Ports & Ships Maritime News

Jun 14, 2010
Author: Terry Hutson


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  • Transnet pleased with financial results

  • Transnet divisional financial results for 2009/10

  • Maersk and Hamburg Süd beef up Asia/Africa/South America service

  • Piracy: Asian Glory released

  • New mineral port envisaged for Nacala

  • Tanker Monte Carlo absconds from Lobito

  • Tsunami warning for Indian Ocean region cancelled

  • Pics of the day – TASMAN MERMAID



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    The Ro-Ro cargo ship NILEDUTCH PROSPECTOR (32,068-gt, built 1981) in Cape Town harbour last week. Picture by Aad Noorland

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    Transnet pleased with financial results

    Transnet says it is happy with its financial results for the year ended 31 March 2010, during which the group increased earnings to R35.6 billion despite the impact of the recession.

    While costs increased by a mere 4 percent, Transnet’s key measure of profitability – earnings before interest taxation depreciation and amortisation (Ebitda) – increased 9,2 percent to R14.4 billion due to an aggressive cost-cutting drive which yielded a R1.9 billion saving and by focusing on operational efficiencies. As a result, the Ebitda margin improved marginally to 40,5 percent from 39,3 percent.

    According to Transnet, revenue was generally impacted by lower volumes caused by the economic downturn. “Specifically, revenue was impacted negatively by an 8 percent decrease in general freight business (GFB) volumes compared to the previous year, the disappointing performance of the export coal line which was virtually unchanged at 61,8mt and the 4,5 percent drop in container volumes. The GFB was offset by a 6 percent gain in market share for containers on rail. The export iron ore line, between the port in Saldanha and the mines in Sishen, increased volumes to record levels of 44,7mt in line with customer commitments.”

    “We are pleased with the financial performance of the business as reflected in the full-year results especially in light of the recessionary conditions we experienced during the year. They show the efficacy of the financial strategy. They also vindicate management’s effort over the years in strengthening the financial position of the Company. We are particularly heartened by the increase in cash from operations,” says acting Group Chief Executive, Chris Wells.

    In line with its proactive strategy of dealing with the recession, Transnet decided to reprioritise some of the projects in the rolling five-year capital investment programme resulting in a 4,4 percent decrease to R18.4 billion capital expenditure for the year. However, all priority projects were executed.

    In keeping with Transnet’s commitment to invest in its infrastructure and to creating capacity ahead of demand, the company invested R8.7 billion on sustaining and upgrading existing infrastructure and R9.7 billion on expansion.

    Transnet is committed to spending R93.4 billion on its infrastructure over the next five years with its rail divisions, Transnet Freight Rail (TFR) and Transnet Rail Engineering (TRE), sharing 59 percent of the projected spend, the ports, Transnet Port Terminals (TPT) and Transnet National Ports Authority (TNPA), sharing 26 percent, while Transnet Pipelines (TPL) will receive the bulk of a 15 percent allocation.

    In addition, the capital investment programme will renew the Company’s locomotive and wagon fleet by 15 percent and 10 percent respectively and 20 percent of its cranes over the next three to five years to accommodate the planned ramp-up of capacity in the iron ore line to 61mt, the coal line to 81mt and the GFB to 110mt per annum. Container capacity is expected to increase from 4.56 million TEUs to 6.26 million TEUs while the completion of the NMPP will almost double petroleum pipeline capacity from the current 4,4 billion litres to 8,7 billion litres per annum.

    The capital investment programme has seen the completion of the first phase of the new port and container terminal in Ngqura, just outside Port Elizabeth; the expansion of the container handling capacity in both the Durban and Cape Town harbours; the delivery of the balance of the 50 like new locomotives which have since been deployed in TFR’s GFB; and the continued construction of TPL’s New Multi-Product Pipeline between Durban and the Gauteng market – Transnet’s single biggest capital investment item.

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    Chris Wells – picture by Terry Hutson


    Looking ahead to the current year, Wells says he is confident that volumes will show reasonable increases this year despite the recent three-week strike.

    “We have a focused recovery plan in place and importantly we have implemented a durable solution to the lack-lustre performance over the years of the coal line. I am satisfied that the ‘Quantum Leap’ initiative, which is designed to significantly raise productivity, operating efficiency and safety levels, will enable better customer service delivery and create additional capacity.”

    Since taking over last year as acting Group Chief Executive, Wells has made known his displeasure at the slow and incremental nature of the rate of improvements in customer service and productivity and operating efficiency levels.

    “We have committed to even more challenging performance targets in the new year in terms of the Shareholder Compact,” he says.

    Also, in the new financial year, Wells is planning to unveil a series of bold initiatives to partner with the private sector to ensure capacity is built wherever appropriate to enable economic growth.

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    Transnet divisional financial results for 2009/10

    Transnet National Ports Authority (TNPA)

    Revenue increased by 4,1 percent% to R6.8 billion (2009: R6.6 billion). This increase is attributable to an average tariff increase of 6,7 percent offset by net lower cargo related activity of 4.5 percent. During the year iron-ore volumes and manganese export volumes increased by 35 percent and 18 percent respectively. These were offset by negative growth in container and automotive volumes of 4,5 percent and 24 percent respectively, as a result of the global economic downturn.

    The greenfields Port of Ngqura began operation in October 2009 and is an exciting development for South Africa. Operating costs increased by 1,6 percent to R1.9 billion compared to the prior year due to operational efficiency and cost-saving initiatives implemented during the year. With the introduction of quadruple shifts for pilots and berthing crews in certain ports as well as the increase of the marine fleet, operational efficiencies improved. Consequently, EBITDA increased by 6.1 percent to R5.6 billion (2009: R5.3 billion).

    A tariff increase for 2010/11 of 4.42 percent was awarded in January 2010, which is significantly below the increase requested in the tariff application of 19,13 percent.

    Transnet Port Terminals (TPT)

    Revenue increased marginally by 2,4 percent to R5.2 billion (2009: R5.0 billion). This increase was mainly due to increased bulk volumes, specifically export iron ore and manganese partially offset by decreased container and automotive volumes. Record export iron ore loading rates have been achieved at the Saldanha Iron Ore Terminal as a result of the implementation of dual ship loading, increasing the average rate to 6,341 tons per hour during the year (2009: 5,954 tons per hour).

    Container handling rates, however, remain far too low, and is receiving priority attention and hence significant improvements are expected. The Port of Ngqura handled 78,423 TEUs up to March 2010.

    Operating expenditure increased by 5.6 percent to R3.5 billion (2009: R3.3 billion) mainly due to the increase in maintenance costs which were in line with plans to improve efficiencies and safety measures at all terminals. The effect of this increase was minimised by cost-saving initiatives adopted. Consequently, EBITDA decreased by 4.0 percent to R1.6 billion (2009: R1.7 billion).

    Transnet Pipelines (TPL)

    Revenue decreased by 20.0 percent to R1.2 billion.

    Transnet Freight Rail (TFR)

    Revenue increased by 11.8 percent to R20.6 billion (2009: R18.4 billion) compared to the prior year. Export iron ore volumes increased by 21.5 percent to 44.7mt (2009: 36.8 mt) in the current year which represents an increase of 41.0 percent since 2005. The increase in volumes can be attributed to the significant capital investment; operational efficiency improvements and the implementation of dual loading cranes at the ports.

    Export coal volumes decreased by 0.2 percent to 61.8mt (2009: 61.9mt) mainly due to operational issues that were experienced by TFR, as well as the delays experienced in the commissioning of the Richards Bay Coal Terminal expansion. A detailed plan has been developed to address the TFR issues and the benefits are already evident with a record volume of 1.5mt per week being achieved in the final quarter of the year. Export coal tariffs were increased in line with contractual commitments with customers to achieve a fair return on invested capital.

    The GFB (general freight business) was negatively impacted by the economic downturn resulting in a decrease in volumes to 72.1mt compared to 78.4mt in the prior year. This was off-set by an increase in market share of containers on rail; an effective yield and mix management programme and significant volume recovery in manganese, magnetite, steel and rock phosphate in the latter half of the year resulting in higher than planned revenues.

    A concerted effort was made to contain costs resulting in net operating expenses increasing by only 3.2 percent to R13.4 billion when compared to the prior year. This resulted in a 30.3 precent improvement in EBITDA to R7.4 billion (2009 : R5.7 billion). – source Transnet

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    Maersk and Hamburg Süd beef up Asia/Africa/South America service

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    Hamburg Süd’s Monte-class container ship MONTE OLIVIA (69,132-gt, built 2004) which was seen at Durban. Picture by Trevor Jones

    Because of anticipated peak seasonal requirements, Maersk Line and Hamburg Süd will be introducing a second string of 10 ships in the 2,100-TEU range on its service between Asia, South Africa and the east coast of South America.

    The introduction of the second string takes effect from the first week of July with each company providing five ships. The port rotation is Shanghai, Ningbo, Shenzhen-Dachan Bay, Hong Kong, Singapore, Tanjung Pelepas, Durban, Santos, Itajai, Port Elizabeth, Durban and back to Shanghai.

    The first string rotation remains Nagoya, Yokohama, Busan, Shanghai, Hong Kong, Tanjung Pelepas, Singapore, Sepetiba, Santos, Buenos Aires, Rio Grande, Navegantes, Paranagua, Santos, Singapore, Hong Kong and back to Nagoya.

    The two lines expect to return to a single string configuration after November.

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    Piracy: Asian Glory released

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    Asian Glory – picture EU NAVFOR

    According to the Ukraine government, Somali pirates have released the highjacked car carrier ASIAN GLORY which was seized some 600 n.miles off the Somali coast on 1 January this year.

    The Asian Glory has a crew of 25 on board – 10 Ukrainians, eight Bulgarians, five Indians and two Romanians. All are reported to be in good health.

    “Months of effort by Ukrainian diplomats as well as other state bodies in co-operation with the ship owner have brought negotiations with the pirates to the closing stages,” the government statement said in a statement. There was no mention of whether a ransom was paid but this is assumed. The pirates originally demanded a ransom of USD 15 million for the ship and crew – the unusually high amount based presumably on the cargo of two thousand motor cars on board the vessel.

    When captured Asian Glory was carrying 2,305 South Korean-manufactured motor vehicles and was bound from Singapore to Saudi Arabia. On Friday the ship was reported to be sailing away from the Somali coast.

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    New mineral port envisaged for Nacala

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    Nacala Bay from space – Google image

    An environmental impact study, ordered by the Brazilian Vale do Rio Doce Company (CVRD, or simply Vale), is to start this June in preparation for building a mineral seaport in Nacala-a Velha, in the northern Mozambican province of Nampula, and a 200 kilometre branch railway line linking the coal mines of Moatize, in the western province of Tete, to Malawi.

    According to Veronica Langa of the provincial government in Niassa province, a delegation from the Vale Company met with government officials in Lichinga, the Niassa capital, last week to discuss issues related to the two projects.

    These undertakings are to facilitate the export of coal from the Moatize mines to international markets. If found feasible, the railway will start in Moatize, cross Malawi, and link up with the existing northern railway line.

    The current northern line goes from Malawi across Niassa and Nampula to the existing deep water port in Nacala. The new mineral port will be adjacent to the existing port.

    Langa added that the rehabilitation of the branch line from Cuamba to Lichinga will depend on the results of coal exploration in Maniamba in the Niassa district of Lago.

    “We held a fruitful meeting with the representatives of the Vale Company, but negotiations are still in an initial stage”, said Langa. “As you know, there are signs of the existence of coal in Maniamba, which means that we can still hope that the Cuamba-Lichinga line may be rehabilitated one day.” - Club of Mozambique

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    Tanker Monte Carlo absconds from Lobito

    A products tanker, the MONTE CARLO (IMO number 8420232, Call Sign 9VGD9, of 27,821-dwt, built 1987) is reported to have absconded from Lobito harbour in Angola without payment of certain fees or authority to sail.

    The vessel, which is owned by BMP Shipholding of Singapore and managed by Thome Shipping also of Singapore, reportedly issued a MAYDAY while en route to Lagos in position Latitude 12º51 S, Longitude 11º14 E wich is around 170 n.miles from Lobito.

    Lobito port authorities organised a rescue mission which went to the aid of the tanker on 22 May, with the ship being towed into port on 26 May. African Steamship, a division of Hull Blyth was appointed as agent for the vessel.

    On 12 June the Monte Carlo slipped out of Lobito, apparently without notifiying the authorities of their intention. This was said to be between the hours of 02h00 and 05h00. Not only were certain accounts unpaid but the port bill was similarly unpaid. Once alerted to the ship’s disappearance Lobito port authorities were able to ascertain that the vessel was some 50 n.miles north of the port, minus ship’s papers which are in the possession of the port harbour master. Attempts are being made by various Angolan authorities to have the ship return to Lobito.

    Tsunami warning for Indian Ocean region cancelled

    A tsunami warning issued on Saturday (12 June) for all areas of the Indian Ocean has been cancelled.

    The warning followed a major earthquake of magnitude 7.7 which struck Nicobar Island at 01h27m50s at epicenter 7.702N, 91.975E. Mild tremors were felt along the western seaboard of India including Chennai City (Madras). It was subsequently determined that a significant tsunami had not been generated by the earthquake.

    Pics of the day – TASMAN MERMAID

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    The Seatrade reefer TASMAN MERMAID (9,829, built 1993) arriving in Cape Town last week to load a cargo of fruit. Picture by Ian Shiffman

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