BULK PARTNERS LIMITED

Transcription

1 BULK PARTNERS LIMITED Phoenix Bulk Carriers (US) LLC Phoenix Bulk Carriers (Brazil) Americas Bulk Transport (BVI) Ltd Nordic Bulk Carriers A/S (Denmark) Seamar Management S.A. (Greece)

2 Challenges to Shipping DRI o o o o o o What are the dangers involved with shipping DRI? What regulations need to be considered? How are ships adapted to carry DRI? What cost considerations are involved? Other challenges Conclusions

3 What are the Dangers involved when Shipping DRI? DRI is classified as a potentially Dangerous Cargo Production of DRI involves the removal of oxygen, rendering it highly reactive and susceptible to re-oxidation when subsequently in contact with moisture and air This reaction can; o Generate intense heat and, o When in contact with moisture or salt-water, the reaction releases hydrogen into the atmosphere

4 . Dangers when Shipping DRI? A little history tells us that Hydrogen is flammable!!

5 . Dangers when Shipping DRI? The Hindenburg example might seem dramatic, but it does help illustrate the risk, An ignition source (such as high heat or a spark), in combination with Hydrogen, in concentrations of greater than 4% in air, is explosive In an enclosed space, specifically that of a ship s cargo hold, the accumulation of Hydrogen can cause some problems, as evidenced by the next slides.

6 . Dangers when Shipping DRI? Notice anything odd in this photograph??..

7 . Dangers when Shipping DRI? The danger is evident

8 . Dangers when Shipping DRI? There are three (3) types of DRI involved in seaborne trade; DRI (A) Briquettes, Hot-Moulded DRI (B) Lumps, Pellets, Cold Moulded Briquettes and, DRI (C) By-Products, Fines

9 . Dangers when Shipping DRI? DRI (A) - Briquettes, Hot-Moulded (aka HBI ) Compacted under pressure into dense briquettes Facilitates easier handling, storage and the process results in a much safer material for ocean shipment Least reactive with air and moisture Shipped according to regulation is relatively safe

10 . Dangers when Shipping DRI? DRI (B) - Lumps, Pellets, Cold Moulded Briquettes It is highly reactive with air and moisture No compaction takes place, as with DRI (A) The material is porous and susceptible to re-oxidation Ocean shipment is subject to regulations that require high levels of precaution

11 . Dangers when Shipping DRI? DRI (C) - By-Product, Fines At times can be less reactive than DRI (B) DRI (C) includes all materials generated as by-products of the production and handling of both DRI (A) and (B) DRI (C) is subject to the same regulation for ocean shipment as DRI (B) There is ongoing debate as to the governing regulations for ocean shipment but, up to this point in time, no amendment to the rules is forthcoming

12 . Dangers when Shipping DRI? Before focusing on the subject of Regulations, I would emphasize. To reduce risk and avoid the occurrence of accidents, education in the handling of DRI and adherence to all safety regulations is a necessity!

13 What Regulations Need to be Considered When Shipping DRI? Accidents have prompted the United Nations, maritime department - the International Maritime Organization or IMO, to establish regulations for the ocean shipment of all forms of DRI These regulations fall under international agreements covering the Safety of Life at Sea (SOLAS) and are incorporated in the national laws of most member countries of the United Nations Due to increased accident levels, revised regulation and procedure came into effect on January 1, 2011 These regulations are found in the latest edition of the IMSBC code (International Maritime Solid Bulk Cargoes)

14 . Regulations when Shipping DRI.. The IMSBC code requires procedures that are too lengthy to cover in this short presentation but we can highlight as follows; For All Types of DRI: The Carrier shall have access to stockpiles and loading installations for inspection Suitable devices to monitor temperature and hydrogen levels are to be supplied Cargo temperature and hydrogen levels to be continuously monitored/recorded Hydrogen concentration shall be measured prior to opening hatches No ignition source is to be present (i.e. no smoking, no welding, etc..) All records shall be retained on board for a minimum of 2 years

15 . Regulations when Shipping DRI.. For DRI (A), Briquettes, hot-moulded; Moisture content is not to exceed 1% Cargo should be whole briquettes Fines content shall not be greater than 5% by weight Surface ventilate the cargo only if necessary Ventilation fans, if used, must be explosion proof, or spark-free by design, so as not to introduce an ignition source

16 . Regulations when Shipping DRI.. For DRI (B), Lumps, pellets, cold-moulded briquettes; Moisture content shall be less than 0.3% If cargo becomes wet or reacting then to be removed immediately Carriage is only permitted under an Inert Gas Blanket Ability to maintain oxygen concentration below 5% CO2 systems are not be used for oxygen level maintenance Loading equipment and vessel holds are to be dry and clean Testing to ensure weather tightness of the vessel s Hatch Covers Monitoring equipment (temperature, hydrogen, oxygen) to be on the ship Prior to sailing, certification that; - Cargo spaces are correctly sealed and inert, - Cargo temperature is stabilized at less than 65 o C, - Hydrogen is stabilized and less than 0.2% by volume

17 . Regulations when Shipping DRI.. For DRI (C), By-products, Fines ; Particle size is less than 6.35 mm, and no particles greater than 12 mm Ocean transport requirements are the same as discussed for DRI (B) The nature of this By-Product material makes it difficult to assess its reactivity. For the safety of life and of property, a worst-case scenario should be assumed at all times

18 How are Ships Adapted to Carry DRI Cargoes? No specific construction design requirements exist for Bulk Carriers trading with DRI All forms of DRI require Hydrogen monitoring devices

19 . Adapting Ships to Carry DRI.. DRI (B) and DRI (C) require an Inert Hold Atmosphere. This is frequently effected using Nitrogen. DRI (B) and (C) require devices to monitor Oxygen levels within the cargo holds DRI (C), in the event the moisture content exceeds 0,3%, may gain exemptions from the requirement to inert the hold space. To accomplish this, various complex approvals and ventilation methods must be agreed upon and confirmed prior to shipment

20 Costs involved in shipping the different types of DRI.. Voyage Costs to Consider DRI (A) DRI (B) DRI (C) Temperature Monitoring Yes Yes Yes Hydrogen Monitoring Yes Yes Yes Oxygen Monitoring No Yes Yes Hold & Deck Protection Optional Optional Optional Inert Gas Blanket No Yes Yes* Inert Gas Delivery Piping System No Yes Yes Hatch/Weather Tight Testing No Yes Yes Hatch Sealing Foam No Yes Yes Hatch Sealing/Ramnek Tape No Yes Yes Explosion Proof Vent Fans No No * Riding Technician No Optional Optional * Possible alternative to Inert Blanketing

21 . Costs Involved in Shipping DRI.. Medium to Long Term Costs (Arising from the carriage of DRI) DRI (A) DRI (B) DRI (C) Premature Paint Failure Yes Yes Yes Premature Sand Blasting & Painting of Holds in Dry Dock Premature Sand Blasting & Painting of Decks in Dry Dock Premature Corrosion of Hatch & Deck Machinery Potential Loss of Revenue due to Poor Condition of Holds Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes

22 Other Challenges when Shipping DRI Availability of Ships to carry DRI and, Freight Market.

23 Other Challenges when Shipping DRI Availability of Ships to carry DRI: o o o o o o Fact: DRI is dusty, dirty and corrosive cargo Fact: Difficult to clean and prepare cargo holds for next employment Fact: Ships that cannot properly clean suffer losses in downtime, unexpected shore-based cleaning costs and the loss of subsequent employment opportunities Fact: Generates high maintenance costs and lost time when ships are out-of-service, prematurely, in a Dry Dock facility Fact: Many ship owners are deterred from carrying DRI Fact: The result is a low availability of ships to carry DRI

24 . Other Challenges when Shipping DRI Freight Market: Producers & Consumers of DRI have recently enjoyed a low freight market Many ship owners have cut rates and accepted to carry DRI due to depressed market conditions Fundamentals of Global Dry Bulk Ship Supply & Demand are now moving toward equilibrium. Scrapping of older ships has been high and the rate of delivery of new ships is falling Many of the old ships that used to carry DRI have been scrapped There is reason to believe that ocean freight rates will see stronger markets. This will logically reduce the availability of ships to carry DRI How will DRI Producers & Consumers cope with a rising freight market?

25 Conclusions DRI is a potentially Dangerous Cargo Shipping DRI requires experience and safety - Care in choosing your Carrier is warranted DRI (A) - Also known as HBI - is the safest form of DRI to ship DRI (B) and (C) are the most reactive and dangerous forms of DRI to ship The availability of ships to carry DRI (A) is greater than for DRI (B) and (C) DRI cargoes are physically hard on ships and result in high maintenance costs DRI, is not a preferred cargo for the vast majority of ship owners The freight market appears to have bottomed out. We expect rising freight levels at some point in the not-too-distant future Do you have a plan?

26 Thank you for your attention It has been my pleasure and a privilege to deliver this presentation in Abu Dhabi at the World DRI and Pellet Congress 2013 شكرا لكم على اهتمامكم. فقد كان من دواعي سروري و شرفا لي ايضا ان اقدم هذا العرض في أبوظبي في المؤتمر العالمي.(DRI and Pellet Congress 2013)