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NOISY SHIPS ATTRACT MORE HULL FOULING
Ships in port running generators are attracting more hull-fouling sea creatures because of the noises they make, according to groundbreaking research by New Zealand scientists.
Marine fouling, where barnacles, mussels, sponges and algae attach to a ship’s hull, is a huge cost to the shipping industry through increased drag. Millions of dollars are spent each year controlling fouling on commercial vessels and a lot of it involves applying toxic anti-fouling paint.
In world-first research, NIWA and Auckland University scientists have discovered that fouling of vessels is greatly increased by the underwater sounds produced by the vessels. Ships’ generators continue to run while they are in port and appear to produce a lot of underwater noise.
Trials with underwater speakers and recording of cruise ships, logging and container ships, and mussel larvae showed the larvae settled on the noisy hulls about 40 per cent quicker than the silent hulls, said NIWA biosecurity scientist Selena Wilkins.
“The mussel larvae settled very quickly - within a few hours. This is within the time frame that the larvae would be exposed to the noise from a generator in a vessel in port.”
The “very exciting” research could have huge implications for not only the efficiency of ships, but also for biosecurity as many invasive organisms can be spread by ships’ hulls, Dr Wilkins said. The scientists are hoping to suggest ways of reducing the underwater noise produced by ships, such as dampening or eliminating sound or switching to shore-based electrical supply when berthed.
It is known that sound triggers larvae of many coastal organisms to settle more rapidly. Fish and crab larvae are attracted toward the underwater sound of waves breaking on coastal reefs and noises produced by other reef-dwelling organisms during feeding.
SHIP ARREST HITS SANFORD EARNINGS
BY JAZIAL CROSSLEY
Listed fisheries company Sanford’s earnings have taken a hit in the first three months of the current financial year due to its San Nikunau tuna boat being impounded in American Samoa for pollution. The tuna fishing ship was put out of action for eight months after it was seized by authorities in July.
The company is charged with pollution, conspiracy and obstruction of justice in the United States for the vessel discharging oily bilge waste, and presenting false documents to the US coast guard and American Samoan authorities.
Sanford paid a $1 million bond to have the ship released but it is not allowed to resume fishing activities until February 1. Until then, it is tied up at Pago Pago.
In the first three months of the financial year from October 2011, Sanford’s sales were down 5 per cent compared to the same time a year earlier. Tuna sales suffered the most with the San Nikunau out of action.
The slideshow Sanford presented to NZX this week with its managing director Eric Barratt’s AGM speech notes included a blank slide because he didn’t want his rather non-committal comments about the case made public, even though he restated them at the public AGM today.
”I don’t want this recorded,” Mr Barratt told the room of shareholders at Auckland. ”The San Nikunau was arrested. It was released under bond, and the company is facing some charges in the US going to court in Washington. ”We’re actively defending the charges, we have a team of legal people working with us. It’s difficult to talk in too much detail because we can’t disclose what our defence is at this stage in the prosecution, so I can’t go into detail. But we are very confident we will defend our position.”
© Fairfax NZ News
CORONER BACKS REPORT ON SAILOR’S DEATH
A coroner has backed a transport investigator’s call for international shipping regulators to improve safety on ships after a man was crushed to death in a watertight door.
Chandima Anuradhu Weerasekara, 35, the chief engineer of the Oceanic Discoverer, died after being trapped in the door for more than eight minutes while the ship was berthed in Napier in February 2009.
A Transport Accident Investigation Commission report found the door didn’t meet the minimum requirements of the International Convention for the Safety of Life at Sea, and the ship’s safety management system didn’t ensure the watertight doors were properly maintained. It was also possible the audible alarm warning that the door was closing wasn’t working, the report said.
The report called on the director of Maritime New Zealand to discuss watertight door safety with the International Maritime Organisation, and for the Australian Maritime Safety Authority chief executive to address issues with the safety management system on board the Oceanic Discoverer. It also recommended the manufacturer of the watertight doors to address possible design issues.
Coroner Christopher Davenport said he wouldn’t hold a formal inquest as it had already been covered thoroughly by the TAIC report. He endorsed its recommendations.
RENA SALVAGE UPDATE
The latest savlage reports from the Rena recovery project are as follows:-
Salvage
Salvors yesterday (23/01) removed four dangerous goods containers from the bow of Rena. The containers held empty tanks which formerly held hydrogen peroxide and still have residual amounts of the chemical inside. Braemar Howells has plans and procedures in place for handling the containers when they are brought ashore.
This means there are no dangerous goods containers left above deck on Rena. There are still dangerous goods containers in the holds of the wreck. More information on the dangerous goods held on Rena is available here http://www.maritimenz.govt.nz/Rena/Container.asp#danger_goods.
The total number of containers removed from Rena since it broke in half is now 43.
Salvors also removed 18 packets of timber manually from the bow section yesterday - approximately half a container load.
Observation flights have identified no significant changes to the two sections of the wreck. The weather around the Astrolabe Reef is fine today and forecast to remain clear for the next few days.
Container and debris recovery
More than 2,300 tonnes of waste has been processed by Braemar Howells - the company responsible for distressed container and cargo recovery - since the Rena grounding.
Braemar has processed about 2,325 tonnes of waste. Figures show that 1870 tonnes of waste has gone to landfills including about 25 tonnes of milk powder. A total of 117 tonnes of liquid waste has been processed and taken away for disposal by an environmental company. Liquid waste does not include oil, and is predominantly blood washed out of refrigerated containers.
A break-down in figures shows that waste processed to date includes about 177 tonnes from Waihi Beach and 77 tonnes from Matakana Island. The tonnage of waste collected and processed does not include timber.
Recently released figures also show that Braemar has processed 120 containers.
Meanwhile, fridges are making an appearance on the debris clean-up front. Braemar confirms that at least four fridges have washed up on shore - one on Slipper Island, one on Matakana and two on the East Cape. Small amounts of debris - including the fridge - have been found as far north as Slipper Island. This has been confirmed by MNZ’s shoreline clean-up assessment team.
A number of one tonne bags have been delivered to Motiti Island today for ongoing debris collection.
Oil spill response
Around 40 oil spill responders are working today on clean-up operations at the Mount, on Matakana, Rabbit and Leisure Islands and at Kauri Point. A shoreline clean-up assessment team is working north of Kauri Point today (24/01).
An aerial observation flight this morning confirmed a metallic sheen around the wreck with a small amount of dark oil within it. A lighter sheen was observed stretching about 3km from the wreck.
Members of the public are urged to please contact the 0800 OIL SPILL (0800 645 774) if they come across oil - please provide the best details possible about the location of the oil, and an estimate of the amount observed. Every report is fed into our planning process and followed up.
Wildlife
No oiled birds were picked up over the last 24 hours. Work is continuing on demobilising the Te Maunga wildlife facility. It is expected all equipment will be completely removed this week. Some response equipment will be kept in the Bay of Plenty in case there is a need to escalate the wildlife response.
PORT OF AUCKLAND AVERTS STRIKE ACTION
Ports of Auckland has advised that MUNZ has withdrawn its planned 24hr strike notice for 7 am January 31. The union has instead accepted POAL’s offer of a paid four-hour stop-work meeting with its members.
POAL has received an undertaking from the union that members will return to work as soon as the meeting is concluded. All union members who are interested in attending the meeting will be permitted to do so. The container terminal will continue operations using non-union staff.
POAL has indicated they would be happy to consider an earlier meeting date, and are awaiting a union response to this. However, at this stage POAL is planning on the stop work meeting starting at 7 am on the 31st, for a maximum of four hours.
PARTLY FLOAT SEA AND AIR PORTS, SAYS COMMISSION
Councils should consider partly privatising their port and airport assets, while ports rendered less efficient by their labour practices would benefit from more competition, says an important new report from the Productivity Commission..
The Commission’s draft report on international freight transport, published this week, found air freight costs for New Zealand traders were 15 per cent higher than those in Australia and sea freight costs 20 per cent higher.
Among the factors affecting costs, port productivity compares favourably with overseas, but some ports are better than others, with Tauranga the best. Wellington’s Centreport ranked ahead of Port of Napier but behind Auckland, Lyttelton and Otago.
Wellington City Council, which owns the city’s port, said it needed to consider the report before reacting to it. “But obviously we are interested in anything that has an economic impact on the city and the region,” a spokesman said.
Auckland mayor Len Brown ruled out any privatisation of Ports of Auckland.
“Aucklanders have made their views clear. They wanted the council to retain ownership of their strategic public assets and I will honour that commitment,” Mr Brown said.
Productivity Commission chairman Murray Sherwin said Tauranga’s use of competing stevedoring contractors was part of the reason for its higher productivity.
“It’s a pretty well-run company by all accounts - and it shows across many of those productivity and performance indicators - and I think its counterparts would acknowledge that’s the one they look to for performance benchmarking,” he said.
The report has been published as a dispute over attempts by Ports of Auckland to change work practices comes to a head.
Ports of Auckland chief executive Tony Gibson said his port was well-placed to compete with the best in the region, “but we need fundamental changes to current labour practices to achieve that”.
The report said it was time to axe international shipping lines’ exemption from competition law. The exemption allows shipping lines to co-operate in ways that could be illegal in other industries, and the report said there was no longer any need for it.
Mr Sherwin said it did not appear to be a big factor in freight costs now, but that removing the exemption could be beneficial in the future.
Submissions on the draft report can be made until February 27. The final report is due to be presented by April 1.
RENA GROUNDING RECOVERY COSTS REACH $25 MILLION
The Rena grounding has already cost taxpayers $25 million, but how much will be paid back remains unclear.
Transport Minister Gerry Brownlee confirmed Maritime New Zealand’s response to the disaster had consumed the $4m oil pollution fund and was now eating into money provided by the Government for the cleanup.
The stranded container ship ran aground on Astrolabe reef, off Tauranga, in October, leaking hundreds of tonnes of oil and killing thousands of birds. It split in two during the weekend, with the stern section stuck on the edge of the reef and largely under water.
Costamare Inc, the parent company of ship owner Daina Shipping, is covered by insurance company Swedish Club for pollution liability to a total of $1.74 billion. However, under New Zealand law, the company’s liability for environmental damage is capped at $12m, although there is an option to prosecute Costamare under the Resource Management Act for the full cleanup cost.
The ship’s charterers, MSC, are not liable but have pledged an initial $1m.
Mr Brownlee would not be drawn on which parties he expected to bear any extra costs.
“The Government has open lines of communication with the owners and insurers and expects to engage with them about the environmental and financial implications of the situation once it is clearer what those implications are,” he said.
Constamare promised to do everything possible to mitigate the effects of the grounding. It had been working with the salvors and insurers on plans to deal with both parts of the wreck and these would be discussed with other experts and state authorities. The company and its insurers would continue to fund the salvage operation, including the recovery and processing of containers.
MSC New Zealand general manager Phil Abraham said it was too early to say what the total costs would be or if it would donate any more money. Where the $1m donation would be distributed had yet to be decided. “There’s a hell of a lot of unhappy people that we have to appease.”
Yesterday,(Jan12) six containers that had washed ashore at Waihi Beach had been removed, with another 10 remaining. Eleven containers will be removed from Matakana Island as soon as possible.
Members of the public caught taking items washed ashore from the containers could face prosecution under the Maritime Transport Act. Ownership of the cargo remained with the owner or the owner’s insurance company until they officially abandoned the right.
Several patches of oil sheen, measuring about 100 metres by 50 metres, had been identified, but no oil was expected to wash ashore until tonight.
PORTS OF AUCKLAND LOOKS AT STEVEDORE OPTIONS
By Nick Gray
Jan. 10 (BusinessDesk) - Ports of Auckland plans to approach at least three outside stevedore contractors this week in a bid to break an 11-month impasse with its own workers, whose strikes have been blamed for the loss of major customers.
“Change has got to happen,” chief executive Tony Gibson told BusinessDesk. “We have a business to run and clients to keep happy.”
Negotiations between Ports of Auckland and the Maritime Union of New Zealand (MUNZ) have stalled over the company’s plan to introduce flexible rosters that the union says will lead to a casualised workforce and loss of guaranteed hours for full-time staff.
By sharing the stevedoring work among several firms, the port would encourage competition, driving down costs and lifting productivity, Mr Gibson said. That change would also see Ports of Auckland move closer to the model used by arch-rival Port of Tauranga, the biggest beneficiary of Auckland’s loss of business.
“Tauranga has a very good model,” he said.
Mr Gibson’s background is in shipping companies including Maersk, the biggest line servicing New Zealand, and his appointment came just seven months before the expiry of the collective contract with MUNZ.
Mr Gibson said that when he took the position he was aware of the expiry date approaching, but he and the board had believed they could reach accord with the union “to build a strategic collaboration on what needs to be done here.” Instead, the union’s response had been “underwhelming”.
The port’s decision to contract out shuttles between its wharves and its inland port to its Conlinxx transport unit angered MUNZ because it displaced work formerly done by its members.
The most recent port offer included a 10 percent rise on hourly rates, performance bonuses of up to 20 percent, and the retention of existing benefits and entitlements in return for the new roster system that the port says will provide increased operational flexibility.
Currently, about 35 percent of hours paid for are for ‘down time’ meaning workers only work 26 hours out of 40, port spokeswoman Catherine Etheridge said.
As to whether the introduction of new rosters would force redundancies, Ms Etheridge said the loss of the Maersk shipping and Fonterra Corporation contracts to Tauranga have made job losses “inevitable”.
The MUNZ website states that “the union position is clear. It does not want the 10 percent - it wants secure, ordered and transparent rosters”.
Port of Tauranga, which is 55 percent local-body owned, uses at least four contracted stevedore companies and has one of is own, which compete with each other for contracts.
The union says the introduction of such an operating system at Auckland would create an environment in which worker safety would be sacrificed for the bottom line.
The strikes in Auckland echo labour disputes across the Tasman. Australia’s ports rounded out the worst 18 months for importers and exporters since 1998 due to industrial problems, Shipping Australia chief executive Llew Russell told the Australian newspaper yesterday.
Shipping Australia has made a submission to the federal government’s review of its Fair Work Act, suggesting restrictions on industrial action by unions, a tighter definition of `good-faith’ bargaining and for Fair Work Australia, the state-owned labour arbitrator, to have greater powers to intervene in disputes.
A shipping strike at Australia’s largest port in Melbourne was avoided last week after DP World offered Maritime Union Australia (MUA) workers a 15 percent increase over 3 years in exchange for productivity trade-offs.
RENA BREAKS UP
There has been a significant change in the status of the Rena overnight, with the ship separated into two pieces that are now 20-30m apart.
Seas of up to 6m hit the vessel overnight.
Weather conditions continue to be poor, with the current severe weather expected to carry through for the next 3-4 days. The forward section of the ship is in its original position on the reef, with the stern section broken away and moving significantly, but still on the reef.
There has been a significant discharge of containers and container debris from the ship. This may result in the 3nm exclusion zone being extended. The National Response Team has been activated to respond to the potential release of oil from the ship and to treat any affected wildlife.
PORT PREPARES FOR CEMENT LEASE
New Zealand’s foreign investment watchdog has approved a leasehold deal at Timaru’s port as part of a Swiss cement giant’s plans for a $500 million plant near Oamaru.
The amount Holcim paid for the leasehold of 2.26 hectares at Evans Bay in Timaru for 50 years and more was kept confidential in the consent document released by the Overseas Investment Office. The land is for the wharf and storage facilities to handle cement from the new plant.
However, Holcim announced in October it would not make a decision on the proposed cement plant at Weston, near Oamaru, until late next year - another delay in a plan that has already taken more than five years to get this far.
Holcim is lining up the facilities for the project if the company’s board in Switzerland gives the go-ahead.
A new wharf at Evans Bay is to be built with adjacent cement and clinker storage in silos and loading equipment . Construction of the big cement works at Weston, which would have the capacity to produce 860,000 tonnes a year, is expected to create 480 jobs.
Primeport Timaru expects another one million tonnes of cargo a year and at least one more ship visit each week if the Weston plant goes ahead.
Primeport chief executive Jeremy Boyes said yesterday the 50-year plus lease would not go through unless the Holcim board gave the project the go-ahead. The commercial arrangements were confidential.
The port would be building the new wharf and Holcim would be installing the storage and and loading facilities.
Asked why the information was confidential when the port was 71 per cent publicly owned by the Timaru District Council, Mr Boyes said the port operated in a commercial environment. If the project got the go-ahead, elements of the commercial relationship might become public, but nothing more than what was normally in an annual report.
FONTERRA QUITS AUCKLAND AS DISPUTE CONTINUES
Dairy giant Fonterra, the country’s biggest exporter, has quit trading from Ports of Auckland as strikes by Maritime Union member workers continue. Port of Tauranga and Port of Napier will share the load, picking up Fonterra’s $27 million weekly trading, from the end of January until further notice.
Union member Ports of Auckland workers have been in negotiations with their employer for better pay since August, with major client Maersk pulling out of the port to move its trading to Tauranga last month due to the industrial action at Auckland.
Ports of Auckland chief executive Tony Gibson said it was inevitable customers would need to move operations elsewhere with uncertainty caused by the strike action. It recently put its ninth offer to the union which remains on the table.
”Following Fonterra’s decision, I have today advised the union that this is our best and final offer,” he said. “It includes a generous 10 per cent rise on hourly rates, performance bonuses of up to 20 per cent on hourly rates, and the retention of existing benefits and entitlements in return for a new roster system that will provide increased operational flexibility while allowing workers to plan their rosters a month in advance,” Mr Gibson said.
”Coupled with the departure of Maersk’s Southern Star service to Port of Tauranga, the loss of Fonterra’s business means that action is needed urgently.”
The Port of Napier is now pitching to permanently secure Fonterra’s shipping business, which has been caught up in industrial action between Ports of Auckland and its workers.
Port of Tauranga and Port of Napier will share the shipping of the 500-to-700 containers a week of Fonterra products.
Port of Napier services manager Bruce Lochhead said that it had been working closely with KiwiRail, Fonterra and shipping lines to move dairy products by sea from Hawke’s Bay.
“We’ve got the capacity here to handle more and our whole forward plan and our infrastructure masterplan is geared around increasing our capacity to handle container trades as well as cargo trade,” Mr Lochhead said.
Fonterra was the only company Port of Napier had been in talks with to pick up trade being moved from Auckland because of the strikes.
Maritime NZ national president Garry Parsloe played down Fonterra’s move from Ports of Auckland, saying companies shifted ports often.
“Fonterra used to come out of New Plymouth for years and years because it’s closer to their factories and that, but they shifted to Auckland a couple of years ago for commercial reasons because they got a cheaper rate.”
Mr Parsloe said the union had requested mediation with Ports of Auckland but that had been declined.
“The port company never responded - probably too busy lying on a beach somewhere and not worrying about the port. It’s probably their fault [Fonterra moved its trading] for not bloody trying to fix this dispute up.”
The union has notified that strikes will continue until next Wednesday at this stage.
RENA OFFICERS FACE NEW CHARGES
The two sailors facing charges related to the grounding of the cargo ship Rena on the Astrolabe Reef are each facing a new charge of obstructing/perverting the course of justice.
The 236m ship struck the reef early on Wednesday October 5.
The Rena’s captain and navigation officer appeared in the Tauranga District Court where the new charges were laid. Details about why the new charges were laid were not revealed in court as the Crown required a time extension to allow new documents to be filed.
The men were also charged under the Maritime Transport Act for operating a vessel in a manner likely to cause danger and under the Resource Management Act for discharging a contaminant.
Judge Christopher Harding extended their interim name suppression. The pair was due to reappear in court on February 29.
MNZ will set up new unit for Rena inquiry
Maritime New Zealand will establish a dedicated unit to manage the response, investigation and inquiry into the Rena’s grounding in Tauranga harbour.
The organisation has started advertising for a general manager for the unit that would be made up of “MNZ staff, secondees and specialists.”
About 350 of the 1700 tonnes of oil on board spilled into the ocean after the cargo ship ran aground on the Astrolabe Reef, Tauranga on October 5, and 65 containers are unaccounted for.
Several inquiries are under way and the ship’s master and navigational officer have been charged under the Maritime Safety Act and are awaiting trial.
A Maritime New Zealand spokesman said the Rena response was expected to take up to two years - and a dedicated unit was needed so the organisation could also handle other ‘business as usual’ activities.
“MNZ is a small organisation, and large numbers of staff are already working on these work streams. Given the long term nature of the Rena response, this will impact on MNZ’s ability to deliver its mandatory regulatory and safety functions.”
The new units core duties would be to provide and co-ordinate the investigations, prosecutions, salvage, operations and removal of the wreck as well as assisting with negotiations between the Rena’s owners and insurers.
Transport, Accident and Investigation Commission spo0kesman Peter Northcote said while most of the fact gathering had already been done, its investigation into the grounding was at an early stage.
A timeframe of between 12 and 24 months from the accident date was common, but the commission aimed to have its investigation finished within a year, he said.
RENA SALVORS WILL NOT CLAIM SECURITY OVER PERSONAL EFFECTS SALVAGED
Svitzer Salvage has clarified reports regarding personal effects in containers onboard the Rena.
It is a standard and long-held practice for maritime salvors to ask insurers of stricken vessels for a guarantee over a percentage of property on board, as a means to ensure that there will be payment for salvage work undertaken. Such salvage work is costly and protracted, and can present extreme commercial risks unless payment safeguards are in place.
Due to confidential arrangements with insurers and emotional factors concerning personal property owners, it is not appropriate for a salvage company to publicly discuss details of such arrangements.
However, given the difficult nature of the Rena operation and the lack of clarity on how long it may take and how much it may cost, Svitzer can confirm that the percentage safeguard is higher compared to some other salvage operations, but not out of proportion to other salvage operations.
The guarantee structure is a standard industry arrangement between Svitzer Salvage and the insurers of the Rena and her cargo. The percentage is indicative and precautionary and does not represent the actual payment to Svitzer Salvage. The payment to Svitzer Salvage will not be known until the operation has concluded. The guarantees being arranged now are paid to the vessels insurers, who will ultimately pay Svitzer Salvage when the salvage costs are known.
In recent days a general notification was distributed to all parties with cargo on the Rena, giving broad and indicative advice about cargo security arrangements. This was standard communication sent by default.
The Charterer of the Rena - Mediterranean Shipping Company - has only informed Svitzer in recent days about how many containers with personal effects are on the Rena. According to MSC, there are only nine such containers on board.
Svitzer Salvage will NOT take security over any items in these nine containers that have been declared as holding personal effects and belongings. Such items include household furniture, appliances and vehicles. This means that owners of personal property on the Rena not destroyed or lost should get their belongings back, regardless of whether or not they are insured. There has never been an intention to hold security over such personal items.
Owners of personal property on the Rena should still liaise with their insurers to be clear of their circumstances, and the Rena charterer, Mediterranean Shipping Company, which is ultimately responsible for the Rena grounding and associated salvage costs. Mediterranean Shipping Company is also responsible for handing personal effects back to their owners.
Svitzer Salvage will continue to focus on the complex Rena salvage operation.
PORT AKMONS WILL TAKE OVER NEXT YEAR
Crayfish lurking in Port Taranaki’s breakwaters will get a shake-up next year when the structures are beefed up with thousands of tonnes of new akmons. New Plymouth residents can’t help but notice a large pile of irregular-shaped concrete blocks accumulating behind Port Taranaki headquarters in recent months.
These are akmons and will be used to strengthen both the lee breakwater and main breakwater early next year.
Port Taranaki chief executive Roy Weaver said the akmons, which were made on site by port workers, would be used to strengthen and repair the breakwaters after heavy seas had moved and eroded some of the blocks over the years. The breakwaters required ongoing maintenance and this latest spruce up would take about three years, he said.
On the main breakwater, 13-tonne akmons would be used, while 4.5-tonne akmons would be used on the lee breakwater. Huge waves eroded and relocated akmons over time, so fresh ones were needed periodically, he said. On some parts of the breakwaters, holes, slumping and irregularities were visible.
“Akmons will get tossed around in big storms and they will roll around over time even though they are made of concrete.”
In 2008, raging seas tossed several 13-tonne akmons metres out of position and two ended up on top of the lee breakwater.
An extra 100 akmons would be added to the main breakwater while the lee breakwater would get an extra 80, he said. A crane situated on top of the breakwaters would be used to lower the akmons into position. The budget for this year’s maintenance was $350,000 and the upgrade would be completed in five stages.
Breakwaters were a necessary feature at the port because it was not a natural port with calm conditions such as Wellington and, Auckland, Mr Weaver said.
Caption: Mr Weaver is shown at right, with Port of Taranaki Civil Supervisor, Rob Wilson.
STATEMENT FROM OWNERS REGARDING THE RENA GROUNDING
“Following the grounding and spill from our vessel the Rena on October 5th, we apologised to the people of New Zealand and particularly to those living around the Bay of Plenty and surrounding areas and we do so again with all sincerity,” owners Costamare said today (18/11).
“The efforts of our appointed salvors, with the excellent support of Maritime New Zealand, have removed just about all of the oil on board and we thank and congratulate them for their efforts. We also thank the thousands of volunteers who have helped clean the beaches.
“Our insurers are working closely with the salvors and will be paying for the costs of removing the oil from the vessel. Our insurers will also continue to pay for the costs of salving the cargo and the vessel. In this respect, now that the oil has been removed, the focus will shift initially to the removal of the containers.
“Costamare will continue to assist the authorities with their investigation into the circumstances of the incident.”
LYTTELTON BATTLES INSURER OVER EARTHQUAKE CLAIM
Christchurch’s lead insurer is disputing the Lyttleton port’s latest insurance claim from the earthquakes that devastated the city, and the port will welcome just three cruise ships this summer, down from 64 last year.
Yet the port was able to tell shareholders at their annual meeting that it had a record quarter in the three months to September. It is forecasting a trading profit of between $13 million and $15 million for the full-year after notching up $4.1 million of that in the first three months.
The port has received progress payments of $35.7 million for both business interruption and material damage expenditure as a result of the magnitude 6.3 earthquake that struck on February 22.
A further progress claim of $11 million was made in August, which has grown to $20 million with additional expenditure over the past few months.
“Late yesterday we were formally advised by our lead insurer that at this stage they are disputing the progress claim,” chairman Rodger Fisher said. “We are taking this issue very seriously and we will be taking all necessary legal advice.”
The dispute related to the level of insurance for reinstatement of assets.
“It is our view, having reconfirmed overnight our legal advice, that LPC’s assets are covered for reinstatement. Significant resources have been and will continue to be committed to resolving these insurance issues,” he said.
The shares haven’t yet traded today and were last at $2. The stock has declined 11 percent this year.
Shareholders re-elected Brian Wood as a director and elected Karl Smith as a director. They were told that that the port handled 75,344 twenty foot equivalent containers in the first quarter, up 14.1 percent on the same quarter last year. October volumes were a record.
“New shipping services are contributing significantly to this container growth,” Mr Fisher said.
While coal volumes were on a par with the same time last year, log exports rose a significant 32.4 percent to more than 85,000 tonnes. The port expects log volumes to ease as exports to China come off their high.
Shareholders authorised an increase in the total amount of director’s fees payable by $9,000 to $304,000 per annum effective from Nov. 1.
The reduction in cruise ship visits will reduce annual gross revenues by $3 million, less associated costs, and this is included in the port’s insurance claim. The port is majority owned by the commercial arm of Christchurch City Council.
KESTREL BACK IN AUCKLAND BUT RESTORATION WILL BE COSTLY
The last of Auckland’s big double ended ferries still afloat will take hundreds of thousands of dollars to restore. The Kestrel is back in Auckland after spending recent years as a a floating restaurant in Tauranga.
Waterfront Auckland has donated around $85,000 to pull the boat out of the water next month to inspect it.
Kestrel Preservation Society member Hugh Gladwell says the group wants to see the Kestrel sailing up and down the Waitemata again.
“We’re looking at about $200,000 to $300,000 to get the boat operating again, in other words to get the boat sound, seaworthy and to get the engine running,” he said. Mr Gladwell is excited about Waterfront Auckland’s donation.
BLUFF COMMITS TO CAPEX OF $6.3 M. ON GOOD RESULT
The Port of Bluff operator, South Port New Zealand Ltd., will spend $6.3 million in the next financial year on new cargo-handling facilities in the largest commitment of capital spending since the company was formed in 1988.
South Port reported a net profit after tax of $5.98 million in the year to June 30, a 15 % improvement on the
the previous year as every major cargo category, including logs, processed sawn timber, meat and dairy-related exports and imports, and a record year of shipping from the Rio Tinto aluminium smelter at nearby Tiwai Point.
“In the port industry, it is unusual for almost all cargo sectors to be either growing or maintaining their existing tonnage levels at the one time,” said chairman John Harrington in a statement to the NZX. Total tonnage through the port had increased from 2.17 million tonnes in the previous financial year to 2.674 million tonnes, and the port had “at times been stretched with its existing resources to service an elevated base level of cargo.”
Consequently, despite forecasting profits 15% to 20% lower in the current financial year, Mr Harrison said the port was committing $5.8 million to a new, larger mobile harbour crane, and $700,000 on an additional heavy lift container forklift.
At the same time, South Port is lifting its total dividend payout for the year to 20 cents a share, compared with 17 cents last year. A final, fully imputed dividend of 14.5 cents a share, payable Nov 2, with a record date of Sept. 23.
The result was built on record revenues of $25.1 million, up 11% on the previous year, while earnings per share lifted from 23.9 cents to 19.9 cents on a normalised basis, which ignores non-cash impacts of changes to rules governing capital asset depreciation.
The reduced profit outlook owed to the strength of the New Zealand dollar, weakening dairy commodity prices, and debt-constrained European and American economies, along with a substantial increase in insurance premiums because of the Canterbury earthquakes.
At balance date, the port had only managed to replace some 80% of its expiring reinsurance cover, although the remainder had been purchased since then. With just 26.2 million shares on issue and issued capital of $9.4 million, the thinly traded South Port shares were unchanged today at $3.20.
PORT OTAGO GETS OKAY TO DREDGE
Port Otago has been granted a 20-year resource consent to proceed with its $100 million dredging proposal.
The port’s consent, which was lodged in September last year and heard before Easter permits it to widen and deepen the 13-kilometre channel from Port Chalmers to Aramoana’s salt marshes to 15 metres draught, dispose of about 7.2 million cubic metres of dregded spoil 6.5 kilometres out to sea, and extend the wharves and berths at Port Chalmers.
Currently able to cater for 281-metre and 4100 TEU container ships, at a draught of 12.5 metres, this development will allow the port to receive up to 347-metre and 8000 TEU vessels at a draught of 14.5 metres.
FREIGHT FORWARDING PENALTIES TOTAL $5.2 MILLION
The High Court in Auckland has ordered three international freight forwarding companies to pay penalties totalling $5.2 million plus costs for breaches of the Commerce Act.
BAX Global, Schenker AG, and Panalpina World Transport Holdings Ltd had reached settlements with the Commerce Commission which have now been accepted by the High Court. The penalties follow a commission investigation which began in 2007 into alleged collusion by a number of multinational companies involved in freight forwarding services to the New Zealand market.
BAX has been ordered to pay $1.4 million, Schenker $1.1 million and Panalpina $2.7 million for their roles in the price fixing cartel. These penalties are in addition to penalities already imposed by the court for similar conduct in the freight forwarding industry following settlements with EGL Inc and Geologistics International (Bermuda) Ltd. The total cartel penalities imposed to date are $8.85 million.
The commission’s freight forwarding cartel case continues against Kuehne & Nagel. A hearing to determine jurisdiction is set down for August.
RECORD PENALTY HITS QANTAS FOR PRICE FIXING FREIGHT
The High Court has ordered Qantas to pay a $6.5 million penalty, as recommended in the pre trial settlement in the air cargo cartel case. The starting point for the penalty had been $13 million but a 50 percent discount for Qantas’s high level of co-operation was recognised.
Meantime in a separate case, the Commerce Commission has commenced another action in which it alleges several international airlines colluded to raise the price of freighting cargo. Air New Zealand, Cathay Pacfiic, Emirates, Japan Airlines, Korean Airlines, Malaysia Airlines, Berhad, Simgapore Airlines and Thai Airways are defending the charges. The stage one hearing of the cartel case was scheduled to continue until early June, the commission stated.