singapore 2013
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Singapore Market Report 2013, from SeaShip News, takes a holistic look at the city-state’s maritime and offshore industriesTRANSCRIPT
A holistic guide to shipping’s centre of gravity
Taking the pulse of maritime sectors
in the Lion Republic
Market Report 2013
An Asia Shipping Media publication
www.SeaShipNews.comSingapore
wherever you sail...
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Contents
The leading source on Southeast Asian maritime and offshorewww.seashipnews.com
EDITORIAL DIRECTOR Sam Chambers [email protected]
CHIEF CORRESPONDENT Katherine Si [email protected]
CORRESPONDENT Jason Jiang [email protected]
ECONOMISTGary Bowerman
All editorial material should be sent to [email protected] or mailed to Office 701, 9 Renmin Lu, Zhongshan District, Dalian, China 116001
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All commercial material should be sent to [email protected] or mailed to Asia Shipping Media, 20 Cecil Street, Singapore
DESIGN Tigersoft Pte LtdPrinted in Singapore
Copyright © Asia Shipping Media Pte Ltd (ASM), 2013.
Although every effort has been made to ensure that the information contained in this review is correct, the publishers accept no liability for any inaccuracies or omissions that may occur. All rights reserved. No part of the publication may be reproduced, stored in retrieval systems or transmitted in any form or by any means without prior written permission of the copyright owner. For reprints of specific articles contact [email protected].
3 LinkingBradPitttoshippinginSingapore
4 Thestateofthenationaleconomy
7 Tuasshiftfortheport
9 Howtherepublic’syardsarecopingamidstgrowingcompetition
12Shipfinanceaspirations
Majulah Singapura13 Legaldebate15 LNGhubinthemaking
17 Shipownersplatform
21 Offshoreinterviews
24 Thosewhohavejusttouched down
31 Shipmanagementmargins squeezed
32 Choppytimesforbunkering
1www.seashipnews.com
Editorial
The Brad Pitt of shipping
What’s Brad Pitt’s picture doing here
instead of your ugly editor’s mug, and
what the hell does he have to do with
our industry? Read on!
Singapore’s rise to the top table of shipping has
been well detailed; an enticing blend of incentives
has brought thousands of maritime firms to its
shores. Where it actually sits at the table is now a
hot topic. Has it even surpassed mighty London,
home to many of the top shipping organisations in
the world?
London, feeling chastened by the rise of so
many Asian maritime centres, got its act together
this September organising a highly successful
shipping week. Nevertheless, Singapore was the
elephant in the room throughout the week. Much
discussion focused on shipping centres and who
was top of the pile, something that quickly came
down to a straight shoot out between London and
the Lion Republic.
Denis Petropoulos, director at Braemar
Shipping Services, said that Singapore was without
doubt the preeminent maritime centre in Asia and
was snapping at London’s heels. He said Singapore
“has become the world’s most important shipping
centre after London”.
Nevertheless, Petropoulos had special praise
for the British capital. “London is not a maritime
capital, London is the maritime capital,” he said.
The Institute of Chartered Shipbrokers held a
seminar on the London versus Singapore debate.
Heidi Heseltine, managing director of Singapore
and London based specialist shipping recruitment
firm Halcyon Recruitment, made a very strong
case for Singapore being the main shipping hub
following the substantial growth in its shipping
sector over the past decade. However, this was not
enough to persuade the audience that London
had completely lost its crown, and Alan Marsh, the
former ceo of Braemar Shipping Services, was able
to demonstrate that key elements of the London
market will continue to play a dominant role going
forward.
Meanwhile, the chairman of the International
Chamber of Shipping, Masamichi Morooka, was
adamant that London is, without doubt, “still the
shipping capital of the world”.
Taking a sensible point of view on the debate
was Frontline’s Jens Martin Jensen, who stated:
“It’s London and Singapore, not London versus
Singapore.”
One of the world’s leading maritime recruitment
experts sees Singapore as the hottest place on the
planet for shipping at the moment.
When quizzed as to which place was the most
vibrant shipping centre in the world based on the
amount of HR movements, Phil Parry, chairman of
UK maritime recruitment firm Spinnaker, was in no
doubt. “Singapore wins through as the Brad Pitt of
shipping in the recent boom," he tells us.
London then is perhaps the Laurence Olivier in
this alternative maritime movie universe.
SeaShip News is the leading daily news service covering Southeast Asian
maritime and offshore. This publication serves as the definitive annual
on how the Lion Republic is faring shipping-wise. Contained on every
page is a useful timeline of key events that have shaped Singapore’s
shipping year. For further daily updates check www.seashipnews.com .
TheSingaporeannual
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4 www.seashipnews.com
GaryBowermangetscaughtbetweenthebullsandthebears
Economy
Mild expansion
Although Singapore’s government has been
steering the city-state’s economy towards
less turbulent waters of late, its outlook
remains decidedly cautious. In August, the Ministry
of Trade & Industry noted that “risks to the global
growth outlook” prevent a more upbeat 2013 GDP
growth forecast than 2.5–3.5%, which was slightly
revised from a previously broader range of 1–3%.
That said, a sluggish first quarter suggested
choppier seas ahead for an economy that has been
buffeted by the icy winds blowing from European
and US export markets. Singapore’s economy grew
by 3.8% year-on-year in the second quarter – a
major relief from the paltry 0.2% recorded between
January and March.
The finance and insurance sector played
a pivotal role in Q2, expanding by 13.1%.
Manufacturing growth remained slow, at 0.2%,
although that was offset against a 6.7% decline
in Q1. Construction was up by 5.1%, while
transportation and storage increased 2.5%,
following a 0.9% contraction in the previous
quarter. Total exports recorded negative growth for
the fourth consecutive quarter, although the 0.1%
drop was relatively good news compared to Q1’s
8.7% reverse.
Clouds have also hung over the stock market,
with the STI down by 1.86% year to date in
mid-September, while the usually upstanding
Singaporean dollar came under pressure, though
it admittedly fared better than its struggling
Southeast Asian counterparts. Its bumpy fall
against the US dollar began at the turn of the year,
but it recovered some ground in the first half of
September. Singapore’s deep foreign exchange
reserves and a robust current account, however,
suggest the central bank’s currency policy will not
require retouching in the near term.
The outlook for the second half of 2013 is
one of measured hope, although even the most
Analystsworryaboutthegrowthdifferentialbetweenservicesandmanufacturing
January
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Singapore’s GDP by sector, Q2 2013 v Q1 2013
Absolute Value Q2 2013 (US$m) Q1 2013 (US$m)
GDP at Current Market Prices 90,166.1 87,090.8
Goods Producing Industries 22,594.7 19,895.8
Manufacturing
Construction
Utilities
Other Goods Industries
17,548.3
3,654.2
1,365.7
26.5
15,086.2
3,653.2
1,128.5
27.9
Service Producing Industries
Wholesale & Retail Trade
Transportation & Storage
Accommodation & Food Services
Information & Communications
Finance & Insurance
Business Services
57,717.9
14,025.5
6,378.9
2,116.2
3,108.1
10,900.2
12,463.5
57,940.6
13,436.6
5,929.2
2,092.3
3,096.1
10,912.6
12,267.5
Other Services Industries
Ownership of Dwellings
8,725.5
4,058.5
10,206.3
4,015.1
Source: Singapore Ministry of Trade & Industry
upbeat analysts worry about the growth differential
between services and manufacturing. The bulls are
pinning their hopes that stronger recent industrial
output data from China, in particular, Japan and
Korea, plus increased export and import figures for
Singapore in July, are indicators of rising global
economic sentiment. Singapore’s manufacturing
output increased 2.7% year-on-year in July, while
transport and engineering output increased 13.9%,
and marine and offshore engineering posted a
19% gain, largely due to rig building and ship
conversion projects.
More positively, July saw the largest monthly
number of vessel arrivals (11,992) and shipping
tonnage (204,455,000 gt) so far in 2013, while
monthly discharged air cargo has only been
bettered once this year, in March.
Inflation is being carefully managed, despite
strong wage pressure. For 2013, core inflation is
predicted to average 1.5–2.5%, while manufactured
product prices were weighted at 97.2 in July,
compared to 100.0 in December 2012.
By contrast, bearish observers question the
validity of attributing too much value to a positive
single month – transport and engineering, after
all, posted a 2.2% decline year-on-year in the first
seven months of 2012 – and ponder from where
Singapore’s sustainable manufacturing uplift will
emerge.
The result is a mixed bag of indices that do
not fully indicate that the waters around the Lion
City are becalmed. Achieving the upper end of the
government’s 2.5-3.5% GDP growth band would
represent a healthy return from 2012’s laggardly
1.3%, but would still be well down on the 4.9% of
2011. As the Monetary Authority of Singapore noted
in early September, barring any external shocks,
steering the economy towards a “mild expansion
path” is probably the best to be expected.
TheusuallyupstandingSingaporeandollarhascome
underpressure
Economy
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FincantiericompletesbuyoutofSTXOSVMacGregortoshiftHQtoSingapore
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PSA_Powering_A4_FA.indd 1 20/3/2012 1:14:38 PM
7www.seashipnews.com
Port
Singapore’sboxportistoshifttoTuas,freeingupalargechunkofprimerealestate
Terminals, Version 2.0
In decades past when a port lost its pre-eminence
it meant only one thing, a slow, one directional
decline. Not so, however, with Singapore. The
world’s top boxport until 2010, when Shanghai
overhauled it, has not been moping about the loss
of its crown, the focus is very much on the future.
Under trying circumstances, Singapore’s port
has had a solid year with throughput in the first ten
months up 2.6% to 27.13m teu, putting it on course
to sail very close to Shanghai’s 2013 volumes,
anticipated to be in 33m teu range.
However, 2013’s volumes are insignificant
compared to what prime minister Lee Hsien
Loong has planned for the republic’s terminals –
a wholesale shift from the city centre to Tuas at
a cost estimated in the region of $8bn to nearly
double port capacity and free up 1,000 ha of prime
real estate.
Lee said this August the first berths in this
dramatic port relocation would be operational by
2022. Transport minister Lui Tuck Yew says the
new site will be able to handle 65m teu.
“Tuas provides a suitable location because of
its sheltered deep waters and proximity to both our
major industrial areas and international shipping
routes,” Lui said earlier this year.
Josephine Teo, senior minister for finance
and transport, speaking at this year’s Singapore
Shipping Association annual dinner, stressed
that the government viewed developing maritime
infrastructure and business as a priority. In the
coming decades a new airport will come up in the
east of the republic, while the port will be shifted to
the west of the country, Teo outlined.
“We will build capacity ahead of time to
ensure the maritime sector remains a very
important part of our economic landscape,” Teo
said.
Singapore upping its container terminal game
comes at a time of acute pressure for transhipment
business in the region with neighbouring Malaysia
and Indonesia both touting new port projects and
Myanmar outlining terminal plans too.
Dr Jonathan Beard, managing director of GHK
and one of the best known names in ports analysis,
sees “intense competition” in Southeast Asia for
transhipment volumes, something that is only set
to grow.
“Increasingly it is a very tough game,” he
comments. “These ports have to invest a lot but
revenues per teu are not going up.”
Indeed, the yield per teu for PSA, the dominant
port operator in Singapore, is around 50% of its
fellow Southeast Asian terminal operator ICTSI,
thanks to its heavy dependence on transhipment
cargoes, according to statistics compiled by GHK.
Wewillbuildcapacityaheadoftime
CH CHING Property developers are delighted with the port’s move from the city centre
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Singapore’stwomainshipbuildersareextendingtheirexpertiseacrosstheworld
Global footprint
Singapore’s dominant two
shipbuilding conglomerates,
both renowned for world class
operations, are building global empires.
Singapore continues to defy the odds,
churning out vast amounts of high
tech offshore infrastructure as well
as competing globally on the ship
repair front. Were the sun to set on the
republic’s shipyards, however, their
global footprint, linked invariably to
energy intensive areas, will ensure
Singaporean shipyard know-how will
continue for generations.
Keppel already has facilities in the
United Arab Emirates, Qatar, Brazil,
Azerbaijan, Kazakhstan, China, the
Philippines, Indonesia, the US and the
Netherlands – an unmatched global
reach. Nevertheless, it continues to
search for more opportunities around
the world. In September Keppel opened
a second yard in Azerbaijan in a joint
venture with the State Oil Company
of Azerbaijan Republic (SOCAR) and
Azerbaijan Investment Company (AIC).
Named Baku Shipyard, the new
62 ha yard is designed to undertake
the construction of a wide range of
specialised vessels and merchant
ships including subsea vessels, anchor
handling tug/supply vessels and
multipurpose offshore support vessels
such as platform supply vessels, as well
as tankers and cargo vessels. The yard
also has ship repair and conversion
capabilities.
Baku Shipyard adds to Keppel’s
existing footprint in Azerbaijan where it
has been operating the Caspian Shipyard
Company (CSC), also a joint venture
between Keppel and SOCAR, since 1997.
Tong Chong Heong, ceo of Keppel
Offshore & Marine, said, “The new yard
reinforces Keppel O&M’s Near Market,
Near Customer strategy and enables
us to unlock synergy in our Caspian
operations.”
In October Keppel O&M signed
a memorandum of understanding
with Mexico’s PEMEX Exploracion
y Produccion (PEP) and P.M.I.
Norteamérica, S.A. de C.V. (PMI), both
subsidiaries of Mexico’s national oil
company, Petroleos Mexicanos (PEMEX).
The MoU is to jointly develop, own
and operate a yard facility in Mexico,
the first phase of which is to support
the construction of six KFELS B class
jackup drilling rigs for PEP. To be located
strategically in the Port of Altamira along
the coast of the Gulf of Mexico, the
proposed yard will cost around $400m,
with the first phase estimated at about
$150m.
Not to be left behind is Sembcorp
Marine, which already has yard presences
in Brazil, India, the US, the UK and
China. In August the company signed
a memorandum of understanding with
Saudi Aramco and National Shipping
Co of Saudi Arabia (Bahri) to prepare
a detailed feasibility assessment on
developing a shipyard in the Arab nation.
The planned maritime yard would provide
engineering, manufacturing and repair
services to rigs, platforms, commercial
vessels and offshore service vessels.
1 3 69
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March
Shipcollision,onedeadOttoMarinegetsfirstshipordersfor2years
SecondshipcollisionkillsoneMaxHartvigsenresignsaspresidentofJayaOffshore
Keppel and Sembcorp yards around the world, including proposed ones
11www.seashipnews.com
Yards
Cheapprices,aggressivefinancingtermsandearlydeliveryslotshaveseenChinasurpassSingaporeinjack-upconstruction,writesSamChambers
Rig crown stolen
While 2013 will go down as
another very strong year for
Singapore’s offshore building
yards there is an ominous portent of
things to come, something blowing in the
wind from China.
This year has been a “momentous”
one for China’s offshore ambitions as a
mixture of available slots, cheap prices
and generous financing will see the
People’s Republic surpass Singapore
in the number of drilling rigs built,
according to research from Religare
Capital Markets. Speaking at Marine
Money’s Singapore event this September
Vincent Fernando, a director at Religare,
said China accounted for 34% of the
market share for drilling rigs in the
year to date, with Singapore on 23%, the
first time China has surpassed the Lion
Republic in this field. Korea is still top
with 41%.
“In 2013, China will have stolen the
market share crown from Singapore,”
Fernando said. This huge change
happened far faster than most expected,
he admitted.
Chinese yards are offering very
aggressive payment terms – with just 10%
needed up front, where as the best that
Singapore can offer is 28%.
Chinese prices for jack-ups have been
reported as around 30% cheaper than in
Singapore.
“Chinese yards are not focused on
short term profits. They just want to shift
the market to China,” Fernando said,
noting how since they were predominantly
state run they had very deep pockets.
This has begun to impact Singaporean
shipbuilders’ financials, with both Keppel
and Sembcorp mentioning Chinese
competition impacting margins in their
latest quarterly results.
“The downside of margins of
Singaporean yards will get worse going
forward,” Fernando said.
Audra Low, head of origination and
structures at Clifford Capital, warned that
Singaporean yards would find it “very
hard” to challenge those who are not
profit orientated.
Despite the sudden leap by Chinese
yards, quality remains an issue, said
Jesper Andresen, ceo of Axis Offshore.
“Building is much harder in China.
China is not for everybody,” he said,
Chineseyardsarenotfocusedonshort-term
profits
suggesting owners ordering in the
People’s Republic need to have extensive
shipbuilding experience and a big team
on the ground.
It is not simply down to price for this
year’s astonishing turnaround. Aksel
Olesen, managing director of Pareto
Securities Asia, maintained that investors
still favour Singapore, but the problem
is that the earliest slots of the Southeast
nation’s land constrained yards is in
2016, where as China still has 2015 slots.
Fernando concurred, saying:
“Singapore does not have the land
capacity at its yards to compete.”
Olesen maintained: “The Chinese will
dominate in the years to come.”
The leading offshore players in China
have also poached staff from Singapore
and Korea to boost their capabilities.
A silver lining was offered by Jens
Taubken, vice president at DVB bank, who
noted importantly that Singaporean rigs
command a higher price in resales.
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NOLnameslargestship,APLTemasek TanotoShipyardfire,3die
12 www.seashipnews.com
Finance
Ownerscontinuetoflocktothiscountrythankstotheeaseandspeedwithwhichcapitalcanberaised,notesJasonJiang
Readily available
Is Singapore the easiest place to raise shipping
funds in the world? The continued decamping of
shipowners to the Southeast Asian nation lends
credence to this idea. In addition to more than 20
major banks with shipping finance portfolios, there
is a wide array of alternative financing options,
including shipping trusts and listings on the
Singapore Stock Exchange.
DNB Bank’s recently appointed head of Asia,
Vidar Andersen, reckons the republic is racing
ahead of its rivals.
“I see Singapore as uniquely placed as a
global maritime hub,” he says, adding: “It covers
the whole value chain from education through
manufacturing and services to finance better
than any other city or region in the world. In
today’s market where liquidity is prevalent in
Asia, especially compared to Europe, Singapore
obviously has a stronger position also as a ship
finance hub than only a few years back.”
Comments Abhishek Pandey, head of
shipping, Southeast & South Asia at Standard
Chartered Bank: “Singapore offers a pro-
business environment given its well-regulated
banking sector, excellent infrastructure, cost-
competitiveness, highly skilled labour force, fast
business start up times, competitive tax regime,
strong investor protection and high levels of
transparency and governance.”
Manish Singh, who runs consultancy
Ideocean, notes the considerable strengths of
the wider banking sector, which ensures all
ancillary expertise are present for shipowners.
Also, important is the existence of ship finance
structuring and legal expertise along with other
functions like credit risk assessment.
To cap it off, everything is in walking distance
of each other, making sealing a deal a veritable
stroll compared to many other shipping centres.
Singaporecoversthewholevaluechainbetterthanany
othercityintheworld
UP AND UP The local stock exchange is one of the most vibrant in the world for shipping
1 5 8 1015 16 19
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April TemasekannouncescreationofLNGvehiclePavilionEnergy
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PortekbuysLatvianterminal
Uni-Asiaspends$73mon3newbuilds
13www.seashipnews.com
Law
BIMCO’sdecisiontogivethenodtoSingaporeasanarbitrationcentreayearagoisrevolutionisingthecitystate’smaritimelegalsetup
Advantage hammered home
In November last year, the global shipping
association BIMCO adopted Singapore as the
third seat of arbitration in its Standard Dispute
Resolution Clause alongside London and New
York. Singapore Maritime Chamber of Arbitration
(SCMA) rules become default procedural rules
when Singapore is selected.
“This is major game changer,” argues Lee Wai
Pong, executive director of the SCMA, “and is
expected to tilt the balance of arbitration related
work more towards Singapore from the hitherto
dominant centre of London.”
Against this backdrop, SCMA hosted its third
annual conference at the Supreme Court on 4
September to more than 150 delegates. Guest of
honour was the chief justice Sundaresh Menon
who in his keynote speech highlighted the
continued support of arbitration development by
the judiciary and legislature and provided valuable
insights for SCMA in the development of its future
roadmap. He noted the unique nature of maritime
arbitration as compared to mainstream practice
and suggested that the divergence be preserved
and further refined in order to better suit the
requirements of the maritime industry.
SCMA has seen strong growth in the number of
case references, panel of arbitrators and requests
by parties for appointment of arbitrators. The
diversity of cases registered is also spreading
beyond disputes arising from traditional shipping
contracts into contracts related to the commodities
and the oil and gas industries.
As a mark of its international acceptance,
more than 50% of the disputes registered non-
Singaporean parties. New procedures streamlining
arbitration for disputes involving collision liability
apportionment and settling of survey fees will be
launched soon.
Thisismajorgamechangerandisexpectedtotiltthe
balanceofarbitrationrelatedworkmoretowardsSingapore
fromLondon
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LNG
AfirstimportterminalinJurongisupandrunningwhileanLNGinvestmentvehiclehasalsobeenformedasSingaporelookstoleadAsia’sgasdash
Gas hub ambitions
Build it (throw in a bundle of incentives) and
they shall come has been the maxim that has
worked wonders for Singapore’s maritime
and commodities scene in the past 15 years. The
same tactics are now being lavished on liquefied
natural gas to ensure the republic becomes the
leading regional gas hub.
“In the commodity markets, location, location,
location can be more important than production—
strategically as well as geographically,” argues
June Ho, director at legal firm Pan Asia Wikborg
Rein. “Singapore understands this concept better
than most,” she continues, “and has already
demonstrated this by creating internationally
recognised hubs in insurance, financial services,
capital raising, shipping, O&G construction, and
refining. Now LNG is in Singapore’s sights.”
Singapore LNG inaugurated the city-state’s first
gas terminal this May, seven years after the plan
was first mooted. Costing an initial $1.4bn, the
facility, located in Jurong, will eventually be able to
handle 9m tons of gas a year.
What the authorities realised early on is that
building infrastructure is but one part of the
jigsaw, being a lynchpin in buying, selling and
distribution is what makes a hub. Pavilion Energy
was formed this year by sovereign wealth fund
Temasek Holdings to this end. The new firm
is headed up by technology entrepreneur and
innovator Seah Moon Ming, who joined Temasek
from ST Engineering, where he was deputy
ceo. Hassan Marican, former ceo of Malaysia’s
Petronas, has been appointed chairman.
Pavilion Energy is investing globally across
LNG-related businesses, including LNG trading
and exploration as well as storage, processing and
shipping.
“We will acquire assets across the full LNG value
chain by building strong relationships with key
partners, investing and co-investing in gas acreage,
liquefaction plants and assets, shipping and
regasification,” Seah said this September.
“I can say with confidence that Singapore will
devote itself into a major LNG trading hub soon in
the region. I believe we have what it takes to attract
growing LNG volume into Asia, and will be in a
position to set LNG prices in the region,” he added
In November Pavilion Energy paid $1.3bn for a
20% stake in three gas blocks offshore Tanzania in
East Africa.
“As Singapore continues to expand its global
presence in the marine and offshore industry and
through initiatives undertaken by the government,
we will certainly see continued growth in the LNG
market. This will provide many new opportunities
in the fields of engineering, finance and brokerage
for Singapore-based companies,” concludes Derek
Novak, vp of operations at class society ABS.
Inthecommoditymarkets,locationcanbemore
importantthanproduction
FUTURE FUEL Singapore’s LNG terminal is set to handle 9m tons a year
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Owners
SeaShipNewsmakesitaprioritytobeintouchwithtopshipownerseveryday.Belowaresomeoftheirthoughts
Opportunities abound
Kenneth Glenn,
president of
containerline
APL, shrugs his
shoulders and
looks fairly non-
plussed when asked
by SeaShip News his thoughts on how
the new P3 alliance will change his
business. The grouping of Maersk, MSC
and CMA CGM has been the container
shipping story of the year, but for Glenn
it is something he’s prepared for. “It’s
inevitable,” he says, “the whole industry is
scaling up and these days to operate you
have to have big ships.”
To this end APL took delivery this
March of the first of ten 14,000 teu ships,
which followed on from ten 10,000 teu
vessels it took in the last couple of years.
Glenn was speaking to SeaShip News
at the annual megabash that is the
Singapore Shipping Association (SSA)
dinner. Speaking at the event, having
been reelected as SSA president, senior
Evergreen employee Patrick Phoon said
shipping was in
“reasonably good
shape” despite all
the problems it
faced.
From a long
term point of
view, Phoon warned he felt the global
orderbook was still “alarmingly high”,
while scrapping was slowing down.
“Personally, I think there is too much
eco legislation coming out at the moment,”
Phoon said.
On the domestic front, Phoon said
Singapore, as a shipping hub, remained a
“very competitive” place to do business.
Elsewhere in the world of container
shipping, another senior member of the
SSA is making quite a splash.
Were Esben
Poulsson to carry
a set of cards for
all the boards and
associations he sits
on he would have
little spare space in
his hand luggage.
As well as his commitments to the
SSA, the Singapore Maritime Foundation,
the International Chamber of Shipping,
Epic Shipping, AVRA International and
Straits Tankers, the former Torm man is
chairman of Enesel Pte Ltd, a Singapore
management company for a fleet of
newbuilding containerships delivering
during 2013 and 2014.
The Singapore offshoot of the Athens-
based Enesel SA is charged with looking
after the owning companies of a series of
large boxships delivering from Hyundai
Heavy Industries. In total, Enesel has
ordered ten 13,800 teu ships, which are
going on charter to Taiwan’s Evergreen
and four 9,400 teu ships which will go on
charter to Hamburg Süd. The first ship was
named and delivered to Evergreen on 17
September.
On Enesel’s business model for
Singapore, Poulsson says, “There will not
be any speculative ordering. The company
will only order with reliable and trusted
end users secured.” Having said that,
Poulsson admits, “There is an appetite for
more.”
Top gasOne of shipping’s blue chip names, BW
Group, has undergone a remarkable
transformation since the onset of the
downturn in 2008, ditching its former
bulk reliance for a far greater exposure
to gas.
Andreas Sohmen-Pao, the ceo of the
company, casts his mind back five years
ago and compares his fleet then and now.
“We have shifted more emphasis into
gas,” he says, adding that more than 50%
of BW’s portfolio is now gas-related, the
fastest growing area of business for the
fleet.
BW Gas ordered four plus two options
of very large gas carriers (VLGCs) at
Hyundai Heavy Industries in Korea this
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Owners
August. Clarkson data puts the 84,000 dwt
quartet as due for delivery in 2015.
BW Gas’s LPG fleet is now in the throes
of an IPO in Oslo, something that is set to
land the group more than $500m.
Elsewhere in the Singapore LPG
landscape, Petredec, one of the world’s
largest LPG traders, is moving its sights
towards more downstream and storage
operations as it gears up to be a full LPG
logistics leader. Founded in 1980 Petredec,
now shifting more than 12m tons annually,
is in a period of rapid expansion. Its fleet
consists of 18 owned ships, two bareboat
chartered, five on order and 32 on time
charter. Giles Fearn, chief executive, says
more newbuild orders will follow.
“Petredec is in
a period of high
investment in
both shipping and
downstream/storage,”
says Fearn, adding:
“We are looking to
build with all sectors of the LPG shipping
market.”
“The LPG market is in a state of
revolution,” Fearn says confidently. “New
supply is constantly being discovered
most notably in the US with its huge shale
gas finds. The fundamentals would appear
to be positive, but as with every shipping
sector it is cyclical. Margins are high
currently and therefore outside investors
are entering the newbuild market. This will
lead to a fall in margins further down the
road.”
New bulk contendersNicholas Fisher will
use his experience
gained in diversifying
Oman Shipping
Company to broaden
the revenue base for
Singapore’s Masterbulk, having taken on
the ceo role a couple of months ago.
“Diversification in dry bulk activities
will be key for Masterbulk’s business
going forward,” Fisher says.
Plans for the medium term include
strengthening the company’s position in
the forest products market.
Masterbulk owns 20 open hatch gantry
crane-equipped vessels, 16 of which are
technically managed through its own
shipmanagement activity in Singapore,
and four of which are managed through
Westfal-Larsen Management in Bergen.
On the markets, Scandinavian Fisher is
cautiously confident, saying: “Indications
are that a gradual recovery is around the
corner.”
Another Scandinavian firm, Stena
Bulk, is among the most active bulk-wise
in the Lion Republic. In February, Stena
Bulk and Indonesia’s Golden Agri-
Resources (GAR) set up a product tanker
joint venture, Golden Stena Bulk. The jv
has since ordered six product tankers at
Guangzhou Shipbuilding International.
In June 2012, Stena Weco – the joint
venture between Stena Bulk and Danish
Dannebrog – formed a 50-50 joint
venture with GAR. The joint venture,
Golden Stena Weco, was aimed at
providing an overall solution for GAR’s
international transportation of its palm oil
products.
“Golden Stena Bulk can be seen as the
second step in our collaboration with
leading palm oil plantation company, GAR.
For us, it’s also a gateway to Asia,” says
Erik Hanell, president and ceo of Stena
Bulk. “Such strategic partnerships are
a well-tried concept for us and involve
coordinating complementary assets,
know-how and experience. With GAR’s
robust network and intimate knowledge of
the region, this strategic partnership gives
us greater access to the Southeast Asian
market as well as to local competence.”
In other Stena news, Erik Lewenhaupt,
general manager and head of Stena Bulk
Singapore, is to leave his post in the Lion
Republic after 6.5 years to go back to
headquarters in Gothenburg in Sweden.
Lewenhaupt, a well known face among
Singapore shipowners, will take on a
senior marketing and communications
role within the group.
As a replacement Stena has hired
Nicolas Duran, former head of sale and
purchase for Fearnleys Singapore.
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Offshore
SoutheastAsiaremainsoneofthefastestgrowingplacesforoffshoreoperators.SeaShipNewspridesitselfonitsaccesstoleadingplayersinthesector,aswitnessedoverthenextcoupleofpages
Red hot
Stock exchange announcements are
testament to the booming oil and gas
scene in the region, with not a day
going by without some big new deal signed
or local offshore players celebrating
record results.
The region is one of the hottest for
offshore developments in the world.
Thailand and Malaysia are deemed
especially scorching areas for the
booming offshore support vessel (OSV)
market, says one of the region’s top
brokers. Mike Meade, ceo of Asia’s largest
independent offshore brokerage, M3
Marine, reckons the capital expenditure
for exploration and production (E&P) in
Asia will grow by 53% between 2013 and
2017, with an “above average spend” in
India, Malaysia and Indonesia.
“We are seeing an increase in activity
across the board,” he says, “with notably
jack up utilisation - and rates - increasing
and the subsea sector described by many
as hot.”
Setting his sights high, Marco Polo
Marine’s ceo has outlined plans to become
a “significant” group in offshore oil and
gas marine logistics and support in the
region.
What’s more, Sean
Lee says he has “plans
and the wherewithal”
to be one of the
larger offshore
support vessel (OSV)
owner-operators in
Indonesia, specifically in the mid-sized
anchor handling tug supply vessel (AHTS)
segment where he says his company has
the “early-mover advantage”.
Marco Polo Marine has 11 sets of
tugs and barges and four OSVs while
its Indonesian subsidiary, PT Pelayaran
Nasional Bina Buana Raya Tbk (PT BBR)
has 35 tugs, 32 barges, one self-propelled
barge and three OSVs. PT BBR listed on
January 9 this year.
With regard to ship chartering, the ceo
says Marco Polo Marine will still be active
in Asian and Australasian waters including
Thailand and Australia – “our bread and
butter” – as well as exploring new projects
in Malaysia, Vietnam and Myanmar.
Back of the net for ChellseaChellsea, one of Singapore’s newer
entrants into the offshore support vessel
(OSV) scene, is undergoing a period
of significant expansion. Part of the
Kishinchand Chellaram (KC Group)
of shipping companies, Chellsea was
set up by Gautam Chellaram two years
ago as part of the group’s strategic
diversification, with, he says, modestly, “a
blank piece of paper”. Said blank piece of
paper has since transformed into a fleet
on a rapid rise. “Our focus is on building
the infrastructure,” says Chellaram.
The Chellarams
traditionally have
focused on dry bulk
via Hong Kong’s KC
Maritime, but saw
the coming offshore
explosion and bought
a platform supply vessel in 2011, kicking
off new firm Chellsea. A sister ship was
added last year. Both ships are “high
quality”, stresses Chellaram, and aimed at
the North Sea market.
“The strategy for Chellsea in ordering
these vessels,” says Chellaram, “is to order
16 19 21 2224 27
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23www.seashipnews.com
high spec and build quality vessels, with
a focus on winning long-term business.
There is no compromise in quality, which
is what will win us long-term business with
oil majors.”
The Chellarams
would do well to take
heed of the thoughts
of Indonesian
national Rony
Sudjaka, the chairman
and md of Singapore-
based OSV specialist
Pacific Richfield Marine and arguably the
man with the longest and broadest OSV
experience in the world.
Wearing a trademark cap Sudjarka says
of the firm that he founded in 1989 that
while there is plenty more competition
in his sector all of a sudden he is not
worried as the ships he builds and owns
are “higher class” with big engines and
more back up systems. Sudjaka has a long
history of building OSVs, but had quit
the practice for a number of years before
returning to it in 2008, when he found he
was unable to get ships built at other yards
because they were so busy. He made the
decision to rent a yard in Singapore and
started churning out high spec ships.
Sudjaka now owns 55 ships. His
shipyard has one dock and is able to build
eight ships every 18 months.
Sudjaka’s father worked in Hong Kong
at the old Taikoo Shipyard from 1926,
before moving back to Indonesia to do
contracting work. Sudjaka himself, now
77, has been in the OSV business now for
more than half a century.
Making headlinesIn the news more
than most this year
on our site has been
Singapore’s offshore
contractor Otto Marine,
for better and for
worse. Garrick Stanley
has been in the role of group ceo for just
over four months now trying to continue the
process of making the firm more profitable
with an eye to increasing the company’s
fleet of offshore support vessels.
Stanley joined Otto subsidiary Go
Marine Group back in 2007 as managing
director and has over 18 years experience
in the industry.
The shipyard has been through a “cost
cutting and efficiency consolidation stage
whereby fats are trimmed and resources
redeployed,” Garrick says. Nevertheless, the
upshot is that the yard is now ready to take
on new projects, it bagged its first orders
for two years towards the beginning of the
year, for instance, and has received further
deals since.
Garrick is keen to portray the group’s
full range of offerings beyond just the
shipyard.
“The company has definitely developed
into a marine services company with a
shipyard,” he stresses.
“Our shipping business has now
refocused to renew, expand and upgrade
our own fleet whilst the shipyard increases
our offshore fabrication capabilities and
ship repair,” Garrick explains.
Group revenues are currently
dominated from Otto Marine’s fleet of 63
vessels operating around the world.
“We are seeing an increase in demand
for our fleet and increasing day rates and
utilization,” says the new ceo.
Finally, in our offshore roundup we
come to Nordic Maritime, one of myriad
Scandinavian shipping companies that call
Singapore home. The offshore specialist
is increasingly carving a niche out of
Indonesia to cement its strong Southeast
Asian business.
Founded in 1999, Nordic Maritime now
operates seven vessels – both owned and
under third party management. The fleet
is made up of five seismic vessels and two
survey/chase support vessels.
There’s also a DP2 multipurpose supply
vessel under construction for delivery
late this year plus two DP2 400-men
accommodation/construction vessels
coming into the market next year.
Also of interest
being built is a
catamaran hybrid
design under
construction for
seismic support
operations which is
due out in the third quarter of next year.
“This is an exciting project which can be
very interesting for the Southeast Asian
market with a low fuel consumption and
high functionality to support the seismic
survey vessels,” claims Kjell Gauksheim,
Nordic Maritime’s ceo.
Gauksheim, who joined Nordic Maritime
in 2006, says the plan going forward is
to grow the company’s seismic and DP
accommodation fleets.
“For certain OSV vessels the market
is already facing an overcapacity and
supply,” he says, concluding: “However, we
are very focused on our two segments and
have strong belief in these.”
Offshore
12
5 6 9 1215
AUGUST
SwibercompletesdebutSingaporedollarsukuk
YangzijiangShipbuildingfirstcompanytolaunchdualRMBtradingatSGXGarrickStanleynewceoofOttoMarine
Macquarietakes45%stakeinHeliosTerminal
24 www.seashipnews.com
SeaShipNewschecksoutwhohasmadeasplashintheLionRepublicthisyear
New Entrants
Making the cut
Singapore plays home to arguably
more senior positions in shipping
than anywhere else on Earth. Its
business friendly, incentivised maritime
environment sees business class
planeloads regularly touching down to set
up shop in the Lion Republic.
Among the highest profile switches
was in the middle of the year when Ken
Cambie, former chief financial officer
of Hong Kong’s OOCL, joined Quantum
Pacific Shipping Services as finance
chief. Quantum Pacific is a new maritime
venture created by Israel’s richest man,
Idan Offer, headquartered in Raffles Place
in the heart of Singapore.
Quantum Pacific has been formed
to handle various divisions of the Ofer
shipping empire, including overseeing the
existing Tanker Pacific fleet along with
ships transferred from Zodiac.
Epic gas creation
The Lion Republic has a new gas carrier
operator following the merger this January
of Epic Shipping Holdings and Pantheon.
The new creation, Epic Pantheon
International Gas Shipping, has, including
vessels on order, a very rapidly built up
fleet of 31 ships.
It has significant new backers
including Jeffries Capital Partners, DVB
Bank and Diamantis Pateras Maritime. The
company also has investment from one
of the region’s canniest shipping players,
former Pacific Basin boss, Chris Buttery,
who in November became chairman of the
company. In May, Epic appointed shipping
industry veteran Lars Vang Christensen as
its new ceo.
MOL bolsters presenceEmploying more and more people in
Singapore is one of the world’s largest
shipowners, Japan’s Mitsui OSK Lines.
Speaking on the occasion of MOL’s
129th anniversary in April, the president
of the Japanese line, Koichi Muto, was
fulsome in his praise of business in
Singapore.
In January 2013, MOL transferred its
16 192120 22
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Russianjailedinlatestbunkerscandal
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25www.seashipnews.com
dry bulkers to Singapore, a place Muto
described as “a key hub of customers and
information”.
“The move to Singapore has restored
cost competitiveness to the dry bulker
fleet, which had been operating at a loss,
laying a strong foundation for restoring
profitability,” Muto said.
Looking ahead, the MOL boss added:
“We will accelerate business expansion
from our hub in Singapore through
business reforms designed to capture
growth primarily in emerging markets.”
At a cocktail reception it organised
in November, MOL said it was likely to
transfer a significant tranche of its tanker
fleet to Singapore too.
Maersk, Singapore’s largest owner
A.P. Moller-Maersk, famous
for its containerline switching
ports from Singapore to
Malaysia over a decade ago, is
already the largest shipowner
by fleet size in the Lion Republic,
and is set to get a whole lot
bigger here.
Singapore is
now the company’s
biggest base outside its
Danish headquarters.
According to
Bloomberg,
Maersk has around 120 ships under the
Singapore flag, the most after 180 in
Denmark.
Most of Maersk Line’s large orderbook
of newbuilds are set to fly the Singapore
flag, according to Thomas Knudsen,
president of Maersk Line Asia Pacific.
“There’s a maritime cluster around
Singapore where you have access to
pretty much all the different aspects of
shipping,” Knudsen told Bloomberg. “The
last five years we have really cleaned up
to concentrate on fewer flags to get the
economy of scale. You can definitely get
lower cost if you go to Panama or Liberia,
but we feel that Singapore is a good
combination of cost and quality.”
Grieg Star in the ascendant
Grieg Star is part of the privately owned
Grieg Group and is a fully integrated
shipping company and owner of one of
the world’s largest open hatch fleets. On
July 1 the firm opened a branch office,
Grieg Star Shipping Singapore, headed up
by Audun Baardensen.
In addition to operating one of the
largest open hatch fleets in the world,
Grieg Star also operates about 15 - 20
geared bulk carriers in the supramax
segment through Grieg Star Bulk.
Grieg Star Shipping Singapore is the
company’s branch office and “lengthened
arm”, according to Baardensen, in
Southeast Asia, carrying out all kinds of
marketing, operational and commercial
services.
“We intend to establish
ourselves in Southeast Asia
by keeping in close
touch with existing
and new
customers and clients,” Baardensen tells
SeaShip News.
Crowley’s local solutionsThe solutions group of America’s Crowley
Maritime Corp is opening a project
management office in Singapore and
building two new heavylift deck cargo
barges for dedicated use in the region.
The company also has an option for the
construction of two additional barges.
“This move not only allows us to
broaden our geographical reach, but
will also allow for more efficient turnkey
solutions within the areas in which our
customers are focused,” says Craig
Tornga, Crowley’s vice president of
solutions. “It is also important for us to be
able to support the operation and market
growth with dedicated equipment, which is
why we are investing in the construction
of two new barges for the region.”
Rickmers goes it aloneAt the start of the year Rickmers-Linie
established a new company – Rickmers-
Linie (Singapore) – to strengthen its
presence in Southeast Asia. The new
company, which has taken over all
responsibilities for Rickmers-Linie’s
activities from its former agents, Horizon
Shipping, is operating out of offices co-
located with Rickmers Shipmanagement at
11 Keppel Road. Rickmers-Linie’s ceo is
the former head of Neptune Orient Lines,
Ron Widdows.
Wallem takes aimLeading Hong Kong shipmanager Wallem
set up a new shipmanagement operation
in Singapore that complements its long
standing ship agency business and the
recently formed NW Ship Management
company. “This will double the size of
New Entrants
1 5 10 15 20 25 306 9
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Wallem’s business in Singapore during
2013 and will be adding many new jobs to
the local maritime sector,” a spokesperson
in Hong Kong said.
The new shipmanagement operation
commenced operation in April with all
Wallem businesses in Singapore moving
into one office in Alexandra Road.
Wallem has had a presence in
Singapore for more than 50 years as
a leading ship agency and logistics
company.
Offshore developmentsIn March Halliburton opened its newly
constructed Completion Technology and
Manufacturing Center in Jurong.
“Halliburton is the leading supplier of
completion products and services globally,
and the Singapore facility is a flagship for
our Completion Tools manufacturing in
the Eastern Hemisphere,” says Dave Lesar,
Halliburton chairman, president and ceo.
The new state-of-the-art facility is
located on about 43 acres in Jurong
Industrial Park and includes more than
500,000 sq ft of manufacturing and
administrative space.
Australia’s Toll Group opened its
redeveloped S$300m Offshore Petroleum
Facility in May, describing it as “an
effective interface between air, land and
sea for companies in the marine, offshore,
oil and gas industry”.
Meanwhile, the MacArtney Underwater
Technology Group has opened a new
group subsidiary in Singapore.
MacArtney Singapore offers local
access to extensive stock and capacity,
giving prompt delivery to underwater
technology customers in Singapore,
Malaysia, Thailand, Cambodia, Vietnam,
Brunei, Indonesia and the Philippines.
Norwegian offshore broker Westshore
has created a joint venture with Raffles
Shipping Projects forming Westshore
Raffles. The operation is headed up by
Norwegian national Alexander Pettersson.
Initially Westshore Raffles’ focus will
centre around sale and purchase and
newbuildings. Eventually chartering will
also be included. Westshore already has
offices in Norway and Brazil.
“One of the main reasons for this
step was to provide the link between
Asian shipbuilders and investors and the
abundance of activity in Brazilian waters,”
comments Sølve Høyrem, Westshore’s
managing director. “Great synergies can
be seen between these two markets. In
addition to this the offshore market has
become more global and competitive than
it was 12 years ago. This has being clearly
demonstrated by Asian shipyards that are
now in a position to actively compete with
European yards on most levels."
Redolent of the booming offshore
scene in the region Australia’s Energy
Human Resources formed this June Energy
HR Asia Pacific, a joint venture with the
M3 Marine Group, based in Singapore.
Energy HR Australia, founded by
Sarah-Jeanne Fraser in 2008, has come
up with a “unique fee structure and
business model”, the company said in a
release, which has proven popular across
Australia. The same model is now coming
to Southeast Asia.
Service providersA leading UK private maritime security
company (PMSC) that has set up in the
Lion Republic tells SeaShip News that
shipowners in the region need to watch
out for myriad firms who are charging
incorrectly for their protection services.
Freddie Hall, who relocated in April
as business development manager for
REDfour Maritime Security Solutions in
Singapore, warns: “Reputable PMSCs are
aware of the need to limit costs and will
work with clients to achieve this. However,
it’s important to keep in mind that there
are some providers that are quoting
unsustainably low in order to win transits
and it’s these, less reputable companies
that can cause problems.”
On the rationale to set up an office in
Singapore at Suntec City to go alongside
REDfour’s hq in London and its Sri
Lankan outpost, Hall notes the “seeping
migration” of shipmanagement from the
UK towards Asia.
International Paint, part of AkzoNobel,
the world’s largest paints and coatings
company, officially opened its new
global marine coatings headquarters in
Singapore this February.
Elsewhere, Martek Marine ceo Paul
Luen outlined growth plans including a
new office in Singapore. The tech firm
plans to double in size over the next
three years with a key component being
the expansion of Martek in Singapore by
moving into new, larger premises.
Geir Sjurseth, managing director
of DVB bank’s offshore division, who
moved to head up the bank’s Singapore
operations this year, is bullish on offshore
as a whole.
“In particular subsea and construction,
drilling and floating production see good
prospects,” he tells SeaShip News.
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- a solid and dynamic partner
griegstar.com
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OctoberVallianzHoldingstiesuphuge$334mSaudideal
Canada’slargestagribusinessRichardsonInternationalsetsupinSingaporeDNVPetroleumServicestakenoverbyEuropeanprivateequityfirmIKInvestmentPartners
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New Entrants
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Maritime CEO Ad.indd 2 13/8/13 6:41 PM
29www.seashipnews.com
“It has become evident over the years
that the offshore industry is driven by very
different demand drivers versus traditional
sea going shipping transportation,”
Sjurseth says, adding that the size of DVB’s
offshore business has grown relatively
more than conventional shipping, thus
justifying a separate division. The bank’s
offshore division caters to the OSV market,
subsea, construction vessels, seismic
operators, accommodation units, drilling
and floating production units.
One of the region’s best-known names
in the lubes industry made a return to
the sector this year. Caroline Huot’s work
has seen her head up lube sales for top
names such as Total and Gulf Oil Marine.
Now, after a stint in Africa with UBI Oil,
she has returned to Asia, to Singapore
where bunkering giant KPI Bridge Oil has
tasked her with setting up a global lubes
operation.
“Lubes require a different type of
relationship with customers as it’s a much
longer term business,” Huot tells SeaShip
News. She will be bringing in a specialised
team as well as using KPI’s existing
network.
Similar to what she created at Gulf
Oil Marine Huot is determined to build a
global network offering 24/7 service.
Lubes are the fourth biggest expense
for owners after bunkers, crew and
insurance, Huot claims.
Lifting upIn a big shift for one of Europe’s best
known marine equipment manufacturers
MacGregor moved to Singapore. The
subsidiary of Finland’s Cargotec is
increasingly focused on the Lion
Republic.
“Due to its closeness to our Asian
customers and partners, we are confident
that Singapore is the best location for
the domicile. Since more than 70% of
MacGregor’s sales are already generated
in Asia Pacific, we feel that establishing
our domicile in Singapore would
represent a natural development for our
operations,” comments Mikael Mäkinen,
president of MacGregor.
Cargotec is proceeding with listing
its marine division on the Singapore
Exchange. Moreover, it has just
announced that it will look to list
MacGregor, best known for its ship
cranes, in Singapore too, subject to market
conditions.
In January Cargotec tapped Finnair for
its new ceo to replace Mikael Maekinen
who moved to Singapore in October last
year to lead the company’s Asian listing
likely to take place next year.
Another leading crane manufacturer,
Austria’s Palfinger, is raising its presence
in Singapore.
“We are currently working on a new
Singapore setup which will cover the
whole Asia Pacific,” Karl Oberreiter, head
of Palfinger Marine, tells SeaShip News.
Class growthClass society ABS is upping
investments in Singapore
that will strengthen engineering and
survey capabilities and lay the foundation
for strategic global initiatives. ABS is
expanding its operational workforce,
increasing research and development
(R&D) efforts and establishing a Global
Performance Center in Singapore.
“ABS has worked alongside industry,
academia and government in Singapore
for more than 50 years,” says ABS
president and ceo Christopher Wiernicki.
“We are moving in step with Singapore
as it continues to expand its presence in
global trade. These investments represent a
continuation of our long-term commitment
to Singapore, elevating its significance as
an integral part of ABS’ future.”
ABS will create its Singapore
Innovation and Research Center (SIRC).
SIRC will expand R&D activity to include
marine operations and performance
management.
Meanwhile, FutureShip, Germanischer
Lloyd’s (GL) maritime engineering and
consultancy subsidiary, announced the
unveiling of its ECO Research Centre
in Singapore this May. The centre aims
to conduct research to strengthen
FutureShip’s energy efficiency solutions
for its Asian clients.
Finally, there’s news that Singapore-
headquartered DNV Petroleum Services
(DNVPS) has been taken over by European
private equity firm IK Investment Partners.
Founded by Norwegian classification
society DNV in 1981, DNVPS is a global
provider of fuel management services for
the maritime and power sector. DNVPS,
this May, set up a dedicated laboratory to
focus on R&D and specialised tests.
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October MiclynExpressOffshorebuys50%ofthesharesinThailand’sUniwiseTowagefromSvitzerAsia
NTUannouncesitisestablishinganadvancedmaritimeenergytestfacility
New Entrants
When four cruise ships had to berth in Singapore in a single day.Wallem delivered.
www.wallem.com
Delivering Maritime Solutions
31www.seashipnews.com
ManagingshipsoutoftheLionRepublicisincreasinglytrickyfromaprofitpointofview
Cost issues
Shipmanagement, a fine margins game at the
best of times, is being squeezed ever more in
Singapore. That has not stopped the republic
seeing the number of shipmanagers increase, but it
certainly has many on edge. The fact is; Singapore
is expensive.
Office space, for instance, in Singapore’s central
business district is the eighth most expensive
in the world and nearly as costly as midtown
Manhattan. And there is likely no let up here with
Macquarie Research forecasting Grade A rent to
rise 5% next year to S$10 per sq ft per month.
Similarly salaries are a major issue. Pay for
well qualified shipping practitioners now easily
surpasses Hong Kong and most other Asian cities.
Once again, there’s bad news on this front too with
two separate recent surveys suggesting the average
Singapore salary will rise by 4.5% next year.
Phil Parry, chairman of UK maritime recruitment
firm Spinnaker, says: “Singapore has become a
victim of its own success in that the huge growth in
the number of shipping employers there has led to
a war for talent.”
Summing up the republic’s HR issues, Parry
says: “Singapore’s problem is that with so many
newly landed companies, demand for locals or
foreigners with existing permanent residence
outstrips supply. Something has to give and that’s
either in the way of salary inflation or conceding
that sometimes it’s necessary to look overseas for
staff.”
Manish Singh, chairman of consultancy
Ideocean and former high flier with V.Ships, says
the rapid escalation in costs means managers must
seek back office solutions elsewhere in places
like India or the Philippines. The intensifying
scramble for a limited supply of local talent is also
a headache for managers, he says, something that
has not been helped by a slight tightening in the
country’s immigration policy.
For Simon Doughty, the head of Hong Kong’s
Wallem Group, competition is the biggest challenge
in Singapore, a country Wallem has significantly
bolstered its presence in this year.
“There are many shipmanagement companies in
the island vying for the same business,” he says.
Wallem’s head in Singapore, shipmanagement
veteran Deepak Honawar, says the cost of living
in the republic is now higher than other maritime
cities such as Hong Kong, Hamburg and Athens.
Nevertheless, new entrants continue to roll in.
Theintensifyingscrambleforalimitedsupplyoflocaltalent
isaheadache
Shipmanagement
SKY HIGH Singapore office rental prices are now on a par with Manhattan
When four cruise ships had to berth in Singapore in a single day.Wallem delivered.
www.wallem.com
Delivering Maritime Solutions 1 42 35
November PacificBasinfoundersChrisButteryandPaulOverjoinEpicShippingTanBoyTeebuysintoVikingOffshoreandMarine
PSAbuysastakeintheChineseportofLianyungang
SembcorpMarineofficiallyopensfirstphaseofitshuge206hayardinTuasBalticExchangeholdsfirsteverboardmeetingoutsideoftheUKinSingapore
32 www.seashipnews.com
Bunkering
Atrickyyearformanyhasseenthenumberofbunkersupplierscontract,writesKatherineSi
Mixed bag
Singapore, the world’s largest
bunkering hub, has seen the sector
contract considerably this year. The
number of companies now licenced by the
Maritime and Port Authority of Singapore
(MPA) has slipped by around 10 this year
to just over 70 bunker suppliers. This was
a result of certain firms failing to adhere
to the MPA’s terms and conditions while
others simply did not renew their licence
as competition and operating conditions
have been fierce of late.
Due to slack demand and extortionate
storage prices many bunker traders in
Singapore are seeking alternative places
to carry out their business.
Both BP and Swiss trader Gunvor
Group are giving up their fuel oil storage
space at the giant 2008-opened Universal
Terminal in Singapore. With VLCC rates
so low, and Singapore land prices so
astronomical many are choosing storage
at sea while others are looking at Malaysia
to set up shop.
However, there have been others who
have strengthened their position in the
Lion Republic this year. A good example is
Dynamic Oil Trading, the lube and bunker
firm, which celebrated its first anniversary
this October.
In the 12 months since its
establishment, Dynamic Oil Trading has
expanded rapidly and now has a ten-
strong bunker trading team based out of
its global headquarters in Singapore. The
company is also launching a new office in
Dubai to serve its customers in the Middle
East with plans for further expansion in
Asia and Europe.
New bunker players that came to
Singapore this year include Pacific
Bunkering and Norwegian Oil Trading
(NOT), the latter majority owned by Hesnes
Holding and NYK Trading Corporation.
ManybunkertradersinSingaporeareseekingalternativeplacesto
carryouttheirbusiness
Singapore has made progress in the
development of the practical operational
procedures and standards for LNG
bunkering operations.
The Maritime and Port Authority
of Singapore (MPA) and its appointed
consultant, Lloyd’s Register, have
completed a study on the technical
standards and procedures for LNG
bunkering in the port of Singapore.
Following the completion of the
study, MPA will be organising industry
consultation sessions to share the
results of the study with the maritime
industry and seek their feedback.
With the industry feedback, MPA will
subsequently finalise the LNG bunkering
standards for the port of Singapore.
“There is an increasing need for the
shipping industry to look at alternative
sources of fuel and LNG is a promising
option that we should consider. The
completion of the study is an important
milestone in the development of LNG
bunkering in the port of Singapore and
we would like to share this significant
progress with the industry,” said Captain
M Segar, MPA’s assistant chief executive
(operations).
LNGplans
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PavilionEnergyspending$1.3bnfora20%stakeinthreeblocksoffTanzania
KreuzHoldingsandasubsidiaryoftheHeadlandPrivateEquityFundconcludeamanagement-ledleveragedbuyoutofKreuzHoldingsforS$446m
PacificRadianceIPOnets$154.7mNovember
For more information, please visit:Anastasia EmelianovaT: +44 207 596 5011E: [email protected]