Odfjell Quarterly October 2012

highlightsODFJELL QUARTERLY magazineThe petchem marketBy Christian Stensaker, VP Business Development & Projects, Bergen6The semi-refrigerated vessels (excludingethylene carriers) and fully refrigeratedcarriers generally carry traditional LPGcargoes such as propane, butane andammonia.The Bow Gallant and Bow Guardian, however,are LPG carriers with ethylene-carrying capacity.Statistically, such vessels are employed inthe ethylene market about 50% of the time,while they are used to carry petchems for theremaining 50%. Volumes of ammonia andLPG cargoes carried by ethylene carriers aretherefore marginal.Total volumes of LPG, ammonia andpetchem shipped in 2011 (Drewry Q2, 2012):LPG 63 million mt or about 70%Ammonia 14 million mt or about 16%Petchem 12 million mt or about 14%Growth in seaborne trade for petrochemicalgases is expected to be 4% in 2012, 2.7% in2013 and 3.4% in 2014. These figures are in linewith or slightly above corresponding expectedgrowth figures for ammonia and LPG.Middle East export accounts for about 42% oftotal LPG, ammonia and petchem volumes,with countries in South and North East Asiaas the largest receivers.This situation is not set to change, as newexpansions in the Middle East are plannedfor the period 2014 to 2016. This expansion,coupled with Asian demand growth, isexpected to be the bedrock of trade growthalso in the years to come. The world’s largestsingle importer of LPG, Japan, reportedimports of 12.4 tonnes in 2011, which is upfrom 10.2 million tonnes in 2010 and is thethird consecutive year of post-recessionimprovement. (Source: Clarksons Spring 2012)Shale gas and EthanolDue to the presence of large volumes ofethane in shale gas, ethylene will be aninteresting cargo in the years to come. The USpetrochemical industry is set to see significantinvestments to monetize on the shale gasadvantage. If and when all the projects cometo fruition, the North American market willnot be able to absorb all the additional derivativecapacity, and it is expected that some ofthe production will be earmarked for exportmarkets. Some analysts describe the US GulfCoast as the 'new Middle East' with largeamounts of export-oriented capacity destinedfor countries outside North America.(Source: CMR, Shale Gas Impact on C2, C3and C4 Derivatives)By 2010, ethylene was produced by more than110 companies in 55 countries. To meet theever increasing demand for the product, productionfacilities keep being added globallyand particularly in the Persian Gulf and China.According to Chemical Market ResourcesInc., a total of 15 new cracker investmentsand expansions have been announced inthe US in the period 2012-2017, all relatingto ethylene capacity.Experienced gas carrier crewBy Jennifer Franco, Information Officer, ManilaOdfjell in the Philippines (OiP) will workwith Orient Ship Management(OSM) inmanaging the crew for Odfjell’s two gastankers. The two manning companies willeach provide an equal number of crew forthe vessels.The collaboration is a practical operationaldecision considering Odfjell’s gradual re-entryto the market with only two vessels. – Thecollaboration with OSM will provide us withexperience in developing an excellent Odfjellcrew pool to man our gas carriers. Odfjell isaiming to grow and become an importantplayer in this sector. Once we add more carriersand expand our fleet for the gas market,OiP will solely handle crew management, saysMarites Villena, Crewing Manager for the gascarriers. OSM’s experience in crew managementfor gas tankers fuelled the partnership.Training and Company familiarisationThe gas carrier crew chosen from Odfjell andOrient Ship Management (OSM) to run theBow Gallant and Bow Guardian, took part intraining at Odfjell Academy in Subic in Julyand August. The week-long training, led byexperts from the Academy and Fleet Bergen,covered discussions on Odfjell familiarisation,systems and procedures, gas operations andother topics relevant to on board safety.Captain Ole Breimo, Senior Marine Superintendentfrom Fleet Bergen and trainer onOdfjell gas operation procedures said theCaptain Ole Breimo, Senior Marine Superintendent from Fleet Bergen, on Odfjell gas proceduresrecent training has been very productive: – Itwas a good two-way communication. This is agood opportunity to develop the competenceof officers and crew for our gas tankers, hesaid.Odfjell Academy in collaboration withFleet Asia, Fleet Bergen and the CrewingDepartment of Odfjell in the Philippines (OiP)organised and designed the materials for thetraining.www.odfjell.com