Govind Gautam Presentation

1. CREATING WEALTH IN SHIPPING
AMIDST RAPIDLY CHANGING SCENARIOS
“SHIP OPERATIONS-ITS IMPACT
ON FINANCIAL GAINS OF A CHARTER”
Capt. Govind Kumar Gautam
Managing Director
Fastfreight Pte Ltd Singapore

2. BRIEF INTRODUCTION- SELF
• Graduated as Bachelor of Science ( Nautical Sciences) in 1992 from T S Rajendra , under University of
Mumbai through IIT JEE.
• Sailed on board since 1992- 2005 : Various ranks including Master ( Captain) – Mainly On Tankers ( Crude ,
product and Chemicals) and dry bulk .
• MBA ( Full time) – Finance and Strategy– University of Hong Kong – 2005- 06
• Headed – Intertek Hong Kong – April 2006 to October 2007
• Served with SSG – ( Shun Shing Group) since 2007 till Feb 2019 in various ranks from Technical manager to
CEO .
• Instrumental in starting PWSL in 2009 at Singapore and managing it till end Feb 2019 as a CEO of company
with branding, marketing and positioning PWSL as a Global reputable brand in Operating buz and had to
move on thereafter with Fastfreight Pte Ltd to explore further challenging opportunities.

3. Brief introduction- Fastfreight Pte Ltd, Singapore
What we do
Fastfreight Pte Ltd is a Singapore based ship operating company, one of the
Aethon Group backed subsidiary to provide freight services to global clients
in the Dry Bulk sector. We aim to provide competitive freight and shipping
solutions to our clients with our strong regional network supported by our
dedicated and professional team.
Services
• Spot to Forward Freight
• Short to Long term COA and projects
• Short to Long term Period Vessels
• Operational , Commercial and legal solutions

4. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
• Focus of Today Seminar is relating to Ship Operations which is closest to my heart as I love it and its my
passion. Shipping is nothing but Synonym of Samasya (own philosophy) .One have no option but to love to
solve it.
• Operating Business is nothing but providing a commercial freight solution by an owner/operator to a
charterer encapsulating all underlying risks . ( Like Specialist Doctor) .
• Complex Process involving various counter parties and a very knowledge intensive business – No short cuts
. Please !
• Whether its an owners or operators or charterers - There are two functions at each party – Ship Chartering (
Pre-fixture ) and Shipping operations ( Post- Fixture).
• Chartering( Pre-fixture) Mistakes/errors Can impact much more financially than financial impact caused
due to errors committed by Operations team in Operations.

5. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
CHARTERING (PRE-FIXTURE ) RISKS
① Human Risks- Biggest Risk- Constantly recruiting , training and building up a right trusted team.( My greatest
teachers are some of my ex- colleagues)
② Counter Party Risks – Right Owners and Right Charterers -Miners/traders default / owners default
③ Market Risk- Supply and Demand
④ Negotiation risk –Draft Offer /CP terms (Risk arising due to NYPE CP & Gencon CP, Cargo exclusions , Trading
exclusions , commodity related risks etc..etc.
⑤ Assumptions Risk - Managing “assumptions” risks – Hedge management - Bunker and Charter Hire -no
assumptions within assumptions -
⑥ Technical and Legal Aspects at time of fixing
⑦ Financial risks- Credit and Cash flow management
ONCE MISTAKE AT CHARTERING HAVE BEEN DONE , ITS IRREVERSIBLE AND WE HAVE TO LIVE WITH IT AS CPs ARE LIKE
OUR HOLY SCRIPTS AND HAVE TO BE COMPLIED. FOR CHARTERING ERROR, OPS CAN ONLY DO FIRE FIGHTING TO
REDUCE/MINIMISE FINANCIAL LOSS/RISKS WITHOUT GUARANTEE.

6. RISK MANAGEMENT - NYPE AND GENCON
CP – RISKS
Gencon
• PWWD
• Shexeiu/Office Hours
• No protection against AF
• Underperformance at Sea- NA
• PDA Exposure- NA
• Jurisdiction –Local
• Lifeboat clauses
• Warranties
• CP holidays
• Strike clause – 50%
• Several other clauses
Nype
• All time to count
• May have to pay despatch
• Antifouling cost
• To apply
• To Apply specially Extra Berth hire
• Jurisdiction- International
• No such clauses
• Warranties – Discrepancies
• Not to apply
• Strike clause
• Several other clauses

7. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
ROUTINE OPERATIONS FUNCTION- IMPACTING FINANCIAL GAINS OF A CHARTER
1. INITIAL MESSAGE TO MASTER IMMEDIATE AFTER FIXING ADVISING SAILING INSTRCUTIONS AS WHAT TO DO AFTER DELIVERY OF VESSEL
2. ECO SPEED OR FULL SPEED- OPS MUST VERIFY BY OWN CALCULATIONS AND RECONFIRM FROM MASTER …TO GO AS PER WARRANTED
SPEED/CONSUMPTION.
3. IF ANY SPECIFIC ROUTES TO FOLLOW AND PARTICULAR ETA AT RV POINT TO PICK UP PILOT ETC
4. STOWAGE PLAN – SF, LL ZONE, LOAD DENSITY, WATER DENSITY ETC.
5. HOLD PREPARATION – SPECIFIC INSTRUCTIONS AS PER CHARTERERS REQTS BASED ON CARGO TO LOAD (SALT, IRON ORE AFTER COAL, FERTILIZERS,
SBM, GRAINS, STEEL COILS , LOGS ETC )
6. AIRDRAFT REQTS – BALLAST MANAGEMENT
7. ON HIRE BUNKER SURVEY REPORT
8. NOR – DISPUTE ON ARRIVED VSL /MANAGING ETA AS PER CP TERMS SHEX, SHEX EIU,FHEX/FHEXEIU.
9. PROTESTS FOR SHORT LOADING , DAMAGE TO HULL /STEVEDORE DAMAGE AT LOAD PORT
10. CRANE ISSUES/EXTRA PORT COSTS /SHORE CRANES /PENAL BERTH CHARGES – USE PORT CAPTAIN
11. BUNKER STEM /BUNKER BARGE DELAYS – PROTEST FOR DELAYS /SHORT BUNKERS /BDN CLAUSING
12. BUNKER – NO LIEN CLAUSE- COST EXTRA MONEY

8. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
ROUTINE OPERATIONS FUNCTION- IMPACTING FINANCIAL GAINS OF A CHARTER
13. ON HIRE /OFF HIRE BUNKER SURVEYS - EXTRA BUNKERS TO CATCH
14. MARKET FLUCTUATIONS ON BUNKER – SWAPS/HEDGE MANAGEMENT
15. PDA NEGOTIATION – COMPETITIVE PDA- LIKE CAR MANUFACTURING COMPANY
16. MANAGING TURN AROUND TIME – IN LIASION WITH CHARTERERS
17. DISCHARGING WITHOUT FREIGHT –NOT ADVISABLE BUT !! -SAVED MAY BE MILLION DOLLAR –IN GOOD FAITH
AND TRUST .
18. ERROR IN LAY TIME CALCULATIONS – SIMPLE – TO HAVE DOUBLE CHECK SYSTEM
19. PORT CONSUMPTIONS OF VESSEL VS CP
20. UNDERPERFORMANCE CLAIMS
21. FDA FINALISATION WITH EACH AGENT
22. FINALISATION WITH OWNERS & CHARTERERS – KEEP THE GOOD RELATIONSHIP
23. COLLECTION OF MONEY – MOST CRITICAL PART ….
24. COUNTER PARTY DEFAULT INSURANCE

9. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
CASE STUDIES – OPERATIONAL PROBLEM IMPACTING FINANCIAL GAINS OF CHARTER
Biggest role of operations is realized when one can save financial impact to a company , when ops
team/PIC/company can think out of box to deal with external factors which are not clearly defined/dealt in CP.
Some of case studies asf:-
• VESSEL WITH INDONESIAN COAL- “WILL NOT GIVE VSL NAME OR COUNTER PARTIES NAME AS MATTER IS STILL IN ARBITRATION”
• BOTTOM MOST CARGOES – REQUIRING MAN ENTRY
• ATMOSPHERE CHECK SHOWS - HIGH CARBON MONOOXIDE
• WHAT TO DO ?
• PLS ADVISE MASTER ROLE, OWNER ROLE , CHARTERER ROLE , OPERATOR – OPS ROLE .

10. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
CASE STUDIES – OPERATIONAL PROBLEM IMPACTING FINANCIAL GAINS OF CHARTER
 Counter Party Risks- Owners related – Chinese vessel called at Chittagong – Local navy on board and
cant allow discharge despite two times vessel been in chartered with us …. Allegation that it has got
some North Korean connection
• What to do ?
 One vessel failed M/E immediately after sailing Yangzi river and stuck for more than 6 months due to
owners have no money – Vessel fixed with us two times in past !
• What to do ?
 Vessel arrived at load port – Charterers don’t have cargo ready to load – 20 days waiting for cargo ..
Still no cargo ..!
• what to do ?
 Charterers default issue/ Bankrupcy ?
• What to do ?

11. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
RISK MANAGEMENT- SHIPPING OPERATIONS
 Human Risks- No Assumptions within Assumptions
• PDA
• Bunker estimate vs Stem – Cancelation /Unavailability – RBCT / Colombo despite hedge management
• Shexeiu vs Shinc
• Bad Wx
• Sea Margin
• CP holidays / Local Holidays
• CP clause – Mutual in Nype for off hire settlement or for underperformance
• Deductibles and LMAA cost

12. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
RISK MANAGEMENT- SHIPPING OPERATIONS
 Technical and Legal Risk in a fixture
Lack of Technical , legal and operational experience while fixing
-High Density cargo , High Moisture cargo
- Steel cargo – Stowage Planning
- Grain Cargo – Fumigation
- Bagged Cargo – Tally obligation Vs Draft survey for BL Qty
- BL- Switch BL
- Delete “ Mutual “ word any where in CP
- Stevedore damage and repair obligation
-To have a good P & I Club with a good solicitors team to seek clarification without hesitation in doubts.

13. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
RISK MANAGEMENT – SHIPPING OPERATIONS
 Hedge Management
• Swap/ Options- Call & Put / Collar – Bunker
• FFA – Charter Hire
( Requires a clearing bank, Clearing House and a Broker with margin management )
 Escalation Effect – Learning by Doing
- Hard to predict but good to ask question “what if …..” – Charterers /Miners/Owners Default
 Credit and Cash Flow Management
- Depending on duration of voyage – own cash flow , counter party cash flow & CP terms on collection

14. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
CONCLUSION
• Operational excellence with SOP in managing communication with vessel, owners, charterers , agents , bunker
suppliers, legal, P& I club, shippers and receivers from delivery till re-delivery.
• Managing errors committed in Pre-fixture – Technical and legal expertise
• Detail Risk Management Check List
• Hedge management
• Counter party checks and approval system
• Authority matrix
• P & I Club and Solicitors to advise on W/P basis
• No overpayment – Strict policy and procedure
• PDA payment and collection
• Lay time calculation, agreement and collection of demmurage
• Bunker stem – Credit with T & C
Shipping operations is nothing but delivering strategy of chartering team

15. “SHIP OPERATIONS-THEIR IMPACT ON FINANCIAL GAINS OF A CHARTER”
CONCLUSION
• Escalation effect – Miners/traders default / owners default
• Finalization of voyage P& L– FHS and FFI
• Transparency – IT Solution like SOFTMAR /IMOS/SEVEN OCEAN
• Financial risks- AR Policy , Credit and Cash flow management
• Good team – Commercial, technical and legal understanding
• Changing gears as per market – Taking position on vessel /cargo
• Adopting Technology & outsourcing some jobs like DA & CP
• Branding - Delivering values & creating an impact to customers
Company Culture – “Constant Care & Performance matters”
“Company should not be hit by any losses which could have been avoided by constant care”

16. ......Last but not the least – Fastfreight Pte Ltc – As a freight partner !

17. Lets begin a dialogue
Q & A