Gulf Energy Maritime (GEM) operates 19 tankers worldwide, carrying oil, chemicals, and gas. It employs 750 crew from India and the Philippines to man its vessels. GEM trades on long-term contracts with oil majors and in the spot market. The commercial tanker market is driven by oil demand and supply. Rates are determined by the balance of tankers available versus cargo needs. Safety is the top priority for GEM and the shipping industry. Extensive laws, industry codes, and company procedures govern vessel preparation, cargo handling, crew training, and security to ensure safe operations and environmental protection. Issues facing shipping include a shortage of qualified crews, commercial and regulatory pressures,

1. Diversity of Shipping
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Capt. Robert Buckham
CSO, Gulf Energy Maritime
MIEVOM 22nd April 2018

2. Overview of GEM
• Began trading operations in 2004.
• 4 shareholders - 3 major shareholders from GCC
• Currently have 19 vessels in fleet - Chemical and Product
Tankers ranging from 37,000 to 115,000 dwt.
• Worldwide trading – Loading Arabian Gulf proceeding
Europe, Far East, Africa, Australia and the Americas
• Employ approximately 750 officers and ratings, own
manning agency in India and 50 office staff in Dubai
• Officers are predominately Indian with Filipino crew, also
use Romanian, Croatian and Russian officers and 4
vessels have Indian crew
• Vessels on TC with several oil majors as well as spot fixing
vessels on the open market using in house chartering
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3. Diversity of Shipping
• All companies conduct their business differently. End goal is the
same – differing strategies - but!!!
• Purpose of every business – “Earn Money”
• Ships earn “Freight” by carrying and discharging a cargo
• Industry demands shipping business is conducted safely, for the
respective charters, the crew and safeguarding the environment
Discuss:
1. Commercial Market
2. What cargo – oil, chemical, gas?
3. How do we get the cargo?
4. How do we prepare a ship for the cargo – Its Importance, Issues
5. Legislative, Industry and Company safety
6. Security – Not just piracy
7. Industry Issues
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4. The “Commercial Market”
Tanker “rates” the amount shipowner is paid per day, is driven by the balance
between demand and supply.
Tanker demand market has two main drivers:
1. Oil demand from the Consumer
2. Oil supply from OPEC, Oil Trading Companies or Storage
Tanker supply market is driven by three main factors and influenced by one-
off factors – ships used as storage or sudden price changes
1. Ships currently in service – Total 4913
2. New build order book – On Order 513 by 2021
3. Scrapping and removals - New Regulation, Old Age, Market changes
• Ships in service Today
VLCC=723;Suez=508;Afra=979;Panamax=434;MR=1417;
Handy=852 = Total 4913.
• Cost USD of VLCC 80-87m; Suez 50-52m; Afra 41-46m; MR 34-36m
• 130 VLCC cargoes from AG per month – therefore “fierce” competition
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5. Cargo - Type of Ship
• Oil Tanker (Dirty – crude oil) Generally large ships such as Suezmax - 160k
Aframax - 110k, VLCC - >180 to 320k and ULCC - >320 Dwt
• Product Tanker (CPP or DPP) Generally 55,000 to 120k Dwt
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6. Cargo - Type of Ship
• Chemical ( Type 1, 2 or 3 dependent upon environment and safety hazard
of cargo) Most are type 2 and 3 as type 1 very specialized. Ships generally
5 – 35K. Tanks of stainless steel or protective coating such as epoxy or zinc
• Specific liner trade use 35 - 47K
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7. Other - Type of Ship
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9. How do we get a Cargo
• Oil majors and energy trading companies have access to
refineries
• Brokers working on behalf of a client will offer a cargo for
transportation
• Brokers approach owners and if cargo is of interest voyage
estimate is conducted - factors considered, vessels
readiness, location of vessel, tank cleaning preparation,
cargo quantity, bunker consumption and Charterers
• Broker will relay indication to the Charterer and if
interested the Charterer will request a firm offer.
• Firm offer will include the main terms of a CP with a reply
time – Counters - ‘on subjects’ once main terms are agreed
• Approvals – load port, discharge port, vessel certificates
• Voyage orders received
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10. Vessel and Tank Preparation – Importance
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11. Considerations
• Owner is responsible for preparing the tanks – independent
inspection by surveyors
• Owners is responsible for the safe carriage of the cargo and delivery
of the cargo - Bill of Lading
• Require competent, experienced persons for operations especially
on chemical or gas ships – Cargo endorsements
• Time frame for cleaning can be several days to many weeks
depending upon the last cargo carried and the next cargo loading
• Commercial pressure upon the Masters and crew to complete the
job
• Work load upon the crew – 18 to 24 persons onboard
• Work and rest hours, fatigue
• Health issues – last cargo, dangers of explosion, inert gas, enclosed
space entry and PTW - Safety
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12. Legislative Safety
• Safety First - taken very seriously – Number 1 element
1. SOLAS – Introduced in 2014 after Titanic
2. Marpol – Introduced in 1973 and Mandatory 2nd
October 1983
3. ISM Code – Mandatory 1st July 1998
4. MLC - Seafarers bill of rights Mandatory 20th August
2013
• These are regarded as “4 Pillars of Safety and Security”
for the Quality Shipping Industry
• Seafarers are 27.8 times more likely to suffer
work related fatal injuries than shore workers
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13. Industry Requirements for Safety
• International Safety Management Code (ISM) DOC -
Safety Management System – Policy and procedures
for safe operation, safe working environment - assess
all identified risks to its ships and personnel - scope for
continual Improvement - Achieved by:
1. Internal Audits – 1st Party by Company on its vessels
2. External Audits - 3rd Party – Class Certification
3. Commercial Assessments – 2nd and 3rd Parties – TC
TMSA
4. Flag State Inspections – Compliance Convention and
Legislation
• SIRE Inspections – Oil Major Inspections
• Port State Control – Compliance and Standard of
Shipping within its territorial waters
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14. Company Requirements for Safety
• Develop a “Safety Culture” – Onshore and Onboard – Promote
company values - Shared perception – every body doing it
right
• Leadership – Office Involvement from the top
• Motivation – Happy seafarers?
• Well Trained – Shipboard and onshore
• Training days onboard – Familiar with equipment
• Training drills – Mandatory and Regulatory
• Safety Trainers visit – 10 day each year
• Officer and Crew seminars – Jollyboys outing and Family days
• Every job is Risk Assessed – hazards mitigated, toolbox
meeting, BBS and stop work cards
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15. Company Requirements for Security
“Documented Procedures” to Identify Threats of
• Petty Theft
• Vandalism
• Stowaways
• Cargo theft
• Inadequate port security
• Trafficking of people, arms
or drugs
• Smuggling
• Piracy
• Sabotage and arson
• Terrorism
• Cyber security
• Travel policy
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16. Issues
Safety and Security
• Shipping High Risk Business – Reputations!
• Shortage of competent seafarers – The Human Element
• Long periods away from home, social isolation, long work
hours, fatigue and quality rest
• Commercial and regulatory pressures – more frequent
inspections and admin tasks – more scrutiny from everyone
• Stress – Compounded when transiting HRA areas – Why?
• Social Media – Facebook, whatsapp, twitter; Social Media
Policy to ensure ‘Rest”. Social media groups
• Mental Health – ITF study 600 seafarers, 14% often
depressed, 50% sometimes depressed, 52% know onboard
persons depressed and 23% know persons considered suicide
- Australia issued Maritime Safety Awareness Bulletin in
March 2018 and studies are being further conducted in UK
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17. Shipping of Diversity
Thank you
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