INTERTANKO An Introduction & Key issues facing the tanker industry today Presented by John C. Fawcett-Ellis Legal Counsel & Regional Manager Asia-Pacific Dalian, 24 June 2004

- representing responsible oil and chemical tanker owners worldwide - promoting Safer Ships, Cleaner Seas and Free Competition

-strict membership criteria based on quality and performance

The International Association of Independent Tanker Owners INTERTANKO today 240 Members 240 Members 2,200 tankers 2,200 tankers 160 million dwt 160 million dwt Average age: 13.5 years Average age: 13.5 years 270 Associate Members 270 Associate Members 27 Staff / 6 Consultants 27 Staff / 6 Consultants OsloLondonSingaporeWashington

INTERTANKO in Asia - Pacific Membership - Australia – Botany Bay Shipping Group - China – Hebei Ocean Shipping Co, Cosco Dalian (Ass. Member), China Shipping, Nanjing Tanker Corporation & Sinochem Shipping - Hong Kong – Anglo-Eastern, Associated Maritime, Eurasia, Fairmont, HK Ming Wah, Parakou, TCC, Unique, Wah Kwong & Wallem - Japan – Daiichi Chuo, Daitoh Trading, Iino Lines, Kawasaki Line, Kyoei Tanker, Meiji Shipping, Mitsui OSK, Tokyo Marine, NYK, Nissho, Shinwa, Taiheiyo, Yuyo - Malaysia – MISC, Aurora, Sutrajaya, Barber Shipmanagement - Singapore – NAS, Petroships, PCL, Thome, TESMA, World Tankers, - South Korea – SK Shipping, Hanjin (Ass Member)

INTERTANKO IN ASIA Regional Office opened in Singapore in 1999 Regional Office opened in Singapore in 1999 Regional Panel since 1998 Regional Panel since 1998 Executive Committee members: Executive Committee members: - Mr KH Koo - TCC – Vice Chairman, - Mr Joseph Kwok – AET / MISC - Mr Shirakuma - NYK

INTERTANKO’s Objectives: Powerful voice for the tanker industry Powerful voice for the tanker industry Provide members with first class information and services Provide members with first class information and services

A powerful voice for the tanker operators worldwide: IMO IMO Dialogue with industry counterparts Dialogue with industry counterparts Partnership with USCG Partnership with USCG Lobbying on behalf of the tanker operators with EU & Washington DC Lobbying on behalf of the tanker operators with EU & Washington DC Washington State litigation – Victory in the Supreme Court of the US Washington State litigation – Victory in the Supreme Court of the US

Membership services: Weekly news Weekly news Advice to members on Operational/Technical/Legal matters Advice to members on Operational/Technical/Legal matters Port & Terminal information Port & Terminal information Freight and Demurrage Information Pool Freight and Demurrage Information Pool Terminal Vetting Dbase Terminal Vetting Dbase Practical publications on technical issues Practical publications on technical issues

Key issues facing tanker operators: ISPS Code – enforcement ISPS Code – enforcement Revisions to International Oil Spill Liability & Compensation Regime Revisions to International Oil Spill Liability & Compensation Regime Criminalisation of seafarers Criminalisation of seafarers Restoring trust with regulators / image of the industy Restoring trust with regulators / image of the industy

ISPS key issues: Enforcement – 1 July deadline Enforcement – 1 July deadline - What if a vessel has had its security plan approved but does not have a certificate on board? - Detention – if so for how long? - Will PSC target specific vessel types? Inspections by PSC Inspections by PSC - ensuring security does not compromise safety - Shanghai MSA – were only given a month to train their inspectors C/P considerations C/P considerations - Laytime / demurrage - Additional port expenses

Security clause – Voyage Charters Key Considerations: Validity of Notice of Readiness Validity of Notice of Readiness Allocation of the risk of delay to the vessel Allocation of the risk of delay to the vessel Provision of information by charterers Provision of information by charterers Warranting compliance with ISPS code and other security regulations Warranting compliance with ISPS code and other security regulations Allocation of costs, losses, liabilities Allocation of costs, losses, liabilities Nomination of alternative ports Nomination of alternative ports

Revisions to International Oil Spill Liability & Compensation Regime Current IOPC regime Current IOPC regime - CLC - Fund - Supplementary Fund Strict but limited liabilities for tanker owners Strict but limited liabilities for tanker owners Post incident fund by oil receivers Post incident fund by oil receivers Total compensation available approx 1bn USD Total compensation available approx 1bn USD

IOPC – the pressure for reform: Should the regime not just compensate oil victims efficiently but also tackle sub-standard shipping? Should the regime not just compensate oil victims efficiently but also tackle sub-standard shipping? Advocates of reform Oil Companies, EU States Advocates of reform Oil Companies, EU States Reform would most likely increase owners liability/insurance costs whilst sub-standard operators would continue and not care of the consequences Reform would most likely increase owners liability/insurance costs whilst sub-standard operators would continue and not care of the consequences

Criminalisation of seafarers The master of the Prestige – continued detention by Spanish authorities The master of the Prestige – continued detention by Spanish authorities Disincentive to join the industry – shortage of good crews Disincentive to join the industry – shortage of good crews No ship is safe without a responsible, well trained, motivated and happy crew No ship is safe without a responsible, well trained, motivated and happy crew Seafarers often not accorded the same human rights as others Seafarers often not accorded the same human rights as others

Restoring trust with regulators / image of the industy The major incidents of the Erika ( ) and the Prestige ( ) have fuelled a massive regulatory attack on the tanker industry The major incidents of the Erika ( ) and the Prestige ( ) have fuelled a massive regulatory attack on the tanker industry - Accelerated phase out of SH tankers - Pressure to reform the IOPC regime - Move to criminalise accidental pollution Major challenge to take control of our own industry – show that the industry is responsible & quality focussed – zero tollerance – not one drop of oil... Major challenge to take control of our own industry – show that the industry is responsible & quality focussed – zero tollerance – not one drop of oil...

Conclusion The world needs energy; our industry is there to provide a safe, environmentally sound, efficient and cost effective transportation solution INTERTANKO is there to promote the tanker industry; to encourage ever higher standards and technical innovation so that the industry may live up to the zero tollerance to pollution of the public and regulators alike

THANK YOU THANK YOU 谢谢大家