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Kinnock hails tanker owners

Kinnock hails tanker owners

Lloyd's List Tuesday October 20 1998No. 57,096Page 5
Tel: +44 171 553 1000

Kinnock hails tanker owners

Intertanko has earned respect for its high standards, but for how long?

Tony Gray assesses the implications of last week's Intertanko Brussels Tanker Event

IT'S official - tanker owners are a good thing. European transport commissioner Neil Kinnock more or less said as much when delivering a ringing endorsement of the industry's efforts to raise safety standards through Intertanko.

"I am sure that Intertanko will maintain its invaluable commitment to the Quality Shipping Campaign," the commissioner told an appreciative audience of Intertanko members.

"Indeed, I can foresee even stronger links between our two organisations developing as the campaign advances. I look forward to that."

Kinnock: recognition

Mr Kinnock's praise for Intertanko's work was returned in full by the independent tanker owners' organisation.

"We fully support his goals," said Richard du Moulin, chairman of the independent
tanker owners' organisation.

"We look forward to strengthening our ties with the commission in the years

Slater: essential role

This mutual admiration society came dangerously close to smugness. And a timely warning against hubris came with last week's allegations that a vessel operated by Intertanko member Pegasus had spilled 2,300 gallons of oil in the sensitive San Francisco Bay area.

But tankers owners have earned the respect of regulatory authorities, and it would be churlish to darken their moment in the sun.

For too long, the industry was considered public enemy number one, endangering the seas and wildlife with old rustbuckets and poorly-trained crews

du Moulin: strengthening ties

In recent years, however, the industry's safety record has come on in leaps and bounds.

These days articles in the press about pollution are more likely to be detailing the misdemeanours of cruiseships rather than tankers.

And the tanker industry's performance must now be the envy of colleagues in the dry bulk sector, whose ships continue to sink with alarming regularity.

Cynics may argue that tanker owners had to be kick-started by US legislation and charterers' inspection regimes, but Intertanko clearly deserves much of the credit for the industry's improved reputation.

Its quality criteria for membership rests on three substantial pillars. Members must have:
pollution insurance through a recognised P&I club; l classification by a member of the International Association of Classification Societies; and ISM Code certification.

Intertanko is entitled to take pride in the fact that all its members were ISM-compliant by the time the code entered into force on July 1, 1998.Of course, not all tanker owners are members of Intertanko, but the number of rogues violating the rules must now be quite small.

Intertanko embraces a substantial 74% of all independently-owned tanker tonnage. Add the three large fleets of non-members Frontline, World-Wide and Maersk, it is clear that at least 80% of tanker tonnage is being operated within the framework of high safety standards.

Mr Kinnock's positive remarks are an important recognition by the outside world of the industry's achievement.

And Intertanko and the commission are like-minded in their determination to raise the industry's profile.

Shipping remains an intensely private industry, both in terms of its ownership and operations.

The result is that shipping is rarely at the centre of attention unless tragedy strikes.

Mr Kinnock wants this to change.

"I believe it is essential to increase the visibility of shipping as a means of emphasising its crucial importance to every economy and in order to help to shape public policy.

"The reason is simple. It is much more likely that there will be greater efficiency in the other parts of the transport chain which connect with shipping and better standards of infrastructure and services that relate to shipping if there is a general public and political awareness of the real significance of shipping for economic performance and civilised social and living conditions."

Given we have for decades been living in what could legitimately be dubbed the 'age of oil' the tanker industry's low profile does appear anomalous.

Any doubts about the vital role tankers play in keeping our lights on and our cars motoring were met head on by Paul Slater, the chairman of Intertanko's public relations committee.

The tanker industry was, he said, "arguably the single most important activity in the lives of every European citizen".

Mr Slater's words focused on Europe because the Intertanko conference was designed around its relationship with Brussels. However, they could equally apply to other regions of the world.

Indeed, Mr Slater's speech, which attempted to do justice to the "essential role" of tanker transportation in Europe's economic framework, appeared to be directed at a wider audience than those members of the tanker fraternity which largely comprised his audience.

He produced a host of eye-catching statistcs regarding the oil and tanker industries which surely could not have failed to impress even the most hard-core environmentalist or government official.

Oil is the world's most strategic commodity, accounting for 40% of total world energy consumption.

Crude oil and oil products represent no less than 45% of global seaborne trade, employing 3,400 tankers of more than 10,000 dwt.

Impressive figures, but by no means new.

The novelty of Mr Slater's speech came in the number-crunching he and Intertanko had done on tax revenues associated with crude oil imports. Incredibly, a 280,000 tonne crude cargo worth around $19m will have $115m in tax added to it by the UK government before the refined product reaches the consumer. Suffer the poor

Mr Slater continued: "In a full year, the UK government generates some $21bn in tax on imported crude oil and we estimate that the total annual tax revenue raised in Europe by the importation of crude oil is more than $200bn.

"I could argue that we tanker owners don't simply carry oil, we carry tax revenues."

Jokes about VLTCs - very large tax carriers - aside, it would need only a small chunk of this tax revenue to be ring-fenced for supporting the tanker industry to further improve the overall safety record.

Mr Slater offered a rollcall of the shore-based services beyond the owners' control that also need to be performing up to scratch if accidents are to be avoided:

pilots properly trained and certified; accurate charts and properly dredged channels and harbours; vessel traffic information and control systems; sufficient tugs with sufficent power; adequate accident response programmes and facilities; slop reception facilities; and uniform enforcement of existing rules and regulations.

Mr Slater concluded: "Given the financial aspects of each voyage it is essential that all of these services and facilities are available in every European port and waterway and we believe that by protecting the flow of tax revenues we will automatically protect the environment."

Intertanko is right to press home the importance of raising the quality of shore-based functions.

As Mr Slater pointed out, the Sea Empress spill in Milford Haven in 1996 demonstrated that an owner can operate quality tonnage with a highly-trained crew and yet still be vulnerable to the effects of shore-based inefficiency.

Having got its own house in order, the organisation is entitled to demand that others do too.

Mr du Moulin said that tankers now account for less than 5% of port state detentions, and that Intertanko members were responsible for 25% of these - or not much more than 1% of the total.

The organisation is aware of the need to be ever-vigilant, however.

Just one major oil spill in which an Intertanko member has been shown to be negligent could undo all the good work.

LLP Limited 1998