Tag: corporate

Platform News – Worker killed when breaking the Hanjin Rome

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And another worker dies in May at Chittagong yard with an appalling accident record

 

Two workers lost their lives at the Chittagong shipbreaking yards in the last two weeks, bringing the total death toll this year to six workers.

 

On 6 May, 26-year-old Shahinoor died at Jamuna Shipbreaking yard. He fell from a great height when he was breaking the HANJIN ROME, which was the first vessel arrested after the collapse of one of the largest container ship companies last year – the Korean company Hanjin Shipping. The HANJIN ROME was put up for auction by the High Court in Singapore to be sold to the highest bidder early this year. Unsurprisingly, the highest bids for buying ships for scrap come from cash buyers that sell to the South Asian beaching yards who can offer higher steel prices with minimal disposal and labour costs and safeguards. This is not the first time that courts, in deciding on bankruptcy cases, completely ignore the environmental and human repercussions of selling shipping assets to beaches, with the sole purpose of sorting out failed companies’ balance books. Deaths on the beaches have also been a direct consequence from bankruptcy cases in Germany, such as the sale of the KING JUSTUS to Alang and the VIKTORIA WULFF to Chittagong.

 

On 9 May, winch operator Ishaq was smashed by the wire cable and died on the spot at KR Steel. This is the second fatal accident this year at the plot – another fatal accident happened in February at BBC Shipbreaking yard which is under the same ownership as KR Steel. According to local sources, KR Steel was dismantling the vessels SEA ZENITH and KOTA WISATA when Ishaq was killed. The former was owned by the Thai shipping group Sang Thai & Sinsimon. The latter was owned by Singapore-based Pacific International Lines (PIL), one of the top containership operators in the world. PIL sent nine end-of-life vessels to the beaches of South Asia in the last four years. Six ended up in the worst yards on the shores of Chittagong.

"Shipping companies globally are aware of the dangerous and polluting practices on the breaking beaches in South Asia. The higher profit that ship owners make by selling to cash buyers has a human cost and an environmental cost. That insolvency administrators appointed by the courts in Singapore and Germany have been allowed to trade unprofitable ships to the beaches of South Asia is shocking."
Ingvild Jenssen - Policy Director - NGO Shipbreaking Platform

Earlier this year the Institute for Global Labor and Human Rights (IGLHR) published a detailed account of the fatal accidents that killed 19 workers in Chittagong in 2016. The report includes interviews with workers that describe harsh conditions, lack of protective equipment, exposure to toxic gases and fumes, and a constant fear of dying at work: “There are enclosed dark places on the ship, where there is no ventilation. The cutters go in first [to cut holes in the sides to let light in]. Especially they get sick and nauseous,” a worker reports to IGLHR. “All of us cutters get sick from the chemicals. It always happens,” other workers add. “I work at night because the owner wanted me to work the night shift,” says a worker, adding “it is cooler. You sweat less. So for me, it is better. But it is more dangerous. That is the biggest worry: It is very risky. At any time, I could lose my life”.

 

Activists and workers in Bangladesh recently raised their voices on two important days for workers’ rights. On 28 April, the World Day for Health & Safety at Work, the Platform member Bangladesh Occupational Safety, Health and Environment (OSHE) foundation organised a rally and a human chain to raise awareness on the precarious conditions at the Chittagong shipbreaking yards. Workers affected by asbestosis or having suffered injuries joined OSHE for further discussions on how to strengthen claims for compensation. On 1 May Chittagong-based Platform member Young Power in Social Action (YPSA) organised a human chain and a rally gathering more than 100 workers and their family members.

"Six workers have died this year. Many more workers have suffered serious injuries. Safety and workers’ rights are shamefully being ignored in most yards. Whereas the Bangladesh Shipbreakers’ Association is reluctant to take any action on the yards where workers are dying, the Courts should act immediately to ensure that no yard is allowed to operate in breach of national laws on occupational safety and environmental protection."
Muhammed Ali Shahin - Bangladesh Project Coordinator - NGO Shipbreaking Platform

In an attempt to hide the accident, the yard management kept the body of Shah Jahan inside the premises, but fellow workers and locals rushed to the site and started demonstrating. The body was consequently sent to the morgue of the Chittagong Medical College Hospital. The following day, the worker was quickly buried without a post mortem. Platform member organisations in Bangladesh attended the funeral and now seek to support the victim’s relatives. The family and the yard owners have settled for a one-off payment and a monthly allowance to help them cover their living costs. However, money will not be able to replace Shah Jahan who leaves behind a wife and a young child.

 

© NGO Shipbreaking Platform – Hanjin Rome beached in Chittagong, Bangladesh

 

 

 

Platform News – NGO Shipbreaking Platform presents Annual Report 2016

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The NGO Shipbreaking Platform presents its Annual Report 2016.

 

Last year, at least 52 workers lost their lives on the shipbreaking beaches in South Asia. The worst explosion in the history of shipbreaking struck an oil tanker beached in Gadani, Pakistan, killing 28 workers and injuring more than 60. The NGO Shipbreaking Platform is working to ensure that shipping companies sell their obsolete vessels to safe, clean and just recycling facilities. Thanks, in no small part, to the continued efforts of the NGO Shipbreaking Platform and its member organisations, concerned policy makers and industry with a stake in shipping are increasingly echoing this demand. Check the new Annual Report to find out more about global shipbreaking practices and the NGO Shipbreaking Platform's activities in 2016.

 

Support our work to prevent the human rights abuses and environmental injustice provoked when ships are traded to dirty and dangerous breaking yards! Share this publication.

 

Download the Platform’s Annual Report 2015 here, or send us an email to order a hard copy.

 

 

Press Release – Controversial Tide Carrier under arrest in Norway

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Attempt to illegally export the ship to Pakistan revealed

 

After having been informed by the NGO Shipbreaking Platform and its member organisation Bellona that the TIDE CARRIER (now named HARRIER, aka EIDE CARRIER) had been sold for illegal, dirty and dangerous scrapping to a South Asian beaching facility, the Norwegian environmental authorities arrested the ship on Tuesday 5 April [1]. The vessel is not allowed to leave Norway unless it is to sail to a ship recycling destination in line with international and European hazardous waste laws. According to the Norwegian Environment Agency, it is the first arrest of a vessel in Norway for the illegal export of hazardous waste.

 

The Platform had been informed already during the summer of 2015 that the ship was sold for scrap. Having been laid up for many years on the Norwegian west coast the Platform immediately contacted the Norwegian owners Eide Group to make them aware of the laws governing end-of-life ships and that exporting the vessel to a South Asian beaching yard would be in breach of the European Waste Shipment Regulation and the UN Basel Convention. Eide Group denied then that the vessel would be scrapped.

 

On 22 February 2017 the vessel attempted to leave Norway under a new name, flag and registered owner. Now called TIDE CARRIER, the ship had swapped its flag to that of Comoros and was registered under an anonymous St. Kitts and Nevis based post-box company, Julia Shipping - all solid indications that a cash buyer, a scrap dealer specialised in the trading of end-of-life ships to the South Asian beaching yards, was involved.

 

The TIDE CARRIER however ran into difficulties as the engine stopped working outside the Norwegian coast of Jaeren. The coastguards were forced to trigger a salvage operation, complicated by way of the weather conditions, to avoid the risk of oil spill and grounding close to one of the most renowned beaches in Norway. The rescue operation included the emergency evacuation of 5 crew members - one of which suffered from a broken shoulder – and the deployment of two tugboats to bring the ship to safety.

 

Norwegian authorities have since then been trying to trace the owner and insurer of the vessel, given that someone should be held accountable for the costs of the rescue operation incurred by the Norwegian state. While the authorities investigated the ownership and condition of the vessel, it remained docked in Gismarvik, Norway.

"We immediately informed Norwegian authorities that the ship was most likely sold for scrapping in South Asia and also that there were suspicions that the ship had been used to store hazardous sludge."
Ingvild Jenssen - Policy Director - NGO Shipbreaking Platform

On Monday 4 April the Environment Agency and the Police found evidence that the vessel was under a “break up voyage” insurance from Norway to Gadani, Pakistan. They also found unidentified and excessive amounts of sludge and fuel oils. The previous week, while the vessel was still in the dock, the TIDE CARRIER changed name to HARRIER and changed from Comoros to another popular end-of-life flag: Palau. Consequently, it became clear that the repair contract from the Middle-East which had been provided to the Norwegian authorities as a way to escape checks for the illegal export of the vessel was false. Revelations of the attempt of the ship’s illegal export and subsequent breaking on the Gadani beach resulted in the arrest of the ship.

 

This is not the first time cash buyers seek to circumvent environmental protection laws by providing fake contracts of repair or further operational use. Recently the Norwegian owned CITY OF TOKYO was allowed to leave the port of Antwerp under the pretense of repair work in Dubai – instead it sailed directly to the infamous beaching yards in Bangladesh. The FPSO NORTH SEA PRODUCER was also illegally exported from the UK to Bangladesh under the pretense of further operational use in Nigeria [2]. Cash buyer GMS used grey- and black listed Paris MoU flags and established anonymous post box companies in both cases.

"The cash buyers of TIDE CARRIER will not only have to pay back the Norwegian authorities for the rescue operation, but will also have to answer for the fake repair documents which were used to let it sail in the first place. Norwegian owner Eide will have to be held responsible for having sold to a cash buyer as this clearly indicates their complicity in the attempt to illegally export the ship and the potentially toxic excess sludges and fuels found on board."
Ingvild Jenssen - Policy Director - NGO Shipbreaking Platform
© LN Kyv/The NCA

Press Release – Platform publishes list of ships dismantled worldwide in 2016

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European ship owners top the list of global dumpers: the EU must do more to reverse this scandal

 

Read our country-specific press releases:
Brazil | Germany | Greece | Italy

 

The list of all ships dismantled around the world in 2016, which the NGO Shipbreaking Platform has compiled and analysed, shows no improvements of the shipping industry’s management of its end-of-life vessels. Far from it: the Platform today releases data that indicate an increase in the number of ships sold for polluting and unsafe shipbreaking on the beaches of South Asia. In 2016, a total of 668 vessels were broken on tidal beaches, that is as much as 87% of all tonnage dismantled globally.

"The shipping industry is nowhere close to ensuring sustainable ship recycling practices. Last year, we saw not only an increase in the market share for dangerous and dirty shipbreaking, but also a record-breaking number of EU-owned vessels on the South Asian beaches. A jaw-dropping 84% of all European end-of-life ships ended up in either India, Pakistan or Bangladesh. Beaching yards are not only well known for their failure to respect international environmental protection standards, but also for their disrespect of fundamental labour rights and international waste trade law."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

A higher number of ships beached means that workers, the environment and local communities in South Asia are exposed to ever increased hardship. 2016 saw the worst catastrophe in the history of the industry: on 1 November, at least 28 workers were killed instantly and more than 50 injured when an explosion and a massive fire shook a tanker beached in Gadani, Pakistan. The death toll in the Bangladeshi yards, which the Platform was able to document, reached 22 in 2016, with another 29 workers having suffered serious injuries. Whilst accident records in Indian shipbreaking yards are kept a secret, the Platform was informed of at least two fatal deaths in Alang.

 

DUMPERS 2016 - Worst practices

 

The worst dumper prize goes to IDAN OFER, son of shipping magnate Sammy Ofer. Idan Ofer owns QUANTUM PACIFIC GROUP and has a controlling stake in It may seem a big surprise for a country whose industry is proud of green technology and engineering solutions, but GERMANY is responsible for the worst shipbreaking practices amongst all shipping nations when one compares the size of its fleet to the number of ships broken irresponsibly. German owners, banks and ship funds had a staggering 97 ships rammed up on the beaches of South Asia out of a total of 99 vessels sold for demolition: 98% of all obsolete German ships ended up on a beach! That not being enough, close to 40% were broken in Bangladesh, where conditions are known to be the worst. Amongst the most irresponsible owners are Hansa Mare with 12 ships, Alpha Ship, F. Laeisz and Peter Doehle with 7 each, and Dr. Peters, König & Cie, Norddeutsche Vermögen and Rickmers with 6 each.

 

The German shipbreaking practices come with a high death toll. During the breaking period of the RENATE N. at Seiko shipbreaking in Chittagong, Bangladesh, three workers were killed and three more injured (see “Accidents” in the Platform’s South Asia Quarterly Update). The vessel owned by Neu Seeschifffahrt had been traded through cash buyer Wirana. Even the UN Special Rapporteur on Toxics and Human Rights expressed serious concerns in a submission to the German Government, criticizing the substandard practices of German owners. In November, another Bangladeshi worker was killed during the demolition of the only 10 year-old, loss-making container ship VIKOTRIA WULFF.

 

“It is not the first time that shipbreaking workers pay with their lives for the failed business practices of German ship owners and their ship funds. Due to numerous bankruptcies resulting from short-sighted and high-risk investment, insolvency administrators appointed by the courts quickly trade the unprofitable ships to the beaches of South Asia, and the bill for the shipping industry’s greed is paid by people and the environment”, comments Patrizia Heidegger.

 

GREECE was responsible for the highest absolute number of ships sold to South Asian shipbreaking yards in 2016: 104 ships in total. Since the Platform has started to compile data in 2009, Greek shipping companies have unceasingly topped the list of owners that opt for dirty and dangerous shipbreaking. Backed by the Greek government, they continue to refuse liability for the damage done to workers and the environment. A Greek ship beached in Pakistan in December 2016 caused the death of five workers in January when a fire broke out on the GAZ FOUNTAIN owned by Athens-based Naftomar.

 

The worst corporate dumper prize goes to the UK-based ZODIAC. The company is operated out of London and owned by Eyal Ofer, son of late shipping magnate Sammy Ofer. Zodiac alone has sold 12 ships for breaking on the beaches in 2016, mostly to Bangladesh, and the company has been linked to severe accidents. During the demolition of Ofer’s ship SNOWDON, beached in Pakistan in October, a worker was killed in January this year. Eyal’s brother Idan, owner of the QUANTUM PACIFIC GROUP and holder of a controlling stake in the ISRAEL CORPORATION, received the worst dumper award in 2015 for selling most of his end-of-life vessels to Bangladesh breakers – a more than dubious practice for a family that wants to be known for its philanthropy.

 

"It is scandalous that the burden to deal with Europe’s profit-greedy shipbuilding boom is shifted to communities and workers in South Asia: first the shipping industry creates a large overcapacity on the market, and then it fails to find responsible solutions for its obsolete ships."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

In 2016, also Maersk decided to take a U-turn on its previously progressive ship recycling policy: the Danish container ship giant decided to go back to the shipbreaking beaches of India where it is offered higher prices for its unwanted ships. Being one of the catalysts of the overcapacity on the shipping market itself, Maersk has to get rid of 75 – 100 ships in the coming years.

"This move to boost profits does not only help to rubberstamp the beaching method, but, very regrettably, it is also stalling real progress and innovation in India to move ship recycling to the next level – off the beach – to modern ship recycling facilities."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

Ship owners sell their vessels to South Asian yards via cash-buyers, companies that specialise in the trade of end-of-life tonnage. Cash-buyers promise ship owners not only the highest price, but also to rid them of their responsibility to properly deal with the end-of-life management of their ships. [2] Ships contain large amounts of toxic materials such as oil sludge, asbestos and paints laden with heavy metals and would yield less profit at end-of-life if sold to a recycling facility that firmly follows environmental and occupational health and safety standards.

 

The data compiled by the Platform also show that ship owners continue to shield themselves from responsibility through the use of cash buyers such as GMS and Wirana. These scrap dealers reflag end-of-life vessels to last-voyage flags of convenience, such as Palau, Comoros and St Kitts and Nevis, and sell them off for the highest price offered by the worst yards.

"Looking at the flags used at end-of-life, it is clear that legislation based on flag state jurisdiction will not be able to bring substantial change to the current practices: who believes that a non-compliant flag and a cash buyer benefitting from the worst conditions will enforce improvements in shipbreaking yards? The global shipbreaking crisis can only be solved through measures that go beyond flag state jurisdiction. That is why we call on the EU to demand a ship recycling licence from all vessels visiting EU ports."
Ingvild Jenssen - Policy Director - NGO Shipbreaking Platform

In 2017, the EU will publish a list of ship recycling facilities around the world that comply with high standards for environmental protection and workers’ safety. The list will be the first of its kind and an important reference point for sustainable ship recycling. German container line Hapag-Lloyd has already committed its end-of-life ships off the beach, and has announced that it will only use EU listed facilities. A financial incentive affecting ships trading with the EU is however needed to ensure that irresponsible ship owners are directed towards the facilities listed as approved by the EU. A proposed Ship Recycling Licence scheme is now being discussed. The many scandals involving European shipping companies are also a driver behind the strong interest that various financial institutions have started to show in ship recycling: to ensure responsible business practices some are now setting criteria for shipping companies they finance while looking at the EU Ship Recycling Regulation for guidance.

 

For the list of all ships dismantled worldwide in 2016, click here.
For detailed figures and analysis on ships dismantled in 2016, click here.
For background information on global ship dismantling practices, click here.

 

 

 

Platform News – No more dead workers!

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Platform calls for responsible solution for Berge Stahl, flag ship of the Port of Rotterdam

 

The Berge Stahl, one of the world’s largest iron ore bulkers, made its last visit at the Port of Rotterdam last week. The NGO Shipbreaking Platform calls on the ship owner, Berge Bulk, and the Dutch authorities to ensure the responsible recycling of the 30 year old vessel. Berge Bulk, founded and lead by James Marshall and headquartered in Singapore, is one of the world’s largest operators of dry bulkers and has recently sold several of its end-of-life ships to substandard shipbreaking yards on the beaches of South Asia. At least two workers were killed and four more injured at Seiko Steel shipbreaking yard in Bangladesh earlier this year while the bulker company’s Berge Matterhorn was under demolition there. The Berge Stahl has called at Rotterdam’s ore terminal 249 times over the last 25 years. It was for a long time the largest dry bulk vessel in the world and considered to be the Port of Rotterdam’s unofficial ‘flag ship’. The Port of Rotterdam bid farewell to its iconic ship last week.

"Both the Port of Rotterdam and the Dutch authorities must have an interest in the responsible recycling of its ‘flag ship’ that made many in the port proud and regularly attracted fans. We call on Berge Bulk, a company so far known for irresponsible shipbreaking practices with fatal consequences to see this as an opportunity to review its scrapping practices and commit to responsible recycling. For a company that claims that ‘sustainability is at the core of everything we do’ and promises ‘people first’ and ‘clean planet’, ship recycling in a modern facility off the beach is mandatory. Dead workers and a polluted environment in Bangladesh do not go well together with the desired clean image."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

Apart from the fatal and severe accidents at the yard that was cutting down the Berge Matterhorn in Bangladesh, the Berge Vik and the Berge Prosperity ended up on the beaches of Gadani, Pakistan, in May last year. The destination has recently been shaken by the worst explosion in the history of the shipbreaking industry that resulted in at least 28 workers dead and more than 50 men severely injured.

 

Given the age of the vessel and the current low freight rates, experts assume that the Berge Stahl is soon going for demolition. When the vessel arrived in Rotterdam, the Platform alerted the Dutch authorities to ensure that the ship, which becomes hazardous waste under European and international environmental law once there is an intent to sell it for scrap, will not be illegally exported to the infamous shipbreaking beaches of India, Pakistan or Bangladesh. While the authorities have taken the case very seriously, Berge Bulk was able to reassure them that the vessel will continue to be operated and will go for dry docking in China. The Platform is now closely monitoring every move of the ship.

"The vessel’s story is a very good example of why a European Ship Recycling License is necessary to ensure responsible ship recycling in the future. The Berge Stahl has been coming to Rotterdam for 25 years on a very regular basis delivering iron ore for German steel producer Thyssen. If Berge Bulk had set aside funds over 25 years through a mandatory Ship Recycling License, the ship owner would now have a strong incentive to recycle it in an EU-approved facility in order to be able to recover the accumulated moneys – even though the CEO sits in Singapore and could easily circumvent the European Ship Recycling Regulation by swapping the ship’s current flag, Isle of Man, to one outside the EU. We call on European lawmakers to effectively regulate the end-of-life fate of ships that have such close ties to EU trade by supporting financial incentives such as the Ship Recycling License."
Ingvild Jenssen - Policy Director - NGO Shipbreaking Platform

Press Release – Danish opposition parties call on Government to stop beaching of Maersk vessels

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Questioned Minister lacks political direction on ship recycling

 

The Danish Environment Minister, Esben Lunde Larsen, had to answer to the Parliament yesterday following questions put to the Government by all the opposition parties. The long list of questions had been drafted two months earlier, prompted by the revelations of Maersk’s shipbreaking practices in South Asia by the Danish investigative journalists, Danwatch, and the daily newspaper Politiken. All opposition parties called on the Danish Government to ensure that Maersk’s end-of-life vessels cannot be broken down in beaching yards.

 

Apart from a semi-attempt to filibuster by reading out the already available written answers and paraphrasing the Hong Kong Convention, the Minister insisted on quoting technical details and the obligation to follow the law. He was unable to give political direction on how the Government would work to stop Danish companies’ use of the polluting and dangerous beaching practices in South Asia and on Maersk’s threat to swap the Danish flag for a non-EU flag if the EU does not approve ship recycling on the beaches of Alang. The MPs present, representing the spectrum of Danish opposition political parties (including Social democrat member of parliament, Christian Rabjerg Madsen, and the head of Socialistisk Folkeparti, Pia Olsen Dyhr, as well as Ida Auken from Radikale Venstre, Christian Poll from Alternativet, and Marie Reumert Gjerding from Enhedslisten) and the Chair (Pia Adelsteen from Dankse Folkeparti), incessantly pressed the Minister to answer concrete and direct questions on the Danish government’s position on beaching, Maersk’s threat to flag out, and whether the government is pressing the EU Commission to list beaching yards in Alang on the upcoming EU list of accepted facilities world-wide.

 

If ships were broken on beaches in Denmark there would be an uproar, the MPs stated. They asked the Minister to outline how he thought safe working conditions and protection from pollution could ever be ensured when dismantling a vessel in the intertidal zone of a beach, and clearly requested the Minister to provide strong political support to end beaching. To all the questions and comments, the Minister however repeatedly appealed to his ignorance about the shipbreaking industry and to the literal text of the EU guidelines under the Ship Recycling Regulation. Whilst the Minister admitted that flagging out to circumvent EU law is not compatible with responsible business practices, he refused to answer how he would make sure that Danish shipping companies only use facilities that are on the upcoming EU List of approved recycling practices, and which is not expected to include facilities that use the beaching method. Clearly, Minister Lunde Larsen, in the two months he had to prepare before the meeting with the MPs, chose to only be briefed by the interested lobby groups who promote beaching practices; most notably the biggest company in Denmark, Maersk.

"It is shocking that the Minister gave no political comment or direction, but rather only contained a copy-pasted quotation fed to him by Maersk. It reveals the lack of political backbone when we see that Maersk is in such a powerful position to issue statements on behalf of the Danish government and that the Minister seems to believe this is acceptable."
Ingvild Jenssen - Policy Director - NGO Shipbreaking Platform

The insistent drilling by the MPs to the Minister on the government’s position on beaching left no time for Esben Lunde Larsen to answer all questions. The MPs would have particularly liked to go into more depth on issues related to the government policy to enhance the ship recycling industry in Denmark, and crucially on the government’s engagement to investigate on the illegal export of the Maersk-owned oil production and storage tanker, North Sea Producer, from the UK to Bangladesh. At the end of the meeting, Pia Olsen Dyhr (SF) called for another meeting with the Minister to discuss these issues more in detail.

 

 

 

Platform News – Worker killed in yard breaking German-owned container ship “Viktoria Wulff”

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On 4 December, worker Shah Jahan was killed on the spot at Arefin shipbreaking yard in Chittagong, Bangladesh, where German container ship “Viktoria Wulff” (IMO 9252101) is currently being dismantled on the beach. The 35-year old man, who was made to work without any safety measures, was struck on the head by a heavy iron piece.

 

German ship owner Wulff went bankrupt in August and the insolvency administrator is currently selling off the company’s remaining vessels. The “Viktoria Wulff” became the youngest container ship to be sold for demolition at an age of only 10 years without a previous accident.

"The story of the ‘Viktoria Wulff’ is characteristic for the failed business practices of German KG ship owners as well as ship funds. Nearly 600 ships have been sold due to insolvencies and financial problems since 2008, many of which ended up on the South Asian beaches. The bill for the ship owners’ and investors’ greed for profit is paid by workers and the environment in destinations like Bangladesh, where ships end up without any consideration of the human and environmental costs. It is a scandal that German liquidators, who are appointed by the courts, sell end-of-life ships to substandard breaking yards risking peoples’ lives through deals that are in clear breach of international and even domestic Bangladeshi law just to sort out the books for German ship owners."
Patrizia Heidegger- Executive Director - NGO Shipbreaking Platform

This is not the first case of fatal accidents in the shipbreaking yards of South Asia that the Platform was able to link to bankruptcies of German ship owners. Last year, the Platform, together with broadcaster NDR, revealed the case of the “King Justus” which was sold after the insolvency of König & Cie. A worker was killed breaking the ship on the beaches of Alang, India. At the time, the Environment Minister of North German state Lower Saxony also criticised NordLB, a bank with a major shipping portfolio overseen by the State Government, for its involvement in the financing of the ship.

 

In Bangladesh, fatal accidents in the shipbreaking industry remain very frequent, a situation that is widely known – but largely ignored – by the shipping industry, insolvency administrators selling off unwanted ships, as well as by the brokers and cash buyers setting up the end-of-life deals. German owners have had at least 32 old ships ramped up on the beaches of Bangladesh this year. With 83 end-of-life vessels sold to beaching yards in South Asia in 2016, German ship owners top the list of global dumpers together with Greek shipping lines. Several end-of-life sales were in direct breach of the European Waste Shipment Regulation that bans the export of hazardous waste to developing countries. The “Viktoria Wulff” was most probably traded through an anonymous cash buyer using the end-of-life flag St Kitts and Nevis before it was beached in Chittagong.

"Only in 2016, at least 19 shipbreaking workers were killed and another 11 severely injured in the Bangladesh yards. The accident rate remains shockingly high and is not coming down, despite the promises of the yard owners and cash buyers. The shipbreaking yards have to be moved away from the muddy beaches to clean and safe ship recycling facilities using quays and docks where cranes can be operated to safely move cut steel sections. Otherwise, the death count of beaching will not come to a halt."
Patrizia Heidegger- Executive Director - NGO Shipbreaking Platform

In an attempt to hide the accident, the yard management kept the body of Shah Jahan inside the premises, but fellow workers and locals rushed to the site and started demonstrating. The body was consequently sent to the morgue of the Chittagong Medical College Hospital. The following day, the worker was quickly buried without a post mortem. Platform member organisations in Bangladesh attended the funeral and now seek to support the victim’s relatives. The family and the yard owners have settled for a one-off payment and a monthly allowance to help them cover their living costs. However, money will not be able to replace Shah Jahan who leaves behind a wife and a young child.

 

Platform News – Maersk incited business partner to opt for worst breaking practices for 14 ships

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A third report by the investigative journalists of Danwatch, “Maersk and the shadowy deals”, reveals that the Danish container ship giant has incentivised the sale of 14 ships to substandard shipbreaking yards on the beaches of Bangladesh and India in 2013/2014. At the same time, Maersk prided itself with a progressive ship recycling policy and its cooperation with state-of-the-art yards in China. The report in Danish was released last week and has created a media uproar in Denmark. The story has been widely featured on TV2, daily newspaper Politiken and other major outlets. It triggered critical reactions from a wide range of stakeholders and forced Maersk to admit that such shady deals should never have been made.

 

Late in 2013, Maersk sought early termination of a charter party for 14 ships due to the vessels’ poor rentability and the general overcapacity in the container ship market. Maersk had previously been the owner of the vessels before they sold them to a finance construct in Germany, MPC Flottenfonds III, in 2009. Maersk then continued operating them based on a long-term charter. In 2014, the Platform investigated that the 14 vessels operated by Maersk had ended up in some of the worst shipbreaking yards in Bangladesh and India, and contacted Jacob Sterling, then Head of Sustainability at Maersk. He said: “We encourage other ship owners to recycle their ships in a responsible way, including those that we charter ships from.” In an article, Sterling also stated: “NGOs argue that beaching must end now. We agree”.

The Cashel/Nedlloyd Asia beached in Bangladesh - © NGO Shipbreaking Platform 2014

Sterling’s response regarding the chartered ships was a lie: a quick look into Maersk’s addendum to the charter contract is enough to understand that. First, Maersk explicitly asked the German owner through a clause in the contract to ensure the immediate demolition of the vessels in order to get them off the market. Second, Maersk demanded in another clause that the vessels had to be sold for the highest price available on the scrap market – without any consideration of environmental or social standards. With the latter clause, Maersk put pressure on the ship fund to sell the 14 vessels for a minimum price of 447 USD per ton, a price that corresponded at the time to the prices offered in South Asian beaching yards. No facility operating under safe and sound conditions would have been able to pay such a high price. Moreover, the contract between Maersk and MPC states that if MPC were to sell the vessels for a lower price, Maersk would have to pay the difference. And, crucially, if MPC managed to sell for a higher price, it was under an obligation to pay Maersk the difference in profit earned. The MPC case is likely not an isolated one. The Platform found that Maersk had sold another three older ships to Greek owner Danaos and immediately chartered them back on a long-term basis. Also these three vessels ended up in beaching yards.

"In 2014, we believed that Maersk was an industry leader with regards to sustainable ship recycling practices. In Maersk’s CSR reports, we could read about their much publicised cooperation with Chinese ship recycling yards, we were shown futuristic videos on ‘total vessel recycling’ and the Head of Sustainability made strong ‘off the beach’ statements. Getting hold of the charter contract opened our eyes to the reality: Maersk actively incentivised business partners to sell to the highest bidder, inevitably offering the lowest standards. Maersk was fully aware that these ships would be broken in some of the worst yards in Bangladesh and India and even had a direct financial interest in that by earning an extra profit."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

After Maersk’s business tactics were revealed in the Danish press, the shipping line has received strong criticism for its unsustainable shipbreaking practices from Danish Parliamentarians, leading Danish environmental organisations, and its own investors.

"Maersk had no other choice but to apologise publicly for both their shady deals and the illegal export of their floating storage and production tanker, the North Sea Producer, from the UK to Bangladesh. Maersk admitted to the media that they should not have made such deals. However, apologies for the worst practices now seem to be the strategy to make the current breaking practice in Alang, India, look like a good solution."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

Danwatch’s investigations at Maersk’s Shree Ram yard in Alang have shown severe shortcomings related to fundamental labour rights, environmental safeguards and basic health and safety standards. Maersk’s support of the beaching yards in Alang stalls any development in India to move ship recycling to modern industrial platforms. Such a transition was already supported by the Government of Gujarat and investors in the 1990s when the Pipavav dry dock was built in order to bring the Indian ship recycling industry to an acceptable level. However, the shipping industry’s profits on the beaches of Alang have consolidated the beaching yards’ monopoly in India, while innovative new businesses from India have been stifled.

"We and other key stakeholders maintain: the future of shipbreaking is not on the beaches of South Asia, but in modern ship recycling facilities. Maersk should lead the way in supporting innovative companies, rather than scotching development in India by supporting a method which is banned in Europe. While India’s space programme is launching satellites for the US and Canada, the shipping industry wants us to believe that Indian companies can dismantle ships only on a beach?"
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

 

NOTES

 

[1] The Platform has sent a letter to the UK Environment Minister on 25 October.

 

[2] In addition to the Danwatch report, see also coverage in Danish TV2 and Politiken.

 

[3] The North Sea Producer was used as an oil and gas floating production storage and offloading (FPSO) vessel in the North Sea at the MacCulloch oil field, 250km north-east of Aberdeen, for ConocoPhillips. When the MacCulloch field was closed, the FPSO was brought to Teesport in Middleborough.

 

[4] Conquistador Shipping Corporation is domiciled at P.O. Box 583, Morton House - Government
Road Charlestown, Nevis. Offshore leaks documentation clearly indicated this is a typical post box company address. See also this link. In order to disguise their involvement in the sale of end-of-life vessels, cash buyers usually use anonymous post box companies, often located in the state whose flag of convenience is used for the last voyage. Similarly, the contracts with the local shipbreaking yard, or papers for the authorities, are signed by local agents so that the name and signature of the cash buyer does not appear on any document.

 

Platform News – Maersk involved in illegal toxic waste trafficking

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Contaminated North Sea oil production and storage tanker ends up on the beach in Bangladesh

 

The Maersk-owned floating oil production and storage tanker, North Sea Producer, left the UK in May 2016 and was directly towed to Bangladesh, where it arrived on 14 August 2016. Two days later, the North Sea Producer was beached at the Janata Steel shipbreaking yard in Chittagong. The vessel is likely to contain large amounts of highly contaminated residues including NORM (natural occurring radioactive material). It is currently being torn apart on a tidal beach, sadly known for the human rights abuses and environmental pollution caused by substandard shipbreaking. The tanker’s export from the UK for demolition in Bangladesh was illegal under the European Waste Shipment Regulation. The NGO Shipbreaking Platform calls on the UK Government to hold the Maersk-owned North Sea Production Company responsible for illegal trafficking in hazardous waste [1].

© TV2

The case has recently been high up on the agenda of Danish media [2], prompting both policy makers and investors of Maersk, including Nordea, and pension funds PFA and KLP, to react. Whilst Maersk claims that they sold the vessel for further operational use, they have so far been unwilling to reveal which company from the oil and gas sector bought the vessel and claimed to be able to operate it. Taking the current market conditions into account, it was highly unlikely that Maersk was able to find a new owner for the North Sea Producer within the oil and gas sector.

 

The North Sea Producer was owned and operated by UK-based North Sea Production Company, a joint venture between Danish Maersk and Brazilian oil & gas company Odebrecht, with 50% ownership each. Having operated in the North Sea as an FPSO [3], the vessel is likely to contain large amounts of residues that are contaminated by NORM and sulphur in addition to the various other hazardous materials in its structure and tanks. The Bangladesh shipbreaking yards are not equipped with any infrastructure that could safely remove and dispose of such toxic wastes. The North Sea Producer was allowed into Bangladesh based on a fake certificate stating that the tanker did not contain any hazardous materials. The import of end-of-life ships containing hazardous waste into Bangladesh is banned, but circumvented with such false documents.

"After the recent revelations on Maersk’s shipbreaking practices in India, we also had to learn that Maersk shamefully exposes workers in Bangladesh to enormous risks. If Maersk sells a contaminated old oil tanker to an anonymous post box company in the Caribbean under the pretense of further operation use, this is at best a total failure of due diligence, if not punishable negligence. We expect the UK authorities to hold all involved companies responsible for illegal hazardous waste trafficking."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

In late April, local newspapers wrote about the sale of the North Sea Producer. The North Sea Production Company was quoted as still being the owner and soon to strike a deal of which the details were confidential. Later, the newspapers stated to have been informed that the FPSO would be reused at the Tin Can Island Port in Nigeria. However, when the ship left Teesport, UK, on 17 May it sailed straight to Bangladesh, with only a few fuel stops for the tug boat Terasea Hawk on its way. Its first stop was in Namibia – way beyond the stated destination in Nigeria.

"It is highly likely that the North Sea Production Company sold the ship directly to cash buyers GMS (Global Marketing Systems), via an anonymous post box company in St. Kitts and Nevis. GMS is one of the world's largest companies that specialises in selling end-of-life tonnage to the beaching yards in South Asia. While GMS has recently been extremely busy in polishing its image with claims of ‘green ship recycling’, the company’s track record – and obvious continued practice – tells another story. GMS continues to strike deals with some of the worst shipbreaking yards in the world, including those in Bangladesh where hazardous waste management capacity is completely absent, where illegal child labour persists, and where workers are killed or maimed in accidents that could have been avoided."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

A Saint Kitts and Nevis-based postbox company, Conquistador Shipping Corporation, [3] became the new registered owner of the ship during its last voyage. Contracts for the vessel with Janata Steel shipbreaking yard were signed with the help of a Chittagong-based agent. It is likely that GMS is behind Conquistador Shipping Corporation which is used for last voyage ship registration. GMS has been involved in similar cases before, such as in 2012 when they used anonymous post box companies in Panama and the end-of-life flag of Belize to illegally export two French ferries, SeaFrance’s Cézanne and Renoir, from France to India.

 

In the coming years a high number of vessels, including semi-submersible platforms, used by the oil and gas sector operating in the North Sea will be decommissioned. Some of these structures have already ended up on the South Asian beaches for breaking under conditions that are both dangerous and polluting.

"We are asking governments to effectively prevent any future illegal waste trafficking as we have seen with the case of the North Sea Producer. The large number of vessels and structures used in the North Sea that will need to be decommissioned in the coming years should prompt public strategies for the creation of jobs in the EU that promise the environmentally sound recovery of valuable resources."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

 

NOTES

 

[1] The Platform has sent a letter to the UK Environment Minister on 25 October.

 

[2] In addition to the Danwatch report, see also coverage in Danish TV2 and Politiken.

 

[3] The North Sea Producer was used as an oil and gas floating production storage and offloading (FPSO) vessel in the North Sea at the MacCulloch oil field, 250km north-east of Aberdeen, for ConocoPhillips. When the MacCulloch field was closed, the FPSO was brought to Teesport in Middleborough.

 

[4] Conquistador Shipping Corporation is domiciled at P.O. Box 583, Morton House - Government
Road Charlestown, Nevis. Offshore leaks documentation clearly indicated this is a typical post box company address. See also this link. In order to disguise their involvement in the sale of end-of-life vessels, cash buyers usually use anonymous post box companies, often located in the state whose flag of convenience is used for the last voyage. Similarly, the contracts with the local shipbreaking yard, or papers for the authorities, are signed by local agents so that the name and signature of the cash buyer does not appear on any document.

 

Platform News – Maersk maintains beaching mantra and chooses to ignore facts revealed by Danwatch

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After investigative journalists have revealed the severe short-comings of Maersk’s shipbreaking practices in Alang, India, the shipping giant blatantly disregards the findings. In an official statement, Maersk defends its new practice of breaking ships on Indian beaches with tooth and nail without even mentioning the grave concerns raised by the Danish journalists [1]. Maersk's strategy seems to be to draw a veil of silence on the bad conditions in Alang whilst trying to squirm themselves out of other scandalous revelations. These include the recent illegal export of their heavily contaminated floating oil production and storage tanker “North Sea Producer” from the UK to Bangladesh and the uncovering of Maersk’s secret contracts that incentivised business partners to sell chartered ships for scrap to the worst yards.

 

After many years of proudly recycling its end-of-life ships in modern ship recycling yards, Maersk now tries to make the world believe that truly sustainable ship recycling off the beach is not affordable. The world’s largest container ship owner comes forward with this misleading statement while its competitor Hapag Lloyd makes it very clear: the German container ship line stays true to its commitment to clean and safe ship recycling off the beach in EU-approved facilities. Also ship owners from other sectors have been doing very well with their uncompromising approach to ship recycling, including Wilhelmsen, Wallenius, Hoegh, Grieg, CSL and Royal Dutch Boskalis.

"Maersk’s cant on their competitiveness is ludicrous: whom do they want to fool when they say that the company would risk its existence if it continued to recycle ships in state-of-the-art facilities? If smaller shipping lines are able to do it, why not the world’s largest ship owner? It is a question of properly accounting for the true costs of recycling throughout the life-cycle of a ship. We expect Maersk to ensure sound financial planning and long-term investments rather than short-term profit maximisation at end-of-life."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

Maersk defends its U-turn from state-of-the-art facilities in China towards the beaches in India with the argument that it will assist the Alang yards to improve their standard. As a matter of fact, Maersk has not invested in any infrastructure in the Alang shipbreaking yards - they have even been warned that such investments might be a dead-end and too costly compared to using available docks or slip-ways. When asked, the company is consequently not able to put a number to its investments in Alang. All that Maersk has done is to write up a standard on paper and to employ staff in Alang to supervise its implementation. The Danwatch investigation has shown that Maersk’s yard, Shree Ram, is unable to live up to that standard and that Maersk’s presence at the yard has not helped to rectify the situation.

"Maersk keeps reeling off its narrative that shipbreaking is a significant employer in India. If workers in India are really their main concern, then why has Maersk not fixed the most basic things first: contracts for all workers, decent accommodation for all, adequate personal protective equipment – before putting its ships on the beach? How can they call shipbreaking ‘superior’ in an area that does not even have a hospital to treat severely injured workers? The truth is: it is all about profit over people."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform
© S Rahman

The NGO Shipbreaking Platform has been calling on Maersk to return to truly sustainable ship recycling and to invest in a model facility off the beach that is able to recycle its estimated 75-100 end-of-life ships under the high standards for environmental protection and occupational health and safety that have been deemed necessary under European law. Only then would Maersk be able to pride itself with supporting decent jobs in the ship recycling sector.

"The answer is not on the beaches of India, Bangladesh and Pakistan. The answer lies in innovation and engineering solutions for 21st century ship recycling: India might be ready, the beaches of Alang are not."
Patrizia Heidegger - Executive Director - NGO Shipbreaking Platform

 

NOTES

 

[1] Four main Maersk claims that Danwatch has proven wrong:

- According to Maersk, its environmental recycling plan foresees that most of the vessel is dismantled without the ship parts being in contact with sand or water. The Platform and other critics have been arguing that the facilities lack large industrial cranes that can be deployed along the side of the ship. Cut sections therefore need to crash down onto the beach and the intertidal zone. During their research at Shree Ram, the journalists found cut sections that had been dropped into the intertidal zone, and were even cut down right on the sand. The claim of ‘no contact between cut parts and sand or water’ remains a myth. Apart from the negative environmental impact of the gravity method, Maersk does not at all address the scraping of toxic paints during the beaching process and the release of heavy metals, such as copper, into the environment.

- Maersk claims that appropriate protective equipment is available and mandatory to use. While the journalists have not checked whether PPEs are available, they have found that adequate protective equipment is simply not used. Workers welding and torch-cutting at Shree Ram were found wearing highly inflammable cotton T-shirt, inadequate or no respiratory protection, no goggles and no hearing protection. The investigations have found that the Maersk supervision on the ground is unable to ensure basic occupational health and safety measures.

- The journalists interviewed ten workers that are employed at Shree Ram. They workers have clearly identified that they work on the demolition of the Maersk Georgia and the Maersk Wyoming. None of them had a contract or any written document concerning their employment relationship. None of the men were aware of their rights. Maersk claims that all Shree Ram workers have contracts and has not been willing to respond to the findings.

- Maersk is aware of the fact that not all of Shree Ram workers are offered decent housing. The shipping giant has accepted this situation when selling the Maersk Wyoming and the Maersk Georgia without demanding basic infrastructure for workers as a precondition for doing business. Similarly, Maersk accepts the lack of a proper hospital at Alang where severe injuries could be treated.