Ports & Ships Maritime News

Feb 23, 2006
Author: P&S


  • Earthquake shakes Mozambique and KwaZulu Natal

  • Further transport strikes look inevitable

  • Grindrod continues winning ways

  • Largescale fraud uncovered at Nigeria’s NPA

  • Bush stands firm on DP World takeover

  • Kiperousa’s logs sold

  • Second US pre-positioning ship arrives

    EMAIL: jhughes@hugheship.com
    WEB SITE: www.hugheship.com

    Earthquake shakes Mozambique and KwaZulu Natal

    A strong earthquake measuring 7.5 on the Richter scale shook Mozambique, the KwaZulu Natal coast and eastern Zimbabwe in the early hours of this morning (Thursday, 23 February). The shaking of buildings in central Durban and along the beachfront caused many residents to run into the streets.

    The port city of Beira in central Mozambique is thought to have been closest to the earthquakes epicentre off the coast and at least one building in the city has apparently collapsed. There are no other reports of damage or injuries at this stage.

    This is the second strongest earthquake to have been recorded in southern Africa since 1900. The eastern seaboard of southern African is usually considered a stable seismological region, although several of the Indian Ocean islands remain actively volcanic.

    Further transport strikes look inevitable

    As transport workers in Gauteng, Mpumalanga, Limpopo and North West provinces return to work today following three days of strike action, Transnet trade unions have reacted strongly to a statement by the minister of Public Enterprises, Alec Erwin.

    Erwin told media that the unions had missed an opportunity of being involved in Transnet’s restructuring process and said it was time for moving forward and building and strengthening Transnet instead of needlessly inconveniencing commuters. He described the planned restructuring as an absolute priority for the country’ economy.

    Erwin claimed that both he and Transnet had held lengthy discussions with the unions concerning the restructuring process, which he reiterated would not entail large numbers of retrenchments.

    In yesterday’s response the unions accuse Erwin of having “positioned himself useless to play any role in resolving the dispute” and says he has lost all credibility by making such statements as soon as he received the unions’ ultimatum (see yesterday’s Bulletin for details).

    “More disturbing is the fact that that the minister has left himself no room to respond objectively to our memorandum as he endorses the consultation as sufficient and compliments the (Transnet) management for their management of the process.”

    The unions say that the only weapon that workers have left to assert their power is the right to strike when other mechanisms have failed.

    “We will demonstrate to the minister of public enterprises how ‘misguided’ we can be on 6 March when we will bring commuter transport , freight export lines, business unit and subsidiaries including SAA to a complete standstill for 24 hours.”

    Grindrod continues winning ways

    Grindrod, the Durban-based shipping and logistics group, announced yesterday that it had lifted earnings by 56% to R851 million for the financial year to December 2005.

    Ivan Clark, Grindrod chief executive officer said good trading in December meant that group earnings were ahead of those forecast in a recent trading update.

    “We are very pleased to have achieved such good earnings in a year when dry bulk shipping markets came off their peak and the rand remained strong against the US dollar. It is a record year for Grindrod and I can see no reason why earnings shouldn’t grow further although at a lower rate from the now much higher earnings base of the group”.

    Shareholders will again be satisfied as headline earnings per share increased by 53% to R1.85 per share and total dividends for the year were 49% up with a final dividend of 32 cents per share being declared to shareholders compared to 25 cents for the same period in 2004.

    Dry bulk shipping markets, though slightly weaker than 2004, and significantly improved tanker markets, particularly in the second half of the year, benefited the group’s spot fleet, whereas the high level of contracted income provided a solid earnings base.

    Clark reiterated the group’s strategy of diversifying its fleet employment with a mix of ships employed in the spot market and on long term charter or with contracted revenue. He pointed out that having a mix of dry bulk ships, tankers and containerships further managed market risk. Currently 61% of the group’s fleet has been contracted out for 2006 with 41% in 2007 and 20% in 2008.

    “We will continue to look for opportunities to lock in earnings through contract earnings and, where appropriate ship sales. Sustainability of earnings is still a key factor”.

    The group’s shipping services’ contributed 89% of the group’s earnings with earnings growth of 54% over the prior year.

    Both the shipping divisions, Island View Shipping (IVS) and Unicorn Shipping have increased their fleets over the past year and will continue to take delivery of vessels over the next three years. These transactions were all contracted at low prices taking advantage of historical market conditions. This means that the current market value of the fleet is far greater than the book value and that the cost of chartered ships is far lower than current market rates.

    “We have a wonderful fleet of new, low cost ships, which will provide us with a solid earnings platform for the future”, said Clark.

    IVS owns charters and operates a mix of capesize, panamax and handysize dry bulk carriers. Unicorn Shipping owns charters and operates a fleet of product & chemical tankers and containerships, all of which have been contracted in at favourable rates.

    Ocean Africa Container Lines, the group’s seafreight logistics partnership with Safmarine, had an excellent year with good earnings growth.

    The group’s trading, freight and financial services division reported an improved performance with a 72% growth in earnings over the prior year from a low base.

    Largescale fraud uncovered at Nigeria’s NPA

    A federal government-appointed committee has uncovered massive fraud and reckless financial trading that it says was committed within Nigerian Ports Authority (NPA) between the years 2001 and 2003.

    The committee found that contracts during this period were awarded without regard for government and company rules and regulations and that the NPA had accumulated huge contract debt running into hundreds of millions of dollars with little or nothing to show for it.

    It recommended that creditors with genuine claims should be paid but also recommended the recovery of misappropriated funds and said that those responsible should be prosecuted.

    Bush stands firm on DP World takeover

    President Bush says he will veto any legislation that attempts to prevent the takeover of P&O Ports operations in the United States but has also admitted he had not previously been made aware that DP World was owned by an Arab country. DP World which is in the process of taking over UK-based P&O is owned by Dubai’s ruling Maktoum family.

    He received support from former president Jimmy Carter who said he couldn’t see any danger in the deal going through, but the governors of New York and Maryland have come out against the sale. New York’s governor George Pataki said he had directed the Port Authority of New York and New Jersey to explore all legal options that may be available to have the sale cancelled or altered.

    Maryland’s governor Robert Ehrlich said his concern centred around Baltimore’s port authority officials having had no advance information that a terminal in the port of Baltimore would pass into Arab hands.

    Two democratic senators including Hillary Clinton intend introducing legislation to prevent foreign ownership of US port terminals. The concerns seem to focus on what security measures will be in place with regards to future employment of personnel at the terminals, with fears that these could be infiltrated by Al Qaeda or other terrorist organisations.

    Kiperousa’s logs sold

    Durban auctioneer Roy Martin this week sold the salvaged cargo from the bulker Kiperaousa, which went aground southwest of East London last year before breaking up in the heavy seas.

    Some of the vessel’s cargo of26,000 tonnes of West African logs were washed overboard as the ship broke up and all but approximately one thousand logs was recovered in a lengthy salvage process. The original Chinese owners showed little or no interest in the sale of the cargo and an auction was consequently arranged in East London, with Admiralty Sales handling the process.

    The logs were knocked down to a Seattle-based company, Susheen Timber Trading Company for a bargain basement price of US.8 million (R10.8 million), well below the cargo’s estimated value. The salvaged cargo will be exported to China.

    The missing one thousand logs still remain unaccounted for.

    Second American pre-positioning ship arrives

    A second American pre-positioning ship arrived in Durban this week for bunkering purposes. USNS Seay (T-AKR 302), which is one of seven Bob Hope class of vessels.

    The large ship (298m – 62,096 tons displacement) berthed at New Pier 104 where she dominated the scene. USNS Seay was built in 2000 and is a diesel-powered version of the earlier Watson class of ship.

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