Greek Shipping News Cuts
Week 31 - 2004


Markets lift before summer lull

---With Greek owners about to embark on their annual summer exodus, the major Asia Pacific refineries are shutting down for their annual maintenance programmes. With that comes the inevitable influx of Asia Pacific relets onto the VLCC market from the Middle East Gulf (MEG). With charterers concentrating on mid-month stems, after the rush to fix cargoes with laycans in the first half of August, rates are looking slightly fragile, albeit at very high levels. Some MEG/East stems for first-half August were fixing in the third week of July at W160 up to W190, but the market has returned down to the W140 level. Tankers International succeeded in getting one of its ships fixed for an MEG/Malacca stem last week at W190, but it was not clear whether the subjects cleared.
Still, confidence abounds because there have been 70 spot market MEG August stems fixed, compared with a total of 117 July stems and 108 June stems, according to South Korean tanker brokers. But with those Asia Pacific relets in the market, priorities are not the same as among the hard-nosed regular spot market owners. While some might be using MEG repair facilities, there could be undercutting just to get these ships fixed, which could force the regulars to concede some of the gains made in the past couple of weeks. Worldwide average earnings on the spot market in timecharter equivalents started the last week of July at about $90,500/day, from $87,000/day in mid-July, according to brokers. Finally, it has been the turn of Suezmaxes to see some upturn, with worldwide average spot market rates registering 25% gains in the third week of July, almost wiping out the losses of the first two weeks of the month. Certainly, the tighter availability of VLCCs in MEG has helped Suezmax owners east of Suez, where rate rose to about W180 for eastern discharge, from W145 in the previous week. West African rates also jumped, as charterers scrambled for tonnage for stems headed across 'the Pond'. Charterers have been keen to fix for laycans up to the end of August, pushing rates to the W170 mark, basis 130,000 tonnes stems, for US East Coast discharge, from W148 a week earlier. Worldwide average earnings, expressed in time-charter equivalents, approach $63,000 a day for modern tonnage, from about $51,000 in mid-July. Aframaxes have so far missed the party, with rates being fairly stable since the middle of July. The Mediterranean has picked up for early August stems, giving hope to owners that the main Aframax trades might soon pick up, but this has not been enough to lift the sector as a whole. The real star performer has been east of Suez, helped by the strength in the larger sizes on MEG/East trades, which were generally up about 15 points to W190, from W175 in mid-June.
Brokers are quite confident of the MEG/East market for the next week or so. They report strong cargo enquiries for August laycans. The gains in all other routes have been limited to three to five points, indicating the flat nature of all Aframax trades west of Suez. The one other bright spot seems to be for the larger sizes capable of lifting 100,000-tonne stems in the Baltic. Brokers report that tonnage is fairly well matched to supply but note a fairly steady stream of cargoes. Dirty products Panamax owners heard little good news, as rates continued to decline, marking July as a month of continual rate falls. So far there is no sign of the US refineries gearing up for the winter heating oil season. Instead, they are concentrating all their efforts in meeting summer gasoline demand to keep all those gas-guzzling SUVs on the Great American Highway. So the Caribs upcoast market is looking decidedly moribund. And July has not been a great month for clean-products owners, either. Despite US demand for gasoline, that trade from the Caribbean to the US Gulf and Atlantic coasts has been particularly slow. US refineries prefer to meet the requirement by refining imported crude. In the third week of July Caribs/upcoast rates were generally down by about $3,000 a day in timecharter equivalents, to $17,000 daily. The one trade to buck the trend has been MEG/India West Coast, where rates have risen by about 45% to nearly $27,000/day, from $18,000/ day in mid-July. This was caused, analysts say, by tight tonnage availability and a steady stream of cargoes to meet increasing Indian gasoline demand.
Source: Fairplay International Shipping Weekly, 29 Jul 2004

Piraeus 'shortlists two firms' for ISPS Code port contract
---PIRAEUS is understood to have short-listed two companies to draw up its International Ship and Port Facility Security Code plan, on which it has not commenced work, more than four weeks after the supposed implementation deadline.
With the start of the Olympics little more than a fortnight away, the issue of counter-terrorist measures at the port is attracting increasing attention.
Eight cruiseships, including the Queen Mary 2, are due to dock there for the duration of the games, acting as temporary home to 13,000 upmarket guests including several heads of state.
But while security will inevitably be extremely tight while the big wigs are in town, it appears that this has been at the expense of the kind of day-to-day security measures embodied in ISPS.
Sources close to the ISPS tender say that bids from Control Risks Group and an alliance headed by Greek company European Security are actively being considered.
However, rejected companies - which include some of the top names in maritime security - still have a chance to appeal against their rejection, and some are planning to do so.
This will have the effect of delaying further the award of a contract.
Lloyd's List understands that Maritime and Underwater Security Consultants and a Group 4 Falck subsidiary Wackenhut Hellas are among the companies that did not make the cut.
Control Risks yesterday said it did not wish to comment on whether or not it was in the running.
Independent confirmation from the port authority was also not available.
It also seems that the eventual winner will be doing the job more for reasons of prestige than profit.
Meanwhile, Piraeus has become the 20th port worldwide to sign up for the US-led Container Security Initiative.
The US is reportedly helping out ahead of the Olympics with the loan of two X-ray scanners capable of checking a 40 ft box inside one minute.
Around 35 Greek naval vessels have started Olympic security patrols of Greek waters, while Nato ships are covering farther out at sea.
Any merchant vessel displaying "suspicious behaviour" could be subject to inspection, Associated Press reported.
Indeed, some 70 have been searched in recent weeks, with no threatening discoveries.
Source: Lloyds List, Company News, By David Osler- Thursday July 29 2004

CSI now implemented at world's 20 busiest ports
---WASHINGTON, DC - The Container Security Initiative (CSI) has become operational at Piraeus, Greece, which means the world's 20 largest container seaports are now partners in the maritime security program.
As part of the CSI program, CBP officers are working with host government personnel as part of CSI, to target cargo containers that pose a potential risk for terrorism destined for the United States. Greek Customs officials will inspect containers identified as a potential terrorist risk.
Greece is the 18th country to enter into a CSI agreement with the United States.
CSI, a U.S. Customs and Border Protection initiative launched in January 2002, is operational at 20 of the world's major seaports in Europe, Asia, Africa, and North America.
CSI is expanding to Greece before the start of the Olympic games in two weeks.
In order to jump start CSI in Greece, CBP is loaning Greece two large-scale, whole container x-ray machines, so that the security protection of CSI can be in place before the Olympics this summer and are there in time to contribute to the security of the Olympics.
This equipment is an essential part of CSI, because it allows the screening of targeted containers rapidly without slowing down the flow of movement of legitimate trade. Customs officers use these large-scale x-ray imaging systems to safely and efficiently screen conveyances for potential terrorist weapons, including weapons of mass destruction.
This equipment produces an x-ray type image of the interior of a full-size 40-foot container in under a minute. As part of CSI, Customs officers also use radiation detection devices to scan for signs of radioactive materials.
If necessary, containers are opened and unloaded by the host government Customs service for a more intensive manual inspection.
Source:, 1 Aug 04

Unprofitable ferry routes will cost taxpayers euro 44m
---The government has committed some Euro 44m in subsidies to maintain unprofitable ferry services in 2004 with that amount likely to top Euro 55m in 2005. Marine minister, Manolis Kefaloyiannis confirmed this when announcing that the servicing of most of the country's unprofitable routes was now assured following the latest round of licence approvals.
"We can not expect shipowners to pay for a government imposed social policy. To do so would be fraud," said Kefaloyiannis. He went on to say the government "would not even consider" a plan put forward by the previous socialist government to build up to eight ships to undertake the service of these routes.
Meanwhile, the Aegean and Island Policy minister, Aristotelis Pavlidis scored a major victory within the corridors of the EU when he secured an agreement that Greece's islands are an extension of the mainland and should be treated as such, thus making them eligible to receive additional EU funding for infrastructural works, especially those dealing with communication and with ports.
Kefaloyiannis and Pavlidis have been holding a series of meetings with the mayors of the Dodecannese and Cycladic island groups to discuss infrastructure. The islands are keen to receive funding from the EU's Fourth Package for regional development, especially with a view to improving port facilities.
Source:, 29 jUL 04

Greek navy patrols its coast for signs of 'suspicious ships'
---Dozens of boats monitoring coastline as part of Olympic security plan
Coast guard officers patrol the Saronic coastline earlier this month. At least 35 vessels will be monitoring the Aegean, the Ionian and the coastline of Crete and the Cyclades during the Olympics.
Dozens of Greek navy vessels have started Olympic security patrols as part of a two-zone buffer that includes Greek ships in coastal waters and NATO warships farther out at sea, a naval official said yesterday.
At least 35 Greek ships are monitoring the Ionian Sea along Greece's west coast, the Aegean Sea and areas off the coasts of Crete and the resort Cyclades islands.
The ships are checking "any ships with suspicious behavior," a navy source told The Associated Press on condition of anonymity.
About 70 vessels have been inspected by Greek forces in recent weeks, but there have been no indications of cargo or personnel considered possible threats to the August 13-29 Games, the source said.
The inspections will increase as the Games approach, the source added. About 10 navy helicopters and two military patrol aircraft are assisting the ships.
Maritime protection has taken a prominent role in Greece's 1.2-euro-billion (US$1.5 billion) security network.
Greece - with a coastline of 15,000 kilometers (9,320 miles) and some 6,000 islands and islets - is a major destination along illegal smuggling routes for immigrants and goods.
Some global security analysts also predict that Al Qaeda or other terrorist groups could be studying possible attacks on shipping lanes and other targets at sea.
More than 200 naval commandos are stationed at seaside Olympic venues, including the Aghios Cosmas sailing venue and the triathlon area in Vouliagmeni on the coast near Athens.
Off the port of Piraeus, about 10 kilometers (6 miles) south of central Athens, a frigate with about 200 sailors will watch over at least eight cruise ships that will serve as floating hotels for heads of state and other dignitaries. The first of the cruise ships is expected next week.
Another frigate is patrolling the southern coast all the way to Sounion, site of an ancient temple to the sea god Poseidon about 50 kilometers (30 miles) southeast of Athens.
NATO plans to dedicate its entire Mediterranean fleet of about 15 vessels to Olympic patrols in international waters.
Source:, 29 Jul 04, By Lisa Orkin - The Associated Press

P&I clubs draw swords in battle for hearts
---THE mutual insurers that cover liability claims for most of the world's fleet, the Protection and Indemnity (P&I) clubs, usually keep their heads down when it comes politically sensitive issues.
Mishandling: According to London Club chief executive, ill-judged policy decisions and lack of independent and transparent inquiries have stood in the way of identifying mistakes in the handling of the Prestige incident, which caused the worst environmental tragedy in Spain
They do have quite lot to say, but usually on subjects such as the need to stick to regulations for avoiding collisions or the best way to avoid cargo damage. Recently though two prominent P&I figures have ventured into the political arena.
London Steamship Owners Mutual Insurance Association's (London Club) latest annual report includes a detailed critique of Spain's handling of the Prestige case. The ill-fated tanker was entered with London Club.
The chief executive of London Club's managing company A Bilborough & Co had some forceful things to say, though he later emphasised that he was hoping a more positive approach from the new Spanish government.
He contrasted the approaches to marine casualties in the UK and Spain. He noted that while the UK had independent and transparent inquiries which 'got to the bottom' of the causes of accidents, 'there appears to be no such transparent process in Spain'.
The result, according to Mr Hinton, was not only that mistakes in the handling of the Prestige incident have not been identified but problems have been actually compounded by ill-judged policy decisions in response to the incident.
It has to be said that the London Club's report does include some of the strongest language that I can ever remember a P&I club using about a government, including the following: 'To those familiar with the case of the Prestige, the reported unwillingness of the former government to acknowledge promptly the likelihood that international terrorists were responsible for the Madrid atrocity on March 11 may seem to resemble its refusal to concede that it would have been preferable to have offered the Prestige a place of refuge.'
Mr Hinton's remarks conclude with a plea to the new Spanish government. He says: 'It is to be hoped that the new government will bring a more constructive approach to the resolution of the variety of issues which have arisen from this case.'
London Club members, who include many Greek owners, clearly feel strongly on this issue. But there is a deep-seated feeling among owners that they are the subject of continual, and unjustified political attacks.
Reflecting that feeling, North of England Club's claims director Ian Henderson says: 'Shipowners need to speak with one voice if they are to stop the seemingly unrelenting campaign by the world's governments and public authorities to penalise and criminalise the shipping industry.'
He says in the latest issue of the club's newsletter North News: 'An industry that generates over US$ 200 billion in income, employs two million people and carries 90 per cent of international trade is one that governments and public authorities cannot afford to ignore.'
According to Mr Henderson, this month's introduction of the International Ship and Port Facility Security (ISPS) Code is the latest example of increasing difficulties facing the shipping industry.
The club's associate director Colin Trappe says: 'In addition, we have the all-new 1996 Hazardous and Noxious Substances convention, the 2001 Bunkers convention, a 500 per cent increase in passenger liability proposed by the 2002 protocol to the Athens convention and the draft Wreck Removal convention.'
The club says increasing criminalisation of seafarers - particularly when there is no evidence of criminal intent or recklessness - is also undermining the shipping industry, with the possible result that masters may now retire early rather than risk spending their final working years in jail.
From a shipping community perspective, Mr Henderson says the hostility of governments and public authorities seems disproportionate given that the shipping industry is already highly regulated, has a safety record envied by many shore-based transport sectors and is the most environment-friendly form of commercial transport.
'Society perhaps needs reminding that the 40,000-plus ships that ply the world's oceans are highly sophisticated vehicles capable of operating efficiently and independently in some of the world's harshest environments - not the 'unreliable rust buckets' that the headline writers would have the public believe,' says Mr Trappe. He also points out that international trade in essential commodities relies on a healthy shipping industry.
The club argues that the 'real push' for change must come from shipowners directly, ideally through their national shipowner associations but more significantly through international organisations such as the International Chamber of Shipping, Bimco, Intertanko and Intercargo - which together form the Round Table of international maritime associations.
As the North of England's final remarks indicate, it really is the business of other groupings, and not P&I clubs, to fight the battle for the hearts and minds of the general public.
Nevertheless, it is interesting, and welcome, that the P&I clubs too feel able to add their voices to industry concerns on major issues. We could do with more of the same.
Source:,By DAVID HUGHES, 28 ul 04

Putting the Top Tankers deal in perspective
---Like just about every shipping deal that comes to the capital markets, the ship finance community ripped the Top Tankers deal to shreds after the S-1 was filed. And after the deal came to market and the stock fell from $11 to $10, people felt vindicated. We take a slightly different view on this deal. First off, we were amazed at how quickly it came. We estimate that there were only about 90 days in between the day that Anthony Argyropoulos brought the deal to DVB and the day that it priced. That is incredible, and it should be a reminder to all of you companies that want to go public but are afraid of missing the market that there is hope. The second thing that impressed us was the fact that the company was able to put a deal together with so many contingent pieces (the ships from Sovkomflot, the loan from RBS, the charters to Glencore and Vitol - and the mother of all variables, the equity market.) Finally, we were amazed that DVB was able to achieve equity and debt distribution through what will likely blossom into a joint venture with Cantor Fitzgerald so quickly. So we thought it would be useful to put this deal, which is now trading above its offering price, into a broader perspective. As the chart below indicates, Top came to market at a very ugly time for the IPO market and has actually performed quite respectably.
Source:, 29 Jul 04

EM Capital hired by Greece's Dane Sea Line to resume sailing for Olympics
---With Athens 2004 Olympics only three weeks away, Greece's Dane Sea Line appoints EM Capital/FreemanPartners as Turnaround Manager and Restructuring Agent
SAN FRANCISCO/EWORLDWIRE/July 26, 2004 --- EM Capital/FreemanPartners, the international turnaround management and restructuring advisor, has been hired to serve as Turnaround Manager and exclusive financial advisor for Greece's Dane Sea Lines. Dane Sea Lines operates three large passenger and cargo ferries between the Port Piraeus and the island of Rhodes, as well as the Dodecanese islands of Patmos, Leros, Kalymnos and Kos. The routes are particularly popular with tourists who flock to Rhodes' beaches and casino during the summer months.
Operations recently came to a halt due to a lack of operating cash. Dane Sea Lines is a Greek public company that has been de-listed from the Athens Stock Exchange due to continuing losses. Serving as Chief Restructuring Officer (Interim CEO) is Gabrielle Traboulay, an Athens-based Greek-American known in Greece for the dramatically successful restructuring and re-listing of Balkan Paper Export Company. Seth R. Freeman, CIRA, CEO of EM Capital Inc., will serve as Interim President and CFO with immediate responsibility for arranging $10 million of foreign capital to fund the restructuring. Traboulay and Freeman will join the company's board of directors.
"We are very pleased to have this opportunity to once again restructure one of Greece's most important companies with a view to preserving value for shareholders, jobs for our employees and the economy of Rhodes. We look forward to welcoming in Greece both tourists for the Summer Olympics and all of Dane's domestic customers to a well run operation, with excellent customer service, within the ten days," stated Traboulay in Athens.
Freeman stated, "The appointment of EM Capital Inc by Dane's board, with the endorsement of its major shareholders and creditors, validates our firm's global strategy of applying proven turnaround management skills and restructuring expertise to distressed foreign firms requiring these important services. EM Capital's ability to commence its work within 24 hours of the engagement played an important part in winning this assignment. We are highly confident in the future of Dane Sea Lines under the extraordinary leadership of our partner, Gabrielle Traboulay. We are also lucky to have large assets that can be used to collateralize the required financing to kick-start this exciting restructuring." []
Source:, 26 Jul 04