Greek Shipping News Cuts
Week 08 - 2005


Greek seafarers on the brink of strike action

---GREEK seafarers are set to strike on Tuesday and Wednesday next week unless talks between seamen's leaders and the country's ministry of merchant marine today produced a breakthrough.
While it has been reported that Greek vessels internationally may not be affected, the action is likely to paralyze passenger tonnage in Greek ports. Unions have said that the two-day strike may be extended if demands are not met.
The Panhellenic Seamen's Federation, which represents 14 different seafarers' unions, has set action on unemployment as its key concern, calling for improvements to benefits as well as a hike in retirement lump sums and monthly pensions.
It has also voiced concern about a recent change in manning quotas on board Greek flag ships although the government insists that the amendment means that the number of jobs on board will stay the same or actually increase by one per ship.
There was no immediate indication of the outcome of talks this afternoon, although earlier in the week minister Manolis Kefaloyiannis pledged progress on at least some of the union's demands.
"Many of the demands of Greek seafarers are justified", he said. "This is the official view of the ministry.
"We look on the problems of seafarers with sympathy," he added. "Some of the just demands should have been solved years ago."
The minister picked out improvements to retirement schemes and tax on seamen's salaries as being among areas where he saw the need for action to help the profession.
According to the PNO as many as 7,000 Greek seafarers are out of work, but the fall-out from recent passenger shipping company bankruptcies has angered unions.
Mr Kefaloyiannis said that the ministry has authorized the country's seamen's pension fund to pay out E 350,000 to help 200 seafarers recently redundant due to the bankruptcy of Royal OIympic Cruises, following a similar order for E 1.2m to go to employees of the long-ailing ferry firm Dane Sea Lines.
Greek shipping, buoyed by high freight rates in all the main sectors, contributed a record E 13.3bn to the country's foreign exchange earnings last year, up almost 40% from its contribution in 2003, according to Bank of Greece statistics.
Source:, Breaking News, By Nigel Lowry in Athens - Friday February 25 2005

Year later, Bow Mariner investigation wrapping up
---A year after one of the region's deadliest ship explosions, the investigation into the sinking of the chemical tanker Bow Mariner off of Virginia's coast remains under wraps - except for one salient conclusion:
"Twenty-one people didn't need to die," said Jerry Crooks, chief investigator for the Marine Safety Office in Norfolk.
"This accident should not have happened."
As Crooks and his staff wait for their report to work its way up the chain of command at Coast Guard headquarters in Washington, he chooses his words carefully to avoid disclosing the investigation's findings or recommendations before final action.
Release of the document is expected to be months away.
But Crooks and his team feel they have gotten to the bottom in their inquest.
"We know what happened," he said. "We know why it happened. There are a lot of issues peripheral to the actual explosion, regarding the management of the ship."
Only six crewmen survived the Feb. 28, 2004, blast 50 miles east of Chincoteague off Virginia's Eastern Shore.
They were rescued from an oil-soaked life raft by Coast Guard helicopter crews responding to a frantic "Mayday" distress call from a crewman who yelled into his radio: "This is Bow Mariner, Bow Mariner. We are on fire."
It was just after 6 p.m.
The bodies of three men - two of whom were recovered alive but died en route to hospitals - were recovered. But 18 others are missing.
The Bow Mariner, a 570-foot -long, 40,000-ton tanker, exploded with 27 aboard - three Greek officers and 24 Filipino crewmen. Carrying 3.2 million gallons of industrial-grade ethanol, plus 200,000 gallons of No. 6 fuel oil and 53,000 gallons of diesel oil, the chemical brew erupted and became an inferno that left a 500-foot ring of fire around the ship, according to witnesses.
While it took 84 minutes for the Bow Mariner to be swallowed up by the Atlantic, falling bow-first into 258 feet of water, crewmen described the initial explosion as sudden and violent, preventing them from getting to life jackets initially, and forcing some to dive from the upturned stern.
The Bow Mariner, built in 1982 in Yugoslavia, was owned by Odfjell ASA of Norway, which owns or charters 96 other tanker ships around the world. A portion of the fleet, including the Bow Mariner, was operated by Ceres Hellenic Ship Enterprises of Piraeus, Greece, which employes about 3,000 crew members for those and other tankers, oil carriers, bulk containers and liquid natural gas carriers.
The Bow Mariner had picked up its cargo in Saudi Arabia about a month before, sailed through the Suez Canal, then headed straight for New York, where it discharged some of its product to four customers.
On Feb. 27, it sailed on what is considered a mundane "milk run" that takes the tankers down the Atlantic coast, around the Florida Keys and on to Houston, Texas, where its parent company operates its largest U.S. plant, a mammoth storage-tank farm.
Losing Bow Mariner the next day was the first fatal accident in 10 years for Odfjell, according to its president and CEO, Terje Storeng.
Then three months later, another Odfjell tanker, the NCC Mekka, had an explosion in one of its chemical tanks while steaming 60 miles off the coast of Rio de Janeiro. That killed two crew members.
The ship was saved by the crew, who extinguished the fire within 25 minutes, according to Odfjell. The explosion began in a tank that was being cleaned on the Mekka's starboard side and caused the fire to spread along the deck all the way aft.
Another death occurred aboard a third Odfjell ship later, the company said.
"Although there are various causes for these accidents, they all remind us that in addition to the general dangers attached to life at sea, we handle many hazardous cargoes," Storeng wrote in a newsletter to his employees in December. "We are going to do everything in our power to bring all possible risk factors under control."
He further announced that Odfjell's ship management department was taking over management of the ships previously managed by Ceres Hellenic.
"Ceres wanted to discontinue third-party ship management," Espen Bjelland, a vice president for Odfjell ASA, said in response to questions from his office in Ireland.
"At the same time, we wanted to take more control of ship management ourselves," he added. "Consequently we will take over all our Ceres-managed ships by the end of 2005."
In June, after the second explosion, Storeng also addressed his colleagues in a newsletter, saying that while the exact causes were not known, there was at least one similarity.
" In both cases tank cleaning operations were being performed," he said. "Immediate measures have been taken to prevent ignition in gas dangerous areas and to reduce (or) eliminate explosive atmospheres in tanks and on deck. We are also stressing that procedures and agreed measures shall be followed."
Some of the recommendations in the Coast Guard's report could, if approved, affect the international shipping community.
"Certainly, the lack of immersion suits in cold water contributed to the high loss of life," Crooks said. A requirement to carry immersion suits doesn't take effect until July 2006.
The suits provide up to seven hours of protection, Crooks said. Five ships and three aircraft were on the scene within two hours.
U.S.-flagged ships are already required to carry immersion suits, except for vessels that ply only Caribbean or other warm waters.
The International Convention for the Safety of Life at Sea has amended regulations to require all merchant ships to carry one suit per person on board.
Currently regulation requires at least three immersion suits for each lifeboat on a cargo ship, as well as thermal protective aids for people not provided with immersion suits.
With the adoption of the proposed amendments, immersion suits, just like life jackets, will become a personal life-saving appliance for everybody on board.
The Bow Mariner disaster occurred almost 21 years after another merchant ship sank at nearly the same location in the busy commercial shipping lanes off of Chincoteague.
The collier Marine Electric lost 31 seamen on Feb. 12, 1983, when it capsized and sank during a storm 30 miles at sea. Three crewmen survived.
Investigators determined that that ship had numerous problems, including hull cracks that had been patched with cement, worn hatch covers, and faulty maintenance.
Those kind of problems were not evident on the Bow Mariner, Coast Guard investigators have said.
"They were in compliance with all of their regulatory certificates," Crooks said shortly after the accident. "All of their inspections were up to date. There is nothing alarming about their history of deficiencies."
The only violation noted for the Bow Mariner came in 1996. It was a single "navigation underway" violation and brought a $3,000 fine, according to Coast Guard records.
"The tragic loss of lives in the Bow Mariner explosion was a strong reminder to all of us that although safety always comes first, things can go wrong and that we are evidently exposed to safety risks," Bjelland said.
Source:, By JACK DORSEY, The Virginian-Pilot, February 26, 2005

Illegal bypass
---THE master of the 16,320-ton Maltese-flagged, Greek-owned cargo vessel Katerina, which arrived at the Port of Long Beach in September last year equipped with pipes to bypass an important water pollution-control device, has pleaded guilty to a charge of obstruction of justice for advising other crew members to destroy and conceal from US Coast Guard inspectors incriminating telexes relating to the use of bypass pipes on the vessel.
The US Attorney for Southern California, Debra Yang, said, "This case is important for two reasons. The owner of the vessel knowingly allowed the ship to dump sewage and oil into the ocean, and then it tried to cover up its illegal conduct. After engaging in illegal conduct, no culpable party can try to hide its responsibility, not the captain nor the owner of the ship."
The operator of the vessel, DST Shipping, Inc of Thessaloniki, Greece, has agreed to plead guilty to obstruction of an official proceeding and failing to maintain an accurate Oil Record Book. In its plea agreement, DST acknowledged that "on numerous occasions" during an approximately six-month period in 2004 the vessel discharged oil-contaminated bilge water and oil sludge into the ocean. Furthermore, the shipping company acknowledged that it directed the vessel's crew to conceal the bypass pipe from US authorities. In the plea agreement, DST agreed to pay a $1million criminal fine.
Source: Maritime Advocate Online, Issue 193, February 22, 2005

IPOs prove booster rockets for dry market
---INITIAL public offerings are providing a welcome boost for dry bulk owners, as companies rush to invest huge amounts of capital to build their fleets.
But the tanker market has been left behind. There simply is not enough tonnage available for companies to make large-scale investments.
"Neither the tanker market nor the dry bulk sector are very firm," explains a London-based broker. "They have both been erratic recently, but IPOs are the main driving force behind the market at the moment. They are the reason there have been so many sales recently. Of 10-15 sales this week, seven or eight are due to IPOs."
Companies such as Dryship and Excel, which have issued IPOs recently, now have stacks of cash to invest and little choice but to turn to the dry bulk sector. This means prices are being pushed up, much to the delight of owners.
Dryships of Greece is a particularly good example. Having virtually doubled the size of its IPO to 13M shares from 7.1M, it can afford to splash out. Last week it bought four Panamax bulkers - Georgia T, Macanudo, Minoan Pride and Stefanos - from two different owners for a total of $97M.
But even this was not enough to sate its appetite: this week it switched to the larger end of the market with the purchase of the 2001-built 170,726dwt Cape Araxos for $75M, well over the average price of $67.5M for a Capesize bulker that's five years old. Dryships was also rumoured to have bought another Capesize, the 170,023dwt Bulk Australia, built in 2003, for $82M, but this reportedly fell through. HSBC Shipping Consultants say this does not matter, however.
"Whether these deals fell through or not is beside the point," the company declares in its latest report. "The reported prices remain benchmarks for the 'last done' deals, and on a rising market sellers will always look to get better."
This S&P activity obviously has a knock-on effect. "These IPO buy-ups are causing the rest of the dry market to be overinflated," a broker confirms to Fairplay.
"Take the 2001-built 76,000dwt Marina, for example. It was sold for $47.5M to an individual Greek buyer, which is a massive price. This is a direct result of the overinflated prices on other ships."
Compare the price for Marina to the sale of the 75,706dwt Seafarer II, built in 2002, which was sold in December for just $42M.
"But whether a Panamax bulker built in 2002-3 will top $50M in the near future remains to be seen," adds the broker. "Even though today's charter market is reasonable, it does not cover these kinds of prices."
Source: Fairplay International Shipping Weekly,, 24 Feb 2005

Tsakos Turns in Shipshape Year
---Oil and gas companies don't get to have all the fun when prices shoot up. Because oil and gas aren't worth too much unless they can be shipped from the wellhead to the customer, tanker companies have also seen boom times of late as demand has outstripped supply and pushed rates considerably higher.
Though not among the largest tanker operators, Greece-based Tsakos Energy Navigation (NYSE: TNP) is nevertheless a good pure play on oil shipping. As such, it was no great surprise to see the company post a very solid fourth quarter and full-year 2004.
Revenue in the December quarter climbed 49%, with charter rates for the company's vessels rising by more than 50%. While operating and overhead costs also climbed, the company more than doubled its net income for the quarter to almost $42 million.
Despite an aggressive construction plan under which five new vessels are to be added this year, the company posted free cash flow of roughly $61 million for 2004 as opposed to negative cash flow for 2003. Sharing some of that wealth, the company has hiked its dividend by 35%, and the stock now yields nearly 5%. Investors should note, though, that unlike most American companies, Tsakos pays its dividend on a semi-annual rather than quarterly basis.
Judging by the stock's low trailing price-to-earnings ratio (nearly 5) and lower forward estimates, it's clear that Wall Street believes that the oil shipping business has seen the peak of the cycle. To some extent, this is probably true. Shipping rates have already backed off of their late-2004 peaks because new tanker capacity is coming online.
The key to the equation, though, is global oil demand. Tanker rates have dropped in part because of slowing import growth into China and general economic malaise in markets like Japan and Germany. Should growth in any of these economies pick up, rates could quickly head up again because the current tanker demand-capacity balance is pretty delicate.
Given the strong moves already seen in the tanker space, Fools are probably better off looking elsewhere for ideas. While nobody can say for certain whether we have seen the peak in tanker shipping rates, the odds seem to be more in favor of yes than no, and owning a cyclical stock coming off of its peak can be painful.
Nevertheless, for those who just have to own a tanker stock, Tsakos does offer a good dividend, a young and improving fleet, and an operating philosophy that should leave them comparatively better off should rates drop further.
Source:, By Stephen D. Simpson, February 25, 2005

Goodbye Oslo
---Greek tanker owner Tsakos Energy Navigation (TEN) is to delist from the Oslo stock exchange.
It will maintain its New York listing, but said the cost of the Norwegian listing was unjustifiable, as too few shares were traded there.
Holders of stock registered through Oslo can sell it back to the company or transfer to the New York Stock Exchange.
The company also announced a final cash dividend of $0.95 per share for 2004.
The total payout for 2004 is now $1.65, compared to $1 in 2003 and $0.70 in 2002.
By mid-2007 TEN will operate 40 vessels of about 4.3m dwt.
Source:, published: 15:47 GMT, 23 February 2005 | last updated: 15:47 GMT, 23 February 2005

Attica buys Minoan stake as Sherwood stands on Greek doorstep
This splintering is, in fact, likely to go a step further with the long-anticipated entrance into the Greek market of Sea Containers, the John Sherwood-controlled Bermuda/London-based transport to containers group. Sea Containers and Greek owner Eugenides are close to concluding an agreeement to launch a jv to run a new fast ferry service from Piraeus to the West Cyclades islands of Serifos, Sifnos and Milos using an Incat-built Seacat catamaran now operating on the English Channel.
Sea Containers' Sherwood has been seeking an opportunity to enter the liberalised Greek ferry market. In March 2001 Sea Containers secured a 30-year concession to operate the Corinth Canal and later that year Minoan Lines was forced to deny it was in the process of selling a strategic stake to Sherwood. In the autumn of 2003 Sherwood representatives were running the rule over the then-HFD reportedly interested in purchasing Minoan's 31.6% stake, but again Minoan said it would not sell. Sherwood was reportedly back last summer again trying to woo HFD. In the meantime, Sea Containers had linked with Italian operator SNAV and the two are now running Seacats across the Adriatic Sea between Italy and Croatia.
A Sea Containers/Eugenides jv is a natural one. Sea Containers wants to enter the Greek market and has ships available as it looks to ease pressure it is facing from Eurotunnel in its Dover-Calaisservice. Eugenides interests have an extensive luxury waterfront hotel development in Sifnos, the family's home island. At one stage Eugenides was understood to be looking at a helicopter link between Athens and Sifnos.
Attica's chairman Pericles Panagopulos was a senior executive with the Eugenides-owned cruise company Home Lines prior to creating Royal Cruise Line in 1971, which he sold to Norwegian interests in 1989 and subsequently established Attica Enterprises and set about building the Superfast fleet.
Source:, 25 Feb 2005