Monday, May 25, 2009

Shippers spend extra to ward off pirate attacks

The rampant piracy attacks off the coast of Somalia, a major sea lane for the world’s oil transportation, are costing shipping companies an arm and a leg to install extra security measures.

Some have even opted to avoid the high-risk area by taking a longer journey via the Cape of Good Hope.

Pottengal Mukundan ... These options to avoid or repel the pirates are not cheap.

More than 30% of the world’s oil is transported through the Gulf of Aden, off the coast of Somalia.

International Maritime Bureau director Captain Pottengal Mukundan said about 22,000 vessels transited the Gulf of Aden annually and it was the main shipping artery from Asia and the Arabian Gulf to Europe and vice-versa.

“To avoid being the victim of pirates in that area, ship owners are installing extra security measures such as unarmed security personnel on board and installation of razor wires around vessels.

“Some even re-route their journey via the Cape of Good Hope that translates into two to three weeks’ extra journey to reach Europe.

“And these options to avoid or repel the pirates are not cheap,” he said at the Kuala Lumpur International Conference on Piracy and Crimes at Sea organised by Foreign Affairs Ministry last week.

According to International Association of Independent Tanker Owners (Intertanko), re-routing a tanker en route from the Arabian Gulf to the east coast of the United States, via the Cape of Good Hope instead of using the Suez Canal, would increase costs by about 30%.

Intertanko represents about 80% of independent tanker fleet globally.

However, the extra precautions are necessary to avoid falling victim to pirates off the coast of Somalia whose modus operandi includes hijacking of vessels and kidnapping of crew which can result in a more expensive costs in terms of paying ransom money, and losing multi-million dollar worth of cargoes and vessels.

The Somali pirates were reported to have earned about US$80mil in ransom payments last year.

And pirate attacks can also cause cracks on a tanker that might result in oil spill, which will be detrimental to the local marine environment.

According to the association, about 22% of the ships attacked by pirates off the coast of Somalia since last December were tankers.

However, Intertanko regional manager (Asia-Pacific) Tim Wilkins said there were no reasons to believe that tankers were specifically targetted by pirates in that area.

“It is based on random attacks to vulnerable vessels,” he told StarBiz, adding that 80% of the attacks were prevented by the vessels’ self-protection measures.

On the question of paying the ransom money or not, Mukundan said that in Somalia, where there was no mechanism to help shipowners whose vessels were hijacked and crew kidnapped, paying the ransom seemed to be the only option for now.

International Maritime Organisation (maritime security and facilitation) deputy director Nicolaos Charalambous said shipowners needed to be extra vigilant when transiting the high-risk area.

“I note that shipping organisations worldwide are trying to educate their members. But some ship operators take the matter light-heartedly,” he said.

In a presentation titled Overview of The Global Piracy Situation, Charalambous said that generally, the acts of piracy and armed robbery against ships had been declining and the numbers for 2007 and 2008 were heavily influenced by the situation in the waters off the coast of Somalia.

“The east and west coasts of Africa account for 61% of the total number of incidents reported globally last year and 75% of the incidents reported since Jan 1 this year,” he said.

Source: StarBiz

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