INTERTANKO speaks at Ship Recycling Conference to emphasise uncertainty over timing and scale of single hull phase-out

With European activity on ship recycling stimulated by the forecasted boom in the single hull tanker recycling market, it was fitting that INTERTANKO presented its views on the market and the drivers affecting the phase-out statistics and projections during the Lloyd’s List Ship Recycling Conference this week in London.

 

Ship recycling continues to rise in profile as a major shipping and environmental issue, so it is little wonder that key players from the regulatory side of the issue were present at the Conference. The primary focus of the discussion was to consider how the draft IMO Convention would be implemented, and how it would affect ship recycling on an environmental and safety level. But it was refreshing to note that consideration was also given to the markets.

 

The Conference opened with a summary of the current regulatory efforts underway at the IMO. A presentation by the European Commission’s Thomas Ormond explained some of the reasons for the European activity - mainly the need for action between today and the implementation of the IMO’s legally binding instrument, the possible glut of single hull tankers being sent for recycling during this same period, and the need to deal with those ships which do not fall under the Convention’s requirements - namely warships. This presentation coincided with the adoption of the European Commission’s Green Paper (strategy) on ship recycling (see previous article).

 

Ormond’s presentation was positive in its suggestion that, first and foremost, any European activity on ship recycling would be centred on assisting with the IMO process. Having regard to some of the suggestions in the Green Paper, however, the Commission would do well to avoid duplicating efforts and even undermining some of the IMO’s activity.

 

While the key recycling states and their yards were conspicuous by their absence, some positive insight into the advances and efforts being made by yards was given by representatives of Turkish ship breakers. Dimitris Ayvatoglu from Leyal Ship Dismantling and Recycling (http://www.leyal.com.tr) was balanced in his consideration of how the IMO Convention would be implemented, explaining that it would be a welcome development for most recycling countries, which, at present, are caught between a number of differing local, national, regional and even international requirements. This situation is further complicated by a range of authorities within recycling states that claim a degree of authority over the industry. Ayvatoglu gave the example that, in Turkey, recycling falls under the mandate of the maritime, environmental and labour administrations, and that a good deal of communication is required between the three agencies and the industry to ensure that bureaucracy does not stifle the state’s commercial efforts in recycling.

 

There was also a more practical consideration given of the sale and purchase elements associated with ship recycling. Presentations from legal experts, cash buyers and owners’ representatives provided a good level of detail and understanding as to how ship recycling sales are conducted.

 

As a part of these more practical discussions, INTERTANKO’s Environmental Manager Tim Wilkins considered the future development of ‘green’ recycling capacity and went on to provide a final thought on the need to consider shipping market drivers in anticipation of any future changes in the recycling market (click here to download his presentation). Wilkins demonstrated that there is a great deal of uncertainty surrounding the scale of the single-hull phase-out in 2010 and 2015, due not only to countries opting to allow single-hull tankers to trade until the age of 25 years (or 2015 whichever comes earlier), but also to the number of conversions being undertaken, the tanker newbuilding market, oil demand and other influential factors.

 

Contact: Tim Wilkins