INTERGROUP DISCUSSION ON

1
INTERGROUP DISCUSSION ON SOLUTIONS FOR SHIP
RECYCLING
Chris Horrocks Secretary General International
Chamber of Shipping
2
Industry Working Group on Ship Recycling

• BIMCO
• ECSA
• IACS
• ICS
• Intercargo
• Intertanko
• ITF
• ITOPF
• SIGTTO

3
Some simple facts Three separate and distinct
industries

• Shipbuilding
• Shipping
• Ship recycling

4
Some simple facts

• Approx 50,000 ocean-going ships
• Approx 25 year average life
• Recycling is market driven
• Up to 2000 ships a year withdrawn
  for recycling

5
Some simple facts

• Very limited demolition facilities in the
  industrialised world
• China and Turkey have some recycling yards,
  and more may be commissioned in due course
• 80 of the worlds recycling capacity today
  is in Bangladesh, India and Pakistan

6
Some simple facts

• Ships do have potentially hazardous
  materials on board
• A decommissioned ship cannot sail under
  its own power
• There are not enough ocean-going tugs to
  tow old ships to the recycling yards
• Ocean towage is itself a risky activity

7
Some simple facts

• Recycling is concentrated in South Asia
  primarily because of the local use for
  recycled steel

8
Some simple facts

• Scrapping a vessel is a revenue source for
  the shipowner
• Today a shipbreaker may pay 7 million for a
  Capesize bulker
• Traditionally higher prices in South Asia
  than in e.g. China or Turkey

9
An undisputed fact

• The conditions in the recycling yards in
  Bangladesh, India and Pakistan have to be
  brought up to an acceptable standard

10
Another undisputed fact

• The South Asian yards nonetheless offer
• Genuine recycling capability
• Substantial employment opportunities
• Real benefit to local economies

11
Three Pillars of Sustainability

Economic
Environmental
Social
12
Basic conclusions

• We need recycling facilities
• For the foreseeable future, only
  Bangladesh, India and Pakistan have the
  necessary capacity
• The system works, but the conditions must
  be improved

13
Solutions?

14
Four issues to address

• IMO Convention on Ship Recycling
• Improve facilities in recycling yards
• Designate approved recycling yards
• Involve the shipbuilding industry

15
IMO Convention on Ship Recycling

• Industry guidelines on recycling
• IMO guidelines on recycling
• Guidelines not enough
• Need international regulation
• Need an internationally-agreed benchmark

16
Draft IMO Convention(a) Requirements for ships

• Design, construction, operation etc.
• Controls of hazardous materials
• Inventory of hazardous materials
• Preparation for recycling
• Recycling Plan
• Survey and certification

17
Draft IMO Convention (cont)(b) Requirements
for recycling facilities

• Controls on facilities
• Management Plan
• Removal of hazardous materials

(c) Reporting requirements
18
Improve facilities in recycling yards

• Standards must be internationally-
  acceptable
• Need commitment of the Asian governments
• Need commitment from industry (green
  passport, gas-freeing etc.)
• Need enforcement by flag states
• But also commitment from other states?

19
Designate approved recycling yards

• Need approval system, based on
  internationally-agreed standards
• Need licensing arrangements

20
Get shipbuilders involved

• Green passport in standard format
• Think disposal

21
In summary

• The South Asian yards are needed, both by
  the shipping industry and by the local
  economies
• Conditions have to be improved
• Need IMO Convention
• Need approved facilities

22
Thank you