Press Release – NGOs release new report on North Sea oil and gas recycling

The NGO Shipbreaking Platform released today a research report titled “Recycling Outlook: Decommissioning of North Sea Floating Oil & Gas Units” during a seminar held in Oslo, Norway.

 

With the oil and gas sector seeing a downturn since 2014, the Platform has documented an increasing number of offshore units sold for scrap. While the recycling of fixed installations occurs under strict regulations, there are serious concerns regarding the recycling of floating structures, which classify as vessels. Around 200 floating structures have been identified as scrapped globally since 2015 – an estimated 40% of these assets ended up on South Asian beaches, where they were broken up under conditions that cause irreparable damage to the coastal environment and put workers’ lives and health at risk.

 

Numerous  floating platforms and oil and gas structures can be found in the North Sea, where the global oversupply in the rig-market is pushing the oldest assets to be scrapped. There are currently 59 floating mobile drilling rigs in the North Sea, 18 of which were built before 2001. Whilst some of the older units might be converted/upgraded, it is estimated that most of them will be scrapped in the coming years. So far, the only structure which operated in the North Sea and has been traced to a South Asian beaching yard is the FPSO North Sea Producer. There is a real risk, however, that we will see more of these cases coming up in the near future with more decommissioning projects in the North Sea.

 

The NGO Shipbreaking Platform advocates for the use of green recycling capacity already existing in the region. Indeed, North Sea recycling yards have years of experience decommissioning fixed oil and gas structures. There are several dry docks and contained slipway facilities where the dismantling of  floating structures can take place safely and with due regard for labour and environmental concerns. Ehancing the recycling of offshore structures and ships in Europe would furthermore bring opportunities for the many workers that were laid off  after the recession in the oil and gas sector in 2014.

 

The report was published with the support of Norwegian pension fund KLP. KLP promotes, as an essential part of its responsibility, practices of corporate responsibility and responsible investment. As a large investor in Norwegian companies, and companies based outside of Norway operating in the North Sea, it strives to ensure the responsible recycling of ships and offshore assets, aiming at contributing to a shift towards better practices in the sector.

Photos from KLP's seminar "Responsible disposal of ships and rigs" - © Cato Gustavson/KLP

Press Release – Accident on board Greek ship kills two and injures thirteen

Two deaths and thirteen severe injuries. This is the toll of victims following yet another accident at the shipbreaking beach of Chattogram, Bangladesh. The accident occurred in the afternoon of Saturday 31 August at Ziri Subedar shipbreaking yard. 

 

During scrapping operations on the ship CSL VIRGINIA (IMO 9289568) a heavy cable collapsed, hitting several workers at once. Aminul Islam, 35 years old, and Tushar Chakma, 27 years old, lost their lives. Thirteen workers [1] suffered severe injuries and were taken to Chattogram Medical College Hospital for treatment. Following the accident, local authorities ordered the temporary closure of the yard. Investigations are ongoing. 

 

 

So far this year, fifteen shipbreaking workers have lost their lives in Chattogram. It is not the first time Ziri’s failure to ensure safe working conditions causes death. [2] 

"It's sad that our regulatory authorities had to wait for deaths of seven workers and grievous injuries of fifteen in a row of seven incidences in this yard alone since 2011. Had they acted earlier, we could have saved these invaluable lives. The negligent authorities should also be punished as their failures and seeming cohesion have led to these tragic events. I also wonder how long it will take for the West to act on these deaths and stop sending vessels to the unsafe yards of Bangladesh."
Syeda Rizwana Hasan - Chief Executive - Bangladesh Environmental Lawyers Association (BELA)

The container ship CSL VIRGINIA was beached in Bangladesh in February 2019. According to shipping media, it was owned and managed by Andreas Hadjiyiannis’ Greek company Cyprus Sea Lines. The vessel was hit by a Tunisian ferry when it was anchored off Corsica in October 2018. The collision breached the CSL VIRGINIA’s fuel tanks causing a significant oil spill that affected especially the French Mediterranean coast and required a vast clean-up operation. Before setting sail for the Chattogram beach, the vessel was allowed to leave French territorial waters, escorted by the French coast guard, upon claims that it would be repaired in Constanța, Romania. Instead, it spent a few weeks in a Turkish shipyard - there it was renamed VIRGIN STAR and changed registry from the flag of Cyprus to the flag of Liberia. It passed the Suez Canal on 25 December 2018, just days before the entry-into-force of the EU Ship Recycling Regulation.

 

An image of the VIRGIN STAR (first ship from the left) after its arrival in Chattogram - © NGO Shipbreaking Platform

 

NOTES

 

[1] Nasir Uddin (30 years old), Md Sharif (30 years old), Ramdoyal (40 years old), Bimol (25 years old), Dononjoy Tripura (25 years old), Suron Tripura (22 years old), Anik Tripura (20 years old), Srabon (23 years old), Sonjoy (25 years old), Rahi Tripura (22 years old), Jagdish (25 years old), Roton (30 years old), Faruque (35 years old). 

 

[2] On 25 July 2013, Muhammed Selim was severely injured when a heavy iron piece hit and broke his back while working at the yard. The Platform informed the concerned authorities and arranged a meeting between Selim’s wife, accompanied by some of the victim’s fellow workers, and the yard’s management. However, Ziri’s owner did not assist Selim in receiving the necessary treatment for his serious injuries. Selim was brought to his native home in Noakhali, in the Chattogram district, and on 10 November 2014, he died from the injuries he suffered. It was only once the Platform informed Ziri that it would take the matter to the labour court that the yard agreed to pay compensation. Selim’s wife finally received 100.000 Taka (approx. 1000 EUR) on 15 March 2015. 

 

Press Release – Major explosion at Bangladesh shipbreaking yard kills two workers and severely injures five

A loud blast in the early morning shook the Chittagong shipbreaking area. At around 8:30 AM, a fire broke out on board the vessel BUNGA KELANA 4 (IMO 9178343), beached at Mahinur Ship Breaking yard, also known as Premium Trade Corporation. The flames spread from abandoned waste oil located close to the engine room where workers were torch-cutting steel parts. 

 

Mohammod Rubel, 25 years old cutter man, lost his life in the accident. He died on his way to the hospital. Hamidul Islam’s dead body was found on the ship several hours after the explosion. Five other workers, aged 19-30, suffered severe burn injuries and are now being treated at the Chattogram Medical College Hospital. The condition of one of them is extremely critical. Local sources report that several workers might still be missing. 

 

 

Video footage from the accident shows that there was no emergency response equipment available at the yard. Barefoot workers without protective gear are seen carrying the injured. Bangladeshi organisation OSHE, member of the NGO Shipbreaking Platform, reports that the death of a worker, Tara Miya, was covered up in the same yard just a few days ago. 

 

"The conditions at Mahinur Ship Breaking are shocking and unfortunately telling of the overall appalling working conditions at the Bangladeshi shipbreaking yards. Workers are exposed to enormous risks because there is no infrastructure available on the beach to ensure safe working conditions and rapid emergency response."
Ingvild Jenssen - Executive Director and Founder - NGO Shipbreaking Platform

The BUNGA KELANA 4 was beached at Mahinur Ship Breaking six months ago. It was owned by Malaysian shipping company AET Tankers, a wholly owned subsidiary of MISC, the leading Malaysian energy logistics company listed on the Malaysia stock exchange. In 2018, AET Tankers sold four vessels for scrapping on the beaches of South Asia. Three ended up in Bangladesh; one was beached in India. 

 

Before its final voyage the vessel changed its name to KELANA 4, and its Malaysian flag was swapped to that of Comoros. These are clear indicators that the vessel was brought to the beaching yard with the help of a scrap-dealer known as cash buyer. The use of black- and grey-listed flags, such as Comoros, Palau and St Kitts and Nevis, as well as anonymous post-box companies to register the ships, renders it very difficult for authorities to trace and hold ship owners liable for illicit business practices that cause the loss of life, injuries and irreparable damage to the environment.

 

The explosion on the BUNGA KELANA 4 follows another recent tragic event that took place in February, when two workers were killed by a fire on board a tanker owned by Greek Polembros Shipping. In the last ten years, hundreds of workers have lost their lives and suffered severe injuries due to dirty and dangerous shipbreaking practices in Bangladesh. Many more suffer from exposure to toxic fumes and materials that are embedded within the ships’ structures. Breaking apart ships on tidal beaches also causes irreparable damage to the environment. Only yesterday it was revealed that another shipbreaking company, BBC Ship Breaking, had been given the permission by local authorities to wipe out a protected mangrove forest in order to establish a new yard. Following the filing of a complaint by Platform member organisation BELA, the High Court imposed a six months’ stay on the lease contract and have asked the local authorities to explain why they blatantly ignore national forest protection laws. In 2009, 14.000 mangrove trees were illegally cut to expand the shipbreaking activities in Chittagong.

"It is high time for the Bangladesh government to regulate their shipbreaking industry and put a halt to the systematic violations of national labour and environmental protection laws. This latest tragic explosion adds to the shipping industry’s appalling toll on human lives and should act as a wake-up call for the financiers and customers of shipping to demand recycling practices off the beach and in line with the standards set by international waste laws and labour conventions."
Ingvild Jenssen - Executive Director and Founder - NGO Shipbreaking Platform

Press Release – Fire on board Greek tanker kills two shipbreaking workers in Bangladesh

Today, a fire broke out in the engine room on board a tanker, beached in Chittagong, killing two workers. 

 

Md Jamil, 23 years old cutter man, and Bipul lost their lives while scrapping the ship GREEK WARRIOR (IMO 9191412) at Shagorika Ship Breaking Yard. According to local media, Jamil was burned and rushed to Chittagong Medical College Hospital. He died before reaching the hospital. The body of Bipul was discovered on board only few hours later. Shagorika yard and RA Shipbreaking yard, which has been recently under the spotlight for the purchase of Nordic America Tankers’ NORDIC SPRITE, share the same ownership.

 

 

The tanker GREEK WARRIOR was sold to Bangladeshi breakers by Greek company Polembros Shipping in 2018. In the last ten years, Polembros sent at least 24 end-of-life ships to South Asian beaches. Half of them reached the shores of Bangladesh, where unscrupulous shipping companies keep exploiting minimal enforcement of environmental and safety rules to maximise profits. With more than 900 vessels beached since 2009, Greek owners top the list of global dumpers by far.

"It is about time that the Greek government puts an end to the appalling shipbreaking practices of its shipping industry and holds it liable for the irreparable damages caused by beaching. The EU has set a standard that should be followed by Greek ship owners, even when not sailing their vessels under an EU flag."
Ingvild Jenssen - Executive Director and Founder - NGO Shipbreaking Platform

The vessel changed name, from GREEK WARRIOR to S WARRIOR, and flag, from Panama to Palau, before its final voyage. According to maritime databases, the cash buyer involved in the sale was Prayati Shipping Pvt. Ltd, based in Mumbai, India. Prayati Shipping offers different types of services, including demolition voyage management. All vessels sold to the beaching yards pass through the hands of cash buyers. In this way, ship owners attempt to shield themselves from responsibility, and are paid upfront the highest market price in cash for their end-of-life vessels by the dealers. To reduce costs and avoid being held accountable, cash buyers change a vessel’s flag to one of the typical last-voyage flags of convenience, such as Comoros, Palau and St Kitts and Nevis. Cash buyers also register the vessel under a new name and a new post box company, rendering it very difficult for authorities to trace and hold cash buyers and ship owners accountable for illicit business practices.

 

Press Release – Platform publishes list of ships dismantled worldwide in 2018

Record-breaking 90% of end-of-life tonnage scrapped on South Asian beaches

 

According to new data released today by the NGO Shipbreaking Platform, 744 large ocean-going commercial vessels were sold to the scrap yards in 2018. Of these vessels, 518 were broken down on tidal mudflats in Bangladesh, India and Pakistan, amounting to a record-breaking 90,4% of the gross tonnage dismantled globally. 

"The figures of 2018 are shocking. No ship owner can claim to be unaware of the dire conditions at the beaching yards, still they massively continue to sell their vessels to the worst yards to get the highest price for their ships. The harm caused by beaching is real. Workers risk their lives, suffer from exposure to toxics, and coastal ecosystems are devastated. Ship owners have a responsibility to sell to recycling yards that invest in their workers and environment."
Ingvild Jenssen - Executive Director and Founder - NGO Shipbreaking Platform

Last year, at least 35 workers lost their lives when breaking apart the global fleet. The Platform documented at least 14 workers that died in Alang, making 2018 one of one of the worse years for Indian yards in terms of accident records in the last decade. Another 20 workers died and 12 workers were severely injured in the Bangladeshi yards. In Pakistan, local sources confirmed 1 death and 27 injuries. Seven injuries were linked to yet another fire that broke out on-board a beached tanker. 

 


DUMPERS 2018 – Worst practices

 

UNITED ARAB EMIRATES, GREECE and UNITED STATES OF AMERICA top the list of country dumpers in 2018. UAE owners were responsible for the highest absolute number of ships sold to South Asian shipbreaking yards in 2018: there were 61 ships in total. Greek owners, beached 57 vessels out of a total of 66 sold for demolition. American owners closely followed with 53 end-of-life vessels broken up on South Asian tidal mudflats. 

 

The ‘worst corporate dumper’ prize goes to the South Korean liner Sinokor Merchant Marine. The company, which has been loss-making and is about to merge its container operations with Heung-A, sold 11 ships for breaking on the beaches in 2018: eight vessels ended up in Bangladesh and three in India, where in April, during the demolition of Sinokor’s PLATA GLORY at Leela Ship Recycling Yard [1], a worker died hit by a falling iron plate. 

 

Norwegian Nordic American Tankers (NAT) - incorporated in Bermuda and stock-listed in New York - is runner-up for the ‘worst dumper’ prize. Last year, NAT reported having earned USD 80 million for the sale of eight vessels for breaking. Three were sold to Alang for breaking and five were sold to breakers in Chittagong. According to local sources in Bangladesh, the cutting operations of these ships started without required government authorisations. The sale of two additional vessels to yards in Bangladesh with particularly poor track records and where two workers were killed in 2018, prompted Norwegian pension fund KLP to blacklist the company. 

 

Seven vessels were sold to beaching yards for dirty and dangerous scrapping by German owner Dr Peters GmbH & Co KG. According to local sources, fitter Md Samiul lost his life while scrapping Dr Peters’ DS WARRIOR in December 2018.

 

Other known shipping companies that in 2018 sold their vessels for the highest price to the worst breaking yards include: Chevron, Costamare, H-Line, Louis plc, Seabulk, SOVCOMFLOT, Teekay, Zodiac Group and CMB. Belgian CMB is still under investigation for the export of the MINERAL WATER to Bangladesh in 2016.


With the oil and gas sector seeing a downturn in the last couple of years, the Platform has documented an increase in offshore units that have gone for scrap. Out of the 138 oil and gas units which have been identified as demolished in 2018 alone, 96 ended up on the beaches of South Asia. Figures include 81 small-sized tug/supply ships and 33 semi-submersible platforms. Noble Corp, ENSCO, Tidewater, Diamond Offshore and Petrobras are amongst the biggest offshore players that dump their assets on the South Asian beaches. While most assets were exported from either East Asia or America, Diamond Offshore and cash buyer GMS are under investigation in Scotland for having attempted to illegally export three platforms that had operated in the North Sea and were cold-stacked in Cromarty Firth. The platforms have been under arrest in Scotland since January 2018.

 

Ship owners are facing increased pressure from investors and credit providers to stop selling their ships to beaching yards. In early 2018, Scandinavian pension funds KLP and GPFG were the first to divest from four shipping companies due to their beaching practices. Today, banks, pension funds and other financial institutions are actively taking a closer look at how they might contribute to a shift towards better ship recycling practices off the beach, taking into account social and environmental criteria, not just financial returns, when selecting asset values or clients.

 

Losing financing and clients, however, should not be the only concern of ship owners who continue to use dirty and dangerous scrap yards. In 2018, and for the first time ever, a ship owner was held criminally liable for having illegally traded four end-of-life ships to Indian beaching yards. Several other cases of illegal traffic are under investigation. These cases focus not only on the liability of the ship owner, but also on the responsibility of insurers, brokers and maritime warranty surveyors. By unravelling the murky practices of shipbreaking, which involve the use of middle men, or cash buyers, and flags of convenience such as Comoros, Palau and St. Kitts & Nevis, these cases highlight the importance of conducting due diligence when choosing business partners.

"Clean and safe solutions are already available. Responsible ship owners, such as Dutch Boskalis, German Hapag Lloyd, and Scandinavian companies Wallenius-Wilhelmsen and Grieg, recycle their vessels off the beach. The EU maintains a list of clean and safe ship recycling facilities [2]. More ships need to be diverted towards these sites."
Nicola Mulinaris - Communication and Policy Officer - NGO Shipbreaking Platform

For the list of all ships dismantled worldwide in 2018, click here. *

For detailed figures and analysis on ships dismantled in 2018, click here.*

 

* The data gathered by the NGO Shipbreaking Platform is sourced from different outlets and stakeholders, and is cross-checked whenever possible. The data upon which this information is based is correct to the best of the Platform’s knowledge, and the Platform takes no responsibility for the accuracy of the information provided. The Platform will correct or complete data if any inaccuracy is signaled. All data which has been provided is publicly available and does not reveal any confidential business information.

 

 

NOTES

 

[1] The Plata Glory was beached in December 2017 at Leela Ship Recycling yard. Leela holds a so-called Statement of Compliance with the Hong Kong Convention issued by ClassNK and claims to be offering “green recycling”.   

 

[2] The EU has published a list of ship recycling facilities around the world that comply with high standards for environmental protection and workers’ safety. The EU list of approved ship recycling facilities is the first of its kind and an important reference point for sustainable ship recycling. 

 

Press Release – Europe has capacity to recycle its ships, new data shows – yet shipowners want to use dangerous, polluting yards abroad

Ship recycling yards approved by the EU will have enough capacity to handle demand from EU-flagged ships that need to be scrapped, a new analysis shows. The shipping industry wants low-cost ship ‘breaking’ yards outside the EU – with dangerous working conditions and poor environmental standards – to be added to the EU list of approved facilities in order to meet demand from vessels bound by the bloc’s ship recycling law, which enters force on 1 January 2019. But the current EU list can accommodate the numbers and sizes of EU-flagged ships that are scrapped every year, the new report by NGOs Shipbreaking Platform and Transport & Environment (T&E) shows.

 

Damen Verolme Rotterdam ship recycling yard – © DAMEN / Offshore Ship Recycling Rotterdam – OSRR

The 20 EU yards currently recognised as meeting ship-recycling standards have had the capacity to handle all EU ships broken since 2015, the report shows. Shipbreaking Platform and T&E said lawmakers should not succumb to pressure to either delay the implementation of the regulation or add sub-standard shipbreaking facilities – which would never be allowed to operate in EU countries – to the EU list.

 

Yards that use the beaching method are of particular concern. Vessels are full of hazardous materials, including asbestos, chlorine compounds, heavy metals and residue oils. On a tidal mudflat it is not possible to contain these toxics – instead they are washed out to the sea, and ravage coastal ecosystems. Without proper protective equipment, workers are also sickened and exposed to unnecessary risk. Accidents at the beaching yards kill or maim young men each year due to unsafe practices. [1]

 

"The shipowners’ capacity claims are a clear red herring. Alternatives to beaching end-of-life ships exist. It boils down to not accepting the low occupational safety and environmental protection standards that allow many unapproved yards to operate cheaply."
Ingvild Jenssen - Executive Director and Founder - NGO Shipbreaking Platform

Shipowners misleadingly cite the EU yards’ historical capacity to claim that they are over-capacity. However, this does not take into account the EU facilities operating under capacity due to being undercut by sub-standard competition overseas. It also ignores the capacity of newly-opened yards which are just starting to operate.

 

"The business of breaking EU ships is an opportunity to boost circular economy and create green jobs in Europe. EU-listed yards have the capacity to break all EU-flagged ships and more. There is no excuse for sending ships to dangerous and polluting yards on beaches overseas."
Lucy Gilliam- Shipping Officer - T&E

The European Commission, national experts and stakeholders meet on 3 October to discuss the implementation of the regulation.

 

Platform News – Shipping industry presses to undermine European Ship Recycling Regulation

On Monday, the EU member states’ experts on ship recycling met in Brussels to discuss the latest developments, six months ahead of the application of the 2013 Ship Recycling Regulation. With the recent decision by the Chinese government to stop the import of end-of-life ships for scrapping, the shipping industry is quick to lament that there will not be enough recycling capacity and that there will be too few options for them under the EU List of approved recycling facilities. The industry claims that the standard set by the EU must be lowered so that beaching yards can be approved.

 

As much as it is a pity that the Chinese yards who have already made efforts to be included on the List may now no longer be receiving EU-flagged ships for recycling, the Platform has calculated that the facilities which are currently on the List, the 21 EU-based ones only, are in fact sufficient to recycle the entire EU-flagged fleet at end-of-life. [1]

 

Moreover, there are still other facilities outside the EU, as well as those operating in Italy and Norway, which are expected to be included on the List before the application of the Regulation. Indian beaching yards that have applied to be on the EU List will not be included as there is no way for these yards to comply with the requirements of the Regulation as long as ships are beached. The overall capacity and sizes of all the facilities that are compliant with EU law will easily accommodate the recycling needs of EU-flagged ships by 1 January 2019. The scaremongering of the shipping industry therefore needs to be debunked, and the European Commission should not bow-down to the “fake news” spread by the ship owners.

 

SeaEurope, IndustriAll Europe and the Platform have urged that a financial incentive is needed to push more ship owners towards clean and safe ship recycling. French trade Union CGT also recently called upon the French government to support the development of ship recycling capacity in the Mediterranean. With China potentially leaving the international market of ship recycling already next year, there is a clear opportunity for other regions to tailor for clean and safe ship recycling off the beach.

"The EU should aim at ensuring that the European shipping industry no longer causes harm to the environment and workers on the South Asian beaches. 30 percent of end-of-life ships are owned by European companies – compared to only six percent registered under an EU flag. There will be a need to support the expansion of existing or building of new facilities to ensure the clean and safe recycling of the many larger vessels that are owned by European companies. Circular economy is the buzz-word and a return scheme for ships is the solution."
Ingvild Jenssen - Executive Director and Founder - NGO Shipbreaking Platform

 

NOTE

 

[1] The 21 facilities that are currently on the EU List have the capacity to recycle at least 1 mill LDT. Whilst most can only take in smaller vessels, at least 10 of the facilities on the List can take in larger vessels. In 2017, less than 500.000 LDT was registered under an EU flag at end-of-life, out of which 245.827 LDT ended up on the South Asian beaches. All EU-flagged vessels broken last year could have been recycled in facilities that are on the EU List, both in terms of LDT and size. Even when adding also the 423.369 LDT of the 24 ships that swapped their EU flag for a non-EU one few weeks before beaching, the total tonnage does not exceed the capacity of the current EU-listed facilities.

 

Press Release – Seatrade convicted for trafficking toxic ships

Today, the Rotterdam District Court sentenced, on the basis of the EU Waste Shipment Regulation, shipping company Seatrade for the illegal export of vessels sent for scrapping on the beaches of South Asia. The Seatrade company has been heavily fined, and two of its executives have also been banned from exercising the profession as director, commissioner, advisor or employee of a shipping company for one year.

 

For the first time, a European shipping company has been held criminally liable for having sold vessels for scrap to substandard shipbreaking yards in India and Bangladesh, where, as widely acknowledged and according to the Prosecutor, “current ship dismantling methods endanger the lives and health of workers and pollute the environment”. The Prosecutor’s request that the Seatrade executives face prison was only waived in light of this being the first time such criminal charges had been pressed.

 

This groundbreaking judgement sets a European-wide precedent for holding ship owners accountable for knowingly selling vessels, via shady cash-buyers, for dirty and dangerous breaking in order to maximize profits.

"We strongly welcome the judgement of the Rotterdam Court. The ruling sends a clear-cut message that dirty and dangerous scrapping will no longer be tolerated."
Ingvild Jenssen - Executive Director and Founder - NGO Shipbreaking Platform

Press Release – Platform publishes list of ships dismantled worldwide in 2017

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

 

According to new data released today by the NGO Shipbreaking Platform, 835 large ocean-going commercial vessels were sold to the scrap yards in 2017. 543 were broken down – by hand – on the tidal beaches of Bangladesh, India and Pakistan: amounting to 80,3% of all tonnage dismantled globally.

"The figures of 2017 are a sad testimony of the shipping industry’s unwillingness to act responsibly. The reality is that yards with infrastructure fit for the heavy and hazardous industry that ship recycling is, and that can ensure safe working conditions and containment of pollutants, are not being used by ship owners. It is particularly shameful that so many European shipping companies scrap their vessels on beaches. Their obvious lack of interest to ensure that shipbreaking workers around the world enjoy best available technologies, and that the environment is equally protected everywhere, clearly calls for additional pressure from authorities, shipping clients and financers."
Ingvild Jenssen - Executive Director and Founder - NGO Shipbreaking Platform

The negative consequences of shipbreaking are real and felt by many. On the one hand, workers – often exploited migrants and some of them children – lose their life, suffer from injuries caused by fires, falling steel plates and the general unsafe working conditions, as well as from occupational diseases due to exposure to toxic fumes and materials. On the other hand, coastal ecosystems, and the local communities depending on them, are devastated by toxic spills and various pollutants leaking into the environment as a result of breaking vessels on beaches.

 

Despite the terrible accident that shook the international shipbreaking community in 2016, no lesson has been learned in Pakistan. In 2017, at least 10 workers lost their lives at the shipbreaking yards on the beach of Gadani. The Platform documented 15 deaths in the Bangladeshi yards last year, where also at least another 22 workers were seriously injured. Whilst international and local NGOs were repeatedly denied access to the Indian shipbreaking yards, the Platform was informed of at least eight fatal accidents in Alang in 2017.

 


DUMPERS 2017 - Worst practices

 

As in 2016, GERMANY and GREECE top the list of country dumpers in 2017. German owners, including banks and ship funds, beached 50 vessels out of a total of 53 sold for demolition. Greek owners were responsible for the highest absolute number of ships sold to South Asian shipbreaking yards in 2017: 51 ships in total. Since the Platform’s first compilation of data in 2009, Greek shipping companies have unceasingly topped the list of owners that opt for dirty and dangerous shipbreaking.

 

Despite increased pressure for safe and clean ship recycling from Norwegian investors and authorities, in 2017, the number of Norwegian-owned ships scrapped on the beach was on the rise: 16 ended up in Alang, Gadani and Chittagong. The attempted illegal export of the TIDE CARRIER to Pakistan was stopped by Norwegian authorities following an alert by the Platform.

 

In light of increased pressure from Scandinavian banks and investors, including Norwegian pension funds KLP and NBIM, and ongoing criminal investigations against the owners of TIDE CARRIER, Norwegian ship owners will have to ask themselves whether dirty profits are worth the reputational and financial risk that using beaching facilities now entails. Also, Danish container-giant Maersk will have an increasingly hard time justifying its U-turn back to the beach in Alang, as the yards there will not make it on the EU list of approved ship recycling facilities [1]”, comments Ingvild Jenssen.

 

The worst corporate dumper prize goes to Continental Investment Holdings (CIH), the Singapore-headquartered shipowning arm of Myanmar shipowner Captain U Ko Ko Htoo and parent company of Continental Shipping Line. The company, which is currently changing the composition of its fleet, sold 9 ships for breaking on the beaches in 2017. Four vessels ended up in Bangladesh, where in late December, during the demolition of CIH’s TAUNG GYI STAR, a worker died hit by a falling iron plate.

 

Ranked at second place, the container shipping giant Mediterranean Shipping Company (MSC) sold 7 vessels to Indian breakers. In the last nine years, MSC has profited from the sale of more than seventy ships for dirty and dangerous scrapping in Alang.

 

The Japanese owner Mitsui OSK Lines and the UK-based Zodiac Group follow closely with respectively 6 and 5 ships sold to South Asian yards. Zodiac received the worst dumper award in 2016 and sold 4 vessels to the yards in Chittagong despite being under scrutiny after a Bangladeshi worker sought compensation from the company for injuries incurred when breaking the EURUS LONDON.

 

Other known companies that in 2017 opted for substandard yards, rather than recycling their ships in a safe and clean manner, include: Hanjin Shipping, Hansa Mare Reederei, Peter Dohle Schiffahrts, Rickmers Reederei, Hansa Treuhand, Berge Bulk, Costamare, Quantum Pacific Group and Teekay. Teekay had promised to never sell to beaching yards again after a worker died breaking the ASPIRE in 2014 in Chittagong. That Berge Bulk was under the spotlight in December 2016, when it was feared that the Berge Stahl would end up on a beach, did not prevent the company from selling another 5 ships for dirty and dangerous breaking in 2017.


 

With the oil and gas sector seeing a downturn in the last couple of years, the Platform has documented an increase in offshore units that have gone for scrap. Out of the 91 units which have been identified as demolished in the last three years combined, 41 of them ended up on the beaches of South Asia after being towed for thousands of kilometers across the globe. Three floating platforms cold-stacked in Scotland that were sold by Diamond Offshore for scrap in 2017, allegedly to cash buyer GMS, were stopped from leaving following an alert by the Platform on their highly likely illegal export. “Fixed platforms cannot easily escape decommissioning rules, whereas we have seen that nearly half of all floating units slip under the radar and end up on beaches – this double standard has to stop”, states Francesca Carlsson, Corporate Liaison and Policy Officer of the NGO Shipbreaking Platform.

 

All vessels sold to the beaching yards pass through the hands of scrap dealers known as cash buyers. In this way, ship owners attempt to shield themselves from responsibility, and are paid upfront the highest market price in cash for their end-of-life vessels by the dealers. To reduce costs and to exploit the loopholes in international legislation, cash buyers will change a vessel’s flag to one of the typical last-voyage flags of convenience, such as Comoros, Palau and St Kitts and Nevis. Cash buyers will also register the vessel under a new name and a new post box company, rendering it very difficult for authorities to trace and hold cash buyers and ship owners accountable for illicit business practices.

"Ship-owning companies that stand by their corporate social responsibility directly sign contracts with ship recycling facilities they have inspected and found adequate. Choosing to sell a ship to a facility which is on the EU list of approved yards is the easiest way for a ship owner to be assured that there has been a quality check. Fortunately, it is becoming increasingly difficult for ship owners to simply blame the cash buyer: investors and authorities are expecting ship owners to control the choice of the recycling yard, and expect that choice to be a yard that does not endanger workers and the environment [2]."
Francesca Carlsson - Corporate Liaison and Policy Officer - NGO Shipbreaking Platform

For the list of all ships dismantled worldwide in 2017, click here.*/**
For detailed figures and analysis on ships dismantled in 2017, click here.*

 

* The data gathered by the NGO Shipbreaking Platform is sourced from different outlets and stakeholders, and is cross-checked whenever possible. The data upon which this information is based is correct to the best of the Platform’s knowledge, and the Platform takes no responsibility for the accuracy of the information provided. The Platform will correct or complete data if any inaccuracy is signaled. All data which has been provided is publicly available and does not reveal any confidential business information.

 

**[UPDATE 22 February 2018 - Norwegian Tschudi Shipping Company AS informed us that two ships the company owned, the Hurricane I and the Hurricane II, had been sold to a buyer for continued operation in August 2016, one year before they ended up on South Asian beaches. Indeed, the buyer was the Indian registered company Hermes Maritime Services Pvt Ltd, which in 2017 purchased and sold several ships for breaking. Further research revealed that Hermes Maritime Services Pvt Ltd also buys tugboats near the end of their operational lives and manages these to tow vessels to the beaching yards, as was the case for the Hurricane vessels. The Platform has therefore updated the data and changed the ownership of these two vessels to the Indian-based Hermes Maritime Services Pvt]
[UPDATE 23 February 2018 - Italian K-Ships Srl informed us that one ship the company managed, the F1, had been sold to a buyer for continued operation in November 2013, four years before it ended up on a South Asian beach. The documentation provided by K-Ships shows that the Italian company is not linked to the end-of-life sale of the F1. The Platform has therefore rectified the data concerning the beneficial ownership of the vessel]

 

 

NOTES

 

[1] In 2018, 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.

 

[2] 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.

 

Press Release – Dutch prosecutors press criminal charges against Seatrade

Managers risk prison sentences and hefty fines for the illegal sale of end-of-life ships

 


CORRECTION

 

Brussels, 15 February 2018 – Following discussions with the Dutch Public Prosecutor, cash buyer GMS was not confirmed to be the end-buyer of the Seatrade’s vessels. Evidence provided to the Court showed that GMS had made an offer for at least one of the ships, which supports the Prosecutor’s case on Seatrade’s intent to dispose of the vessel(s).


 

For the first time in Europe, Public Prosecutors are bringing criminal charges against a ship owner – Seatrade – for having sold vessels to scrap yards in countries “where current ship dismantling methods endanger the lives and health of workers and pollute the environment”. The case is being heard in a Rotterdam Court this week, and the Dutch Public Prosecutor calls for a hefty fine (2.55 mill EUR) and confiscation of the profits Seatrade made on the illegal sale of four ships, as well as a six month prison sentence for three of Seatrade’s top executives. Seatrade is based in Groningen, the Netherlands, and is the largest reefer operator in the world.

 

In 2013, the NGO Shipbreaking Platform had revealed Seatrade’s sale of the SPRING BEAR and SPRING BOB to respectively Indian and Bangladeshi breakers. The heavy charges pressed by the Dutch Prosecutor additionally involve the scrapping of the SPRING PANDA and SPRING DELI in Turkey, and are based on international laws governing the export of hazardous waste and the EU Waste Shipment Regulation. The Regulation prohibits EU Member States from exporting hazardous waste [1] to countries outside the OECD, as well as requiring a prior informed consent for such exports. All four vessels departed on their last voyage to the breaking yards from the ports of Rotterdam and Hamburg in the spring of 2012.

 

[The Prosecutor presented evidence that Seatrade was planning on selling the ships via a cash-buyer in order to maximize financial gain. In e-mail exchanges between Seatrade and Baltic Union Shipbrokers, cash buyer GMS offered the highest price for special parts of at least one of the vessels. The end-sale was not to GMS, but another undisclosed cash buyer.] According to the Prosecutor, Seatrade opted for using a cash buyer, rather than recycling the ships in a safe and clean manner, for purely financial reasons. [Cash buyers, such as GMS, are] infamous scrap-dealers specialized in bringing ships to the beaches of South Asia, where the price of end-of-life vessels is higher due to the exploitation of migrant laborers and to weak, or no, enforcement of safety and environmental standards. According to the Prosecutor, that Seatrade knowingly sold the vessels for dirty and dangerous breaking in order to maximize profits further aggravates the charge [2].

 

Despite ongoing criminal investigations, Seatrade sold two more ships – the SINA and ELLAN – for dirty and dangerous breaking on the beach in Alang, India, in August 2017”, says Ingvild Jenssen, Founder and Director of the NGO Shipbreaking Platform. “This case adds itself to the growing demand, including from investors and major shipping banks, for better ship recycling practices”, she adds.

 

Authorities in Norway, Belgium, and the UK will be paying close attention to the verdict of the case. Similar cases are currently being investigated there, involving shipping companies such as Maersk and CMB, as well as the world’s largest cash-buyers GMS and Wirana.

 

 

NOTES

 

[1] Ships contain many substances that are toxic within their structure, including asbestos, heavy metals and residue oils. Since Seatrade specializes in transporting refrigerated goods, all the vessels additionally contained chlorofluorocarbon (CFCs), a substance which is known to cause ozone depletion in the upper atmosphere. The Montreal Protocol (on Substances that Deplete the Ozone Layer), which entered into force in 1989, has since its adoption phased out and prohibited the use of CFCs.

 

[2] Earlier this year the world largest private investor, the Norwegian Oil Pension Fund, divested from four shipping companies due to their poor shipbreaking practices. They also argued that selling a vessel to a beaching yard “is a consequence of an active choice on the part of the company that owned the vessel to maximise its profit”.