Monday, 27 September 2010

Judge gives “Iorana” whistleblowers $125,000 each.

Owners Irika shipping to pay $ 4 million.


Four crew members that blew the whistle on a ‘magic pipe’ bypassing the oily water separator aboard the Greek owned ship Iorana have been awarded $125,000 each by a judge in Maryland, USA. The owners, Irika shipping, had already agreed to a $4 million fine after they pleaded guilty in July.


When the Iorana arrived in Baltimore in January this year, a Filipino crewmember passed on a note to a customs inspector, saying that a bypass ‘magic pipe’ had been used on instructions of Chief Engineer Marmaras to pump out about 23 m3 of oily water directly overboard. The note said: “We are asking help to any authorities concerned about this, because we must protect our environment and our marine lives.” The four whistleblowers had taken photographs with a cell phone as evidence.

Some oily rags were also thrown overboard at night at sea. An investigation discovered the magic hose arrangement; Marmaras pleaded guilty in June and the owners followed suit a month later. Interestingly, Irika Shipping was prosecuted for a similar offence three years ago in connection with another vessel, the Irika, and fined $500,000; the Irika’s then Chief Engineer was reemployed as Marmara’s predecessor on the Iorana and continued the illegal practice, a fact that must have contributed to the court’s displeasure and the much heavier fine this time.

A US Department of Justice press release says that the Panamanian registered Irika Shipping has entered into a multi-district plea arrangement with the Districts of Maryland, Western Washington and Eastern Louisiana (States where the Iorana used to call) and will pay a $4 million total penalty, be placed on probation for a maximum period of five years and be subject to the terms of an Enhanced Environmental Compliance Program.

The owners admitted that 23 cubic meters of oil contaminated sludge and bilge waste were dumped overboard in December 2009 during the voyage from Gibraltar to Baltimore using the 103-foot bypass hose. Additional illegal discharges were also made in previous months. Logbooks were doctored. The company also admitted to hiring back the convicted Chief Engineer from the Irika who committed similar offences on the Iorana before Marmara. In addition, authorities had charged senior officers of the Iorana of lying to authorities in the US and pressurising crew to do so.

The $4 million penalty includes a $3 million criminal fine and $1 million in organisational community service payments that will fund various marine environmental projects. The whistleblowers were awarded a total of half a million dollars out of the fine: US law entitles them to up to half the fine.

“This was a case of wilful and deceitful pollution, and the corporation responsible is being held accountable,” said Rear Adm. Lee, Commander of the Coast Guard’s 5th District. “This case should serve as a deterrent to those who would violate marine pollution laws.”

Thursday, 23 September 2010

Landlocked Indian States to have ports in Gujarat?

Coming close on the heels of the successful Gujarat Pipavav Port IPO recently, media reports now suggest that the Gujarat Government will rebrand itself as a “Global Business Hub’ in the ‘Vibrant Gujarat Global Investment Summit' (VGGIS) to be held in January 2011. A path-breaking proposal at that summit will be the invitation to landlocked Indian States to set up ports in Gujarat: amongst the states being targeted include Punjab, Rajasthan, Madhya Pradesh and Chhattisgarh. This is the first time in India that such an initiative will be proposed.


Gujarat has a coastline of more than one and a half thousand miles and its administration has long been applauded for bold steps taken in the maritime sector. The State has been in the forefront with forward looking policies in the port privatisation and shipbuilding, besides others. Pipavav, Dahej and Mundra are successful privately operated ports, and APM Terminals at Pipavav and DP World at Mundra are well known international brands. The successful listing of Pipavav’s IPO early this month will no doubt help Gujarat in attracting interest in these new plans: the counter opened at a premium of more than twenty percent to its issue price at the Bombay Stock Exchange, ending the day with a combined trading volume of more than 167 million shares between the BSE and the National Stock Exchange. The IPO was subscribed almost twenty times.

“We will facilitate the landlocked States to take advantage of our coastline,” Maheshwar Sahu, Principal Secretary of the Gujarat Industries and Mines Department, says in the Hindu’s Business Line newspaper. Mr Sahu is in charge of the VGGIS summit and is understood to be in touch with more than a dozen States across India to seek partnerships for the future.

The VGGIS Summit is held every two years. In the last one in 2009, Gujarat was marketed as ‘The Growth Engine of India'. Two years later, the ambitious administration wants to rebrand the state as a global business hub. It intends to rope in investors, opinion makers and other think tanks to push this initiative. Japan and Canada are official partners for the 2011 event that the Government calls the 'next Davos in action'. Chief Minister Narendra Modi is said to have been behind the move to invite port proposals from landlocked Indian states as well. The Government is also pushing what it calls its record of good governance with interested parties. It intends to take a road show across India before the event to showcase Gujarat’s attractiveness as an investment destination.

Besides shipping and ports, next year’s VGGIS will zero in on sectors such as oil and gas, infrastructure, financial services and shipbuilding. The state also has plans to attract talent from the premier Indian Institutes of Technology before the inauguration of the summit on Jan 10 next year. “Our objective is to have a platform on which about 80 to 100 IITians, having an interest in Gujarat, assemble for brainstorming on the important technology interventions required in the State for leapfrogging in economic development”, Mr Sahu says.

Thursday, 9 September 2010

Nordic Barents: going over the Arctic top

The Norwegian bulk carrier ‘Nordic Barents’ will be the first non Russian cargo ship to use the alternate Arctic route between Europe and China. It started last week from Norway even as a series of accidents in the frigid waters of the north had scientists raising questions on environmental consequences of such voyages. Nevertheless, "We're pretty much going over the top," said John Sanderson, the CEO of the Norwegian iron ore mine.


Carrying a full load of 40,000 tonnes of iron ore, the bulker will save up to two weeks and a couple of hundred thousand dollars by using the northern route from Europe to Asia; the alternative normal route would have been via the Suez Canal and the Indian Ocean. Tellingly, the with lower piracy risk by avoiding Somali piracy is stated to be a factor in the decision.

Two German ships did make voyages to Arctic Russia last year, but the Nordic Barents is the first foreign ship that Russia is allowing to pass through without stopping. Rostomflot, the Russian state owned icebreaking company, has earmarked two icebreakers to escort the Nordic Barents for 10 days of the voyage between Novaya Zemlya and the Bering Strait; no doubt the Russians see this as a great business opportunity, though officials are tight lipped on icebreaker or fee costs.

Meanwhile, the receding Arctic ice cap, matching the worst seen on record, has scientists worried. While global warming is being blamed for this phenomenon, there are growing concerns about the increasing willingness of shippers, owners and charterers to send ships through the huge and frozen expanse of northern water. There are also questions that much of the route, used by only domestic Russian vessels, has insufficient emergency facilities or places for refuge.

The polar ice sheet is as big as the U.S. even after the present summer melt, according to experts, and the waters are incompletely charted. They point to the Canadian tanker Nanny that recently ran aground on an uncharted sandbar in the Simson Straits of the Northwest Passage carrying almost 10 million litres of diesel meant for remote Arctic Canadian communities. Although no fuel has leaked from the double-hulled tanker, a Canadian coast guard ship is standing by to assist at the time of this report. The Nanny is the third ship in the last month to run aground in the Canadian Arctic. The cruise ship ‘Clipper Adventurer, ran aground on Aug. 27 on an uncharted rock between Port Epworth and Kugluktuk; it was two days before the 128 passengers could be transferred to an icebreaker and safety ashore. Earlier, another tanker ran aground off Baffin Island before being refloated at a later high tide.

General Manager of Desgagn├ęs Transarctik, operating in the area, says that the problem is that Arctic areas are charted very narrowly. "The charts are reliable. The problem is that you have to be able to stay within [them]. The charts are not complete in a sense that if you are not able to stay within, for whatever reason, you might find yourself very easily in uncharted waters."


These concerns are unlikely to deter commercial managers. CEO Sanderson is quoted in the newswires as saying, “Somebody's got to blaze the trail and prove to the rest of the world that this is a commercially viable route that can be transited quite safely."

The problem, critics say, pointing to the potential for environmental catastrophe if something goes awry in the sensitive Arctic, is that ‘quite’ may not be quite good enough.

Cook’s family to get almost half a crore after he dies on board.

CHENNAI: The Lok Adalat (People’s Court) in the city has settled an amount in excess of 46 lakhs that is to be paid to the family of a cook who died on board a ship almost eight months ago. The compensation will be paid to the four legal heirs of Mr. Ramaiah Murugaiah, the crewmember who died on the ‘Siam Sapphire’ while she was in Saldanha Bay, South Africa in December last year, the Adalat has ruled on September 1.


As per the outcome of the Adalat’s proceedings, Rs.46,36,400 will be paid to Murugaiah’s wife and three children. The cook’s wife Mrs M Sethu and the other heirs had represented to the Adalat that her husband had signed on the Siam Sapphire on October 4, 2009 after signing a contract. On December 29, her husband died of cardiac arrest while the ship was in Saldanha Bay. The ship’s owners, M Sethu complained, had not paid compensation under the rules of the International Bargaining Forum accepted by the International Maritime Employees Committee presently in force. Siam Sapphire, a bulk carrier, is owned by Siam Jewels Marine Limited, Bahamas, and represented in Chennai by Pioneer Marine Services Pvt. Ltd of Mylapore.

Ms Sethu said in her complaint that she and her children were entitled to $60,000, i.e. $15,000 for each member of the family. A pre-litigation agreement was finally reached at the Lok Adalat presided over by Justice N.V. Balasubramanian (retired), with two other members present. Lok Adalats are established by the government to settle disputes through conciliation and compromise and accept cases that are pending in the regular courts within their jurisdiction. Presided over by a sitting or retired judicial officer as the chairman, the Adalats are free for litigants and their decisions are legally binding. Their main condition is that both parties should agree to settle. A lawyer and a social worker sit in at the proceedings as members.

In this case, around Rs 3 the owners had already paid lakhs after Murugaiah’s death. The cook’s widow then approached the Adalat for the remainder of the compensation. On notice from the Lok Adalat, the owners agreed to pay roughly Rs 25 lakhs to the wife and about Rs 7 lakhs to each of the three children, totaling Rs 46,36,400. The amount was arrived at after “mutual discussions, negotiations, mediation and conciliation between both parties”, according to the Adalat.

Later, the Adalat and the Chennai High Court felt that the interests of the children would be best served by dividing the total amount equally between the four claimants; the parties agreed to this. Ms Sethu and her children will now share the compensation equally. Since the children are minors, their share of the compensation will be deposited in a fixed deposit in a nationalised bank until they become adults.
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Monday, 6 September 2010

Ukrainian Officers sentenced to nine years in Venezuela for drug trafficking.

But are they innocent?


Two Ukrainian officers of the cargo vessel, the “B Atlantic”, have been sentenced to nine years in prison in Venezuela for drug trafficking. Captain Volodymyr Ustymenko and Mate Yuriy Datchenko have already spent two years in Venezuela after 128 kgs of cocaine was discovered welded on to the hull of the vessel in 2007. The August 13 ruling has dismayed many observers. Their lawyer Aurelio Fernandez says that they would have been acquitted in any other country, and the convictions are “purely political.”


Worse, The Komsomolskaya Pravda v Ukraine newspaper reports that the two officers could be sent to the island of Margarita, one of the world's worst prison colonies. "This place is infamous, and few people have managed to return from there," the newspaper says. It is believed that diplomatic pressure is being put by Ukraine on Venezuela, although the two countries have limited relations.

The two officers were arrested while on the 38,056-dwt bulker B Atlantic on August 12, 2007, when Venezuelan divers found 128 kg of cocaine clamped to the ship’s hull while it was moored in Lake Maracaibo. Capt. Ustymenko had told Lloyd’s List later that he was completely innocent. Their delayed trial saw the Ukrainian President and the Foreign Minister sending letters to Venezuela asking that it conduct the trial of the two Ukrainians under proper conditions.

Observers say that the two seem to be caught in a political game being played by Venezuelan President Hugo Chavez. Capt. Ustymenko had indicated that much when he spoke last year, after spending 18 months in detention in an apartment in Venezuela, “I think it is for political reasons. Why should we stay here for so much time? Because the Venezuelan government wants to react about narcotic trafficking. We are not involved in this. How can we be, because these drugs were found about 10 m underwater near the propeller? That is why the crew and my security officer were not involved in this situation. We are innocent.”


Analysts saw that drug smugglers in Venezuela use a technique that was popular in Colombia until underwater inspections became compulsory for all ships leaving the bigger ports in that country. It is a travesty of justice, they claim, that crews and ships are seized in Venezuela if drugs are found welded on to the vessel. The seizure of the B Atlantic is not a unique case. Two years ago, the tanker Astro Saturn had been similarly detained. Two Greek officers were arrested from that vessel after cocaine was found attached to the hull of the ship in Puerto La Cruz in November 2008. Fernandes says, “Any owner that travels to Lake Maracaibo or Venezuela in general, and has the bad luck to have one of these criminal organisations attach a drug device underwater, is at risk of losing the vessel and crew.”

B Navi, the managers of the B Atlantic, had decided after the incident to stop operating in Venezuela. The Italian owners of the B Atlantic estimated the loss of millions of dollars of lost earnings, besides huge losses in the value of the vessel as she is effectively laid up and her condition has deteriorated.

Capt. Ustymenko’s daughter has been fighting a lonely battle on her father’s behalf back in the Ukraine. She had said last year that despite writing to the President of the Ukraine and to human rights organisations, “we don’t get any answer. They just say that the matter is under consideration.


She added, at the time, that her father was innocent. “He has been a sailor for 35 years, 24 years as a master. He has worked all his life as a sailor. He is not a drug dealer”.

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