Having been described as "Eurotrash" on Twitter/X.com by the editor of a rival maritime publication this week, I am focusing on something that should unite the whole maritime industry: preventing unnecessary deaths in the shipping and offshore industries.
Unfortunately, this last week has been shocking, with two separate incidents claiming over 18 lives in Indonesia and Mozambique.
Digging into the background, we find that life remains pitifully cheap across the maritime sector, that investors are willing to accept the death of workers and contractors as just another cost of doing business, and they really don’t seem to care.
Finally, there seem to be no consequences for the leadership of certain companies that fail to implement safety measures to protect their people from fatal accidents and harm.
Then there is the attitude of the authorities in many countries, who seem beholden to corporate interests (we can’t think why or how), and utterly unable to conduct transparent and effective investigations, let alone hold anyone to account.
The industry just fails to learn, over and over again, and more and more people die.
We saw this with the tragic accident which claimed the lives of seven onboard the doomed ADES-owned jack-up Admarine 12 in the Gulf of Suey on July 1. That followed on from the roll-over of the liftboat Seacor Power in a squall three hours after departing Port Fourchon, Louisiana, on April 13, 2021, with the loss of thirteen lives, as we covered.
The mother of all catastrophic losses was the Russian jackup Kolskaya, which capsized whilst under tow during a winter fierce storm in the Sea of Okhotsk off Sakhalin Island on December 18, 2011, having just completed an exploration well for Gazprom off the Kamchatka Peninsula.
Fifty-three of those on board were declared missing or dead, and there were only 14 survivors plucked from the icy seas. It was the largest number of casualties in a single accident ever in the history of the notoriously unsafe Russian oil industry.
The Chinese jackup Bohai 2 had suffered an almost exact same roll-over whilst under tow in Bohai Bay in a storm in 1979, resulting in the death of 72 crew aboard.
Who would have thought that bad weather and jackups might be a deadly combination?
In May 2021, India managed to top even Russia and China’s grim death tolls, showing its status as a true BRIC marine power, when the ONGC-chartered barge P305 was left moored on location during Cyclone Tauktae in the Arabian Sea.
You would have thought that the lesson to avoid cyclones and not stay moored on location might have been learnt after the death of 91 on board the DS Seacrest in the Gulf of Thailand in 1989 when that vessel capsized and sank after being hit by Typhoon Guy.
But no.
In ten-metre swells, P305’s moorings failed, it drifted in violent seas and hit an oil platform, then sank, leading to the deaths of 75 passengers and crew.
The tug Varapradha also failed to seek shelter and sank with the loss of 11 out of the 13 seafarers on board in the same cyclone under charter to ONGC. The chief engineer alleged the vessel was old and unseaworthy.
But at least these tragic accidents (and whilst I write “tragic accidents,” several of these incidents were entirely preventable and perhaps should be better described with harsher language) all happened to different companies.
What’s remarkable is that last week, the same companies have suffered a second multiple fatality incident on the same vessel at the same shipyard within four months of the first almost identical occurrence.
Are some people incapable of learning absolutely anything?
In June, an explosion ripped through the 1990-built, 95,759DWT floating storage and offloading vessel (FSO) Federal II whilst alongside for afloat repairs in ASL Marine’s shipyard in Batam, Indonesia, a few miles south of Singapore.
The converted Aframax was undergoing a special survey under the purview of Indonesian classification society BKI, which is not an IACS member. The ship was chartered by Indonesia’s state oil company, Pertamina Hulu Energi, under a seven-year contract that began in 2023 for service as the storage terminal in Widuri oil field in the Java Sea, where the FSO had been deployed since 2014.
The vessel is owned by Indonesian company Eastern Jason, which is itself 30 per cent owned by Singaporean-listed company Federal International 2000, as per Federal’s 2024 annual report. With bitter irony, Federal also specialises in the sale of fire suppression systems and fire extinguishers.
The ship was apparently managed by Monaco-based International Andromeda Shipping at that time, as per S&P Global data cited by TradeWinds. Andromeda’s website states the following:
“Our mission is to operate and manage oil and chemical tankers as well as gas FSOs without causing any incidents or spillages, to fully protect the assets entrusted to us and to create enhanced value for our shareholders and owners.”
However, the vessel no longer appears on the website.
The blast killed five workers (our initial report stated there were four who died immediately, while the Indonesian press claims a fifth died later). The deceased were all subcontractors of ASL, rather than direct employees.
ASL Marine is a listed company on the Singapore Stock Exchange. Its board put out a predictable press release the next day to express their regret:
“We are deeply saddened by this incident [that] resulted in loss of lives and injuries. We extend our deepest and heartfelt condolences to the families of all the victims and as a matter of utmost priority and dedication, we will continue to work diligently with the authorities, the owner of the FSO and our subcontractor to render all necessary assistance to the affected victims and their families.
"The investigations are currently in process and until the cause is established, all work on this FSO has been suspended.”
The Indonesian authorities have alleged that management negligence was the root cause of the accident. Two staff at ASL’s subcontractor responsible for health and safety at the site have been identified as suspects by the Batam police, but have not been named, as per local business publication Tempo.
At the time of writing, nobody seems to have been charged with any crimes that we can see, however, and nobody has been found guilty by any court in Indonesia or elsewhere.
We know work was subsequently restarted on the FSO.
How? Because last Wednesday at around 04:00 local time, another deadly explosion tore apart the same FSO alongside in the same ASL shipyard, this time initially killing ten workers and seriously injuring 18.
However, Indonesian reporters at Tempo now claim that an eleventh victim has died. Once again, a plume of thick smoke hung over the damaged FSO and the sound of ambulances and emergency vehicles' sirens wailed out as first responders rushed to the scene to treat the injured and contain the fire.
The Jakarta Globe claimed that this time around, there were deaths amongst ASL’s own staff at the yard, but this has not been independently confirmed because, as of 07:00 on Monday morning, ASL has not issued any statement whatsoever.
The Batam police have questioned 22 witnesses in the investigation into the second blast on board Federal II. As per reporting from Annisa Febiola, these include, “those who had knowledge of, witnessed, or heard the incident, ranging from ASL Marine Shipyard management, contractors' management, to subcontractors.”
This second explosion is horrific, unbelievable, and inexcusable.
What’s worse is that shares of neither Federal, the part owner of the FSO through Eastern Jason, nor ASL Marine, the owner of the shipyard where the work was being performed, and whose subcontractors were killed, did not fall as a result of the news of the significant fatalities in this second blast.
Instead, ASL’s shares have tripled since before the first explosion, moving from six cents a share in June to 21 cents at close on Friday. Federal’s shares rose from 14 cents to 19 cents over the same period. Neither moved significantly when news of the second blast was reported. Neither company had issued a statement at the time this article was written, to my knowledge.
The FSO is valued at around US$18 million as per Federal’s 2024 reporting (which is in Singapore dollars converted at US$1 = SG$1.30 for the purposes of this article). Eastern Jason was profitable in 2024 and paid its listed shareholder a dividend.
Two major incidents did not raise a concern from the investors, whether or not the dead were direct ASL employees or subcontractors, and whether or not the Federal affiliate’s vessel has become the scene of multiple deaths on two occasions.
Why? Because they do not impact the companies financially.
Why would investors care when life is cheap in Indonesia and there are no consequences for companies involved in incidents?
How much will the accident directly cost ASL and Federal’s Eastern Jason?
Not a lot in the short term, probably a lot more in the long term.
The families of dead workers in Indonesia are entitled to 28 months of wages for the deaths of their loved ones. So, if we assume that the staff involved were earning US$500 per month, the total payout for the fifteen dead will be around US$14,000 per person and this is covered by the mandatory work accident and death insurance that employers must provide.
So, the insurers pay, and besides, the dead appear to be subcontractors, not employees of either ASL, Federal or Eastern Jason, nor of crew employed by the (former?) manager, Andromeda.
ASL is a publicly listed company in Singapore, controlled by members of the local Ang family. The Ang family collectively holds around 67 per cent of the company’s shares. Last Friday, the company had a market capitalisation of US$166 million, giving the family more than US$111 million of value in their holdings.
As per page 125 of the company’s 2025 annual report, Managing Director and Chairman Ang Kok Tian holds 13 per cent of the shares in ASL, and is the largest single shareholder, whilst Deputy Managing Director Ang Ah Nui holds just under five per cent, and the two other Executive Directors of the company, Ang Kok Leong and Ang Kok Eng, each hold eleven per cent of the company.
Meanwhile, over at Federal, Executive Chairman and CEO Koh Kian Kiong is also the company’s largest shareholder with over 20 per cent ownership in the company.
Federal is only a minority shareholder in Eastern Jason, and obviously has less control over events on Federal II than ASL, which ran the yard where the ill-fated ship was under repair.
However, there are similarities between the two listed Singapore companies that suggest certain opportunities for improvement in governance.
Both companies have leaders who are remarkably long serving. Koh Kian Kiong at Federal was appointed as a Director in 1999, and Executive Director Maggie Koh was first appointed a Director of Federal in 2000.
At ASL, the board resembles an Ang family dinner gathering. Ang Kok Tian was appointed an Executive Director of the company in October 2000, and Chairman of the Board and Managing Director in January 2003. Ang Ah Nui was appointed an Executive Director of the company in October 2000 and Deputy Managing Director in January 2003, whilst the other two executive directors from the Ang family were both appointed to their current roles in October 2002.
There were only two non-executive, independent directors at ASL, compared to the four directors from the Ang family. I guess that reflects their shareholding, but it means there are no checks on the executive leadership.
In light of the catastrophic failures of the shipyard’s safety procedures in Batam and the multiple deaths, one might wonder whether the two independent directors at ASL might be considering their positions on the board, especially as Andre Yeap Poh Leong, who joined the ASL board in January 2003, is currently also a Senior Counsel at Rajah and Tann, the leading Singapore shipping law firm.
I would suggest that it doesn’t look very good “optically” for a shipping law firm of the standing of Rajah and Tann to have one of its senior partners as the director of a company that runs a shipyard where over a dozen people have died in two serious incidents just four months apart. No wrongdoing is implied, but it just doesn’t look great, does it?
The second independent director is Damian Hong Chin Fock, aged 77, who also joined the board in 2003, as per the ASL website. With Mr Yap and Mr Hong having already spent 22 years on board, we wonder what these independent directors are doing to prevent a similar tragedy striking again, and how the management of the company is being compelled to change its operational practices.
I don’t think anyone can deny that something has gone seriously wrong in the management of ASL’s Batam yard. Investors inside and outside the Ang family and the two independent directors should be holding the executive leadership and management to account.
Just a few days before the second accident, the company published an investor presentation that contained statements that look seriously outdated now.
Take the front-page slogan: “Revitalised. Resilient. Ready.” The victims of two unnecessary tragedies at its yard might disagree.
Investors were overjoyed because net profits for the company were up 291 per cent to over US$10 million, debt fell sharply, gross margins increased, and a dividend was declared. ASL achieved over US$35 million of net cash flow from operations during the full financial year to June 30.
Financially, ASL is storming, but at its yard in Batam, things need to change.
“Together with a strong team of 500 employees in Batam and 300 employees in Singapore, we have built up an established reputation and capabilities in various types of ship repair works,” the management told investors.
The first accident might be written off as unfortunate, but to have a second, even worse fatal accident just four months later at the same facility suggests that the company’s risk management processes and safety procedures at the yard need work. ASL definitely has a reputation in Batam, and it is not a good one.
Elsewhere in the world, the directors and management of a company that suffered such incidents might reflect and change course. The investors might demand changes and ask whether a company whose sites are so prone to fatal accidents needs to do things differently.
On Friday, October 10, ASL had announced that its share placement to raise SG$7 million (US$5.4 million) was fully taken up, with 41.1 million new shares issued, and the issue was supported by many of the institutional investors in the company.
ASL said that the proceeds will be used to fund capital expenditures, supporting its business expansion plans.
We would strongly suggest that the company might want to spend the proceeds on reinforcing safety at its Batam shipyard, on all vessels calling there for repairs. It might want to consider changing the management there and in Singapore, and perhaps compensating the families of the dead with more than just the bare Indonesian statutory compensation.
Customers are unlikely to want to repair their ships in a yard where explosions happen frequently. ASL’s long-term success in ship repair depends on raising its standards.
We reported last week how seven seafarers are dead or missing in Mozambique after a service boat capsized in the outer anchorage of the Port of Beira whilst transferring crew to the Marshall Islands-flagged oil and chemical tanker Sea Quest, which is managed by Scorpio Marine Management of India.
Again, it is a completely preventable accident, a needless waste of life, and I don’t even need to read the incident report that the authorities in Mozambique will likely not publish to be able to say that.
Just as people shouldn’t weld in tanks that have not been properly gas-freed on FSOs, nor should jackups be towed into storms, neither should crew launches sink when they are servicing ships in an anchorage, any anchorage, anywhere.
All those senior figures in the industry who lament that the maritime industry cannot attract talent and that young people don’t want to go to sea or engage in honest toil in engineering and welding in shipyards might want to consider just why that is.
One key reason may be that an industry that routinely blows up and drowns its personnel is unlikely to be attractive as a place of work for young people, old people, or anyone with other options.
Make shipping safer, raise safety, raise wages and operational standards, then come back and tell me if recruitment and retention are still a problem.
Background Reading
India’s Scroll has an excellent account of the P305 barge accident and the sinking of the tug Varapradha in the May 2021 cyclone, including chilling accounts from survivors, detailed reportage into the web of subcontractors and ownership of the vessels, and the poor decision-making by charterers ONGC and its maintenance contractor Afcons, which led to the losses of the two vessels and their respective crews.
Scroll reported that, “In statements by the Indian Navy and ONGC, the dead were described as 'BNVs' – brave nature’s victims. But conversations with survivors and crucial email correspondence reveal that the tragedy was entirely man-made and entirely preventable.” Surprise!
The full specifications of Federal II from the time of her first conversion as an FSO for CNOOC as the operator of Widuri Field before Pertamina took it over are here.