged. Wreck removal can be very costly and potentially dangerous because of the practical difficulties associated with removing a wrecked vessel and any hazardous substances that may remain on board.

This article reviews the current Canadian legislation relating to wrecks, and Canada’s proposals to improve the legislative regime dealing with wrecked and derelict vessels, including legislation implementing provisions of the International Convention on the Removal of Wrecks, 2007 (Wreck Convention).

The issue of derelict vessels on the West Coast has been a source of great frustration for coastal communities.

44 BC Shipping News October 2015

salvage award, if any, to a person who has found the wreck.

Also, the Navigable Protection Act, sections 15 – 20, require a person in charge of an obstruction in navigable water to give notice of the obstruction to the Minister of Transport, and to mark and light the obstruction. The person in charge of the obstruction is required to immediately remove the obstruction, failing which the Minister may remove or destroy the obstruction. The Minister is also granted the power to sell the obstruction, and any removal costs may be recovered from the proceeds of sale, or from the person in charge of the obstruction, or who was at fault for the obstruction. If a vessel has been left anchored, moored or adrift in any navigable water and obstructs or is likely to obstruct navigation, the Minister may order the registered owner or other owner, managing owner, master, person in charge of the vessel or subsequent purchaser to secure it or remove it to a place the Minister considers appropriate.

Transport Canada has recently released a Discussion Paper titled “Proposed Canadian Legislative Regime For the Remediation of Hazards Related to Shipwrecks.” The Discussion Paper refers to limitations on cost recovery in the existing legislation, and cases where the Canadian taxpayer has borne the costs of wreck removal where an owner of a wrecked vessel has become insolvent or cannot be found. Another Transport

LEGAL AFFAIRS Canada publication titled “Study of the extent of abandoned and derelict vessels in Canada,” dated November 2012, reports on a survey conducted

by Transport Canada identifying 397 abandoned or derelict vessels across the country.

The Discussion Paper suggests that new Canadian legislation based on the Wreck Convention could address several of the limitations in Canada’s present legislation, specifically “by establishing a regime of strict liability and compulsory insurance on ship owners for the remediation of a much broader range of hazards related to shipwrecks.”

The Wreck Convention came into force for state parties to the Convention on April 14, 2015, but Canada is not a party to the Convention.

The Wreck Convention applies to seagoing vessels, and the area covered by the Convention is a state’s exclusive economic zone (the area extending from the outer limit of the 12 mile territorial sea to 200 miles seaward measured from the coastal baseline).

The Discussion Paper includes consideration of whether Canada should implement legislation that would extend the application of the Wreck Convention to encompass the area of Canada’s territorial sea and internal waters, and to a much greater number of vessels that are non-seagoing, for example, the Great Lakes fleet, smaller coastal commercial vessels including the tug and tow fleet, and pleasure craft.

Regarding the proposed extension to internal waters and the territorial sea, the considerations include the fact that many wrecks occur within the territorial sea, and there are a large number of vessels and vast areas of Canadian waters that are not included in the existing area covered by the Wreck Convention — the exclusive economic zone.

One of the key aspects of the proposed legislation is the authority for government to take action for the removal or remediation of a wreck only if it is determined that the wreck poses a hazard and the owner fails to take appropriate action.

“Hazard” is broadly defined in the Wreck Convention to mean any condition or threat that: “(a) poses a danger or impediment to navigation; or (b) may reasonably be expected to result in major harmful consequences to the marine environment, or damage to the coastline or related interests of one or more States.”

The term “related interests” is defined to mean “the interests of a coastal State directly affected or threatened by a wreck such as: • maritime, coastal port and estuarine activities, including fisheries activities, constituting an essential means of livelihood of the persons concerned; • tourist attractions and other economic interests of the area concerned; • the health of the coastal population and the wellbeing of the area concerned, including conservation of marine living resources and of wildlife; and • offshore and underwater infrastructure.”

The imposition of strict liability on a ship owner is significant in requiring the ship owner to pay for the costs of locating, marking and removing the wreck, regardless of fault. Limited defences include the wreck having occurred due to war or a natural phenomenon of an exceptional, inevitable and irresistible character; or the act or omission of a third party done with intent to cause damage; or the negligence of any government responsible for the maintenance of lights or other navigational aids.

Strict liability and compulsory insurance issues, as they may uniquely relate to the tug and tow industry, are identified in the Discussion Paper and have raised concerns, for example: if the towed vessel is not a ship does the Convention apply to the tow; there may be difficulty in identifying the owner of the tow or holding the owner liable; the allocation of risk between tug and tow is not always clear;

and imposing on the tug an obligation to ensure the tow has insurance may not be practically feasible in many towage scenarios.

Another potentially controversial issue reviewed in the Discussion Paper is the potential application of the legislation to commercial vessels and pleasure craft less than 300 gross tonnage. The Discussion Paper states that before the proposed legislation is made applicable to small vessels further consultation with stakeholders will be necessary to consider issues specific to small vessels and compulsory insurance, for example, how the compulsory insurance requirement might be enforced, whether the small vessel insurance market covers wreck removal risks for the liability associated with the Wreck Convention, and whether there should be a minimum tonnage threshold size of vessel such as 20 GT. Canada’s Discussion Paper on a proposed Canadian legislative regime for the remediation of hazards related to shipwrecks is a positive step in outlining many of the issues relating to addressing the problem of wrecks and derelict vessels on our coasts. Through Transport Canada’s consultation with stakeholders, it is hoped that potential difficulties in the application of the proposed regime will be carefully considered and addressed before implementing legislation is drafted, debated and ultimately enacted.

David K. Jones is a maritime lawyer and partner with Bernard LLP in Vancouver, B.C. and can be reached at jones@ bernardllp.ca.

October 2015 BC Shipping News 45

BALLAST WATER Ballast Water Management

An update on IMO and U.S. regulations Photo: BC Shipping News

R

ecognizing the importance of keeping abreast of updates on ballast water management regulations, the International Ship-Owners Alliance of Canada hosted a presentation by Michael Michaud, Vice President, North American Western Region, ABS, at a recent members’ luncheon.

With welcomes and introductions from ISAC President Oscar Pinto and (Acting) Secretary General Lanna Hodgson, Michaud provided a comprehensive overview of the IMO Ballast Water Convention, U.S. Ballast Water Regulations, and an up-to-date status report which included implications of outstanding issues and how they were being addressed.

Catch up — IMO status

Very simply, the International Maritime Organization Ballast Water Management Convention will require all ships to: • implement a Ballast Water Management Plan; • carry a Ballast Water Record Book and carry out ballast water management procedures; • meet ballast water exchange standards (Regulation D-1); and • meet ballast water performance standards for the discharge of organisms (D-2).

At the IMO level, there are currently 56 Ballast Water Management Systems (BWMS) that have received type approval.

The Convention requires ratification from 30 states, representing 35 per cent of the world merchant shipping tonnage before coming into force (one year after meeting that target). At present, 44 member states have ratified the Convention (including Canada in 2010) with 32.86 per cent of the world’s tonnage.

While there is a sufficient number of states, 2.14 per cent of the world’s tonnage is still required.

In predicting when the goal of 35 per cent of tonnage would be reached, Michaud noted that Argentina, India and Indonesia are close to ratification, and that there are rumours that Singapore, Finland, Italy and Malta may also be close. “Most countries announce their ratification at an IMO Marine Environment Protection Committee meeting,” said Michaud. “The next meeting is scheduled for March 2016 so unless something changes, we would expect the earliest for ratification would be at this next MEPC. If ratified in March 2016, entry into force would be one year later — March 2017.”

Michaud noted that the date is an important issue: “If entry into force is March 2017, the enforcement date would be the first International Oil Pollution Prevention (IOPP) renewal survey of the vessel following that date. If the Convention was ratified this year, entry into force could be before December 31, 2016.”

For vessels with a keel laying date prior to entry into force, the implementation schedule for enforcement of the D-2 standard has been aligned with the IOPP renewal survey. Vessels with a keel laying date after entry into force are to be in compliance with the D-2 standard at delivery. So the specific date of compliance to the D-2 standard depends on the date of entry into force. “You may end up only having one year to install a unit,” said Michaud, noting that this is the current interpretation of the regulations however he believed that it would be corrected should the early ratification play out.

46 BC Shipping News October 2015

Michael Michaud, Vice President, Western Region, ABS

As many attendees at Michaud’s presentation were aware —and indeed is a source of great concern, the U.S. has not ratified the IMO BWM Convention and have instead implemented their own requirements...

There are a number of items still under discussion for revision of the text of the BWM Convention. At the MEPC 68, held in May 2015, the “Group of Experts on Scientific Aspects of Marine Environment Protection — Ballast Water Working Group” lowered the maximum allowable discharge of Total Residual Oxidants. The International Chamber of Shipping initially identified 10 items within the Guidelines (G8) for revision and have identified 20 additional items that require further discussion.

It was noted at the last meeting that there will be new requirements for testing and certification of IMO type approved units and that a means for non-penalization of early movers would be identified for vessels that already have these installed and are operating BWMS. The changes will include an extended trial period for sampling analysis.

Industry concerns that are currently under review by the Correspondence Group on the Review of the Guidelines (G8) and will be addressed at MEPC 69 in April 2016, include: • Testing being performed using fresh, brackish and marine waters;

BALLAST WATER Photo: BC Shipping News

• Testing considering the effect of temperature in cold and tropical waters on operational effectiveness and environmental acceptability; • Specification of standard test organisms for use in testing; • Challenge levels set with respect to suspended solids in test water; • Type approval testing discounting test runs in the full-scale testing that do not meet the D-2 standard and the results of test runs being “averaged”; • Type approval testing realistically representing the flow rates the system is approved for; • Any differences between type approval protocols of member states; • Any items raised by, and any data arising from, the study on the implementation of the ballast water performance standard described in Regulation D-2 of the Convention.

Status of U.S. requirements

As many attendees at Michaud’s presentation were aware — and indeed is a source of great concern, the U.S. has not ratified the IMO BWM Convention and have instead implemented their own requirements which are much more detailed.

In the U.S., a ship must be in compliance with US Coast Guard (USCG) regulations, the Environmental Protection Agency’s (EPA) Vessel General Permit (VGP) and individual state regulations (for example, California and Washington State both have their own ballast water regulations). Sixteen states in all have ballast water requirements.

In the U.S., Ballast Water Management Systems require separate testing and approval by the USCG with compliance dates based on vessel out-of-water drydocking. Looking at the implementation schedule, Michaud noted that that new vessels (defined as being constructed on or after December 1, 2013) would have a compliance date of delivery. Existing vessels would need to be compliant upon the first scheduled drydocking (defined as hauling out of a vessel or placing a vessel in a drydock or slipway for an examination of all accessible parts of the vessel’s underwater body and all through-hull fittings). For vessels under 1,500 cubic metres and over 5,000 cubic metres, compliance would be the first scheduled drydock after January 1, 2016; for vessels between 1,500 and 5,000 cubic metres, it would be the first scheduled drydocking after January 1, 2014.

BC SHIPPING NEWS

The Intenrational Ship-Owners Alliance of Canada proved its value to members by hosting a very inforamtion session on ballast water management regulations. Above: (Acting) Secretary General Lanna Hodgson and President Oscar Pinto.

Michaud then outlined the options for ballast water management in the U.S. given that there are no USCG type approved systems yet: • Use an alternate management system (AMS), of which there are 50 by 44 manufacturers; • Do not discharge ballast water in the U.S. (noting that this would not apply for tankers or bulkers but may be an option for container vessels with optimal ballast water within the ship); • Use U.S. drinking water (a very expensive and, in the case of California, infeasible option); • Use an onshore treatment plant (noting that there are no plants in existence anywhere in the world).

Bottom-line, there are only two practical options available — use a USCG-accepted Alternate Management System or request an extension for the compliance dates from the USCG. So far, only three BWMS vendors have announced submissions for USCG type approval packages through an independent laboratory: Trojan Technologies, Alfa Laval and DESMI.

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BALLAST WATER Twenty-seven vendors have submitted intent to apply and another 25 vendors have contracted with independent laboratories (IL).

Michaud was of the opinion that the earliest approvals may occur would be in the second quarter of 2016. “By January 1, 2016 however, the USCG is required to publish a practicability review on future changes to the USCG ballast water program.”

The three vendors who have submitted their applications use UV disinfection technology. Michaud thought these vendors will require additional review and consideration by the USCG because UV generally only renders organisms with the inability to reproduce rather than kill them. The vendors used a different method for counting organisms than the method identified by the USCG. Therefore, the approval of these systems

Implementation schedules for compliance of the IMO BWM Convention (above) and the US Coast Guard regulations.

48 BC Shipping News October 2015

will require additional consideration.

The USCG has not yet commented on the submittals by the UV vendors.

Looking at the process to achieve USCG type approval through independent laboratories, Michaud outlined a schedule that would take 18 to 24 months and includes land-based testing (for 20 weeks), shipboard testing (for six months), component testing (about 35 days), and a design and construction review (about 90 days). While some of the tests could occur in parallel, Michaud highlighted some difficulties — including limitations of the independent laboratories (until recently, only two ILs were approved and most of the laboratories were situated in northern climates, prohibiting testing outside of a March-toOctober timeframe to avoid water being too cold to test).

In comparing USCG and IMO requirements for ballast water management, Michaud was of the opinion that there wasn’t a “drastic difference” in the results required by each but that it was the analysis and testing requirements where the main discrepancies took place.

To achieve USCG type approval, all of the testing needs to be carried out with the Environmental Technology Verification Protocol and Shipboard Testing Requirements (ETVP-STR). So most of the systems require starting over with new tests. While the IMO BWM Convention has guidelines and testing facilities outlined, they don’t set detailed specific requirements identified by the ETVP-STR. Further, each flag administration may have a different set of procedures and review processes which is leading to disturbances such as different tests and different type approvals.

As mentioned earlier, there is a list of 50 BWMS from 44 manufacturers that are currently accepted as Alternative Management Systems (AMS). Michaud stressed the importance of choosing wisely as there are very specific guidelines on which systems can be used in certain regions. “The USCG has identified systems as being approved for either fresh water, brackish water or marine,” he said. “The USCG AMS approvals are very specific on where and under which conditions you can and cannot use the units.”

In general, the USCG has been accepting IMO BWMS under the AMS format with the reasoning that this would help implementation and make it easier.

BALLAST WATER In reality, it has raised more issues and more costs. “What’s more concerning is the number of units that are being tested at the ILs that are the not the exact models that have obtained AMS approval,” said Michaud. “If you’re considering a model to install, it’s very important that you ask the manufacturer if this is the unit being tested by an IL and if it’s not, will they be guaranteeing an upgrade kit.”

Sediment management — the other part of BWM

Noting that the actual IMO Convention is formally called the “International Convention for the Control and Management of Ships’ Ballast Water and Sediments,” Michaud touched on how these requirements fit into the USCG and EPA requirements.

In the EPA’s Vessel General Permit, there are requirements for sediment control. Michaud and ABS recommend this be done by regularly cleaning ballast tanks and ensuring the practice is well documented in the Ballast Water Management Plan and Record Book. Vessels must be a distance of 12 nautical miles outside of U.S. territorial waters before discarding any sediment.

Michaud stressed the importance of record-keeping and ensuring crew were familiar with the requirements. He referred to the USCG’s “Guidance on verification of Fouling Maintenance and Sediment Removal Procedures” to assist crew in ensuring they were in compliance. “USCG is very big on records,” he said.

“The worst thing that can happen is not being able to show records that you’re in compliance and it’s very important that the Safety Management System has your crew ready for whatever regulation confronts them. Even when they go from state to state.”

He echoed that importance when reviewing U.S. port state control requirements. He also noted that records should show biofouling plans as well as sediment discharge plans and that the USCG would also be looking at fouling on the outside of the vessel during inspections.

Final thoughts

Summarizing his presentation, Michaud outlined some of the main issues and the work that was being undertaken

by ABS and other class societies to assist and inform vessel owners. Within the ABS’ Environmental Performance Team, under Operational & Environmental Performance (OEP), there are some very qualified staff who can help to make the decision process less complicated. “Our Vice President of OEP, Dr. Christina Wang, is joined by Debra DiCianna and William Burroughs, both specialists in ballast water management.” Debra DiCianna, having worked at the EPA previously, is proficient in regulatory requirements and treatment system effectiveness. William Burroughs transferred to ABS from a BWMS equipment manufacturer and bears broad expertise in BWMS technologies and installation optimization.

Additional services that ABS offers include guidance for ship owners in identifying effective solutions and delivering a customized evaluation to aid in the decision-making process.

The technology evaluation includes a review of the vessel or fleet, operational and life cycle information; a preliminary list of BWMS options; a preliminary report for suitable BWMS design and operations; and a comparative suitability assessment for operational considerations. ABS can also assist in understanding vendor technical and service offerings and deliver a final report outlining options available for ship owners.

He also indicated that there were a number of publications published by ABS that provide more detailed information.

He invited attendees to visit www.eagle.org for more information. BCSN

Enforcement and compliance

Regarding enforcement and compliance for BWMS, Michaud pointed out that the USCG is developing a means to ensure the equipment is in compliance with the discharge standards — not just verification of a type approved system. Ballast water management systems compliance is to be based on performance.

In 2013, the EPA modified the Vessel General Permit’s ballast water requirements to align with IMO and USCG, however the VGP does contain additional effluent limits on treatment systems that use active substances.

Ballast monitoring requirements in the VGP include functionality monitoring, equipment calibration, and biological organism monitoring which must be counted twice a year. Samples need to be sent for analysis quickly to ensure hold times are not compromised. According to the EPA, testing can be carried out at any water lab in the U.S. or worldwide and does not require specific type approval. In addition, records must be maintained for three years.

And while the USCG will be providing extensions for a set period of time, Michaud warned that the EPA VGP does not have a similar clause. “Even though the USCG may give you the extension, technically, you’re not in compliance with the VGP if you don’t meet all of the requirements outlined in the VGP.” However, he noted that the EPA has identified ships operating under a USCG extension will be a low enforcement priority if certain conditions are met.

October 2015 BC Shipping News 49

SHIPYARDS Progress update

Power plant vessel in the final stages One visit to Meridian’s yard on the North Fraser River and it quickly becomes apparent that the team has been extremely busy.

Photo by Dave Roels (www.daveroels.com)

W

hen BC Shipping News first reported on the Dent Island Tidal Power Generation project at the beginning of this year, the team at Water Wall Turbine Inc. (WWT) had just contracted Meridian Marine as the shipbuilder of record for the innovative, selffloating power plant. Fast forward seven months and the WWT Turbine Tidal Power Generation vessel is past the halfway mark and visibly taking shape.

With over 4,000 parts to assemble, Jim McFadden, President, Meridian Marine Industries Inc., has a crew of about 50, split between day and night shifts, working to join the pieces together in modules which will then be constructed into one complete vessel.

Refresher

The WWT Turbine Tidal Power Generation vessel is the fifth newbuild hull for Meridian Marine but is the first of its kind in the world. The vessel is a 17-by28-metre catamaran-type barge housing a turbine that will use river currents to generate power for small coastal communities — this first, full-scale model is being used to power a family-owned Dent Island Lodge.

The brainchild of Marek Sredzki and Lodewyk Botha — partners of Water Wall Turbine Inc., the vessel is the culmination of over 10 years’ worth or research into power generation from water currents and tidal energy. Small-scale testing, which began in 2004, showed the

50 BC Shipping News October 2015

Mehran Zargham , Jim McFadden and Andrea Baldini stand in front of the hull of the Turbine Tidal Power Generation vessel.

viability of extracting large energies from currents. Following the success of initial testing, Sredzki and Botha secured patents, conducted proto tests and finally, building a definitive scaled turbine model that verified the efficiency of the energy harvesting method. Russ Baker, who is looking after business expansion, is hoping to introduce WWT projects to First Nations remote communities.

By installing rotating turbine components within a specially built barge, the self-floating power plant can operate in shallow waters — a minimum of a fourto-five-metre draft — with tidal or river currents in remote areas to generate up to five MW of electricity with different turbine sizes and powertrains at a competitive cost that is more predictable and efficient than solar or wind. A Tesla battery energy storage system will be used in this full-scale plant with WWT innovative microgrid to store energy to allow for consistent delivery of power.

Designed by Ivan Erdevicki, President, ER Yacht Design, the barge will have a high degree of stability through the

addition of multiple tanks that allow the vessel to meet the requirement for minimal movement despite constantly changing flow and velocity. The Switch, a Finnish company that is a pioneer in advanced power conversion technology, will supply the converter; and Brevini Gear Systems has designed a totally integrated mechanical and electrical drivetrain which includes cooling and lubricating systems. Prime Engineering of Victoria has developed unique controls systems for powertrain and first of the kind ocean energy microgrid.

Visible progress

One visit to Meridian’s yard on the North Fraser River and it quickly becomes apparent that the team has been extremely busy. Already, the pre-cut, preformed pieces of steel are taking shape into the barge walls and the superstructure which will cover the turbine. When complete, the vessel will weigh in excess of 500 tonnes.

To assist in the project, McFadden has brought in engineers-in-training Mehran

SHIPYARDS Photo by Dave Roels (www.daveroels.com)

Zargham and Andrea Baldini. “Providing this kind of hands-on training gives them knowledge they wouldn’t get from books ,” said McFadden. “It will really help them progress as good, experienced engineers.”

Zargham, recently graduated with a degree from BCIT for Mechanical Engineering, and who will be joining UBC’s Naval Architecture and Marine Engineering program this fall, has been managing the project on a daily basis and working with shop staff to ensure scheduling and progress is kept on track.

In addition, Zargham has also taken on the weekly progress reports that are submitted to WWT and federal government partners within Natural Resources Canada and the ecoEnergy Innovation Initiative and Clean Energy Fund.

Using the CAD software program Rhino, Zargham has broken down the complicated design drawings to identify plate numbers by colour, making it much easier for shop staff to follow instructions.

Zargham noted that the project involved a lot of welding and the Rhino program was useful in finding ways to minimize the welding for the turbine “to avoid undue distortion of the shaft,” he said.

The superstructure that will house the turbine will be fitted to the hull (below).

Working with Andrea Baldini, who has worked around the world on engineering projects with an environmental aspect, the next step will be to bring the hull and superstructure together. “We’ll have to take it out of the shop to be able to bring the two pieces together,” said McFadden, noting that the final height of the vessel will exceed the clearance in their building. “We’ll transport the hull to our drydock and floating it alongside so we can finish off the outfitting.”

Marine and Shipyard

Solutions

Following testing at Meridian Marine’s dock, the vessel will be shipped up to Dent Island where it will be secured to the seabed with cables before final testing and initiating power generation. “This part of the process should take about one month,” said Andrea Baldini who has been working with WWT to prepare the site at Dent Island. “We should be ready to begin supplying power for the 2016 season at the Lodge,” he continued.

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October 2015 BC Shipping News 51

SPILL RESPONSE New oil spill rapid response vessel for the West Coast

W

estern Canada Marine Response Corporation (WCMRC) launched their newest oil spill response vessel in early September in Burrard Inlet. The boat, named after former employee George Penman, was christened at a private ceremony in Coal Harbour.

The $4.5 million G.M. Penman is a 65-foot Ocean Class Oil Spill Response Vessel (OSRV) built by Rozema Boat Works in Washington State. It is only the fifth vessel of its kind in the world with sister vessels operating in Santa Barbara, servicing the offshore production platforms off the California coast.

“The 65-foot OSRVs are smaller, faster and more cost effective than older unsheltered water vessels,” says Kevin J. Gardner, President and General Manager of WCMRC. “The G.M. Penman provides WCMRC with improved open water rapid response and night time operations capacity.”

With family members, WCMRC staff and the local marine community in attendance at the ceremony, Gardner spoke of George’s long-time dedication and passion for his job.

Having joined Burrard Clean in 1989, George spent much of his career on Vancouver Island when, at that time, there were only eight employees for the whole organization.

“George was a pioneer who created the fundamental principles of WCMRC that you see today. It is nice to see that once again, we have a Penman watching over the Island,” said Gardner, noting that, after sea trials are completed in the Lower Mainland, the G.M. Penman will be deployed to one of WCMRC’s satellite response bases on the West Coast. Gardner spoke highly of the efforts of WCMRC staff, naval architects Robert Allan Ltd., and the Rozema team.

“The G.M. Penman provides WCMRC with improved open water rapid response and night time operations capacity.”

Randy Neufeldt, who spoke on behalf of WCMRC employees, described George as an “icon.” In addition to noting that George took great pride in his work, Randy said, “George Penman could always be counted on and never let us down. Let’s expect the same from his namesake.”

George’s daughter, Karima, thanked the WCMRC, saying that her Dad would be proud and honoured for the tribute.

The G.M. Penman has a top speed of 26 knots when travelling to an incident. Once on-scene, the boom arms can be deployed within minutes. Two onboard Lamor skimming brushes have a combined skimming capacity of 32.8 tonnes per hour.

With overnight accommodation space for five crew members and a FLIR (forward-looking infrared) camera, the G.M. Penman is the first vessel in WCMRC’s fleet that can operate continuously for multiple days in open water before requiring resupply.

The G.M. Penman joins WCMRC’s fleet of 32 spill response vessels, including two other Rozema-built vessels — 47-foot Bay Class OSRVs, the Eagle Bay and the M.J. Green.

Should the Trans Mountain expansion project proceed, WCMRC will be implementing a $100-million investment to create new response bases in the Salish Sea and fund new equipment, including the addition of a number of similar G.M. Penman-sized oil spill

Photo courtesy WCMRC (Richard Lam)

The G.M. Penman, WCMRC’s newest asset for oil spill response on the West Coast.

52 BC Shipping News October 2015

SPILL RESPONSE Photos courtesy WCMRC (Richard Lam)

The Penman family stands with WCMRC staff during the christening.

response vessels to WCMRC’s fleet. The new response bases and vessels will cut planning standards for response times in half and significantly increase response capabilities.

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Photo: Dave Roels

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