Greek Shipping News Cuts
Week 40 - 2004


Merchant shipping sector expects gov't to offer solutions, not set up committees

---With officer training in urgent need of upgrade, ministry has opted to shelve recommendations
News that the Greek merchant shipping sector - the country's major foreign exchange earner - is projected to bring in $13 billion this year coincided with the Athens Olympics and the achievement of new world records. As a result, the news did not receive much publicity, although the amount will be about double the cost of the Olympics.
The 3,500 oceangoing, Greek-owned vessels, totaling a capacity of 150 million deadweight tons (dwt), are indeed an invaluable "national capital." Their leading position in the world is due to the dedication, hard work, inventiveness and seamanship of Greek merchant marine crews, especially of the officers.
Merchant shipping's international character and the fact that employment in the sector is not limited by national boundaries leads to many foreigners working on Greek-owned ships, as their owners seek to make up for the shortage in domestic human resources. This practice, however, leads to the loss of the Greek "profile" of the country's merchant navy, amounting, in a sense, to the exportation of jobs at a time when the younger generations face unemployment.
The Greek shipping sector expects neither financial assistance from the government nor favorable treatment in business orders, such as provided by other countries to their national fleets. It does, however, expect proper organization of the sector's job market and the required education and training of its seamen. Merchant Marine Minister Manolis Kefaloyiannis decided recently to set up a committee to report on the subject. However, his party had also formed such a committee when in opposition, which worked - without remuneration - for four full years toward the same purpose, leading to proposals which were endorsed by Prime Minister Costas Karamanlis when he announced his government's program. The current general secretary of the Merchant Marine Ministry was in fact a member of that committee.
So, the question arises as to what the new committee will seek to achieve. Moreover, what will the ruling party have to say to its own people who offered their services free in preparing policy papers for the current government? Will it be: "Thanks but no thanks. We now have a new committee... your efforts are not appreciated?"
In Greece, education and training for people wanting to work in the merchant navy depends solely upon the public sector. It is not organized in such as way as to be supportive to the sector, but in order to serve the aims of special interests which no one dares to touch. Another internationally unique feature of seamen's education and training in Greece is the complete absence of the private sector. The Merchant Marine Academies (AEN), a part of the country's higher education system, attract young people not because they wish to become officers on merchant ships, but because they are able to enter these schools with extremely low grades. Almost no other tertiary education system admits students with such low grades.
In all other countries with a merchant marine tradition and according to the international agreement STCW/95, academies train officers through specific, set programs which include training at sea. It is only the most able who make it through the three stages of training to the A-class diploma.
It is often heard from people with supposed seagoing experience: "How can you entrust an oceangoing vessel with 1,500 passengers and more than 1,000 crew members to a captain without a university degree?" Of course, they forget that seamanship and knowledge require "contact" with the subject that cannot be acquired by sitting in a classroom. Besides, the sector today is developing fast, technological applications are spectacular, while the conditions for sea trading and ship operation are also changing. All this means that people employed on ships must in fact be trained and retrained throughout their professional lives.
However, the new government, instead of proceeding to upgrade and modernize education and training for the merchant navy, has assigned the issue to yet another committee. This shows a perpetuation of the old mentality and maintains the widespread impression in the sector that the ministry does not tackle the real problems. In the six months the government has been in power, it could have done so much on the basis of the comprehensive report that was prepared after the broadest possible consultation with interested parties.
Source: By Dimitris Kapranos - Kathimerini, 1 Oct 2004

Mangouras loses latest appeal
---THE judge investigating the Prestige case has rejected the latest appeal by lawyers acting for the ship's Greek master, Apostolos Mangouras, to allow him to travel home to Greece, writes Brian Reyes in Gibraltar. The decision comes despite firm assurances from the Greek government that Capt Mangouras, 69, will return for trial in Spain once a date is set. Lawyers acting for the Spanish government say they would not oppose a lifting of the travel ban.
Source: Lloyd's List, Thursday September 30 2004

Mitropoulos focuses on maritime security
IMO Secretary-General Efthimios Mitropoulos has made security the focus of his first World Maritime Day message to the international maritime community.
He commended governments and the shipping industry for their efforts in ensuring the timely implementation of the IMO maritime security measures, including the International Ship and Port Facility Security Code - the ISPS Code, which were adopted in 2002 and entered into force on 1 July 2004.
But he warned against complacency saying: "Now that the new international maritime security measures are in force, we must not make the mistake of resting on our laurels and assuming the work has been completed. The risks are too high to allow for any hint of complacency and we must make sure that high levels of vigilance and awareness are maintained and built upon until they become second nature throughout the shipping and port industries. Terrorism is not a matter of concern to one country or a group of countries - it is a global issue that affects us all and we should spare no effort to ensure that, together, we build a robust and resilient defence."
He added that, in a broader context, IMO's work in the realm of maritime security also provides support for its objectives in enhancing safety and also preventing pollution of the marine environment. "The detrimental impact on the environment of a successful attack on a ship laden with oil, chemicals or other hazardous or noxious substances could be immense and, by raising our defences against terrorists, we are providing further protection in this respect."
Source:, Thursday, 30 September 2004

Fosen may start rebuilding of Greek ferries
---Fosen Mek. Verksteder hopes to start the rebuilding of two Greek ferries and the completion of a third ferry before the completion work on the two ropax vessels for Stena RoRo starts in November next year, when the first hull from Baltiysky Zavod is scheduled to arrive. Fosen is also pitching for a gas ferry project in cooperation with Fosen Trafikklag and Marintek. Reidar Gullesen, a spokesman for Fosen, says that a final decision on the Greek ferries is expected shortly. Fosen has a long-standing relationsship with Greek ferry operators and has built three ferries for Minoan Lines and two for Anek Lines. (30.09.04)
Source: The Scandinavian Shipping Gazette, Newsletter 37, 2004

Med Mepas launch joint attack on marine pollution
---Politics have been pushed aside by three marine environment protection organisations located in the East Mediterranean in an effort to better protect the sea environment. The marine environment protection associations, Helmepa of Greece, Cymepa in Cyprus and Turmepa in Turkey are to join forces to cooperate more closely to curb pollution of the sea.
Recognising the coastal regions of the Eastern Mediterranean and Black Sea are characterised by dense populations, increased human activity such as tourism, urban development, industry and maritime transport the associations are to launch a uniform campaign to increase public awareness of the individual's role in preventing pollution from ships and land-based sources. They also plan to expand the Mepa concept to the six countries bordering of the Black Sea, the area seen "as the
greatest long-term threat" to the region.
During a joint meeting hosted by Helmepa in Athens, September 24, the three associations agreed a four point objective: Project pollution problems along the coasts in their true dimensions; Contribute to the environmental awareness of local communities; Inform and motivate all those concerned of the need to cooperate; and Promote the Mepa spirit throughout the Mediterranean Sea.
In a joint statement the three criticised coastal cities' lack of sewage treatment plants and ports which "do not provide adequate shore reception facilities for merchant shipping, fishing and pleasure craft". The statement said that "due to the geological disposition of the basin on the one hand, and the prevailing winds and water currents on the other, it is possible for solid wastes from different kinds of sources to become engulfed in various coastal areas".
Key to achieving the goal is to pursue the objectives through the cooperation between Helmepa Junior and the equivalent sectors of Turmepa and Cymepa. Schoolchildren in the three countries will be organised in a uniform way in groups, according to age, to execute the same activities in their regions. A network to connect the three Junior sectors is to be established so data, proposals and experiences can be exchanged.
Participating groups may compete between themselves for the privilege to participate in a programme of exchange visits between the three Mepas. The three associations will endeavour to win publicity in each country with the aim of getting state authorities to support the efforts of the children.
Helmepa and Cymepa will also make this cooperation known to the European Commission and look at ways in which the EC could provide support through environmental programmes.
The issue of the "Environmental Awareness in Youth as executed by Helmepa Junior" is a recurrent subject of the MEPC (Marine Environment Protection Committee) of Imo and it is suggested the three Mepas urge their national delegations to Imo to work to keep the issue alive within the wider maritime community.
The three Mepas will aim to jointly produce a simple guide on marine pollution prevention, in each national language and one in Greek, Turkish and English, to be distributed at their own discretion.
In a joint statement, the three bodies said: "We believe the greatest long-term threat to our region will come from the Black Sea because of the ever increasing dumping of waste, petroleum products and hazardous materials by shore-based industries. The northern part of the Black Sea is already an environmental disaster zone and inevitably the pollutants will be washed out through the Turkish Straits and into the Aegean and Mediterranean seas affecting us all. We would like to propose we work together to promote and assist in establishing Mepas in the six countries bordering the Black Sea in order that they might also promote the considerable improvements that all the Mepa organisations have achieved in their own countries."
Finally, the three Med Mepas believe that by working under the Intermepa umbrella they will have access to increased lobbying, fund raising and implementation resources.
Saluting the meeting's initiative, Greek Marine minister, Manolis Kefaloyiannis underlined that ships are not the main culprits for the pollution of the Mediterranean and Black Sea. He strongly supported the work of the three associations, saying that "the cooperation between countries that have a close connection to the marine element can only have positive results".
Aegean & Islands Policy minister, Aristotelis Pavlidis pointed out that "pollution recognises no borders" and said his ministry is present whenever needed for the success of this environmental cooperation.
Source:, 30 Sep 04

Cruise ship collides with oil tanker
---A CRUISE ship with 500 passengers on board has collided with an oil tanker in foggy conditions off the southern coast of Spain.
The Van Gogh, registered in the Grenadines in the Caribbean, collided with the Greek-registered Spetses tanker, carrying 140,000 tonnes of crude, off the Bay of Algeciras. The crusie ship had just left port at Gibraltar.
"Fortunately, nobody was hurt," said a local government official at nearby Cadiz. Authorities said there was little damage to either vessel and no oil had leaked. They blamed the collision on poor visibility and said the cruise ship appeared to have been travelling at a greater speed than that warranted by the conditions.
The Van Gogh was en route for the Moroccan port of Tangiers, while the Stepses was returning to port at Algeciras from Egypt.
Spanish officials said the Van Gogh returned to port following minor damage to its bow, while the Spetses was towed to its refinery berth after suffering a dented hull.
Source: /, From correspondents in Madrid, 27sep04

Greek tanker grounded in Storebaelt
--- Danish Authorities is on alert after the grounding of a Greek owned tanker in Storebaelt yesterday. The Liberian-flagged tanker "Fotini Lady" ran aground on a voyage from Klaipeda, Lithuania, with a cargo of 63,000 tonnes of gas oil. The tanker is almost new and built with double hull, so there is no immediate danger of leaks from the cargo tanks. The tanker hit the bottom at Hatterbarn on the passage toward the Skaw apparently without a pilot on board. The "Fotini Lady" was delivered in February 2004 from STX Shipbuilding Co in Chinhae, Korea. It is of 71,865 DWT. Salvors are working with several solutions to get the tanker off the ground, most likely she will have some of the cargo transferred to a smaller tanker and then taken off with tugs.
Source:, 1 Oct 2004

Stelmar proxy headed to vote
---While Stelmar shares trade into the hands of arbitrageurs betting on the outcome of the current takeover efforts of Fortress Capital, proxy documents necessary to meet SEC rules for a foreign lister are under preparation by company advisors. The proxy, which is expected to be received by shareholders within two weeks recommends acceptance of the Fortress offer.
Vocal critic of the transaction, Stelios Haji-Ioannou, begins to discredit his own efforts by criticizing Stelmar management without making any sweetened offer himself. A completely unsubstantiated market rumor has Stelio's sister selling her 1 million shares.
Meanwhile, other companies with a view on Stelmar's value continue to consider alternatives.
The proxy needs just 50% plus 1 share of the vote to succeed. The company will obviously be visiting and speaking to main shareholders to secure the outcome.
Experience tells us that now is the crucial time as arbitrageurs speculate on the stock, alternative offers come up and major shareholders sharpen their spreadsheet models to extract the last penny.
A fourth quarter close is expected by the company which insists that it conducted a comprehensive bidding process with the help of Jefferies and Morgan Stanley since the OMI offer last spring.
While Stelmar notes the Fortress offer is 55% stronger than OMI's, it must be noted, shares are up almost 18% since OMI made it's offer.
Source:, 1 Oct 2004

Tanker stocks 'valued too low'
---Michael Joliffe, deputy chairman of Tsakos Energy Navigation, cannot help asking how much is too much when it comes to tanker stock evaluation. In an issue that has raised repeated disputes, he asked delegates at the Jeffries International Shipping conference in New York: "Do companies that return 25% on equity deserve price per earnings (P/E) ratios six times earnings?" Some analysts ask the same question, while others seem to feel that six times is plenty. Tsakos Energy Navigation (TEN) has its headquarters in Greece and is listed in Oslo and New York. In recent days its share has traded close to 52-week highs, reflecting the good times being enjoyed by shipping stocks in general. Its price of $34.10 in New York reflects 7.05 times its earnings, while earnings per share stand at $4.83. With a dividend of $1 per share, investors get a 2.94% yield on their money.
Joliffe compared the tanker business, which is awash with money these days, with the offshore drilling sector, which in bad times is awash with laid-up rigs. However, the valuation of these companies "deserve P/E ratios 33 times earnings" while TEN gets about six, in Joliffe's opinion. In fact, a P/E ratio in the region of 15 would do more justice to the performance of his company, Joliffe declared. Analysts at Hibernia South Coast Capital supported Joliffe's views: in a report dated 2 September, the anaysts set a target price of $38 for the stock and suggested that customers buy the stock. Sven Lorenz, a UK-based financier, also supported Joliffe in a commentary published on the internet in a resource called The Daily Reckoning. "If the typical oil tanker owner managed the company from his local coffeehouse, there wasn't much point in attributing any value to the company's organisation, its brand name or its track record," he wrote. Thus, the TEN valuation on net asset value was justified, Lorenz asserted.
Things are changing, however: quality, competence and transparency add value to businesses and the entity is more than the sum of the components that make it up , he pointed out. "The lack of transparency within the industry led to valuations hardly ever venturing into double-digit P/E territory. By and large, oil tanker shares traded at P/Es of 5-8, which is low compared to the general stock market," Lorenz wrote. Cash flow should take over from net asset value as the key factor to value tanker stocks: "Indeed, the sector has three factors weighing massively in its favour right now: a low stock market valuation, at least two more years of high charter fees, plus the increase in the sector's visibility and therefore valuation." These are views of the bulls. Those with more cautious inclinations, including Smith Barney Citicorp in New York and Lorentzen & Stemoco in Oslo, noted that the industry remains cyclical, the duration of the current boom is hard to forecast and the more exposed to the spot market you are, the quicker you will suffer when the spot rates pick a southerly course. That took the discussion back to square one: for how long will tanker stocks return 25% on equity?
Full company name: Tsakos Energy Navigation Ltd
Domicile: Bermuda
Headquarters: Athens
Founded: 1993 (as Maritime Investment Fund Ltd)
Listed: New York Stock Exchange and Oslo Exchanges
Share price: $34.11 on 23 September, 52-week high $35.50, low $14.16
Latest financial result: 2Q04 net profits of $30.2M, versus $18.3M in 2Q
Source: Fairplay International Shipping Weekly 30 Sep 2004

Latsis group in row over lost yacht
---The rather embarrassing loss of a royal yacht during a major refit has led to a row between a crowd of marine underwriters and the Latsis shipping group.
The insurers are refusing to pay for the destruction by fire of the 965-gt super-yacht Al Riyadh (built 1978) while it was being refurbished by Latsis group companies in Greece early this year.
The vessel does not appear in league tables of the world's largest yachts because of the owner's reclusive profile. It was built in the Netherlands for the Saudi royal family at a cost of more than $100m.
Underwriters claim John S Latsis (London), Latsis-controlled Lamda Shipyards at Elefsina in Greece and another group company, Sete Technical Services, as well as the Saudi interior ministry and Saudi government-owned National Co for Cooperative Insurance, were guilty of material misrepresentation and non-disclosure over the insurance of the Al Riyadh.
The deceased Greek shipowner had close dealings with the Saudi royals - not to mention a number of other royal families - and is reputed to have helped oil the wheels of his extensive business interests in the kingdom through the trifling gift of the 209-ft yacht Shahnaz (built 1981).
The insurers who have rejected the Al Riyadh claim are led by Martin Reith's Ascot Underwriting operation at Lloyd's, which is backed by the American International Group (AIG).
Others supporting the move against Latsis include top insurers such as Allianz, Axa, Royal & SunAlliance, GE Frankona, If P&C and the Norwegian Hull Club.
The dispute is heading for the High Court in London but there is still a reluctance to air details in public.
It appears that alleged breach of the conditions of a deal between the Latsis group and underwriters lies behind the row.
Underwriters typically require notification and prior agreement to especially hazardous operations that pose a fire risk, such as welding and other hot work, and then impose conditions about the way this should be carried out, the precautions to be taken and limiting the period when they are exposed to claims.
Latsis, a self-made billionaire who died at age 93 last year, was the last of the "Golden Greeks". He laid the foundations of a $5bn fortune by carrying Muslim pilgrims to Mecca and then diversified into oil trading, tanker ownership, construction and banking.
The loss of the Al Riyadh is, however, likely to be more troubling for the Latsis group than the Saud dynasty, which has a flotilla of at least six super-yachts on hand should members of the family feel for a boating trip.
Source:, Jim Mulrenan London, published: 01 October 2004

FYROM gov't minister cites compromise with EL.PE over pipeline company
---SKOPJE (ANA) -- State-run Hellenic Petroleum (EL.PE) and the government of the Former Yugoslav Republic of Macedonia (FYROM) have reportedly reached an agreement over a new management scheme for a crude oil pipeline connecting the northern Greece port city of Thessaloniki with the land-locked country's capital, Skopje.
FYROM Economy Minister Stevco Jakimovski told local reporters over the weekend that he reached an agreement with EL.PE officials in Thessaloniki on Friday to begin operation by Nov. 1 of a joint company managing the pipeline. EL.PE will retain an 80-percent share of the company, with the state of FYROM controlling the other 20 percent.
The pipeline was exclusively managed and exploited by EL.PE over the past two years via a company set up by the Greece-based refinery and retail outlet group.
Another pending issue between EL.PE and the Skopje government involves a 1999 deal by the former to purchase the state-owned OKTA refinery in the FYROM capital, as certain provisions in the purchase contract were heatedly criticised by the government that assumed power in that country in 2002.
EL.PE has requested international arbitration to resolve the issue. However, a suspension of legal action could allow both sides' experts to workout a compromise deal, press reports here estimated.
Source:, 3 oct 04