Panama election unlikely to shift outlook for First Quantum’s copper mine

Reuters | April 18, 2024 | 

Demonstrations against the contract have turned into an anti-government, end-to-all-mining movement. (Image: Screenshot of stock video.)

Prospects are poor for First Quantum Minerals to recover its canceled concession for a lucrative copper mine after presidential elections in May, a Reuters review of the campaigns’ proposals and interviews with protest leaders show.


Protests against First Quantum’s concession demanding greater environmental guarantees and transparency in negotiations made authorities not only annul its contract to operate one of the world’s largest and newest copper mines but ban all new metal mining permits last year.

Metal traders and investors are closely watching the election outcome to see if a new president could help revive mining in Panama.

Eight candidates are set to appear on the May 5 ballot, with polls showing a tight race. Among the five frontrunners, three have vowed to continue with the plans to close the Cobre Panama mine, one has pledged a referendum on the matter and another has not formally indicated his intentions.

The Canadian miner lost nearly half of its market value after it was stripped of its contract and in March global rating agency Fitch downgraded Panama’s sovereign bonds to speculative grade, citing fiscal and governance challenges aggravated by the mine’s closure.


Asked about its expectations for the mine after the vote, a spokesperson for First Quantum said only: “As in any jurisdiction we operate in, we look forward to seeing the process of democracy deliver the candidate of Panama’s choice in a fair, transparent and peaceful election.”

Reuters spoke to leaders from five different protesters’ groups. Three groups, including the country’s main workers’ union SUNTRACS, said there was no scenario under which they would let authorities seal a new partnership with First Quantum.

“People already showed on the streets they don’t want metal mining,” Saul Mendez, head of SUNTRACS, said.

Two groups said they would support a referendum on the matter, and predicted the result would be against mining. A survey published by local newspaper La Prensa in February showed 90% of Panamanians oppose mining.

All five groups expressed their distrust towards candidates, even the ones who have outright opposed mining, saying that politicians do not tend to fulfill their promises.

“If the incoming president opens that mine without authorization from the whole country, of course we’re going back to the streets and to the sea,” Sabino Ayarza, a representative of the fishing flotilla that halted First Quantum’s operations by blocking its main port, told Reuters.

“And we’re going with other thoughts. We are no longer going passively as before, but aggressively to close that.”

Reuters also spoke to six legal experts in Panama who said that while local laws could technically allow First Quantum’s prospects to change in a matter of months, a referendum or another type of consultation to ensure public support would be the only way to achieve that politically.

First Quantum said in February it was seeking $20 billion through international arbitration over Panama’s order to close the mine. The miner has filed for two arbitration proceedings, one under the Canada-Panama Free Trade Agreement, and another linked to the arbitration clause on the canceled contract. The clause provides for proceedings in Miami, according to the company.

Panama’s deputy finance minister told Reuters days after the announcement that the country is ready to defend its interests in the legal battle against First Quantum, adding the state will prove to courts it respects foreign investment.

Renzo Merino from Moody’s sovereign team said Panama’s economy was already doing well before the mine began to extract copper. “Panama hasn’t lost that. It still has the potential,” he said, while warning a recovery could be slow if investor concerns spread to other sectors and the country is forced to pay compensation in arbitration.
Presidential frontrunners

Mining has not been a big campaign issue.

Among the five frontrunners, Jose Raul Mulino, who is leading the latest polls, does not mention mining in his government plan and he has not attended any presidential debates.

Former President and candidate Martin Torrijos, who has been among the top three candidates in many polls, does not mention intentions for mining in his government plan, though he told Reuters at a campaign event that the closure of the mine is a decision Panamanians already took and he plans to follow.

Romulo Roux vowed in his plan to press ahead with closing the mine, but did not mention anything about the future of mining. He was not available for an interview but his running mate, Jose Blandon, told Reuters at an event that his team has no plans to overturn the mining ban.

Current vice president and presidential candidate Jose Gabriel Carrizo’s proposal for the country calls for a public vote for Panamanians to decide on the future of mining.

The campaigns of candidates Mulino, Roux, and Carrizo did not make them available for interview for this story.

Panama’s ban on new metal mining concessions pushed up copper prices due to fears about supply. Any hint of a shift in Panama could again move markets.

Candidate Ricardo Lombana, who has been moving between second and fourth place in the latest polls, went further in his government plan by proposing to change the constitution to ban mining outright.

“No economic impact is above the constitutional mandate and the sovereign will. The whole country knows that the concession contract is illegal and that its closure must be consummated,” Lombana told Reuters.

(By Valentine Hilaire, Elida Moreno and Divya Rajagopal; Editing by Denny Thomas and Claudia Parsons)

Rio Tinto, Saudi Arabia vying for First Quantum mines stake

Bloomberg News | April 18, 2024 | 

First Quantum’s 80%-owned Kansanshi mine in Zambia is Africa’s largest copper operation. (Image courtesy of Liam Richer | YouTube)

Rio Tinto Group and Saudi Arabia’s state-backed Manara Minerals Investment Co. are among suitors considering bids for a stake in First Quantum Minerals Ltd.’s Zambian copper mines, according to people familiar with the matter.


Japanese trading houses Mitsui & Co. and Sumitomo Corp. have also been studying the assets, the people said, asking not to be identified as the talks are private. First Quantum is open to selling as much as 30% in its mines in Zambia, depending on the offers it receives, and is seeking first-round bids in the coming weeks, they said.

The Sentinel and Kansanshi mines could also attract interest from Chinese companies such as Zijin Mining Group Co. and Jiangxi Copper Co., which is First Quantum’s second-biggest shareholder, the people said. The process is in the early stages and there’s no certainty the parties will proceed with bids.

Shares of First Quantum rose as much as 6.9% to C$15.80 in Toronto after Bloomberg reported interest in the Zambian mines stake.

Zambia accounted for about half of First Quantum’s copper output and revenue last year, and delivered more than $450 million in operating profit.


First Quantum is selling a stake in its Zambian assets after it was ordered to close its flagship copper mine in Panama last year following public protests. That left the company scrambling to refinance the debt it took on to build the mine. The firm sold about $1 billion in stock and raised $1.6 billion from a notes offering this year and has said it may look at divesting smaller mining assets.

A spokesperson for Sumitomo said that the company continues to explore opportunities to acquire stakes in copper operations, declining to comment on specific deals. Spokespeople for First Quantum, Rio, Mitsui and Jiangxi Copper declined to comment. Representatives for Manara and Zijin Mining couldn’t immediately be reached.

The copper mines are attracting interest from a range of investors because demand for the metal is expected to soar in coming years. Copper is crucial for the production of electric vehicles and renewable energy infrastructure, while there is a lack of new mines being built.

And there are also relatively few good assets to buy. Some of the mines available in the central African copper belt, which stretches through Zambia and the Democratic Republic of Congo, aren’t appealing to buyers, and major firms are unwilling to sell stakes in their most important developments.

That means companies that have previously avoided taking stakes in mines in Africa — such as Japanese trading houses — have started to become more open to the possibility.

Rio, the world’s second-largest mining company, is generally reluctant to be a non-operator and has also avoided the central Africa region. The company’s copper head said at a recent conference that he sees much more value in building mines rather than buying existing assets. Still, the company has some ties with First Quantum and sold it a majority stake in a development project in Peru last year.

For Saudi Arabia, the deal would be another major coup following its purchase of a stake in Vale SA’s base metals unit for $2.6 billion. The kingdom is looking to secure supplies of metals for its industrial ambitions as it attempts to diversify its economy away from oil.

(By Dinesh Nair, Vinicy Chan and Thomas Biesheuvel)

Glencore and Trafigura’s sanctions games are draining the LME

Bloomberg News | April 19, 2024 | 

LME warehouse. Credit: Steinweg Group

The world’s two biggest metals traders are moving to withdraw large volumes of aluminum from the London Metal Exchange in a complex trade made possible by new UK sanctions on Russian metal, raising questions about unintended consequences from the new rules.


Trafigura Group and Glencore Plc plan to withdraw the metal to profit from a new multi-tiered system created by the sanctions, according to people familiar with the matter. The trade involves ordering out Russian metal and then re-registering it on the LME under a new, less-desirable category, while striking profit-sharing deals with warehouses to receive a sliver of the rent paid by future owners for as long as it sits there. (The longer it sits, the more money they stand to make.)

Nearly $400 million of aluminum was requested for withdrawal this week from warehouses in South Korea and Malaysia, according to LME data, driving live inventories in the warehouse system close to a record low. Trafigura and Glencore have both been behind orders for withdrawal of aluminum this week, according to people familiar with the matter.

The play, which has captured the attention of the global metals world, raises questions about whether the UK government was aware of the opportunities it was creating for traders to game a complex set of rules imposed by the sanctions last week.

The nature of the trade means that the metal will ultimately be placed back on the LME. But the restrictions have added new layers of paperwork and approvals as traders must prove the provenance of the metal they are registering, which is likely to slow down the process and keep LME inventories lower for longer.

The US and UK last Friday announced a ban on deliveries to the LME and Chicago Mercantile Exchange of any Russian aluminum, copper and nickel produced after April 12. The restrictions are aimed at driving down demand and prices for Russian supplies, while seeking to avoid wider disruptions by allowing its miners to keep selling to non-US and -UK buyers outside of the LME.

Still, LME prices for all three metals have risen sharply this week, with aluminum up 7% and copper closing in on $9,900 a ton for the first time since mid-2022.

Gaming warehousing rules has long been a central part of many traders’ strategy, especially in the aluminum market, and the past week’s moves are unlikely to have a meaningful impact on the wider question of whether the sanctions will be successful at reducing Russia’s revenue from selling metals.

The key for the trade being pursued by Glencore and Trafigura is that the UK has allowed existing stocks of Russian metal to continue to be traded on the LME. However, this “old” Russian metal will be treated differently if it was already stored in LME warehouses when the sanctions came into effect.

By withdrawing and re-registering the metal under a different category, the traders would reduce the pool of potential owners and make it more likely that it remains sitting in the same LME warehouse for an extended period of time — all the while generating profit for them thanks to the practice of “rent sharing.”

Spokespeople for Glencore and Trafigura declined to comment.

The growing percentage of Russian stocks on the LME has already been a controversial subject since the invasion of Ukraine, and the share had increased further in recent months — to more than 90% for aluminum.

One significant risk to the trade is that either the LME or the UK government move to change the rules and so to undercut it. The UK Treasury is keeping the trade license — which created the dual categories of Russian metal — under review as it monitors trade flows and trade practices, according to a person familiar with its thinking.

The LME has said since the sanctions were announced that it is prepared to take further action on Russian metal if there are developments that threaten market orderliness.

“The LME continues to monitor the market closely and remains ready to take further action should that be required, including in relation to adverse market behaviors as a result of the introduction of the recent sanctions,” a spokesperson said.

For the exchange and the broader aluminum market, the immediate consequence of the withdrawals is that the volume of stock that’s readily available to other buyers has fallen to critically low levels.

Live aluminum inventories stand at 171,200 tons, nearing a record low struck in 2022, and traders expect that there will be further requests to withdraw metal in the coming days.

With spot prices trading at steep premiums to futures this week, there’s a growing focus on how long it will take for the metal that Glencore and Trafigura are withdrawing to re-enter the LME system, given that the LME will need to manually approve the applications and confirm that they are compliant with the new rules.

(By Mark Burton and Jack Farchy)

US restricts drilling and mining in Alaska wilderness, angering (GOP) state leaders

Reuters | April 19, 2024 | 

National Petroleum Reserve Alaska. Credit: BLM

The Biden administration on Friday took steps to limit both oil and gas drilling and mining in Alaska, angering state officials who said the restrictions will cost jobs and make the US reliant on foreign resources, but pleasing environmentalists.


The measures are aligned with President Joe Biden’s efforts to rein in oil and gas activities on public lands and conserve 30% of US lands and waters to combat climate change.

The Interior Department finalized a regulation to block oil and gas development on 40% of Alaska’s National Petroleum Preserve to protect habitats for polar bears, caribou and other wildlife and the way of life of indigenous communities.

The agency also said it would reject a proposal by a state agency to construct a 211-mile (340-km) road intended to enable mine development in the Ambler Mining District in north central Alaska.

The agency cited risks to caribou and fish populations that dozens of native communities rely on for subsistence.

“I am proud that my Administration is taking action to conserve more than 13 million acres in the Western Arctic and to honor the culture, history, and enduring wisdom of Alaska Natives who have lived on and stewarded these lands since time immemorial,” Biden said in a statement.

The NPR-A, as it is known, is a 23 million-acre (93 million hectare) area on the state’s North Slope that is the largest tract of undisturbed public land in the United States. The new rule would prohibit oil and gas leasing on 10.6 million acres (4.3 million hectares) while limiting development on more than 2 million additional acres (809,000 hectares).

The rule would not affect existing oil and gas operations, including ConocoPhillips’ $8 billion Willow project, which the Biden administration approved last year.

Currently, oil and gas leases cover about 2.5 million acres (1 hectare).

The Ambler Access Project, proposed by the Alaska Industrial and Development Export Authority, would enable mine development in an area with copper, zinc and lead deposits and create jobs, the authority has said.

Interior’s Bureau of Land Management released its environmental analysis of the project on Friday, recommending “no action” as its preferred alternative. The project now faces a final decision by the Interior Department.

Republican senators from Alaska and several other states held a press conference on Thursday to slam the administration’s widely anticipated decisions.

“When you take off access to our resources, when you say you cannot drill, you cannot produce, you cannot explore, you cannot move it — this is the energy insecurity that we’re talking about,” Senator Lisa Murkowski said. “We’re still going to need the germanium, the gallium, the copper. We’re still going to need the oil. But we’re just not going to get it from Alaska.”

Environmentalists, an important part of Biden’s base ahead of the Nov. 5 US elections, praised the moves for protecting habitats and cultural resources at a time of change in the region.

“As the Arctic undergoes dramatic climatic changes, this new rule (on NPR-A) is absolutely necessary to protect birds, caribou, and fish,” said David Krause, interim executive director at Audubon Alaska.

(By Nichola Groom and Timothy Gardner; Editing by Leslie Adler)

 

Ontario Shipyards Shuts Down its Thunder Bay Facility

Fabmar Thunder Bay (file image courtesy Ontario Shipyards)

PUBLISHED APR 17, 2024 4:32 PM BY THE MARITIME EXECUTIVE

 

Canadian firm Ontario Shipyards has decided to shutter its plant at Thunder Bay, citing a shortage of workers and a slow market. 

In 2020, Ontario Shipyards (then known as Heddle Shipyards) entered an agreement with Vancouver shipbuilder Seaspan to construct blocks for the future two-ship Polar Icebreaker program, part of Canada's National Shipbuilding Strategy (NSS). The following year, Heddle bought a yard in Thunder Bay - Fabmar Metals - and equipped it for building ship modules. 

Because of delays at Seaspan, the Canadian government reopened the NSS to a new round of shipyard bids, intending to bring in more capacity to build the icebreaker program. It selected Quebec's Davie Shipyards to join the effort, and it awarded one polar icebreaker to Seaspan and one polar icebreaker to Davie. Seaspan has been progressing with R&D operations to support its side of the project, including building a test block, and it plans to begin building the first production block this year. 

The impact of the divided icebreaker contract on Ontario Shipyards is unclear, but Ontario has decided to mothball its facility at Thunder Bay. The site remains fully equipped and ready to turn on again at a moment's notice, but 15 workers were laid off, according to local media. 

Ontario Shipyards also operates two other locations in Port Weller and Hamilton, Ontario. It has invested heavily in equipment and workforce training at these sites, and they remain open. 

 

China Calls Accusations “Untenable” in Response to US Shipbuilding Inquiry

China responded to the U.S. allegations over its shipbuilding practices (CSSC file photo)

PUBLISHED APR 18, 2024 3:22 PM BY THE MARITIME EXECUTIVE

 

 

Chinese officials and the state-run media continued the strong response denouncing the U.S.’s announcement of a trade investigation into the shipbuilding sector and efforts to triple the tariffs on steel. Chinese media writes the U.S. administration is using an “old playbook of unilateralism and protectionism,” saying it will fail to reshore manufacturing and result in a more expensive supply chain.

China’s Commerce Ministry issued a series of statements responding to the U.S. announcements and said regarding the steel tariffs that, “China has urged the U.S. to confront its internal challenges, while also demanding the immediate removal of imposed tariffs.” They responded by accusing the United States of abusing the Section 301 tariff review while saying the World Trade Organization has ruled the U.S. measures violate global trade rules.

Addressing the application for the review of the maritime, logistics, and shipbuilding industries filed by five U.S. unions in March 2024 with the U.S. Trade Representative they asserted it “lacks factual basis and goes against economic common sense.” They are citing China’s efforts since the 1980s to build the shipbuilding industry saying that their success is the result of enterprises’ technological innovation and active participation in market competition.

“Multiple U.S. research reports show that the U.S. shipbuilding industry has lost its competitive advantage many years ago due to over-protection,” the Ministry of Commerce spokesperson said. “The United States provides hundreds of billions of dollars in discriminatory subsidies to its own industries, but accuses China of adopting so-called ‘non-market practices’.”

China is calling for the United States to “return to the rules-based multilateral trading system,” while also referencing the “domestic political needs” ahead of the upcoming U.S. presidential elections. Media reports in China are saying supporting labor unions is critical in a U.S. election year.

They are saying the U.S.’s actions would have a “minimal impact on Chinese shipyards.” They said there has never been competition between the U.S. and Chinese shipbuilders, noting that for 14 consecutive years, China has completed the greatest number of ships worldwide. Furthermore, they highlight that Chinese shipbuilders now account for 50 percent of the yearly global orders. 

The U.S. Trade Representative is set to schedule hearings and solicit comments promising a thorough review of the filing made by the U.S. unions. China said it would “pay close attention to the progress of the investigation and will take all necessary measures to resolutely defend its rights and interests.”

US to Investigate China's Shipbuilding as Biden Calls for New Steel Tariffs

China and CSSC have emerged as the world's leading shipbuilders (CSSC)

PUBLISHED APR 17, 2024 12:41 PM BY THE MARITIME EXECUTIVE

President Joe Biden and the U.S. Trade Representative confirmed today that they are initiating an investigation into China’s shipbuilding practices. News of the investigation comes as President Biden and the White House will tell steelworkers that they are also calling for a tripling of tariffs on Chinese steel and aluminum. He is also promising to block efforts by China and others to circumvent U.S. restrictions by importing products through Mexico.

The White House said the administration recognizes the growing concerns that unfair Chinese trade practices, including flooding the market with below-market-cost steel, are distorting the global shipbuilding market and eroding competition. While highlighting that the U.S. trade deficit with China is the lowest it has been in a decade, the administration is also accusing China of unfair competition saying China is undercutting U.S. products with artificially lower-priced alternatives. They cite the critical nature of steel in U.S. commercial and naval shipbuilding calling steel the backbone of the American economy. 

The concerns over China subsidies and state control of the shipbuilding industry were outlined in a petition to the U.S. Trade Representative from five labor unions. Filed in March, the unions formally requested an investigation into Chinese acts, policies, and practices in the maritime, logistics, and shipbuilding sectors.

“The petition presents serious and concerning allegations of [China’s] longstanding efforts to dominate the maritime, logistics, and shipbuilding sectors, cataloging the PRC’s use of unfair, non-market policies and practices to achieve those goals,” said U.S. Trade Representative Ambassador Katherine Tai. The announcement marks the start of a process of comments and hearings into China’s shipbuilding programs and could see tariffs imposed on Chinese-built ships calling at U.S. ports.

Administration officials are saying that China accounts for more than half the world’s steel exports. They said the Chinese have created overcapacity with non-market investments in the steel and aluminum industries.

“The steel and aluminum industries face a significant challenge from Chinese exports which are among the most emissions-intensive products in the world,” the White House wrote in its briefing document. It accuses China of “distorting the global shipbuilding market and eroding competition.”

China’s commerce ministry responded immediately to the accusations saying the initiative was “full of false accusations, misinterpreting normal trade and investment activities.” They repeated the Chinese position that the U.S. administration is playing the “China card” for its political aspirations. 

The White House cites over 30 anti-dumping and countervailing duties on steel-related products already imposed by the U.S. Department of Commerce. President Biden said he was not seeking a trade war, but said steps would be taken against countries and importers that flood the market with cheap products.

President Biden said they would also be working with Mexico to jointly prevent China and other countries from evasion of tariffs on steel and aluminum by importing products into the United States from Mexico. 

Biden – and steelmakers – promise US Steel

will stay American

Reuters | April 17, 2024 | 

Credit: US Steel

US Steel and Japanese buyer Nippon Steel said the Pittsburgh-based firm will remain an “iconic American company” even after a planned $14.9 billion takeover, echoing President Joe Biden’s promise to local steelworkers.


The two steel giants responded hours after Biden on Wednesday pledged that US Steel would remain a “totally American company,” repeating his opposition to the deal.

“And that’s going to happen, I promise you,” Biden told the supportive crowd during an event in Pittsburgh.

US Steel Corp has agreed to be bought by Nippon Steel for $14.9 billion, but the deal has been described as being on life support since the Democratic president announced his opposition last month.

“The partnership between US Steel and Nippon Steel is the right combination to ensure that US Steel remains an iconic American company for generations to come,” the steelmakers said in a joint statement.

“Its iconic name will be unchanged, and its products will remain mined, melted and made in America,” the statement said, adding that jobs and plants would be protected.

The partnership would also strengthen the US steel industry’s resilience against threats from China and support the “crucial” US-Japan alliance, the companies said.

Senators raise concerns over Nippon Steel’s China ties amid US Steel takeover bid

United States Steel shares closed down 2.9% at $39.13 on Wednesday. Nippon Steel shares were trading up 1.05% at 3,468 yen on Thursday morning in Tokyo.

Biden was in Pittsburgh ahead of November’s presidential election, and he used a visit to the headquarters of the United Steelworkers union to push for higher tariffs on Chinese metal imports and new investigations into their trade practices.

A senior administration official briefing reporters ahead of that announcement declined to say whether Biden would use the levers of government to block the deal from going through.

“Nothing new to add,” said the official, who declined to be named.

“Let’s keep US Steel in America,” a woman among the steelworkers shouted to Biden during a meet-and-greet.

“Guaranteed,” Biden replied.

(By Steve Holland, Costas Pitas, Mariko Katsumura, Susan Heavey and Trevor Hunnicutt; Editing by Caitlin Webber, Chang-Ran Kim and Tom Hogue)

 

Geopolitical and Economic Issues Impact Rotterdam and Antwerp-Bruges

Rotterdam and Antwerp-Bruges reported rebounds in container volume in 2024 (Rotterdam file photo)

PUBLISHED APR 18, 2024 8:31 PM BY THE MARITIME EXECUTIVE

 

 

Two of Northern Europe’s leading ports reported first quarter 2024 results citing the ongoing geopolitical uncertainties and the impact on European economies. While Rotterdam remains the larger port overall, it reported a slight decline in overall throughput due to persistent economic issues while Antwerp-Bruges both saw an increase in total cargo throughput and critically pulled nearly even with Rotterdam on container volumes.

Both ports experienced improvements in their container trade despite the impact of the disruptions in the Red Sea. Rotterdam for example reported a slight increase in container throughput for the first time in three years reaching 3,289,000 TEU despite a 24.5 percent decline in ships in January and February which resulted in a nearly 14 percent decline in volumes.

Antwerp-Bruges however reports that after economic uncertainty and inflation led to a global slowdown in demand for container shipping in 2023, container throughput picked up again from February, with March even witnessing the best monthly throughput since March 2021. For the Belgium ports, this resulted in a six percent TEU rise in total container throughput and put them just 2,000 TEU (total of 3,287,000 TEUs) behind Rotterdam.

Executives at Antwerp were also encouraged by an upward trend for conventional general cargo. While it was down nearly eight percent versus the year-ago first quarter, volumes were up nearly seven percent versus the fourth quarter of 2023. They reported that iron and steel remained nearly unchanged and liquid bulk also helped up relatively well while most other goods recorded a decline over the first quarter of 2023.

“The throughput figures show limited imports of raw materials and exports of finished products,” said Boudewijn Siemons, CEO & Interim COO of the Port of Rotterdam Authority. “This tells us that European industrial production is still suffering from high energy prices and low demand from the biggest declining sectors such as construction and the processing and automotive industries. From the growth in container throughput, we see the first signs that world trade is picking up. However, these tentative signs remain highly uncertain due to rising global tensions.”

Rotterdam reports that by March shipping lines and logistics chains had largely adjusted to the Red Sea disruptions. They saw a significant (11.5 percent) increase in the number of arriving ships and volumes from Asia recovered. The diversions around Africa also meant that Rotterdam was receiving more cargo heading to the Mediterranean and an increase in feeder traffic to transport cargo to the Mediterranean destinations.

Antwerp-Bruges also reported that overall sea-going vessel calls were down nearly two percent in the quarter to a total of 4,855 vessels. They, however, highlight efforts to develop long-term capabilities including achieving for the first time the required 16-meter (52.5 foot) draft with a containership. In addition, a new record for the largest container volume handled on a single ship was set in March on the MSC China (240,000 dwt), with 26,201 TEUs.

Antwerp also completed its first methanol bunkering of a sea-going vessel. Maersk’s first methanol-capable ocean-going containership Ane Maersk bunkered 4,300 tons of green methanol and 1,375 tons of biodiesel (B100) during its stay in Antwerp on its maiden voyage.

 

Spain Deports 65 Bolivians Who Arrived on MSC Cruise Ship

An MSC cruise ship at Port of Barcelona (file image courtesy Jordi Ferrer / CC BY SA 3.0)

PUBLISHED APR 12, 2024 9:00 PM BY THE MARITIME EXECUTIVE

 

 

Dozens of Bolivian passengers from an MSC cruise ship are being deported back to their home country after officials in Spain detected problems with their paperwork. It is not clear yet whether the people involved were aware of the violation, and investigators are looking into whether they may have been duped in a fake-visa scam. 

On April 2, Spanish immigration authorities detained 69 Bolivian nationals aboard the cruise ship MSC Armonia, including families with children. The ship had arrived in Barcelona on a 16-day "Grand Voyage" itinerary from Brazil, having stopped over previously in Tenerife and Malaga.

On close inspection, Spanish authorities determined that the Bolivians had fake visas for entering Europe's Schengen zone. The cruise ship and all of its 1,500 other passengers were held in Barcelona overnight while officials worked out the problem. Eventually, the ship was allowed to depart, and the Bolivians stayed behind, housed temporarily on another vessel in the harbor. 

Now that proceedings are complete, 65 individuals will be flown back to Bolivia at MSC's expense. Four with family connections in Spain have been allowed to stay in the country. 

MSC Cruises has told media that the Bolivian passengers presented what appeared to be valid visas when they got on board in Brazil. Spain's national police are investigating how they may have obtained fraudulent documents, and whether they were aware that the visas were fake. The passengers did not take the first opportunity to jump ship in the EU when MSC Armonia called in Malaga; they stayed on board until Barcelona, their final destination, where their paperwork irregularities were detected. 

Top image: An MSC cruise ship at Port of Barcelona (file image courtesy Jordi Ferrer / CC BY SA 3.0)

 

Report Shows Plan for How Ports Can Supply Green Methanol & Ammonia by 2030

PUBLISHED APR 17, 2024 10:34 AM BY THE MARITIME EXECUTIVE

 

[By: Global Maritime Forum]

The Global Maritime Forum and RMI (founded as the Rocky Mountain Institute), under Mission Innovation’s umbrella, released a report today outlining strategies for ports to become first movers in providing green methanol and ammonia bunkering. The report provides insights into the sources of green methanol and ammonia that could be available to the shipping industry and how ports can secure supply to meet the International Maritime Organization’s (IMO) target of at least 5% use of zero-emission fuels by 2030.

As the maritime industry transitions towards decarbonization, there will be significant changes in the sourcing and distribution of marine fuels. The report finds that the low cost of transporting green methanol and ammonia, which are produced from green hydrogen, will lead to extensive trade linking low-cost production regions to key ports. Policy support for green shipping fuels has the potential to significantly impact a country or region’s position in this burgeoning hydrogen economy.

“Federal incentives in the Inflation Reduction Act have made the United States one of the most competitive regions in the world for green fuel production,” said Aparajit Pandey, Principal and Shipping Decarbonization Lead at RMI. “Smaller ports with excellent renewable resources, including ports in the Global South, can build cost-competitive hydrogen production facilities and participate in the global bunker market.”

The study anticipates different supply dynamics for green ammonia and green methanol as production ramps up this decade. Developments in green methanol production suggest the supply of the fuel could be concentrated in major bunkering hubs and at European ports.

In contrast, the study finds there could be global green ammonia trade, with long-distance transport of the fuel to key bunkering hubs from projects in low-cost production regions including the United States, South America, Australia, and Sub-Saharan Africa.

“While there should be more than enough green ammonia to supply first-mover ports by 2030, competition for the lowest cost volumes may be fierce and reward those able to move early in securing supply,” said Jesse Fahnestock, Director of Decarbonization at the Global Maritime Forum.

As they make plans to meet the IMO’s target for at least 5% of international shipping’s fuel to be zero- or near-zero emission by 2030, ports can play a crucial role in facilitating the adoption of zero-emission fuels this decade.

The study identifies four groups or “archetypes” of ports that could emerge in the transition, defined by common opportunities, challenges, and actions required to develop green methanol or ammonia bunkering. Based on the examples of Singapore, Algeciras, Corpus Christi, Seattle & Tacoma, and Rotterdam, the report provides tailored recommendations for how ports in each group can be pioneers in the decarbonization of the industry. The archetype framework is expected to help ports build strategies for implementing green methanol or ammonia bunkering.

“As chair of the Zero-Emission Shipping Mission, I would like to thank all the contributors to the study. International knowledge sharing on the role of ports in developing low-emissions shipping fuel markets is key. Ports can use their influence to help decarbonize maritime shipping by engaging in hydrogen import-export coalitions and green shipping corridors, and by shaping standards and guidelines for bunkering these new fuels to accelerate first mover investments,” said Sveinung Oftedal, Chief Negotiator – Green Shipping, Norwegian Ministry of Climate and Environment, and Chair of the Zero-Emission Shipping Mission under the auspices of Mission Innovation.

Read the full report here.

The products and services herein described in this press release are not endorsed by The Maritime Executive.

 

Inland Barge Designed to Transport Ammonia and Extract LCO2 Along the Rhine

HGK's concept vessel would be capable of transporting both liquified and under pressure gasses (HGK)

PUBLISHED APR 18, 2024 7:08 PM BY THE MARITIME EXECUTIVE

 

 

A German inland shipping company that already has developed expertise in transporting gases that have been liquified under pressure is previewing a new design concept that can transport both cold liquid gasses and gas under pressure. The company reports the technology which is suited both for coastal and inland shipping can play a critical part in developing the supply and disposal infrastructure to achieve sustainability goals.

HGK Group (Häfen und Güterverkehr Köln) has developed an inland vessel concept that for the first time combines the two critical gas states to transport a range of materials including ammonia as a hydrogen energy carrier as well as CO2 from carbon capture operations. Called Pioneer, the concept would accommodate significantly larger volumes than current gas tankers. The future-oriented tank and loading system technology would do away with the elaborate handling processes currently required at ports.

“Thanks to this innovative type of vessel, we’re already paving the way to meet the logistical requirements for sustainable inland waterway shipping,” says Steffen Bauer, the CEO of HGK Shipping. He explains the concept was created to provide the market with efficient alternatives using inland waterway shipping as a mode of transportation to support the green transition.

 

The tank and loading system will provide an efficient alternative using inland shipping to move liquified and pressurized gasses (HGK)

 

The Pioneer would be 443 feet (135 meters) long and 57 feet (17.5 meters) wide, giving it a significant capacity. It will have six tanks that could load ammonia in a cold liquified state. Currently, transporting ammonia requires pressurization. The Pioneer would be capable of transporting liquified ammonia held at temperatures as low as minus 33 Celsius. In addition, the system would permit the vessel to load captured CO2 in a liquified state and transport it from the inland locations where it is being captured to the coastal seaports for long-term storage or reuse.

HGK based in Cologne Germany began as a port operator and has grown to provide integrated transport and logistics. The shipping company currently operates a fleet of about 350 vessels and they look to expand on this expertise.

“The innovative tank and loading system for this special type of vessel is the result of intense development work in cooperation with international partners in the world of marine shipping and at our design center,” says Tim Gödde, the Business Unit Director Ship Management at HGK Shipping. “The technical innovations, which we’ve already used for previous new vessels, such as a diesel-electric drive concept and the shallow-water design, will also be integrated in this new type of model.”

The design was developed to provide inland access from the ports of Amsterdam, Rotterdam, and Antwerp to destinations further along the Rhine reaching the industrial centers. The design is optimized for low-water operations. While it would initially use diesel fuel, the ship will also be constructed to be future fuel-ready.

Providing the infrastructure to move these gases between the industrial centers and the seaports is one of the challenges of the energy transition. Projects are exploring pipeline connections but this would present an alternative and the first opportunity to both import and extract elements critical in the efforts to achieve industrial decarbonization and net-zero emissions.

 

World’s Largest Hydrogen-Powered RoPax to be Built at Norway’s Myklebust

Norway will build two ferries operating on hydrogen (Torghatten Nord)

PUBLISHED APR 18, 2024 5:52 PM BY THE MARITIME EXECUTIVE

 

The designs have been finalized and the shipyard was chosen for an ambitious project to build two of the world’s largest hydrogen-fueled passenger and car ferries. The project has been in development for several years with the designs initially approved in 2022 and now with the shipyard selected, Norway expects the vessels will be delivered in 2026.

“There are no other maritime hydrogen projects internationally that come close to the scale and ambitions of this project,” says Marius Hansen Managing Director of Norwegian ferry company Torghatten Nord. He recognizes that extensive time was spent developing the designs for the pioneering vessels noting that there has been a strong focus on safety and developing the Norwegian suppliers.

The project selected Myklebust Verft to build the two ferries. They are calling it a big boost for Norwegian technology and the shipyard. The project is expected to set the standard for a new class of ship and continue Norway’s leadership in sustainable shipbuilding.

The two hydrogen-fueled RoPax ferries were designed by Norwegian Ship Design. Each vessel will be approximately 380 feet (117 meters) long with a capacity to carry 120 cars and 599 passengers. Norwegian Ship Design says they will operate full-time on hydrogen requiring 5 to 6 t of hydrogen each day. They will be bunkered with hydrogen produced in Bodo in northern Norway.

The Norwegian Public Roads Administration awarded a contract to Torghatten Nord in 2022 for the construction and operation of the new ferries after a competitive bidding process which saw at least three companies competing for the pioneering project. Because the vessels will provide an essential commercial service to the residents and local fishing industry, the contract requires that they be dual-fueled, although at least 85 percent of the time they are required to operate on hydrogen. In addition, the contract requires that the hydrogen be produced with low greenhouse gas emissions with the expectation that together they will help to cut 26,500 tonnes of CO2 each year.     

“Together with the maritime cluster in Norway, we will develop new knowledge, secure jobs, and be able to take on more apprentices with this assignment,” said Leiv Sindre Muren, CEO of Myklebust Verft. “It will be exciting to deliver something that no one has done before us.”

The vessels are designed to operate the approximately 50 nautical mile run between the Norwegian mainland at Bodo to the Lofoten islands, a popular tourist destination in Norway. Currently, the route is maintained with LNG-fueled ferries that have been in service since 2012. The route requires three to four hours sailing time meaning that vessels will both travel long distances and be exposed to the harsh environment in the northern region.

The project organizers highlight that passenger traffic with hydrogen has not been carried out over such long distances and demanding sea conditions. They are saying that the vessels will be “packed with new technology.”

Torghatten Nord is involved in several pioneering projects including a self-navigating ferry in Stockholm. They are also developing long-distance battery-powered ferries.