Greek Shipping News Cuts
Week 42 - 2007


Event Review - Greek Ship Finance Forum, 18 October 2007

Still the logic is frighteningly circular in some ways. Scott Burk of Bear Stearns argues that the five-year charters on the two modern capesize vessels acquired by Diana for $275 million will pay the vessels down to a residual ship value of $36 million per ship in 2013, making the average per vessel price of $137.5 million attractive. Others, meanwhile, espouse the logic that a new vessel is always worth more than a used vessel and so order newbuildings. But what will the new vessels really be worth when they are delivered in 2010 or 2011 without the benefit of the current market?
Credit Crunch
Greek banks, which for the most part had not reaped the fees won by arrangers of major global syndications, are by and large more traditional in their business models and thus not dangerously exposed to the general derivative and credit market liquidity problems that have arisen. In contrast to banks such as Northern Rock that had used the abundantly stocked wholesale markets to fund their growth, many of the Greek banks relied on their traditional funding source of Euro deposits that by and large have not yet been impacted. They have to pay more for funds in the Interbank loan markets, but not to a crippling extent and the majority of which will ultimately be passed on to consumers.
Rather than threatening these institutions, which of course are by no means limited to Greece, the credit crunch has presented them with an opportunity to ultimately do some minor risk repricing. In addition it temporarily removes the major syndicators, with their enormous balance sheets and pre-July ability to undercut competitors, from the market, providing more traditional banks some relief from the tremendous pressure on pricing and terms. Meanwhile buyers of syndicated debt are finally being given a chance to push back and get some say in what terms and pricing they will accept.
We look forward to covering the Greek ship finance market in more detail and sincerely thanks all those who assisted in this research. In the meantime we turn to a review of our ninth annual Greek Ship Finance forum.
9th Annual Greek Ship Finance Forum
Time for Enlightenment
Back to Business
After hearing from ship owners and some rigorous analysis, conference attendees had the opportunity to hear from some financiers. Marios Koliopoulos and Laurent Magloire told the audience that after 20 years of absence Bank of America was returning to cover Greek Shipping. They discussed their proprietary residual value guarantee product offering with which they have already grown their residual value exposure to marine assets to $250 million.
Dimitris Gialouris of Marfin Egnatia Bank gave his views on the credit crisis, suggesting that it will result in an increased cost of funding and banks being more selective about deals as well as counterparties. He also discussed the importance of local banks to change their focus from plain vanilla mortgage price competition to service differentiation and encouraged them to lend to expand their geographic base to include the shipping community outside of Greece.
Niklas Nilsson of Nordea Bank London further examined the credit crisis, noting that $20 billion in losses have been suffered so far while analysts expect $100-$200 billion losses in total before the crisis is over. He expects ultimately that banks will charge higher margins to compensate, long tenors will be penalized, and bilateral and club deals will dominate the market with syndicated deals facing the greatest challenges. Mr. Nilsson also anticipates existing clients will be favored, structures and covenants will be tightened, and that deals will be done on a best-efforts basis rather than fully underwritten, with market flex and price flex language. Still, deals will be done and credit will be available, particular to strong credits and good customers.
TEN's Birthday Celebration
Safety, Capital & Liquidity
Source:, Freshly Minted, 18 October 2007

Market buzzes as Quintana looks at "strategic alternatives"
---US-listed bulk ship owner Quintana Maritime is to seek "strategic alternatives" according to chairman Corbin Robertson. In an announcement, Robertson said: "The board, in light of the significant increases in asset values experienced in the dry-bulk shipping industry during the past year, has concluded it is appropriate at this time to explore ways to enhance the company's value for its shareholders."
The announcement did not specify the alternatives being considered, but Citigroup and Dahlman Rose have been given the task to advise, leaving analysts and brokers to speculate Quintana may be ready to take advantage of the market, by putting itself up for sale, a view shared by Cantor Fitzgerald analyst, Natasha Boyden.
She says company board members would be more likely to want to sell the company at a premium over its stock price rather than sell-off ships.
The Piraeus rumour mill began to churn when Marine Money's man in Greece, Kevin Oates, opened the Greek Finance Forum, October 18, by apologising for the absence from the first panel of Quintana's president and ceo Stamatis Molaris and US-listed Navios Maritime Holdings' cfo George Achniotis, because "of recent developments in the marketplace". Oates promised panel moderator David Frischkorn, vice chairman corporate finance at Dahlman Rose, would have more to say on the subject. He did not. Nor did Dahlman Rose's Simon Rose, who was also in town.
The Angeliki Frangou-led Navios has of course bought fleets in the past, but not on the scale of investment that would be required this time. Indeed, the company came into being when Frangou's blank-cheque acquisition vehicle International Shipping Enterprises (ISE) acquired the US-based logistics and bulk carrier company Navios Maritime for $607m in the second half of 2005.
The Glyfada-based Quintana runs 29 modern ships, 22 owned and another seven panamaxes on bareboat charter. A number of the ships are on longterm t/cs at rates considerably below those currently being obtained. Eight capesize ships are on order, seven of which are owned through jvs involving Quintana, Robertson and coal man Hans Mede, which gives the company a very high value, perhaps too high for the shipping sector.
Quintana's Molaris has been in a similar position before, when he was cfo at Stelmar Tankers, during that company's rapid development and subsequent highly profitable sale to OSG.
Should Quintana be sold, Molaris could end up with well over $20m as restricted stock grants to executives will come in the event of a sale and will make Molaris a 1.1% shareholder.
Robertson held a 9.1% stake at last proxy filing and Mende then had 4.3% of shares.
Source:, 19 October 2007 Vol. 8 / No. 39

GO board taking Tartsinis to task
---Money transfers made by GO's boss have come under close scrutiny.
The chief executive of London-listed Global Oceanic Carriers (GO Carriers) is under investigation by the company's board and financial advisors over allegations he improperly transferred money from the public company to a private bank account.
Michael Tartsinis made unauthorised use of the bank account of a former business partner on at least two occasions, according to allegations in documents reviewed by TradeWinds. The dollar amount of the transfers could not be determined.
"I don't know what you're talking about," said Tartsinis before declining to field further questions in a brief interview as TradeWinds went to press.
The transfers are at the centre of an inquiry by the company's independent directors, aided by its financial advisor, Jefferies, sources tell TradeWinds. The board has retained forensic accountants, the sources says. One director who is also a member of GO's audit committee submitted his resignation earlier this month without publicly stating a reason. GO Carriers is listed on the Alternative Investment Market (AIM).
"We have grave concern about the potential financial, civil and criminal liability you may have exposed our client, its shareholders and directors to," states a lawyer from the complaining company, Custodian Shipping Ltd, in a 12 September letter to Tartsinis.
The Custodian letter also references payments made from the account to Ultra Shipping Ltd, understood to be a company privately owned by Tartsinis.
Tartsinis states through an attorney in a 13 September response that he mistakenly believed he had retained ownership of Custodian when he and former business partner Nicolas Pappadakis divided their companies last spring. Through counsel, Tartsinis portrays the transfers as innocent but acknowledges "the company [Custodian]probably should not have been used for these two transactions".
Pappadakis is well known in the industry through his chairmanship of Intercargo but is also no stranger to GO Carriers. He served as the company's non-executive chairman prior to his resignation in May.
Tartsinis explains further that "neither Global Oceanic Chartering Ltd nor its parent provide this type of service". The error was discovered "immediately" and the money transferred from GO Chartering to Custodian, the letter indicates.
In a separate instance in August, the Custodian account "was used to supply an agency service tied into a charter".
Payments were made to third parties including GO Chartering, which received "a brokerage fee" at "normal industry rates".
Custodian's legal counsel makes clear in a 19 September letter that the company is not satisfied with Tartsinis's explanation. It calls the reply "unresponsive" to demands in the earlier complaint, which included a letter indemnifying Custodian from all liabilities and a bank guarantee covering future liability "due to your unauthorised activity".
The board resignation announced on 4 October by GO Carriers came from Theo Phanos, co-founder of Trafalgar asset managers and once a major shareholder in GO Carriers. No reason was stated. Attempts to reach Phanos at his London office were unsuccessful.
Underwriter Jefferies took GO Carriers public on London's AIM exchange in May 2005.
Whereas on US listings an underwriter's due-diligence responsibilities cease with completion of the IPO, the financial sponsor retains oversight duties on the AIM for the life of the company. In effect, it takes the place of a regulatory body like the Securities&Exchange Commission (SEC) in the US. These "nominated advisers" are sometimes known by the shorthand "nomads".
Nick Davies, Jefferies's senior shipping man in London, declines comment on the GO Carriers matter.
GO Carriers operates a fleet of six bulkers with a seventh scheduled for delivery this month. The company has cited further growth ambitions and hinted at a public listing in the US.
By Joe Brady, Stamford, published: 19 October 2007

Oceanaut, Inc. enter into definitive agreements for purchase of nine vessels
Upon delivery of the vessels, the fleet will be comprised of two Capesize, four Panamax and three Supramax dry bulk carriers. These dry bulk carriers transport a variety of dry bulk cargoes such as coal, iron ore and grain. The vessels have a combined cargo-carrying capacity of 809,000 deadweight tons and an average fleet age of approximately seven years upon delivery of all newbuilding vessels. The two Supramax dry bulk carriers are scheduled for delivery in 2008 and the third Supramax dry bulk carrier, together with the two Capesize dry bulk carriers, are scheduled for delivery in 2009.
Oceanaut will also file a Current Report on Form 8-K disclosing further details on the fleet acquisition and investment and attaching copies of the definitive agreements.
About Oceanaut, Inc.
Oceanaut, Inc. (AMEX: OKN; OKN.U; OKN.WS) is a blank check company formed for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition, stock purchase or other similar business combination, vessels or one or more operating businesses in the shipping industry.
ctober 17, 2007 08:08 AM Eastern Daylight Time
Source: Press Release,

Globus Maritime Announces a New 2-Year Time Charter Agreement for Panamax Vessel
About Globus Maritime Limited
Globus is listed on the AIM of the London Stock Exchange under ticker GLBS. Jefferies International Limited is acting as nominated adviser and broker to the Company.

New York broker Compass Maritime remarks on the tendency of tanker prices to remain strong even when freight rates weaken.
Equity offering linked with S&P
There is a relationship between the recent bout of secondary equity offerings and a new round of vessel purchases.
Drytank, the private company, is linked with the purchase of the 1995, Taiwanese-built 149,000dwt Tiger Lily at $90M.
The newer vessel is tied into a lengthy period charter with three years to go, at $55,000 a day.
A three-year new charter on a modern Cape today is worth about $70,000-80,000 per day, which suggests a charter-free value north of $150M for the Daewoo vessel.
Ship values, with implicit inferences to vessel earning power, are linked with stock prices, with equity analysts opining on shipping stocks carefully monitoring sale and purchase transactions.
Jefferies bumps up targets
Consider that Jefferies & Co bumped up targets on DryShips to $108 per share after the Capesize acquisition announcement. DryShips easily blew through this target on its way to $120 per share, which was more than double its price at the end of May 2007.
This is one of the strongest-performing NASDAQ stocks, suddenly sporting a market capitalisation of $4.3Bn, which is twice that of Overseas Shipping and equal to that of Teekay if you use figures preceeding its upcoming conventional tanker spin-off.
Another listed company, Paragon, is believed responsible for two very strong purchases, $89M each for two 74,000dwt Panamaxes built in 2006 at Hudong.
They are Iolcos Destiny and Anny Petrakis, both with charters attached.
Greek buyers scoop Panamaxes
In the Handy sizes, a Danish purchaser paid $62M en bloc for Mount Cook, built in 1996, and Amazonia (1994); they are both Japanese-constructed, 28,000dwt ships with 30-tonne cranes.
Two single-hulled, 100,000dwt Aframaxes built in 1990 at Onomichi were also reported sold for conversion, fetching $28M each.
Source: Fairplay International Shipping Weekly, Sale And Purchase, 18 Oct 2007

Aegean Marine Petroleum Launches New Lubricant Service
---Company to Complement Existing Marine Fuel Services with Exclusive Line of Own-Brand Lubricants; New Service to be Available Worldwide
October 17, 2007: 08:30 AM EST
PIRAEUS, Greece, Oct. 17 /PRNewswire-FirstCall/ -- Aegean Marine Petroleum Network Inc. , an international marine fuel logistics company that markets and physically supplies refined marine fuel and lubricants to ships in port and at sea, today announced that it has launched Alfa Marine Lubricants, the Company's own-brand line of lubricants that it intends to market and distribute globally.
The Alfa line of lubricants uses only non-recycled, mineral-based oils and meets stringent engine manufacturer specifications that exceed the requirements of many original engine manufacturers (OEMs). As a manager of the marine fuel supply chain from procurement to delivery, Aegean is positioned to become the first fully independent supplier of marine lubricants, a market traditionally led by major oil companies. Currently, Alfa Marine Lubricants are available in Aegean service centers based in Greece and Singapore, two major global ports. Management plans to roll out the branded lubricants throughout the Company's network of service centers worldwide and to further expand distribution of the brand to the top 20 bunkering ports worldwide.
E. Nikolas Tavlarios, President, commented, "Our new lubricant service is a natural extension for Aegean. Consistent with the company's strategy to physically supply marine fuel, our high-quality, branded line of lubricants will provide added value to our customers and further enhance Aegean's leading reputation as a full-service logistics company. Through our well-funded growth plan, we continue to take advantage of the large number of seaborne vessels currently under construction for the world fleet and are positioning ourselves to capitalize on our role as the first independent global retailer of lubricants."
Mr. Tavlarios added, "We plan to grow in the 600-million-gallon annual world ship lubricant business by leveraging Aegean's market and technical expertise as well as the Company's strong customer relationships throughout our expanding global service center network. By seamlessly integrating our new lubricant service into our existing operating platform, management will remain committed to providing innovative solutions for customers and driving shareholder value."
About Aegean Marine Petroleum Network Inc.
Aegean Marine Petroleum Network Inc. is an international marine fuel logistics company that markets and physically supplies refined marine fuel and lubricants to ships in port and at sea. As a physical supplier, the Company purchases marine fuel from refineries, major oil producers and other sources. Through its service centers in Greece, Gibraltar, Singapore, Jamaica, the United Arab Emirates, West Africa and Northern Europe, the Company sells and delivers these fuels to a diverse group of ocean-going and coastal ship operators and marine fuel traders, brokers and other users.
Source: PR Newswire

Aegean Marine Petroleum On The Move
---"The price of chartering boats to ship iron ore and coal across the ocean has actually tripled, and Aegean is expanding with its purchase of Bunkers at Sea".
By now you probably know something about the reasons that dry-bulk rates have risen, as well as the tremendous moves in leading ship charter firms like Genco Shipping & Trading (GNK), DryShips (DRYS), Diana Shipping (DSX) and Excel Maritime (EXM), all of which I have recommended for two years, along with newcomer Paragon Shipping (PRGN). These are all companies that started off the year with low valuations due to a perception that they were up-and-down cyclical stocks, and they have all advanced rapidly along with charter rates because their low-expense business structures allow most of the windfall revenue to go virtually straight to the bottom line.
Back in early June and last month, I updated you on one of my favorite side plays on this trend, which is marine fuel and lubricants provider Aegean Marine Petroleum Network (ANW), after it announced that it would launch a new service station in West Africa. But now I want to tell you about its latest move, which is the purchase of a Belgian-based ocean fueling concern called Bunkers at Sea.
In some ways I wish that the news had not pushed ANW shares up so far so fast, because in my experience parabolic advances typically lead to parabolic declines. But you need to know that the ascent happened because there is just a lot of power in ANW's very straightforward business plan: To become the dominant provider of marine fuel worldwide at a time when the market is very strong, highly fractured and undergoing a fundamental structural change that plays to its strengths.
To get a little more color on the Bunkers at Sea deal and where it fits in that plan, earlier this week I talked to company president E. Nikolas Tavlarios. He's pretty cool -- young, personable, knowledgeable, no hype. He formerly worked for oil tanker company General Maritime (GMR), so he really knows the fuel logistics business from the inside out.
Financial competence and shareholder friendliness show up in the way that companies pay for their deals. I was impressed that Tavlarios financed the Bunkers at Sea deal entirely within ANW's current cash-flow structure. He didn't issue new shares that diluted current holders, or take on any long-term debt. He declined to comment on specifics for competitive purposes.
So, why did he do the deal? Tavlarios explained that Bunkers at Sea is a niche provider in northern Europe -- primarily the Rotterdam area -- that's been in operation for ten years. He said that it's "very credible" and "fit beautifully" into the ANW culture with a great reputation for high-quality service. It had a lot of customers that are already ANW customers elsewhere in the world, and others that could become customers in the ANW "network" in the future. So there's definitely some synergy already here between the two companies.
But Bunkers at Sea has a different angle of attack on the marine fueling biz than ANW. Rather than fuel up its customers at port, Bunkers at Sea literally fuels them on the open ocean. The benefits, according to Tavlarios, is that the customers -- mostly container-ships, oil tankers, cruise ships, dry-bulk ships and fishing trawlers -- save time by not having to wait their turn in line or suffer other logistics delays. Bunkers at Sea has done well, providing 325,000 metric tons of fuel last year -- which is a lot. It currently has two ships, and ANW is sending up a third to join the open-ocean fueling fleet.
As you know, this foray into Europe follows ANW's move into West Africa earlier this year, which looks like a smart move already, as it's an area that's highly trafficked by oil tankers, off-shore oil platform service ships and deep-water fishing fleets. There is no other permanent bunker fuel provider in the area, so ANW will be the first. Most of the West African fleet was fueling up in Gibraltar before going south, or in South Africa before rolling north. The new service center will have floating storage and three tankers, and it will go live by the end of December. ANW's other ports of service are in Jamaica, Singapore, Gibraltar, Piraeus (near Athens) and Fujairah in the United Arab Emirates.
ANW has three new double-hulled ships coming this month and two more coming by the end of 2007. After that, it has 27 more double-hulled ships on order and plans to have them on the water by the end of 2010. That means the ANW fleet will be two and a half times bigger in three years than it is today, totaling 48 modern, efficient ships. Remember that a young fleet is a key competitive advantage, as the average age of the world's bunker fuel ships is 30.
And don't forget that the new International Maritime Organization rules demanding that single-hulled bunkering ships be removed from service in major ports will kick in during 2008, so many of ANW's mom and pop rivals will have to sell out or exit the business soon. This is a perfect situation for ANW's margin expansion, which is one of the key things that I always look for in a business. If there are 130 bunkering ships in Singapore, and only 90 are double-hulled, then not only is its capacity utilization rate going to go straight up, said Tavlarios, "but you will also get upward pricing pressure."
ANW shares have moved up a lot in recent weeks, so expect some turbulence and retrenchment before too long. Shares have advanced along the nine-day exponential moving average, which is now at $42.50. A move below this level would be a short-term sell signal. But if you bought the stock after I first recommended it in the spring and wish to ensure a big profit, a protective stop at $39 would be prudent. While this is not some fly-by-night outfit whose shares are rising on a hope and a prayer, it's still a stock -- and you can bet that it can move down just as fast as it has moved up. For longer-term focused clients with tolerance for volatility, the stock is still relatively cheap based on forecasts for 2008 and 2009 earnings. I am still buying ANW on dips for my late 2008 target of $90.
Source: Jon Markman Oct 19, 2007 11:15 am,

Increase in shipping firms
The number of shipping companies based and active in Greece has grown by 4.7 percent in 2007 compared with last year, reaching 725 from 693 in 2006, according to Petrofin Research SA.
This has put an end to the decline that started in 1998, when companies were closing one after another. Back then there were 926 companies in Greece, but they declined to just 690 in 2005 due to the lack of competitiveness at small shipping firms who usually manage older vessels.

Missing captain of sunken Greek cargo ship found dead
---Greek Divers have found the body of the missing captain of "Diamond I," the cargo ship which sank on Wednesday following a collision with another cargo off the Aegean coast, reported Athens News Agency on Friday.
The remains of the 50 year-old Cypriot captain were found on Friday afternoon in the stairwell of the sunken vessel's engine room after a two-day search and rescue.
The Greek vessel carrying lignite was hit by another Panama- registered cargo ship, less than two kilometers off Thessaloniki harbor in northeastern Greece.
The vessel sank, taking its captain with it. But six other crew members were picked up by a rescue ship.
The Thessaloniki Port Authority has launched an investigation on the causes of the collision.
It was the second maritime accident near Thessaloniki this month. Last Friday, a Greek ferry collided with a fishing boat 23 kilometers off the coast. All the 143 passengers on board were safely disembarked and six fishermen on the boat were unharmed.
Source: Friday, October 19, 2007; Posted: 12:10 PM ,

Oil cleanup nearly finished
---PAULSBORO Cleanup of nearly 2,300 gallons of crude oil spilled into the Delaware River here last week is nearly complete, according to officials from Cardiff Marine.
Crude oil from the Tigani, a Malta-flagged tanker operated by Greek shipping company Cardiff Marine, was inadvertently released around 11 a.m. Wednesday.
The tanker was docked at the Citgo Asphalt Refinery.
The majority of that oil was recovered almost immediately after the spill by a containment boom that is routinely placed around vessels during the offloading procedure, according to Cardiff Marine spokesman Mike Hanson.
"They caught the spill pretty quick, so cleanup began fairly quickly," the spokesman said.
Hanson added that there had been "infrequent sightings of light amounts of oil from half a mile north to a quarter of a mile south" of the spill site, which will be cleaned up.
The state Department of Environmental Protection and U.S. Coast Guard coordinated cleanup efforts. DEP spokeswoman Darlene Yuhas said the effects on wildlife "appears to have been minimal" and confirmed that cleanup of the shoreline is nearly complete.
"We did have personnel out cleaning up throughout the weekend," Yuhas said. "There were a couple of birds that were observed with some spots of oil on them, but they eluded capture."
Wednesday's spill was the second incident at the refinery in three years.
In November 2004, the Athos I, a 750-foot single-hulled ship, released 264,335 gallons of crude oil after striking a submerged anchor near the site of the Tigani spill.
Cleanup and wildlife rescue efforts lasted almost a year, costing more than $167 million.
The Tigani, built in 1991, was originally christened the "Seafalcon" and registered in the Marshall Islands by the Canadian firm Valles Steamship, Ltd. Cardiff Marine purchased the vessel in 2005.
A representative for Citgo did not return calls for comment on Monday.
Source: Tuesday, October 16, 2007. By Siobhan A. Counihan,

DNV (Det Norske Veritas) Greek Committee Meeting 2007
---DNV Greek Committee had its annual gathering in Yacht Club on Thursday 11th October 2007.
The Committee meeting was attended by the Executive Board and the Board of directors of DNV.
The meeting marked the 35th anniversary since the establishment of the committee. Thanks to the support of the Greek Shipping community, during that period Greek owned vessels classed by DNV, increased to 20% or 26 Mil. GRT of the Greek fleet.
At the meeting a new chairman, Mr. Theodoros Veniamis and vice-chairman, Dr. John Coustas, were elected.
Source: press release

Polluted concrete coastline no lure for Greeks
---Greece is struggling to contain coastal pollution which threatens its renowned azure waters and golden coastlines, the main sources of its booming tourism industry.
"A few years ago I swam here every day but in the past two summers it is just too dirty so I just play on the beach," said 37-year-old Stavros Georgiadis, who plays racquet ball on the beach of Alimos along the capital's coast almost daily.
"I don't know if it is actually dirtier but it just looks filthier, more stuff floating on the water - I'm not going to swim in there."
Most coastal cities, including the capital Athens, northern port city of Thessaloniki and Patra in southwestern Greece, are said by the United Nations and the European Environment Agency to be major pollutants due to partly untreated industrial and household wastewater.
"Some areas in the bays of Athens and Thessaloniki are complete dead zones. For some, there is no chance of ever recovering," Greenpeace Greece Director Nikos Haralambidis said.
In a joint report issued last year, the UN Environment Program and the European Environment Agency said the bay of Elefsis near Athens with about 1,000 industrial plants, including shipyards, iron and steel works and refineries, was polluted by heavy metals, among other things.
"On a scale of one to 10 I would rate their water quality somewhere in the middle," the United Nations' Mediterranean Action Plan (MAP) coordinator Paul Mifsud said.
He said while other areas of Greece may get a better rating such as some of the islands or areas with lower population or industry accumulation, the cities' waters are suffering from poorly treated urban and industrial wastewater.
The nearby Saronic Gulf washing the capital's southern coastline is similarly polluted with industrial and primary treated wastewater from the city's sewers.
Many beaches have been declared off-limits for swimmers including some along the Faliron coast some five km from the city centre.
Once known for a multitude of pristine beaches along its coast, Athens has seen many of them declared unfit for swimming as the city's population and industrial activity grows in line with the country's economic development in recent decades.
Athens beaches are frequented mainly by local people: tourists visit only briefly during stopovers in the capital on their way to the Aegean islands.
Athens' only sewage treatment plant has yet to operate fully despite repeated government pledges. It is currently not processing sewage through the full cycle, but drying and storing it until the facility is fully operational.
The environment ministry did not return calls for comment on when the plant will be fully operating, removing chemicals and heavy metals from the processed sewage.
Greece is also staunchly backing its powerful shipping industry's opposition to an EU directive against polluting ships.
This position will grow in importance with the completion in 2009 of a Russian-Bulgarian-Greek oil pipeline that will run from the Bulgarian Black Sea port of Burgas to northeastern Greece.
Larger oil tankers will criss-cross the Aegean than those that can currently sail through the narrow and congested Bosphorus Straits, heightening the risk of oil spills and potential environmental disasters.
The government is beginning to encourage the construction of tens of thousands of holiday homes across the country, to tap into the foreign homeowners' market that has served countries like Spain and Portugal well over the past years.
Environmental groups warn these homes will put a further strain on the country's water pollution and its coastline.
With a third consecutive year of tourism growth since the Athens 2004 Olympics, Greece will host about 17 million foreigners this year.
A further rise is forecast for the coming year. Tourism accounts for about 18 per cent of Greece's GDP and roughly one in five jobs.
With 40 per cent of the Mediterranean's 46,000 km coastline already covered in concrete, action is necessary to manage the coastal zone, Mifsud said.
Greece's coastal holiday homes projects would need to be monitored closely, Mifsud said.
"If this issue is not addressed, then that (40 per cent) number will be more than 50 per cent in 20 years," Mifsud said.
"Definitely there are solutions to these problems but it is a question of priority," Mifsud said. "I would say I am hopeful and the signs are there that Greece wants to address environmental issues more actively." Reuters
Source: October 17, 2007 - 1:27PM,