Offshore Oil Workers To Stage Biggest Strike In A Generation

By City A.M - Apr 07, 2023

More that 1,300 offshore workers are to stage a 48-hour strike in a dispute over pay.

Unite warned that dozens of oil and gas platforms will be brought to a “standstill” by the walkout from April 24.

“There’s no question that contractors and operators can easily afford to give Unite members a decent pay rise.

“The scale of corporate greed in the offshore sector has to be challenged.

“1,350 offshore workers will now take part in an unprecedented tsunami of industrial action over 48 hours with hundreds more set to join them.

“Unite will support all our members every step of the way in this fight for better jobs, pay and conditions.”

Workers taking industrial action include electrical, production and mechanical technicians in addition to deck crew, scaffolders crane operators, pipefitters, platers and riggers.

John Boland, Unite industrial officer, added: “Unite has received an emphatic mandate in support of strike action.

“It is historic and it will be the biggest offshore stoppage in a generation.

“Unite’s members are determined to get their fair share and to establish a better working environment.

“This is not exclusively about pay but also working rotas, holidays, and offshore safety.

“The workforce has been taken for granted for years but now their value will be acutely felt when strike action will bring dozens of platforms to a standstill.”

By City AM

North Sea Oil Production Could Fall By 80% By 2030

By Felicity Bradstock - Apr 06, 2023

• Offshore companies reduce their spending in the North Sea, leading to a decrease in oil production.
• 
  
• Without additional funding, the UK may become reliant on foreign fossil fuels to meet its energy demands.
• 
  
• The introduction of a windfall tax has been blamed for the lack of interest in British waters.

According to the industry body Offshore Energies UK, investments in the North Sea have dipped significantly. This could result in much lower oil production by the end of the decade unless the government can attract greater investment to the sector. While environmental groups are praising the drop in funding, energy experts are concerned about what this means for the U.K.’s energy security, with some suggesting it may have to rely on foreign fossil fuels to meet its needs. 

Offshore Energies found that 90 percent of offshore firms had reduced their spending in the North Sea, amounting to billions in total. It determined that the lower level of investment could result in a decrease in production of 80 percent by 2030, equivalent to 500 million fewer barrels of oil if the government cannot attract more funding to the waters. This could lead the U.K. to rely on imports of oil and natural gas. 

The introduction of a windfall tax has been blamed for the lack of interest in British waters. The government introduced the tax last year as energy companies saw record profits as oil and gas prices rose sharply. This was largely in response to supply shortages and sanctions on Russian gas. Headline tax rates for companies rose from 40 percent to 75 percent, although several companies still posted profits. BP announced it had seen record profits of $22.7 billion in 2022. However, many companies believe it could be cheaper to invest in oil and gas operations in countries where taxes are significantly lower. Others have shifted investments to new ‘low-carbon’ oil operations, in a move away from traditional oil-producing regions. Other reasons for the reduction in investment include high levels of inflation, expensive material costs, and a lack of access to finance. 

Several environmental groups are suggesting the investments bound for the North Sea could be better used in renewable energy projects. This would both help the U.K. to ensure its energy security as well as accelerate the green transition by cutting fossil fuel use and carbon emissions. However, several industry experts see fossil fuels as playing a huge part in the U.K.’s mid-term energy security. Ross Dornan from Offshore Energies stated, “By the mid-2030s, according to the Climate Change Committee, oil and gas will still provide half our energy needs.” Therefore, "We should be aiming to get as much as possible of that energy from our own resources - meaning the North Sea,” Dornan explained. Dornan highlighted the need for the U.K. to attract investment in the sector or become reliant on other countries for its oil supply. 

Earlier in the year, Amjad Bseisu, CEO of the North Sea company EnQuest, stated that the U.K. is fiscally unstable, which has led the government to indulge in “short-termism” by introducing windfall taxes to the detriment of its oil and gas industry. In response to the rise in taxes, Bseisu said that Asia had become the company’s biggest growth area, instead of the U.K. or Europe. Although the windfall tax responds to 2022’s rising consumer energy bills and high oil and gas profits, it is expected to remain at the increased rate until 2028, which could deter energy companies from investing further in British oil and gas operations. 

Bseisu and other industry leaders believe it is vital for the U.K. to make the North Sea attractive to investors and maintain its oil and gas activities to bring in the revenues needed to fund the green transition. Without money from oil and gas, the government may not have the funds it needs to accelerate the rollout of renewable energy and related technologies. Further, it may need to spend more on oil and gas imports if its domestic production falls short of the country’s rising energy demand. 

Other countries, such as the U.S., have avoided introducing a windfall tax, having instead concentrated on boosting national production to ensure energy security. Revenues from the oil industry are expected to support the rollout of President Biden’s ambitious 2022 climate policy, the Inflation Reduction Act. The joint aim of accelerating the development of the U.S.’s green energy capacity while also decarbonising through carbon capture and storage technologies and other schemes will help the country to continue producing oil and gas as it speeds up its green transition. However, this too has been criticised, as many environmental groups believe Biden is offering too much support for oil and gas in contradiction to his climate pledges. 

Countries around the globe appear to be finding it hard to manage their energy security, needing to decrease consumer costs, move away from oil and gas, and increase their green energy production. The U.K.’s windfall tax has been blamed for deterring greater investment in North Sea oil and gas operations, which could negatively affect the country’s energy security. But at the same time, environmental organisations are suggesting the money could be better used in renewable energy projects. And other approaches, such as U.S. President Biden’s backing of domestic fossil fuel production, have received similar criticism. So, it seems that striking the right balance between mid-term fossil fuel production to ensure energy security and a long-term green transition is more complex than some originally thought. 

By Felicity Bradstock for Oilprice.com 

China’s Top Oil Companies To Invest $14.5 Billion In Renewable Energy

By Michael Kern - Apr 07, 2023

• Sinopec, CNOOC, and PetroChina – three of China’s state-owned energy companies – plan to diversify their energy portfolios by investing heavily in renewable energy.
• 
  
• Sinopec is investing at least $14.5 billion in the renewable energy sector through 2025, as it aims to become China’s top player in the emerging hydrogen market.
• 
  
• China’s government aims to have at least 50,000 fuel cell vehicles on the road by 2025, which would require a widespread network of hydrogen refuelling stations, thereby creating new investment opportunities in renewable energy.

China, the world's largest emitter of greenhouse gases, has committed to net-zero carbon dioxide emissions by 2060. The move is a significant change in direction for the country, which has heavily relied on coal-fired power plants for much of its energy needs. In response, state-owned energy majors have started ramping up their renewable energy investments. 

Three companies, China Petroleum and Chemical Corp or Sinopec, China National Offshore Oil Corp (CNOOC), and PetroChina are at the forefront of these investment efforts. The companies have set aside a joint investment of $14.5 billion in renewable energy projects in China to diversify their energy portfolios.

Sinopec Chairman Ma Yongsheng explained, "We want to become China's top player in hydrogen,” adding, "We will expand investments in renewable energy every year.” 

The company wants to become China's top player in the emerging hydrogen market and envisages expanding its existing infrastructure to set up more hydrogen stations for fuel cell vehicles. 

China's national hydrogen plan aims to have at least 50,000 fuel cell vehicles on the road by 2025, up from around 12,000 at the end of 2022, requiring a widespread network of hydrogen refueling stations. Sinopec has also launched a green hydrogen project in Inner Mongolia to fuel a coal-processing plant. It aims to reduce the plant's carbon dioxide emissions by around 1.4 million tonnes per year.

CNOOC, with a focus on offshore drilling in the past, is pivoting to offshore wind power platforms investing around $15 billion to $30 billion in new energy sources. 

Its first project in this direction involves building the Haiyou Guanlan deep-sea floating wind power platform, scheduled to commence operations in June. 

The wind platform, placed over 100 kilometers from the shore of Hainan province, is projected to generate 22 million kilowatt-hours a year on average. 

CNOOC CEO Zhou Xinhuai said his company would allocate 5-10% of its yearly budget to new energy sources.

PetroChina, China's largest oil and natural gas producer, set up a research hub in Shenzhen to focus on new energy sources, aiming to invest $10 billion annually by 2025. The energy company invested around $1.2 billion in solar power and other renewables, including the Xinjiang region, where its investment increased its total capacity six-fold in 2022.

China's move towards net-zero carbon emissions is not just limited to state-owned enterprises. The government has set ambitious targets for renewable energy development. China's wind and solar energy sectors are expected to reach 28% of the country's electricity production by 2030 and 81% by 2060, up from 13% in 2022. 

The government has also increased financial incentives for renewable energy, with investment in wind and solar power likely to exceed $600 billion by the end of this decade.

Although the move towards renewable energy investments represents a new beginning, it has challenges. As the country moves away from coal-fired power plants, state-owned energy majors are under pressure to reimagine their businesses to remain competitive. 

The transition comes as China struggles with an electricity shortage and surging inflation, which might impact the growth of new energy sources. 

Nonetheless, China's state-owned energy giants are determined to seize the opportunities created by the country's energy transition, not just to reduce emissions but to expand their businesses, retain their market dominance, enter new markets, and improve their corporate image.

By Michael Kern for Oilprice.com 

The Middle East Is Investing Billions Into Desalination Projects

By ZeroHedge - Apr 07, 2023

• Saudi Arabia and the UAE invest the most heavily in desalination projects in the world.
• 
  
• However, desalination technologies are expensive to build and use, require a lot of energy and produce toxic waste brine, and greenhouse gas emissions if they run on diesel.
• 
  
• Other countries such as the US, UK and Australia also invest in desalination, albeit to a lesser exten

The Middle East and North Africa account for some 48 percent of the world’s daily production of desalinated water, according to a report by BNC Intelligence.

Desalination is the process of removing salt and contaminants from sea water to produce fresh water.

The following chart, via Statista's Anna Fleck, looks at some of the countries investing the most heavily in the industry, as water stress continues to rise.

The 4th MENA Desalination Projects 2023 Report details how a total of $39.3 billion is currently being spent on desalination projects across the region, whether planned or already underway. Saudi Arabia and the United Arab Emirates are investing the most of these countries, with a total of $14.58 billion and $10.28 billion worth of projects, respectively. According to the U.S.-Saudi Council, as much as 60 percent of the Kingdom’s water came from desalination in 2019, the majority of which was produced by the government-run Saline Water Conversion Corporation (SWCC).

As oil rich nations with access to sea water and the means to invest, both countries have projects in the pipeline, with Saudi Arabia having $7.56 billion worth of projects currently in concept, design and tender, while the UAE has $7.88 billion worth of projects oncoming, as reported by BNC Intelligence.

So, as droughts become more commonplace and the need to replenish supplies more urgent, why aren’t other countries investing as much in desalination?

Firstly, some other countries are, at least to an extent.

The United States had 167 plants in Florida, 52 in Texas and 58 in California as of 2018, according to the Updated and Extended Survey of U.S. Municipal Desalination Plants and announced in 2021 it would be investing $5 million in desalination technologies. 

Australia and the United Kingdom are also among other affluent countries to own and use them, albeit none of these to the same scale of the plants in countries such as Saudi Arabia, the UAE and Israel.

Right now, desalination technologies have major limitations though, such as the fact the plants are extremely expensive to build and use, requiring a huge amount of energy to run.

At the same time, they produce toxic chemicals and large amounts of waste brine which is harmful to marine life and the environment, as well as greenhouse gas emissions if they run on diesel.

By Zerohedge.com

Texan Researchers Want To Store Hydrogen In Underground Salt Deposits

By Brian Westenhaus - Apr 08, 2023

Large underground salt formations have the potential to aid in the energy transition in myriad ways.

Texan Researchers propose the storage of hydrogen in underground salt caverns.

Salt domes are proven containers for hydrogen used by oil refineries and the petrochemical industry.

A new study led by researchers at The University of Texas at Austin’s Bureau of Economic Geology suggests that salt could have a big role to play in the energy transition to lower carbon energy sources. The study described how large underground salt deposits could serve as hydrogen holding tanks, conduct heat to geothermal plants, and influence CO2 storage. It also highlights how industries with existing salt expertise, such as solution mining, salt mining, and oil and gas exploration, could help.

Large underground salt formations have the potential to aid in the energy transition in myriad ways. Salt deposits can host caverns for hydrogen storage (left) and can help channel heat for geothermal power (right). The geology near salt formations (center left) is often well-suited for permanent carbon storage, which keeps emissions out of the atmosphere by diverting them underground. Image Credit: University of Texas at Austin’s Jackson School of Geosciences. Click the press release link for a larger image and more information.

Lead author Oliver Duffy, a research scientist at the bureau said, “We see potential in applying knowledge and data gained from many decades of research, hydrocarbon exploration, and mining in salt basins to energy transition technologies. Ultimately, a deeper understanding of how salt behaves will help us optimize design, reduce risk, and improve the efficiency of a range of energy transition technologies.”

The team’s study has been published in the journal Tektonika.

Salt has an influential role in shaping Earth’s subsurface layers. It is easily squeezed by geologic forces into complex and massive deposits, with some subsurface salt structures taller than Mount Everest. These structures and their surrounding geology offer a number of opportunities for energy development and emissions management, said study co-author Lorena Moscardelli, the director of the bureau’s State of Texas Advanced Resource Recovery (STARR) program.

Duffy said, “The co-location of surface infrastructure, renewable energy potential, favorable subsurface conditions and proximity to markets is key to plan for subsurface hydrogen storage. STARR is currently engaged with emerging energy opportunities in West Texas that involve hydrogen and carbon capture, utilization and storage potential for the region.”

Salt domes are proven containers for hydrogen used by oil refineries and the petrochemical industry. According to the paper, these salt formations could also be put to use as holding pens for hydrogen bound for energy production. What’s more, the porous rock surrounding them could be used as a permanent storage spot for CO2 emissions. The study describes the potential benefits of co-locating hydrogen production from natural gas called “blue hydrogen” and CO2 storage. While the hydrogen is sent to salt caverns, the CO2 emissions generated by production could be kept from the atmosphere by diverting them to the surrounding rock for permanent storage.

With its numerous salt domes surrounded by porous sedimentary rock, the Texas Gulf Coast is particularly well suited for this type of combined production and storage, according to the researchers.

The study also touches on how salt can aid in the adoption of next-generation geothermal technology. Although the industry is still in its early stages, the researchers show how it can make use of salt’s ability to easily conduct heat from warmer underlying rocks to produce geothermal power.

Bureau Director Scott Tinker said that because salt has a role to play in developing new energy resources, it’s important that multiple avenues are thoroughly explored. He said that researchers at the bureau are playing a critical role in doing just that.

Tinker said, “Bureau researchers have been studying subsurface salt formations for many decades. For their role in hydrocarbon exploration, as part of the Strategic Petroleum Reserve, for storage of natural gas, and now for their potential to store hydrogen. That’s the remarkable thing about great research. It just keeps evolving, improving and finding new applications.”

Additional co-authors include current and former bureau researchers Michael Hudec, Frank Peel, Gillian Apps, Alex Bump, Tim Dooley, Naiara Fernandez, Shuvajit Bhattacharya, Ken Wisian and Mark Shuster.

The Bureau of Economic Geology is a research unit of the UT Jackson School of Geosciences.

This is really interesting work. The possibilities are quite large in scale, which is a major attractant. So far there is an inventory of empty salt domes to exploit.

But the development of more huge deposits emptied out for storage is sure to light up the environmentalist crowd. An Everest sized salt excavation dumped onto the surface environment will not go unnoticed.

This is a really good idea, but lets hope the research goes into the consequences ahead of time so there won’t be a long full stop when the technology is needed.

By Brian Westenhaus via New Energy and Fuel

Third massive whale in a month beaches itself, dies in Bali



This handout photo shows a dead whale stranded on a beach in Jembrana, Bali, Indonesia. AFPA 17-metre-long (56-foot-long) sperm whale died after washing up on a beach in Bali, a conservation official said Sunday, making it the third whale that beached itself on the Indonesian island in just a little over a week.

The male sperm whale was found stranded on Yeh Leh beach in west Bali's Jembrana district on Saturday afternoon.

"We are currently trying to pull the carcass to the shore to make it easier for the necropsy test and we will bury it after the test is concluded," Permana Yudiarso, a local marine and fisheries official, told the media on Sunday.

This is the third whale that has beached itself in Bali, a popular destination for holidaymakers, in April alone.

On Wednesday, an 18-metre-long male sperm whale was stranded in Klungkung district, on Bali's eastern coast.


Onlookers stand near a dead whale that got stranded on Yeh Leh Beach in Jembrana, Bali, Indonesia.

Before that, a Bryde's whale weighing more than two tonnes and at least 11 metres long was founded stranded on a beach in Tabanan on April 1 -- its carcass already rotted when discovered by locals.

Yudiarso told AFP that their initial suspicion is that the sperm whale found Saturday also died of sickness, "just like the whale found stranded a few days ago".

"The body looked skinny and sickly," he said.

Yudiarso said it would take at least three weeks for the necropsy test to be concluded but forensic experts found some bleeding in the whale's lungs and its colon was filled with fluids.

Police have cordoned off the location to prevent people from stealing the mammal's meat or body parts.

In 2018, a sperm whale was found dead in Indonesia with more than 100 plastic cups and 25 plastic bags in its stomach, raising concerns about the Southeast Asian archipelago's massive marine rubbish problem.

Indonesia is the world's second-biggest contributor to marine debris after China.

Agence France-Presse

Trident Seafoods Factory Trawler Catches Fire in Tacoma

Fire aboard the Kodiak Enterprise, April 8, as seen from inside the fire boat Zenith (South King Fire and Rescue)

PUBLISHED APR 9, 2023 5:10 PM BY THE MARITIME EXECUTIVE

 

On Saturday afternoon, a fire broke out aboard a Trident Seafoods factory trawler at Tacoma's Tideflats Port Facility, burning through the deckhouse and the wheelhouse. It is the second major fire aboard a Trident vessel in Tacoma since 2021. 

The fire broke out in the early hours of Saturday morning, according to the Washington Department of Ecology. The Tacoma Fire Department dispatched crews to the scene to combat the fire from the pier, and South King Fire and Rescue sent the fire boat Zenith to assist from the water side. The U.S. Coast Guard closed down the waterway to marine traffic for safety, and multiple layers of booms were installed around the vessel to contain any potential spill. 

South King Fire & Rescue

Washington State Department of Ecology

Washington State Department of Ecology

The Washington State Department of Ecology set up air monitoring to watch for potential health hazards from the smoke, and it found pollutant levels at or below the level of moderate concern. The agency advised communities downwind of the fire to avoid prolonged exposure outdoors. 

No injuries or water pollution have been reported. As of Sunday, the vessel continued to emit a substantial volume of smoke. 

Kodiak Enterprise is a 1977-built factory trawler, originally constructed as an OSV and converted into a fishing vessel in 1989. She had just returned from her most recent Bering Sea fishing voyage on March 25, according to AIS data provided by Pole Star.

Trident's second fire since 2021

The fire aboard Kodiak Enterprise is the second to affect a Trident fishing vessel in two years. In February 2021, the catcher-processor Aleutian Falcon caught fire at a shipyard in Tacoma during maintenance work. 

The 2021 fire broke out while Aleutian Falcon was under repair. A team of welders were cutting out a section of corroded steel on the bridge deck, and sparks or slag likely ignited a wooden bulkhead in an interior space below, according to the NTSB. The fire spread throughout the vessel, resulting in a $16.5 million total loss. 

Among other impacts, the fire damaged crane hydraulic hoses, resulting in a small 20-30 gallon oil spill. The spill drew Trident a $25,000 state fine.

"Investigators found the scope of the repair work [on Aleutian Falcon] was not adequately communicated between workers, supervisors, and officials ahead of time. While working, crews did not take proper precautions or follow national standards that would have prevented the fire," Ecology claimed in a statement about the 2021 fire. "Also, Trident did not report the vessel emergency within an hour of the onset of the fire, as required under law and the company’s spill contingency plan."

A SEAFOOD VESSEL WITH A HISTORY OF SAFETY AND POLLUTION VIOLATIONS MOORED INDEFINITELY IN TACOMA’S FOSS WATERWAY

Publisher Center | April 9, 2023 | Seafood | 

A 77-year-old fishing vessel has been docked in Tacoma’s Foss Waterway, which has a reputation for pollution and safety violations, since August after a private jetty broke and raised concerns about its integrity. His owner said he doesn’t know when he will be leaving.

The fishing vessel Pacific Producer arrived at its current location on August 29, according to a nearby home.

“This is a significant threat to the health and safety of our community and the surrounding environment,” said Melissa Malott, executive director of Community for a Healthy Bay, a Tacoma-based environmental advocacy nonprofit.

The 472-gross-ton, 169-foot-long vessel was built in 1946 and has operated in Alaskan waters until recently. Registered with East West Seafoods in Seattle.

An Occupational Safety and Health Administration investigation was opened in July, but was delayed when the ship left Alaska for Seattle. On Jan. 12, OSHA cited East West for 20 violations, 17 of which were classified as “serious.” He imposed fines of $208,983 with abatement requested by Feb. 23.

“Working in Alaska’s fishing industry — an occupation already considered one of the nation’s most dangerous — employees of the F/V Pacific Producer faced hazards created only by their employer,” OSHA said in a statement.

OSHA Acting Regional Administrator Jack Rector said fishing workers depend on their employer for strong safety protocols.

“For more than a decade, our inspectors have found disgusting and dangerous conditions aboard the F/V Pacific Producer, and the well-being of the vessel’s crew is at great risk due to the negligence of its owner,” Rector said. “This employer’s blatant and ongoing disregard for the crew aboard the F/V Pacific Producer must end before tragedy strikes. The US Department of Labor and its federal partners will use their full enforcement powers to hold East West Seafoods and Christos Tsabouris to federal workplace safety standards to be held accountable for gross negligence and contempt.”

The regulations cover a wide range of standards including respiratory protection, fire protection, exposed wiring. hazard communication and ship components. All of the violations were reported by East West on Feb. 9, according to OSHA.

“Inspectors found dark, brown water in the vessel’s drinking water system; crew members are served expired food; Water used for processing fish that flows into dry food and galley feed; and other unsanitary conditions throughout the vessel,” OSHA said.

The US Coast Guard confirmed on Friday that it had revoked the Pacific Producer’s certificate of compliance, halting the East West’s operation until repairs are made.

CONFUSED HISTORY

Violations and fines are not new for the company and its owner since 2012, Christos Tsabouris.

The ship has had similar OSHA violations since 2012, including sanitation, electrical, fire hazards and an ammonia leak in 2018.

In 2017, East West Seafoods was fined $50,000 in federal court for intentionally dumping oily and dirty water from the Pacific Producer bilge into the ocean off the coast of Alaska.

He then submitted false records to the US Coast Guard.

The spill violated the Ship Pollution Prevention Act, the Clean Water Act and the Waste Disposal Act, according to the Department of Justice.

East West Seafoods was placed on five years of probation and Tsabouris was fined $10,000 and sentenced to five years in prison.

In a brief phone interview Wednesday, Tsabouris said he could not move the boat “because of legal paperwork,” but denied any involvement in the OSHA violation.

“We’re still working on it, so we don’t have anything concrete yet,” he told The News Tribune.

Tsabouris, who said he lives in Tacoma, moved the boat to the Foss Waterway because he couldn’t find a mooring in Seattle. He said he plans to return to service as a seafood processor.

MOORED IN TACOMA

According to a tenant at the nearby Petrich Marine Dock, the vessel arrived there on August 7, smashed against a dock.

“There were 10 people on deck screaming at each other and then they came in too fast,” said Freddy Neumayer, who witnessed the arrival. “It was pandemonium.”

The Pacific Producer, a large fishing vessel shown on Tuesday, April 4, 2023, has been tied up at the old Martinac shipyards on the Thea Foss Waterway in Tacoma since August. The ship is 77 years old, nearly 200 feet long, and has a history of environmental and safety concerns and fines.

Marina owner and 20-year Tacoma Port Commissioner Clare Petrich said Tsabouris has yet to repair or pay for the damage. The Pacific Producer was docked at its dock for less than two weeks before returning to Commencement Bay, Neumayer said.

On August 29, the ship returned to the Foss Waterway, this time at the old JM Martinac Shipyard at 401 East 15th Street.

During the ship’s first visit to Fosse in August, the Pacific Producer’s antenna reportedly clipped the 11th Street Bridge. According to the city, inspector Chad Norman found no structural damage to the bridge during a later inspection.

THE ROLE OF THE CITY

The City of Tacoma does not regulate boat traffic; that is the jurisdiction of the state and the Coast Guard. The city regulates the installation of moorings and harbor infrastructure in accordance with its coastal code. That is what an inspector from the city’s Planning and Development Service attended on March 20.

The inspector found that an illegal floating dock had been added to the site, in violation of city code.

“Employees will coordinate with state agencies to work to correct the violations,” the City said in a statement. “The next steps would be to get the necessary permits for the floating docks/moorings or remove those docks.”

ECOLOGY

The State Department of Ecology has no jurisdiction over ships, except for sinkings, spills or discharges that may cause accidents. Sometimes they include the deliberate illegal dumping of fuel, oil, sewage and other fluids.

The agency is not proactively involved with the vessels, said Ty Keltner, a spokesman for the DOE’s emissions prevention program. Instead, the agency responds to reports of contamination.

“We can’t proactively ban someone or take some kind of action just because they’re there,” Keltner said.

DOE is aware of the illegal dock installed for Pacific Producer, DOE spokesman Jeff Zenk said.

“We will provide technical assistance and support to the city of Tacoma,” Zenk said. “The city of Tacoma would be the one to enforce that.”

According to Secretary of State records, East West last filed as a corporation in November 2021. The office stated that the annual report was due on March 1, 2023. East West has a history of late annual reports. at least 2018

East West’s business address is a private mailbox rental service in Seattle.

Pacific Producers has been raising concerns with Communities for a Healthy Bay since the vessel’s arrival in August. The group said it notified the U.S. Coast Guard and the city of its concerns.

“It is important that the authorities take action and remove the vessel from our waters before it causes further damage,” Malott said.

Analysts See Continued Profit Declines for Shipping in 

PUBLISHED APR 7, 2023 BY THE MARITIME EXECUTIVE

 

As the investment community prepares for the start of earnings season with the first of the reports scheduled to be released as early as next week, speculation focuses on what the outlook is for the shipping industry’s financial results. There has been extensive focus on the dramatic declines in container volumes and spot freight rates which changed the trend lines starting last summer. Industry executives in their outlooks all agreed that the bulb has passed, but the question remains how low will profits decline in 2023?

Profits began to decline with the third quarter of 2022 showing the first significant impact after seven quarters of consecutive net income growth. The fourth quarter was the second quarter of sequential declines. Well-known industry analyst John McCown of Blue Alpha Capital in his latest report issued on April 3 calculates that net income was down over 41 percent in the fourth quarter versus Q3 and down by a third versus the year-ago period.

Sea-Intelligence points out that 2022 was overall a very strong year for the industry but that the cracks began to show in profitability. From the public reports, they calculate earnings before taxes and interest (EBIT) was $95 billion. They further estimate when MSC, which is private, CMA CGM which does not report EBIT, and other carriers such as PIL which had not reported were added in, carriers’ EBIT for 2022 reached an estimated $138 billion.

“However, there is a weakness in the market that is highlighted by a sharp contraction in transported volumes, while freight rates, through higher year-over-year, also seem to have slowed down,” cautioned Alan Murphy, CEO of Sea-Intelligence.

They are using a measure of EBIT/TEU to illustrate the emerging disparities in the shipping industry and as a signal of what is to come. “While the larger shipping lines have close to doubled their EBIT/TEU, the smaller ones were only able to increase it by a relatively smaller margin,” notes Murphy.

Fourth quarter 2022 Sea-Intelligence believes illustrates the emerging differences by size of the carrier. Large carriers they note were able to maintain EBIT/TEU levels close to Q4 2021 while the smaller lines were not able to maintain their profitability levels. On average, Sea-Intelligence calculates, the carriers recorded EBIT/TEU of $843 per TEU in Q4 down by a third from the year ago. 

The declines in profitability per container they report contributed to an overall 46 percent decline in EBIT year-over-year for the industry. Sea-Intelligence says the fourth quarter shows “visible indications of a weakening market.” They note that all of the shipping lines have remained profitable but the disparity is growing between the larger and smaller carriers.

John McCown points to steps he expects the shipping companies will continue to take to slow the declines. To counter falling rates and volumes he expects the industry will continue to slash capacity primarily by blanking sailings. He points out it worked well at the beginning of the pandemic and is likely to be top of mind for executives as they work to counter current market forces.

Despite these steps, McCown still sees an 80 percent decline in net income for the coming year. “My current placeholder for sector net income in 2023 is $43.2 billion.” He estimates total revenues will come in at $327.6 billion giving the industry a margin of just over 13 percent for 2023. 

“The larger point is that earnings in the container shipping industry are on a different curve than what has occurred in the spot rates, as the large majority of loads move under contract rates,” writes McCown. “While 2023 net income will be down significantly from 2022, my analysis of the latest data suggests the industry will remain profitable.”

Yet, while he predicts the industry will remain profitable, McCown in his report shows the trend line over the last two quarters carrying forward into 2023. Net income he forecasts will be strongest in the first quarter of 2023 at $14.9 billion, sliding to $10.8 billion in the second quarter before it levels off at $8.7 billion for both the third and fourth quarters. He however notes the difficulties in predicting sector results, especially in the current fluid market conditions. 

The Tendency of the Rate of Profit to Fall - REBEL (rebelnews.ie)