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EuropeanCommissionDirectorateGeneralEnvironmentShipDismantlingandPre-cleaningofShipsFinalreportJune2007EuropeanCommissionDirectorateGeneralEnvironmentShipDismantlingandPre-cleaningofShipsFinalreportJune2007Reportno.
64622-02-1Issueno.
2Dateofissue28hJune2007PreparedFrankStuer-Lauridsen,MadsP.
Jensen,ThomasOdgaard,HelleHusum,DanOlsen,KlausW.
RinggaardCheckedKlausW.
Ringgaard,FrankStuer-LauridsenApprovedFrankStuer-LauridsenShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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TableofContentsExecutivesummary5Foreword16Abbreviationsandglossary171Introduction211.
1Shiprecyclingasaglobalactivity211.
2Objectives221.
3Outlineofthereport232Internationalgovernanceofshipdismantling252.
1ExistingEUandinternationalinstrumentsrelevantforshipdismantling252.
2RecentcasesofapplicationoftheWSRtoshipsfordismantling292.
3WorkbyIMO,BaselandILObodies312.
4ReviewofthedraftIMOConvention313UpdatedstatusandprojectionsforEuropeanend-of-lifeshipsuntil2020373.
1Introduction373.
2Historicaldecommissioningvolumes373.
3Methodologyforanalysisofcurrentfleetandfuturedecommissioningvolumes403.
4Thecurrentfleet413.
5Futurescrappingvolumes494Updatedstatusofcurrentlyavailableandprojectedshiprecyclingandpre-cleaningcapacity554.
1FacilitiesforgreenrecyclingintheEU56ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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4.
2FacilitiesinEUcandidatecountriesTurkeyandCroatiaandEFTAcountryNorway634.
3GreenshipdismantlingfacilitiesoutsideEUandEuropeanOECDcountries654.
4Asiaandnon-OECDcountries664.
5Summaryofexistingandprojectedcapacityandrecyclingneed685Overviewofstandardsandguidelinesforshipdismantling715.
1Existingstandardsandguidelinesonsafeandenvironmentallysoundmanagementinshipdismantling715.
2ExistinginternationalEHSstandards745.
3EuropeanUnionguidance815.
4Guidanceinothernations835.
5Recyclingpoliciesandstrategiesofprivateshippingassociationsandcompanies866End-of-lifeships:hazardouswasteorpre-cleaned896.
1Introduction896.
2Communitylawonhazardouswaste906.
3Pre-cleaning936.
4Existingpre-cleaningguidelines986.
5Riskassessmentoftowingofpre-cleanedshipsfromEuropetoAsia1006.
6Conclusiononpre-cleaning1067Costsofshipdismantlingandpre-cleaningofships1097.
1Introduction1097.
2Approach1107.
3Caseanalysis1147.
4Generalisationandsum-up1258DifferentoptionsfordevelopingstrategiesforshipdismantlingintheEU1278.
1Barriers,optionsandincentives1278.
2Ensuringasupplyofvessels1298.
3StrategiestostrengthencapacityinEUbasedfacilities1318.
4UpgradingfacilitiesoutsidetheEU135ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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9Recommendations13910References143TableofAppendicesAppendixA:Methodologyforhistoricalvolume,currentfleetandprojectedscrappingAppendixB:StatusandprojectionsforEuropeanend-of-lifeshipsuntil2020AppendixC:Listof"green"shiprecyclingfacilitiesAppendixD:ExtendedlistofhazardousmaterialsShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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ExecutivesummaryPresentlegislativeandenforcementenvironmentTheWasteShipmentRegulation(WSR)istheEuropeanUnion'simplementa-tionoftheBaselConvention,anditdirectlyappliesto"vesselsandotherfloat-ingstructures",whichcanonlybeexportedforrecoveryiftheyare"properlyemptied"ofcertainspecifiedhazardoussubstances.
Itisundisputedthatvesselsdocontainsuchsubstancesprimarilytoensureavessel'scompliancewithanumberofinternationalmaritimesafetyregulations,butitislessstraightfor-wardtodeterminewhetheravesselisindeedsoldforfurtheroperationorex-portedforrecyclingpurposes.
InanumberofcasesinseveralEUmemberstatesithasprovenextraordinarydifficulttoproveashipowner'sintenttoscrap,andthereforetheapplicabilityoftheWSR.
Theshippingindustrywasprobablythefirstindustrytodealwiththechal-lengesofinternationalisationsome200yearsago.
Manyregulationsnowexisttoensurethesafetransportofpeopleandpropertyfromonecorneroftheworldtoanother,theintegrityofavesselandanefficientmarketplacefornew,usedandobsoletevessels.
ForthisglobalisedindustryithasbeenagreedtodevelopanIMOConventionasanewmandatoryinstrumentonshiprecycling.
Acon-ventionisdraftedpresentlytobereadyforadoptioninyear2008or2009withexpectedentryintoforceattheearliestin2013.
TheInternationalConventionfortheSafeandEnvironmentallySoundRecy-clingofShipsaimsatboththeresponsibilitiesoftheshippingindustryandoftherecyclingindustry.
Thepreparatoryworkhasbeenchallengingduetotheinclusionofthelandbasedrecyclingfacilities,forwhichtheregulationanden-forcementistraditionallyanationalmatterratherthananinternationalone,andithaspreviouslynotbeenconsideredpartofIMOConventionstoregulatelandbasedactivitiesexceptinports.
Itisexpectedthatacompromisewillbefoundthatasagoalensuresan"equivalentlevelofcontrol"withthehazardousmate-rialsasfoundinthepresentWSR,andsimultaneouslyensuringa"levelplayingfield"forboththeshippingindustryandtherecyclingindustry.
Itisconsideredimportanttoavoidcertainflagstatesimposingalaxenforcementofthemecha-nismstoensureaproperlydocumentedandcompliantphaseoutofavesselandsomeneworexistingrecyclingstatesallowsubstandardconditionsontherecy-clingyards,thusattractinganoncompliantmarket.
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AstrongandenforceableglobalConventionisneeded.
VolumeofscrapmarketforshipsintheEUIncasetheworkonaglobalinstrumentisnotsuccessfularegimecanbeim-posedonaregionalEuropeanbasis.
However,thechallengeforenforcementofaEuropeansafeshiprecyclingpolicyisinthemerchantfleet,whereflagsand/orownersofshipsmaychangequickly.
InthiscasereflaggingmayremovethemajorpartofthepotentialscrapmarketfromtheEU.
Thisislesspronouncedinthegovernmentownedfleets,whichobviouslyin-cludesthenavelfleet,butmayalsoincludedanumberofothervesselsunderauthoritiessuchasCoastGuard,MeteorologicalInstitutes,PollutionPreventionandTransport.
Scrapvolumeoflargervesselsfromgovernmentfleetsmaycompriseapproximately40,000LDT/yearoverthecoming10years.
Onlyveryfewnavyvesselsaresolargethattheyrequirethedevelopmentofspecialrecy-clingprocedures.
SeveralEuropeancompanieshavesubmittedtheirbidsforthedemolitionofClemenceauanditisthereforeexpectedthattheconditionsforrecyclingoflargevesselsarealreadyunderdevelopment.
ThescrapvolumeexpectedforgovernmentvesselsislimitedintheEU(approx.
40,000LDT/year).
ThepotentialvolumeofvesselstobescrappedfromthemerchantfleetflyinganEUmemberstateflagismuchlargerthanforgovernmentvesselsandrangefrom1.
3to2.
1millionLDT/year,notconsideringthepossiblebacklogduetohighfreightratesorthesinglehulloiltankerspeakvolumeinyear2010(thevolumetriples).
Thefewyearsfrom2000tilltodayhasshownthatthepositiveconditionsofthefreightmarkethavekeptmanyvesselstradinglongerthanitwaspreviouslyestimated.
Incaseofacoolingofthemarketthesevesselsmayrapidlyentertherecyclingmarket.
Undertheexistingre-flaggingconditionsitmustbeexpectedthataconsiderableproportionofthesevesselswillbeflaggedtonon-EUmemberstates,beforetheyreachtheirend-of-life.
Withoutanewregimeonsafeshiprecyclingthevesselswillundoubtedlybesoldtothehigh-estbidder,whichwilltranslateintothecontinuoususeofthepresentunsafescrappingproceduresinAsia.
ThescrapvolumefrommerchantfleetunderEUmemberstateflagsrangefrom1.
3to2.
1millionLDT/yearassumingnonetlossofend-of-lifevesselsduetoreflagging.
CapacityofrecyclingThegovernmentvolumeisratherlimitedandcanbeabsorbedwithoutmajorexpansionwithintheexistingcapacity.
Presently,veryfewmerchantvesselsarescrappedintheEU,andthevastmajorityofEUmemberstateflaggedves-selsarescrappedinAsiaalongwithrestoftheworld'sobsoletevesselsonthebeachesofIndia,BangladeshandPakistan.
NocapacityconstraintisexpectedforscrappinggovernmentvesselsintheEU.
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ThecapacityintheEUforsaferecyclingisinsufficientforthepotentialphaseoutvolumeofmemberstateflaggedmerchantships.
Underthepresentmarketconditionsthecapacityamountonlytosome200,000LDT/yearandpartofthisalreadyisbeingusednowforsmallervesselsandgovernmentvessels.
Thepo-tentialcapacityforrecyclingissubstantialintermsofphysicalinfrastructure:quays,skilledworkforce,disposalfacilitiesetc.
butthiswillnotbedevelopedtocaterforthemerchantfleetunlessmarketconditionsimprove.
AlmosttheentirescrappinginEuropetodayiscarriedoutaspier-breaking,wheretheshipisalignedtoaquayormooredalongthebankofariverandscrappedfromthetop,orwithaslipwaywherethebowispulledonshoreandthevesselisscrappedfromthefront.
Therehavebeencallsfortheuseofdrydockingfacili-tiesfortheentireprocessofdismantling.
However,inmanyyardssuchre-quirementwouldlimitthevolumeofvesselspotentiallyrecycledandmaybereservedforthekeelsectionallowingpierbreakingofthehullintheEU.
InsufficientgreencapacityexistsintheEU,butinfrastructureisreadilyavail-able.
Table1DemandforrecyclingandcapacityinsafeandenvironmentallysoundrecyclingEUGovernmentvesselsandfishingvesselsLDT/yearRecyclingdemand40,000ExistingEUcapacity200,000Balance+160,000CapacityneedNoextracapacityneededCertifiedfacilityinTurkey*50,000EuropeanflaggedmerchantfleetLDT/yearRecyclingdemand1,600,000ExistingEU200,000MobilisableinEU(existinginfrastructure)1,000,000Balance-400,000CapacityneedExtracapacityneededMobilisableinTurkey*600,000CertifiedacilitiesinChina*1,500,000*ThecapacityinTurkeyandChinaisnotyetfullyrecognisedassafeandenvironmentallysoundrecyclingandthefacilitiesinChinaareoutsideofOECD.
TherecyclingcapacitymostreadilyavailableisinAliaga,Turkey.
Itisesti-matedat0.
6-1.
0millionLDT/year.
SeveralofthecompaniesinAliagahaveobtainedinternationalcertificationsonenvironmentalandoccupationalhealth.
Further,sharedfacilitiesforhazardouswastemanagementareavailableatthesite.
ItisnotclearhowmuchofthetotalcapacityinAliagaiscertifiableatpre-sentandcertainmemberstateshaveexpressedreservationsregardingtherecy-clingproceduresinTurkey.
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comparabletopierbreaking,andthusdeemedacceptable,theimprovementsneededtoreachsafeandenvironmentallysoundshiprecyclingdonotappeartobeinsurmountable.
Upto1millionLDT/yearsafeandenvironmentallysoundrecyclingcapacitycanbegeneratedinTurkey.
IntheOECDareafacilitiesareavailableintheUSAalthoughtheseareusedtorecycletheNavyandMARADvesselswithacurrentcapacityof225,000LDT/year.
Untilnowthesefacilitieshavenotimportedvessels.
IntheEFTAregionseveralcompaniesoperatedecommissioningfacilitiesforoffshoreplat-formsinNorwayandsomehavealreadyrecycledships.
InAsiathecurrentlocationforsaferdismantlingisChinawhereseveralyards,whichareinternationallycertifiedonenvironmentalandoccupationalhealth,offershiprecyclingwiththepierbreakingmethod.
OnefacilityinChinahascooperatedwithaninternationalshippingcompanytoscrapvesselsundersafeconditions.
ThecombinedgreenrecyclingcapacityinChinaisestimatedtobeapprox.
onemillionLDT/year1.
Upto1millionLDT/yeargreenrecyclingcapacityisavailableinChina.
YardsinIndiahaveenteredtherecyclingmarkettoofferrecyclingcertifiedaccordingtoISOandOHSAS.
Thetablebelowincludestheidentifiedshiprecyclingfacilities,whicharecerti-fiedorauthorisedxxprocedures.
ThelistoffacilitieshasbeensplitintoEuro-peanfacilities,OECDfacilities,Asianfacilitiesandbeachingfacilities.
Regard-ingtheEuropeanfacilitiesithasnotbeeninvestigatedifthesehavebeencerti-fiedaccordingtorelevantinternationalstandards(ISO14001orOHSAS18001).
TheseareconsideredbydefinitionascompliantwithCommunityandnationallegislationandthereforeoperatingaccordingtosafeandenvironmen-tallysoundmanagementprocedures.
1InminutesfromarecentIMOseminarinZhuHai,China,theChinaNationalShipbreak-ingAssociationreportsapotentialannualcapacityof3,000,000LDTinsafeandenviron-mentallysoundrecycling.
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Table2Facilities,capacitiesandcertificationCountryFacilityAnnualcapac-ityLDTCertification/authorizationMethodGent,BelgiumVanHeyghenRecyclingS.
A.
60,000NationalauthorityPierbreakingandslipways-Gravendeel,TheNetherlandsScheepssloperijNederlandB.
V.
30,000NationalauthoritySlipwayNaples,ItalySimontS.
p.
a80,000NationalauthorityPierbreakingGrenaa,DenmarkFornaesApS25,000–30,000NationalauthorityPierbreakingGdansk,PolandGdanskshipyard.
NotavailableNationalauthorityNotavailableAliaga,TurkeyLeyalShipDismantling&Recycling100,000ISO9001,ISO14001andOHSAS18001LandingJiangyin,ChinaJiangyinChangjiangXiagangShipbreakingCompany300,000*P&ONedlloyd(nowMaersk)partnerISO14001andOHSAS18001PierbreakingJiangmen,ChinaZhongxinShipbreakingSteel&Ironcompanyltd,JiangMenCity,GuangdongProvince300,000ISO14001OHSAS18001PierbreakingJiangmen,ChinaXinhuiShuangshuiShipbreaking&Steel.
Co.
Ltd60,000ISO14001OHSAS18001PierbreakingJiangsu,ChinaXinRongRecycling&LogisticsCo.
Ltd(formerlyJiangsuChangrongSteelCo.
)>100,000ISO14001OHSAS18001PieranddockbreakingChinaGuangzhouPanyuShipBreaking&SteelRollingCo**40,000ISO14001OHSAS18001PierbreakingItiscurrentlydiscussedinIMOwhetherbeachingcanbeacceptedassafeandenvironmentallysoundshiprecycling.
BeachingisnotconsideredcompliantwiththerelevanttechnicalguidelinesoftheBaselConven-tionwhichrequire"impermeablefloorswhereverhazardousmaterialsandwastesarehandled".
InAlang,India,32yardshavereceivedISO14001andOHSAS18001certifications.
*Accordingtoinfofromyardunderupgradeto1,000,000LDT/year**Basedonwww.
nmri.
go.
jp/lca/lca_hp/pdf/36.
pdfandBIMCO(2007)AnumberoffacilitiesarenotincludedinthelistbecausetheircapacitiesareatpresentloworbecausetheyarenotopentoEUships(USFacilities).
Thefacili-tieswithlimitedannualcapacitycouldconstituteafuturecapacityincaseofupgradeandinclude:KlapeidosLaivuRemontas,Kuusakoski,andSubare,allKlaipeda,LithuaniaLiepajasMetalurgs,Liepaja,LatviaKuusakoski,Riga,LatviaHKSMetals'sGravendeel,TheNetherlandsShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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VariousyardsinGdańsk,Gdynia,Wadysawowo,KoobrzegandDzi-wnów,PolandSmedegaardenandJatopApS,bothDenmarkDesguacesdelaArena(SotodelBarco),SpainBacopoulosandSavvasPireus,bothGreeceRegardingthefacilitiescertifiedaccordingtorelevantinternationalstandards(ISO14001orOHSAS18001)itisuptotheshipownertoensurethatthefa-cilitiesmanagementsystemsincludetherelevantproceduresfortheactualscrappingactivitiesanddown-streamwastemanagement.
Further,theperform-anceofthesefacilitiesshouldbefurtherinvestigatedpriortodeliveringshipsforrecyclingatthefacilitiesandbenchmarkedagainsttherequirementsforsafeandenvironmentallysoundshiprecycling.
Aretherefeasibleoptionsinpre-cleaningTheWSRandtheBaselConventionacceptexportofvesselsnotcontaininghazardoussubstancesforrecoveryinnon-EUorOECDcountries.
Ifvesselscouldbecleanedbeforeexport(pre-cleaned)theremovalofhazardoussub-stanceswouldtakeplacewherethecapacityalreadyexists.
ThedemolitionprocesswouldthentakeplaceinexistingyardsinAsiaprovidingjobsandsteelwherethisisingreatdemand.
Itshouldhoweverberecalledthatthesafetyandworkers'healthissuesmustbeaddressedwhenconsideringtheuseofbeachingasarecyclingmethod.
But,intheoryamethodologythatcould"properlyempty"thevessel,whilestillallowingittosailunderitsownpower,wouldsolvethelegalobstaclesofexportingshipsforreuse.
Presently,itisconsideredthatonlylittleofthematerialsusedforsafetyreasonsinashipcanberemovedwithoutrenderingthevesselunsafe;andifsubstantialamountsofstructurallyandoperationallyassociatedmaterialsareremovedfromtheengineroometc.
thevesselwillnotbeabletosailunderitsownpower.
Forthepre-cleaningmethodologytobefeasible,itmaybenecessary:torelaxtherequirementsoftheBaselConventionasimplementedinWSRallowingexportofvesselsunderspecifiedconditionsortoacceptthatmethodsforthecompleteremovalofhazardousmaterialsfromthevesselwillrequiretowingtothevessel'sfinaldestination.
ThestudyhasnotexaminedthedetailsofapossibleamendmentoftheBaselConventionortheWSRtoallowexportofvessels.
Itissuggestedthattheuseofamechanismtoestablishtheexistenceanduseofappropriatedismantlinganddisposaltechnologyintherecyclingcountryshouldallowforacknowl-edgementofan"equivalentlevelofcontrol".
Anotheroptionwouldbetore-quirere-exportofhazardousmaterialstotheship'sflagstateorthecountryofownership.
Bothoptionswouldallowmoreresidualmaterialsina"properlyemptied"vessel.
Theexperiencewithpre-cleaningisstilllimitedandprimarilyrestrictedtonavalvesselsandabandonedvessels.
Thecostsofpre-cleaningde-rivedfromtheseexperiencesmaynotberepresentativeformerchantships.
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Thepossibilityoftowingemptyhullshasbeenexamined.
Statisticallytowingaddtotheriskassociatedwithtransport,butwhenconsideringemptyhullstheextrariskislessthantypicallyenvisagedsincefewerstaffareinvolvedandnocargoorbunkeroilcanbelost.
Infact,theSuezCanalAuthorityhasrecentlydemandedthatallvesselsdestinedforrecyclingbetowedinthecanaltoreducetheriskofaccidents.
Thus,towingofpre-cleanedvesselsistechnicallyfeasi-ble,butwillalsoentailadditionalcostandtheneedforincreasingthefleetoftugs.
Theexperiencewithpre-cleaningofnavalvesselsmaynotberepresentativetothemerchantfleet.
Pre-cleaningundercurrentlegislationwillentailtowingtothefinalrecyclingdestination.
Towingtorecyclingfacilitywilladdalimitedriskcomparedtoafinalvoyagewithcargo.
Willsufficientcapacitybeavailableforgovernmentvesselsandformer-chantvesselsThedismantlingmarketexpectsthememberstatestotenderdismantlingofgovernmentvesselsundereconomicallysustainableconditionsandtheneces-sarycapacityisthereforeunderdevelopment.
SomeactorsareinvestigatinghowtoestablishmorecapacityintheeventofanewinternationalorCommu-nitylegislativeregimeonshiprecyclingofmerchantvessels.
ThereappeartobenoprivateinvestmentinEuropeanend-of-lifesolutionsformerchantves-sels.
Table3EstimatedcostsofeffectsofshipdismantlinginthefourscenariosUSDperLDTReferencescenario,BangladeshPre-cleaningscenarioFullgreendis-mantling,EUFullgreendis-mantling,TurkeyorChina*Pre-cleaningcostsTowingcostsfrompre-cleaningtodismantlingsiteRiskofaccidentbytowingShipend-of-lifevalue000380-200--100-65-15380000-20-130000225Netrevenuefromrecycling380100-200-20-130225Differencetoreferencescenario-180-280250-400155*ChinaisnotanOECDmemberanddirectexporttoChinaisnotcompliantwiththeEuropeanCommunityWasteShipmentRegulation.
TheextracostsassociatedwithsaferrecyclingandthelowwagescausesthepriceofferedperLDTtodropfrommorethan400USD/LDTinBangladesh,IndiaandPakistanto200-225USD/LDTinChinaandTurkey.
Thiscorre-spondstoa"loss"ofalmost3millionUSDforatypicalPanamaxtanker,ifaShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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shipownerchoosessaferrecycling.
Tankers,bulkcarriersandcontainershipsareeasiertodismantlethanpassenger/ro-roferriesandnon-cargovesselsandthecostdifferencewillbemorepronouncedwithastructurallymorecomplexvessel.
FromastricteconomicperspectivethemostattractivealternativetobeachinginAsiaisdismantlingataTurkishsite.
TurkeyisamemberofOECD,isaPartytotheBaselConventionandisamemberoftheInternationalMaritimeOrganization(IMO).
Economically,thesecond-bestalternativeseemstobetheoptionwithpre-cleaninginEuropeandtowingtodismantlinginAsiaalthoughseriousobjectionswouldberaisedifthedangerousandhazardousworkingconditionsembeddedinthebeachingmethodusedindismantlinginAsiare-mainedunchangedTodaythecapacityfordismantlingallEuropeanowned/flaggedvesselsdonotexist,buttherearenotechnicalconstraintsforestablishingthecapacityintheEU.
However,itshouldbeunderlinedthattheEUscenarioisfarfrombeingeconomicallyself-supportingandaschemewhichensuresthatthereisarealincentivewillhavetorelyongeneroussubsidiesorapolluterpayschemenoteasilyenforced.
TheeconomicallymostfeasiblealternativetothescrappingontheIndianSub-continentistherecyclingfacilitiesinTurkey.
Pre-cleaningofvesselsinmemberstatesandexportingofhullstoistechnicallyandeconomicallypossible,butwillnotchangeunsafeworkingconditioninbreakingnations.
ShiprecyclingintheEUistechnicallypossiblealsoforlargevessels,butthecapacitywillnotbedevelopedunderthepresentmarketconditions.
WhataretheoptionsforimprovingtherecyclingofEuropeanflaggedves-selsToavoidthescrappingofshipsunderunacceptableconditionsanumberofac-tionscanbeenvisioned.
Basically,therearethreetypesofinstrumentsavailableforhandlingthissituation:Regulation.
AlthoughIMOisunderwaywithaproposedConventiononshiprecycling,theprocessofratificationislongandenforcementchal-lengesmustbeanticipated.
EUinterimmeasuresmaybeundertaken.
Economicincentives.
Anumberofincentivespromptingshipownerstochooseacceptablescrappinghavebeenproposed,includingashiprecy-clingfund.
Information.
Raisingawarenessamongshipowners,authoritiesinbreakercountries,workersandotherstakeholders.
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TheestablishedpolicyoftheEUrestson"thepolluterpaysprinciple"inthesematters.
DuetotheeaseofsaleandreflaggingofthemovableassetthereisalimitedlegalobstacleandaconsiderableeconomicincentivetochooseanAsianrecyclingyard.
Inadditiontoawarenessraisingintheindustry,afewspecifictechnicalassistances,suchascertificationandlabellingofyards,andutilisationofanumberofexistingEUprogrammesforindustrialR&Dandre-gionalorlocaldevelopment,whatisneededistheemergenceofamarketforsafeandenvironmentallysoundrecycling.
Publictenderingofthedismantlingofgovernmentvesselswillassistthis,butacommercialmarketforgreenrecy-clingofmerchantvesselswillonlyappearoncethecostdifferencebetweentheAsianbeachingfacilitiesandtheacceptablefacilitiesisdecreased.
Underthecurrentregulatoryandcommercialconditionsintheglobalshippingandrecy-clingindustriesthismayonlybeeffectivelyachievedbysubsidisingtheactiv-ity.
Table4EstimatedsubsidyneededforshipdismantlinginthethreealternativescenariosuntilentryintoforceofnewconventionPre-cleaningscenarioFullgreendismantling,EUFullgreendismantling,TurkeyCostdifferencetoreferencescenarioof380USD(USDperLDT)180-280250–400155Scrappingvolume,allvesseltypes,EUflagged(LDTperyear)1,600,000Totalsubsidyneeded,2007-2013mill.
USDperyearmill.
EURperyear290-450214-333400-640296-473250185Note:Thecalculatedcostdifferencesareassociatedwithuncertaintyandonlyprovidetheorderofmagnitudeofthedifferencetotheconventionalbeachingmethod.
Asubsidyisnotlikelytoremainapermanentfeature.
Itisestimatedthatonceaconventionhasenteredintoforceattheearliestin2013thenewgloballevelplayingfielddictatedbytheConventionwillensureanevenlevelofcontrolandtherewillbenomoreneedforthiskindoffinancialsupport.
ExistingprogrammesforindustrialR&D,regionaldevelopmentandtechnicalassistancetoselectedcountriescanbeusedforsupportingactivitiestothere-cyclingandshippingindustries.
Adirectfinancialmechanismforsupportingtherecyclingofmerchantvesselsmaygeneratethenecessarymarketforsafeandenvironmentallysoundrecy-cling.
Thestudyhas16recommendations.
RecommendationsfortheConventionanditsimplementation:1.
TheIMOconventiononshiprecyclingshouldincludeenforceableandadequaterequirementsandstandards.
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2.
Itisproposedthataninternationallyrecognisedclassification,cer-tificationandauditsystemforrecyclingyardsiscreated.
3.
Itisproposedthatamechanismforexchangeandevaluationofshiprecyclingplansisestablishedpossiblywithathird-partyveri-fication.
Particularlyregardingpre-cleaning:4.
Itisproposedtocompileexistingquantitativestandardsandde-velopapilotcaseforexportofanactualvesselpre-cleanedtothe"properlyemptied"level.
5.
ItisproposedtoinvestigatethefeasibilityofestablishingEU-basedoroverseaspre-cleaningfacilitiesservicingshipbreakinginEurope/TurkeyorAsianyardsrespectively,thusminimisingtow-ingofhulls.
6.
Itisproposedtodevelopamechanismtoestablishtheexistenceanduseofappropriatedismantlinganddisposaltechnologyinthefinalrecyclingcountrythusensuring"equivalentlevelofcontrol"toal-lowforexportofapre-cleanedvessel.
7.
Anoptionistoallowre-exportofhazardousmaterialstotheship'sflagstateorthecountryofownership.
8.
Itisproposedtoassessapilotcaseforexportofanon-pre-cleanedvesselandtreatmentatthereceivingyard,takingintoaccounttheneedforacceptabledismantlingproceduresanddisposalfacilities.
RecommendationsfortheinterimperioduptotheConvention:9.
Toconcentratethecapacityitissuggestedthattenderingofobso-letevesselsforscrappingiscarriedoutatCommunitylevel.
Thetenderingprocesscouldbeperformedbypre-qualifyingyardsandthentenderoutbetweentheseyardsonavessel-by-vesselbasis.
10.
Aknowledge-sharingprogrammeshouldbeestablishedinvolvingyards,shipowners,localauthoritiesandprofessionalknowledgebase,suchastheclassificationsocietiesandotherconsultants.
11.
TheCommissioncouldconsiderestablishingapriceintandemawardedtoanupgradedyardandaresponsibleshipowner,whosuccessfullyscrappedavesselunderappropriateconditions.
12.
Afasttrackprojectwithreferencetorecommendation2mayiniti-atethedevelopmentofaEuropeanCommunityvoluntaryclassifi-cationandlabellingofmemberstatefacilities,opentocandidatecountries,OECD/EFTAandfacilitieselsewhere,inparticularthoseinAsia,claimingsafeandenvironmentallysoundshiprecycling.
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13.
Itisproposedtoestablishademonstrationprojectforupgrad-ing/certifyingoneorseveralrecyclingyard(s)intheEU,Turkey,ChinaorIndia/Bangladesh,preferablywithademonstrationvesselscrappedunderfulldocumentationandreporting14.
ItisproposedthatallexistingvesselsunderEUmemberstateflaggedshipsandshipscallingatEUportsafteragivendate,e.
g.
January1st2010,mustcompletePartIoftheInventoryofHaz-ardousMaterialsasdevelopedbytheIMO(PartsIIandIIImustbecompletedforvesselsbeforetheirfinaljourney).
15.
RaisingawarenessmayincludetrainingofEUportofficialsandotherenforcementpersonnelinrecognisingthesignsofa"tobescrapped"vessel.
16.
Themarketwillnotdevelopasupplyofgreenrecyclingfacilitiesunderthecurrentdemandconditions.
DesigninganefficientschemewithsubsidiestoensuregreendismantlingofEUflaggedshipsmustbeevaluatedseparately.
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ForewordThisstudywasinitiatedbytheDirectorate-GeneralEnvironmentoftheEuro-peanCommission(DGENV)undercontractNo07010401/2006/443949/MAR/G4ofSeptember11th2006.
Thebackgroundisthecurrentenvironmental,technical,legalandeconomicproblemsassociatedwiththescrappingofves-sels,notablystate-ownedvessels,whichhavebeenhighlightedbyforinstancethetransferofUSend-of-lifevesselstotheUKin2003andmorerecentlytheFrenchformeraircraftcarrierClemenceauattemptedtransfertoIndia.
Thepro-jecthasbeensteeredbyDGENVinco-ordinationwithexpertsoftheEuropeanMaritimeSafetyAgency(EMSA).
ThestudywascarriedoutbyCOWIA/SinassociationwithDHIWaterandEnvironmentbyateamledbyDr.
F.
Stuer-LauridsenandMr.
K.
WintherRinggaard.
TheteamcomprisedMr.
M.
P.
Jensen(EnvironmentalEconomics),Mr.
T.
Odgaard(ShippingEconomics),Mr.
D.
F.
Olsen(RiskAssessment)andMs.
H.
Husum(EnvironmentalLaw).
Agreatnumberofrepresentativesofindustry,nationalandinternationalAu-thorities,NGOsandotherstakeholdersarethankedforhavingcontributedin-formationtothestudy.
TheviewsandopinionsexpressedinthestudyarethoseoftheTeamofexpertsthathaveconductedthestudyanddonotnecessarilyrepresenttheviewsandopinionsoftheEuropeanCommission.
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AbbreviationsandglossaryAbbreviation/acronymNameExplanationAframaxAverageFreightRateAs-sessmentTankerbetween80,000and120,000DWT.
AFRAisanacronymforAverageFreightRateAssessment.
BallastSeawatertakenintoavessel'stanksinordertosubmergetheves-seltopropertrimBCBaselConventionTheConventionontheControlofTransboundaryMovementsofHazardousWastesandtheirDisposalBIMCOBalticandInternationalMaritimeCouncilTradeorganisationrepresentingshipowners,shipbrokersandagents,andothermembersBulkCargoUsuallyahomogeneouscargostowedinbulk,andnotenclosedinanycontainerCapesizeVesselstoolargeforthePanamaorSuezCanals.
Tonnagetypi-callyupto175,000DWT.
CASConditionAssessmentSchemeConditionAssessmentSchemewhichstipulatesverificationofthereportedstructuralconditionoftheshipandthatdocumentaryandsurveyprocedureshavebeenproperlycarriedoutandcompleted.
Category1tankersSinglehullcrudeoiltankersof20,000tonsdeadweightandaboveandsinglehulloilproductcarriersof30,000tonsdeadweightandabovehavingnosegregatedballasttanksinprotectivelocations(SBT/PL).
Theyaregenerallyconstructedbefore1982.
Category2tankersSamesizeascategory1tankers,butequippedwith(SBT/PL)andprovidethereforegreaterprotectionagainstgroundingandcolli-sion.
Theyaregenerallyconstructedbetween1982and1996.
Category3tankersSinglehulloiltankersbelowthesizelimitsofcategories1and2butabove5,000tonsdeadweightDeadweight,DWTDeadWeightTonnageTheliftingorcarryingcapacityofashipwhenfullyloaded.
Thedeadweightisthedifference,intonnes,betweenthedisplacementandthelightweight.
Itincludescargo,bunkers,water(potable,boiler,ballast),stores,passengersandcrew.
DecommissionThedecisionandprocessoftakingashipoutofservice.
Oftenusedregardingnavyvessels.
DemolitionTheprocessoftakingashipapart.
Mostlyusedforonshoreopera-tion.
DismantlingTheprocessoftakingashipapart.
TermpreferredbytheBaselConventionandusedintheirguideline.
AlsoapreferredtermwithShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Abbreviation/acronymNameExplanationtheEuropeanCommission(DGEnvironment).
EHSEnvironment,HealthandSafetyProcedurestoaddresscompliancetoregulatoryrequirementsintheseareasEMASEco-ManagementandAuditSchemeEUmanagementtoolforcompaniesandotherorganisationssetoutinRegulation(EC)No761/2001EMSEnvironmentalManage-mentSystemsProceduresforenvironmentalissuesESMEnvironmentallySoundManagementSpecificallyreferringtotheBCTechnicalGuidelinesfortheEnvi-ronmentallySoundManagementoftheFullandPartialDismantlingofShips.
EUMemberstatesEuropeanUnionmembercountriesasofJanuary12007EUcandidatecountriesTurkey,CroatiaandtheFormerYugoslavianRepublicofMace-doniaDTDisplacementTonnageExpressedintonnesitistheweightthewaterdisplacedbythevesselwhichinturnistheweightofthevesselatthattime.
GasfreeGasfree(forhotwork)GasFreeCertificate-Acertificatestatingthattheairinatanker's(empty)cargotanksissafe.
GTGrossTonnageTheinternalcapacityofavesselmeasuredinunitsof100cubicfeetHandymaxHandymaxtypesaresmallfreightersandtankerswithlessthan60,000DWT.
ICSInternationalChamberofShippingTheinternationaltradeassociationformerchantshipoperatorsILOInternationalLabourOr-ganisationTheUNagencyseekingthepromotionofsocialjusticeandinterna-tionallyrecognizedhumanandlabourrightsISOInternationalOrganizationforStandardizationISOhasdevelopedthewidespreadenvironmentalstandard,ISO14000,oftenreferredtoasISO14001.
IMOInternationalMaritimeOrganisationTheUnitedNations'agencyresponsibleforimprovingmaritimesafetyandpreventingpollutionfromshipsLightweight,LDTLightdisplacementtonnesorLightweightThelightweightisthedisplacement,int,withoutcargo,fuel,lubri-catingoil,ballastwater,freshwaterandfeedwater,consumablestoresandpassengersandcrewandtheireffects,butincludingliquidsinpiping.
MARADMaritimeAdministrationUSDepartmentofTransportationAuthorityMARPOLInternationalConventionforthePreventionofPollutionfromShips,1973,asmodifiedbytheProtocolof1978relatingthereto(MARPOL73/78)MARPOLtankersCategory2tankersaccordingtoMARPOL73/78MEPCMarineEnvironmentPro-tectionCommitteeIMO'sseniortechnicalbodyonmarinepollutionrelatedmattersOECDOrganisationforEconomicCo-operationandDevel-opmentIncludesthecountriesAustralia,Austria,Belgium,Canada,CzechRepublic,Denmark,Finland,France,Germany,Greece,Hungary,Iceland,Ireland,Italy,Japan,Korea,Luxembourg,Mexico,Nether-lands,NewZealand,Norway,Poland,Portugal,SlovakRepublic,Spain,Sweden,Switzerland,Turkey,UnitedKingdom,UnitedStates.
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Abbreviation/acronymNameExplanationOHSASOccupationHealthandSafetyAssessmentSeriesOHSAS18000isanOccupationHealthandSafetyAssessmentSeries.
OftenthereferenceistothestandardOHSAS18001.
Panamax.
ThelargestacceptablesizetotransitthePanamaCanal;appliedtobothfreightersandtankers;lengthsarerestrictedtoamaximumof275meters,andwidthstoslightlymorethan32meter.
Theaver-agesizeabout65,000DWT,butsizemaygoupto>80,000DWT.
Pre-MARPOLtankersCategory1tankersaccordingtoMARPOL73/78RecyclingTheprocessoftakingashipapart.
TermpreferredbytheshippingindustryandIMO.
Whenprocedurestosafeguardtheenvironment,workers'healthandsafetyareapplied-"greenrecycling".
SBT/PLSegregatedballasttanksinprotectivelocationsBallasttankspositionedwheretheimpactofacollisionorground-ingislikelytobegreatest.
Scrapping"Neutral"wordfortheprocessoftakingashipapart.
Termpre-ferredintheUSEPAguidelineandoftenusedinthereusedmetalbusiness.
.
ShipbreakingTheprocessoftakingashipapart.
ThetermispreferredbyILO,EUandmanyofthenationalshipbreakers'associations.
SuezmaxThemaximumsizeshipthatpassthroughtheSuezCanalintermsofwidth,lengthanddraught;generally110,000-150,000DWT.
ULCCUltraLargeCrudeCarrierTankerof320,000DWTandaboveUSEPAUnitedStatesEnviron-mentalProtectionAgencyUnitedStatesGovernmentEnvironmentalAuthorityVLCCVeryLargeCrudeCarrierTankerof200,000-320,000DWTWEEEWasteElectricalandElec-tronicEquipmentE-wasteasregulatedintheEUbyDirective2002/96/EC.
WSRWasteShipmentRegula-tionRegulation(EEC)No259/93onthesupervisionandcontrolofshipmentsofwastewithin,intoandoutoftheEuropeanCommu-nity.
ImplementstheBaselConvention.
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1Introduction1.
1ShiprecyclingasaglobalactivityDismantlingofvesselswasacommonpartofaportsceneespeciallythrough-outsouthernEuropefromthelate1940stothe1960s.
LowerlabourcostsandadomesticdemandforsteelmeantthatvesselsweremorelikelytobescrappedinJapan,KoreaandTaiwanduringthelate1960s,1970sandearly1980s,butforthelast25years,theglobalcentreforshipbreakinghasbeenIndia,Bangla-deshandPakistan.
Here,theshipsarescrappeddirectlyonthebeachesorwhatareinfactvastintertidalmudflatsexposeddailybya10mtidalgauge.
ThebeachingmethodoftheIndianSubcontinentreliesheavilyonlowlabourcostsinceitinvolvesverylittlemechanisation.
Formorethan10yearsshipbreakinghasalsobeentheissueofastrongpublicdebatefuelledfirstbytheimagescapturedatChittagonginBangladeshbytheBrazilianphotographerSebastiaoSalgadoandpublishedinhisbook"Workers"from1993.
Sincethen,theauthorsofaseriesofarticlesontheconditionsinAlang,"TheShipbreakers",wereawardedthePulitzerPrizein1997,andnotleasttheeffortsoftheNGOs,inparticulartheGreenpeaceshipbreakingcam-paign,haveregularlybroughtend-of-lifeships,shipowners,shipbreakingyardsandvariousauthoritiesinthepublicspotlightandquestionedthelegalityofthepresentpractices.
TheEuropeanCommissionhasaddressedshipscrappinginseveralstudiessince2000,andinternationalbodiessuchastheInternationalLabourOrganisa-tion(ILO),theBaselConventionConferenceofthePartiesandtheInterna-tionalMaritimeOrganisationhaveincreasinglyaddressedtheissueofship-breakingorshiprecyclingwiththeaimofbringingaglobalmandatoryregimetothefield.
Also,governmentsofEUmemberstatesandOECDcountrieshaveinitiatedactionstospecificallyregulatethisissue.
Lately,afewresponsibleshipownershavebecomereluctanttosendtheirves-selstothescrappingbeachesinAsiaandareactivelyseekingalternatives.
InamuchpublicisedeventduetoadecisionoftheConseild'tat,theFrenchgov-ernmentrecalledtheformerFrenchaircraftcarrier'Clemenceau'fromitsvoy-agetoAlang,India,anditisnowawaitingrecyclinginFranceunderEuropeanstandardsofsafety,healthandenvironment.
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NoactiveshiprecyclingfacilitiesexistintheEUthatcanacceptvesselsthesizeofanaircraftcarrier,andfewcanaccommodatecommercialvesselsofquitecommonsizessuchasSuezmaxorPanamax.
Theunder-capacityandlackofspecialregulationandcertificationin'green'recyclinginEuropeandelse-wheredonotmotivatetoday'sshipownerstoacceptalossontherecyclingvalueonavessel,whenlegaloptionsexistfortradingvesselsneartheirend-of-lifeonaglobalmarketplace.
Inthepresenttradingsituation,commercialvesselsareonlyreluctantlyre-movedfromtradingsincefreightratesarehigh,andconsequently,thescrap-pingvolumeinAsiainallvesselcategoriesarealsoatalowpoint.
Eventually,itmustbeexpectedthatanaccumulatedvolumeofagingvesselswillbeobso-leteandavailableforscrappingoncethemarketcoolsoff,inadditiontothesingle-hulledoiltankersasprescribedinEUandIMOlegislation.
AfterdiscussioninthecontextoftheBaselConvention,ILOandIMO,andaJointWorkingGroupofthethreeorganisations,IMOisworkingonaproposalforanewconventiononshiprecyclingwiththeIMOastheleadorganisation.
Afirstdraftisavailable,butatpresentitmaynotadequatelyaddressseveralissuesrelevanttotheBaselConventionandtheEUWasteShipmentRegula-tion:Priorinformedconsent,theuseofpre-cleaning,therequirementsandcer-tificationsoftherecyclingfacilities.
Theshipownerorganisationshave,withsomejustification,claimedthatthemarketfor'green'recyclingwasunclearwithrespecttostandardsandapplica-blerules.
Therefore,aresponsibleshipownerwhochoosesupgradedfacilitiesinChinaorTurkeycouldnotbecertainthattherecyclingwasacknowledgedandacceptedas'green'asdefinedintheBaselConventionandILOGuide-lines2.
Today,afewshippingcompanieshavehealth,safetyandenvironmentpoliciesonrecyclingthatwillrequire'green'facilitiesifandwhenoneoftheirvesselsmustbescrapped.
OnecompanyhasusedaEuropeanfacility(BPShip-ping)andanother(P&ONedlloyd,nowMaerskLine)hascarriedoutupgradeandtraininginChineseyardsforthescrappingofseveraloftheirvessels.
However,forthemajorityofshippingcompaniestheaddedcostof'green're-cycling(inAsiaapprox.
15-25%ofsteelvalue)isequallyimportantasthelackofcertifiedrecyclingyards.
1.
2ObjectivesTheoverallobjectiveofthestudyistoprovideinformationandguidancetotheEuropeanCommissionontheissueofshipdismantlingespeciallywithrespecttotheenvironmental,technicalandeconomicaspectsoftheproblemandoftheavailableoptionstocontributetoasolutionataEuropeanlevel.
2BaselConvention:Technicalguidelinesfortheenvironmentallysoundmanagementofthefullandpartialdismantlingofships(December2002);ILO:Safetyandhealthinshipbreaking.
GuidelinesforAsiancountriesandTurkey(Octo-ber2003);ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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1.
3OutlineofthereportThroughoutthereportthestatusandoptionsareaddressedrelativetothepoliti-calandadministrativeboundariesassociatedwiththeEUandtheOECD.
Thisgenerallyleadstothefollowingidentifications:a)The27EUmemberstates;b)ThecandidatecountriesTurkeyandCroatia3plustheEFTAcountryNorway;c)TheOECDcountriesUSA,Canada,Mexico,JapanandSouthKorea;d)Asiancountries:Pakistan,India,Bangladesh,China.
Thefirstsectionofthereportcompriseschapters2,3and4,respectivelysum-marisingthejudicialandregulatoryissuesinthefieldofshiprecycling,thevolumeandprojectedphaseoutofthegovernmentandmerchantfleetsoverthecomingyears,andthecurrentandpotentialcapacityinsafeandenvironmen-tallysoundshiprecycling.
Thefollowingtwochapters5and6addressspecificchallengesregardinginter-nationalacceptanceoftheyards'claimstosafeendenvironmentallysoundre-cyclingandthetechnicalviabilityandconsequencesofapplyingthepre-cleaningconcepttoshiprecyclinginEUandAsia.
Chapters7and8analysetheeconomicsofcarryingoutshipscrappingintheEU,OECDortheAsianregion,andaddressthedriversandincentivesneededforamarketdemandtoemergeunderseveraloftheoptionspresentedearlierinthestudy.
Chapter8istheconclusions'sectionandcontainsanumberofrecommenda-tionsonhowtoachieveasolutiononaEuropeanandlocallevel.
3ThelandlockedcandidatecountryoftheformerYugoslavRepublicofMacedoniaisnotincludedShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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2InternationalgovernanceofshipdismantlingThischapterprovidesanoverviewoftheworkanddevelopmentsundertakenbytherelevantIMO,BaselConventionandILObodieswithregardtointerna-tionalgovernanceonshipdismantling.
ItcontainsareviewofthedraftIMOConventionontheSafeandEnvironmen-tallySoundRecyclingofShipsbeingnegotiatedintheorganisation'sMarineEnvironmentProtectionCommittee(MEPC)foradoptionbyadiplomaticcon-ferencein2008/2009.
Thelevelofcontrolandeffectivenessinensuringglob-allybindingminimumstandardsforsafeandenvironmentallysoundrecyclingofshipsisconsidered.
Outstandingkeyissuesareflagged.
WithaviewtocomparethecontrollevelofthedraftIMOConventionwiththatoftheexistingEUWasteShipmentRegulation,thechapteriscommencedbyanoutlineofthemainEUandinternationalinstrumentsrelevantforshipdis-mantling.
InthiscontextsomerecentexamplesofapplicationoftheWasteShipmentRegulationtoshipsfordismantlingareprovided.
2.
1ExistingEUandinternationalinstrumentsrelevantforshipdismantlingAbroadrangeofEUlegislationisapplicabletoend-of-lifeshipswhereitsetsupbindingenvironmentalandsafetyrequirementsrelatedtothedismantlingactivitiesthemselvesaswellasthetransferofend-of-lifeshipsfordismantlingfromandtotheEU.
TheCommunitywastelegislationappliestothemanagementofshipswhichhavebecomewaste.
TheWasteFrameworkDirective(Directive2006/12/EConwaste4),setsoutanumberofrequirements,includingsafeguardsforenvi-ronmentalprotectionduringrecoveryordisposal,planningandpermittingre-quirements,record-keepingandperiodicinspections.
Thisdirectivealsolaysdownthedefinitionof'waste'initsArticle1(a)as"anysubstanceorobjectinthecategoriessetoutinAnnexIwhichtheholderdiscardsorintendsorisre-quiredtodiscard".
4Directive2006/12/ECoftheEuropeanParliamentandoftheCouncilof5April2006onwaste,OJL114,27.
04.
2006,p.
9.
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Theshipmentofend-of-lifevesselswithintheEUorbetweenitsMemberStatesandthirdcountriesarecurrentlyregulatedbyRegulation(EEC)No259/93onthesupervisionandcontrolofshipmentsofwastewithin,intoandoutoftheEuropeanCommunity5(hereinaftertheWasteShipmentRegula-tion)6.
TheWasteShipmentRegulationdetermineswhichprocedurestoapplybeforeawastecanbeshippedwithin,intoandoutoftheCommunityandislargelybasedontheUnitedNations'BaselConvention,asamended7andtheOECDDecisionC(2001)107onrevisionofdecisionC(92)39/finalonthecontroloftransboundarymovementsofwastedestinedforrecoveryoperations.
TheBaselConventionestablishesacontrolprocedurefortheexportandimportofhazardouswastebetweenthepartiesoftheconvention.
Theprocedureisbasedonpriornotificationoftheexportandimportandwrittenconsentfromtheconcernedauthoritiesbeforetheimportorexporttakesplace.
ToensurethattheStateofimporthasthenecessaryinformationtomakeanin-formeddecisionwhethertoacceptorrejectanimportofwaste,theBaselCon-ventionrequiresthatcertaininformationisprovidedtotheStateofimport.
ThisinformationislistedinAnnexV,AtotheConventionandincludesdetailedin-formationofthewasteinquestion,proposedmethodsoftransportationanddis-posal,aswellasevidenceofacontractbetweentheexporterandthedisposer.
Confirmationisalsorequiredthatthedisposalcontractspecifiestheenviron-mentallysoundmanagementofthewaste.
TheBaselConventionfurthermoreimposesanobligation(Article4,para2)oneachpartynottoallowexportofhazardouswasteorotherwasteandtopreventimportofsuchwaste"ifithasreasontobelievethatthewasteinquestionwillnotbemanagedinanenviron-mentallysoundmanner".
TheConventionthusseekstopreventthatwastebedepositedinaStatethathasnotconsentedtosuchatransactionorwhichdoesnothavethecapacitytodealwiththewasteinanenvironmentallysoundman-ner.
TheBaselConventionalsosetsoutspecificstepstobetaken(Article8)whenthenotificationprocedurehasbeencompliedwith,butthedisposalcannotbecompletedinaccordancewiththetermsofthedisposalcontract.
TheConven-tionplacestheresponsibilityontheStateofexport,whichmustensurethatthewasteistakenbackbytheexporter,ifalternativearrangementscannotbemade5Regulation(EEC)No259/93of1February1993onthesupervisionandcontrolofshipmentsofwastewithin,intoandoutoftheEuropeanCommunity(OJL30,6.
02.
1993,p.
1).
6AnewRegulation(EC)No1013/2006onshipmentsofwastewillreplacethecurrentregulationinJuly2007.
ThenewWasteShipmentRegulationimplementsDecisionoftheOECDCouncil,C(2001)107/finalconcerningtherevisionofDecisionC(92)39/finalonthecontroloftransfrontiermovementsofwastedestinedforrecoveryoperations.
ThenewWasteShipmentRegulationalsoaddressesproblemsencounteredintheapplication,ad-ministrationandenforcementofthe1993Regulation.
7TheBaselConventionof22March1989onthecontroloftransboundarymovementsofhazardouswastesandtheirdisposal,asamended.
TheBaselConven-tionandOECDDecisionC(92)39arethemainpillarsoftheRegulation-theConventionanditscontrolprocedureinbriefShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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forenvironmentallysounddisposalofthewastewithin90daysfromthetimetheimportingStateinformstheStateofexportandtheBaselConventionSecre-tariatoftheinabilitytocompletethedisposalincompliancewiththecontract.
TheConventioncontainsalistofhazardouswastesandalistofnon-hazardouswastes.
Thepartiestotheconventionmayunilaterallydesignateotherwastesashazardous.
ItisanimportantfeatureoftheBaselConventioncontrolmechanismthatitestablishesatrackingsystembywhichtransboundarymovementsaremoni-toreduptotheissueofthefinalcertificateofdisposal.
ItshouldbenotedthatdisposalinthecontextofBaselConventionincludesop-erationsthatleadtoresourcerecovery,recycling,reclamation,directreuseoralternativeuses.
In1995,anamendmenttotheBaselConventionwasadoptedbanningallex-portsofhazardouswastedestinedforrecoveryfromOECDorEUmemberstocountriestowhichtheOECDdecisiondoesnotapply.
8Thebanamendmenthasnotcomeintoforceyet,asnotsufficientpartieshaveratifiedit.
TheEUhasunilaterallyimplementedtheban(CouncilDecision97/640/EC)meaningthattheexportsofhazardouswastefromtheEUtonon-OECDcoun-triesarebanned.
Articles14and16oftheRegulationthusbantheexportofhazardouswastetonon-OECDcountries.
Noexemptionsarepossible.
AnnexVtotheregulationdefinesthewastesthatfallunderthisexportban.
End-of-lifeshipsarenotexplicitlylistedinAnnexV.
However,unlessashiphasbeenbuiltveryrecentlyitwouldinmostcasescontainhazardoussub-stanceslistedinAnnexV(e.
g.
asbestosunderentriesA2050,170601and170605orPCBsunderentries160109,160209and160210)andwouldthere-forebecoveredbytheexportban.
Theexportandimportofnon-hazardouswastesarealsocoveredbytheWasteShipmentRegulation.
Fornon-hazardouswastedestinedforrecoveryandcon-tainedinthe"greenlist",itallowsasamainrulethatthedestinationcountryoutsidetheOECDdetermineswhetheritwantstoacceptorbantheimportofwaste.
9Atinternationallevel,non-hazardouswastesforrecoveryarecoveredbyanOECDDecision10andarenotwithinthescopeoftheBaselConvention.
AnnexIItotheEUWasteShipmentRegulationlistsall"green"non-hazardouswastesandimplementsinthisregardtheOECDDecision.
PursuanttothisAn-nexII,shipsareconsiderednon-hazardousiftheyfallundertheentryGC0308DecisionIII/1oftheThirdConferenceoftheParties.
9TheWasteShipmentRegulationprovidesasintroductiontoAnnexIIthat"regardlessofwhetherornotwastesareincludedonthislist,theymaynotbemovedasgreenwastesiftheyarecontaminatedbyothermaterialstoanextentwhich(a)increasestherisksassoci-atedwiththewastesufficientlytorenderitappropriateforinclusionintheamberorredlists,or(b)preventstherecoveryofthewasteinanenvironmentallysoundmanner.
"10DecisionC(2001)107/FinaloftheOECDCouncil.
-allEUexportofhazardouswastetonon-OECDcountriesisbanned-EUexportofnon-hazardouswastefordisposaltoOECDotherthan…isbannedShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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'vesselsandotherfloatingstructuresforbreakingup,properlyemptiedofanycargoandothermaterialsarisingfromtheoperationofthevessel,whichmayhavebeenclassifiedasdangeroussubstanceorwaste'.
Whattheterm'properlyemptied'meansisnotpreciselydefinedintheOECDdecision.
AnassessmentofhowtheOECDdecisionterm"properlyemptied"maybeinterpretedbothlegallyandtechnicallyisprovidedinChapter6ofthisreport.
Itshouldbenotedthatexportofnon-hazardouswastedestinedfordisposalinOECDcountriesotherthanEFTAcountrieswhichalsoarePartiestotheBaselConventionisbanned(Article14).
ArecentDutchjudgement(of21February2007)intheso-calledOtapancaseruledthatexportofshipsfordismantlingwhichrequiresasafirststeptheremovalanddisposalofhazardousmaterialssuchasasbestosandPCBthatcannotberecycled,constitutesanexportfordis-posal.
TheimplicationoftheDutchOtapanruling,ifappliedinothercases,isthatonlyshipswhichhavebeenproperlyemptiedcanbedismantledinOECDcountriesotherthanEUandEFTAcountries.
Thejudgementisfurtherana-lysedbelow.
Tosumup,theCommunitylegislationonwaste,inparticulartheWasteShip-mentRegulation,setstherequirementsatEUlevelformanagementandship-mentsofend-of-lifevessels.
TheexportfromMemberStatestonon-OECDcountriesofend-of-lifevesselsconsideredashazardouswasteisbannedac-cordingtotheUnitedNations'BaselConventionasamended.
Thebanisle-gallybindingintheEUaccordingtotheWasteShipmentRegulation.
ItfollowsfromArticle1(a)ofDirective2006/12onwasteandArticle2(a)oftheRegula-tionthatashipbecomeswastewhenitisdiscardedorisintendedorrequiredtobediscarded11–meaningfromthemomentthatitistheintentionoftheownernottouseitasashipanymore.
Ashipdestinedfordismantlingisthustobeconsideredawaste.
Whethertheend-of-lifeshipisconsideredas'hazardouswaste'dependsonthevessel'scontentsofhazardoussubstances,andwhetherithasbeen'properlyemptied'ofsuchsubstances.
11TheBaselConventionandtheOECDDecisionC(2001)107onrevisionofdecisionC(92)39/finalonthecontroloftransboundarymovementsofwastedestinedforrecoveryoperationscontainssimilarwastedefinitions:-TheBaselConventionArticle2(1):""Waste"aresubstancesorobjectswhicharedis-posedoforareintendedtobedisposedoforarerequiredtobedisposedofbytheprovi-sionsofnationallaw".
-OECDDecisionC(2001)107,ChapterII,A(1):"WASTESaresubstancesorobjects,otherthanradioactivematerialscoveredbyotherinternationalagreements,which(i)aredisposedoforarebeingrecovered;or(ii)areintendedtobedisposedoforrecovered;or(iii)arerequired,bytheprovisionsofnationallaw,tobedisposedoforrecovered".
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2.
2RecentcasesofapplicationoftheWSRtoshipsfordismantlingThesubjectiveelementofdefinitionofwaste(theholder'sintentiontodiscardit)sometimeshasmadeitdifficulttoeffectivelyapplyandenforcetheWasteShipmentRegulationand/ortheBaselConventiontoend-of-lifeship.
OnesuchexampleisthecaseoftheDanishferryKongFrederikIXbeingsailedtoIndiafordismantling.
InFebruary2005theDanishMinistryofEnvironmentbecameawarethata51yearoldDanishferrynamedKongFrederikIX,laterrenamedFrederikandaf-terthatRicky,wastobesoldpossiblyforrecyclinginIndia.
Italsobecameknownthattheshipcontainedasbestos.
WhentheshipwassolditwasdockedinDenmark,butregisteredinSt.
VincentandtheGrenadines.
Theformerowneroftheship,aswellasthenewowners,claimedthattheshipwassoldallegedlytobeputinserviceintheMiddleEastasacargoship.
TheDanishauthoritiesrequestedtheinvolvedpartiestoproducedocumentationonthis.
Asdeclarationsanddocumentationforthisactivitywereproduced,thenationalcompetentauthorityclassifiedtheshipasanon-wasteandtheshiplefttheDan-ishporton16March2005.
However,afterhavinglefttheDanishportandDanishwaterstheshipsaileddirectlyforrecyclinginIndia.
TheshipreachedIndiaon22April2005.
Denmarkisoftheopinionthattheexportofthisshipshouldberegardedasanexportofhazardouswaste,andassuchfallsundertheBaselConvention.
Fur-thermore,DenmarkbelievesthatastheexportingState,ithasaresponsibilitytore-importtheship.
Indiadidnotsharethisopinion.
DenmarkwasnotabletotakeactionwhentheshipwasanchoredintheDanishport,sincethenewownerassuredbyaswornstatementthattheshipwasgoingtocarrytrailersasro-rocargo.
Bythisswornstatementitwasbelievedthattheshipcouldnotbeclassi-fiedaswasteandhencecouldnotbedetained.
TheshipwassubsequentlydismantledinSeptember2005inIndia.
Whetherthenewownerdecidedtodismantletheshipwhiletheshipwasan-choredintheDanishharbour(andassuchprovidedtheDanishauthoritieswithfalseinformation),orwhetherthisdecisionwastakeninDanishwatersorin-ternationalwaters,ithasbeenarguedthatthiscaseshowsthatweneedanen-forceableregimeforshipdismantling12.
TheWasteShipmentRegulationhaseffectivelybeenappliedinanumberofcasesofexportofshipsfordismantlingfromEUMemberStates.
ThiswasthecaseoftheClemenceau,wheretheFrenchaircarrierwassenttoIndiaforrecy-cling.
ItwasmadeknowntotheCommissionthatthevesselhadnotbeenfullyremovedofitshazardoussubstances,especiallyasbestos.
TheCommissionre-questedadditionalinformationfromtheFrenchgovernmentandconsideredlaunchinginfringementprocedureagainstFrancerejectingFrance'sargument12SeeIMOMEPC53/3/7Proposalforanenforceablelegallybindingsystemfortherecyclingofships,submittedbyDenmark.
TheDanishferryKongFrederikIXTheClemenceaucaseShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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thattheClemenceauisnotcoveredbyEUwasterulesbecauseitisawarship.
Subsequently,theFrenchgovernmentrecalledtheClemenceauinordertopre-pareitforsaferecyclingfollowingarulingfromFrance'shighestadministra-tivecourtruledthatadecisiontosendittoIndiafordismantlingwasillegal13.
InthecontextoftheWasteShipmentRegulation,thedistinctionbetweendis-posalandrecyclinghasbeenakeyissueinseveralcases.
MostrecentlyaDutchCourt(theAdministrativeJurisdictionDivisionoftheCouncilofState)on21February2007intheso-calledOtapancaseruledthatexportofshipsfordis-mantlingwhichrequires,asafirststep,theremovalanddisposalofhazardousmaterialssuchasasbestosandPCBthatcannotberecycled,constitutesanex-portfordisposal.
ThechemicalstankerOtapanlefttheNetherlandsforTurkeyattheendofJuly2006.
Asthevesselhadmoreasbestosonboardthanspecifiedinthenotifica-tion,Turkeyrefusedtoallowittoenteritsterritorialwaters.
TheDutchauthori-ties(StateSecretaryforHousing,SpatialPlanningandtheEnvironment)thendecidedthattheshipshouldreturntotheNetherlands.
Theproposedshipmentwasthereforenotcompleted.
ItwasapparentfromthedocumentsthatitwasproposedtosendthevesselbacktoTurkeyoncethequantityofasbestosaboardhasbeenbroughtintolinewiththenotification.
TheDutchCourtruledthat"thenotificationform[…]statesthattheproposedshipmentrelatestoadecommissionedtankerwithasbestos-containingmaterialonboard.
ThisoperationisdescribedontheformasrecoveryasreferredtoinCategoryR4ofAnnexIIBtotheDirective.
Aplanforthescrappingoftheshipwasattachedasanannextotheform.
IntheDivision'sopinion,itcanbein-ferredfromthisthat,contrarytowhatthedefendantsubmittedatthehearing,thetreatmentofthewastespecifiedinthenotificationisaprocessconsistingofseveralstages.
Thescrappingplanstatesthatthefirstpartoftheoperationistoremovetheasbestosintheship.
Itfollowsfromtheplanthattheremovaloftheasbestosisnecessaryinordertoenabletheshiptobescrapped.
Theplanalsoemphasisesthatnootherworkontheship,forexampletheremovalofliquidsandgases,shouldstartuntiltheasbestoshasbeenremoved.
InviewoftheabovetheDivisionconsidersthatthewastetreatmentprocessiswronglyclassi-fiedonthenotificationformasarecoveryoperationasreferredtoincategoryR4ofAnnexIIBtotheDirective.
NoristhisalteredbythefactthatsubstancesobtainedfromthedismantlingoftheshipwillsubsequentlybetransferredfromtheSimsekleryardtothemetalworkingindustryforrecycling,whichcouldpossiblybeclassifiedasarecoveryoperation.
Inthesecircumstancesitmustbeconcludedthatthedefendantwronglyfailedtoobjecttotheproposedshipmentonthegroundofanincorrectclassificationonthenotificationform".
TheimplicationoftheDutchOtapanruling,ifappliedinothercases,isthatonlyshipswhichhavebeenproperlyemptiedcanbedismantledinOECDcountriesotherthanEUandEFTAcountries,otherwisedismantlingofEUshipscanonlytakeplacewithintheEU.
13SeeDecisionof15February2006bytheFrenchConseild'Etat,No288801-288811,at:http://www.
conseil-etat.
fr/ce/jurispd/index_ac_ld0607.
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2.
3WorkbyIMO,BaselandILObodiesTheproblemofshipdismantlinghasbeendiscussedformanyyearswithintheinternationalorganisationsinvolved:theInternationalMaritimeOrganisation(IMO),theInternationalLabourOrganisation(ILO)andtheBaselConvention,atreatyundertheauspicesoftheUnitedNationsEnvironmentProgramme(UNEP).
Allthreeorganisationshavedevelopednon-bindingtechnicalguide-linesforshiprecycling14.
TheguidelinesandtheirimpactonshiprecyclingarepresentedinChapter5.
AJointILO,IMOandBaselConventionWorkingGrouponShipScrappinghasbeenestablished.
Ithasheldtwomeetingsin2005.
AtthemeetingstheJointWorkingGrouphasdiscussedaco-ordinatedapproachtotheissueinor-dertoavoidduplicationofworkandoverlappingofroles,responsibilitiesandcompetenciesbetweenthethreeorganizations.
TheGrouphasundertakenacomparisonofthetechnicalguidelinesofthethreeorganisations.
Ithasencour-agedcollaborationintheirtechnicalcooperationactivitiesandhasidentifiedactivitiesthatcouldpromoteimplementationoftheguidelines.
TheJointWork-ingGrouphasfurthermoreaddressedhowacoordinatedapproachtoallrele-vantaspectsofshipscrappingmaybestbeundertaken.
Inthiscontext,thecon-ceptsuchasenvironmentallysoundmanagementandpriorinformedconsenthasbeendiscussedandhas,asfurtherelaboratedbelow,discussedaninitialcomparisonbetweentheBaselnotificationprocedureandtheproposedreport-ingsystemunderthedraftIMOConventionontheSafeandEnvironmentallySoundRecyclingofShipsbeingnegotiatedintheorganisation'sMarineEnvi-ronmentProtectionCommittee(MEPC)15.
2.
4ReviewofthedraftIMOConventionSince2005,theIMOhasbeenworkingtowardsabindinginternationalregimeforcleanshipdismantling16.
AdraftConventionontheSafeandEnvironmen-tallySoundRecyclingofShipsisbeingnegotiatedintheorganisation'sMarineEnvironmentProtectionCommittee(MEPC)foradoptionbyadiplomaticcon-ferencein2008/2009,toenterintoforcesomeyearslater.
14BaselConvention:Technicalguidelinesfortheenvironmentallysoundmanagementofthefullandpartialdismantlingofships(December2002);ILO:Safetyandhealthinshipbreaking.
GuidelinesforAsiancountriesandTurkey(October2003);IMOguidelinesonshiprecycling(December2003).
15ILO/IMO/BCWG2/8onEnvironmentallySoundManagementandILO/IMO/BCWG2/8/2onPriorInformedConsent.
16Atits24thsession,theAssemblyoftheInternationalMaritimeOrganization(IMO),byitsresolutionA.
981(24),mandatedtheMarineEnvironmentProtectionCommittee(MEPC)todevelopanewlegally-bindinginstrumentonshiprecycling.
Initsresolution,theIMOAssemblynoted,amongotherthings,therolesoftheInternationalLabourOrgani-zationandtheBaselConventioninmattersrelatedtoshiprecycling.
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Itaimsata"cradletograve"approachtoshiprecycling,withaviewtoavoid-inghazardousmaterialsinnewshipsandremovingthemfromexistingshipsduringtheirperiodofoperation.
Itwillsetoutspecificrequirementsfortheshiprecyclingfacilitiesincludingauthorisationofthefacilitiesaswellasare-portingsystem.
Technicaldetails,whichalsocovertheenvironmentallysoundmanagementofshiprecyclingfacilities,willbesetoutinrecommendedguide-linessupplementingtheConvention.
ThedraftConvention(asofJanuary2007)hasanannextowhichcontainsregulationsdividedinfourchapters.
Chapter1containsgeneralprovisions.
Chapter2containsrequirementsforships,dividedintothreeparts(PartAondesign,construction,operationandmaintenanceofships;PartBonpreparationforshiprecycling;andPartConsurveysandcertification).
Chapter3containsrequirementsforrecyclingfacilities,whileChapter4containsreportingre-quirements.
Presentlytherearetwoappendices,thefirstonebeingparticularlyimportantasitcontainsthelistofhazardousmaterialswhicharecontrolledbytheConvention,whilethesecondappendixprovidesstandardformatsforrele-vantcertificatesandotherdocuments.
Alargenumberofprovisionsarestilltobeagreedto.
Therearethusaratherlargenumberofsquarebrackets.
ThestructureofthedraftConventionislinkedtotheproceduresforamendingtheConventionasdefinedinArticle18,whichspecifyexplicitacceptancebytwothirdsofthePartiestotheConventionforamendingArticlesandatacitprocedureforamendingtheregulationscontainedintheAnnex,wherebyamendmentswouldbedeemedacceptedunlessonethirdofthePartiestotheConventionnotifytheirobjection.
Thefollowingguidelinesareforeseentobedeveloped:GeneralGuidelinesforcommunicationofinformation.
GuidelinesforshipsGuidelinesforthedevelopmentofInventoryofhazardousmaterials.
Guidelinesforthesubmissionofaproposaltocontrolhazardousmaterials.
Guidelinesforsurveysandcertification.
Guidelinesforinspectionofships.
Guidelinesforestablishinggas-free-for-hot-workconditions.
GuidelinesforshiprecyclingfacilitiesGuidelinesforauthorizationofshiprecyclingfacilities.
Guidelinesforsafeandenvironmentallysoundshiprecycling.
GuidelinesforthedevelopmentofShipRecyclingPlan.
BrieflyaboutthedraftIMOShipRe-cyclingConvention-amendmentsGuidelinesShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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InordertofurtherdevelopthedraftConventionanditsguidelines,MEPC55inOctober2006agreedtoconveneanintersessionalcorrespondencegroupandalsoanintersessionalworkinggroup.
TheintersessionalCorrespondenceGroup,underthecoordinationofNorwaywouldreportontheoutcomeofitsworktotheintersessionalWorkingGroupscheduledtomeetinMay2007intheUKwhichwouldprovideareportonthedraftconventionandrelatedguide-linesforfurtherconsiderationbyMEPC56(July2007).
FollowingMEPC56,thetwenty-fifthregularsessionoftheAssembly(3-14December2007)willdecideontheholdingoftheDiplomaticConference.
MEPC57inMarch2008isscheduledtoestablishaWorkingGroupandpossi-blytofinaliseworkonthedraftConvention.
TheoneweekDiplomaticConfer-encemaybeheldsometimebetweenFebruaryandApril2009.
Controversialissues,whichwillbediscussedbyIMOworkinggroupsin2007,includethequestionastowhetherreferenceshouldbemadetorulesandstan-dardsoutsidetheframeworkofIMO,theenvironmentalbaselinestandardforshiprecyclingfacilities,futurereportingrequirements(inparticularwhetherstate-to-statenotificationshouldbenecessaryasundertheBaselConvention)andthetypeofcompliancemechanismtohelpwithimplementationoftheConvention.
InthecontextoftheBaselConvention,thekeyissueunderdiscussioniswhethertheproposedShipRecyclingConventionwillensureanequivalentlevelofcontrolandenforcementasundertheBaselConvention.
The8thCon-ferenceofthePartieson1December2006reiteratedthisdemandandstated,amongotherthings,thatthefuturelegalinstrumentshouldgenerateconditionsofshipdismantlingthatprotectworkersandtheenvironmentfromtheadverseimpactsofhazardouswastesandunsafeworkingpractices.
TheCouncilinitsconclusionsof21November2006"emphasisedthatshipthatarewastewillcontinuetofallundertheEUWasteShipmentRegulationaslongasthereisnointernationallybindingandeffectivelegalinstruments,whichwhileaddressinganyspecialcharacteristicsofships,guaranteeanequivalentlevelofcontrolandenforceabilityasestablishedundertheBaselConvention".
TheCouncilalsounderlinedthatthefutureIMOShipRecyclingConventionshould"generaterealchangesintheconditionsunderwhich"end-of-life"shipsaredismantled,soastoprotectworkersandtheenvironmentfromtheadverseimpactsofhazardouswasteanddangerousworkingpractices".
Inthefollowing,thelevelofcontrolandeffectivenessinensuringgloballybindingminimumstandardsforsafeandenvironmentallysoundrecyclingofshipsisconsidered.
Focusisplacedonthedraftprovisions(asofJanuary2007)whichhavebeenagreedtoandkeyoutstandingissuesareflagged.
Accordingtothecurrentdraft,theConvention-inlinewithotherIMOinstru-ments-willnotapplytosmallervesselsoflessthan500grosstons,nortowar-ships,navalauxiliaryorothervesselswhicharestate-ownedor-operatedandusedonlyonnon-commercialgovernmentservice.
Itisprovided,however,that"eachPartyshallensure,bytheadoptionofappropriatemeasures,thatsuchNextstepsinthene-gotiationsofthedraftIMOConven-tionanditsguide-linesKeyoutstandingissuesThelevelofcontrolandeffectiveness-scopeShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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shipsactinamannerconsistentwiththisConvention,sofarasisreasonableandpracticable.
"ThedraftConventionsetsoutanumberofmandatoryrequirementsforshipswithaviewtoavoidhazardousmaterialsinnewshipsandremovingthemfromexistingshipsduringtheirperiodofoperation.
EachnewshipshallthushaveonboardanInventoryofHazardousMaterials(Regulation7).
TheinventoryshallbeapprovedbytheAdministrationtakingintoaccounttheguidelinesde-velopedbyIMO.
Theinventoryshallbespecifictoeachshipandshallatleast:identifyhazardousmaterials,theirlocationandapproximatequantities;consistofPartI:materialscontainedinship'sstructureandequipment;clarifythattheshipdoesnotcontainanymaterialswhichareprohibitedunderregulation4.
Theprovisionsforinventoryforhazardousmaterialsforexistingshiphavenotyetbeenagreedto.
Therearecurrentlytwoalternatives.
Theobjectiveoftheinventoryofhazardousmaterialsistoprovidespecificinformationontheloca-tionandquantitiesofpotentiallyhazardousmaterialsonboardeachshipsoastoprotectthehealthandsafetyofworkersandalsotopreventenvironmentalpollutionattherecyclingfacilities.
InventorieswillconsistofthreeParts:PartI:Materialscontainedinstructuresandequipmentoftheship;PartII:Operationallygeneratedwastes:andPartIII:Stores.
Theinventoryissupplementedbyasurveyandcertificateregime(Article5andRegulations11-15).
Presently,thedraftConventionmakesprovisionsforthefollowingsurveys:oneinitialsurvey;fornewshipsaninitialsurveywouldtakeplacebeforetheshipentersservice,whileforexistingshipsthesurveywouldtakeplacebeforetheinventoryisissued(existingshipsaredefinedasshipsbuiltbe-foretheConventionentersintoforce);periodicalsurveys,onthebasisofafiveyearcycle,verifyingcontinuingcompliancewiththeConventionandensuringthatanyrelevantalterationsarereflectedontheinventory;additionalsurveys,whichtheshipownermayrequesttotakeplaceathisoptionafteralterationstothestructure,machineryorequipmentoftheship;andonefinalsurveypriortotheshipbeingtakenoutofservice,sothatallthreePartsoftheinventoryarecompletedandchecked,theRecyclingPlanisexaminedandcheckedagainsttheinventory,andtheReadyforRecy-clingCertificateisissued.
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Themostimportantrequirementsforrecyclingfacilitiesaremandatorydevelopmentofshiprecyclingplan.
Theplanshallbedevel-opedbytherecyclingyardtospecifythemannereachshipwillberecy-cled,dependingonitsparticularsanditsinventory.
Itshalltakeintoac-countthenonbindingguidelinesdevelopedbyIMO;theintroductionoftheInternationalReadyforRecyclingCertificate,tobeissuedtotheshipfollowingitsfinalsurveyverifyingshiprelatedstate-mentsontheRecyclingPlan;theauthorizationofrecyclingfacilitiesbytheirStates,inaccordancewiththerequirementsoftheConvention;andaStatementofCompletionofShipRecycling,issuedbytherecyclingfa-cilityandreportingcompletionofrecyclingofanindividualshiptothere-cyclingStateauthoritiesandtotheflagAdministration.
Theissueofpre-cleaninghasbeenadivisiveissue.
UnderthedraftConvention,priorremovalofhazardousmaterialsmaynotberequirediftherecyclingfacil-itychosenisfullyauthorisedtomanagethetypeoramountofhazardousmate-rialscontainedintheship.
ThedraftConventionseekstomatchtheindividualship'srequirementsandthecapabilitiesoftherecyclingyardbymeansofaRe-cyclingPlanandanInternationalReadyforRecyclingCertificate.
However,thereisstillaneedtoclarifythat,incasethefinalrecyclingfacilityisnotcapa-bleofmanagingcertainhazardousmaterials,theownerofanend-of-lifeshipmustselectanotheryardorremovethematerialsforsafedisposalorrecoverybeforehand.
Asindicatedabovethefuturereportingrequirements(inparticularwhetherstate-to-statenotificationshouldbenecessaryasundertheBaselConvention)andthetypeofcompliancemechanismtohelpwithimplementationoftheConventionaresomeofthecontroversialissuestobediscussedattheworkinggroundmeetingsin2007andkeyoutstandingissuesassessingthelevelofcon-trolandenforcement.
Whilethemandatorysystemforinventoryofhazardousmaterialsandtheasso-ciatedsurveyandcertificateregimesetsoutcomprehensiverequirementswhichmayeffectivelybeappliedtoallshipsandthusgeneratechangeonthegroundfortheconditionsunderwhichend-of-lifeshipsaredismantled,thecurrentdraftdoesnotaddressinoperationaltermshownewsurveyandcertificatewillbeissuediftheshipchangesownerand/orflag.
Thisisparticularrelevantiftheshipchangesownerjustpriortotherecycling.
Anumberofprovisionsarerelevantforcontroloftherecyclingfacilities(Arti-cles4(2),6,7,8(1),9(4),10(1),12(2)and(6),13bis,17and18(2).
Severaloftheseprovisionsareofagenericnature.
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Facilities,thepresentdraftIMOShipRecyclingConventiondoesnotprovidefordisseminationofinformationonthewebonIMOwhichoftenisseenasaneffectivemeantofacilitatecomplianceandenforcement.
FinallywhiletheIMOConventionmayeventuallyprovideforgloballybindingminimumstandardsforsafeandenvironmentallysoundrecyclingofships,itshouldbenotedthatIMOconventionsonaveragetakesixyearstoenterintoforce.
TheConventionwouldthereforemostlikelyenterintoforcein2013,attheearliest.
Thepeakforphasing-outsinglehulltankersisexpectedaround2010.
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3UpdatedstatusandprojectionsforEuropeanend-of-lifeshipsuntil20203.
1IntroductionThenumberandtonnage(LDT)tobescrappeduntil2020isassessedbelowandastatusisprovidedforthehistoricaldevelopmentswithaspecialemphasisontheyears2004-2006.
Foranalyticalpurposes,thescrappedvesselshavebeensplitintoeighttypesegments.
Thesegmentationisbasedonacategorisationofthe"subtypes"usedinClarkson'sdatabasesconsistentwiththemethodologyusedintheCOWI/TRENstudy(2004).
Theassessmentoffuturedecommissioningvolumesalsoincludestwoaddi-tionaltypesFishingvesselsandWarshipsandtheassessmentisthereforemadeforthefollowing10'vesseltypes':1.
(Singlehull)Oiltankers2.
Othertankers3.
Bulk4.
Container5.
Gas6.
Passenger/ro-ro/vehicle(includingferries)7.
Othercargovessels8.
Non-cargovessels9.
Fishingvessels10.
WarshipsNodistinctionismadebetweenthehulltypesofoiltankers.
Detailsofthetypeandgeographicalsegmentationaregiveninappendix1oftheCOWI/TRENstudy.
3.
2HistoricaldecommissioningvolumesThischapterdescribestherecordedscrappingactivityfrom1994-2006,withaspecialemphasisontheyears2004-2006.
AnumberofmethodologydetailsandassumptionsaregiveninAppendixA.
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3.
2.
1Totalvolumes1994-2006Theestimatedlevelofhistoricalscrappingaresummarisedinthefigurebelow.
051015202530351994199519961997199819992000200120022003200420052006MillionLDT/DWT0100200300400500600700NumberofvesselsmLDTmDWTNo.
Figure3-1Totalhistoricalshipscrappingvolumes,alltypes(MillionLDT,MillionDWTandnumberofvessels)Note:Figuresfor2003and2006havebeenconvertedtofullyear.
Source:Clarkson(2006)andCOWI/TREN(2004).
From1994-2006,approximately5,600shipshavebeendemolishedworldwide.
Therehavebeenconsiderablevariationsintheactivitylevelovertheyears.
Theshipscrappingactivitypeakedin1999with600shipsbeingscrappedrepresent-ingapproximately6.
4millionLDT,whilethescrappingactivityin2005reachedan"alltimelow"ofonlyapproximately1.
5millionLDTbeingscrapped.
3.
2.
2VolumesbyshiptypeThehistoricalscrappingvolumesbyshiptypeareshownintablebelow.
Thevolumesscrappeddeclinedconsiderablyfrom2003to2004and2005forallmajorshiptypesduetohistoricallystrongfreightmarkets.
Itappears-onthebasisofdataforthefirsthalfof2006-thatscrappingvolumesareincreas-ingduetorelativelystrongdropsinthefreightrates.
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0.
00.
51.
01.
52.
02.
53.
03.
54.
01994199519961997199819992000200120022003200420052006BulkcarrierContainerOiltankerOthercargovesselOtherFigure3-2Historicalscrappingvolumesbyshiptype(millionLDT)Itisseenintheabovefigurethatthedecommissioningvolumehasdroppedforallshiptypes,butinparticulartheoiltankersaretradingbeyondtheirexpectedlifetime.
TherearenoEUrecordsofthedestinationofwarships,butusuallythevesselsarescrappednationallyorpreviouslyusedfortargetpractise,althoughthisisnotcommontoday.
Theend-of-lifedestinationforsomelargervesselsinrecentyears:In2003thefrigateHMSScyllawasusedasanartificialreefoffPly-mouth(UK).
TheGermandestroyerRommelwasscrappedinTurkeyin2004.
ThedestroyerWarszawaandseveralothernavalvesselswerescrappedinPolandin2004-2006.
ThetrainingvesselLuciferIIiscurrentlytenderedfordismantlinginCherbourg,France,wherescrappingofsubmarinesalsotakesplace.
Historically,inmanyEuropeannaviesvesselsareoftensoldforcontinueduseinfriendlynation'snavies,butforobsoletevesselsitwasnotuncommontosellforthescrapvaluetoAsianshipbreakers.
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3Methodologyforanalysisofcurrentfleetandfuturedecommissioningvolumes3.
3.
1ApproachandassumptionsAnumberoffactorsinfluencethefuturesupplyofvesselstotheshipscrappingindustryincludingthesizeoftheexistingfleet,thefutureearningpotential,thecostofkeepingtheshipinoperation,theageprofileofexistingfleet,thesizeofthecurrentfleet,regulatoryissues,budgetsetc.
Theimportanceofthefactorsdiffersinvesseltypesandseveralapproachesareusedfortheestimateofthecurrentfleetandtheprojections.
ThesearedescribedbrieflyhereandindetailsinAppendixA:a)Vesseltype1.
TofacilitatecomparisonthesinglehulloiltankersareassumedtobephasedoutaccordingtothesamecriteriaasintheCOWI/TRENstudy(2004).
b)Vesseltype2-9:Thesevesselsareoperatingoncommercialconditionsandarenotsubjecttophase-outregulation.
Theyarephasedoutaccord-ingtothetype'shistoricaltradinglifeexpectancy,exceptforfishingvessels,whichareestimatedfromothernon-cargovessels.
c)Vesseltype10,Warships:EUwarshipsareobviouslynotoperatingoncommercialconditions,butonthebasisofthecostsofkeepingtheves-seloperating,theneedforwarships,politicalarguments,availablebudgetetc.
Regardingthefuturevolumesofscrappingofwarshipsitissimplyassumedthatallwarshipsaged25ormorewillbescrappeddur-ingthenext14years(2007-2020).
SizelimitsTheanalysisfocusesonvesselsof2,000DWTandaboveforvesseltype1-8,fishingvesselsof500GTandabove17andwarshipsof150LDTandabove.
ForthelattertwotypesLDTistypicallynotgivenandconversionfactorstoderiveLDTapply:LDTequals54%oftheGTforfishingvesselsand46%ofthefullyloadedweightforwarships.
CountrygroupingTheprojectionsofthefuturevolumesofscrappingaremadebyflagstateandcountryofownershiponthebasisofthefollowingdefinition:a)EUcountries:The27EUMemberStates.
b)Non-EUcountries:Allothercountries(includingaccessioncountries).
17TheupperintervalofvesselseligibleforscrappingpremiumsintheEUexitschemeforfisheries,EC2792/1999is500GRT.
SinceinmostcasestheGTofavesselisgreaterthanitsGRTslightlymorevesselsareincludedcomparedtothenumberofvesselssubjecttotheEUexitscheme.
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Thisimpliesthatprojectionsaremadefor4categories:EUflag/EUownedNonEU-flag/EUownedEUflag/Non-EUownedNonEU-flag/Non-EUownedTheanalysiscoverstheglobalfleetofvesseltypes1-5and7-8,butonlyfishing(vesseltype9)andnavalvessels(vesseltype10)whichareflyingtheflagofanEUMemberStateandpassengervessels(vesseltype6)sailingtoand/orfromanEUcountry.
Thecountryofownershipforvesseltypes1-5and7-8isidentifiedbasedontheinformationprovidedintheClarksondatabase18,whiletheprojectionsforfish-ingvessels(vesseltype9)arebasedontheCommunityFleetRegister.
Ithasnotbeenpossibletodeterminethecountryofownershipdirectlyforpas-sengerships(vesseltype6).
InsteaditisassumedbylookingatthevesselsoneachrouteinEU,thathalfthevesselsareownedbythecountryoforiginandhalfbythecountryofdestination.
Theinformationonflagstateandroutespe-cificinformationisbasedondatafromShippax'StatisticsandOutlook06'.
DataonEuropeanwarshipsareobtainedfromJane'sFightingShips,Yearbook2006-2007.
3.
4ThecurrentfleetThecompositionofthecurrentfleetofvesseltypes1-10ispresentedinthissection.
Thisinformationisusedforestimatingthefuturevolumesofscrap-ping.
3.
4.
1Vesseltype1-SinglehulloiltankersAllownerandflagstatecountriesThecompositionoftheexistingfleetofsinglehulloiltankersisshownbyyearofdelivery,categoryandhulltypeinTableBinAppendixA.
Thetotalfleetofsinglehulloiltankersrepresents19.
8millionLDT,ofwhich3.
3millionLDTarecategory1tankers.
Theequivalentnumbersforcategory2and3tankersare14.
3millionLDTand2.
2millionLDT,respectively.
Notethatnodistinctionismadebetweensinglehulloiltankersequippedwithdoublebottom(DB)andsinglehulloiltankersequippedwithdoublesides(DS)asthesearetreatedequalintheregulation.
18PleasenotethefollowingstatementfromClarkson:"Theterm"Owners"withinthisproductisusedasasimplifiedtermfor"PrimaryReferenceCompanies".
ThePrimaryRef-erenceCompanyisdefinedasthecompanywiththemaincommercialresponsibilityfortheshipandcanbeOwner,Manager,Agentorotherassociatedcompany.
Noneoftheinfor-mationcontainedinthisproductisintendedtoconfirmorotherwisethelegalstatusofthecompaniesortheshipsassociatedwiththem.
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ThedatainAppendixAshowsthatquitealotofthetankersinoperationshouldhavebeenphased-outinpreviousyears.
Asimpleadjustmentismadetocounteractthisartefact.
Hereitissimplyassumedthatthesevesselsarescrappedoverthecoming5years(ref.
section3.
5).
Theageprofileoftheexistingfleetofsinglehulloiltankersispresentedinthefigurebelow.
0%10%20%30%40%50%60%70%80%90%100%1.
Singlehulloiltankers0-4years5-9years10-14years15-19years20-24years25+yearsFigure3-3Ageprofileofcurrentfleetofsinglehulledtankers-Allownerandflagstatecountries,Vesseltype1(singlehulltankers)shareofLDT.
DuetotheMARPOLrecommendationsnonewsinglehilledtankershaveen-teredthemarketfor10years.
Currentfleetbyowner/flagstateThemajorityofthesinglehulltankersareownedbyresidentsofnon-EUcoun-tries,andonlyaminorshareofthefleetisflyinganEU-27flag(seefigurebe-low).
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0%10%20%30%40%50%60%70%80%90%100%1.
SinglehulloiltankerEUflag/EUownedEUflag/Non-EUownedNonEU-flag/EUownedNonEU-flag/Non-EUownedFigure3-4Thecurrentfleetofsinglehulledtankers-Byowner/flagstate.
Vesseltype1(singlehulltankers)inmillionLDT3.
4.
2Vesseltypes2-8AllownerandflagstatecountriesThetotalfleetofshipsofvesselstype2-8represents225millionLDT.
Othertankers,bulkersandcontainervesselsmakeupaverylargeshareofthecurrentfleet(seefigurebelow).
010203040506070802.
Othertanker3.
Bulkcarrier4.
Container5.
Gas6.
Passenger/ro-ro/vehicle*7.
Othercargovessel8.
Non-cargovesselMillionLDT*OnlyEUFigure3-5Sizeofcurrentfleet,Vesseltype2-8(millionLDT)ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Thefigurebelowshowstheageprofileoftheglobalfleetofvesseltype2-8.
0%10%20%30%40%50%60%70%80%90%100%2.
Othertanker3.
Bulkcarrier4.
Container5.
Gas6.
Passenger/ro-ro/vehicle7.
Othercargovessel8.
Non-cargovessel0-4years5-9years10-14years15-19years20-24years25+yearsNote:Dataforvesselstype6doesnotcoverglobalfleet,butonlyvesselssailingtoand/orfromanEUcountry.
Figure3-6Ageprofileofcurrentfleet-Allownerandflagstatecountries,Vesseltype2-8(ShareofLDT)Thefiguresshowsthatthefleetofcontainervesselsandothertankersarerela-tivelyyoungcomparedtotheothervesseltypes,whereasalargeshareof'othercargovessels'and'passenger/ro-ro/vehicle'shipsisold,morethan20years.
Currentfleetbyowner/flagstateTheprojectionsofthefuturevolumesofscrappingare,asmentionedprevi-ously,madebyEUornon-EUflagstateandEUornon-EUownercountry.
Thecompositionofthecurrentfleetbyownercountryandflagstateisshowninthefigurebelow(informationforpassenger/ro-ro/vehicleisnotincludedasonlyEUvesselsareincludedinthedataset).
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0%10%20%30%40%50%60%70%80%90%100%2.
Othertanker3.
Bulkcarrier4.
Container5.
Gas6.
Passenger/ro-ro/vehicle7.
Othercargovessel8.
Non-cargovesselEUflag/EUownedEUflag/Non-EUownedNonEU-flag/EUownedNonEU-flag/Non-EUownedNote:Nodataforvesseltype6,asanalysisdoesnotcoverthetotalfleet.
Figure3-7Thecurrentfleet-Byowner/flagstate,Vesseltype2-8(MillionLDT)Itcanbeseenthat:Fewvesselsareownedbyanon-EUflagandatthesametimeflyingtheflagofanEUcountry(darkgreen).
EUresidentsownarelativelylargeshareofcontainervesselsand'othertankers'.
RoughlyhalfoftheshipswhichareownedbyanEUresidentareflyingtheflagofanEUcountry(lightgreen)andhalfofanon-EUcountry(yellow).
Thedataonvesselstype6showsthatcloseto80%oftheferries,whicharesailingtoand/orfromanEUcountry,areflyinganEUflag.
3.
4.
3Vesseltype9-FishingvesselsThetotalfleetoffishingvesselsrepresents1.
1millionLDT,ofwhich31%aremorethan25yearsold(seefigurebelow).
Thefleetoffishingvesselsisrelativelyoldcomparedtotheothershipcatego-ries.
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0%10%20%30%40%50%60%70%80%90%100%1.
Fishingvessels0-4years5-9years10-14years15-19years20-24years25+yearsFigure3-8Ageprofileofcurrentfleet-EUMemberStates,Vesseltype9(fishingvessels)(ShareofLDT)ThedatarevealslargedifferencesintheageprofilebetweentheEuropeancountries.
Severalcountries,especiallySpain,SloveniaandSwedenhaveanoldfishingfleet,whereasespeciallyBelgium,EstoniaandPolandhaverela-tivelyyoungfishingfleets.
3.
4.
4Vesseltype10-WarshipsThetotalfleetofwarshipsrepresents1.
6millionLDT.
TheageprofileofthecurrentfleetofwarshipsisshownbelowbycountryintermsofLDT.
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0%10%20%30%40%50%60%70%80%90%100%BelgiumBulgariaDenmarkEstoniaFinlandFranceGermanyGreeceIrelandItalyLatviaLithuaniaMaltaNetherlandsPolandPortugalRomaniaSpainSwedenUnitedKingdomGrandTotal0-4years5-9years10-14years15-19years20-24years25+yearsFigure3-9Ageprofileofcurrentfleetofwarships,EUMemberStates(ShareofLDT)ThefigurerevealslargedifferencesintheageprofilesoftheMemberStates.
Ingeneral,thefleetsareconsiderablyyoungerinthe"old"MemberStates.
Portu-galhasarelativelyoldfleetcomparedtotherestofthe"old"EUMemberStates,withalmost60%ofthevesselsbeingmorethan25yearsold,whereasRomaniahasarelativelyyoungfleet.
ThetablebelowshowsthefleetofwarshipsintermsofLDTandthenumberofshipsbycountry.
Itcanbeseenthat396Europeanwarshipsaremorethan25yearsoldequiva-lentto396,000LDT.
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Table3-1Thefleetofwarshipsbycountry(no.
and1,000LDT)CountryNo.
ofships1,000LDT7m,theyardsconsidereddismantlingtopsidesandfreeboardoutsidetheyardsinportareas.
AsmentionedearliernotallyardsappeartofullycomplywiththerequirementsoftheguidelineoftheBaselConvention,butisitestimatedthatallwouldbeabletointhecourseofoneyear.
Inconclusion,forthelimitedsupplyofvesselsfromgovernmentandfromthefishingindustry,notechnicalconstraintsareforeseenfortheEUcapacityinshiprecycling.
However,thescrappingofgovernmentvesselsmaywellbeseenbylocalyards,thepublicandlocal/nationalauthoritiesasanactivitywellsuitedforjobcreationprogrammesinformershipbuildingcommunities.
ItisthereforeuncertainwhetheranEUwidemarketfordecommissionedgovern-mentvesselswillemerge.
Thispossiblesupplyconstraintmayseriouslylimit22Ninecountries,incl.
naviesofFrance,UK,GermanyandItaly,haveestimatedtheirdis-mantlingneeduntil2015toapprox.
110vesselsover150LDT(MIDN2007).
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theviabilityofgreenrecyclingyardsintheEU.
Tocounteractayardwouldpresumablyseektoacquirevesselsfromthemerchantfleet.
ThemerchantfleetInChapter3theprojectedvolumefordemolitionforallthevesseltypeswasgivenas(excl.
thepeakyear2010):1.
1-1.
8millionLDT/yearforEUflaggedandEUowned(includingfishingvesselsandwarships)1.
0-1.
9millionLDT/yearforEUownedvesselsflyingtheflagofanon-EUcountry;0.
2-0.
3millionLDT/yearforEUflaggedvesselswhichareownedbynon-EUcountries.
Thevesselspotentiallyupforrecyclingobviouslycomprisethepartofthefleetclosetotheirend-of-life,butitmustberecalledthatcommercialvesselsunderEUflagsareoftensoldtocompaniesregisteredinnon-EUcountriesafeworseveralyearsbeforetheirend-of-life.
Atpresent,therearelimitedpossibilitiesforimposingalegalobligationonEUownersflyingnonEUflagstosupplyobsoletevesselstorecyclingyardsofacertainstandardacknowledgedorcerti-fiedinternationally(seealsoChapter2).
MeasuredonLDTapprox.
22%ofallvesselsoperateunderanEUmemberstateflagandsome40%isregisteredasownedbyanEUbasedcompany.
Vir-tuallynoneofthesevesselsarescrappedinEurope,wheretherecycledvesselsonlyaccountedforapprox.
1%oftheglobaldecommissioningvolume.
AssumingthattheprojectionofvesselsunderEuropeanflag(1.
3-2.
1millionLDT)willalsobescrappedintheEU,thenthesizeprofileofthevesselsmustbeconsidered.
Basically,recyclingofashiprequiresaspacelargeenoughforthestructure,mechanicalequipmentinvariouslevelsofsophistication,andworkerstrainedinsaferecycling.
Thetwolatterareeasytoobtain,whereastheformermaybemorechallengingdependingonthestandardsrequired.
AdvantagesofestablishingshiprecyclingfacilitiesintheUKaregivenintheDefrareport(Defra2007),buttheywillapplyonanEUscaleaswell:Thepossibilityofinvestmentinsafer,moreefficientmechanisationofmanyoftheprocessesundertakenmanuallyindevelopingcountries;Removalofhazardousmaterialsbystaffwithappropriateexpertise,us-ingsafeandenvironmentallysoundtechniquesandequipment.
TheUKhasaccesstosuchstaffandequipment;AhighlydevelopeddomesticandEUlegalandregulatoryinfrastructureandeffectiveenforcementofstandards;and,ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Atraditionofmarket-ledinnovationanddevelopmentprovidinggoodopportunitiesforBritishindustrytobenefitfromtheworldwidede-mandsforenvironmentallysoundshiprecyclingfacilities.
Anyrequirementsoftechnicalmodificationofexistingyardsandpierbreakingactivitiesasaresultofinternationalagreements,e.
g.
acomingIMOConven-tion,shouldbereadilyachievable.
Todaycompliancetosafety,healthandenvi-ronmentalstandardsinshiprecyclingtypicallyofsmallervesselsareachievedbywayofmemberstatelicensingandmonitoring(seeChapter5).
Thereisnoreasontobelievethatlargerfacilitiesemployingtheknownmethodologyshouldexceedthecapacityofauthorities'inspectorsandregulators.
DrydockrecommendationIfitisconsideredmandatorytouseadrydockforgreenrecycling,therewillbeaconstrainttoconsider,inparticularfortheverylargestvessels.
ThelargedrydocksintheEU(e.
g.
Gdynia,Poland;ConstantzaandMangalia,Romania)andtheverylargedocks(e.
g.
Belfast,UnitedKingdom;Hoboken,Belgium;Cadiz,Spain)canphysicallyaccommodatetherelativelyfewobsoleteVLCCsandULCCsunderEUmemberstateflags.
However,mostofthedocks,althoughtheymaypresentlybeunderutilised,areusedforrefitsandrepairsandtheiravailabilityforshiprecyclingisamatterofprofitability.
ThefewlargedocksstillengagedinnewbuildingintheEU,presumablyhaveaprofitablenicheproductionandmaynotbeavailableforrecyclingactivities.
23AnextractfromClarksons'demolitiondatabaseforlargeEUflaggedvesselsreadyfordecommissioningintheyearsupto2020(olderthan1995and>100,000DWT)showsthat43vesselspresentlyunderaEuropeanflagwillberecycled(assumingtheyarenotreflaggedtononEUmemberstatesinthatpe-riod!
).
Ofthe43onthelist(alltankers)20aresinglehulledtankerstobephasedoutin2005andsevenarecategory2tankers,whichmustbephasedoutby2010.
TheIMOregulationallowscertainexemptionswhichmayallowfur-thertrading,butinaworstcasescenario27vesselswillsoonawaitrecyclingand12oftheseare>200,000DWT(VLCC)requiringthelimitedlargedrydockingcapacity.
Ifonlythethreelargestdrydockscanaccommodatethem,itfollowsthatoverfouryearsonevesselshouldbedismantledineachdrydock.
Obviously,ifboththevesselsOWNEDbyEUregisteredcompaniesandthevesselsFLAGGEDintheEUmemberstatesmustberecycledintheEUorOECD,thenthenumberofvesselscompetingforalimiteddrydockcapacitywillincrease.
Stillundertheassumptionthatallvesselswillmaintaintheflagandownershipconstruction,some103vesselsaretobescrappedintheEUun-til2020–correspondingtoeightvesselsperyear.
However,55aresingleskinsthataretobephasedoutbytheendof2007unlessexempted.
Upto41willbe>200,000DWT(VLCC),solargethattheymayonlyberecy-cledinthelargestdrydocks.
AssumingthesamecapacityinthreeEuropeanyardsasplannedinthePipavavfacilityinIndia,12VLCCcanbedismantled23Referenceismadetotable8.
3Dry-dockswithacapacityabove60,000DWTinCOWI7TREN(2004)ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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peryear.
Thissuggeststhatvesselsmayhavetobelaidup,thatmorefacilitiesshouldbeincludedorthatdrydockingshouldbecombinedwithpre-cleaningandtopsidesdismantlingwhilemooredatapier.
PierbreakingacceptedTheclaimfordrydocksbytheNGOsisbasedontherecommendationsoftheESMguidelineoftheBaselConventionbecausethetextmentions"imperme-ablesurface"asarequirementduringdismantling.
Thisrequirementiscur-rentlyinterpretedastheships'hullmayserveasanimpermeablebarrierandincombinationwithawetbarrier(aboom)theexistingmethodsofpierbreakingandslipwaybreakingdocomply.
IfthepierbreakingmethodscontinuetobeacceptedasgreenrecyclingthereisalargedormantcapacitymeetingthephysicaldimensionrequirementsinportsandwaterwaysthroughouttheEU,evenforverylargevessels.
Inpractice,pierbreakingareoftencombinedwithdockingcapacityorslipwayforthebreakingofthekeel.
Pre-cleaningcapacityPre-cleaningwithoutscrappingafterwardsisnotcarriedoutinanyEUmemberstateharbouronaregularbasis.
Anexampleofpre-cleaningistheformerUKnavyvessel,HMSScylla,whichwasdecontaminatedpriortobeingsunkoffWhitsandBaynearPlymouthtobecomeanartificialreef.
Insuchcases,theLondonConventionSpecificGuidelinesforAssessmentofVesselswillapply(UK2006b).
Clearingavesselforhazardouswasteorpre-cleaningitisgenerallynotseenasamarketareafortheyardssincetheyaretypicallyborneoutofthemetalrecy-clingbusiness.
Thistaskisusuallyoutsourcedtospecialistcompaniesthatmayperformmostoftheactivitywhilethevesselismooredinportratherthanontheyardpremises.
Thus,pre-cleaningofvesselsshouldnotobstructutilisingtheyard'scapacityforscrappingofthehulls,althoughwithlargerandmorecomplicatedconstructionsthecleaningmaybemoreintermittentwiththeac-tualdismantling.
OnanadhocbasistheDutchauthoritieshadtheSandrienandtheOtapanpre-cleaned(seeChapter2forlegalimplicationsofpre-cleaning).
Also,theFrenchauthoritieshadtheClemenceaupre-cleanedpriortodepartureforTurkey.
InseveralEUcountriesregulationsexistastotherequirementsforthepre-cleaningofobsoletevesselspriortotheuseastargetsfornavalandmilitaryshootingpractise.
Thus,theskillsandfacilitiesforpre-cleaningofshipsareavailable,butthescopeandintermittentneedfortheservicehasnotledtotheemergenceofaviablemarket.
Itisclearthatpre-cleaninghasbeenanarduousandtimeconsumingprocessinthesecases.
Severalofthevesselswerepre-cleanedformorethan12months.
Inyardsengagedinthesubsequentscrappingitisestimatedthatpre-cleaningtakes4-7weeks.
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4.
2FacilitiesinEUcandidatecountriesTurkeyandCroatiaandEFTAcountryNorwayTheshipbreakingfacilitiesinAliaga,TurkeyTherearesome25plotsforshipbreakinginAliagathatareoperativetoday.
Theprocedurecanbecharacterisedasslipwayrecycling:thereisaconsiderabledraughtnearthecoastandevenlargevesselsof10,000LDTandmorearerunashore.
Thevesseliscutfromthebowandsectionsof600-800tonnesarecutandpulledontothecuttingareabywrenches.
Smallersectionsandequipmentareremovedbycranes.
Vehiclesandcranescanoperateclosetothevesselontheshoreoronbarges.
TheplotsaresituatedonGovernmentpropertypreviouslyleasedforonlyfiveyearsatatime.
In2006theleasetermswerechangedandleasesnowrunsfor20years.
ThelongerperspectiveisconsideredbytheTurkishShipbreakingAs-sociation(TSA)toincreasethewillingnesswithyardownerstoinvestinsafety,healthandenvironmentalimprovementsoftheyards.
TheyardswerethetopicofacriticalGreenpeacereport(Greenpeace2002),andsincethenahazardouswasteprogrammehasbeeninitiatedbytheTSA,whohiredamanagerwithhazardouswastemanagementresponsibilities.
Thishasledtoimprovedproceduresinyardsandtheprogrammealsoincreasedtheavailabilityoffacilitiesforhazardouswaste:amobileasbestosdecontaminationunit,anorganisedoilywastecollection,andhazardouswastereceptionfacili-tiesarenowavailabletotheyards.
Someyards(e.
g.
Cemas)havenowlargeconcretepavedareasforthecuttingprocedures;othershaveinvestedintheirownasbestosunitandoilpumpingandstoragefacilitiesnottomentionobtain-ingISO9001,ISO14001andOHSAS18001certification(LeyalShipDisman-tling&Recycling)24.
TheSimsekleryardwaschosenbybothFrenchandDutchauthoritiesfortheproposedrecyclingoftheClemenceauandtheOtapan,respectively.
ComparedtothesituationdescribedintheGreenpeacereportin2002,theim-provementsinseveralyardsinAliagaaresignificant.
AcompliancewiththerequirementsoftheBaselConventionGuidelineonShipDismantlingisnotafarfetchedpossibility(Neseretal2006),althoughtheacceptanceofwetrecy-clingisaprerequisite.
Thefullannualcapacityhaspreviouslybeengivenas600,000LDTwith800-1200employees(~500LDT/manyear),butrecentestimatesbyoneoftherecy-clingyardsbringsthenumberupto1,000,000LDT/year(Ayvatoglu2006).
Turkey'sShipbreakingRegulationcameintoforceinMarch2004andinearly2007are-permittingexercisewascarriedoutfortheactiveyards.
Fouryardswereawardedpermits,whereastheremainingyardsweregrantedconditionalpermitstoberenewedafterreconsideration.
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ShipyardfacilitiesinCroatiaTherearefivemajorshipyardsinCroatiaorganisedinajointcompanywheretheCroatianGovernmentholdsamajorityofshares.
Therearenoreportsonshiprecyclingoflargervessels,buttheyardsinBrodotrogirandKraljevicaareinvolvedinshiprepairactivitiesforvesselsupto50,000and25,000DWT,re-spectively.
4.
2.
2UpgradinginTurkeyandCroatiaTurkeyTheoptionsforupgradingfacilitiesintheOECDcountryTurkeyisparticularlyinterestingfortheEU,sinceTurkeyisinapre-accessionmodeandthereforeisunderwaywithadheringtotheEUlegislation.
Thus,ifthecapacityoftheexist-ingshipbreakingfacilitiesinAliagaclosetoIzmirmeetstheappropriatestan-dards,EUvesselscanbeexportedtheretowithoutviolatingtheBaselConven-tion,theBanamendmentorWasteShipmentRegulation.
ThefacilitiesinAliagaareonlyaccountableassaferecyclingfacilitiesifdrydockingisnotarequirement.
Themethodologyoflandingontheshoreandpullingthevesselashoreandcutitfromthebowmayneedtoberefined.
Thismaybeachievedbyusingpontoonbridgesorbargesalongthevesseltoac-commodatetheuseofheavyequipmentalongsidethevesselandatthesametimereducingthewaveactiononthegroundedvessel.
Itisapossibilitytopre-cleanvesselsintheEUandtotowtheemptiedhullstoscrappinginTurkey.
Inthiscase,however,thetransporttoanon-OECDcoun-tryislegalandmaybemoreprofitable.
CroatiaTheoptionsforusingCroatianyardsforshipbreakingaresimilartotheEUandTurkishconditionsintermsoftheneedforadherencetotheEUacquis.
TherearenoreportsonanyinterestinshiprecyclingoflargervesselsinCroatia.
4.
2.
3EFTAcountryNorwayNorwayhasanumberoffacilitiesthatmayentertheshiprecyclingmarketforlargervessels.
AfacilityinNorway(FosenGjenvinningAS)isactiveonthedemolitionmarketforsmallervesselsandmaybeupgradeabletoaccommodatelargervessels.
Noplanshavebeenpublished.
ThreefacilitiesinNorway:AkerStord,NorskMetallreturOffshoreRecyclingASandAFDecomASareactiveinthedecommissioningmarketforoffshoreplatforms.
Noneofthesehaveanycurrentplansofenteringtheshiprecyclingmarket.
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4.
3GreenshipdismantlingfacilitiesoutsideEUandEuropeanOECDcountriesThecompaniesshownbelowhaveidentifiedthemselvesasISO14001and/orOSHA18001certifiedortheyaresituatedinanOECDcountryandassuchaprioriacceptableforexportofvesselsforrecyclingfromtheEU.
SinceNorwayandTurkeyhavebeenincludedpreviously,thiswouldincludetheOECDcoun-triesAustralia,Canada,Japan,Korea,Mexico,NewZealandandUSA25.
4.
3.
1OECDcountriesUSADuring2006thereweresevenshiprecyclingfacilitiesoperatingintheUSAlocatedinBrownsville,Texas;NewOrleans,Louisiana,Norfolk,VirginiaandBaltimore,Maryland.
TheirclientsareMARAD,theU.
S.
Navyorcommercialoperators.
TheapproximatetotalcapacityintheU.
S.
is225,000tonsperyearatthefacilities.
ThefourcompanieslocatedinBrownsville,Texascanaccommo-dateatotal150,000tonsperyear,withInternationalShipbreakingLimitedpro-vidingone-thirdofthetotalBrownsvillecapacity.
VesselsforrecyclinghavenotbeenimportedtotheUSAinrecentyears.
TheUSAisnotaPartytotheBaselConvention,andtheimportwouldfallundertheToxicSubstancesCon-trolAct(TSCA),whichalsoprescribesapre-notification.
TheUSEPAhasstatedthatanapplicationtoimportashipwouldrequirea9-12monthspublicreviewandapprovalprocessandthatthelicensetoimportthevesselwouldbelimitedtooneyear.
26CanadaInPortColborne,Ontario,theInternationalMarineSalvageInc.
dismantlesCanadianandimportedvesselsinafacilitythatisISO14001certified27.
Thecompanyhasrecycledinexcessof150,000tonsofsteelfromdismantlingshipssince1985.
Thissteelhasprimarilybeenre-meltedintonewsteelbydomesticsteelproducer,butsubstantialtonnagehasalsobeentransportedtovariousmillsinAsia,forre-rollingintonewbarsandstructuralshapes.
CanadaisasignatorytotheBaselConvention.
OtherOECDcountriesNorecyclingfacilitiesforlargervesselshavebeenidentifiedinAustralia,Ja-pan,SouthKorea,Mexico,NewZealandorIceland.
JapanandKoreawerescrappingnationsinthe1970sand1980sandMexicohadascrappingindustryuntilthe1990s.
TheMexicanIndustrywaspartlybasedonvesselsexportedfromtheUSA.
Thecountrieswill,however,typicallyhavemarinesalvagecompanieswithsomeaccesstobreakingfacilities,butthesearetypicallyrepairandmaintenanceyardsandonlyusedforscrappingvesselsonanadhocbasis.
BesidestheUSA,theonlyOECDcountrywithanysignificantshiprecyclingindustryisTurkey.
25Switzerlandnotincluded.
26InformationonUSAprovidedbyJohnGraykowski,DirectorofMarineRecyclingCon-sultants/InternationalShipbreakingLimited27RobindeBois(2006)Ship-Breaking.
com.
InformationBulletinonshipdemolition#6.
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4.
3.
2ExportingtootherOECDcountriesRecyclingfacilitiesonboththeAtlanticandPacificcoastsoftheAmericaswillbeusefulconsideringthatamerchantvesselmaybeenrouteorinanygivenportinthesewaterswhenadecisiontoscrapistaken.
AtpresentthemajorityofactivegreenrecyclingcapacityislocatedintheUSAduetotheUSNavyandMARADdemandforshipscrappingunderacceptablesafety,healthandenvironmentalconditions.
ThereisnoclearindicationthattheAmericanfacilitiesmayoperateonanopeninternationalmarketandbe-comeavailableforforeignvesselsforscrap.
TheCanadianfacilityhascateredprimarilyforthedomesticmarket,buthasrecentlyexpressedinterestinoperatingontheinternationalmarketinparticularregardinggovernmentvessels.
ThereisasizelimitationtotheimportofoceangoingvesselsastheymustpassthelocksoftheWellandCanal.
4.
4Asiaandnon-OECDcountriesInthecountriestypicallyrankedasprimeshipbreakingcountriesnationalasso-ciationsofshipbreakersexist,andsomeofthemorotherauthoritieshaveiniti-atedactivitiestoupgradetheirnationalshiprecyclingyards.
ThisisespeciallytrueforChinaandtosomeextentIndia.
InbothcountriessomeshiprecyclershaveobtainedthequalitymanagementISO9001certifications.
IndiaAccordingtopressreleasesfromGujaratMaritimeBoard,whichisthemanag-ingauthorityoftheshipbreakingonAlangBeach,22companiesinAlangareahavereceivedISO14001and/orOSHA18001certification.
Alistof32facili-tiesinAlangcertifiedforISO18801andOHSAS18001wasavailablefromacashbuyer28.
MostyardswerecertifiedbyInternationalCertificationServices(Asia)Pvt.
Ltd.
,andsomethroughtheclassificationsocietyRINA.
Threeyardswithacombinedannualcapacityof60,000to100,000LDTpresenttheircerti-ficationsontheircompanyhomepagesontheinternet.
.
AccordingtotheGujaratPollutionControlBoardtheyardsatAlangnowhaveaccesstoaTreatment,StorageandDisposalFacility(TSDF)forhazardouswastefromtheshipbreakingactivities(GujaratPollutionControlBoard2006).
ThePipavavfacilitynearAlangisalargesemidrydockfacilityconstructedfor"green"recyclingofuptofourVLCCsatatime.
ItwasdevelopedbyprivateIndianfundsandfinancialassistancefromJapanintheformofloans.
Itispres-entlynotactiveintherecyclingmarket.
28ListfromGMSofcertifiedshipyardsinAlangin2006ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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ChinaInthelate1990sP&ONedlloydwaschallengedtoimprovetheirdecommis-sioningpracticesandthecompanysubsequentlychangeditspolicyonthemat-ter.
TheychosetwoyardsnearShanghaiandinitiatedacapacitybuildingpro-jectonsaferecycling.
P&ONedlloydendeduprecycling19vesselsinChinabetween2000and2003underthecompany'ssupervision.
Ontheshouldersofthiseffort,theChineseNationalShipbreakingAssociationinitiatedacampaigntoupgradethesafety,healthandenvironmentalissuesatfouryards,partlysup-portedbytheChina–NetherlandsEnvironmentalProtectionCooperationPro-ject(2005).
Chineseauthoritiesregulatedshipbreakingspecificallyalreadyin1988,andrecentlyimplementedthe"Generalregulationsongreenshiprecy-cling"and"TechnicalguidelineforPollutionPreventionrelatedtoShipbreak-ing"from2005and2006,respectively.
AtleastfouryardshaveachievedISO14001andOSHA18001,i.
e.
thecertifi-cationsregardingmanagementofenvironmentandhealthandattherecentIMORegionalSeminarandWorkshopheld5-8February2007inZhuHai,China,thecompaniescapableofrecyclinglargevessels(VLCCsandULCCs)inChinaweregivenas:XinHuiShuangShuiShipBreaking&SteelCo.
LTDZhongxinShipbreaking&SteelCo.
PanYuShipBreakingandSteelRollingCo.
ChangJiangShipBreakingYard.
Thecapacitieshavepreviouslybeengivenas800,000LDT/year.
Intheautumnof2006,ChinaNSAcarriedoutatrialonshiprecyclinginaccordancewiththedraftconventiononshiprecycling.
ThetrialtookplaceatChangJiangShipBreakingYardonthecontainershipNedlloydDubai(BIMCO2007).
ThisyardwasalsousedduringthefirstChinese"green"shipbreakingcampaignin2000-2003.
PakistanandBangladeshIthasnotbeenpossibletoidentifyshipbreakersinBangladeshorPakistanwithcertificationsregardinghealthorenvironment,suchasISO14001andOSHA18001.
TheILOprojectonshiprecyclinginBangladeshdidnotreportonanycertifiedyards(Feringa2005),butthePHPGroupisreportedlyseekingcertifi-cationforayardinChittagong.
NoinformationisavailablefromPakistan.
OthercountriesJapanhassupporteddevelopmentsofshipbreakingintheWestCebuinthePhilippinesandaspreviouslymentionedprovidedfinancialassistancetotheconstructionofthePipavavfacilityneartheAlangarea.
Noneoftheseenter-priseshaveprovedviableintheshipbreakingmarket.
Also,Vietnamisengagedintheshipbreakingmarketbutpresentlyonlyonaverylimitedscale(1%oftonnage).
Noinformationisavailabletoassesstherelevantcompliancelevelofthesefacilities.
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4.
4.
2ProjectionsforAsianyardsAccordingtopressreleasesfromtheGujaratMaritimeBoard,22facilitiesatAlanghavereportedcompliancetoISO14001onenvironmentalmanagement,andinformationfromthecashbuyerGMSlists32yardswithISO/OHSAScer-tificationsinAlang29.
Itisemphasisedthatalthoughthepresentstudyisfo-cusedonenvironmentalissues,theacceptanceofayardasanoperatorinsafeandenvironmentallysoundshiprecyclingincludestheproceduresofsafetyandhumanhealthissues.
IssuesregardingcertificationarefurtherdiscussedinChapter5.
ThePipavavShipDismantlingEngineeringLimitedmaystillbeconsideredadormantrecyclingfacilitylocatedatthePipavavPortintheStateofGujaratsome70kilometresfromAlangBeach.
Thefacilitywasconstructedwiththeaimofmeetingthenewstandardsforenvironmentalprotectionandwasfinal-isedin2003.
ItwasbuiltbySumitomoCorp.
ofJapanforGujaratPipavavPortLtd.
withaloanfromOverseasEconomicCorp.
FundofJapantoprovideasaferrecyclingthanthenearbyAlangbeach,buthasnowbeenconvertedtoashipbuildingyard.
ThedimensionsandproceduresofthePipavavfacilityhavebeendescribedbe-fore(COWI/TREN2004),butinbriefitistwoslopingwetdockseachwithalengthof680metersandwidthsof60and65meters,respectively.
Thefirst70%ofthedismantlingofavesselisperformedatthedeeperendofadockandthevesselismovedtotheshallowdockendduringahightidewherethere-maining30%ofthedismantlingisperformed.
Thedockingcapacityallowsdismantlingoffourvesselssimultaneously.
Theannualdismantlingcapacityundernormalconditionsisplannedtobe275,000LTDwithanoptimalcapac-ityofsome400,000LDT.
Unfortunately,noshiphastodatebeenrecycledatthefacility.
AccordingtotheIMOMEPCseminarinFebruary2007inZhuHai,China,thecapacityismorethan3,000,000LDT/year,anditisestimatedthat800,000LDT/yearisinyardsthathaveISOandOSHAcertificationsorhavehadpro-ceduresupgradedandauditedbyP&ONedlloyd.
Thelatteryardhasprojectedexpansionstoprovidecapacityforupto1,000,000LDT/year30,bringingthetotalgreencapacityupto1500,000LDT/year.
4.
5SummaryofexistingandprojectedcapacityandrecyclingneedTheexistingcapacityofgreenrecyclingworldwidemayapproach200,000LDT/yearintheEU,butisatpresentnotsuitableforvesselsofVLCCsizeandlarger.
29ListreceivedfromGMSofcertifiedshipyardsinAlangin200630InformationprovidedtoFrankStuer-LauridsenduringasitevisitinNovember2005.
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Table4-1Summaryofexistinganddormantcapacityforsafeandenvironmentallysoundshiprecycling.
SafeandenvironmentallysoundshiprecyclingExistingcapacityDormantifdrydockrequiredDormantcapacitybypierorlandingmethodEU200,0001,000,000LargeCandidatecountries(Turkey)**50,000-600,000–1,000,000OECD(US+Can)225,000NotestimatedNotestimatedAsia***800,000Notestimated1,500,000–3,000,000Total1,325,0001,000,0001,950,000–4,000,000*AssumingthreedockswiththesamecombinedcapacityasthedesigncapacityoftheformerPipavavfacilityinIndia(400,000LDT/year)+AbleUKwithaplannedcapacityupto600,000LDT7year.
**ThecapacityinTurkeyisyetnotfullyacceptedasgreenrecycling.
***Chineseyards.
InformationfromIMOMEPCseminarinZhuHai,Chinasuggestexpandableto3,000,000LDT/yearTheabove-mentionedIndianyardswithcertificationswouldadd>1,000,000LDT/yeartotheglobalgreencapacity.
However,withthepresentknowledgeofcontainmentemployedinthebeachingmethod,theyardscannotbeacceptedasgreenrecycling.
Table4-2ComparisonofexistinganddormantsafeandenvironmentallysoundrecyclingcapacitywiththepotentialsupplyofgovernmentvesselsandmerchantvesselsEUGovernmentvesselsandfishingvesselsLDT/yearRecyclingdemand40,000ExistingEUcapacity200,000Balance+160,000CapacityneedNoextracapacityneededCertifiedfacilityinTurkey*50,000EuropeanflaggedmerchantfleetLDT/yearRecyclingdemand1,600,000ExistingEU200,000MobilisableinEU(existinginfrastructure)1,000,000Balance-400,000CapacityneedExtracapacityneededMobilisablecapacityinTurkey*600,000CertifiedfacilitiesinChina*1,500,000*ThecapacityinTurkeyandChinaisnotyetfullyacceptedassafeandenvironmentallysoundrecyclingandthefacilitiesinChinaareoutsideofOECD.
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Insummary,theexistingEuropeancapacitywillbesufficientforthefishingvessels,navyvesselsandothergovernmentownedvesselstoberecycledoverthenext10years.
ToprovidegreenrecyclingintheEUforthemerchantfleetpresentlyunderEUmemberstateflagthedormantcapacitymustbeinvigo-rated.
Thenumberofpotentialfacilitiesandthephysicaldimensionsofthepo-tentiallyavailablestructuresarejustsufficienttoaccommodatethemaximumsizesofthefleet,butseveraldrydocksmustbeopenedforrecycling.
Itwillalsobenecessarytocontinuetousepierbreakingforpre-cleaningandpartialdismantling.
However,itshouldbekeptinmindthatthedemandforscrappingof1.
6mil-lionLDT/yearofEUmemberstatesflaggedvesselsisanaverageofarangeupto2.
1millionLDT/yearexcludingtheyear2010.
ThedemandforrecyclingofEUmemberstateflaggedvesselsinthepeakphaseoutyearof2010ispro-jectedto2.
7millionLDT.
IfvesselsownedbycompaniesinEUmemberstatesareincludedonemayadd3.
1millionLDTforrecyclingin2010.
Obviously,capacitycannotbeestablishedforasinglepeakinthedemand,butadditionalcapacitywillbeneededforaverageyearstoensuretheaccessofEuropeanmerchantshipownerstocertifiablegreenrecycling.
ThisadditionalcapacitycantosomeextentbefoundinTurkeyprovidedtheshorelandingmethodologyisacceptedassafedismantling.
Thecapacityavailableormobi-lisableinChinaaddssignificantvolumetothedemandthatcanbemetforgreenrecycling.
However,sinceChinaisnotamemberoftheOECDtheyardsmayatpresentonlycomeintoplayforEU-flaggedshipsthatarenotexportedforscrappingfromtheCommunity,i.
e.
shipsthatdonotbegintheirfinalvoy-ageinanEUport.
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5OverviewofstandardsandguidelinesforshipdismantlingThissectiondrawsanoverviewofexistingstandardsofenvironmentallysoundmanagementinshipdismantling.
Theoverviewbrieflyoutlinesandcomparestheexistingstandardswithspecialattentiontothemethodsappliedbythestan-dards,alsoaddressingifacertificationsystemandthirdpartyaccreditationisincludedinthedifferentstandards.
TheoverviewfurtherincludesEnvironmentalHealthandSafetystandards(EHS)ofinternationalorganisations,whichcouldbeappliedtoshipdisman-tling.
TheapplicabilityoftheguidelinestowardscontrollingEHS-issuesinshipdismantlingisanalysed.
Finally,theoverviewincludesguidancedevelopedbyEUmemberstates,otherflagandrecyclingstatesaswellasshippingassociationsandprivateshippinglines,forwhichtheexistenceofcompanypoliciesdirectlyonshiprecyclingorenvironmentalpoliciesincludingshiprecyclingisdescribed.
5.
1ExistingstandardsandguidelinesonsafeandenvironmentallysoundmanagementinshipdismantlingSeveralinternationalstandardsandguidelinesonsafeandenvironmentallysoundrecyclingofshipshavebeendevelopedbydifferentinternationalorgani-sationsandnationalgovernments.
Thelistbelowincludestheidentifiedstandardsandguidancedocumentsrelatedtotherecyclingofvessels:UNbodiestechnicalguidelines-BaselConventionTechnicalGuidelinesfortheEnvironmentallySoundManagementoftheFullandPartialDismantlingofShips-ILO:Safetyandhealthinshipbreaking:GuidelinesforAsiancountriesandTurkey-IMOGuidelinesonshiprecyclingSpecificguidanceonpre-cleaninganddecontaminationShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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-IMOGuidelinesfortheDevelopmentoftheShipRecyclingPlan-IMOrecommendations&guidanceon"Gas-free-for-hot-work-certification"duringshiprecyclingoperationsIndustrycodesandstandardcontracts-ICSIndustryCodeofPracticeonShipRecycling-ICSInventoryofPotentiallyHazardousMaterialsonBoard-BIMCOStandardContractfortheSaleofVesselsforDemolitionandRecycling(Demolishcon2003)Practicalmanualsonshipdismantling-DraftPocketManualonImplementationofGreenShipRecycling,pre-paredbyDanishEnvironmentProtectionAgency(June2006)-U.
S.
EPA"AGuideforShipScrappers–TipsforRegulatoryCompli-ance".
5.
1.
1IMO,ILOandBaselConventionGuidelinesThethreeUnitedNationsbodies:theInternationalMaritimeOrganisation(IMO),theInternationalLabourOrganisation(ILO)andtheConferenceofPar-tiestotheBaselConventionontheControlofTrans-boundaryMovementsofHazardousWastes(theBaselConvention)areamongthosewhohavebeenen-gagedintheareaforthelongestperiodandproducedthemostdetailedguide-lineswithinthefield.
However,noneofthethreeguidelinesaremandatoryandthepracticalapplicationofthemtodatehasbeenlimited.
Intherecognitionoftheneedforcoordinationoftheirworkwiththeaimofavoidingduplicationofworkandoverlappingofroles,responsibilitiesandcompetenciesbetweenthethreeorganizations,ajointworkinggrouponshipscrappingwasestablishedin2005.
TheworkandoutcomeofthejointworkingonshipscrappingestablishedbyIMO,ILOandtheBaselConventionisde-scribedinChapter2.
BesidesthisjointworkIMOhavethemselvesinitiatedworkondevelopingabindingInternationalConventionfortheSafeandEnvironmentallySoundRe-cyclingofShips,theIMOConventiononSafeandEnvironmentallySoundRe-cyclingofShips.
ThisConventionisdescribedandanalysedinmoredetailinChapter2.
Inparalleltothenegotiationofabindinginternationalregimeforcleanshipdismantling,anumberofguidelinesarecurrentlybeingprepared.
Theguide-lineswillsupplementtheIMOConvention.
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ProposedGuidelinesfortheIMOConventiononShipRecyclingThefollowingistheprovisionallistofnineguidelinesfortheshiprecyclingConvention,groupedintothree:General-Guidelinesforcommunicationofinformation.
Guidelinesforships-GuidelinesforthedevelopmentofInventoryofhazardousmaterials-Guidelinesforthesubmissionofaproposaltocontrolhazardousmaterials-Guidelinesforsurveysandcertification-Guidelinesforinspectionofships-Guidelinesforestablishinggas-free-for-hot-workconditions.
Guidelinesforshiprecyclingyards-Guidelinesforauthorizationofshiprecyclingyards-Guidelinesforsafeandenvironmentallysoundshiprecycling-GuidelinesforthedevelopmentofShipRecyclingPlan.
AtMEPC55theintercessionalCorrespondenceGroupwastaskedwiththede-velopmentofanoutlineofoneortwopagesforeachguideline.
SomeguidelinesarefurtherdevelopedalreadybytheCorrespondenceGroupincludingtheguidelinesforshiprecyclingyardsonsafeandenvironmentallysoundshiprecycling,whichisbeingdraftedbyJapan31.
Theprimaryinten-tionsofthisdraftguidelinearetoprovideinformationtooperatorsofshiprecy-clingfacilitiestoenablethemtounderstandhowtocomplywiththeESMre-quirementsoftheConvention.
TheJapanesedraftguidelineforshiprecyclingyardsonsafeandenvironmen-tallysoundshiprecyclingdetailstheESMrequirementsoftheConventionafterithasenteredintoforce.
Therequirementsarespecifiedforthefourdifferentmethods:beaching,landing,afloatanddry.
Specificallyregardingbeaching,thedraftguidelinespecifiesthatstrictmanagementrequirementsarenecessaryandthatthemethodisnotrecommendedfornewly-establishedfacilities.
Anexam-pleofaspecificrequirementforthebeachingmethodisinstallationofappro-priateoilreceptionand/orstorageapparatusadjacenttothebeachedhull,inordertocollectresidualoil,solventsusedforsludge,and/oroilcleaning.
Thedraftguidelineisstillundernegotiationanditsfinaldestinyisnotknownatthetimeofwriting.
31MEPC56/3/4and56/3/5DraftGuidelinesforsafeandenvironmentallysoundshiprecy-cling–PartIandII.
SubmittedbyJapan6thApril2007.
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5.
2ExistinginternationalEHSstandardsBesidestheabovereferredinternationalstandardsandguidanceonenviron-mentallysoundmanagementinshiprecyclingasdescribedabove,differentin-ternationalstandardsandguidanceonEHS-managementexist.
Themostwide-spreadEHS-standardwhichcanbeandisbeingusedtocontroltheenviron-mentalimpactsofshiprecyclingistheenvironmentalstandardISO14001andthestandardforoccupationalhealthOHSAS18001.
Thesestandardsaredescribedandanalysedbelow.
Focusisontheirapplicabil-ityinshiprecycling,hereunderfeaturesaboutthestandardthatneedsspecialattention.
5.
2.
1ISO14001TheInternationalOrganizationforStandardization,ISO,isanongovernmentalorganisationthathasdevelopedthewidespreadenvironmentalstandard,ISO14000,whichconsistofaseriesofvoluntarystandardsandreferencedocumentsdesignedtoprovidethegeneralframeworkfororganizingthetasksnecessaryforeffectiveenvironmentalmanagement.
Frequently,theseriesofstandardsarereferredtoasISO14001,becausethisisthenumberoftheactualstandard.
Allothersectionsintheseriesaresupportdocuments,includingguidelinesforimplementation,environmentalauditing,environmentallabelling,andproductlifecycleassessment.
TheISO14001standardisagenericmanagementsystemstandard,whichmeansthatthesamestandardscanbeappliedtoanyorganization,largeorsmallandwhateveritsproductorthescopeofactivityis.
TheISO14001stan-dardmustbefollowedbythird-partyverificationtoobtaincertificationtowardsthestandard.
Thefirstsectionofthestandarddirectstheorganizationtoidentifyitsactivities,products,orservicesthatcanoralreadysignificantlyimpacttheenvironment.
Secondly,theorganizationmustdevelopanenvironmentalpolicy"appropriatetothenatureandscale"oftheactivities,products,orserviceswithsignificantenvironmentalimpacts.
Theremustbeaspecificcommitmenttopreventpollu-tion.
Topmanagementmustdefinethepolicyandensurethatitiscommuni-catedtoallemployees.
Inthepolicy,theorganizationmustcommittocomplywithallpertinentenvironmentallegislation,regulations,and/orlegalrequire-ments.
Perhapsmostimportant,thesectiondirectstheorganizationtoset,re-view,anddocumentdefinableenvironmentalobjectivesandtargetsatrelevantfunctionsandlevelswithintheorganization.
Inthethirdsectionofthestandard,theorganizationmustdevelopaprogramforachievingitsmanagementobjectives.
Theprogramwillincludeassigningresponsibilityforobjectivesat"eachrelevantfunctionandleveloftheorgani-zation"andestablishingatimeframefortheiraccomplishment.
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Thefourthmajorsectionofthestandardcallsfortheimplementationandop-erationoftheenvironmentalmanagementprogram.
Thissectionincludespro-visionstoeducateemployeesormembersateachrelevantfunctionandlevelabouttheorganization'senvironmentalmanagementsystemandtheirrolesandresponsibilitiesinachievingtheorganization'sgoals.
Inaddition,theprovisionscallfortrainingofemployeesormemberstocarryouttheirtaskswithintheenvironmentalmanagementsystem.
Finally,withinImplementationandOpera-tion,theremustbeproceduresforpreventingandmitigatinganyenvironmentalimpactsfromaccidentsandemergencysituations.
TheCheckingandCorrectiveActionsectiondirectstheorganizationtomonitorandmeasureoperationswithsignificantenvironmentalimpactsonaregularbasis.
Theorganizationmustestablishandmaintainadocumentedprocedureforevaluatingcompliancewithpertinentenvironmentallawsandregulations.
Thestandardcallsforacontinu-ousauditofcompliancewithandperformanceoftheenvironmentalmanage-mentsystem.
Finally,thestandardrequiresthattopmanagementreviewtheenvironmentalmanagementsystemandprovidechangestopolicy,objectivesoroperationswhennecessarywhichshouldleadtogreaterefficiencyandcon-tinualimprovement.
ISO14001doesnotincludearequirementforthefirmtomakeitsenviron-mentalperformanceavailabletothepublic.
5.
2.
2OHSAS18001TheOHSAS18000seriesofstandardsthatincludesOHSAS18001Occupa-tionalHealthandSafetyManagementSystems(OHSMS)grewoutoftheinter-nationalsuccessof,amongstothers,theISO14000seriesofstandardsandtheneedformanagingsafetyintheworkenvironment32.
ThisstandardwascreatedfromtheBritishStandardforOccupationalHealthandSafetyManagementSystemsBS8800:1996.
DescriptionTheOHSAS18001cameintoeffectinApril1999.
Itsfulltitleis"Occupationalhealthandsafetymanagementsystems-specification".
Thereisaseconddocumentintheseries(OHSAS18002),whichprovidesguidelinesontheim-plementationofOHSAS18001.
OHSAS18001isbasedpartlyontheISO14001diagramonplan,do,checkandimprove.
AccordingtothescopeoftheOHSAS18001specificationitisapplicabletoanyorganizationthatwishesto:32TheILOalsohasastandardentitledILO-OSH2001.
TheILOGuidelinesonoccupa-tionalsafetyandhealthmanagementsystems(ILO-OSH2001)wereadoptedatatripartiteMeetingofexpertsinApril2001.
TheILOGoverningBodyhasapprovedthepublicationoftheGuidelines.
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establishanOH&SmanagementsystemtoeliminateorminimizerisktoemployeesandotherinterestedpartieswhomaybeexposedtoOH&Srisksassociatedwithitsactivities;implement,maintainandcontinuallyimproveanOH&Smanagementsys-tem;assureitselfofitsconformancewithitsstatedOH&Spolicy;demonstratesuchconformancetoothers;seekcertification/registrationofitsOH&Smanagementsystembyanex-ternalorganization;ormakeaself-determinationanddeclarationofconformancewiththisOHSASspecification.
5.
2.
3EMASTheEUEco-ManagementandAuditScheme(EMAS)isamanagementtoolforcompaniesandotherorganisationstoevaluate,reportandimprovetheirenvi-ronmentalperformance.
Theschemehasbeenavailableforparticipationbycompaniessince1995(CouncilRegulation(EEC)No1836/93of29June1993)andwasoriginallyrestrictedtocompaniesinindustrialsectors.
Since2001EMAShasbeenopentoalleconomicsectorsincludingpublicandprivateservices(Regulation(EC)No761/2001oftheEuropeanParliamentandoftheCouncilof19March2001).
AtthispointEMASrecognizedISO14001asequivalenttotheenvironmentalmanagementsystemrequiredbyEMAS.
ThementionedrevisionstoEMAShavemadeiteasierfororganisationsal-readycertifiedtoISO14001toattainEMASregistration.
Fortheseorganisa-tionstherewillbesomeminormodificationstobemaderelatingtothecoreelementsofISO14001plussomeadditionalstepsspecifictoEMAS.
AdditionalstepsforEMASregistration:1.
InitialEnvironmentalReview-TheEMASregulationrequiresthataninitialenvironmentalreviewbeperformedtoidentifyanorganisation'senvironmentalaspects.
However,whenanorganisationalreadyhasanEMScertifiedtoISO14001itdoesnotneedtoconductaformalenvi-ronmentalreviewwhenmovingontoEMASimplementation,solongastheenvironmentalaspects(includingbothdirectasindirectenviron-mentalimpacts)assetoutinEMASarefullyconsideredinthecertifiedenvironmentalmanagementsystem(EMS).
2.
EnvironmentalStatement-Theorganisationshallprepareanenviron-mentalstatement,basedontheoutcomeoftheEMSperformanceaudit.
Theenvironmentalstatementmustopenlyreporttheenvironmentalper-formanceoftheorganisation.
3.
VerifyingtheEnvironmentalStatementandenvironmentalperformance-InordertoattainEMASregistration,theEnvironmentalStatementShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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mustbeindependentlyvalidated.
ThisprocesswillcheckthatthestatementmeetstherequirementsofEMASandispubliclyavailable.
FromtheabovedescriptionitisobviousthattheEMASrequiresmoretrans-parencyoftheregisteredorganisationthanISO14001.
EMASrequiresthatthepolicy,programme,environmentalmanagementsystemanddetailsoftheor-ganisationsperformancearemadepubliclyavailableaspartoftheenviron-mentalstatement.
ISOonlyrequiresthatthepolicyispubliclyavailable.
Fur-therISO14001doesnotstipulatetheextenttowhichperformancemustbeim-proved.
EMASspecifiesthatorganisationsmustattemptto"reduceenviron-mentalimpactstolevelsnotexceedingthesecorrespondingtoeconomicallyviableapplicationofbestavailabletechnology".
Therefore,itismucheasierfromtheoutsideofacompanytocontroltheactualperformanceofanEMASorganisationcomparedtoonecertifiedaccordingtoISO14001ParticipationundertheEMASschemeisvoluntaryandextendstopublicorprivateorganisationsoperatingintheEuropeanUnionandtheEuropeanEco-nomicArea(EEA)—Iceland,Liechtenstein,andNorway.
Anincreasingnum-berofcandidatecountriesarealsoimplementingtheschemeinpreparationfortheiraccessiontotheEU.
ItispresentlynotpossiblefororganisationsinothercountriesoutsidetheEUtoberegisteredundertheEMASscheme.
However,accordingtoCommissionsources,thiswillprobablybechangedinthenextEMASrevisionwhichisbeingdrafted.
ThenewEMASisproposedtoallowregistrationoutsideEUandtoreinforcerequirementsforlegalcomplianceanddocumentationofperformanceimprovements.
ThenewEMASisexpectedtobeactivefrom2010.
5.
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4ApplicabilityofstandardsinshiprecyclingTheISO14001standardandtoalesserextenttheOHSAS18001standardarealreadybeingusedintheshipscrappingbusinesswithrecyclingyardsbeingcertifiedaccordingtothestandards.
Bothstandardsaregenericandarethusnotdesignedspecificallytoshipscrap-pingindustries,andsomefeaturesaboutthestandardareimportanttokeepinmindwhenevaluatingtheapplicabilityofthestandard.
TheEMASschemeislessrelevantbecauseitcanonlybeusedfororganisationswithintheEuropeanUnionandtheEuropeanEconomicArea(EEA)andsomeEUcandidatecoun-tries.
However,thismaybechangedinthenextrevisionofthestandard.
Firstofall,itisimportanttobearinmindthatISO14001isanenvironmentalmanagementstandardandOHSAS18001isanoccupationalhealthandsafetystandard.
CertificationtowardsISO14001doesthereforenotincluderequire-mentsonpropermanagementoftheworkingenvironmentforworkersatthesiteandviceversaforOHSAS18001.
Secondly,itshouldbestressedthatbothstandardsareproceduralasopposedtoperformancestandards.
Therefore,byitselfcertificationagainstthestandarddoesnotguaranteeacertainhighlevelofperformance.
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standardmeansthatthestandardsrequirementsarereferringtheorganisation'smanagementsystem(proceduresetc.
)andnotthelevelofperformance.
TheminimumrequirementofanISO14001certifiedorganisationislegalcompli-ancetoenvironmentalregulationsandcontinuousimprovement.
Thespeedandscopeoftheimprovementsishoweveruptotheorganisationitself.
Theabovementionedrequirementofthestandardsabouttheregulatorycom-plianceisanotherimportantissue,whenevaluatingtheapplicabilityofthemtowardsensuringsoundenvironmentalmanagementwithinshipscrappingbusinesses.
ManyofthelargeshipscrappingbusinessesarelocatedinpartsoftheworldwheretheEHSlegislationandregulatoryframeworkarenotfullydeveloped,whichmeansthatEHSregulatorycomplianceofacertifiedcom-panyinforinstanceAsiacaneasilyallowforunacceptableEHSperformanceaccordingtoforinstanceEuropeanenvironmentallegislativerequirements.
Finally,averyimportantissueisthefactthatbothISO14001andOHSAS18001allowforanorganisationtocertifyonlypartofitsactivities.
Becauseofthis,afirmcanchoosetobringonlyapartofitsenterpriseandbusinessactivi-tiesundertheregimeofthestandard,therebyleavingprocessesthataremoredifficulttomanageandimprovefromanenvironmentalperspectiveoutsidethescopeofitscertificate.
Suchproceedingscanleadtoseriousmisunderstandingsaboutthevalueoftheenvironmentalmanagementsystem.
Thereforeitisnotenoughtocheckifanorganisationiscertifiedaccordingtothesestandards.
Itisalsonecessarytochecktheactualcertificatetoseewhichpartoftheorganisa-tioniscovered,andpossiblytocheckthedocumentsbehindtofullyunderstandthescopeofthecertification.
Thisinformationis,however,oftennotavailableasthestandards(exceptEMAS)onlyrequiresthepolicytobepublicavailable.
EMASrequiresthatthepolicy,programme,environmentalmanagementsystemanddetailsoftheorganisation'sperformancearemadepublicavailableaspartoftheenvironmentalstatement.
Furtherthestatementisverifiedbyanexternalthirdpartcertifiedauditor.
Thereforeitisalwayspossibletocontroltheenvi-ronmentalperformanceofanEMASregisteredcompany.
Acertifiedmanagementsystemdoesnotguaranteeacertainlevelofperform-anceexceptfromlegalcompliance.
Thereforeitisnecessarytoestablishdocu-mentationofbestpractise/bestavailabletechnology.
Withthisinhanditwillbepossibletoevaluatetheperformanceofaship-recyclingcompany.
Suchdocumentationcanbeusedbybothlocalauthoritiesinthepermittingprocessandbyshipownersseekingaproperrecyclingfacility.
Acertifiedmanagementsystemisvaluableasitsetstheframeworkforanor-ganisation'senvironmentalorhealthandsafetywork,butseenfromtheoutsideitneedstoincludearequirementfortransparentreporting(liketheEMASscheme).
Andwhenitcomestoevaluationofperformanceitisalsoneededtohavedocumentationofbestpractise/bestavailabletechnology.
Further,itwillbevaluabletohaveguidelinesforlocalauthoritiesonhowtohandlepermittingandinspectionandguidelinesforshipownersonhowtohandletherecyclingprocess.
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5.
2.
5ExistingcertificationsofrecyclingyardsAsmentionedanumberofshiprecyclingfacilitiesareapparentlyalreadycerti-fiedaccordingtooneoftheabove-mentionedstandards.
ThereishowevernocombinedinternationalregisterofcertifiedcompaniesaccordingtoISO14001orOHSAS18001.
AregisterofEMASregisteredorganisationsexistsontheEMAShelpdesk(http://ec.
europa.
eu/environment/emas/tools/contacts/helpdesk_en.
htm),butnoshiprecyclingyardswerefound.
AbriefsearchontheInternetandafewotheravailabledatasourceshavebeenperformedwiththeresultlistedinthetablebelow.
Itshouldbenotedthatthelistisnowherecomprehensive.
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Table5-1ExistingISO14001and/orOHSAS18001certifiedrecyclingfacilitiesasidentifiedthroughasearchontheinternet,interviewsandotheravailabledatasourcesCountryRecyclingyardCertificate/standardCertificationCanadaInternationalMarineSalvageISO14001InformationBulletinonShipDemolition#6,Sept/Nov2006asthefirstISO14001certifiedship-yardintheworld.
Docu-mentationnotfound.
IndiaShreeRamShippingIndus-tries,ShreeRamSteel&Roll-ingIndustries(unit2)andShreeRamVesselScrapPVT.
LTDISO9001,ISO14001andOHSAS18001certificationbyCISQ(Italy)IQNet(TheInternationalCertificationNetwork:www.
iqnet-certification.
com)http://shreeramgroup.
net/e_&_s_01.
htmR.
K.
Industries(Unit2)ISO9001,ISO14001andOHSAS18001certificationbyCISQ(Italy).
IQNet(TheInternationalCertificationNetwork:www.
iqnet-certification.
com)BaijinatMelaramShipBreak-ers,BhavnagarISO14001MentionedonyardhomepagebyRINA(Italy)PriyaBlueIndustriesPVTLTDISO14001MentionedonyardhomepagebyICS(India)32identifiedcompaniesatAlangISO14001andOHSAS18001AccordingtoinformationfromGujaratMaritimeBoardandcashbuyerGMS.
Nofurtherinforma-tionhasbeensupplied.
ChinaXinhuiShuangshuiShip-breaking&Steel.
Co.
Ltd(SBSTEEL)ISO14001andOHSAS18001Certificatespostedonwebsite.
http://www.
sbsteel.
com/FILE/certificate.
htm.
JiangmenCityZhongxinShipbreakingSteel&IronCO.
,LtdISO14001andOHSAS18001BeijingWorldStandardCertificationCentersur-veillanceaudit(China)http://www.
greenshipbreaking.
com/JiangyinChangjiangXiagangShipbreakingCompanyISO14001andOHSAS18001P&ONedlloyd(nowMaersk)partnerXinRongRecycling&Logis-ticsCo.
Ltd(formerlyJiangsuChangrongSteelCo.
)ISO14001andOHSAS18001ABSQualityEvaluationsAvailableathttp://www.
changrongsteel.
com/GuangzhouPanyuShipBreaking&SteelRollingCo**ISO14001andOHSAS18001IndicatedbyCNSAonZhuhaiMEPCseminarTurkeyLeyalShipDismantling&Re-cyclingISO9001,ISO14001andOHSAS18001CertificationbyNQA(UK)http://www.
leyal.
com.
tr/photo.
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Forseveraloftheabovementionedyardsmoredetailsonthecoverage,con-tentsetc.
ofthecertificatesweresoughttogetherwithinformationoftheactualenvironmentalperformanceoftheISO14001certifiedcompanies.
Suchinfor-mationwashowevernotavailable,whichjustunderlinesthedifficultiesofreallyevaluatingthelevelofperformanceofthecompaniesandthustheimpli-cationsofthecertificates.
5.
3EuropeanUnionguidanceAsdescribedinthepreviouschapter,theEUWasteShipmentRegulationspe-cificallymentionsvesselsinitsAnnexIIIasacceptabletoexportonce'prop-erlyemptied':Vesselsandotherfloatingstructuresforbreakingup,properlyemptiedofanycargoandothermaterialsarisingfromtheoperationofthevesselwhichmayhavebeenclassifiedasadangeroussubstanceorwaste.
ThereisnoEUguidancerelatedtothecleaningofvesselsforexport,butsev-eralmemberstateshaveinitiatedactivitiesonthisissue,notablytheNether-lands,France,DenmarkandtheUnitedKingdom.
5.
3.
1TheNetherlandsTheNetherlandshaveobtainedpracticalexperiencewithrecyclingofcontami-natedshipsandpre-cleaningofshipsasaresultofthetwoshipsSandrienandOtapanbeingleft/arrestedinthePortofAmsterdamandtakenoverbytheDutchGovernment.
TheOtapancaseisdescribedinmoredetailinChapter1.
5.
3.
2FranceInpreparationfortheplannedexportoftheformeraircraftcarrierClemanceaupre-cleaningwascarriedoutbyFrenchcontractorsinthePortofToulon33:"Allthenecessarytechnicalandindustrialmeanswereimplementedtoguaran-teetherespectoftheobjectivessetbyInternationalandEuropeanenviron-mentalregulations,eventhoughtherearenoEuropeanorInternationalbindingregulationsregardingshipclean-upordismantling.
ThedismantlingyardisalsocertifiedwithISO14001onenvironmentalmanagementsystems.
"Theeffortsconcentratedonasbestos,sludge,oilandradioactivematerials:"Priortothedismantlingprocess,theformerClemenceau'shullwasprocessedanddoesnotcontainanymore:33DismantlingoftheformeraircraftcarrierClemenceau(PressDocketMINISTREDELADFENSE,January32006)ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Hydrocarbons:allpartsoftheaircraftcarrierwithexistingorprevioushydrocarbonswereleachedandhadtheirtanksemptiedbetweenOcto-ber1997andJanuary1998.
Theconcernedpartswerethenfilledwithfreshwater.
Polychlorobiphenyle(PCB)/pyralene.
LikeallthetransformersonFrenchNavyships,theformerClemenceautransformerswere"dry"transformersmeaningthattheydidnotcontainsuchsubstances.
The1,238indicativeradioluminescentplatesontheformerClem-enceauwereallremovedbeforethebeginningoftheasbestosremovalworks.
"Proceduresandstandardsforpre-cleaningareembeddedinenvironmentalleg-islationandnospecificprocedureaddressingthishasbeendeveloped.
Asmen-tionedearlier,asignificantefforthasbeenmadebytheInterministerialWork-ingGrouponidentifyingtheneedandcapacityofEuropeanshipscrapping.
TheplanneddismantlingofanavalvesselLuciferIIin2007willtakeplaceinCherbourgatasitewhereobsoletenuclearsubmarinesarealreadydismantled(AssembléeNationale2007).
5.
3.
3DenmarkTheDanishEPAhavebeenactiveinshiprecyclingforanumberofyears.
TheirworkhasincludedinvestigationofavailableshipscrappingcapacitywithinOECD-countries.
Thelatestinitiativeincludesdevelopmentofadraftbrief"pocket-book"versionoftheexistingTechnicalGuidelinesfortheEnvi-ronmentallySoundManagementoftheFullandPartialDismantlingofShipspublishedbytheBaselConventionin2003.
Thispocketbookprimarilyaimedattheoperatorsofyardsinterestedinenter-ingthemarketforgreenrecyclingthroughupgradingofanexistingyard.
Theinformationinthebookisgivenatthelevelwherethemanagementandtheircontractorscandeveloptheactualplanforupgradingbasedontheguidanceandtheinformationsourcesgiven.
Thepocketbookdoesnotinitselfincludeacertificationsystemandthirdpartyaccreditation,butisinsteadasteptowardsdevelopmentofastandardforEHScertificationofrecyclingyards.
5.
3.
4UnitedKingdomTheUKGovernmentwasfacedwiththeissueofshiprecyclingin2003,whentheUSDepartmentofTransportationMaritimeAdministration(MARAD)ar-rangedtorecycle13ofitsredundantnavalvesselsataTeessidefacility(AbleLtd.
),andthepublicandlocalauthoritieschallengedthestatusofthepermis-sionsatthefacility.
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InthewakeoftheGhostfleetissue,theUKpublishedaStrategyandaConsul-tationPaperandcarriedoutaninventoryofshipdismantlingcapacityintheUK.
WithrespecttoGovernmentownedvessels,theStrategyandConsultationpaperemphasises(UKDefra2007)thatwhen"GovernmentownedvesselsareeithersoldforfurtherusetootherGovernmentsorcommercialentities,orre-cycled,thefollowingcommitmentswillapply:thesalescontractforavesseldestinedforfurtherusewillcontaincon-ditionstoensurethatthenewownertakesfullresponsibilityforthesafeandenvironmentallysoundrecyclingofthevessel;recyclingwillonlybeallowedinafacilityinanOECDcountryandinaccordancewithacceptableenvironmental,healthandsafetystandards;and,vesselsexportedoutsidetheUKforrecyclingwillbesubjecttotheBaselConventionprinciplesofprior-informedconsentandenviron-mentallysoundmanagement.
"TheseconddocumentisanOverviewoftheShipRecyclingProcessintheUK.
ItsetsoutthetechnicalandregulatoryrequirementsforoperatingsustainableshiprecyclingfacilitiesintheUK.
Inaddition,anon-exhaustivelistofpotentialsourcesofassistance,includingfunding,forthosewishingtoengageinthein-dustryisprovided.
TheUKGovernment'sviewisthatexistinglegislationonwastedoescovershiprecyclingregardlessofwhethertheshipsailsunderownpowerorhastobetowed.
TheStrategyrequiresanyshipsentforrecyclingfromtheUKtoberecycledatayardthatoperatesaccordingtostandardsofenvironmentallysoundmanagement.
TothisendtheStrategyisavailableinfivelanguagesinadditiontoEnglishTherearethreekeyprovisionsrelevanttoshipownersoutlinedintheStrategy.
Firstly,anyUK-flaggedvesselbeingexportedforrecyclingfromaUKportwillhavetobenotifiedaccordingtotherequirementssetoutintheWSRasdescribedabove.
Secondly,allimportofvesselsintotheUKforrecyclingwillalsobesubjecttotheprovisionsoftheWasteShipmentRegulations(orexist-inginternationalrules).
Finally,UKshipownersareencouragedtorefertotheIMOGuidelinesonShipRecyclingatallstageswhenashipissoldforrecy-cling.
5.
4GuidanceinothernationsMostofthelargeshipscrappingnationshavedevelopedorareworkingonde-velopingspecificguidelinesorstandardsdescribingproceduresforscrappingofshipswithintheircountry.
Belowarepresentedtheidentifiednationalguide-lines.
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5.
4.
1IndiaTheCentralPollutionControlBoardinDelhihaspreparedenvironmentalguidelinesforshipscrappingindustriesaimingtominimizetheeffectoftheindustriesonthesurroundingenvironmentthroughproperlocationofindustriesandbypreparingandimplementinganenvironmentalmanagementplanandadisastermanagementplan.
Theguidelinesincludeadescriptionoftheappropri-atepollutioncontrolmeasuresregardingsolidwaste,airpollution,waterpollu-tionandnoise.
Thisalsoincludesaspectsofworkers'safety.
Since2000,theGujaratMaritimeBoard,GMB,hasissuedregulationscoveringsafetymeasuresforthebeachingofvessels.
Substanceoftheregulationwasthedocumentationofagas-freecertificatebeforebeachingandapermissiontostartthecuttingoperationstobeissuedbyGMBfollowingtheremovalofhaz-ardousmaterialsfromthevessel.
Thegas-freecertificatewasintroducedin2001.
Apartfromthethird-partygas-freecertificatesnocertificationsystemorthirdpartyaccreditationexists.
TheGujaratMaritimeBoardhasissuedConditionsandProceduresforGrant-ingPermissionsforUtilisingShipRecyclingPlots,dated30September2006.
ScheduleV(Miscellaneous)containsthefollowingcondition:"(6)Permissionholdershallusemoderntechnologyforrecyclingactivitylikeuseoflongnozzlecuttingtorch,mechanisedhydraulicliftingequipments,useofgasdetectors,mechanizedblowers,classifiedcuttingequipmentsetc.
andwhichmaybeprescribedbyGujaratMaritimeBoardfromtimetotimeandac-cordingtothenormsprescribedbyBasalConventionshallhavetobestrictlyobserved"(GMB2006).
5.
4.
2ChinaTheStateEnvironmentalProtectionAdministration(SEPA)haspublishedatechnicalmanualonpreventingpollutionfromshipdemolition.
SEPAhasiniti-atedworkonregistrationoftheChineseshipscrappingfacilitieswiththeob-jectivestoranktheseaccordingtotheirenvironmentalstatus.
Therankingwill,reportedly,belinkedtoshipscrappinglicences.
Furthermore,SEPAisabouttosetupaschoolonshipscrapping(Blankestijn,2004).
In1991,theChinaNationalShipRecyclingAssociation(CNSA)wasestab-lishedtotakeuptheresponsibilityoforganizing,managing,co-ordinatingandservingthistrade,andassistSEPAtoobserveandsupervisethepollutionprob-lemsarisingfromshiprecycling.
CNSAhavedrafted"Generalregulationsongreenshiprecycling"(availableonlyinChinese),whichhasbeeninforcesinceJune2005.
Intheautumnof2006,CNSAcarriedoutatrialonshiprecyclinginaccor-dancewiththedraftIMOconventiononshiprecycling.
ThetrialtookplaceatChangJiangShipBreakingYardonthecontainershipNedlloydDubai.
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objectivesofthetrialwastofindoutthedifferencesbetweenChineseshipre-cyclingindustrystandardsandinternationalstandards,andtoevaluatetheaf-fectstheconventionbroughttotheChineseshiprecyclingindustry.
Further-more,theintentionwastostudypreparatorymeasures,andtoimproveoccupa-tionalsafetyandhealthaswellasenvironmentprotectionintheshiprecyclingindustry(BIMCO2007).
CNSApreparedadetailedschemeforthetrial,withthedraftconventionasamendedbyMEPC54asbasis,andtherelevantshiprecyclingguidelinesasreference.
Accordingtorecentinformation(BIMCO2007)thetrialwasconsid-eredasuccessanditwasconcludedthattherecyclingoperationofthevesselessentiallycompliedwiththerelevantguidelinesandthedraftconvention-mainlybecauseoftheyardbeingcapabletodothis,andtheshipownerkeepingstrictsuperintendenceofthewholerecyclingprocess.
Basedonobservationsfromdelegatesonsiteforthetrial,thereisnoreasontobelievethatChineseyardswillhavedifficultiescomplyingwiththe(expected)requirementsoftheIMOconvention–alsointheinterimperiodfromtheapprovaluntilenteringintoforce(BIMCO2007).
ChinaNationalShipbreakingCorporationJiangyinChangjiangXiagangShipbreakingCompanyistheyardupgradedandusedbyP&ONedlloyd.
Ithasdocumentedproceduresandformalcertification.
5.
4.
3BangladeshAnationalregulatoryframeworkformanagingshipscrappingiscurrentlytobeestablished.
ThisreportedlyincludesanapprovalprocedureforthesiteoperatorundertheresponsibilityoftheMinistryofCommerceandIndustry,issuinga"berthingcertificate"foreachindividualvesseltobescrappedanda"hotwork"certificate.
Presently,however,notallyardsareregisteredwiththismin-istry.
Further,thereisaprovisionundertheEnvironmentalLawof1997requiringthateachandeveryindustryincludingthatofshipbreakingmusthaveanenvi-ronmentalclearancecertificatefromtheDepartmentoftheEnvironment,Min-istryofForestandEnvironment.
Toachievethis,theshipbreakingsitemustestablishanenvironmentalmanagementplan.
TheEnvironmentalLawisalsotocoversafetymeasures,occupationalhealth,wastemanagement,monitoringprogrammesanddisastermanagement.
ILOhasperformedaprojectonSafeandEnvironment-friendlyShipRecycling(SAFEREC)inBangladesh(ILO2003).
Accordingtothisprojectthereisverylittleimplementationoftheabove-mentionedregulationintheyardsandnoenforcementofthe"hotwork"requirement.
5.
4.
4UnitedStatesofAmericaTheUnitedStatesEnvironmentalProtectionAgency,USEPAhasdevelopedasetofguidelinesforshipscrappingintheUnitedStates.
Theguidelines,'AShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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GuideforShipScrappers:TipsforRegulatoryCompliance'wereissuedinthesummerof2000(USEPA,2000).
Theguidelinesareacomplianceassistancetool,intendedtoprovidesitesuper-visorsatshipscrappingfacilitieswithanoverviewofthemostpertinentenvi-ronmentalandworkershealthandsafetyrequirementstoassisttheminensur-ingcomplianceattheirfacility.
OSHA,theUSOccupationalSafetyandHealthAdministrationobviouslyalsohasregulationsapplicabletoshiprecyclingandworkstogetherwiththeEPAontheissue.
SixactiveshiprecyclingfacilitiesexistintheUSin2006.
TheseareapprovedbyMARADtorecycletheiroldvesselsofwhichmorethan100arefromtheso-calledghostfleet.
Thesefacilitiesareapparentlynotopentoforeignvessels,buttheyardsdopursuethisissuewiththeauthorities.
5.
5Recyclingpoliciesandstrategiesofprivateshippingassociationsandcompanies5.
5.
1InternationalChamberofShipping,ICSTheInternationalChamberofShipping,ICSistheinternationaltradeassocia-tionformerchantshipoperators.
InFebruary1999,theIndustryWorkingPartyonShipRecycling,IWPSRwasestablishedundertheco-ordinationofICS.
IWPSRpublishedtheirpreliminaryIndustryCodeofPracticeonShipRecy-cling(ICPSR)inAugust2001(Marisec,2001).
ThefocusofICPSRisonissuesrelatedtopreparationoftheshipforrecycling,withaprimaryfocusonhazardousmaterialsonboardtheshipandtheregistra-tionandminimisationofthepresenceofthesebeforedeliveryforrecycling.
OfthemoretangiblecontentsofICPSRisaninventoryofpotentiallyhazardousmaterialsonboardaship,consistingoftwolists,whichhavelaterbeenin-cludedintheIMOguidelines.
TheICPSRhasnostatutoryeffectstowardsshipowners,buttheindustryor-ganisationsinvolvedinthedevelopmentofthecodearecommittedtoencour-agethewidespreaduseofitwithintheindustry.
Thecodeofpractisedoesnotincludeacertificationsystemorthirdpartyaccreditation.
ICSleadsthebroadlybasedinter-industryworkinggrouponshiprecycling.
TheiropinionisthatsomeareasoftheexistingIMOCodeonshiprecyclingshouldbemademandatory-forexample,gasfreeingofcompartmentspriortodeliveryatrecyclingyardsandthemaintenanceofinventoriesofhazardousmaterials(greenpassports).
Moreovertheindustrysupportsestablishmentofasystemofapprovedrecyclingyards,demonstratingwhichfacilitiesmeetac-ceptablesafetystandards,towhichreferencecanbemadewhennegotiatingthedisposalofships(ICS2007).
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5.
5.
2BalticandInternationalMaritimeCouncil,BIMCOTheBalticandInternationalMaritimeCouncil(BIMCO)istheworld'slargestprivateshippingorganisationwithitsownermemberscontrolling65%oftheworldmerchantfleet.
BIMCOhasrecentlyreleasedtheirpolicyonshiprecy-cling(BIMCO2007).
ThispolicyexpressesthatBIMCObelievesthatshipre-cyclingisthemostenvironmentallyfriendlywayofdisposingofshipsandifproperlyhandledBIMCOseestheshiprecyclingindustryasa"greenindustry".
BIMCO'spolicyexpressesthesupporttotheimplementationofalegallybind-ingIMOinstrumentonshiprecyclingasthemostappropriatesolutionforshiprecyclingissues,takingintoconsiderationviewsoftheBaselConventionandILO.
BIMCO'spolicyfurtherencouragestheindustrytousetheDEMOLISHCONcontractwhensellingshipsforrecycling.
BIMCO'spolicyexpressestheviewthatitismainlyfortheauthoritiesoftheflagstatestocertifyshipsreadyforrecycling.
5.
5.
3IntertankoIntertankoistheInternationalAssociationofIndependentTankerOwners.
Theorganisationhas250members,whosecombinedfleetcomprisesmorethan2,500tankerstotalling210millionDWT,whichis70%oftheworld'sinde-pendenttankerfleet.
IntertankohasinSeptember2006announcedtheadoptionofan"InterimStrategy",accordingtowhichshipownersshouldonlyuserecy-clingfacilitiesthathavemadedemonstrableadvancesintermsofsafetyandenvironmentalmanagementrequirementsasestablishedinSectionCofthedraftIMOConvention.
5.
5.
4PrivatecompaniesAnincreasingnumberofprivateship-ownersaregettinginvolvedintheworkonensuringenvironmentalsoundandsaferecyclingoftheirships.
Anumberofcompanieshavepreparedinventoriesofhazardousmaterialsin(someof)theirexistingshipsandnew-builds,greenpassports.
Thelistbelowincludesshipsforwhichgreenpassportshavebeenprepared.
Thelisthasbeenpreparedfromsearchesontheinternetandotherreadyavail-abledatasourcesandisnotexpectedtobecomprehensive:25LNGCarriersmanagedbyShellInternationalTradingandShippingCompanyLtd.
Aida(CarCarrier,WalleniusLines)ArcticDiscoverer(LNGCarrier,K-Line)Oneexistingvesselineveryclasseveryyear(BPShipping)3Containerships(MaerskLineLtd.
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StenaSeatrader(Ro-Pax,StenaLines).
RegardingshiprecyclingBPShippinghasdevelopedstandardsofitsownforshiprecyclingthatincludetheremovalofasmuchhazardousmaterialaspossi-blefromvesselsbeforerecyclingandauditingrecyclingfacilitiesusingBPgrouphealth,safetyandenvironmentalcriteria.
BPShippingauditorsnormallywitnesstherecyclingprocessandviewtheconditionsofthefacilitypriortotheiruseaswellasvisitingsecondarylocationssuchasasbestosdisposalsites.
Allrecyclingfacilitiesareauditedatleasteverythreeyears.
Whennecessary,asintherecyclingoffourBPShippingtankersinSpainin2004,aBPShippingShipyardHealthSafetyandEnvironmentSuperintendentoverseestheactualdeconstructionofavessel(BPShipping2006).
TheshippingcompanyP&ONedlloyd(nowpartofMaerskLine)havetakenanotherapproachinformingapartnershipwithtwoChineseshipscrappingfa-cilitieswhoseenvironmentalandsafetystandardswereupgradedviatechnicalassistanceandtraining.
Thepartnershipincludesanagreementonscrappingofthecompanies'shipsagainstcommonagreedHSE-standardsandprocedures.
P&ONedlloydinitiallyscrapped19shipsatthesetwoChinesefacilitiesin2000-2003andnowasapartoftheMaerskLinecontinuestouseoneofthefacilitiesfortheirrecyclingdemand.
ProposalsfornewproceduresandpoliciesleadingtosaferdismantlingareinparticularpartoftheworkoftheEUfinancedprojectSHIPDISMANTL,butalsotheSAFETOWandSHIPMATESstudiesaddressrelatedtechnicalissues.
Improvementsandprocedureshavealsobeenpublishedinthetechnicallitera-tureforTurkey(Neseretal2006)andSouthAsia(Wijngaarden2006).
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6End-of-lifeships:hazardouswasteorpre-cleaned6.
1IntroductionIninternationalwasteshipmentlawitisrecognizedthatashipmaybecomewasteasdefinedinArticle2oftheBaselConventionandthatatthesametimeitmaybedefinedasashipunderotherinternationalrules.
34ThedefinitionofwasteinEuropeanCommunitylawalsoappliestoshipssentfordismantling.
AccordingtothelawwastemeansanysubstanceorobjectinthecategoriessetoutinAnnexItotheWasteFrameworkDirective35whichtheholderdiscardsorintendsorisrequiredtodiscard.
Ifavesselcontainsconsiderablequantitiesofhazardoussubstances,orinthewordsoftherelevantwasteentryGC030,hasnotbeen"properlyemptied"ofhazardousmaterials,itwillbeconsideredashazardouswaste.
TheexportofsuchavesselforscrappingfromtheECtoanon-OECDcountryisprohibitedundertheBaselBanamendmentandtheWasteShipmentRegulation,andanydismantlingmusttakeplaceundersafeandenvironmentallysoundconditionsinanOECDcountry.
Thealternativeistohavetheshipdecontaminated(pre-cleaned)insuchawaythattheshipnolongerconstitutesahazardouswaste.
ThislegalinterpretationwasconfirmedbytheFrenchConseild'EtatinthecaseoftheformeraircraftcarrierClemenceau.
36ShipsarethuspursuanttoAnnexIIoftheWasteShipmentRegulationconsid-erednon-hazardousiftheyfallundertheentryGC030'vesselsandotherfloat-ingstructuresforbreakingup,properlyemptiedofanycargoandothermateri-34BaselConventionDecisionVII/26,recital6;Regulation(EC)No1013/2006oftheEuropeanParliamentandoftheCouncilof14June2006onshipmentsofwaste,OJL190,12.
7.
2006,p.
1(recital35).
35Directive2006/12/ECoftheEuropeanParliamentandoftheCouncilof5April2006onwaste,OJL114,27.
4.
2006,p.
9.
36Decisionof15February2006,No288801-288811,see:http://www.
conseil-etat.
fr/ce/jurispd/index_ac_ld0607.
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alsarisingfromtheoperationofthevessel,whichmayhavebeenclassifiedasdangeroussubstanceorwaste'.
Whattheterm"properlyemptied"meansisnotpreciselydefinedintheCom-munityRegulation.
Weareinthefollowingassessingbothlegallyandtechni-callyhowtheregulationterm"properlyemptied"maybeinterpreted,bothinrelationtocargoandothermaterialsarisingfromoperationoftheshipaswellashazardousmaterialsintheship'sstructureandequipment.
6.
2CommunitylawonhazardouswasteUnderCommunitylegislationhazardouswasteisdefinedas"wastesfeaturingonalisttobedrawnupinaccordancewithprocedureslaiddowninDirective75/442/EEConthebasisofAnnexesIandIIofDirective91/689/EEC.
"ThesewastesmusthaveoneormoreofthepropertieslistedinAnnexIIIofthesameDirective.
ThemostrecentversionofthatlistofhazardouswasteisincludedinCommis-sionDecision2000/532/ECaslastamendedbyCouncilDecision2001/573/EC.
Shipsoftencontainhazardousmaterials,whichcanendangertheenvironment,iftheyarenotmanagedinanenvironmentallysoundway.
Thesehazardousma-terialsarelistedashazardousentriesintheEUwastelistasincludedinCom-missionDecision2000/532/ECasamended.
AnnexVoftheWasteShipmentRegulationisrelevantwhendeterminingifashipmentofwasteissubjecttothebaninArticle16oftheWasteShipmentRegulation.
Article16oftheRegulationbanswastelistedinAnnexVifdes-tinedforrecoveryincountriestowhichtheOECDdecisiondoesnotapply.
InAnnexVthefollowinghazardousentriesrelevantforshipsdestinedfordis-mantlingcanbefoundinPart1,listA.
Table6-1belowcontainssubstances,whicharelikelytobefoundinrelativelylargeamountsinshipsforscrapping,andwhichishazardousaccordingtotheabovementionedregulation.
ThesubstancesinthetableisbasedonthelistofhazardousmaterialsmostoftenfoundinvesselspreparedbytheICSaspartoftheir2001shiprecyclingguidelines/ICS2001/.
Thetableincludesinformationofthehazardouspropertiesofthecompoundsandifsuchexist,concentrationlimitsforthehazardouscompound.
FurtherinformationontheBaselconven-tionclassificationisincluded.
AmorecomprehensivelistofcompoundsisfoundinappendixD.
BasedonthedatainTable6-1,itcanbeobservedthattheconcentrationlimitsforhazardousmaterialsrangesfrom0.
1%(1g/kg)fore.
g.
asbestosto3%(30g/kg)fore.
g.
tinintinbasedanti-foulingcoating.
PCBhasanexceptionallylowlimitof50mg/kgequalto0.
05‰.
Foranumberofsubstancesconcentra-tionlimitsdonotexist,e.
g.
substancesdangeroustotheenvironment.
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TheEUhazardouswasteclassificationrequiresthatthesumoftherelativecon-centrationsofhazardoussubstancescomparedtotheconcentrationlimitsshouldbelessthan100%.
Unfortunately,asmentionedabove,concentrationlimitsdonotexistforseveralofthehazardouswastefractionswhicharepre-sentinrelativelylargequantitiesinships,e.
g.
oilemulsionsandotheroilcon-tainingwastes.
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Table6-1Differenttypesofhazardouswastetobeidentifiedatships,classificationofpropertiesandtheirconcentrationlimitsinarelevantentity.
SubstanceClassificationofhazardousproper-tiesaccordingtoEUHazardousWasteClassificationDescriptionofconcentrationlimitsforhazardouswasteBaselConventionHazardClass,AnnexIIIBaselConvention,AnnexVIIIHalonsDependsonthetypeofhalons:Carbontetrachloride:T,Carc3Methylchlroide:FxYesifconc.
>3%H2RefrigerantssuchasR22/R12RegulatedaccordingtoRegulation2037/2000H2Fueloil,dieseloilandgasoilCarc.
3Yesofconc.
>1%H3RadioactivematerialsRadioactiveDependentonthetypeofradioac-tivematerialH7WasteleadacidbatteriesC(R35)Yesifcon.
>1%H8A1160AsbestosCarc1Yesifcon.
>0.
1%H11A2050PCBandPCTcontainingsub-stancesDangeroustotheenvironmentYes,ifcon.
>0.
005%H11A3180Tinbasedanti-foulingcoatingsToxicanddangeroustotheenviron-mentT:ifconc.
>3%H12A4030LubricatingoilsDependentonthetypeofoilbutmainlyCarc2Yesifcon.
>0.
1%H12A3020,A4060HydraulicOilsDependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12A3020,A4060Oilresidues(sludge),oilwatermix-tures,wasteoils,oilcont.
wasteDependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12PolyvinylChlorideNoneNothazardouswasteH13ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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6.
3Pre-cleaningThepre-cleaningconceptessentiallymeansremovalofhazardousmaterialsintheEUandconsecutiveshippingofthecleanedvesseltoashipscrappingloca-tionelsewhere,e.
g.
inAsiaorTurkey.
IthasbeenproposedanddiscussedasameansofsolvingtheEHSissuesintheshipscrappingbusiness.
ThisconceptwouldresultinthehazardousmaterialsbeingremovedinEurope,wheretech-nologiesandfacilitiesforsaferemovalandtreatmentofthehazardousmateri-alsexistandatthesametimeallowthemajorpartoftheworkintensiveshipbreakingtobeperformedinAsia,wherethelabourcostsaremuchlowerthaninEurope.
Thefeasibilityofthepre-cleaningconcepthashoweverbeenquestionedfromvarioussides,bothfromatechnical,safetyandeconomicangle.
Someoftheargumentsagainsttheconceptarerelatedtothefactthatthepre-cleaningcon-ceptincludestowing,asgraduallyremovalofhazardousmaterialsfromashipatonepointwillmaketheremainingstructurenotship-shape(unabletosailforownpower).
Removalofmaterialsfromtheshipbeyondthispointwillresultintheship'shavingtobetowedwhentransportedfromEuropetoAsia.
Thecoreofthefeasibilitydiscussioncanbesynthesizedintothefollowingsce-nariosandtheirinternallocationonthe"pre-cleaningladder"asillustratedinFigure6-1below:Pre-cleaningtoacontentwheretheshipisstillship-shape(self-propelled)Pre-cleaningtoacontentsatisfyingthe"properandnecessarycleaningmeasures"oftheEUwastelawPre-cleaningtototallyremoveallhazardousmaterialsintheship.
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Figure6-1"Ship-cleaningladder".
NOTE:randominternalplacingofthe"Self-propelled","Towingneeded"and"ProperemptiedaccordingtoEUwastelaw"6.
3.
1"Ship-shape"conditionShipshavetofulfilthecurrentsafetyrequirementstobeissuedwithpropercer-tificatestobeallowedtosailundertheirownpower.
TheSOLASConvention(IMO1974)isgenerallyregardedasthemostimportantofallinternationaltreatiesconcerningthesafetyofmerchantships.
TheSOLASConventionspecifiesminimumstandardsfortheconstruction,equipmentandoperationofships,compatiblewiththeirsafety.
FlagStatesareresponsibleforensuringthatshipsundertheirflagcomplywithitsrequire-ments,andanumberofcertificatesareprescribedintheConventionasproofthatthishasbeendone.
ControlprovisionsalsoallowContractingGovernmentstoinspectshipsofotherContractingStatesiftherearecleargroundsforbeliev-ingthattheshipanditsequipmentdonotsubstantiallycomplywiththere-quirementsoftheConvention-thisprocedureisknownasportStatecontrol.
ExamplesofthesafetyrequirementsintheConvention:subdivisionofpassengershipsintowatertightcompartmentsmustbesuchthatafterassumeddamagetotheship'shullthevesselwillremainafloatandstable;watertightintegrityandbilgepumpingarrangementsforpassengerships;stabilityrequirementsforbothpassengerandcargoships;ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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firesafetyprovisionsforallshipsandspecificmeasuresforpassengerships,cargoshipsandtankers,includingamongothers:-requirementsfordivisionoftheshipintomainandverticalzonesbythermalandstructuralboundaries;-separationofaccommodationspacesfromtheremainderoftheshipbythermalandstructuralboundaries;-restricteduseofcombustiblematerials;-readyavailabilityoffire-extinguishingappliances.
Howmanyhazardousmaterialscanberemovedfromashipwhilestillkeepingitinaship-shapeconditiondependsontheactualcase.
Itwillingeneralbepossibletoreplaceonehazardousmaterial/componentwithanothernon-hazardousmaterial/componentwiththesamefunction.
Thiscouldintheorymeanreplacingfire-retardantasbestoswithanothernon-hazardousfire-retardantmaterial,e.
g.
glasswool.
Itwillhowevernotbepossibletore-placefire-retardantmaterialwithfire-fightingequipment(EMSA2007).
Specialcasesexistwhereitispossibletochangethestatusofaship,e.
g.
apas-sengershipchangingstatustoforinstancecargoshipbeforethelastjourney.
Forthisitwillbepossibletopre-cleanforinstancethepassengersectionsoftheship,e.
g.
removethefire-retardingasbestosfromthepassengercabinsandcloseoffthesesections(EMSA2007).
Anoftendiscussedwastefractioninrelationtopre-cleaningispaint.
Aslongaspainthasnosafetyfunctionlikeforinstancefire-retardingpaint,itcanbere-movedandstillkeeptheshipinship-shapecondition.
Thisincludespaintontheoutsidehull,butalsoantifoulingpaintunderthewaterline.
Pre-cleaningofashiptoalevelwhereitisstillship-shapewillinmostcasesnotbesufficienttomeettheEUwasteshipmentlaw'srequirementof"properlyemptied".
Thiscanmosteasilybeseenfromthefactthatoil,includingbunkeroil,hastoberemovedfromtheship,whichrenderstheshipunabletosailun-deritsownpower.
6.
3.
2TowingWhenevermaterialorcomponentshavebeenremovedfromaship,whichhavemadeitunabletomeetthesafetyrequirementsdiscussedabove,thepre-cleanedshipwillhavetobetowedtothefinalbreakinglocation.
Nointernationalguidelinesexistforapprovingshipsfortow.
Suchshipsneedtobeapprovedbyarecognisedclassificationsocietywhochecksthesafetyconditionsoftheshipinrelationtotheproposedtow(EMSA2007).
E.
g.
inDenmarkthefollowingrequirementsneedtobefulfilledbythepre-cleanedship(similarrequirementsexistinternationally):Fulfilmentofloadline(stabilitycalculations/test);Mountingoftowingarrangements,includingsparearrangements;ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Mountingofappropriatelanterns.
Fromatechnicalpointofviewalmostallmaterial/componentscanberemovedfromashipwhilestillkeepingitinatowableconditionaslongaspartsoftheprimaryshipstructurearenotremoved.
Thismeansforinstancethatthemaindeckcannotberemoved(EMSA2007).
Towingofpre-cleanedshipswillbeassociatedwithadifferentrisk-patternthansailingofshipsforitsownpower.
Thisdifferentrisk-patternisdescribedandquantifiedattheendoftheChapter.
Incaseswherenohazardousmaterialsarelocatedinsidetheprimarystructureoftheship,atotalremovalofallhazardousmaterialsispossible.
Betweenthetwoextremes,theshipasitistodayandthetotallypre-cleanedship,areseveralintermediatesituations,includingthesituationofremovingasmuchaspossibleofthehazardousmaterialsinordertofulfilthe"properlyemptied"requirementofEUwastelaw.
6.
3.
3"Properlyemptied"BasedonthedatainTable6-1,itcanbeobservedthatEUwastelawincludesconcentrationsrangingfrom0.
1%(1g/kg)fore.
g.
asbestosto3%(30g/kg)fore.
g.
tinbasedanti-foulingcoating.
PCBhasanexceptionallylowlimitof50mg/kgequalto0.
05‰.
Foranumberofsubstancesconcentrationlimitsdonotexist,includingsubstancesdangeroustotheenvironment.
ForcompoundswhereconcentrationlimitsexistEUwastelawdoesnotspecifywhatmaterialfractionthehazardouscompoundsshallbeseeninrelationto.
Thisisimportantinformationinordertobeabletocalculatetheconcentrationofthecompoundinthematerialfractionandfromthatevaluateifitistobeconsideredashazardouswaste.
Theproblemcanbeillustratedbyconsideringashipofcomparablesize(15,432LDT)totheoneusedintheeconomiccaseanalysisinchapter8.
Ifthisshipitselfasawholehastobeclassifiedashazardouswastebasedonthetotalamountofasbestosorthetotalamountoftin-basedantifoulingcoating,theto-talamounthastobeabove15.
4tonsor463tons,respectively.
Theseamountsofthetwocompoundsarerequiredtobringthetotalconcentrationsabovetheconcentrationlimitstoclassifythewasteashazardous.
Theaboveexampleclearlyshowsthatthevolumeofhazardousmaterialsshouldnotbeevaluatedagainstthetotalshipweight.
Insteaditisappropriatetoevaluatetheamountofhazardousmaterialagainstthesmallestmaterialfrac-tion,whichcanbetakenoutoftheshipasaseparatefraction.
Suchsmallestseparatematerialfractionshavetobedecidedonacase-by-casebasis.
Exam-plescouldinclude:Thetotalexteriorpaintlayerontheoutsideoftheshiphull(couldconsistofseveraldifferentpaintlayers,butsuchcannotbeseparated);ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Totalwallpanelscontainingasbestos;ThePCB-containingoilintransformers(notthetotalweightofthetrans-former).
Forcompoundswherenoconcentrationlimitexists,thesmallestseparatemate-rialfractioncontainingthehazardouscompoundmustberemovedashazardouswaste.
Fromapracticalpointofviewamaximumallowablethresholdconcentrationlimitshouldbedefinedforcompoundswherenoconcentrationlimitsexist.
Thelimitcouldforinstanceberelevantinacasewhereforinstanceoiltanksareemptiedofoil,butthesestillcontaintracesofoil.
Suchlimitcouldbedefinedat0.
1%,whichistheconcentrationlimitforthemostdangerouscompounds(exceptforPCB,wheretheconcentrationlimitis0.
05‰).
6.
3.
4TechnicalfeasibilityAsstatedinSection6.
3.
2,thetheoreticalupperlimitforpre-cleaningofvesselsconsistsinremovingpartsoftheprimaryvesselstructure,asthiswillleavetheremainingstructureunfitfortowing.
Inpracticealowerlimitforpre-cleaningwillexist,wherepre-cleaningabovethislimitmostlikelywillbeunfeasible.
The"location"ofthispracticallimitforpre-cleaningwillhavetobeestablishedonacase-by-casebasis,butsomegen-eralconsiderationsonthelocationcanbeestablished.
Thefeasibilityofpre-cleaningwillbereducedwheneverplanningforremovalofdifficultaccessiblehazardousmaterials,whichwillincludebreaking-upofothernon-hazardousstructurestogetaccesstothehazardousmaterialsforremoval.
Themoreoftheseoperationshavetobedonetopre-cleanthevesselunderconsideration,thecloseronecomestothelimitwhereitwillbeeasierfortheshipownertobreak-uptheentirestructureatthe"pre-cleaningfacility".
Amorepronouncedcaseoftheseunfeasiblepre-cleaningmeasuresaremeas-uresthatinvolvebreaking-upofstructuresonthevesselthatwillhavetobereplacedafterwardstoenabletheremainingvesseltobeinatowablecondition.
Suchmeasureswillbecostlyandreducethefeasibilityofpre-cleaningofthevesselquitefast.
Pre-cleaningmeasuresthatresultinreplacementofotherstructuresinclude:removaloflargestructuresfromtheinnersectionsofthevessel,whichwillre-sultintheneedforcuttingholesintheouterstructuresthatwillhavetobeclosedagainafterwards,andremovalofstructuresthatstabiliseotherstructureswhichalsohavetoberemoved.
Themainengineisanexampleofalargestruc-turethatmostlikelywillbeunfeasibletoremove.
Alowerdecksupportingorstabilisingupperdecksisanotherexampleofastructurewhichwillbeunfeasi-bletoremovefromastability/structuralpointofview.
Thelocationofthispracticalfeasibilitylevelforpre-cleaningonthe"pre-cleaningladder"hastobedecidedonacase-to-casebasis.
AsbestoshasoftenShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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beenusedforfiresectioningstructuresincludingdecks,whichiswhyaloca-tionbelowthe"properlyemptied"levelisexpectedtoberathercommon.
Anothertechnicalissuethatisaffectingthefeasibilityofthepre-cleaningcon-ceptistheavailabilityofappropriatetowingvessels.
Basedontheprojectionoffuturescrappingrequirement,Chapter2,anestimateofupto200pre-cleanedvesselsayear,tobetowedfromEurope,canbeconsidered.
IfallthesevesselshavetobetowedtoAsia,itwillrequirearound66tug-vesselsworkingfull-time(basedonanestimateddurationofaround-tripof120daysincludingmo-bilisationtimeetc.
,seefollowingChapter).
Suchtugdemandwillresultintemporaryshortageoftugs,untilthedemandhasbeenmetbythesupplyofnewtugs.
6.
4Existingpre-cleaningguidelinesOtherorganisationsorgovernmentshavedevelopedguidelinesforpre-cleaningofships.
Theseguidelinesarenotdevelopedtocoverscrappingofships,butcanprovideinputtothediscussionofappropriatecleaningmeasures.
Someoftheseguidelinesaredescribedbelow.
6.
4.
1USartificialreefingofvesselsTheUSCodeofFederalRegulations,Title40,Volume12,Parts190to259asrevisedJuly1,1996,permitsinsection229.
1theburialatseaofvesselsandairplanesregisteredintheUnitedStatesorflyingtheUnitedStatesflagundercertainconditions,including:"appropriatemeasuresshallbetaken,priortodisposal,byqualifiedpersonneltoremovetothemaximumextentpracticableallmaterialswhichmaydegradethemarineenvironment,includingwithoutlimitation:(i)emptyingofallfuellinesandfueltankstothelowestpointpracticable,flushingofsuchlinesandtankswithwater,andagainemptyingsuchlinesandtankstothelowestpointpracticablesothatsuchlinesandtanksareessentiallyfreeofpetroleum,and(ii)removingfromthehullsotherpollutantsandallreadilydetachablematerialcapableofcreatingdebrisorcontributingtochemicalpollution".
Theclean-upgoalsarefurtherspecifiedinTable6-2.
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Table6-2USArtificialReefingofVesselsNarrativeClean-upGoalsforMaterialsofConcernMaterialofConcernNarrativeClean-upgoalOilandfuelRemoveliquidfuelsandoilsandsemi-solids(greases)sothat:novisiblesheenisremainingonthetanksurfaces(thisin-cludesallinteriorfittings,piping,structuralmembers);nofilmorvisibleaccumulationisremainingonanyvesselstructureorcom-ponent(e.
g.
,onmachineryorfromspillsondeckingorcarpet).
Theendresultofsuchclean-upshouldbethatnosheenbevisibleuponsinkingavessel.
AsbestosRemoveanylooseasbestosandasbestosthatmaybecomelooseduringvesselsink-ing;removeorsealaccessiblefriableas-bestos.
PolychlorinatedBiphenyls(PCBs)Removeallmanufacturedproductscontain-inggreaterthanorequalto(≥)50partspermillion(ppm)ofsolidPCBs;removeallliq-uidPCBsregardlessofconcentration;re-moveallmaterialscontaminatedbyPCBspillswheretheconcentrationoftheoriginalPCBsourceis≥50ppm.
PaintRemoveharmfulexteriorhullanti-foulingsystemsthataredeterminedtobeactive;removeexfoliating(peeling)andexfoliatedpaint.
Solids/debris/floatablesRemoveloosedebris,includingmaterialsorequipmentthatisnotpermanentlyattachedtothevesselthatcouldbetransportedintothewatercolumnduringasinkingevent.
OthermaterialsofenvironmentalconcernRemoveothermaterialsthatmaynegativelyimpactthebiological,physical,orchemicalcharacteristicsofthemarineenvironment.
6.
4.
2OSPARArtificialReefsGuidelinesTheOsloParisConventionforprotectionoftheNorthAtlantic(OSPAR)hasalsode-velopedguidelinesonartificialreefswithintheirterritory.
Theseguidelinesspecifythatartificialreefsshouldonlybeestablishedif,afterdueconsiderationofallsocio-economicandenvironmentalcosts(e.
g.
undesir-ableimpactsoralteration),anetbenefitcanbedemonstrated,inrelationtothedefinedobjectives.
Insuchassessmentofpotentialeffects(whichmayhavetobeaformalenvironmentalimpactassessmentifmajorimpactscannotberuledout)thefollowingstepsshouldbefollowed:ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Studiesshouldbecarriedoutthatyieldtheinformationrequiredtoassess:-possibleimpactsoftheinstallationofanartificialreefontheindigenousfaunaandfloraandtheenvironmentofthesiteandthewidersurround-ings;InrelationtotherequirementsforthematerialsforuseasartificialreefstheOSPARGuidelinesspecify:Artificialreefsshouldbebuiltfrominertmaterials.
Forthepurposeoftheseguidelines,inertmaterialsarethosewhichdonotcausepollutionthroughleaching,physicalorchemicalweatheringand/orbiologicalactiv-ity.
Physicalorchemicalweatheringofstructuresmayresultinincreasedexposuresforsensitiveorganismstocontaminantsandleadtoadverseen-vironmentaleffects.
Materialsusedfortheconstructionofpermanentartificialreefswillofne-cessitybebulkyinnature,forexamplegeologicalmaterial(i.
e.
rock),con-creteorsteel.
Nomaterialsshouldbeusedfortheconstructionofartificialreefswhichconstitutewastesorothermatterwhosedisposalatseaisotherwiseprohib-ited.
TheGovernmentsofFranceandtheUnitedKingdomhavedevelopedguide-linestocomplywiththeOSPARrecommendationsforcleaningofvesselstobeusedasshootingtargetsorforartificialreefs.
6.
5Riskassessmentoftowingofpre-cleanedshipsfromEuropetoAsiaAsdescribedearlierinthisChapter,pre-cleaningofshipsiscloselyconnectedtotowingasthepre-cleanedremainingstructureoftenwillbeinashapeunfitforsailingunderitsownpowerandwhichthenhastobetowedfromthepre-cleaninglocationtothefinalscrappinglocation.
Theobjectiveofthissectionistoassesstherisksoftowingofpre-cleanedshipsfromEuropetoAsia.
Tomeettheobjective,aquantitativeassessmenthasbeenmadeoftheriskoftotallossofatowedshipinconnectionwithtowingitfromLondoninEnglandtoAlanginIndia.
Tworoutesareconsidered,onethroughtheSuezCanalandanotheraroundtheCapeofGoodHope,asshowninFigure6-3and6-4.
Theroutesaredefinedfromthe"portworld"website(http://www.
portworld.
com/).
Thetwolocationshavebeenchosenasrepresen-tativesofaEuropeanportandamajorAsianscrappinglocation,respectively.
ChangestodepartureharbourswithinEuropeanddestinationswithinAsiawillaffecttheresultsonlymarginally.
Theriskoffatalitiesinconnectionwithatowingaccidentisalsoassessed.
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Figure6-2RouteLondon-AlangthroughtheSuezCanalFigure6-3RouteLondon-AlangaroundtheCapeofGoodHope6.
5.
1RiskassessmentTowingofshipsTowingisaroutineoperationfortugs.
Goodpracticeofseamanshipisneces-sarytoaccomplishthemissionwithoutendangeringthetow,tug,personnel,oroperationalschedules.
Whilenearlyalltransoceanicandcoastaltowsarecom-pleteduneventfully,emergencyconditionsmustbeexpected.
Properprepara-tionsmustbemadeforemergencyconditions.
Goodplanning,preparationforemergencysituationsandcorrectshiphandlingarenecessaryelementsoftow-ing.
Specialtowingmissionsgenerallytransitunprotectedcoastalwatersandtheopenocean.
ThesemissionsrequireconsiderablylargerandstrongertugsusingShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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heavierandstrongertowinggeartowithstandtheviolentstressesencounteredinopencoastalandoceanseas.
Normally,thesetugshavegreatertowingpower(largerenginesandoverallheavierequipmentandconstruction)andareequippedwithtowingmachinery,suchassingle-anddouble-drumwireropetowingwinches;towwireguides,rollers,andpinions;cranesorwinch/boomassembliestohandlethetowrigging;andasmallworkboatforboardingandinspectingthetowwhileenroute.
Towinggearforthesemissionsincludeheavychainbridlesandpendants(anchorchain),plateshackles,retrievingwires,emergencytowingbridles,towlines(hawsers),floodingalarms,pumps,andanchors.
TowingresponsibilitiesThecommandrequestingtowofcraftmustprovidethecraftinseaworthycon-ditionwithfloodingalarms,navigationlights,electricalpowerforalarmsandlights,salvagegear(anchorsandpumps),andtowinggear(bridle,pendant,andretrievingwires).
Forsuspectordeficientseaworthinessconditions,boththetowandtowingcommandmustagreeontheriskoftow.
Thecommandacceptingthetowmustprovidetugandtowinggeartoconnecttothetowedcraft'stowinggear.
Thetugandgearmustbeseaworthyfortheparticularmissionrouteandhavetheappropriatesize,horsepower,andcontroltosafelyandsuccessfullyaccomplishthetowingmission.
Onacceptingthetow,thetowingcommandacceptsfullresponsibility.
Beforeaccepting,seawor-thinessmustbeverified.
Thetowshouldberefusedifitisconsiderednotfitforsea.
Towingisacceptedonlyafterthetug'sofficerscompletedacomprehensiveevaluationandsurveyofthetow.
SeaworthinessTowingseaworthinessmeanssuitableconditionforthemission.
Thisconcernsallthevarioustechnicalimplicationsofthetowandtowingvessel,including:-Vesseldesignandspecifications.
Structuralconditionandstability.
Age,maintenancehistory,andstatus.
Reinforcementrequirements.
Hullandsuperstructureclosures.
Adequacyoftowinggear.
Dewateringfacilities.
Chafinggear.
Firefightinganddamagecontrolfacilities.
Repairparts.
Tow-boardingfacilities.
Emergencytowinggear.
Waterstobetransited.
Hazardsoftheroute.
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Acertificateofseaworthinessforoceantowsmustbecompleted.
Thecertifi-cateindicatesthegeneralcharacteristicsofthetow,typeofcargo,towinggear,lights,andemergencygearaboardthetow.
CategoriesofriskCommandingofficersofthetowingshipandthetowedcraftshouldagreetotheconditionsofriskintowingthecraft.
Riskconditionsarebasedontheseawor-thinessandstructuralconditionofthetow,expectedseaandweatherconditionsfortheroute,andthespecificationsofthetowingship.
Insummary,foreseeablehazardsareasaruleconsideredbythecommandingofficersinadvanceandsuitableprecautionarymeasuresaretakentoreducetheoccurrenceofaccidentaleventsduringthevoyage.
Accidentaleventscanstilloccurinspiteofprecautionsbecauseoftheinherentriskynatureofthetowingoperation.
Acertainmarginalriskcannotbecom-pletelyeliminatedforvariousreasons.
Themainreasonsaretheweathercondi-tions,hiddenfaultsinship,tugandgearandnotatleasthumanerrors.
Suchmarginalriskisdifficulttomodelindetailanditisaccordingnecessarytomodelit"onaverage"byusingstatisticsofaccidentsthathaveoccurredinthepast.
Statisticsforoceanictowingaccidentshavenotbeenavailableandstatis-ticsfornormalshipoperationhavebeenused.
Thisisconsideredasagoodap-proximationasinbothcasesthemainriskcontributionistherateofoccurrenceofhumanerrors.
Theriskestimateisgiveninthenextsub-section.
MethodologyandbasisforriskassessmentThemethodologyandbasisfortheriskassessmentisdescribedbelow.
Theriskofoccurrenceoftowingaccidentsisdominatedbyhumanerrorsasisthecaseforshipaccidentsingeneral.
ThisisdocumentedbystatisticsfromU.
S.
CoastGuardshowninTable6-3.
Table6-3Humanerrorcontributiontovarioustypesofaccidents,refDr.
AnitaRothblum,HumanErrorandMarineSafety,U.
S.
CoastGuard,Re-searchandDevelopmentCenter,2003TypeofAccidentHumanErrorContributionTankeraccidents84-88%Towingvesselgroundings79%Collisions89-96%Allisions75%Fireandexplosions75%ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Asearchinpublishedpapers,(e.
g.
JournalofNavigation)andontheinternethasindicatedthatavailablestatisticalmodelsanddataforshipaccidentsdonotcovertowingaccidents.
Astowingaccidentmodelsarenotavailableandastowingaccidentsaredomi-natedbyhumanerrorsasshipaccidentsare,accidentmodelsanddataforshipaccidentsareusedtopredictthefrequencyofaccidentsundertowingofshipsfromEuropetoAsia.
Thegenericsimplifiedshipaccidentmodelusedisasfollows:accidentratepershipmilexshipmilesThissimplisticmodeldescribesthesituationingeneral.
Ithasbeendevelopedbydividingthenumberofaccidentswiththenumbermilessailedforcertainareaovercertainperiodsoftime.
ThegenericaccidentratesaregivenTable6-4.
Allthementionedtypesofacci-dentsareincludedintheriskestimategiveninTable6-5.
Table6-4GenericshipaccidentratesfordifferenttypesofaccidentsaccordingtoDNVReportNo2003-0331TypeofAccidentGenericaccidentratepership-mileCollision5.
0·10-7Grounding7.
2·10-7Fire/explosion1.
0·10-8Hulldamage1.
6·10-8Theaccidentrateforcollisions,forexample,meansthat5accidentsmaybeexpectedforevery10millionsailednauticalmiles.
Theinherentriskintowingofvesselsisingenerallargerthanifthevesselsareself-propelledbecausethecomplexityintowingisgreater,i.
e.
therearemorehazardsintowingthatinnormalsailing.
Theadditionalhazardsmaycomefromhandlingofthetowingarrangements,communicationbetweenthetugandthetowedvessel,moresevereweatherrestrictions,lowqualitytowingcompa-niesundercuttingthepriceetc.
Ariskincreasefactorisappliedheretoaccountfortheadditionalhazards.
Theriskincreasefactorhasbeenevaluatedbytwomethods:increasedinsurancepremiumfortowingofashipcomparedtowhenitisself-propelled;guidelineforshipcollisionwithbridgesbybothself-propelledshipsandshipsundertow.
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TheadditionalyearlyinsurancepremiumfortowingashipfromEuropetoIn-diaexpressestheinsurancecompany'sassessedextrariskcomparedtonormalself-propelledsailing.
Thisadditionalyearlypremiumhasbeenestimatedat8.
5%byamarineinsurancecompany.
Thisgivesanaverage60%increaseforthedurationoftowingthathasbeenestimatedat60days.
Ithasnotbeenpossi-bletodistinguishbetweenthetworoutes.
TheAmericanStateHighwayOrganisationhasdevelopedastandardandguidelineforassessmentoftheriskofvesselcollisionwithhighwaybridges.
(AASHTOLFRDStandard).
Inthestandard,thegenericprobabilityofmis-manoeuvreatbridgepassageisafactor2largerfortowedbargesthanforordi-naryships.
Thetwoestimatesareconsideredinagreementforthepresentpurposeandariskincreasefactorof1.
6,equaltoanincreasedriskof60%,isappliedontheaccidentprobabilitiestogivetheresultsinTable6-4.
Furthermore,theriskestimateisbasedonthefollowingdata:ThedistanceLondon-AlangthroughSuezisestimatedat6265nauticalmilesaccordingtoPortworld.
ThedistanceLondon-AlangaroundCapeisestimatedat10,810nauticalmilesaccordingtoPortworld.
Anaveragetowingspeedof5knotisused.
6.
5.
2ResultsTheresultsoftheriskassessmentaregiveninTable6-5.
Themainresultisthatoccurrenceofatotallossofthetowedvesselhasaprobabilityof0.
012%foravoyagethroughtheSuezCanaland0.
022%foravoyagearoundtheCapeofGoodHope.
Thiscanalsobeexpressedasonelossisexpectedin8,006towingvoyagesthroughtheSuezCanalandin4,640towingvoyagesaroundtheCapeofGoodHope.
Thedifferenceintheriskismainlyduetothedifferentlengthsofthetworoutes.
Table6-5RiskpertowingvoyageLondon,UK-Alang,IndiaLondon-AlangviaSuezCanalLondon-AlangviaCapeofGoodHopeProbabilityNumberProbabilityPercentRecurrenceNumberProbabilityNumberProbabilityPercentRecurrenceNumberFactor10000111000011Accident124.
91.
249%80215.
52.
155%46Totalloss1.
20.
012%80062.
20.
022%4640Fatalities8.
30.
083%120114.
40.
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Althoughnotthefavouredmodeofpropulsionthetowingofvesselsforscrapisnotuncommon.
TheLibertyshipsboughtbyAbleintheUSAweretowedtotheUnitedKingdomacrosstheAtlantic,andmorerecentlytheex-cruiselinerBlueLady(exNorway,exSSFrance)wastowedaroundtheCapein2005forbeachinginAlang,India.
6.
6Conclusiononpre-cleaningTheappropriatecleaningmeasuresaccordingtoEUwastelawsaredescribedabove.
Thismeansashipisproperlyemptiedifitdoesnotcontain:Materialfractionswithacontentofhazardousmaterialsabovetheconcen-trationmakingthematerialahazardouswaste.
Therelevantmaterialfrac-tionsarethesmallestfractionthatcanbetakenoutseparatelyofftheship.
Thesehavetobedecidedonacase-by-casebasis.
Thenecessarycleaningmeasureswillinmanycasesleavetheremainingshipstructureinashapewhichisunfitforsailingunderitsownpowerandwhichthenwillhavetobetowedtothefinalscrappinglocation.
Therisksoftowingpre-cleanedshipsfromEuropetoAsiahavebeenevaluated.
Theresultisthattowingaddstotheriskoftransportingtheshipbyuptoafactorofaroundtwo,comparedtothecasewheretheshipsailsthesamerouteunderitsownpower.
Someadditional/concludingrecommendationsregardingpre-cleaningmeasurescanbeadded:Mainmachinesandotherlargeinteriorstructureswillmostlikelybeunfeasibletoremoveaspartofthepre-cleaning.
Thisalsogoesforentiredecksorpartsofdecksorotherstructuresthatsupportotherlargerstructureswithinthevessel.
SpecialwastefractionssuchashalonsandrefrigerantsareregulatedbyCouncilRegulation2037/2000/ECanditisrecommendedtoremoveallrefrigerantsfromthecoolingsystems.
Additionally,fireextinguishersmayberemovedfromtheshipandtransferredtoaproperhazardouswastetreatmentfacility.
Itisrecommendedtoremoveallbatteries,eventhoughthealkalinebatteriesareofnoharm.
Variousstudieshaveshownthatnon-experiencepersonsarenotcapableofsortingthevarioustypesofbatteriesintohazardousandnon-hazardousbatteries.
AllWEEEsuchasnavigationequipment,fluorescenttubesandequipmentcon-tainingcathoderaytubesshouldberemovedasseparateandintactfractionsfromtheship.
IntheEU,Directive2002/96/ECsetsuprequirementsforthehandlingandtreatmentofthedifferenttypesofWEEE.
Itisnotrecommendedtoremoveanyotherheavymetalcontainingwasteasthesearealloyslocatedinswitchesandothersmallerunits.
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EventhoughPVCandneoprenearenon-hazardouswastes,theyhavebeenin-cludedinthelistasregulatedbytheBaselConvention.
Additionally,incinera-tionofplasticcontaininghighquantitiesofchlorinemayresultinlargequanti-tiesoffluegascleaningproducts.
Theuncontrolledcombustionofplasticwhichoftenoccursindevelopingcountriesshouldbepreventedasfaraspossi-ble,e.
g.
byremovingthewastepriortotowingtheshipfordismantling.
Afterremovalofthehazardoussubstances/waste,thewastemustbetransferredtoatreatmentfacilityforhazardouswasteapprovedbythenationalauthorities.
Partialpre-cleaningtoalevelwhereavesselcanstilltravelself-propelledisnotforeseenassuchinIMORegulations.
SOLAS(art.
4)doesallowforexemp-tionsforasinglejourney,whichthefinalvoyagetoascrapyardmustbesaidtobe,butitisnotlikelythatthisexemptioncanbeappliedgenerallytoallthevesselsdestinedforrecycling.
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7Costsofshipdismantlingandpre-cleaningofshipsThissectionpresentsananalysisofthecostsandbenefitsofshipdismantlingandpre-cleaningofships.
Theobjectivehasbeentoderivetheadditionalcostsofpre-cleaninganddismantlingofshipsapplyingsoundenvironmentalandsafetystandards,thusmakingitpossibletocomparetheenvironmentaladvan-tageswiththeshort-termeconomicdisadvantagesofpre-cleaningandshipdismantlingat"green"facilities.
7.
1IntroductionThepresentapproachestogreenrecyclingaremoreexpensivethantheconven-tionalbeachbreaking.
Theextracostofperforminggreenrecyclingisrelatedtoademandforinfrastructure(drainablesurfaces,cranesetc.
),andtoeachoftheextraprocessesinvolvedingreenrecycling,including:Constructioncostsfornewequipment,machineryandinfrastructure;Manpowercostsfornewandmoretimeconsumingworkroutines;Hazardouswastedisposalcosts.
Dismantlingofshipsistime-consumingandlabour-intensive.
Thetimeusedforperformingcleaningofvesselsbetween10,000and25,000LDTwasfoundtorangefrom4to7weeks(COWI/DGTREN,2004).
Thereforethecostoflabourplaysaveryimportantrolefortheoveralleconomicsofshipbreaking.
Shipownersgenerallyreceivepositivecashflowfromthedemolitionmarketwhensellingshipsfordemolition37.
Theshipownerwilltypicallyselltheshipfordemolitiontotheshipbreakingfacilityassociatedwiththehighestnetprofit.
Herethepriceofferedbytheshipbreakerismostimportant,buttransac-tioncostsmightalsoplayarole.
Thetotalpriceofthevesselofferedbyashipbreakerisdeterminedbyanumberofsitespecificfactorssuchassteelprices,investmentcosts,labourcosts,healthandsafetyrequirements,taxesandleviesetc.
37Thishashistoricallybeenthecasewhenapplyingtheconventionalpierbreakingorbeachingmethods.
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7.
2ApproachTheapproachforanalysingthecostsandbenefitsofshipdismantlingandpre-cleaningofshipsisdescribedbelow.
Thisincludesadescriptionofscenariosandeffectsincludedintheanalysis.
ScenariosTheanalysisofcostsandbenefitsiscarriedoutfromashipownerperspective(EUlocated)consideringthefollowingscenarios:1Referencescenario.
AbusinessasusualscenarioinwhichtheshipownerwillsellthevesselforscrappinginAsiawheretheconventionalbeachbreakingmethodwillbeapplied38.
2Pre-cleaningscenario.
Pre-cleaningofshipsinEUandCandidatecoun-triesandfinaldismantlingatbeachingsitesindevelopingcountries(Asia).
3Full"green"dismantlinginEUscenario.
Dismantlingofshipsata"green"facilityinEUcomplyingwithapplicableEUlawandthereforealsowiththedevelopedrecyclingguidelinesunderanewconvention.
4Full"green"dismantlinginOECDscenario.
Dismantlingofshipsata"green"facilityinanOECDcountry(representedbyTurkey)complyingfullywiththedevelopedrecyclingguidelinesunderanewconvention.
Pre-cleaningofvesselsdestinedforscrappingconsistsofremovalofthecon-taminantandhazardousmaterials.
Theobjectiveistoneutralisethevesselinsuchawaythatitsdismantlinginexistingcapability,ideally,wouldnotcreateenvironmentalproblems.
Thisrequiresthatthevesseltobestrippedofenvi-ronmentallyhazardousmaterialssuchasasbestos,fueloil,lead,PVC,PCBsandmore.
Apre-cleanedshipisahulk,a"dead"shipwithoutpowersystems.
Thevesselwillneedtobetransportedtothescrappingfacilityundertow.
Thecostsoftowingwillimposeanexpenseandwouldhavetobeaccountedforintheover-alleconomicanalyses.
Furthermore,towingisanoperationthatinvolvesanincreasedriskofaccidentsthatmayforexampleleadtolossofship.
ThescenariosanalysedareillustratedinthetablebelowandsplitintoEUandnon-EUaccordingtotheexistingconditionsforthereferencescenarioandtheapplicabilityoftheEUWasteShipmentRegulationforthefuturescenarios.
38Representsthesituationwheretheshipowner'sdecisiononwhenandwheretoscraparenotsubjecttoanyconstraints.
Theshipownerwillsimplychoosetoscrapattheshipbreak-ingyardofferingthehighestprice.
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Table7-1ScenariosanalysedPre-cleaningBreakingEUnon-EUEUnon-EUReferencescenario*√√Pre-cleaningscenario√√FullgreendismantlinginEUscenario√√FullgreendismantlinginOECDscenario√√*ConventionalbeachbreakingmethodThetableillustrateswherecleaningandbreakingtakesplaceinthevarioussce-narios.
Obviously,cleaningmaybeperformedasanactivityseparatedfromthebreakingorperformedinrelationandcoincidentwiththebreakingoftheship.
Thetableshowsthattherearethreealternativestothereferencescenariowhichhavebeenanalysed.
Theresultsofthesescenariosarecomparedwiththere-sultsofthereferencescenario.
Thecalculationofcostsandbenefitsisrestrictedtothesescenarios.
Onthisba-sistheconsequencesofothercleaninganddismantlingscenariosarediscussed.
Pre-cleaninglevelInchapter6,theoreticallythreedifferentlevelsofpre-cleaningcouldberelevant:1Totheextentwhichstilljustallowtheshiptosailbyitself(selfpropelled);2TotheextentwhichallowsexportofthevesselundertheexistingECWasteShipmentregulation,i.
e.
"properlyemptied";3Totheextentwheretheshipiscompletelyemptiedofhazardousmaterials.
Asearlierdescribed,level1wouldnotmeetWSRrequirementsandlevel3isnotapracticallyachievablelevel.
Inthissectiononeconomicsitislevel2ofpre-cleaningthatisconsideredinrelationtoanalysingthecostsandbenefitsofshipdismantling39.
Thetimeandresourcesneededtocleananddismantleashipdependsonthetypeofship.
Ideallytheanalysisshouldbecarriedouttoreflecttheconse-quencesforallthedifferenttypesofvessels.
However,itisnotpossibletocarryoutdetailedanalysisforalltypes.
Itispresumedthatatankerisagood39Distinguishingbetween2and3ismostlyanacademicexercisewhenshipsarenotex-emptedfromtheWSR.
Ifshipsareexemptedthevesselswillbeallowedtodestinationsbasedonequivalentlevelofcontrol,i.
e.
disposalfacilitiesmustcomplywithappropriate(EUorinternational)standards.
1,2and3cantheoreticallyalsobethesame.
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representativeforthedifferentshiptypes.
Thereforethecalculationofcostsandbenefitsiscarriedoutforamediumsizedtanker.
Costsdifferencesbetweendifferenttypesanddifferentsizesofshipsmustbeexpected.
Basedontheanalysesoftheconsequencesforatankeritisdiscussedhowtodismantleothertypesofvessels(i.
e.
passengerships,navalshipsetc.
)whichinfluencestheresultsofthedifferentscenariosrespectively.
EffectsTheaimhasbeentoestimatethecostsofdismantling(ornetprofitasavesseloftenrepresentsavaluefortheshipowner)perLDTforeachscenariothusmakingitpossibletoestimatetheadditionalcostsofsafeandenvironmentallysoundshiprecycling.
Thetablebelowliststheeffectswhichhavebeenestimatedinthedifferentsce-narios.
Table7-2Effectsincludedintheanalysisoftotalcost/benefitsforshipdisman-tlinginthescenariosReferencescenarioPre-cleaningscenarioFullgreendismantlingscenariosTransportcostsforlastvoyage*RiskofaccidentonthelastvoyagePre-cleaningcostsTowingcostsfrompre-cleaningtodismantlingsiteRiskofaccidentbytowingShipend-of-lifevalue**X:XXXXXXXXXXXNetrevenuefromrecycling*'Lastvoyage'meaningafteracargohasbeendeliveredinlastportofcalltothescrapping/pre-cleaningfacility.
**Theshipend-of-lifevalueisfortheshipinthecurrentstate,whichforexamplemeansthepre-cleanedshipinthepre-cleaningscenario.
Thevalueisexpectedtovaryconsiderablybetweenthedifferentscenariosfirstofallasaconsequenceofthedifferentrecyclingstandardsandtechniquesapplied.
Thetransportcostsarethecostsofsailinganemptyshiponitslastvoyagefromthepointofdeparturetothefinaldestination,i.
e.
thedismantlingorpre-cleaningsite.
Thecostfromriskofaccidentistheexpectedcostsoflosingaship(seesection6).
Itiscalculatedastheriskofaccidentmultipliedbytherevenuefromshipsale.
Thepre-cleaningcostshavebeenestimatedusingdifferentapproachesforde-rivingthecosts.
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stakeholdersaboutthecostsandactualprices,andonthepresentwork'scalcu-lationsofthepre-cleaningcostsbasedonobservedtransactions.
Interviewswithkeyindustryplayershavebeencarriedouttoestimatethecostsoftransportation(towing)ofthevesseltodevelopingcountries.
Thecostsofdismantlinghavealsobeenobtainedusingdifferentapproachestoderivethecosts.
Firstofall,atop-downapproachinwhichthepriceofdisman-tlinghasbeendirectlydeterminedfromcontractedtransactions(ordirectlybyinformationfromtheindustry)hasbeenapplied.
ThismeansthatthepricehasbeenbasedondatafromtheClarksondatabase.
ThepricesavailablefromClarksonmostlyreflectthepriceforscrappingofvesselsinAsiawheretheconventionalbeachbreakingmethodisapplied(thereferencescenario).
Unfortunately,itisnotpossibletoextractinformationaboutpricesforvesselsthathavebeenscrappedata"green"recyclingfacilityfromClarkson'sasthenumberoffacilitiesofferinggreenrecyclingislimitedinEuropeandglobally.
Untilrecently,themarketforsuchserviceshasbeenlim-itedtoafewgovernmentalprogrammesandconcernedcompanies,andacom-petitivemarketfortheseserviceshasyettoemerge.
Greenrecyclingofshipsis,generally,consideredmoreexpensivethantraditionalbreakingduetothecostsofmeasurestakenforthebenefitoftheenvironmentandworker'shealthandsafety.
ThefigurebelowshowsscrappricesperLDTforthelastthreeyearsforse-lectedAsiancountries.
050100150200250300350400450500200420052006$/LdtBangladeshIndiaPakistanNote:CalculationsbasedonClarksondatafor295ships,themajorityinBangladesh.
Figure7-1Scrappricesbycountry,year2004-2006Thefigureshowsthattherearesomevariationsinpricesbetweencountries.
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Thevariationsareduetoseveralfactorsincludingdifferencesinlabourcosts,localsteelprices,localtaxesandlocaldifferencesinpricesforsecondhandmaterials.
However,thetypeandthesizeofvesselsscrappedarealsoimpor-tant:Duetoafavourableratioofsteeltonon-reusableitemstankersgenerallyfetchhigherprices,whereasothervesselssuchaspassengerships,ferries,andcartransportersmaycommand100USDlesspertonnes.
Table7-3Averagescrappricesbytype,year2002-2006TypeAverageUSD/LDTNumberscrappedOiltanker399177Gas38615Othercargovessel35438Container3332Bulkcarrier32443Othertanker3003Passenger/ro-ro/vehicle26610Source:ClarksonInshipbreakingcountriesinAsia,costsassociatedwithhealth,safetyandenvi-ronmentalstandardsarerelativelylow,asthesearenotanissueatmostrecy-clingfacilities.
Hence,costsassociatedwithhealth,safetyandenvironmentalissuesplayonlyaminorrolecomparedtolabourcosts.
However,theyprobablystillexplainasmallpartofthecostdifferencebetweencountriesinAsia.
Fur-ther,thecostsaregenerallyrisingasstandardsaretightened(forexampleIndiarecentlyintroducedarulecallingforgas-freeworkingenvironmentforhotworkwhichhasreducedtheirmarketshare).
AsanalternativetoobtainingthepriceofrecyclingfromClarkson,thepricecouldbederivedfromabottomupfinancialanalysisofashipbreakingfacility.
However,afullanalysisisoutofscopeduetothecomplexnatureoftheindus-tryandisaproblematicapproachwhichhastorelyon(too)manyassumptions.
Interviewswithkeyindustryplayershavebeencarriedouttoestimatethecostsofdismantlingandpre-cleaningofshipsinEU.
Thishasbeensupplementedbydatafromthestudy"OilTankerPhaseOutandtheShipScrappingIndustry"(COWI/DGTREN2004)onthecostofgreenrecycling.
Finally,thelatestavailablepublicinformationaboutcostshasbeeninvestigatedthroughaninter-netsearch.
7.
3CaseanalysisThefinancialconsequenceshavebeenanalysedusingacaseanalysisapproach.
Asmentionedaboveatankerisagoodrepresentativeforthedifferentshiptypesandthereforethecalculationofcostsandbenefitshasbeencarriedoutforamedium-sizedtanker.
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7.
3.
1GeneralassumptionsTheanalysishasbeenbuiltuparoundanoiltankerwhichwasactuallyscrappedinAsiain2006.
Exactcharacteristicsofthetankerareprovidedinthetablebelow.
Table7-4CharacteristicsofthetankerselectedforcaseanalysisNameVentureIIITypeOiltankerDWT82,006LDT15,432DateofdemolitionMay2006CountryofdemolitionBangladeshPrice(USDperldt)380ThetableshowsthattheselectedshipisanoiltankerthatwasscrappedinBangladeshinMay2006forapriceof380USDperLDT.
Thefollowinggeneralassumptionshavefurtherbeenapplied:Breakingandpre-cleaningdestinationEU:UnitedKingdom,London;BreakingdestinationAsia:Bangladesh,Chittagong;BreakingdestinationOECD:Turkey,Izmir;TowingrouteUnitedKingdomtoBangladeshviaSuezCanalorroundCapofGoodHope(cheapestoption).
7.
3.
2Costsofdismantlingandpre-cleaningofshipsBelow,itisbrieflydescribedhowthecostelementsinthecaseanalyseshavebeenestimated.
Itshouldbenotedthatitisaquitedifficulttasktoestimatesomeofthecostelements.
Theestimatesandcalculationsareassociatedwithsubstantialuncer-taintyandasaconsequencethequantitativeanalysisismoreindicativethanprecise.
Itprovidestherightorderofmagnituderatherthantheexactlevel.
TransportcostsforlastvoyageandriskofaccidentonthelastvoyageConventionally,acommercialvesselwillcarrycargotoAsiatoaportclosetothebreakingbeach.
Ithasthereforebeenpragmaticallyassumedthatthedesti-nationforavessel'slastvoyagewithcargoissoclosetothefinalrecyclingdes-tination(orpre-cleaningdestination)thatthetransportcostsforthefinallegandthecostsfromriskofaccidentonthelastvoyageareignored(orestimatedbeingcloseto0).
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Pre-cleaningcostsItisdifficulttogeneralisethecostsofpre-cleaningasitdependsonanumberoffactorsspecificforeachvessel,suchasshipsize,type,cargotype,mainte-nancelevelandrepairsandrefitting.
Thereforeestimatesarehighlyuncertain.
Ingeneralthecostsofperformingpre-cleaningcomprise:manpowercostsforsaferemovingofthehazardouswaste,hazardouswastedisposalcosts,constructioncostsfornewequipment,machineryandinfrastructureneces-saryforsafeseparationandcontainmentofhazardousmaterialsfromtheship.
Inthestudy"OilTankerPhaseOutandtheShipScrappingIndustry"thatCOWIperformedforDGTREN,thecostofperformingpre-cleaningofashipanddisposalofhazardouswastewasestimatedbyindustrysourcestobearound25-50USD/LDTinAsia,buthigherinEuropeduetohigherlabourcosts.
Inthisstudywehavetriedtoinvestigatepricesofactualpre-cleaningofshipsinEU.
TheSandrienisachemicaltankerof8,380LDTbuiltin1974.
TheshipwasownedbyanItalianshippingcompanywhenitarrivedinAmsterdaminAugust2000.
ShortlyafteritsarrivalinAmsterdamharbour,theshipwasdetainedbytheportauthoritiesduetoitstechnicalstate.
Theshipin-spectorsdecidedthatthevesselwasonlyallowedtoleaveAmsterdamafterundergoingfundamentalrepairs.
Theinspectorsfurtherinformedtheenvi-ronmentalinspectorsonthesuspicionthattheshipcontainedhazardousmaterialsandcouldbeboundforscrapping.
InFebruary2001,theDutchEnvironmentalInspectoratearrestedtheSandrienastheshipcontainedhazardousmaterials,forinstanceasbestosandheavymetals,andtherewasacontractonscrappingtheshipinAsia.
SuchexporttoAsiawouldviolatetheEuropeanWasteShipmentRegulation.
AfterseveralcourtprocedurestheCouncilofStateintheNetherlandsinJune2002ruledthatanend-of-lifevesselnotproperlycleanedofhazardousmaterialsshouldbeclassifiedashazardouswaste.
ConsequentlySandrienwasdetainedintheNether-landsforcleaningandscrapping.
TheDutchMinistryofEnvironment(VROM)isakeystakeholderintheaffair.
AccordingtotheMinistry(Mr.
CeesLuttikhuizen)thecostofre-movingtheasbestosfromtheshipaccountedtoapprox.
700,000-800,000EURandafairestimateofthecostsofremovingotherchemicalsandwasteisapprox.
100,000EUR.
Hencethetotalcostof"pre-"cleaningofSandrienamountedtoapp.
800,000-900,000EUR.
Thisisequaltoapprox.
100EURperLDT.
Thereport"NationalGuidance:BestManagementPracticesforPreparingVesselsIntendedtoCreateArtificialReefs"byU.
S.
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tionAgency(2006)provideguidancerecommendingenvironmentalbestmanagementpracticestobeusedinthepreparationofvesselsforuseasar-tificialreefs.
Eventhoughthecleaningisnotdoneaccordingtothesamestandardsappliedtopre-cleaningforscrapping,theprocessiscomparable.
Thereportprovidesabasisforestimatingthecostsassociatedwiththepreparationofvesselsforuseasartificialreefsasitincludeestimatesfortwovessels:NameUSSSpiegelGroveUSSOriskanyTypeofVesselLandingShipDockClassAircraftCarrierOveralllength510feet911feetWeight7,000LDT32,000LDTTotalclean-upUSD625,000USD8,000,00040Shipclean-uptime7months12monthsForthesmallvesselUSSSpiegelGrovethecostperLDTaccountedtoapprox.
70EUR.
ForthelargercarrierOriskanythecostperLDTac-countedtoapprox.
190EUR.
Thepre-cleaningcostofHMSScylla:1.
2millionfor2,500displacementtonnes.
Atthepresentrateof1.
94USD/GBPthisisapprox.
2.
3millionUSDor930USD/LDT.
Itshouldbementionedthatthisfigurealsoin-cludesdemilitarisationcosts.
PacificNuclearTransportLimited(PNTL),asubsidiaryofBritishNuclearFuels(BNFL),exportedtwoofitsdecommissionednuclearfuelcarrierstotheNetherlandsforrecycling.
Theownerscouldhavenettedapproxi-matelyonemillionpoundspervesseliftheyhadbeenrecycledinIndiaduetothevalueofscrapsteelatthetime.
However,recyclingoftheves-selsintheNetherlandsresultedinacosttoPNTLofseveralhundredthou-sandpoundsper4000tonnevessel(UKDefra2006).
Thoughhighlyuncertain,thepriceofpre-cleaningoftheSandrienisassessedtobethebestproxyforthepriceforVentureIII.
Takingaccountalsoofthein-formationaboutcleaningoftheAmericanvesselsitisestimatedthatthepre-cleaningcostswillbeintherangeof75-150EURperLDT(100-200USDperLDT).
Towagecostsfortowagefrompre-cleaningtodismantlingsiteThetowagecostshavebeenestimatedbasedoninformationobtainedfromin-terviewswithkeystakeholdersinvolvedinthetowingbusiness.
40Thetotalclean-upcostisgivenasUSD15,630,000,butincludessignificantdemilitarisa-tion.
Thecostofpre-cleaningforhazardousmaterialsonUSSOriskanyisquotedasUSD8,000,000inAssembléeNationale(2006).
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TowingoftheshipOtapanfromAmsterdamtoTurkey.
TheDutchMinis-tryofEnvironment(VROM)wasinvolvedintheplanning,whichwasun-dertakenbyLandfall.
Thetotalpricewas205,000EUR,whichreflectedthatLandfallwouldreturnwithanothership.
However,OtapanhadtobereturnedtoAmsterdamasthedealwiththeTurkishscrappingcompanywascancelled.
Thecostofthereturn-towwas350,000EURandtheopera-tiontook30days.
Onthisbasisapriceoftowingapre-cleanedshipcanbeestimatedtoapp.
8,000-10,000EURperday.
ThisestimatewasconfirmedbyJoepCaesmaatfromLandfall.
ThepriceoftowingaroundCapeofGoodHopeiscalculatedusinganesti-matedcostof10,000EURperdayandestimated85days(travelspeedof5knotsandadistanceof10,800nauticalmiles);sothetotalcostsoftowingofVentureIIIfromLondontoBangladeshwouldhavebeen850,000EURor55EURperLDT(65USDperLDT).
ThecostsofpassingthroughtheSuezCanalcanbeobtainedfromLethAgen-cies(http://www.
lethsuez.
com/tariff_07.
htm).
FromtheirhomepagethetotaltollforSuezCanaltransitcanbecalculatedforaspecificship(http://www.
lethagencies.
com/calculator.
aspPort=SUEZTREG).
ThetollforVentureIIIhasbeencalculatedtoapprox.
295,000USD.
Againusinganestimatedcostof10,000EURperdayandadurationof55days,thecostsoftowingofVentureIIIfromLondontoBangladeshisesti-matedto550,000EUR.
ThetotalpriceincludingSuezCanaltollisthus845,000or55EURperLDT(65USDperLDT).
ThisconfirmsthecommonunderstandingintheindustrythatthepriceissetsothatitismarginallycheaperpassingthroughtheSuezCanalthangoingaroundCapeofGoodHope.
RiskofaccidentbytowingTheriskofaccidentbytowingwasaddressedinsection6.
Hereitwasesti-matedthattheriskofaccidentbytowingisonlyslightlyhigherthantheriskfornormaloverseasnavigation.
TheriskoflosingashipthatisbeingtowedfromLondontoBangladeshwascalculatedtoapprox.
0.
02%.
ForVentureIIIthisisequaltoexpectedcostsof120,000EURintotalorapprox.
10EURperLDT(15USDperLDT).
Revenue/costsofashipsoldforrecycling(end-of-lifevalue)Theeconomicsoftheshiprecyclingindustryandtheforcesbehinddemandandsupplyontheshiprecyclingmarketareinterrelatedwiththreeothermarketsthatshipownersoperateon:thenewbuildingmarket,thesecond-handmarketandthefreightmarket.
Tosomeextenttheshiprecyclingmarketservesasabufferbalancingdemandandsupplyinthefreightmarketwithincreasescrap-pingwhentheglobaldemandforseatransportmoderates.
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Freightratesarebyfarthemostimportantdriverfortheshipowner'sdecisiononwhentoscrapavessel(COWI/DGTREN,2004).
Withboomingrates,no-bodyrecyclesshipsunlessforcedtodosoforregulatoryortechnicalreasons.
Hence,thehighfreightratesfrom2003-2006canexplainthelimitedrecyclingvolumesinthesameperiod(seeFigure3-11).
ThiswasalsodemonstratedinarecentarticleintheBIMCOBulletin(2006).
Ifthepriceobtainableinthedemolitionmarketisasignificantdriverforthedecisionoftheshipownersonwhentoscrap,thereshouldbeacloseandposi-tivecorrelationbetweenpricesandvolumesofdecommissioning.
However,pricesandvolumesareactuallynegativelycorrelated,i.
e.
whenvolumesgodown,pricesincrease(seefigurebelow).
Thisindicatesthatotherfactors(e.
g.
thedevelopmentsinthefreightmarket)aremoreimportantfortheshipowner'sdecision.
0501001502002503003504004501994199519961997199819992000200120022003200420052006YearofscrapAverageUSD/LDT01234567Volume(MillionLDT)Volumeofscrapping(alltypes)AveragepriceperLDT(alltypes)Source:OwncalculationsbasedonClarksondataFigure7-2Averagescrappriceandvolumesofscrapbyyearofscrapping(alltypes)Themaindriverfortheshipowner'sdecisionwheretoscrapisthepriceofferedbytheshipbreakers.
Withthecurrentpracticeused,shipbreakingisaverylabour-intensiveindus-try.
Labourcoststhereforeplayapredominantroleindeterminingwhereshipsarescrappedandhavebeenscrappedhistorically.
ThisisreflectedinFigureB-1inAppendixB,whichshowsthattheIndianSub-Continent(India,Bangla-desh,Pakistan)andChinaaccountforalmost90%oftheshipbreaking.
ThisfindingisgenerallyinlinewiththefindingsoftheCOWI/TRENstudy.
Therehavebeenconsiderablevariationsinthemarketsharesofthemajorshipbreakingnationsovertheyears.
ThefigurebelowshowsthatBangladeshtodayFreightratesShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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accountsforthelargestshare,whileonly5yearsbackintimeIndiawastheworld'slargestshipbreakingnation.
0%10%20%30%40%50%60%1994199519961997199819992000200120022003200420052006BangladeshIndiaPakistanChinaFigure7-3Marketshareofmainshipbreakingnations,1994-2006Steelfromshipscompriseslessthan2%ofthetotalconsumptionofrecycledsteelworldwide(BIMCO,2002)andthereforethelevelofshipscrappingac-tivityplaysanegligibleroleindeterminingthepriceofrecycledships.
Infactitistheotherwayround.
Onceashipownerhasdecidedtoscrapavessel,thepriceofferedbytheshiprecyclerisheavilyinfluencedbythepriceofsecond-handmaterials,inparticularthepriceforreusablesteel.
Whenthedemandforsteelandotherreusableitemsgrows,steelpricesincreaseandtheshipscrap-pers'earningpotentialalsoincreases.
Asaconsequencetheshipscrapper'swill-ingnesstopayforavesselfordecommissioninggrows(andviceversaforaweakeninginthedemandforsteelandotherreusableitems).
Shipbreakingisalabour-intensiveindustryandthereforelabourcostsplayapredominantroleindeterminingwhereashipisscrapped.
Labourratesare20-100timeshigherinEuropecomparedtoIndia/Bangladesh(http://laborsta.
ilo.
org/).
Thisisbyfarthemainreasonwhybreakinghistori-callyhasmovedtoAsiancountriesandwhyEuropeancountriesarenotoperat-inginthemarkettoday.
VariationsThisnatureoftherecyclingmarketmeansthatthepriceofshipsforrecyclingvariesconsiderablyovertime.
Belowscrappingpriceshavebeenestimatedasanindicationoftheglobalsteelmarketsituationatthetimewhentheoiltankerwassold.
However,itshouldalsobenotedthattheshipscrappersareoperatinginaglobalmarket,whichisconfirmedbythefactthatthepricetrendinthescrap-pingcountriesofAsiaisremarkablysimilarwithonlyminordifferencesbe-tweencountries.
ThisisinparticularconfirmedbythefigurebelowshowingPriceofrecycledsteelLabourcostsShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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theaveragescrappricesovertimeforselectedcountries(reproducedfromCOWI/DGTREN,2004).
0501001502002503003504004505001994199519961997199819992000200120022003200420052006Average$/LdtBangladeshIndiaPakistanTotalSource:OwncalculationsbasedonClarksonFigure7-4Scrapprice-Selectedcountries(toallowcomparisononlyoiltankersareincluded)Asearliernotedthepriceofrecycledsteelisthemostimportantfactordeter-miningthepriceofferedforashipforrecycling.
Thispotentiallymeansthatthehighestpricecouldbeofferedbyscrapperslocatedinareaswherethepriceofsteelishighest.
However,thisholdstrueonlytoalimitedextentassteelisaninternationallytradedcommoditythatcanberelativelyeasilytransportedfromascrappinglocationtoadestinationwhereitisneeded.
Infact,itisacommonmisconceptionthatscrappingtakesplaceinAsiancoun-tries(India,Pakistan,BangladeshandChina)onlyduetothefactthatthesecountrieshaveeitheraboomingeconomywithahighconstructionactivityorveryfewdomesticmetalresourcesandconsequentlyahighdemandfor(recy-cled)steel.
ThecostoftransportingsteelfromEuropetoAsiaisintherangeof10-15USDpertonne,whilethecostofatransportfromIndiatoChinaisintherangeof3-5USDpertonne41.
Thesefiguresshouldbecomparedtopricesofsteelintherangeof400-650USDpertonnedependingontype(2006-prices,source:http://www.
meps.
co.
uk/world-price.
htm).
Thisprovesthatlocalvariationsinsteelpricesonlyplayasmallroleindeter-miningwhereashipisrecycled.
Indeedotherfactorsaremuchmoreimportant,41BasedonanaveragerateperdayforaPanamaxBulkCarrierDWT75,000of30,000USD(source:Clarkson)andassumingatraveltimeof20-40daysEurope-Asiaand7-15daysIndia-China.
Steel-aninterna-tionallytradedcom-modityShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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primarilylocallabourcosts-asrecycling(usingtheconventionalbeachingmethod)isalabour-intensiveindustry-andsecondlyenvironmental,healthandsafetyregulations.
Themaindriversinthescrappingindustrycansimplisticallybedescribedasfollows:Freightratesdeterminewhentoscrap.
Labourcostsdeterminewheretoscrap.
Steelpricesdeterminethesizeoftheshipowner'sprofit.
Thepriceofashipthathasbeensoldfordemolitionusingtheconventionalbeachingmethodcan(mostoften)bedirectlyobtainedfromClarksonformostvessels.
Hence,itisreportedthatVentureIIIwassoldforscrapforapriceof380USDperLDT,whichequalsapprox.
5.
9mill.
USD.
ThisreflectsthepriceforscrappinginBangladeshMay2006.
ThispricelevelisconfirmedbypricesreportedbyGMSinMay2006forscrappinginBangladesh,IndiaandPakistan42,butinsomecasespricesupto500USD/LDThavebeenpaid.
Greenrecycling,EUOnlyafewrecyclingfacilitiesexisttodayintheEU.
Theyareabletoperform"greenrecycling"ofships,butthecapacityislimitedandtheydonotdismantlethelarge-sizeships,suchasVLCCorULCC.
Hence,onlyfewshipshavebeenscrappedata"green"recyclingfacilityintheEU.
Asaconsequence,pricespaidforshipsscrappedatagreenrecyclingfacilitycannotyetbeobservedinthemarket.
Europeanshiprecyclingcompanieshavebeencontactedandinquiredaboutthecostsofgreenrecycling.
However,withfewexceptionstheindustryisreluctanttoprovideinformationaboutthepricethattheyarewillingtopayforaspecificshiporaboutcostsinvolvedintherecyclingprocess.
VanHeyghenRecyclinginBelgiumisoneofthelargestactiverecyclingcom-paniesinEurope.
VanHeyghenRecyclingclaimedthatthecompanywouldbewillingtopayapprox.
100EURperLDTexcluding,however,thecostsofcleaningtheshipofhazardouswaste.
Inparticularthemanageremphasizedthatthecostofremovingasbestosoftenprovesimportant.
The100EURperLDT(130USDperLDT)expressesthenetvalueofthere-cyclablesteelwithoutlabourandcapitalcostsofdismantlingtheship.
EvenwhentheprocessofrecyclingisundertakeninEUwithahigherdegreeofautomationanduseofmachineryitisstillalabour-intensiveprocess.
Thisisthemainreasonwhythevalueofanend-of-lifeshipismuchlowerforaEuro-peanshiprecyclingcompanythanforanAsiancompany.
HKSMetal'sfacilityinGravendeel(slipwayandpierbreaking)mostlyscrapsinland-watervessels,andcandismantlevesselsupto4,000LDT.
Theyreportthattheybuyvesselsat140-150EUR/LDT(180-200USDperLDT).
Thisisapprox.
70-80EURlessthanthesteelsmeltersbuyingpricetocoverthecosts(andprofits)ofdismantlingthevessel.
Inthepricethecleaningcostsforoil,42GMSweekly,May26,2006,Volume49-http://www.
gmsinc.
net/gms/SummingupmaindriversConventionalbeach-ingShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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fluidsandasbestosarenotincluded.
Thesecostsareusuallycoveredbythesellerofthevessel.
Hence,HKSMetal'sfacilityseemstobeabletopayahighernetpricethanVanHeyghenRecycling.
Thecleaningcostsinrelationtoafullgreenrecyclingarelikelytobethesameorlessthanthoseoccurringwhenashipispre-cleanedbecausethecleaningprocessiseasierasitcanbedoneinanintegratedprocesswiththedismantlingoftheship.
Usingthepre-cleaningcostscalculatedabove,thecleaningcostsinrelationtofullgreendismantlingareestimatedat50-150USDperLDT.
Thesecostswillheavilydependonthequantitiesofasbestos,leadandotherhazard-ouswaste.
Hence,usingtheseestimatesthenetpricethataEuropeanrecyclingfacilityshouldbepreparedtopayforavesselrangesbetween20and130USDperLDT.
GMS43isoneofthelargestcashbuyersofvesselsforrecyclingintheworld.
AccordingtoGMS,facilitiesinIndia,BangladeshandPakistanofferedpricesfortankersaround360-380USDperLDTinMay2006,whereasTurkeywaspayingintheregionof225USDperLDTfortankersatthesametimeandthiswascomparabletothepricesinChina.
Thepricevariationreflectsthedifferenceinmethodappliedandnotleastthedifferenceinlabourrates.
7.
3.
3CaseanalysisresultsThetablebelowsummarisestheestimatedeffectsinthefourscenarios.
Theeffectswerediscussedandestimatedinthesectionaboveandapplytotherep-resentativecaseofamedium-sizedtanker.
Againitshouldbenotedthatesti-matesandcalculationsareassociatedwithsubstantialuncertainty.
Asaconse-quence,thequantitativeanalysisprovidestherightorderofmagnitudeasthedifferenceinthenetprofitforshipownersinthefourscenarios.
Table7-5EstimatedcostsofeffectsofshipdismantlinginthefourscenariosUSDperLDTReferencescenarioPre-cleaningscenarioFullgreendis-mantling,EUFullgreendis-mantling,TurkeyPre-cleaningcostsTowingcostsfrompre-cleaningtodismantlingsiteRiskofaccidentbytowingShipend-of-lifevalue000380-200--100-65-15380000-20-130000225Netrevenuefromrecycling380100-200-20-130225Differencetoreferencescenario-180-280250-40015543Seehttp://www.
gmsinc.
net/gms/profile.
phpGreenrecycling,TurkeyShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Thetableshowsthatthereferencescenarioresultsinexpectedrevenueof380USDperLDTwhichisequaltothepricepaidbythecashbuyerondeliveryforbeachingandbreakinginAsia.
TheTurkishscrappingindustryisalsoinapositiontopayforthevesselsandcurrentlyacquirevesselsfordemolitioninthefreemarket.
Consequently,inthescenarioswithfullgreendismantlinginTurkeytheshipowner'sexpectedreve-nueequalsthepricepaidof225USDperLDT.
Thenetdifferencetotherefer-encescenarioisapprox.
150USDperLDT.
Theshipend-of-lifevalueforaEuropeandemolitioncompanyhasbeenpru-dentlyestimatedto20to130USDperLDT44.
ThecostdifferencetoTurkeyisprimarilyduetohigherwagesinEUcountriescomparedtoTurkey.
Theindus-tryinTurkeythusenjoysanunrivalledadvantageoveranyexistingalternativeEuropeansite.
TheminimumwageinTurkeyisafractionofthewageinmanyEUcountries,butcomparabletotheminimumwagesinsomeoftherecentEasternEuropeanmemberstotheEU45.
Thenetdifferencetothereferencescenarioisapprox.
250-400USDperLDT.
Thecalculatedrelativecostdifferencebetweenreferencescenarioandthefullgreendismantlingscenarioisassociatedwithuncertaintyasnoshipsareactu-allyscrappedinEuropetoallowdirectcomparisonofpricespaid.
However,therelativecostdifferencehasbeencheckedusinganalternativeroughapproach.
InarecentreportbytheFrenchSecrétariatGénéraldelaMer46theproductivityintermsofsteelcuthasbeenestimatedforAsianandEuropeanscrappers.
ItisestimatedthattheproductivityinEuropeisapproximately10timeshighercomparedtotheAsianscrappingfacilities,i.
e.
steelcutperworkerperyearis300to1200tonnes,whileinAsiaitis30to80tonnesperworkerperyear(An-nexeXVI,p.
143).
TakingaccountofthemuchhigherlabourcostsinEurope,i.
e.
approx.
50timeshigher,theproductioncostsnottakingaccountofcapitalcostsareroughly5timeshigherinEuropecomparedtoAsia.
Aroughestimateofproductioncostscouldbeintheorderof50USDperLDT(steelpriceof500pertonne,pricepaidperLDTof400USDandprofitof50USD).
Usingthecalculatedproductivityfactorof5,theproductioncostsinEuropecanbeesti-matedat250USDperLDT.
Addingcapitalcosts47andtakingaccountofslightlylowerpricesforreusablesteelinEurope,acostsdifferenceof250to400USDperLDTseemsplausible.
44Pricesvarydependingonvesseltypeandconditionsofindividualvessel.
45TheminimumwageinTurkeyisapprox,300EURpermonth,whichasanexampleisapp.
halfoftheminimumwageinSpainorGreece(http://www.
fedee.
com/minwage.
html).
MinimumwagetheUSisapprox.
480EURpermonth.
46LerapportdelaMissionInterministérielleportantsurleDémantèlementdesNavirescivilsetmilitairesenfindevie-http://www.
sgmer.
gouv.
fr/article.
php3id_article=5247Estimatedto30to100EURperLDTintheFrenchreport,whichequals40-130USDperLDT(AnnexeXVI,p.
140).
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ThepricedisadvantageforboththeTurkeyandtheEUfullgreendismantlingscenarioiscounterbalancedbyotherfactorsthatareinfavourofthesecountriesintermsoflabour,safetyandindeedenvironmentalconditions.
Finally,thepre-cleaningscenariohasbeenestimatedtoresultinexpectedreve-nueof100-200USDperLDTfortheshipowner.
Theestimateisassociatedwithuncertaintyasespeciallythecostsofpre-cleaninghavebeendifficulttoestimateandheavilydependofthespecificcharacteristicsofthevessel,i.
e.
theconfigurationofthematerialsonboardavessel.
Thenetdifferencetotherefer-encescenarioisapp.
180-280USDperLDT.
Thecalculatedcostdifferenceofthevariousscenariosrelativetothereferencescenarioindicatesthe'incentivegap'fortheindustrytochoosetheseoptionsoverthetraditionalbeachinginAsia.
Thecalculatedcostdifferencethusessen-tiallyexpressesthesizeofasubsidyneededinorderforashipownertofinditattractivetouseaEuropeanfacilityoveranAsianfacility.
Thecostdifferencerelativetothereferencescenarioforallalternativescenar-iosissubstantial,whichpointstothefactthattheoptionsaredependentonsub-stantialgovernmentsubsidiesandpublicfundsorotherregulatorymeasures.
7.
4Generalisationandsum-upThesectionabovediscussedandestimatedtheeffectsforthecaseofamedium-sizedtanker.
Costswilldifferforothertypesanddifferentsizesofships.
Generallythecostdifferencemustbeexpectedtoincrease(inrelativeterms)withthesizeofshipsastheman-hoursneededtodismantletheshipincreasewiththesize.
Sincelabourcostisthemostimportantcostdriverofdismantlingvessels,thismeansthattheadvantageoflow-costcountriesoverhigh-costcountriesincreasesinrelationtothesizeoftheship.
Forsmallships(300,000*P&ONedlloyd(nowMaersk)partnerISO14001andOHSAS18001PierbreakingChinaJiangmenZhongxinShipbreakingSteel&Ironcompanyltd,JiangMenCity,GuangdongProvince300,000ISO14001OHSAS18001PierbreakingChinaJiangMenXinhuiShuangshuiShipbreaking&Steel.
Co.
Ltd60,000ISO14001OHSAS18001PierbreakingChinaXinRongRecycling&LogisticsCo.
Ltd(formerlyJiangsuChan-grongSteelCo.
)>100,000ISO14001OHSAS18001PieranddockbreakingChinaGuangzhouPanyuShipBreaking&SteelRollingCo**40,000ISO14001OHSAS18001Pierbreaking*Accordingtotheyardunderexpansionto1,000,000LDT/year**Basedonwww.
nmri.
go.
jp/lca/lca_hp/pdf/36.
pdfandBIMCO(2007)IndianfacilitieshavegonethroughacertificationexercisesteeredbytheGuja-ratMaritimeBoardresultinginthecertificationof22facilitiesaccordingtopressreports.
Alistof32facilitiesinAlangcertifiedforISO18801andOHSAS18001hasbeenobtainedfromacashbuyer53.
Mostyardswerecertifi-53ListfromGMSofcertifiedshipyardsinAlangin2006ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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cationbyInternationalCertificationServices(Asia)Pvt.
Ltd.
,andsomethroughtheclassificationsocietyRINA.
FouryardsPriyaBlueIndustries,R.
K.
Industries(unit2),BaijnathMelaramShipBreakers,andShreeRamVesselScrappresentthecertificationsontheircompanyhomepagesontheinternet.
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AppendixD:ExtendedlistofhazardousmaterialsShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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Thedifferenttypesofhazardouswastetobeidentifiedatships,classificationofpropertiesandtheirconcentrationlimits.
SubstanceClassificationofhazardousproper-tiesaccordingtoEUHazardousWasteClassificationDescriptionofconcentrationlimitsforhazardouswasteBaselConventionHazardClass,AnnexIIIBaselConvention,AnnexVIIIHalonsDependsonthetypeofhalons:Carbontetrachloride:T,Carc3Methylchlroide:FxYesifconc.
>3%H2Propane(C3H8)Butane(C4H10)Fx-flashpoint=-104°CFx-flashpoint0.
1%YesH3A3020,A4060AlcoholsFlashpoint1%H3DieselOilCarc.
3Yesofconc.
>1%H3GasOilCarc.
3Yesofconc.
>1%H3BiocidesandphytopharmaceuticalsincludingpesticidesandherbicidesToxic,butdependsonthespecificpes-ticideVerytoxic:0.
1%Toxic(R23,R24ORr25):3%orToixcR48andR39)1%H6.
1A4030ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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SubstanceClassificationofhazardousproper-tiesaccordingtoEUHazardousWasteClassificationDescriptionofconcentrationlimitsforhazardouswasteBaselConventionHazardClass,AnnexIIIBaselConvention,AnnexVIIIPharmaceuticalproductsToxic,butdependsonthespecificpharmaceuticalVerytoxic:0.
1%Toxic(R23,R24ORr25):3%orToixc(R48andR39)1%H6.
1A4010RadioactivematerialsRadioactiveDependentonthetypeofradioac-tivematerialH7WasteleadacidbatteriesC(R35)Yesifcon.
>1%H8A1160AsbestosCarc1Yesifcon.
>0.
1%H11A2050ΗexavalentchromiumcompoundsDependentonthecompoundH11A1040PCBandPCTcontainingsub-stancesDangeroustotheenvironmentYes,ifcon.
>50mg/kgH11A3180AntimonyDependentontheantimonycompoundH11A1010,A1020BerylliumCarc2Yesifcon.
>0.
1%H11A1010Cadmium,cadmiumcompoundsDependentonthecadmiumcom-pounds,butmainlyCarc2Yesmainlyifcon.
>0.
1%H11A1010,A1020,A1080Lead,leadcompoundsDependentontheleadcompounds,butmainlyRep1Yes,mainlyifconc.
>0.
5%H11A1010,A1020,A1080,A1160,A2010ZincresiduescontainingleadandcadmiuminconcentrationsthatrenderthemhazardousDependsonthezinccompoundConcentrationlimitsvarieswidelyH11A1020,A1080Mercury,mercurycompoundsDependentonthemercurycompound,butmainlyTorTxT:ifconc.
>3%Tx:ifconc.
>0.
1%H11,H12A1010,A1030Tinbasedanti-foulingcoatingsToxicanddangeroustotheenviron-mentT:ifconc.
>3%H12A4030LubricatingoilsDependentonthetypeofoilbutmainlyCarc2Yesifcon.
>0.
1%H12A3020,A4060HydraulicOilsDependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12A3020,A4060ShipDismantlingandPre-cleaningofShipsC:\DocumentsandSettings\junnean\LocalSettings\TemporaryInternetFiles\COWIDHIEUshipdismantlingfinal280607.
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SubstanceClassificationofhazardousproper-tiesaccordingtoEUHazardousWasteClassificationDescriptionofconcentrationlimitsforhazardouswasteBaselConventionHazardClass,AnnexIIIBaselConvention,AnnexVIIIOilresidues(sludge)DependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12OilwatermixturesDependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12WasteoilsDependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12OilcontaminatedragsDependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12LubricatingoilsDependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12HydraulicOilsDependentonthetypeofoilbutmaybedangeroustotheenvironmentNoconcentrationlimitsH12UnsortedwastebatteriesDependentonthetypeofbatteriesH12A1170Glasswastefromcathode-raytubesandotheractivatedglassesRegulatedasWEEE(WasteofElectricandElectronicEquipment)H13A2010PolyvinylChlorideNoneNothazardouswasteH13NeopreneNoneNothazardouswasteH13OtherPlasticsNoneNothazardouswasteH13