Wärtsilä Completes Acquisition of L-3 MSI

By MarEx 2015-05-29 16:45:46

Wärtsilä Corporation announces that its acquisition of the Germany based L-3 Marine Systems International (MSI) has been finalized and control of the company will be transferred to Wärtsilä with effect from June 1, 2015.

In December 2014, Wärtsilä announced that agreement had been reached to acquire MSI from NYSE-listed L-3 Communications Holdings using financing from existing cash resources and credit facilities. The acquisition received Korean merger control clearance in March and E.U. clearance in April.

Electrical and Automation (E&A) systems are of increasing importance since the operation of ships is becoming ever more sophisticated. Wärtsilä’s strong position in the development of technologies that enhance operational efficiency will be further strengthened with the addition of MSI’s broad range of capabilities. The company’s portfolio comprises several well-known product brands, including SAM Electronics, Valmarine, Lyngsø Marine, Dynamic Positioning & Control Systems, Jovyatlas Euroatlas, ELAC Nautik, FUNA, GA International and APSS.

MSI has extensive experience in supplying automation, navigation and electrical systems, dynamic positioning technology as well as sonar and underwater communications technology for a variety of vessel types and offshore installations. The MSI organization, which currently comprises more than 1700 employees working from 38 locations in 14 countries, will be integrated with Wärtsiläs existing E&A business.

The acquisition will notably enhance Wärtsilä’s E&A offering and market position. In 2014 MSI reported an operating profit of seven percent. Wärtsilä foresees that the new unit will be able to capture new market opportunities and improve operational efficiency for its customers, thereby increasing both the sales and profitability of the business.

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Danish Flag Sets Tonnage Record

By MarEx 2015-05-29 17:12:07

Danish shipping companies have strengthened the merchant fleet under the Danish flag, setting a new record in dead weight tons. In January 2014 the gross tonnage was 12.3 million gross tons, whilst in April 2015 it was 14.6 million gross tons or 16.6 million dead weight tons.

“The gross tonnage is no guarantee of greater earnings and more Danish jobs in the shipping companies, but it is a good basis for influence and development opportunities, and it means Denmark is still one of the world’s biggest flag states. It means something when we want the rest of the world to follow Denmark’s high standards, and it means something in these times of electioneering when we are talking to Danish politicians about the importance of shipping to the Danish economy and growth,” says Anne H. Steffensen, Director-General of the Danish Shipowners’ Association.

The total Danish-controlled fleet comprises about 1,800 ships, of which just over a third, 658 ships, are under the Danish flag. In 2014 the Danish shipping companies set a record for the third time, contributing DKK 204.5 billion ($30 million) to the balance of payments. Shipping thus constitutes approximately 20 percent of total Danish exports. Over a third of exports go to growth markets outside the E.U.

“It’s particularly good news considering the difficult market conditions the shipping companies have encountered in recent years,” says Anne H. Steffensen, Director-General of the Danish Shipowners’ Association.

The figures for Danish shipping were published in conjunction with the annual general meeting of the Danish Shipowners’ Association on May 28, 2015. The figures also show that shipping companies and the maritime sector provide employment for 107,886 people.

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Kulluk: Shell Approved Inadequate Plan

By MarEx 2015-05-29 16:50:51

The U.S. National Transportation Safety Board (NTSB) as released its report into the 2012 grounding of Kulluk, an ice-class mobile offshore drilling unit owned by Shell Offshore and operated by Noble Drilling.

The rig grounded in heavy weather near Ocean Bay on the eastern coast of Sitkalidak Island off Kodiak Island, Alaska, about 2040 local time on December 31, 2012.

The Kulluk, under tow by the ice-class anchor-handling tow supply vessel Aiviq, departed Captains Bay near Unalaska, Alaska, 10 days earlier for the Seattle, Washington, area for maintenance and repairs. Four crewmembers on the Aiviq sustained minor injuries as a result of the accident.

The investigators concluded that no single error or mechanical failure led to this accident. Rather, shortcomings in the design of a plan with an insufficient margin of safety allowed this accident to take place. The plan was created to move the mobile offshore drilling unit (MODU) at a time of year with a known likelihood of severe weather conditions for reasons unrelated to operational safety.

Shell had retained warranty surveys on all five previous tows of the Kulluk. No regulatory requirement existed for a warranty surveyor to review and approve, or suggest modifications to, the tow plan and its components. The surveyor that Shell retained for the accident voyage approved the tow plan in its entirety. This was the only external review of the tow plan and the equipment that was to be used in the planned tow.

The Coast Guard was not required to oversee the tow. Rather, the Coast Guard’s role, a critical one given the circumstances, was limited to its response to this accident―delivering the needed engine components to the Aiviq, unsuccessfully attempting to tow the Kulluk, and, most important, rescuing Kulluk personnel when their lives were endangered, an operation that itself risked the lives of the Coast Guard rescuers.

Many maritime regulators in countries with operations in environments with the potential for severe weather actively oversee tow operations. For example, Norway addresses many of the shortcomings in the oversight of tow gear and severe weather avoidance that were evident in this accident.

Canada similarly addresses safe towing operations, including specifying parameters for tow gear strength, by recommending that operators adhere to IMO towing guidelines.

IMO and the Norwegian Maritime Authority provide guidance for oceangoing tows with margins of safety for encounters with adverse weather.

The Aiviq lost engine power at a critical point in the Kulluk’s tow. Coast Guard investigators believe that the design of the fuel oil storage tanks’ common vent and overflow system was flawed and that these flaws led to the seawater contamination of the fuel tanks during the Aiviq’s transit during rough sea conditions.

Offshore Service Vessels contends that fuel contaminants were present in the fuel taken on by the Aiviq in Dutch Harbor and that this contamination, rather than seawater that entered the system later, led to the engine power loss. Regardless, the source of the fuel contamination was outside the scope of the NTSB’s investigation of this accident and, therefore, was not determined.

The report states: given the risks associated with this transit, including the likelihood of the tow encountering severe weather, Shell and its contractors, particularly Offshore Service Vessels, the operator of the Aiviq, who reviewed and approved the tow plan should have either mitigated those risks or departed at a time of year when severe weather was less likely.

For example, Shell and its contractors could have included additional tow vessels to the entire transit to reduce the likelihood of catastrophic results from a failure of the Aiviq or its tow gear. Redundancy is a necessary element of safety-critical transportation systems, and given the hazards of operations in Alaskan waters, those involved in the tow plan should have recognized and addressed the lack of redundancy.

The series of failures that led to this accident began when Shell failed to fully address the risks associated with a late December tow in Alaskan waters, and ended with the grounding of the Kulluk, states the report. Although multiple parties were involved in the review and approval of the tow plan, the ultimate decision to approve and implement the tow was Shell’s.

The dynamics of a single entity approving a go/no-go decision in the face of risks, with multiple parties involved, have been addressed in studies of previous catastrophic events.

This research demonstrates that, even with formal review processes involving multiple entities, the ability of parties involved in a decision to articulate and draw attention to risks is limited when a single entity bears ultimate decision-making responsibility and at the same time favors a particular outcome of the decision.

For this reason, Shell, as the organization responsible for designing, approving, and implementing the tow plan, is considered to be ultimately responsible for this accident, concludes the report investigators.

The report is available here.

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China Places Mobile Artillery on Reclaimed Island

By Reuters 2015-05-29 16:33:11

The United States said on Friday that China had placed mobile artillery weapons systems on a reclaimed island in the disputed South China Sea, a development that Republican Sen. John McCain called “disturbing and escalatory.”

Brent Colburn, a Pentagon spokesman travelling with Defense Secretary Ash Carter, said the United States was aware of the weapons.

McCain, chairman of the Senate’s Armed Services Committee, said the move would escalate tensions but not lead to conflict.

“It is a disturbing development and escalatory development, one which heightens our need to make the Chinese understand that their actions are in violation of international law and their actions are going to be condemned by everyone in the world,” he said at a news conference in Ho Chi Minh City.

“We are not going to have a conflict with China but we can take certain measures which will be a disincentive to China to continue these kinds of activities,” he said.

In Beijing, China’s foreign ministry spokeswoman Hua Chunying said she had no information on the weapons.

U.S. officials say Chinese dredging work has added some 2,000 acres to five outposts in the resource-rich Spratly islands in the South China Sea, including 1,500 acres this year.

It has released surveillance plane footage showing dredgers and other ships busily turning remote outcrops into islands with runways and harbours.

Carter called on Wednesday for an immediate halt to land reclamation in the South China Sea and was expected to touch on the issue of maritime security and freedom of navigation again on Saturday in a speech at the Shangri-La Dialogue security conference in Singapore.

China says the islands are in sovereign Chinese territory.

Pentagon officials said efforts by China and other claimant countries to turn reefs into islands in the Spratlys undermines international law and raises questions about their future plans and intentions.

“It creates an air of uncertainty in a system that has been based on certainty and agreed-upon norms,” said Colburn, the Pentagon spokesman. “So anything that steps outside of the bounds of international law we see as a concern because we don’t know what the … motivations are behind that. We think it should concern everyone in the region.”

Asian military attaches and analysts said the placement of mobile artillery pieces appeared to be a symbol of intent, rather than any major development that could tilt any balance of power.

“It is interesting and a point to watch. But it should be remembered they’ve already got potentially a lot more firepower on the naval ships that they routinely move through the South China Sea,” one military attache said.

China claims most of the South China Sea. The Philippines, Vietnam, Malaysia, Brunei and Taiwan also claim parts of the vital trade route. All claimants except Brunei have military fortifications in the Spratlys.

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Asia Vows to Rescue Boat People

By Reuters 2015-05-29 16:32:19

Southeast Asian nations agreed on Friday to intensify search and rescue efforts to help vulnerable boat people stranded in the region’s seas, as Myanmar said its navy had seized a vessel off its coast with more than 700 migrants aboard.

More than 4,000 migrants have landed in Indonesia, Malaysia, Thailand, Myanmar and Bangladesh since Thailand launched a crackdown on people-smuggling gangs this month. Around 2,000 may still be adrift in boats on the Andaman Sea and Bay of Bengal, the United Nations said.

Countries affected by the crisis agreed at a meeting in Bangkok to set up an anti-trafficking task force and approved a wide-ranging list of recommendations to tackle the root causes of the crisis – although the plan was carefully worded to avoid upsetting Myanmar, which denies it is the source of the problem.

Just as the meeting was wrapping up in Bangkok, Myanmar’s Ministry of Information announced its navy had intercepted a boat with 727 “Bengalis” on board and was taking them to a base on an island off its southern coast to determine their identity.

“That the summit took place at all with this wide participation is itself a good result,” William Lacy Swing, director general of the International Organisation for Migration (IOM), told Reuters.

“It’s a very important first step. Having Myanmar there was key. I’m pretty optimistic. We’re pleased that they’ve retained an emphasis on intensifying search and rescue operations.”

While some of the migrants are Bangladeshis escaping poverty at home, many are members of Myanmar’s 1.1 million Rohingya Muslim minority who live in apartheid-like conditions in the country’s Rakhine state.

Myanmar does not consider the Rohingya citizens, rendering them effectively stateless, while denying it discriminates against them or that they are fleeing persecution. It does not call them Rohingya but refers to them as Bengalis, indicating they are from Bangladesh.

The final statement from the meeting on Friday included a paragraph that called for addressing factors in the areas of origin of migrants, including “promoting full respect for human rights” as well as investing in economic development. It did not mention Myanmar by name.

Myanmar signed off on the agreement, Htein Lin, director general at Myanmar’s Ministry of Foreign Affairs and head of the country’s delegation told Reuters after the meeting.

“It’s not only about Rohingya, in your terms – in our terms, not only for Bengalis,” he said.

“The language (in the document) speaks for itself. For Myanmar, root causes are development and a sense of security for all people living in Rakhine state and the rest of Myanmar.”

In his opening remarks to the meeting earlier, he had sharp words for those that blamed Myanmar for Southeast Asia’s migrant crisis.

“You cannot single out my country,” he told delegates. “In the influx of migration, Myanmar is not the only country.”

ROOT CAUSES

The Bangkok gathering brought together 17 countries from the Association of Southeast Asian Nations (ASEAN) and elsewhere in Asia, along with the United States, Switzerland and international bodies such as the UNHCR, the UN’s refugee agency, and the IOM.

One delegate said Myanmar had pushed for other participants not to use the term “Rohingya” and that most were respecting Myanmar’s request.

Htein Lin said nobody had raised “the Rohingya question.”

Volker Turk, Assistant High Commissioner for Protection at the UNHCR, said earlier the deadly pattern of migration could only be ended if Myanmar addressed discrimination against its Rohingya minority.

“This is a very good beginning,” Turk said after the meeting. “There is a strong paragraph on root causes in the agreement… There is a sense of opening from Myanmar that I welcome. There was a discussion about Rakhine State.”

There were also pledges of money to help deal with the crisis from the United States, Australia and Japan.

PEOPLE SMUGGLING CAMPS

Officially called the Special Meeting on Irregular Migration in the Indian Ocean, the gathering took place against the grim backdrop of Malaysia’s discovery of nearly 140 graves at 28 suspected people-smuggling camps strung along its northern border.

Thai authorities had found 36 bodies in abandoned camps on their side of the border at the start of this month, which led to the crackdown.

When the Thai crackdown made it too risky for traffickers to land migrants, they abandoned thousands at sea, triggering the crisis.

Regional governments have struggled to respond, although images of desperate people crammed aboard overloaded boats with little food or water prompted Indonesia and Malaysia to soften their initial reluctance to allow the migrants to come ashore.

Malaysia, which says it has already taken 120,000 illegal immigrants from Myanmar, and Indonesia said last week they would give temporary shelter to those migrants already at sea, but that the international community must shoulder the burden of resettling them.

Thailand has refused to allow the boats to land, saying it is already sheltering more than 100,000 migrants from Myanmar, but has deployed a naval task force to offer medical aid at sea.

Thailand said on Friday it had given the United States permission to fly surveillance flights over Thai airspace to identify boats carrying migrants.

“We have to save lives urgently,” U.S. Assistant Secretary of State Anne Richard told reporters before the meeting. U.S. air missions were already operating from bases in Malaysia, she said.

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International Day of United Nations Peacekeepers

By MarEx 2015-05-29 17:58:22

On the International Day of United Nations Peacekeepers, May 29, United Nations Secretary-General Ban Ki-moon stressed the invaluable contribution of peacekeeping to the history of the organization and reaffirmed his commitment to improving the effectiveness of “blue helmets” in the coming years.

“Since its beginning in 1948, United Nations peacekeeping has evolved into one of the main tools used by the international community to manage complex crises that threaten international peace and security,” said Mr. Ban in message to mark the Day.

“Throughout its history, the United Nations has established a total of 71 peacekeeping operations. More than one million military, police and civilian personnel have served as U.N. peacekeepers, including 125,000 in the sixteen missions in operation today.” Through years of struggle and sacrifice, the iconic Blue Helmet has earned its place as a symbol of hope to millions of people living in war-ravaged lands.

The International Day of United Nations Peacekeepers is an occasion to salute the peacekeepers of today who serve in some of the world’s most volatile and dangerous environments. It is commemorated each year on 29 May because that that was the date in1948 when the U.N. Truce Supervision Organization (UNTSO) – the world’s first peacekeeping mission – began operations in Palestine.

“This Day is also a time to mourn fallen peacekeepers,” said Ban. “During its history, more than 3,300 “Blue Helmets” have died devoting their lives to peace, including 126 men and women in 2014.”

To mark the Day at U.N. Headquarters, the Secretary-General participated in a wreath-laying ceremony in the morning, then presided over a ceremony at which the Dag Hammarskjöld Medal was awarded posthumously to the military, police and civilian personnel who lost their lives while serving in peacekeeping operations last year.

Currently, demand for U.N. peacekeeping operations is at an all-time high. Operations receive contributions of military and police personnel from 122 member states.

“United Nations peacekeeping has given life to the U.N. Charter’s aim to unite our strength to maintain international peace and security,” said Ban. “Through years of struggle and sacrifice, the iconic Blue Helmet has earned its place as a symbol of hope to millions of people living in war-ravaged lands.”

In a press conference at headquarters, the Under-Secretaries-General for Peacekeeping and for Field Support, Hervé Ladsous and Atul Khare, also reflected on the service of Blue Helmets who served the U.N. in the cause of peace in what he described as a “difficult world” but one in which there were extensive efforts to adjust to and rise to the expectations of the international community.

“It’s an opportunity to reflect on the nature of the threats that we face on the ground,” said Ladsous, on the evolution of peacekeeping in the modern world. “More than ever our obligation is to improve performance. We improve on performance by the use of up to date technology.”

He said that did not mean merely the use of high-tech equipment like Unmanned Aerial Vehicles (UAVs) but was about putting a lot more technical means, many of which were available on commercial markets, to improve safety and security.

This idea was echoed by Khare, who also underlined the need for availability of a wide variety of technology to counter the many “grave and asymmetrical” threats faced by peacekeepers as they discharged their complex mandates and he outlined his priorities for his tenure. They were to improve rapidity and proactivity of support, as well as its effectiveness and the efficiency with which it was delivered.

He said he was “truly humbled” to receive the Dag Hammarskjöld medal on behalf of civilian peacekeepers, and noted that of the 126 peacekeepers who died last year, 19 were civilians, which he noted was a large proportion of the total.

“Today is a day for reflection and gratitude for the service of peacekeepers,” he said. “But today is also a day of introspection, of reflection, on the sacrifices that serve as a stark reminder of the massive challenges that we face on the ground every day.”

U.S. Tribute

John Kerry, U.S. Secretary of State said:

“Today we honor the service and sacrifice of the courageous men and women serving under the flag of the United Nations with the mission of peace. That mission, which dates back nearly 70 years, is central to the purpose of the United Nations and indispensable to the peace and security of the globe.

“Nearly 130,000 courageous U.N. peacekeepers from 122 countries serve the cause of peace, nearly two-thirds in conflict areas where they operate under robust and demanding mandates often at great personal risk. This is by far the greatest number of active peacekeepers in history – a fact that reflects the steadfast determination of the international community to respond.

“And just as the demand for peacekeeping has grown in recent years, so have the demands placed on those missions. Mission mandates have evolved in critically important ways to address the most pressing needs on the ground, including the protection of civilians. While we ask more of peacekeepers, we as a global community must strive to ensure that they possess the necessary training, tools, support and resources to advance the cause of peace.

“The United States supports such requirements through robust capacity building programs such as the Global Peace Operations Initiative and International Police Peacekeeping Operations Support. We look forward to continuing work with our partners to strengthen U.N. peacekeeping, including at the Summit that President Obama will co-host this fall, on the margins of the U.N. General Assembly high-level week.”

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