Northern European Panel 31 March 2009 Hamburg Peter M. Swift

INTERTANKO Overview Incident Statistics Council Agenda Criminalisation Update Piracy Greenhouse Gas Emissions Diary Dates

Accidental oil pollution into the sea and tanker trade Source: INTERTANKO/ITOPF/Fearnleys 1000 ts spilt Billion tonne-miles Record low pollution in 2008: 2,000 ts

Accidental oil pollution into the sea and tanker trade Source: INTERTANKO/ITOPF/Fearnleys 1000 ts spilt Billion tonne-miles Record low pollution in 2008: 2,000 ts

Tanker Incidents and accidental pollution Number incidents Based on data from LMIU, ITOPF + others

Tanker incidents 2008 by type Source: INTERTANKO/LMIU/various

Tanker groundings incidents Number incidents Based on data from LMIU, ITOPF + others

Tanker hull & machinery incidents Number incidents Based on data from LMIU, ITOPF + others

Tanker Engine incidents Number incidents Based on data from LMIU, ITOPF + others

Tanker Engine incidents Number incidents Based on data from LMIU, ITOPF + others Year<10 years10-24 years>25 yearsTotalAverage age Total

Council Agenda – 13 May 2009, Tokyo Corporate Affairs Piracy status report Greenhouse Gas Emissions Report items - Chemical items - Load Line Zones – Off South Africa - Criminalisation of Seafarers - update - Paris MoU – New Inspection Regime - Human Element – Roll out of TOTS - EU and US Issues

Criminalisation of Seafarers - Update EU Ship Source Pollution Directive “Hebei Spirit” officers Support for: IMO/ILO Guidelines on the “Fair Treatment of Seafarers in the Event of a Maritime Accident”

New Inspection Regime – Paris MoU Better targeting !!! “ Every ship eligible for a periodic inspection as follows: High Risk Ship (HRS) every 5-6 months Standard Risk Ship (SRS) every months Low Risk Ship (LRS) every months ”

Piracy Malacca Straits Nigeria / Gulf of Guinea Somalia – Gulf of Aden / W Indian Ocean

Piracy - Somalia Guidance to Industry Generic: IMO Circular 623 (Rev 3) Region Specific: UN Contact Group: Best Management Practices OCIMF/INTERTANKO/Industry Guide: Piracy - The East Africa/Somalia Situation Practical Measures to Avoid, Deter or Delay Piracy Attacks

Piracy Guidance for Gulf of Aden / Somalia Pre-transit: Assess Risk Plan self-defensive measures Register with MSCHOA IF appropriate, join Group Transit During transit: Stay alert Report to UKMTO Follow “best practices”

Piracy INTERTANKO activities Documentary Committee: Developed Piracy Model Clauses IMO: Member of Correspondence Group revising MSC Guidance Circular Industry spokesperson at Djibouti meeting finalising regional code UN: Member of Best Practices Working Group Observer at UN Contact Group EU Naval Coordination: Part-time secondee as Merchant Navy Liaison Officer US Congress: Testimony on International Piracy International: Interfaces with national governments PLUS REGULAR SECURITY BULLETINS TO MEMBERS

Piracy United Nations Contact Group WG 1 : measures to improve the coordination of, and information sharing between, the various naval forces present in the region and their interfacing with civilian shipping WG 2 : programmes to facilitate the prosecution of those caught and suspected of piracy WG 3: facilitates development of industry “Best Management Practices” to counter piracy and their application within the international shipping community WG 4 : communications and outreach strategies for use within Somalia and to the wider international community as part of capacity building programmes - this latter to be in conjunction with other UN programmes already on the ground within the region

[ Initiatives to Reduce ] Greenhouse Gas Emissions Shipping has a head start as the most energy efficient means of transport

20 CO 2 Emissions per Unit Load by Transport Mode Source: Ministry of Land, Infrastructure and Transport (Japan): The Survey on Transport Energy 2001/2002 MOL (Japan): Environmental and Social Report 2004 Large Tanker Large Containership Railway Coastal Carrier Small-size Commercial Truck Airplane Standard-size Commercial Truck Units Relative Shipping energy efficient

TANKER SHIPPING A GOOD NEWS STORY TANKER SHIPPING A GOOD NEWS STORY Shipping’s GREEN Credentials This car, weighing one tonne, uses 1 litre of fuel to move 20 kms This oil tanker uses 1 litre of fuel to move one tonne of cargo 2,500 kms –more than twice as far as 20 years ago

TANKER SHIPPING A GOOD NEWS STORY TANKER SHIPPING A GOOD NEWS STORY Shipping’s GREEN Credentials One US gallon of fuel moves one ton of freight 423 miles in this railcar One US gallon of fuel moves one ton of cargo more than 6,500 miles in this tanker

Reductions in GHG (CO 2 ) Emissions DRIVERS FOR CHANGE Driven hardest by a limited number of governments –Supported mostly by EU governments, plus Japan, Australia, Canada and a few others –Until recently only limited support in US (mostly environmental interests) –Relatively little enthusiasm in much of the developing world, but now changing ? Environmental Lobby growing –And becoming more coordinated Maritime industries showing considerable support –Proactive involvement –Although “hesitant” on market based instruments Economic incentives strong –Fuel savings translate into potentially significant cost savings; plus incentives for innovation & new technologies

One particular challenge for the shipping industry - i.e. seaborne trade will continue to grow strongly Source: Fearnleys/INTERTANKO Index There has been strong growth in shipping Trends – Population, Energy Use, Seaborne trade & CO 2 e missions

Kyoto Protocol Established under UN Framework Convention on Climate Change (UNFCCC) and adopted in 1997 Ratified by 181 countries – not the USA Categorises Annex 1 (Developed) Countries and Non- Annex 1 (Developing) Countries Annex 1 are committed to make GHG reductions with set targets, but also flexible mechanisms Runs through to 2012, with Conference of Parties (COP15) to meet in Copenhagen in Dec 2009 to develop successor Kyoto recognises “common but differentiated responsibilities”, i.e. developed countries produce more GHGs and should be “responsible” for reductions Kyoto looks to IMO to address Shipping and ICAO to address Aviation, and as such these emissions are currently excluded from Kyoto targets

Initiatives underway at the IMO 1998: IMO initiated work on Green House Gas emissions 2003: IMO Assembly adopted Resolution A.963(23): Policies and Practices Related to the Reduction of GHG from Ships Today: Work continues through the MEPC This year: we can expect MEPC 59 to adopt - Mandatory Energy Efficiency Design Index for new ships Ship Energy Management Plan – existing ships: - Best practices to save energy used by the ship - Use of voluntary Energy Efficiency Operational Indicator In December: the outcome(s) of MEPC 59 will be presented to UNFCCC COP15 meeting in Copenhagen

Initiatives underway at the IMO Ship Performance Index: CO 2 / work done e.g. tonnes of CO 2 produced per tonne mile of cargo Energy efficiency design index mandatory for new - ships incentivises designers and builders. At the next stage: The ship’s design index should be less than a maximum limit to be set by regulations. The maximum value will then be lowered over time. Voluntary energy efficiency operational indicator - measures efficiency of ship in service. A management tool for owners and charterers to measure energy efficiency on a voyage. Incentivises the owner to keep hull and machinery “clean” and charterer to use the ship efficiently – capacity, routing and speed.

SEMP: Examples of Best Practices for tanker emissions & energy efficiency 1.Programme for Measuring and Monitoring Ship Efficiency 2.Voyage Optimization Programme 1.Speed selection optimization 2.Optimised route planning 3.Trim Optimization 3.Propulsion Resistance Management Programme 1.Hull Resistance 2.Propeller Resistance 4.Machinery Optimisation Programme 1.Main Engine monitoring and optimisation 2.Optimisation of lubrication as well as other machinery and equipment 5.Cargo Handling Optimization 1.Cargo vapours control procedure on all crude tankers (80-90% reduction of cargo vapours) 2.Cargo temperature control optimization 6.Energy Conservation Awareness Plan 1.On board and on shore training and familiarisation of company’s efficiency programme 2.Accommodation-specific energy conservation programme

IMO is also reviewing possible economic measures (instruments) to reduce CO2 emissions Emissions Trading Scheme Bunker Levy GHG Compensation Scheme Hybrids of above Other, e.g. differentiated charges Industry has established Guiding principles and believe any measure should: Be effective in reducing global GHG emissions Be binding on and applicable to all ships Be cost effective Not distort competition Support sustainable environmental development without penalising trade growth Promote technical innovation and leading technologies Be practical, transparent, fraud-free, easy to administer

Market Based instruments Key issues: Global versus regional ? Who administers ? Still needed – if other industry initiatives in place ? ETS Sets Cap – reduces over time Open versus Closed system ? Value of carbon – different schemes Levy Does not set cap A tax on fuel (used) GHG Compensation scheme Does not set cap A tax for a good cause – i.e. a charity !

Initiatives already under way - parallel voluntary measures For most ship types, some form of : Speed optimisation Voyage optimisation Capacity optimisation is already in hand. For Tankers: Liaison is encouraged between owners and charterers to optimise vessel speed and voyage schedules

Other initiatives under discussion Pending the setting of mandatory upper limits for the Energy Efficiency Design Index of new ships, there exists the potential for: The Establishment of a Reference Value for a New Ship (i.e. a Target) Development of a Rating System relative to the Reference Value Similar to the performance rating of white goods

Other initiatives already under way - parallel voluntary measures Ports / terminals Ports developing Environmental Ship Index (for pollutants and GHGs) Incentives to improve port efficiency Reward environmentally friendly ships with lower port dues

UNCTAD Conference Maritime Transport and the Climate Change Challenge Engine Design Fuel Efficiency Gain Engine derating < 3.5% Diesel electric drives 5-30% Combined diesel electric and diesel mechanical drives <4% Waste heat recovery <10% Enhanced engine tuning and part load operation <4% Common rail engine <1% New BuildRetro-fit Operational Source: International Transport Forum 2009, OECD Estimates of fuel efficiency improvements are drawn from (Wartsila, 2008), (Green, Winebrake, & Corbett, 2008), (Bond, 2008) Tanker/Bulker Container Ro-ro Ferry-Cruise Offshore Supply

UNCTAD Conference Maritime Transport and the Climate Change Challenge Propulsion Systems Fuel Efficiency Gain Wing thrusters <10% Counter-rotating propellers <12% Optimised propeller-hull interface <4% Propeller-rudder Unit <4% Optimised propeller blade sections <2% Propeller tip Winglets <4% Propeller nozzle <5% Propeller Efficiency Monitoring <4% Efficient Propeller Speed Modulation <5% Pulling Thruster <10% Wind power: Flettner rotor <30% Wind power: Kites & Sails <20% New BuildRetro-fit Operational Tanker/Bulker Container Ro-ro Ferry-Cruise Offshore Supply

DIARY DATES Apr Chemical Tanker Sub-committee Americas, Houston 02 Apr Hellenic Mediterranean Panel, Athens 23 Apr Members’ Seminar, Singapore 24 Apr Crisis Preparedness &Media Awareness Workshop, Singapore 27 Apr Asian Regional Panel, Shanghai 12 May Chartering Seminar, Tokyo May Annual Tanker Event 2009,Tokyo 13 May Associate Members Committee, Tokyo 19 May Vetting Committee, Singapore 20 May Vetting Seminar, Singapore 09 Jun Chemical Tanker Committee, Oslo 09 Jun Norshipping: Boat Cruise and BBQ, Oslo 09 Sep Human Element in Shipping Committee, Copenhagen

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