Markets - A ‘wait and see’ attitude prevails

http://www.tankeroperator.com/ViewNews.aspx?NewsID=7366

A relatively active week for VLCC, despite the fact that activity appeared a bit slow. 

 

Fixing continued well under the ‘radar’ and in particular, Chinese ships were being hoovered up for local business. However, non-Chinese tonnage was also quietly disappearing, Fearnleys reported.

MEG tonnage is in tight supply up to the middle of February, although more ample for second half of the month. Reports of tonnage ballasting from the Far East to Caribbean raised some eyebrows.

Iran remained in the headlines with a couple of crude deals concluded, but the country is still not a major factor, as many owners remained undecided.

The market was adopting a bit of a ‘wait and see’ attitude, the broker said, but appeared steady for the major VLCC routes, although there was some increased activity Caribbean/East.

The soft trend continued for Suezmaxes as the market tumbled for WAfrica/UK-Cont-Med voyages last week. Rate yields were about $27,000 per day, the lowest seen year-to-date. There are, however, more cargoes to be worked ex WAfrica for the remainder of the month, but as charterers were patient in approaching the market, we may not see the rates move up yet, Fearnleys said.

Looking forward, there are many WAfrican cargoes already reportedly sold for long haul voyages and particularly for Asia on VLCC’s in March, which did not help the Suezmaxes.

Daily returns for Aframaxes trading in the ice market ex Baltic is now around $50,000 per day, compared with earnings of about $30,000 per day for voyages ex North Sea. The Baltic was looking a bit softer in the 14th-20th February window.

The March loading programme ex Hound Point is expected to be one of the largest in years. This, coupled with the VLCC berth being down for maintenance during the first half of the month, will lead to an upward pressure on rates.

The Med/Black Sea market plunged this week. Most thought that the market had hit rock bottom, but charterers managed to make life harder for owners. Sidi Kerir/Portugal was done at WS73,5 which gives a daily return of about $9,000 per day. It seems that the priority for a lot of owners today is to keep their ships moving.

As the position list could take a vessel form one side of the Mediterranean to the other, we don't expect any quick recovery the next couple of weeks, Fearnleys said.

In the past couple of weeks, brokers reported that Unipec had fixed the 1999-built ‘Maran Gemini’ for 12 months at $45,000 per day, while the 2003-built ‘Nave Celeste’ was said to be fixed to Core Petroleum at $45,500 per day.

The newly built VLCC ‘Alice’ reported last week as fixed for a gasoil cargo, was said by brokers to have been fixed by Total for six months at $62,500 per day, which included the gasoil cargo on her maiden voyage.

ST Shipping was believed to have fixed the 2011-built Aframax ‘Green Warrior’ for three months at $40,000 per day, while CCI was reported as taking the 2009-built LR1 ‘Summit Africa’ for 15 months at $23,500 per day.

Another Aframax - ‘Cakra Partiot’ ex ‘Aegean Legend’ was reported fixed to Glovis for 12 months at $24,000 per day.

Masel was said to have taken the MR sisters ‘Gotland Sofia’ and ‘Gotland Aliya’ for 12 months at $17,250 per day, including a profit sharing partnership. Koch was believed to have fixed the 2003-built MR Qurtuba for 12 months at $17,500 per day.

St Shipping was again said to be behind the fixture of the 2003-built Handysize Vallermosa’ for 12 months at $17,250 per day, while Flopec fixed the 2006-built Handysize ‘Arionas’ for three years at $19,000 per day, Capital confirmed.

In the S&P market, the 2003-built Handy ‘Cielo di Roma’ was confirmed as sold to Turkish buyers Akar Shipping for $13.8 mill.

The elderly 1992-built shuttle Aframax ‘Navion Torinita’ was reported sold to undisclosed interests for $6 mill.

Leaving the fleet was the 1986-built parcel tanker ‘Stolt Sapphire’ thought sold to Indian ‘green recyclers’ for $260 per ldt.

In the newbuilding sector, Turkish owner Ditas was believed to have ordered two Suezmaxes at HHI for $63 mill each.

Stena Bulk has decided not to exercise options to build another two IMOIIMAX MRs at CSSC Offshore & Marine Engineering.

New Asphalt carrier classed by BV

http://www.tankeroperator.com/ViewNews.aspx?NewsID=7361

Paris-based class society Bureau Veritas has classed the 37,000 dwt asphalt carrier ‘Asphalt Splendor’, which was delivered to US-based Sargeant Marine last December. 

 

The vessel was built at Avic Dingheng, China and is the first of two designed by Chinese design institute SDARI in co-operation with Sargeant.

The hot asphalt cargo can be carried liquid at temperatures of up to 170 deg C in 16 independent tanks with a total capacity of 35,666 cu m.

Philippe Donche-Gay, Executive Vice-President and Head of the Marine & Offshore Division, Bureau Veritas, said, “The high cargo temperatures in asphalt carriers place special demands on structure, construction quality and equipment.

“Bureau Veritas is a world leader in this sector and currently classes a large number of these ships. The ‘Asphalt Splendor’ will be a state of the art vessel, with excellent environmental and operational performance. We welcome this project, which builds on our strong relationship with Sargeant Marine.”

Dan Sargeant, Sargeant Marine president, said, “It is imperative to stay ahead of the game, thinking innovatively when it comes to economics, as well as operations. We are looking forward to the second of these new vessels, also BV classed, which give us a distinct advantage in the marketplace, as there is truly nothing like this out there.”

Hijacked chemical carrier freed

 

http://www.tankeroperator.com/ViewNews.aspx?NewsID=7352 

The Greek chemical tanker, said to be hijacked by Biafran separatists off Nigeria last weekend, has been freed.

 

It was reported that threats had been made that the 2003-built 9,055 dwt ‘Leon Dias’ and its crew would be blown up if the government did not release a Biafran leader, Nnamdi Kanu, from jail. However, the Nigerian Government claimed that there were no Biafran activists left and that the tanker was not in Nigerian waters when attacked 

Five seafarers on board were reported as kidnapped and taken hostage, and also that the Chief Officer was seriously wounded during the attack.

Although exact details were still vague, the vessel was said to have been hijacked in the Gulf of Guinea while sailing from Lome to Bata and taken towards Cotonou in Benin. AIS tracking data shows the vessel off Cotonou.

The Benin navy was subsequently thought to have taken control of the chemical tanker, which is owned Athens-based Peregrine Shipping and managed by Leon Shipping & Trading, according to Equasis.

Flint is a horrible tragedy. But a gas leak in Los Angeles may spell an even greater environmental disaster.

https://www.yahoo.com/news/flint-is-a-horrible-tragedy---but-a-gas-leak-in-los-angeles-may-spell-an-even-greater-environmental-disaster---191109888.html 

LOS ANGELES — The drinking-water crisis in Flint, Mich., is both an outrage and a tragedy: a sordid tale of government cost-cutting, callousness and coverups that exposed 27,000 children to extremely high levels of lead and may have killed at least 10 people.

It has also brought attention to the wider risk of toxic lead exposure, whether from hazardous urban soil or from the estimated 3.3 million utility lines nationwide that contain the poisonous metal.

Yet at the same time Americans have been shocked and saddened by Flint — and rightfully so — another environmental calamity has been unfolding 2,300 miles away in the Porter Ranch community of Los Angeles that may be even more troublesome for more people in the long term.

“Flint is the more egregious case of neglect, and it’s far worse in terms of the human cost,” says Rob Jackson, an environmental scientist at Stanford University. “But nothing about Flint has the sort of national or global consequences that the problems at Porter Ranch have.”

That’s because, as horrific as it is, Flint is the exception that proves the rule. Lead exposure in the U.S. has declined dramatically over the past four decades thanks to government-mandated monitoring and treatment — and that isn’t going to change.

Meanwhile, Porter Ranch hasn’t received nearly as much national news coverage as Flint. But if nothing is done, what’s happening there could happen more and more throughout the U.S. in the years ahead.

The short version of the Porter Ranch story is that on Oct. 23, the Southern California Gas Co. discovered a rupture in an underground pipe linking nearby Aliso Canyon, one of the country’s largest natural-gas storage reservoirs, to the surface of the earth. Authorities soon determined that the amount of methane leaking from Aliso Canyon each day  — 2.5 million pounds, the most in U.S. history — was roughly equivalent, in terms of environmental impact, to the daily emissions from six coal-fired power plants, 2.2 million cows, or 4.5 million cars.

Local children — and pets — began to suffer from headaches, nosebleeds, and vomiting. The Federal Aviation Administration, fearing that a plane would ignite the massive methane cloud hovering over the area, instituted a no-fly zone. More than 2,500 families fled their homes. Lawsuits were filed (including new criminal charges Wednesday against SoCalGas). Businesses struggled to stay open. Property values plummeted. Even today, more than three months later, the leak still isn’t under control. All told, Porter Ranch has become one of the worst environmental disasters in recent memory, with a carbon footprint larger than the catastrophic BP oil spill of 2010.

Still, it makes sense that Flint is a bigger news story than Porter Ranch. SoCalGas waited three days before reporting the leak. In Flint, state and federal officials dragged their heels for more than a year. Residents of Porter Ranch have reported various short-term illnesses, mostly from the sulfurous odorants added to methane to aid in detection. (Experts say the gas itself isn’t harmful.) In Flint, thousands of children have been exposed to a toxin that could cause irreversible damage to their developing brains and nervous systems. Porter Ranch is an affluent, largely white community; Flint is largely poor and largely black.

But while Porter Ranch isn’t as unjust as Flint, and while the immediate human toll isn’t nearly as harrowing, the leak has exposed major problems with our growing natural-gas system that will only get worse, even after the well is capped. And this, like Flint, should be cause for nationwide concern.

 

Alison Canyon isn’t unique. In fact, it’s one of more than 400 such natural-gas storage sites across the country, and the vast majority of those aging facilities are likely to have the same vulnerabilities — in this case, 60-year-old pipes and a missing shut-off valve that was never replaced after breaking in 1979 — that led to the Porter Ranch rupture. Recent research estimates that natural-gas-gathering facilities alone routinely leak 100 billion cubic feet of methane each year — more gas than the entire country burns in a day.

And that’s just what seeps out on a regular basis, without any sort of catastrophic breach. According to a recent FiveThirtyEight report, the city of Boston alone had at least 1,868 documented unrepaired leaks in its gas lines as of March 2015, and the oldest has been leaking since 1985. The truth is, much of America’s natural-gas network has operated for decades with little investment in updates and inspections, and regulations — both state and federal — are outdated and underenforced. That’s left companies to decide how much they will or won’t spend to keep their gas fields modern and safe.

If the only effects of methane leakage were headaches and nausea, loose regulations and lax enforcement would be unfortunate. But what makes Aliso Ranch such a wake-up call is the staggering effect it’s having on the environment. As of Jan. 24, estimates showed that the leak had released the equivalent of 2.1 million metric tons of carbon dioxide into the atmosphere — more greenhouse gas than 440,000 cars emit in a year. Given the fact that methane’s effects on global warming are 84 times as potent as carbon dioxide’s, that’s enough gas to make Aliso Canyon the single biggest contributor to climate change in California and to set back the state’s efforts to curb emissions — some of the most aggressive in the nation — by an entire year. Similar leaks have also caused devastating explosions in the past.

At a time when new fracking technology is fueling the rapid expansion of America’s natural-gas system and generating more wear and tear on aging facilities, lawmakers should be working to prevent the next Porter Ranch. In the Golden State, Gov. Jerry Brown has issued an emergency order requiring SoCalGas and other utilities to “conduct daily inspections of wellheads using infrared leak-detection technology, verify the mechanical integrity of wells, measure gas flow and pressure and regularly test safety valves, among other steps.” Meanwhile, state legislators have proposed stringent new safety regulations for all 14 of California’s underground natural-gas storage facilities.

But Porter Ranch isn’t just a California problem; it’s a national problem. And while it may not be as tragic a tale as Flint, it has the potential to become a more familiar and environmentally devastating one if the rest of the country simply forgets and moves on.

Oil Rises After Russia Says Open to OPEC Meeting

http://www.foxbusiness.com/markets/2016/02/03/oil-rises-after-russia-says-open-to-opec-meeting.html

Oil rose on Wednesday, paring earlier losses after fresh comments from Russia about its openness to talk with OPEC over output cuts helped revive hope among investors that the world's largest producers could act to boost prices.

Russian Foreign Minister Sergei Lavrov said if there is consensus among the Organization of the Petroleum Exporting Countries and non-OPEC members to meet, "then we will meet."

This helped push the price of oil, which had been set for a third day of declines after data on Tuesday showed another big build in U.S. inventories, off the day's lows.

Brent for April delivery rose 40 cents to $33.12 a barrel by 0930 GMT, pulling away from a session low of $32.30. U.S. crude futures rose 46 cents to $30.34, off a session low of $29.40.

"Is there going to be a meeting between Russia and OPEC? That is a supportive factor in this rally that we've seen in the last one hour," PVM Oil Associates analyst Tamas Varga said.

"(Oil-producing) countries are at the brink of default ... so the situation is dire."

Cash-strapped Nigeria and Angola are discussing potential financing from the World Bank, which, together with the International Monetary Fund, is in talks with Azerbaijan.

The 70 percent drop in the crude price over the last 18 months has hit the budgets of oil-dependent nations such as Nigeria, Venezuela, Russia and even some of the richer Gulf nations such as Bahrain.

Demand for oil, particularly in Asia, proved robust last year, but not enough to absorb near-record supply and ballooning inventories of unwanted crude.

U.S. crude stocks rose by 3.8 million barrels to 500.4 million in the week to Jan. 29, data from the American Petroleum Institute showed.

"The (global) inventory situation is going to get worse in the second quarter as we hit the peak refining rate at the end of this quarter," Tony Nunan, oil risk manager at Mitsubishi Corp in Tokyo, said.

A rebalancing between oil demand and supply will not come until mid-2017, Morgan Stanley said in a note.

"Despite the myriad announcements of capex cuts, production has yet to respond enough to rebalance the market," Morgan Stanley said.

Goldman Sachs in a note on Monday said volatility in the oil price, which is at its highest since the collapse of failed U.S. investment bank Lehman Brothers in 2008, could reach 100 percent as storage capacity comes under pressure. 

(Additional reporting by Keith Wallis in SINGAPORE; Editing by Dale Hudson)

Inside Story - What's behind the falling price of oil?

Nigeria Ups Export Cargos for March

 

http://www.petroleumafrica.com/nigeria-ups-export-cargos-for-march/

With the lifting of the force majeure on Brass River crude by ENI and the reopening of Shell’s Trans Niger pipeline, Nigeria should see a bump in oil exports in March. According to export schedules, the West African country will up its exports by three cargos over the 59 export cargos scheduled for February.

The country could be exporting more but the tapping of pipelines by vandals keeps its production capacity down. Nigeria’s Ministry of Power, Works and Housing revealed that the damage to pipelines is costing the country $400,000 per day.