Ports & Ships Maritime News

May 18, 2009
Author: Terry Hutson

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  • First View – DAL KALAHARI

  • Transnet sells remaining non-core business divisions

  • Praise for Transnet reporting

  • Piracy updates: Iran sends more warships

  • Trade news – ICTSI reports sharp drop in 1st quarter volumes

  • Maersk rings some changes

  • Pic of the day – ALPHA EXPRESS


    First View – DAL KALAHARI

    The German container ship DAL KALAHARI (50,736-gt, built 2005) seen on Cape Town’s Eastern Mole shortly after docking on Saturday, 16 May 2009. Picture by Aad Noorland

    Transnet sellsremaining non-core business ivisions

    Transnet Limited on Friday announced the sale of its remaining non-core business units, leaving the state-owned company to focus on its ports, railway and pipeline businesses.

    Last week Chris Wells, Transnet’s Acting Group Chief Executive said he signed the sale of business agreement for the transfer of Shosholoza Meyl to the Passenger Rail Agency of South Africa with Mr Lucky Montana, Prasa’s chief executive. This comes after the conclusion of the share sale agreement for R140 million for the transfer to the Department of Public Enterprises (DPE) of South African Express (SAX), Transnet’s wholly-owned regional airline.

    Shosholoza Meyl, the brand name for the long-distance passenger rail service previously run by Transnet Freight Rail (the old Spoornet), was sold to Prasa, formerly the SA Rail Commuter Corporation. An amount of R500 million in respect of net operating costs for the year ended 31 March 2009 was transferred to Transnet. The deal, which also includes the coach maintenance business of Transnet Rail Engineering, became effective on 31 March 2009.

    The SAX transaction provides for Transnet to be released from all the guarantees, indemnities and warranties it provided as a shareholder. As required by the Board, Transnet has been reimbursed an amount of approximately R336 million it advanced to SAX since 1 April 2007 to the date of settlement.

    According to Wells the proceeds arising from the sale – which have already been received – will be redeployed into Transnet’s infrastructure investment programme.

    “These disposals will enable Transnet to be focused solely on running the core businesses of the Company as part of positioning them for growth”, he says.

    Mr Wells says Transnet remains committed to its intention of disposing of Luxrail, its hotel-on-wheels passenger train which is popularly known as The Blue Train.

    This leaves Transnet now made up of the following business operating divisions:

    Transnet National Ports Authority (TNPA)
    Transnet Port Terminals (TPT)
    Transnet Freight Rail (TFR)
    Transnet Rail Engineering (TRE)
    Transnet Pipelines (TPL)

    Praise for Transnet reporting

    Transnet Limited’s commitment to the highest standards of corporate governance received a boost last Friday (15 May) when the company’s 31 March 2008 Annual Report was rated amongst the best in the country, following a survey of South Africa’s top 100 listed companies and top 10 state-owned entities.

    According to Ernst & Young’s Excellence in Corporate Reporting 2009, Transnet’s Annual Report for the year to 31 March 2008 was rated as “excellent” – a rating which is earned by companies that give progressively higher levels of meaningful disclosures in their annual reports.

    Commenting on the award, Acting Group Chief Executive, Mr Chris Wells, said: “We have made a concerted effort to improving our governance processes and the Annual Report is just one of them. This will be an encouragement for us to improve further to ensure that we are not only number one among state-owned enterprises, but that we are the best in this country. Also, this is in keeping with the strategy that we have pursued in the past few: that is, to strive for excellence and being the ‘best in class’ in all we do, not only in South Africa or a particular industry, but internationally”.

    When SOEs and listed companies were combined, Transnet was ranked fifth overall behind Standard Bank, Sasol, Nedbank and Group Five.

    “Although we were not number one, we are honoured to be associated with, and ranked alongside, some of the leading corporates who are regarded as bellwethers in terms of governance not only in this country, but internationally,” said Wells

    Piracy updates: Iran sends more warships

    Iran has become the latest country to increase the number of warships assisting in patrolling the waters around Somalia, following several attacks on Iranian ships by Somali pirates. According to the Iranian spokesman at the United Nations the ships, which he did not identify, were already on their way to the Gulf of Aden and would remain there available for patrol for the next five months. Iran already has a warship in the area but it is not known whether this vessel is being replaced or not. “The aim of sending these ships is to protect Iranian commercial vessels and oil tankers or those ships which carry Iranian commodities or nationals,” said Mohammad Khazai.

    Meanwhile the Piracy Reporting Centre at the International Maritime Bureau in Kuala Lumpur says it has recorded 114 attempted pirate attacks on shipping so far this year that are connected to Somalia, of which 29 amounted to successful highjackings. This compares with a total of 111 attacks on shipping in the region during the whole of 2008.

    In a statement issued by Pottengal Mukundan, IMV director, the organisation said the increased level of attacks indicated that pirates have not been deterred by the presence of international navies operating on pirate patrol in the area. “If anything, they have stepped up operations in order to secure a higher success rate,” said Mukundan.

    British Vice-Admiral Philip Jones, operational commander of the European naval force operating in the Somali area has a different version to tell. “We have seen a substantial reduction of success rate in pirate attacks,” he maintained.

    The US Coastguard says it requires all US-flagged ships sailing around the Horn of Africa to post guards and ship owners must submit anti-piracy security plans for approval. Ship owners may decide whether the guards on the vessels are armed or not. “We are looking for things that work, not to make matters worse. We’re not interested in putting shipping companies out of business,” said a USCG spokesman.

    In West Africa Nigerian militants highjacked an oil industry tanker, the MT SPIRIT along with a second ship, a general cargo vessel last Wednesday (13 May) and are holding at least 15 crew members hostage. The Spirit was en route to Warri to discharge a cargo of condensate at the time but no details of the second vessel are available. The militants included in their demand that all foreign oil workers leave the Niger Delta area by the weekend. On Thursday they attacked and destroyed five Nigerian Navy gunboats at two naval basses in the region.

    One of Spain’s principal radio stations, Cadena SER claimed last week that the Somali pirates had employed a team of consultants in London to inform and direct them to their targets. The radio station claimed to have access to a military intelligence report containing this piece on news. There has been repeated speculation that Somali pirates appear to target certain ships for attack but this has never been confirmed in official circles nor has any proof or evidence ever been provided. Amidst the claims are suggestions that pirates seem to have details of the cargo a ship is carrying as well as the vessels’ course. Once again these reports have never been verified with evidence or proof.

    Trade news – ICTSI reports sharp drop in 1st quarter volumes

    Philippine-based international port operator reported a sharp drop of 16% in revenues for the first quarter of 2009, due mostly to a decrease in container volumes. Revenues for the quarter decreased from US$110.04 million, while net income attributable to equity holders dropped by 44% from $19.51 million in the same period last year.

    The decreases in revenue were recorded in ICTSI terminals in Madagascar, Manila, Brazil and Poland. The lower net income attributable to equity holders was mainly due to lower volume brought about by the decline in global trade and the depreciation of currencies in the countries where ICTSI ports are located (Philippine peso, Brazilian reais, Euro) relative to the US dollar in the first quarter, said the company in a statement.

    “In spite of the worst downturn in global trade since 1945, ICTSI has delivered better than expected first quarter results. The negative impact of a decline in container handling volumes was mitigated by the success of our efforts to reduce operating costs. This has enabled us to maintain our operating margins at lower levels of throughput. The first quarter is traditionally the weakest, and we will continue to focus on improving our operating efficiency so that we are well positioned to capitalize on any upturn in volumes,” said Enrique K. Razon Jr., ICTSI chairman and president.

    ICTSI handled consolidated volume of 755,958 TEUs in the first quarter of 2009, 10% lower compared to the 841,756 TEUs handled in the same period in 2008. The contraction in volume was mainly due to the decline in global trade brought about by the global economic crisis.

    Container terminal operations in Europe, Middle East, and Africa (EMEA) comprising terminals in Poland, Georgia, Syria, and Madagascar, handled 89,954 TEUs in the first quarter of 2009, 37% lower compared to the 143,700 TEUs handled in the same period in 2008. The lower contribution from the company’s ports in this segment was driven mainly by the lower throughput from the Group’s Poland and Madagascar port operations, which posted volume declines of 49% and 24%, respectively. EMEA accounted for 12 percent of the Group’s volume in the first quarter of 2009.

    ICTSI operates international ports and terminals with a global port network spanning 13 countries in four continents. Headquartered in the Philippines, ICTSI is on its 20th year of operation.

    Maersk rings some changes

    AP Moller-Maersk has announced a number of significant changes to the way its business is organised in several regions across the world, including new appointments affecting Africa.

    In notices issued to clients Chief Executive Officer Eivind Kolding announced a consolidation of regions for Europe from four down to two. “We have found we can optimise the structure by going to only two regions in Europe,” he wrote. North and Central Europe regions will be merged into a single North Europe region based in Copenhagen while the Eastern Mediterranean and FIM regions, with the exclusion of France will be merged into a second region headquartered in Genoa. A number of senior management appointments coincide with these changes.

    In Africa Tomas Dyrbye, the current Regional Manager for North Europe region has been appointed as the new CEO, taking the place of Ivan Heesom-Green who becomes Maersk Regional Manager for Africa and Managing Director of Safmarine (Pty) Ltd of South Africa.

    Pic of the day – ALPHA EXPRESS

    The Japanese products tanker ALPHA EXPRESS (28,077-gt, built 2000) seen discharging cargo at New Zealand’s Lyttelton tanker berths in March this year. Picture by Alan Calvert

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