LNG ship-to-ship transfer resumes in Subic, but ship crew won’t disembark

 

Ship-to-ship transfer operations of liquefied natural gas (LNG) has resumed in Subic Bay with the arrival here of a tanker over the weekend, but the Subic Bay Metropolitan Authority (SBMA) said the ship crew won’t be allowed to disembark due to health protocols observed in this time of the Covid-19 pandemic.

SBMA Chairman and Administrator Wilma T. Eisma said the agency has made it clear that the officers and crew of LNG/C Methane Shirley Elisabeth, a tanker that will transfer her LNG cargo to smaller feeder ships, would remain on board all throughout the two-week operation. 

“No one from the ship can be allowed to come ashore, sadly not even the 16 Filipinos among the 31 crew members, because of the health measures we must observe,” Eisma said.

The same policy will be implemented for the crew members of feeder vessels that will transport the LNG cargo from LNG/C Methane Shirley Elisabeth to ports in China, she added.

Eisma described the resumption of LNG ship-to-ship (STS) transfer operations in Subic as a “welcome boost to the economy” but stressed that health safety should be a paramount concern for both ship and port personnel.

According to SBMA seaport manager Jerome Martinez, LNG/C Methane Shirley Elisabeth, which has a gross tonnage of 95,753 tons, has a carrying capacity of 142,800 cubic meters of liquid gas.

He said the Bermudan-flagged carrier originated from Qatar and dropped by at a Hong Kong port to pick up three mooring masters before proceeding to Subic.

The ship is expected to stay at anchor here until August 15 for STS operations.

Martinez also confirmed that no one among the crew would be allowed to disembark from the ship for any reason while it is in the Port of Subic.

He said that aside from the 16 Filipino crewmen, 15 other foreign nationals are on board the vessel. These include nine Greeks, two Croatians, two Ukrainians, a Romanian, and a Latvian.

Martinez also noted that upon arrival at the anchorage area outside of the bay, a team from the Bureau of Quarantine (BOQ) immediately boarded the tanker for health inspections and safety protocols, and followed by a boarding party composed of personnel from the Bureau of Customs (BoC) and Bureau of Immigration (BoI).

Following LNG/C Methane Shirley Elisabeth, another LNG carrier, the Singaporean-flagged LNG/C Lerici, will also conduct ship-to-ship (STS) transfer in Subic.

Eisma said the same health and safety protocols will be imposed by Subic authorities for Lerici’s STS operation. (MPD-SBMA)

PHOTO:  

The LNG carrier Methane Shirley Elisabeth

Read More

Subic fishers dispute ‘alarmist’ yarn on LNG operations

Local fishermen have disputed claims by leaders of some activist groups in Central Luzon that the ship-to-ship transfer (STS) operations of liquefied natural gas (LNG) on Subic Bay endanger fisher folk in the area and that locals were not consulted about the project before its approval by the Subic Bay Metropolitan Authority (SBMA).

Resty del Rosario and Laureano Artagame, both officials of local Fisheries and Aquatic Resources Management Councils (FARMC), dismissed the claims and pointed out that the negative reports came from personalities who do not represent the legitimate concerns of fishermen from Subic Bay.

The news item came out in the alternative news website Kodao and quoted Pamalakaya Central Luzon coordinator Alberto Roldan as saying that STS operations for LNG in Subic “endanger fisher folk as well as civilian establishments and communities in Olongapo City.” Pamalakaya stands for the Pambansang Lakas ng Kilusang Mamamalakaya, which is the national federation of fishermen’s organizations.

The report also quoted Marcelito Clemente, coordinator of the Central Luzon Alliance for a Sovereign Philippines (CLASP), as saying that the project was “simply another case of profit above public safety for SBMA.” CLASP, a left-leaning group, had called for the withdrawal of U.S. military bases in the country and had opposed the holding of Balikatan military exercises with American armed forces.

The local fisher folk leaders, however, said the reports do not mirror the sentiments of local fishermen.

“We support the SBMA on this project 100 percent,” said Del Rosario, who chairs the Subic Bay Integrated Fisheries and Aquatic Resources Management Council, which whose members include fisher folk in Olongapo City, Subic and San Antonio, Zambales and Morong, Bataan.

“Is the LNG operation safe? We believe so, because the SBMA wouldn’t place that project there without examining and addressing the risks involved,” Del Rosario added.

He noted that the critics of the STS project are far too removed from the area, and hence are unaware of the local situation.

“How would they know what happens down here? How can they be the voice of the locals? They are just being alarmists,” an exasperated Del Rosario said.

“As local leaders representing the mostly poor and marginalized fishermen in the locality, we will not be a party to anything that will harm our people. We will not agree to it,” Del Rosario added.

Artagame, meanwhile, emphasized that the SBMA has not been remiss in consulting local fishermen about the LNG project during its inception in 2016. He recalled that the Jovo Group, China’s leading clean energy service provider which operates the project, conducted a consultation in October last year before making the first ship-to-ship transfer in April this year.

“We were invited during the consultation and it was amply shown to us that the LNG is clean and safe,” Artagame said. “Of course, we gave our suggestions regarding the operation, and the SBMA officials assured us that they will stop the operation if ever there will be any harmful effect. By the grace of God, no such effect had ever come our way since then,” he added.

Aside from the perceived safety of STS operations here, Del Rosario also pointed out that the area where the transfer is being handled is no longer a part of the community fishing grounds ever since the US Navy had used Subic Bay as a military base.

“We are fishing elsewhere, a little farther from the location of the LNG and even father out of the bay, and the SBMA is even helping us restore coral reefs that have been damaged over the years by illegal fishing,” Artagame said.

Ever since the LNG project was approved, only two transfers have been made: the first was made on April 27 and the second on November 19. (HEE/MPD-SBMA)

PHOTOS:

[1 ]Laureano Artagame, Provincial Chairman of FARMC Zambales and Vice-Chairman of FARMC of the Municipality of Subic.

[2] 3The first LNG ship-to-ship transfer operations on Subic Bay made last April.

Read More

China’s JOVO starts LNG ship-to-ship transfer in Subic Freeport

The country’s first ship-to-ship (STS) transfer operations for liquefied natural gas (LNG) by China’s Jovo Group Company Ltd. Guandong (JOVO) started operations here Thursday (April 27), the first major investment in the Freeport under the Duterte Administration.

The 105,335-ton Malaysian-flagged Seri Bakti, which arrived from Australia, is now anchored in Subic Bay and has just completed transferring an initial load of LNG to feeder vessel S/S Polar Spirit, a 72,524-ton Bahamas-flagged vessel.

S/S Seri Bakti skippered by Capt. Sydney De Silveira, is operated by MISC group, a leading provider of energy-related maritime solutions and services.

On the other hand, Polar Spirit is operated by Teekay Gas Service and is under the command of Capt. Nenad Bezic.

Subic Bay Metropolitan Authority (SBMA) Administrator Wilma Amy Eisma said Seri Bakti is among the largest gas carriers operating for maritime transport.

“Because of the depth of our port, Subic Bay could accommodate this gigantic vessel, or any other super-size ship for that matter,” Eisma explained.

The ship-to-ship transfer operations involves a large mother vessel loaded with LNG and anchored off-shore, and smaller vessels that will bring the cargo to ports of destination where bigger ships are not allowed to anchor due to maritime issues.

Eisma said Seri Bakti’s operations in Subic Bay involves an initial minimum of two transfers per month and will increase to a maximum of six transfers per month by the third quarter of the year at the earliest.

In terms of revenue, it is expected that the Port of Subic will earn from this project tens of millions of pesos from services, including tug boat services, port services and anchorage, chandlers, bunkering and food supplies.

According to SBMA Seaport general manager Jerome Martinez, Seri Bakti will discharge LNG on two separate occasions to S/S Polar Spirit.

Martinez also stressed that the STS transfer operations will be safe as LNG has less greenhouse effect and is not highly combustible like gasoline or liquefied petroleum gas.

“It burns slowly, and does not mix with water nor kill fish or any other marine life. LNG is very environmental friendly,” he said.

“And in case that it is accidentally mixed with water, LNG will immediately evaporate without affecting the chemical property of the water, which will remain safe for aquatic life or even for drinking,” he added.

Aside from JOVO, the SBMA Board of Directors has already approved three more ship-to-ship service providers to operate in Subic Bay.

“JOVO is the only privately-owned gas company in China and is one of the leading clean energy service providers in the world,”JOVO manager Chris Huang said.

Earlier, JOVO International business general manager Yuan Lu said the firm’s STS operation in Subic may lead to the establishment of an LNG regional hub here to accommodate the delivery of LNG to local market and the rest of Southeast Asia.

He added that JOVO’s long-term plan is to introduce the LNG to the Philippine market, especially those in transportation sector that use trucks, haulers and school buses that prioritize safety and clean environment.

Lu also gave the assurance that JOVO has decades of comprehensive experience in clean energy shipping, storage, processing, and sales without accident and assured that its LNG STS operation will be environmentally safe. (RAV/RBB/HEE/MPD-SBMA)

PHOTOS:

[1] The 105,335-ton Malaysian-flagged Seri Bakti (right) is flanked by S/S Polar Spirit over the waters of Subic Bay as it transfers thousands of cubic meters of liquefied natural gas (LNG) to the feeder vessel. (AMD/MPD-SBMA)

[2] Aerial of S/S/ Seri Bakti and S/S Solar Spirit over the waters of Subic Bay.

[3] Officials of the Subic Bay Metropolitan Authority (SBMA) led by Administrator Wilma Amy Eisma (center) and officers of S/S Seri Bakti on board the Malaysian LNG tanker.

Read More

China’s JOVO prepares ship-to-ship cargo handling in Subic Bay

All is set for China’s leading clean energy service provider JOVO Group Company Ltd. Guangdong to commence its ship-to-ship (STS) operations here for liquefied natural gas (LNG).

The STS transfer operations involve mother vessels loaded with LNG which were transferred to vessels before shipping to ports of China.

A petroleum carrier that transports Liquefied Petroleum Gas (LNG) through ship-to-ship transfer

Subic Bay Metropolitan Authority (SBMA) administrator Atty. Wilma Eisma said that the SBMA Board of Directors recently approved the STS operations of JOVO in Subic Bay and preparations for the maiden voyage tentatively scheduled on the third week of April is in the progress.

“We are expecting more STS operators to use Subic Bay as their hub. Because it is more cost-effective due to its strategic location,” Eisma said.

SBMA Seaport General Manager Jerome Martinez said JOVO will bring LNG to the Philippines from Australia and Indonesia using a 94,000-ton mother vessel. While anchored, it will be transferred to smaller 47,000-tonnage feeder vessels and bring them to China.

In terms of revenue, it is expected that the Port of Subic will earn $500,000 from services, including tug boat services, port services and anchorage, chandlers, bunkering and food supplies.

Aside from JOVO, Martinez said that three more ship-to-ship service providers have expressed keen interest to operate in Subic Bay.

“There are actually four proponents of ship-to-ship operations that submitted letters of intent to operate here in Subic Bay,” Martinez said.

“They already presented their proposals to a committee, headed by SBMA director Cecille Bitare, which evaluates STS proposals prior to approval of the board,” Martinez added. (RAV/MPD-SBMA)


Read also: China’s Jovo to start ship-to-ship cargo handling in Subic

Read More

China’s Jovo to start ship-to-ship cargo handling in Subic

China’s leading clean energy service provider Jovo Group Company Ltd. Guangdong (Jovo) on Wednesday said it is ready to engage in ship-to-ship operations in Subic Bay.

The ship-to-ship (STS) transfer operations will involve oil tankers carrying liquefied natural gas (LNG) from Asia Pacific that will be transferred to smaller vessels bound to ports in China. STS addresses the shipping of petroleum products to China as most of its ports cannot accommodate bulk carriers because of depth issues.

A petroleum carrier that transports LNG through ship-to-ship (STS) transfer

In a public consultation, Jovo International Business general manager Yuan Lu said the LNG will be brought to Subic Bay from Australia and Indonesia by Belgium-flag carrier, a 94,000-ton bulk carrier. The cargo will then be transferred while at sea to a smaller 47,000-tonnage capacity ship bound for China.

Lu said that the STS operations of Jovo in Subic will be assessed after five years, results of which will determine if a regional hub should be established here to accommodate delivery of LNG to the local market and the rest of Southeast Asia.

He said Jovo’s long-term plan is to introduce the LNG to local markets in the Philippines, especially those in the transportation sector as this kind of fuel is safe and environmentally friendly.

Lu said that company Jovo has decades of comprehensive experience in clean energy shipping, storage, processing and sales with zero accidents, and assured that LNG and the STS operation will be environmentally safe.

The consultation was attended by local fishermen, members of the Philippine Coast Guard, PNP Maritime Group and workers of Subic Bay Metropolitan Authority (SBMA) held at the SBMA Seaport Admin Building.

Fishermen belonging to Subic Bay Fisheries and Aquatic Resource Management Council (SBFARMC) said they are grateful to SBMA and Jovo for the holding of the consultations prior to the start of the STS operation in Subic.

“We are thankful for the invitation of SBMA headed by its new chairman Martin Diño and Jovo for this consultation for them to hear our concerns and enlighten us on this ship-to-ship operation that might affect our livelihood,” said SBFARMC chair Laureano Artagame.

Artagame noted that large ships oftentimes occupy the fishing areas of small fishermen in Subic Bay, but with the consultation, accidental “intrusion” can now be avoided.

Meanwhile, China Classification Society (CCS) senior engineer Fan Hong Jun, in his presentation, compared highly combustible gasoline or liquefied petroleum gas against LNG which has lesser greenhouse effect and is lighter than air, making it safer in case of spillage.

With a property temperature of -162 ̊C, LNG is hard to burn but evaporates rapidly, Fan explained, adding that if it spills into our oceans or even into our water source, it will not affect marine life, and our water remains safe to drink.

“It burns slowly, and does not mix with water nor kill fish or any other marine life. LNG is very environmental friendly,” he said.

In terms of revenue, Fan said the Port of Subic will earn tens of millions of pesos from services, including tug boat services, port services and anchorage. This does not include indirect revenue from payments for tugboats, chandlers, bunkering and food supplies. (RAV/MPD-SBMA)

Read More

Fendercare Marine to start Subic Bay operations

Fendercare Marine, one of the world’s biggest ship-to-ship (STS) cargo transfer service providers, is opening its services in Southeast Asia by bringing its operation to Subic Bay.

Subic Bay Metropolitan Authority (SBMA) Chairman Roberto Garcia said that among the investment projects approved by the SBMA board of directors recently was Fendercare’s proposal for ship-to-ship transfer of liquefied natural gas (LNG).

A world leader in ship-to-ship transfers, Fendercare operates from a global network of over 50 bases

The operations, Garcia said, will generate a minimum of P50 million a year in terms of port use only. This does not include indirect fees like payment for tugboats, chandlers, bunkering, and food supplies, Garcia added.

Jerome Martinez, manager of the SBMA Seaport Department, said the company is planning to start its operation in Subic Bay in the last week of September this year.

In connection with this, he said that Fendercare Marine business development manager William Barker and the company's Asia Pacific commercial manager Capt. George Mills recently conducted an orientation for Subic stakeholders to answer queries and concerns related to the their operations in Subic Bay.

“It is because of the location, the logistics available, and the assistance that the company is receiving from SBMA that Fendercare Marine has chosen Subic as the location for its operation in Asia,” Barker said during the briefings.

Barker noted that the operation would initially involve two ships: MV LNG Excel, a mother ship anchored at Subic Bay and loaded with LNG from Australia, which it would feed to MV LNG Lerici, a daughter ship, which in turn would deliver the cargo to Asian destinations, especially China.

The same officials also briefed fisherfolk in the coastal communities of Subic, Zambales, and Olongapo City on the project.

In the said briefings, Fendercare representatives also allayed fears of adverse environmental impact, saying that LNG is a very safe form of fuel that is why it is widely used in Japan where one shipload of LNG is said to be unloaded every 20 hours.

“It burns slowly, evaporates rapidly, and does not mix with water or kill fish or any other marine life. LNG is very environmental-friendly,” company officials said.

Fendercare Marine, which is a part of James Fisher and Sons plc, has been awarded a certificate of excellence for STS operations throughout 2015 for its exemplary safety record without any environmental accident since it began STS services in 2013, involving LNG transfer.

The company has provided ship-to-ship services to the oil and shipping industries globally since 1995. Today these services are provided from a global network of 50 bases, currently handling in excess of 2,800 transfers a year, the company website said. (RAV/MPD-SBMA)

Read More

Biggest Ore Carrier Calls In Subic

Vale SA, the iron ore producer operating the world's biggest ships, said one of them called at the port of Subic in the Philippines, extending the number receiving the vessels to seven.

The Vale Minas Gerais, with capacity to carry 400,000 metric tons of iron ore, arrived at Villaneuva port yesterday, Vale said in an e-mail today. The company is spending more than $8 billion to build and control a fleet of 35 of the carriers to lower its freight costs and better compete with Australian miners, who are closer to the biggest consuming region.

China buys about 65 percent of the world’s seaborne iron ore. Vale said in June its biggest ships were restricted from calling at the Asian country’s ports. The vessels already called at ports in Brazil, Oman, the Netherlands, Japan and Italy, the miner said today.

They have also discharged at a floating transfer station at Subic Bay in the Philippines.

JFE Steel Corp. took delivery of the cargo, the fourth steelmaker to do so from one of the so-called Valemaxes, according to Vale.

The ships are lowering transport costs for steelmakers in Asia with “advanced” negotiations with other customers and ports to use

them, Vale’s Executive Director for Ferrous and Strategy Jose Carlos Martins said in the statement.

Vale paid $4.20 a ton to hire a vessel to ship ore to China from Subic Bay, according to an Oct. 11 list of charters published by the Baltic Exchange, the London-based assessor of freight costs.

Vale declined to comment on that charter in an emailed response to questions on Oct. 16.

Rates for Capesize vessels carrying the commodity slid 1.7 percent today to $13,430 a day, according to the Baltic Exchange. The ships have less than 50 percent of the capacity of Valemaxes. Panamaxes, the biggest to navigate the Panama Canal’s locks, fell 1 percent to $7,142 a day.

Costs as measured by the Baltic Dry Index, a wider measure of raw materials freight rates, declined 1 percent to 989 points. (Bloomberg)

Read More

Vale, SBMA launch Subic Bay iron ore transshipment operations

Brazil’s Vale Shipping Holdings Pte. Ltd. (VSH), along with the Subic Bay Metropolitan Authority (SBMA), formally launched a partnership for the transshipment of iron ore from this free port.

In a ceremony held at the Lighthouse Marina Resort here on June 1, VSH executives led by Jose Carlos Martins, executive officer for ferrous minerals operations, and officials of the SBMA led by Chairman and Administrator Roberto Garcia, announced the start of Vale’s transshipment business here.

VSH is an affiliate of Vale SA, the world’s largest producer of iron ore, which also controls the largest share of the seaborne market for iron ore.

The company will carry out iron ore transshipment operations from its Valemax mother vessel to be anchored in Subic Bay, and then supply ore to smaller daughter vessels or feeders, which are either Panamax or Capesize types.

The project is expected to boost Subic’s port revenues by up to P70 million in the first year of operations alone.

In his message during the project launch, Martins thanked the SBMA for its warm reception of the project and expressed hope that the partnership between his company and the SBMA would continue to grow and benefit both the Philippines and Brazil.

“The Philippines is growing now at almost the same pace with China, and the Philippines is emerging in the world economy,” Martins noted. “With this opportunity, now is our time — now is the time for countries like Brazil and the Philippines.”

Garcia, meanwhile, said that the Vale project will help thrust the Philippines forward in the maritime industry and stressed its importance to the SBMA.

“In our strategic plan, we were very dead-set in continuing to promote the maritime business, and the Vale project is an important pillar of our strategy to maximize the use of Subic Bay,” he said.

“We have a very good future here,” Garcia added, pointing out that the Philippines is in a current state of rapid development, having achieved a 6.4 per cent GDP growth rate this first quarter compared to 4 per cent last year. “And what is outstanding is the fact that it is the second highest growth rate in the region, second only to China,” he added.

For his part, SBMA director and treasurer Joven Reyes said that the agency is much honored that VSH had chosen Subic Bay as its major transshipment port.

“We hope even more that your business continues to move from success to success and that this partnership, which we are officially launching today, would lead to better and greater developments for Vale, Subic Bay, and of course our country down the road,” Reyes said.

The Vale project began in late 2010 when SBMA and Vale proposed a solution that matched Vale’s transshipment operations model with SBMA’s logistics business model.

Stefani Saño, SBMA senior deputy administrator for business and investment development, said that Vale needed to optimize its large-scale iron ore distribution and delivery system and the SBMA offered the bay as a suitable offshore location.

“This logistics model would allow Vale’s huge vessels to tranship the commodity with maximum efficiency in terms of time and cost, given the scale of operations required,” Saño added.

Saño also said that apart from Vale, the SBMA is also trying to attract more logistics companies to invest in the Freeport. He said that at least two logistics companies engaged in different line of commodities for offshore-based distribution operations have expressed interest in locating at Subic Bay. (FMD/MPD-SBMA)

PHOTO:
SBMA Chairman Roberto V. Garcia welcomes Jose Carlos Martins, executive officer for ferrous minerals operations of the Vale Shipping Holdings Pte. Ltd. ( VSH), during the June 1 ceremonial launch of the Vale iron ore transshipment operations in Subic Bay. Looking on, at left, is SBMA chief operating officer Joven Reyes.

Read More

Brazil's Vale offers spot iron ore from Subic Bay, Philippines

SINGAPORE - Brazilian miner Vale has offered spot iron ore for tender Monday, sailing from its Floating Transfer Station at Subic Bay, Philippines, market participants said Monday.

Previously, most of Vale's spot offers have been for cargoes loaded on vessels passing through Singapore within two weeks from the date of sale, but the shipment sailing from Subic Bay will be able to reach the Chinese port of Qingdao in a shorter time span of four-and-a-half days.

Vale is offering a 175,000 mt cargo of 65%-Fe Brazilian sinter feed Carajas fines in a tender closing Monday, 1730 Beijing time (0930 GMT) on a CFR China basis. The cargo will load from the Floating Transfer Station at Subic Bay by Wednesday.

China's Ministry of Transport in January applied stricter administration procedures for large dry bulk vessels. Those with a capacity of more than 350,000 dwt have to go through new demonstration-appraisal-approval procedures before they can call at Chinese ports.

Sources said the Carajas fines spot cargo offered was probably unloaded from Very Large Ore Carrier, or Valemax, vessels at Subic Bay before being loaded into smaller Capesize vessels prior to sailing for China.

"It is the first time I heard Vale offering an iron ore spot shipment that sails straight from Subic Bay," a Hong Kong-based trader said.

Another Singaporean trader said: "Shorter traveling time between the Philippines and China will be popular among steel mills who need very prompt loading cargoes, but it may not be equally popular with traders who have a shorter time to sell their cargoes."

Vale wasn't immediately available to comment. [Melvin Yeo, (Platts) Singapore]

Read More

Vale Starting Subic Ore Transshipment

SINGAPORE (Reuters) – Brazil's Vale will begin its iron ore distribution operations in the Philippines this weekend, the Philippine port operator said, from where the world's top miner of the raw material will transfer China-bound ore brought in by big ships.

Vale is taking a more costly route to deliver iron ore to China, its top market, which has barred the miner's giant dry bulk vessels from entering its ports to shield its domestic shipping industry.

The miner has set up a transshipment hub in the Philippines' Subic Bay port using a floating storage vessel which will start operations on Feb. 12. It is also building a $1.3-billion iron ore distribution hub in Malaysia's northern Perak state, which could be ready to handle the giant ships by 2014.

China last week barred Vale's mega ships called Valemaxes – which at 400,000 deadweight tons each are the world's biggest dry bulk carriers – to protect its shipping sector hit hard by the economic downturn and freight rates that have fallen to their lowest in more than a quarter century.

''When Vale starts full operations on Feb. 12, we expect the SBMA (Subic Bay Metropolitan Authority) to earn some 70 million pesos ($1.64 million) in additional income in the first year alone because of the projected increase in ship calls,'' Roberto Garcia, chairman of SBMA, said in a statement late on Monday.

Vale's Ore Fabrica, the world's largest dry bulk floating storage vessel, arrived in Subic Bay last week. The 280,000-deadweight-tonne vessel will serve as a platform to transfer iron ore from the Valemaxes to smaller vessels for transport to Asian markets led by China.

A Valemax, Vale Brasil, is expected to arrive in Subic on Feb. 12, Reuters shipping data showed. SBMA said it expects Vale Brasil to dock a day later.

Vale was hoping its planned fleet of 35 Valemaxes would slash its shipping costs to China to help it better compete with Australian rivals BHP Billiton and Rio Tinto.

But some analysts have said the cost of the transshipment centers would unlikely outweigh any savings from using the Valemaxes.

Vale has said its plan to build a fleet of 35 giant ore carriers, of which six are already in service, had not changed despite China's ban. (Manolo Serapio Jr., Manila Bulletin)

Read More

Subic Freeport eyes P70-M income from Vale transshipment project

The Subic Bay Metropolitan Authority (SBMA) expects to generate additional revenue of as much as P70 million with the transshipment operation here of Brazil’s Vale Mining, the world's biggest iron ore producer.

SBMA Chairman Roberto Garcia said the agency, which also administers the Port of Subic, has entered into an agreement with Vale Mining, making this free port the hub of Vale’s iron transshipment operations in Asia and turning Subic into a major player in the maritime logistics industry in the Asia Pacific Region.

“The main reason why Vale has located its operations here is Subic’s strategic location in the Asia-Pacific region,” Garcia said. “And it’s all about economies of scale. Vale will haul its ore products to Subic using its big carriers, then transfer the iron ore to smaller vessels, which the smaller ports in China will be able to accommodate,” he said.

“This is a very fortuitous development for SBMA because Subic will be at the very center of what is expected to be the biggest ship-to-ship transfer operations in the world in terms of volume,” Garcia noted.

“When Vale starts full operations on February 12, we expect the SBMA to earn some P70 million in additional income in the first year alone because of the projected increase in ship calls, as well,” Garcia added.

According to SBMA deputy administrator for port operations Redentor Tuazon, Vale will utilize its Valemax carrier vessels, which have a capacity of up to 400,000 deadweight tons (DWT), to deliver iron ore to several ports in China, now the world’s biggest user of iron ore.

The company will carry out its iron ore transshipment operation from its Valemax mother vessels, supplying ore to smaller daughter vessels, or feeders, which are either Panamax or Capesize types. The especially-designed floating terminal that will supply feeder ships will be anchored in Subic Bay.

Tuazon said that preparations are now underway for the initial transshipment operations with M/V Ore Fabrica, the floating terminal station that arrived here last Monday, January 31, and M/V Vale Brazil, which is set to arrive on February 13.

Owing to the magnitude of the transshipment operation, Tuazon said that various marine safety measures have been put into place, including the conduct of hazard and operability (HAZOP) analysis jointly made by representatives of Vale Brazil, SBMA, and agent companies involved in the operations.

All of the vessels to be used in the operation are insured and covered with protection and indemnity insurance, Tuazon added.

The SBMA has been aggressively pushing for the Port of Subic Bay to be a premier marine logistics hub in the region, as it continues to develop the market for the full utilization of Subic’s container terminals.

Recently, it has also offered various incentives to shipping companies for the development of new shipping routes to Singapore and Hongkong.

The arrival of Vale Brazil here would help Subic secure its place on the map in terms of floating terminal operations, Chairman Garcia said. (SBMA Corporate Communications)

Read More

With China shut, Vale iron ore ships head to Philippines (Two of Vale's giant ships to arrive in Subic Bay)

SINGAPORE - Two of the world's biggest iron ore carriers are due to arrive in Subic Bay Freeport for the first time next month, shipping data showed, as Brazilian mining giant Vale looks to use the Philippines as an alternative base to reach Chinese ports.

China, the world's largest iron ore importer and Vale's top market, has yet to fully open its seaports to the giant vessels after domestic ship owners strongly protested the arrival of the first and only vessel of the type into the country in late December.

With accessibility to Chinese ports uncertain, Vale has been forced to rely on its transshipment hub in the Philippines, a costlier alternative that involves employing more vessels and workers.

"I'm not surprised that Vale is sending its ships to the Philippines. They have no choice with China's ports still closed off to them," said a Singapore-based ship broker.

"They have to keep these ships moving or face major losses."

The 400,000-deadweight-tonne Vale China is due to arrive in Subic Bay Freeport, located in the Philippines' main Luzon island, on Feb. 22, shipping data showed.

That is 10 days after similar-sized Vale Brasil is expected to dock.

'A LOT OF MONEY'

Draught measurements indicated the two ships were fully loaded, each likely carrying around 350,000 tonnes of iron ore, traders said.

At current iron ore prices, the value of each cargo is nearly $50 million.

"That's quite a lot of money. Vale may be struggling to sell shipments of 200,000-300,000 tonnes in one go and so it makes more sense for them to break it up," said an iron ore trader in Singapore.

Vale's plan is to set up a floating storage vessel in its planned transshipment hub in Subic Bay from where iron ore would be transferred to smaller vessels such as panamaxes or capesizes and then transported to buyers in Asia.

Keeping readily available iron ore in Subic Bay would also allow Vale to quickly meet China's requirements, the Singapore trader said, since vessels from Brazil take at least a month before they reach China, versus about a week from the Philippines.

Vale officials in Singapore declined to comment.

Vale is also setting up a transshipment centre in Malaysia as an alternative to Chinese ports.

The Brazilian miner in October broke ground for a $1.3 billion iron ore distribution centre in Malaysia's northern Perak state, which could be ready to handle the giant ships by 2014.

Vale is banking on a fleet of 35 Valemaxes to slash shipping costs to China and better compete with Australian rivals BHP Billiton and Rio Tinto .

The 388,000-tonne Berge Everest was the first and only Valemax allowed into China, docking at Dalian Port on Dec. 28 to unload iron ore that has yet to be sold.

The China Shipowners Association has helped keep further ships from arriving at its domestic ports. The group fears the fleet will give Vale a monopoly on both the shipping and iron ore markets at China's expense. (Randy Fabi and Manolo Serapio Jr., Reuters)

Read More

Brazilian iron ore ship heads for Philippines

SINGAPORE­ -- A giant iron ore vessel owned by Brazil’s Vale, a multinational mining company, is on its maiden voyage to the Philippines and is expected to dock at Subic Bay in early February, Reuters data and shipping sources said on Monday.

The 400,000-deadweight-ton (dwt) Vale Brasil would be the second of the company’s so-called Valemaxes, which are very large ore carriers, to sail to Asia.

The first vessel, the 388,000-dwt Berge Everest, unloaded at Dalian Port on Dec. 28, 2011, ending months of delays in getting the world’s biggest dry bulk ships into China, Vale’s top market.

The cargo, estimated at 350,000 tons, has yet to be sold, however, and is sitting in storage, traders said.

Vale is banking on a fleet of 35 Valemaxes to slash shipping costs to China and better compete with Australian rivals BHP Billiton and Rio Tinto.

Reuters Freightviews and independent shipping data showed Vale Brasil is scheduled to arrive in Subic Bay on Feb. 11. Draught measurements indicated the vessel was fully loaded with cargo.

Vale Brasil was supposed to be the first of Vale’s huge ships to arrive in Asia, but was diverted last June to Italy after the Chinese government failed to provide permission for the ship to dock at Dalian Port.

A source at Subic Bay Freeport said they had not yet been advised of the Vale Brasil’s arrival.

“But we are ready anytime to accept the ships,” the source told Reuters, adding the port is deep enough to accommodate Valemaxes.

Vale aims to turn Subic into an iron ore transshipment center, where it can dock its Valemaxes, transfer cargo to smaller vessels and then use these to supply its clients in other parts of Asia.

Sources at Subic Port had said they expected the transshipment operations to start in late January or early February, as soon as Vale’s ship arrives.

The Philippine facility would be the first of at least two transshipment centers Vale is planning to open in Asia.

The Brazilian miner in October broke ground for a $1.3-billion iron ore distribution center in Malaysia’s northern Perak state which would be ready to handle the Valemaxes by 2014.

The China Shipowners Association has opposed Vale’s fleet, worried that the vessels will give the miner monopoly on both the shipping and iron ore markets at China’s expense.

The influential group has also raised concerns about the safety of the huge ships after Vale Beijing, the newest member of the Valemax fleet, developed cracks in its hull on its maiden voyage last month. (Reuters)

Read More