Greek Shipping News Cuts
Week 45 - 2005


Greek-owned shipping fleet flies flags of 45 countries

---Accounts for 25 pct of global maritime trade; shipowners ask for incentives
The global Greek fleet consists of 502 tankers, 418 carriers of chemicals and oil by-products, 61 oil and gas carriers, 1384 bulk cargo and iron ore carriers, 176 container ships, 577 general cargo carriers, 139 passenger ships, 27 combined cargo ships and 54 ships of other types. The number includes 338 new ships totaling 15.84 million gross tons, 200 of which are tankers.
Greek shipowners have been especially active in recent years in investing in new ships. Despite the fact that they have considerably renewed their fleets, their orders for newbuildings account for 7.8 percent of total orders, with deadweight capacity accounting for 12.2 percent of total.
The Greek-owned fleet flies the flags of 45 countries, most of them flags of convenience that allow shipowners to avoid heavy taxation and to cut payroll costs by employing foreign crews at low wages. The most important countries under which the ships are registered are Greece (29 percent), Panama (17 percent), Malta (16 percent), Cyprus (12 percent), Bahamas (7 percent) and Liberia (6 percent).
There were 969 ships in the Greek shipping register at the end of the first quarter, up from 904 in 2004. Another 171 ships under construction are expected to join soon.
According to Bank of Greece data, capital inflows from maritime activities reached 17 billion euros in 2004, up 40.6 percent from 2003.
IPOs of shipping firms appear to be abating
LONDON (Reuters) - A run of public share offerings in the shipping industry is now set to abate with firms looking at mergers instead, financiers involved in the deals said yesterday.
Fotis Giannakoulis, assistant vice president of US-based Fortis Securities, said $3.5 billion had been raised by 18 IPOs on US stock exchanges alone in the last 15 months.
Giannakoulis said the unprecedented bid for capital in such a short space of time was spurred by surging global seaborne trade and high freight prices as shipowners tried to cash in on the nearly three-year boom.
Share flotations in shipping were rarely heard of before the spree, which was largely made up of Greek concerns.
Giannakoulis said the funds raised were enough to finance 315 new 75,000-ton panamax cargo ships for dry commodities trade.
He said most of the IPOs were in the dry commodities sector ($1.3 billion), followed by container and oil trade worth $900 million each. Gas and other freight were much smaller.
Peter Shaerf, managing director of US-based AMA Capital Partners, said the total market capitalization for US oil tanker firms had grown from $2.5 billion in 2001 to $20 billion.
However, firm but lower freight rates this year, compared with the record-breaking peaks seen at the close of 2004, are pushing shipping firms to switch to mergers as a route to growing, financiers said.
Robert Lustrin a partner with US-based law firm Seward and Kissel also said more firms would choose mergers as a force for growth.
Source: By Nikos Bardounias - Kathimerini, 10 Nov 2005

Club taking hard line on Greek fleets
---The West of England club is set to turn away some old pals.
A once-close relationship between a number of Greek shipowners and the West of England protection-and-indemnity (P&I) club is ending in acrimony.
The West of England is refusing to renew a significant number of Greek accounts amid growing controversy, even though some of the relationships stretch back more than 25 years.
Owners on the move include Fairdeal, Tsangaris Bros, Vamvaship and Hellenic Seaways, with market sources suggesting that the club is set to deny more Greek owners renewal terms.
The West of England is among the most Greek-orientated of the P&I clubs but appears to have suffered a serious breakdown in its ties with a batch of members.
A refusal to offer renewal terms is often seen as an indictment of the casualty record or age of a fleet but has the benefit from the shipowner's standpoint of freeing his premium rating from the restrictions on price competition operated by the International Group P&I cartel.
In the case of Fairdeal, there has been tension over a number of claims exacerbated by a perceived lack of support from the club over a $1.5m US court penalty imposed as a result of pollution offences involving the 45,000-dwt products tanker Fair Voyager (built 1985).
Oily-water separator and oil record-book offences are the source of growing antagonism between shipowners and the clubs as the high costs of incidents have led to the mutuals becoming harsher in their treatment of such discretionary claims.
Fairdeal has a 15-strong fleet, with the oldest ship, the 141,000-dwt single-hull tanker Thea (built 1974), used as a floating, storage and offloading (FSO) unit off Fujairah. There are further elderly vessels but also two newbuildings on order and options for another four.
The Tsangaris case is complicated by a family decision to split its panamax-bulker interests but market sources suggest there has been tension over claims. ( For more on Tsangaris, see story right page [ 4 in Tradewinds Weekly] )
Vamvakaris family-controlled Vamvaship operates elderly handysize bulkers and the fact that some of the vessels date back to the 1970s could be an issue.
Hellenic Seaways is one of the larger Greek ferry groups, with a fleet of some 35 vessels, but it is a successor to Hellas Flying Dolphins and Minoan Flying Dolphins, the owner of the 4,600-gt ferry Express Samina (built 1966), which sank off the island of Paros in 2000 with the loss of 80 lives.
Although the tragedy was five years ago, allegations about the way the ship and company operated have recently been aired in court in a prosecution of the master, senior officers and company executives.
Although there are always a few fleets that are not offered renewal terms, the West of England appears to be taking a relatively harsh line ahead of the February 2006 renewals, possibly driven by the $11m loss it incurred last year that cut free reserves to $134m.
Source:, By Jim Mulrenan, London, published: 11 November 2005

Sale-and-Purchase squalls ahead?
---The North of England P&I Club has warned Greek shipowners they face an increase in sale-and-purchase disputes as second-hand ship values fall and the industry embarks on a buying spree.
The warning was given at a seminar in Piraeus on November 9, which the club organized in conjunction with sale-and-purchase experts from shipping law firms Ince & Co and Mills & Co.
According to North of England's Greek office manager Tony Allen: "Many commentators expect freight markets to fall next year and this is likely to see second-hand tonnage prices dropping from their current high levels, which in turn will increase the potential for disputes with sale-and-purchase contracts. This is particularly true in Greece, where there is a huge amount of liquidity at the moment and many shipowners are waiting for second-prices to fall before they reinvest in ships.'"
North of England director Mike Salthouse says the club has experienced relatively few sale- and-purchase disputes over the past three years. "Buyers' strong desire to acquire ships means they have been reluctant to take issue with conventional areas that give rise to disputes because they know if they are too aggressive the seller may withdraw the ship from sale. However, next year we expect the commercial balance between buyers and sellers to become much more equal. This, coupled with the fact that rapid changes in ship values have historically seen an increase in the number ship sales which collapse, will inevitably increase the number of disputes."'
Yesterday's seminar at the Piraeus Yacht Club was one of a series North of England is holding for its members, brokers, managers and underwriters around the world on sale-and-purchase disputes and how to avoid them. A similar event was held in London in September 2005 and further events are planned in Hamburg, Singapore and Hong Kong.
The seminar addressed buyers' remedies for misrepresentation in the context of the widely used Norwegian Saleform 1993, and breaches of the U.K. Sales of Goods Act. It also covered some of the more well-publicized potential areas of dispute, such as the issue of when vessels are ready for delivery under the Norwegian Saleform and the sorts of claims buyers may be able to pursue against a seller in relation to the condition of the vessel on delivery.
The effect of third-party contracts such as charterparties on the sale and, conversely, the impact of the sale on those contracts was also considered. Overall the seminar was geared towards emphasizing the loss-prevention steps which buyers and sellers of second-hand tonnage can take to protect their positions and avoid disputes.
Source: November 10, 2005,

HCS calls on Port Authority to take lead in Perama rivival
---Greece's Hellenic Chamber of Shipping is challenging the Piraeus Port Authority to take the lead in reviving the country's floundering shiprepair industry. In presenting a series of proposals, the HCS maintains the PPA has a central role to play if the shiprepair industry is "to get out of the dead-end" in which it now finds itself.
In a letter to Marine minister Manolis Kefaloyiannis, signed by chamber president, George Gratsos, the HCS contends the Perama repair zone "must not be seen as a competitor" to Hellenic and Elefsis shipyards, but rather "as complementing them". The HCS says: "Perama has the know-how, but the legal framework, no matter how often rejigged, has never offered a real healing of the cause of Perama's problems."
The HCS says the root of Perama's problems stem from poor organisation, infrastructure, installations and cost. The PPA controls the land on which much of the zone is located and the installations, and the HCS says it can help "in a big part" towards providing a sense of security which will lead to an increase in revenue for repair companies and greater employment.
The HCS makes four main proposals, two of them quite radical in the Greek context for they call for co-operation between workshops. The first calls for the creation of a company composed of "the multi-collection of workshops in the area", and the second, the creation of industrial areas in which workshops that do not meet the licencing criteria set by the ministry of Development, but which do have vast experience and know-how.
In the first case the 'company' would lease the quay areas from the PPA and operate and maintain them. It is foreseen that no workshop would have more than a 5% stake in the holding company, which will be responsible for the upkeep of the area, controlling the flow of repair work, ensuring shipoperators do not use the repair facilities "as a lay-up area" and generally acting as a co-ordinator between the repairers and the administration.
The new industrial areas would be linked to the repair zone and be populated after gathering the smaller workshops together which would make them more efficient, safer and provide greater legal protection for them and for the client.
The other two proposals primarily focus on upgrading the repair zone.
The chamber proposes the Kynossoura area be developed and become part of the Perama base. The building of a floating quayside is suggested as a way of satisfying the archaeologists, with this quay being linked to Perama on a 24-hour basis by open-type ferries.
Improving the power supply to the area generally to meet industrial requirements is a must, says the chamber. The HCS advocates a natural gas installation to provide power. It notes gas is environmentally friendly, the installation is compact and that up to 75% of the financing of the installation could come from the European Union. Further, the installation can be used to produce hot water or steam, and this alternative is fully financed by the EU.
Meanwhile, the Industrial Chamber of Piraeus is keen to expand the Industrial Park of Schisto SA, which borders on Perama to the west. Though the area is in the proximity of a naval base, Chamber president, Evangelos Tsitouras and general secretary, Andrianos Michalaros, report that during a recent visit to the office of deputy Defence minister, Vassilis Mihaloliakos, the minister expressed an interest in developing the industrial park into a major maritime service centre for vessels trading in the Mediterranean.
Source: 11 November 2005 Vol. 6 / No. 42

Sarlis takes Piraeus battle to court
The plaintiffs are Sarlis Container Services, a ship manager and liner operator in the Mediterranean, and Dealmar Shipping, a forwarder, shipping agent and feeder operator, through its subsidiary Blue Container Line.
But before any anticipated ruling of the competition panel in its favour, Sarlis filed for bankruptcy a week ago.
It said the unfriendly attitude of the port towards customers of its size was to blame for its collapse after 54 years of operation.
In particular, Sarlis claimed that the first-come/first-served principle has long ceased applying at the Piraeus container terminal, after an agreement between the port and Mediterranean Shipping Co.
This accord reduced handling charges and gave service priority, against a guaranteed volume of box traffic. MSC is by far the biggest user of Piraeus, responsible for more than half of its container traffic, mainly in transit.
The agreement involves penalties for delay, so the terminal allocates most of its energy and handling resources to serving the MSC ships, to the detriment of smaller users, who are delayed and incur higher handling charges.
The Hellenic Chamber of Shipping has endorsed the Sarlis complaint through a letter to the shipping minister (the government is the majority shareholder) of the port. The chamber has urged that equal treatment of port users be restored at the terminal.
The dispute was heightened in September, when the port called Sarlis and Dealmar to settle outstanding warehousing charge, threatening a service ban.
The companies refused to pay, alleging that the charges were unfairly inflated by the port and that delays result from the deal with MSC deal and from shortcomings in box management.
Source: Newswatch, Fairplay International Shipping Weekly, 10 Nov 2005

Consilium Marine Group of Sweden anchors in Piraeus
---Consilium Marine Group of Sweden, has since July first 2005 their latest foreign office in Piraeus Greece: Consilium Marine Hellas Ltd in full operation.
The new office, located on starboard side of the entrance of the Port of Piraeus, will be a full performance office, staffed with at date 12 staff for all duties needed for Consilium's line of business; Qualified Service Engineers, Spare Parts inventory stock, Technical Consultance and Statutory Interpretation, Sales Office and other support whatever our customers may demand and for the full range of Consilium Marine Group's products (Fire and Gas Detection, Speed Logs, VDR, Radar and IBS). In order to organise all this, a sufficant number of administrative staff is employed as well.
Our paramount ambition with this new venture, is to provide the vast Greek and adjacent shipping communities a gateway to the worldwide Consilium Corporate support network and the services available within.
This new office will be managed by Mr. Sven Lansberg, expatriated from Consilium Marine Gothenburg Sweden and Mr. Spiros Maniatis, owner of former representative CRS Electronics.
Contact: Sven Lansberg, General Manager, Consilium Marine Hellas Ltd, 19, Zoodochou Pigis Str, Piraeus 185 38, Greece, Ph: +30 210 428-7097/8, Fx: +30 210 428-7165, Mob:+30 697 493-9324
Sven Lansberg is a member of the "Scandinavian Shipping and Business Association in Greece".
Source: email message, 7 Nov 2005

Greek Metrostar Management Orders Six Bulk Carriers Worth 221.7 Mln Euro
---Greek ship operator Metrostar Management, controlled by local Angelopoulos group, is said to have signed contracts for the purchase of six bulk carriers, costing a total of $260 mln (221.7 mln euro), it was reported on November 8, 2005.
The vessels will be built by Japanese ship-building yards Imabari Shipbuilding and Tsuneishi.
Five of the ships, of 82,000-dwt capacity each, are due for delivery in 2007. The sixth ship, a capesize bulk carrier with a capacity of 180,000 dwt, will be delivered in early 2008.
[Editor's note: Greek shipowners bought ships for some $300 mln (255.8 mln euro) from November 8 to 13, 2004, the Greek News Digest reported on November 18, 2004.
The most important investment was that of Angelopoulos group, which bought Ultra Large Crude Carrier (ULCC) for $122.5 mln (104.4 mln euro). Also, Diana Shipping bought a capesize bulk carrier, constructed in 1999, for $63 mln (53.7 mln euro).]
Source: 8 November 2005, Greek News Digest

Excel to avoid capital markets in dry bulk consolidation.
---Amex switch benefits Greek company, writes Rajesh Joshi, 7 November 2005, Lloyd's List
Excel Maritime itself has not remained immune from the changing climate. Its share price is now $15 compared with the $21 at which its second follow-on in March was consummated.
The slump in shipping share prices was entirely a function of the freight rate environment, he maintained.
The preferred approach for now, said Mr Georgakis, would be to add one to three ships at a time, most probably by utilising debt financing, instead of blanket acquisitions of fleets or companies.
However, he did not rule out such opportunities entirely.
Excel Maritime shifted into overdrive a year ago when the company filed a $200m shelf registration with US regulators to fund fleet expansion. The two equity offerings aggregating $179m gross enabled the company to alter its fleet profile substantially.
It also reduced the average age of its fleet to 13.2 years, below the reported industry average of 16 years.
He said the handies were typically fixed for a year and the panamaxes for two. According to a company statement the mix between charter and spot fleet days stands at 28% and 72% for next year.
Mr Georgakis insisted that the handy bulk trades were poised for a rebound due to superior prospects in China. The robustness is already reflected in forecasts for next year, he insisted.
A slowdown in Chinese gross domestic product did not necessarily translate into less electricity or steel because of Chinese needs for the 2008 Olympics, the 2010 World Expo and other projects such as the electricity grid and highways.
However, he stressed that Excel Maritime understood the value of this investment in the context of being a New York-listed firm.
He cited several advantages of a New York listing, including improved positioning among the investment community, certainty of the fill rate, improved share liquidity, reliable pricing and reduced volatility and exposure to a wider investor base.
Excel had no plans to expand beyond its dry bulk niche, Mr Georgakis said.

China Shipping Group Favors Greek Island
---The state-owned China Shipping Group may launch a project to develop a transshipment container terminal on the Greek island of Crete, the Merchant Marine Ministry said Friday.
The company's president, Li Kelin, wrote to Greek Merchant Marine Minister Manolis Kefalogiannis earlier this week stating that after visits to a number of European locations, "Crete was the highlight."
"The geographical location of Crete makes it an ideal choice to develop a transshipment center for the East Mediterranean, the Black Sea and the Adriatic Sea," Li added.
Li said the port of Timbaki on Crete's south coast "with all its features is a good site for transshipment terminals."
The shipping group is one of the world's largest and its intention to set up a transshipment center in the Mediterranean was a reflection of China's growing exports to Europe.
In his letter, Li said that establishing China Shipping's own transshipment hub in the Mediterranean was firmly on the company's agenda given the rapid growth of the company's container volume on its Far East-Mediterranean services.
The company has carried between 800,000 and 1 million containers to the Mediterranean so far this year.
China Shipping operates a total fleet of 400 vessels with an aggregate deadweight of 11.5 million metric tons (12.68 million tons). The company's container unit, China Shipping Containers Co. Ltd., has more than 100 vessels with a total shipping capacity of nearly 200,000 twenty-foot equivalent units, or TEUs. One TEU unit is equal to around 40.9 cubic meters. [Associated Press]
Source:, 11.11.2005, 04:44 AM

Gas pipeline will turn Greece into major gas transit hub
---Greek-Italian project to be completed by end-2009, carry 8 billion cubic meters.
Italy and Greece will sign today an agreement for the construction of a 300-million-euro pipeline that will carry natural gas from the Caspian Sea and Iran to Western Europe when it is completed, at the end of 2009.
The 212-kilometer (130-mile) mostly underwater pipeline will be built by Poseidon, a company due to be set up by Greece's Public Gas Corporation (DEPA) and Italy's Edison, with each owning a 50 percent stake in Poseidon.
The pipeline, running from the Greek port of Stavrolimenas, near the town of Igoumenitsa, in northwest Greece, to Otranto in southeast Italy, will have a diameter of 32 inches and a capacity of 8 billion cubic meters (282 billion cubic feet) of natural gas per year. Initially, however, it will only operate at about 25 percent capacity.
In order for Caspian gas to reach Italy, two other projects must be completed: a pipeline from western Turkey to the Greek town of Komotini, and a 300-kilometer link connecting Greece's backbone gas pipeline network with Stavrolimenas. The latter is being built at DEPA's expense and will cost 600 million euros.
The agreement for the Greece-Italy pipeline will be signed in the Italian town of Lecce by Development Minister Dimitris Sioufas and Italian Minister for Productive Activity Claudio Scajola. Turkey's Minister of Energy and Natural Resources Hilmi Guler will also attend the ceremony.
The Greek delegation will also include Deputy Development Minister Giorgos Salagoudis, DEPA Chairman Raphael Moysis and high-ranking officials from the Development and Foreign Affairs ministries.
The construction of these pipelines will turn Greece into a transit hub for natural gas to Western Europe. Initially, the natural gas will come from the Caspian Sea, via Azerbaijan and Turkey. Eventually, gas from Iran and Turkmenistan, and also from Siberia, via Russia and Turkey, will also run through the pipeline.
The project is one of the European Union's five Trans-European Energy Networks, which are considered priority projects.
Italian financial paper Il Sole 24 Ore wrote yesterday that the pipeline will be especially important as natural gas deposits in the North Sea are declining, adding that the World Bank has approved aid of 21 billion euros for the modernization of the gas transport network in Greece, Turkey and other Balkan countries.
Source: Kathimerini Greece,