COLUMN | Do shipping’s elites face dilution? [Grey Power]

Cesi Qingdao in 2017 (Photo:[email protected])

You could argue that bad things happen to the best of us, and even a Rolls-Royce can suffer a breakdown, although perhaps not so often than the run-of-the-mill vehicle.

Still, there must have been a certain amount of surprise when it was revealed that the big LNG carrier Cesi Qingdao had been banned by the Australian Maritime Safety Authority (AMSA) for 180 days after she caused a major disruption in the port of Gladstone. The ship appears to have suffered a major blackout, effectively blocking up the loading berth, with no fewer than four of her generators being found faulty and one having to be entirely rebuilt. Eventually the ship was towed away for permanent repairs in China and the business of exporting from Gladstone resumed.

It is not the sort of incident you expect with units operating in this branch of the energy sector, known for at least the last half-century as the crème de la crème of ship operating excellence. The people at AMSA, bless them, have a reputation themselves for a very much needed intolerance of sloppy and dangerous ship management and come down hard in their port state control role on malefactors, but to see a unit of the LNG fleet in such a situation was surprising. If you have a beaten-up bulker or a time-expired tanker, or are a trifle casual about maintenance, or if you cheat your crew out of their wages, you are best advised to steer clear of Australian waters. As regulators, AMSA have a reputation that could be more widely emulated.

“There were never any half-measures taken in the design of LNG carriers, the terminals, or the gas trains themselves.”

The formidable reputation of the LNG sector was established very early on in its lifespan and has largely been maintained over the years. It began with some quite extraordinary apprehension about the inherent hazards of shifting this volatile cargo by sea, with some commentators likening its dangers to that of nuclear explosions. I remember in the 70s, when passing an LNG carrier moored at its terminal in the Thames, the pilot would warn everyone to extinguish their cigarette lest a plume of the volatile gas drift across a half mile to the deep-water channel and catastrophically ignite.

This was probably ridiculously overcooked, but there were real fears expressed over just about every LNG terminal by planners and worried inhabitants who needed to be reassured that some emergency from the ships or storage tanks would not have them all immolated in a gigantic fire. I recall reading some alarming paper illustrated with alarming diagrams showing how the prevailing winds could carry a plume of methane across a sizeable city, just waiting until the touch paper could be inadvertently lit. And in the very early days, such fears were given a degree of reality by some terrifying tests that demonstrated the explosive power of LNG dumped over an ignition source.

It is probably because of these initial fears that there were never any half-measures taken in the design of LNG carriers, the terminals, or the gas trains themselves. There was the most careful research, the most stringent regulations, and an estimable degree of technical co-operation on safety and standards. It began as an exclusive sector, building ships at what seemed a staggering price, mostly against very long-term contracts and was for many years somewhat self-selecting to a few participants with deep pockets. There were a few very harsh lessons for those who attempted to build on spec, without cast-iron guarantees of employment. The volatility of the energy market also demonstrated that this was not a sector for the faint-hearted.

“LNG carriers feature but rarely in lists of detained or deficient ships.”

Throughout all the ups and downs, the LNG carrier operators, unlike the less particular folk in the maritime mix, never stinted on their maintenance or their approach to quality and operational excellence, all of which is reflected in the formidable record of safety in this sector, compared to every other, in the maritime world. The ships are regularly updated and beautifully maintained, something that has been demonstrated by the long lives of many of the earlier units.

The arrival of new players into the fast-growing LNG sector has sometimes led to concern that the expertise in ship operating might be somehow diluted. Are there sufficient experts familiar with the required standards to go around? The Society of International Gas Tanker and Terminal Operators, which has been in operation for nearly 45 years, has done much to promote and promulgate the sector’s excellence and helps to ensure that any newcomers can acquire the necessary expertise on operating these specialised ships.

You might say that the proof is in the record, which is why LNG carriers feature but rarely in lists of detained or deficient ships.

Michael Grey

Maritime industry legend, and former long-term editor of Lloyds List, Michael Grey kicks off each month with topical issues affecting the maritime world at large.