News & Views.

Effective end of May, the China – Middle East Gulf ‘CMI’/’WAX’service jointly operated by MOL and APL (#195) will drop one of its two Bahrain calls and add an additional call at the UAE hub of Jebel Ali. So far, the loop included an unusual double call in the order of Bahrain, Dammam, Bahrain. Instead, […]

2013, Week 20 – from May 12 to May 18 Network news Zim takes slots on ‘IFX’ Evergreen takes slots on ‘NHX’ ANL joins Coscon on China – Australia ‘SAS’ - update MOL and PIL team-up in Indian Ocean – update TS Line’s new Australian set-up K-Line adds China – Korea shuttles ANL joins Coscon on […]

The port of Piraeus will be equipped with five of the most modern cranes in the world, significantly upgrading the port’s facilities and boosting its productivity, a Cosco representative said Friday.

Tasos Vamvakidis, commercial manager of Cosco, told the Athens News Agency that the the installation of the new cranes will allow Cosco to begin operating Pier III of the port sooner than expected. The first five cranes of the super-post panamax type arrived on Friday with the “Zhenhua 24″ vessel from Shanghai, while another two similar cranes are expected soon. The port will be able to service vessels up to 360 metres in length and around 4,000 container boxes in 24 hours. The lifting ability of the new cranes is 65-85 tons, while each crane weighs around 2,000 tons.

We want to raise our productivity, Vamvakidis said, adding that with the operation of piers 2 and 3, the port will be able to manage around 4.3 million container boxes by the end of 2013.

Cosco handled around 3,911,674 container boxes in 4,191 ships in the period 2010-2012, while in the first quarter of 2013 it handled 535,000 containers. Cosco estimates that in the next two years the handling of container boxes will total 4.7 millon TEU from 2,108,087 in 2012.

The Chinese company employs around 1,000 Greek workers and operates four terminals in Pier II.

Euroseas Ltd. (NASDAQ: ESEA), an owner and operator of drybulk and container carrier vessels and provider of seaborne transportation for drybulk and containerized cargoes, announced today its results for the three month period ended March 31, 2013.

First Quarter 2013 Highlights:
•Net loss of $4.6 million or $0.10 loss per share basic and diluted on total net revenues of $10.9 million. Adjusted net loss¹ for the period was the same.
•Adjusted EBITDA ¹ was $(0.1) million.
•An average of 15.00 vessels were owned and operated during the first quarter of 2013 earning an average time charter equivalent rate of $8,718 per day.
•Declared a quarterly dividend of $0.015 per share for the first quarter of 2013 payable on June 14, 2013 to shareholders of record on June 5, 2013. This is the thirty-first consecutive quarterly dividend declared.

¹ Adjusted EBITDA, Adjusted net loss and Adjusted loss per share are not recognized measurements under GAAP. Refer to a subsequent section of the Press Release for the definitions and reconciliation of these measurements to the most directly comparable financial measures calculated and presented in accordance with U.S. GAAP.

Aristides Pittas, Chairman and CEO of Euroseas commented: “During the first four months of 2013, both drybulk and containership markets appeared to be bottoming out. Renewal rates were just slightly higher than fixtures that were made during the last six months; however for expiring charters that had been concluded more than six months ago (mostly our drybulk vessels) renewal rates were lower than the previous ones. We do not see any significant improvement in the near term as deliveries of new vessels are to continue at a high rate eclipsing any demand growth. The current market information for supply and demand trends seems to indicate that in all likelihood a meaningful charter market recovery will have to wait the coming of 2014. Our chartering strategy is focused on keeping our vessels employed ideally with charters of short duration so our vessels could take advantage of any market recovery.

“On the investment front, the depressed charter market is starting to suggest that attractive investment opportunities for both sectors can be made as ship values appear to be bottoming out too. We continue to evaluate such opportunities and we intend to soon acquire additional vessels whilst possibly selling some of our older ships. During the first quarter, we invested our remaining capital commitment of $6.25 million in Euromar, our joint venture with two private equity firms. Euromar has a young fleet of ten large feeder vessels and is in a position to expand further by acquiring 2-4 vessels worth $30-35 million, thus, benefiting from the current state of the containership market and the expected recovery.

“Faithful to our strategy of paying meaningful dividends, our Board decided to continue paying a dividend of $0.015 per share which represents a yield of about 5.4% on the basis of our stock price on May 15, 2013.”

Tasos Aslidis, Chief Financial Officer of Euroseas commented: “The results of the first quarter of 2013 primarily reflect depressed state of the markets and the drydocking expenses that we incurred for the drydocking of 3 of our vessels. If we compare our results for the first quarter of 2013 with the same period of 2012, our net revenues declined by about $3 million and we incurred an additional $1.8 million of drydocking expenses for a total of $4.8 million difference, or about $0.11/ share,which explains the difference in the results between the two periods.

“Total daily vessel operating expenses, including management fees and general and administrative (“G&A”) expenses increased by 4.7% on a per vessel per day basis during the first quarter of 2013 as compared to the first quarter of 2012. This increase mainly reflects higher running expenses and higher G&A expenses per vessel because our fleet was reduced by about one vessel during the first quarter of 2013 as compared to the first quarter of 2012. Our drydocking expenses in the first quarter of 2013 were $1,343/day on a per vessel per day basis, a level that was significantly higher as compared to the $22/day for same period of 2012. We believe that we continue to maintain one of the lowest operating cost structures amongst the public shipping companies which, we believe, is one of our competitive advantages.

“As of March 31, 2013, our outstanding debt is about $59.5 million versus restricted and unrestricted cash of about $35.9 million. We were in compliance with all our loan covenants.”

First Quarter 2013 Results:
For the first quarter of 2013, the Company reported total net revenues of $10.9 million representing a 21.7% decrease over total net revenues of $13.9 million during the first quarter of 2012. The Company reported losses for the period of $4.6 million as compared to a net loss of $9.0 million for the first quarter of 2012. The results for the first quarter of 2013 include a $0.5 million unrealized gain on derivatives as compared to $0.2 million unrealized gain on derivatives and trading securities for the same period of 2012; and a $0.4 million realized loss on derivatives compared to a $0.4 million realized loss in the same period of 2012. Drydocking expenses of $1.8 million during the quarter were higher than the $0.03 million incurred in the first quarter of 2012 and refer to expenses for three of our vessels drydocked in the first quarter of 2013. Depreciation expense for the first quarter of 2013 was $4.3 million compared to $4.5 million during the same period of 2012. On average, 15.00 vessels were owned and operated during the first quarter of 2013 earning an average time charter equivalent rate of $8,718 per day compared to 15.92 vessels in the same period of 2012 earning on average $11,258 per day.

Adjusted EBITDA for the first quarter of 2013 was $(0.1) million, a 101.5% decrease from $4.9 million achieved during the first quarter of 2012. Please see below for Adjusted EBITDA reconciliation to net loss and cash flow provided by operating activities.

Basic and diluted loss per share for the first quarter of 2013 was $0.10, calculated on 45,319,605 weighted average number of shares outstanding compared to basic and diluted loss per share of $0.28 for the first quarter of 2012, calculated on 31,910,518 weighted average number of shares outstanding.

Excluding the effect on the loss for the quarter of the unrealized gain and realized losses on derivatives, the adjusted loss per share for the quarter ended March 31, 2013 would have remained the same at $0.10 per share basic and diluted, compared to the loss, for the quarter ended March 31, 2012 of $0.00 per share basic and diluted. Usually, security analysts do not include the above items in their published estimates of earnings per share.

XRTC Business Consultants, Financial Advisor of China Development Bank in shipping finance, announces the signing of the loan agreement between China Development Bank and Paragon Shipping Inc. took place on May, 17th 2013 in Beijing during the auspices of Greek Prime Minister’s Antonis Samaras official visit in China, who was accompanied by a large Greek business delegation.

The new loan facility is related to the “Hellenic-Maritime Financial Scheme» (Sino-Greek Shipping Finance Special Scheme) of US$ 5bn.

The loan amount is US$ 69m and provides partial funding to the construction of two (2) container vessels of 4,800 TEU (H656 and H657) each; in Zhejiang Ouhua Shipbuilding Co belong to Paragon Shipping Inc. and expected to be delivered during 2014. The vessels will have a dual class of Germanischer Lloyd and China Classification Society.

Lead Arranger of the loan facility is China Development Bank (CDB) while XRTC acted as Project Advisor and Communication Agent and Norton Rose contributed in the successful outcome of the project.

The signing ceremony was organized by China Development Bank in the new premises of its headquarters in Beijing. On behalf of the borrowers’ companies Mr. Michael Bodouroglou attended the ceremony, while on behalf of the CDB, Messrs. Zhao Yaozhong-Governor CDB / Ningxia, Tian Wendong, Deputy General Manager-Global Cooperation Department, Gu An, Deputy Chief of Ship Finance Center, Ke Changwei, Deputy General Manager CDB / Ningxia, Yu Jundang, Director-Division I, Ship Finance Center and Zhao Hui from the Global Cooperation Department of Ningxia Branch. Mr. George Xiradakis, Managing Director in XRTC Business Consultants and Mr Nigel Ward, Partner in Norton Rose attended the signing as well.

Both of the signing parties strongly believe that the conclusion of this shipping transaction guarantees a long-term relationship between them.

Mr. Bodouroglou, in his speech, expressed his gratitude to the bank for its support to his group of companies and wished to develop further their cooperation in the investments plans in the near future. He specifically stated that “The current period of downturn across the shipping sectors, may provide new opportunities to the investors, while the low newbuilding prices could affect positively the development and modernization of the fleet”. CDB representatives’ assured that their bank has keen interest and wishes to support further Mr. Bodouroglou’s group of companies, Paragon Shipping, Boxships and AllSeas, but they also confirmed the bank’s strategy to carry on developing its activities in Greek Shipping.

Fri May 17, 2013 10:06am EDT (Adds quotes, details, background) By
Lada Evgrashina May 17 (Reuters) – Azeri state energy firm SOCAR plans to borrow about $4 billion from foreign banks to finance construction of a refinery in Turkey, an company official said, a project that could provide a profitable outlet for its crude.”According to a financing scheme, 65 percent of financing of the Star refinery will be provided by bank credits, while the remaining 35 percent (will come) from Azerbaijan’s own resources, mainly the state oil fund,” SOCAR Vice President Suleiman Gasymov said.Turkey currently imports most of its oil products. Its sole refiner, Tupras, already buys some Azeri crude as some of the 28 million tonnes of oil it processes annually at four plants.The refinery at Aliaga in western Turkey is planned to produce annually 500,000 tonnes of jet fuel, 6 million tonnes of diesel, 500,000 tonnes of petroleum coke, 300,000 tonnes of liquefied petroleum gas and 1.6 million tonnes of naphtha.Gasymov said SOCAR would sign an EPC (engineering, procurement and construction) contract with a consortium of foreign companies this month.”The EPC contract on construction of the Star refinery with a capacity of 10 million tonnes of oil a year is expected to be signed within days,” he said.”Conditions of the project will be presented to creditors after that.”Total construction costs are estimated at $5 billion to $6 billion. It is expected to be completed by 2016.SOCAR, which controls Turkish petrochemical giant Petkim, owns 81.5 percent of the project, while Turkey’s Turcas Petrol owns the remaining 18.5 percent.In December 2012, SOCAR selected a consortium of Tecnicas Reunidas, Saipem, GS Engineering & Construction and Itochu to build the refinery on the Aegean coast.Gasymov said the European Bank for Reconstruction and Development, the World Bank and some foreign commercial banks had expressed interest in funding the project. (Writing by Margarita Antidze; editing by Jane Baird)

Fri May 17, 2013 9:30am EDT (John Kemp is a Reuters market analyst. The views expressed are his own) By
John Kemp May 17 (Reuters) – Budgets are made to be broken – especially when they are written by politicians.Unfortunately it seems the world is on course to break the carbon budget that scientists and policymakers agree is necessary to limit the rise in global temperatures to less than 2 degrees Celsius.If governments were really committed to limiting the rise in temperatures to 2 degrees, two-thirds of the currently known oil, coal and gas reserves would have to be left in the ground, according to the International Energy Agency (IEA).But it is not clear anyone is taking the target seriously. In the last 12 months, the top 200 oil, gas and mining companies allocated up to $674 billion to finding and developing even more reserves, according to the Climate Tracker Initiative.The shares of petroleum and mining companies listed on New York, London and other stock exchanges value them as if all these resources will be extracted and burned.There is a “gross inconsistency between current valuations for fossil fuel assets and the path governments have committed to take”, according to Nicholas Stern, a leading adviser to Britain’s government on the economics of climate change.TOTAL CARBON BUDGETIn 2010, countries in the United Nations Framework Convention on Climate Change confirmed their intention to limit emissions of greenhouse gases to hold the rise in average temperatures to less than 2 degrees above pre-industrial levels.(Cancun Agreements, 1/CP.16 I 4)Two degrees is “considered the threshold for preventing dangerous anthropogenic interference with the climate system”, the IEA wrote in its “2012 World Energy Outlook”.Limiting warming to 2 degrees with a probability of 50 percent implies the atmospheric concentration of greenhouse gases must be stabilised at about 450 parts per million of carbon dioxide (CO2) equivalent, according to the IEA and scientific advisers on the Intergovernmental Panel on Climate Change (IPCC).The 450 parts per million target implies there is a maximum amount of carbon dioxide that can be emitted and of fossil fuels that can be burned – something both policymakers and climate campaigners have termed the global “carbon budget”.”Carbon dioxide emissions from fossil fuels and land-use change in the first half of this century must be kept below 1,440 billion tonnes of CO2 equivalent,” according to the IEA.”Since a total of 420 billion tonnes of CO2 have already been emitted between 2000 and 2011, and we estimate that 136 billion tonnes will be emitted from non-energy related sources in the period up to 2050, a maximum of 884 billion tonnes can be emitted by the energy sector from 2012 to 2050,” the IEA concluded.Climate campaigners have come up with similar estimates. “The available budget is 900 billion tonnes of CO2 for an 80 percent probability to stay below 2 degrees and 1,075 billion tonnes for a 50 percent probability,” according to the Carbon Tracker Initiative’s report “Unburnable Carbon 2013: wasted capital and stranded assets”.Given the substantial amount of uncertainty surrounding the measurement of emissions and their precise impact on temperatures, it is safe to assume the carbon budget is around 1,000 billion tonnes of CO2 equivalent between now and 2050.Energy-related CO2 emissions were just over 31 billion tonnes in 2011 and rising, IEA figures show.COOKING THE PLANETThere are more than enough fossil fuels to cook the planet many times over. Current proven and probable reserves of oil, gas and coal (resources which have been found and are estimated with a probability of more than 90 percent and 50 percent respectively) would emit the equivalent of 2,860 billion tonnes of CO2 if they are all burned, according to the IEA.”More than two-thirds of current … fossil fuel reserves cannot be commercialized in a 2 degree world before 2050,” IEA cautions.Nicholas Stern explains in a forward to the “Unburnable carbon 2013″ report: “If we burn all current reserves of fossil fuels, we will emit enough CO2 to create a prehistoric climate, with Earth’s temperature elevated to levels not experienced for millions of years.”Smart investors can already see that most fossil fuel reserves are essentially unburnable … They can see that investing in companies solely or heavily relying on constantly replenishing reserves of fossil fuels is becoming a very risky decision,” Stern claims.The facts suggest otherwise. “The markets appear unable to factor in the long-term shift to a low-carbon economy into valuations and capital allocation,” the Climate Tracker Initiative admits. “Capital needs to be redirected away from high-carbon options.”"The bulk of (the $674 billion investment) was derived from retaining earnings – pointing to the duty of shareholders to exercise stewardship over these funds so they are deployed on financially gainful opportunities consistent with climate security.”The current balance between funds being returned to shareholders, capital invested in low-carbon opportunities and capital used to develop more reserves needs to change,” Climate Tracker Initiative argues.INVESTMENT BOYCOTT”Unburnable carbon 2013″ sets out recommendations for finance ministers, regulators, actuaries, advisers and investors to help force a re-evaluation of the risks of investing in more fossil fuel production and to push capital towards lower-carbon alternatives.Bill McKibbin’s 350.org is mobilising a grass-roots campaign to convince pension funds investing on behalf of state, municipal and college employees in the United States to divest their holdings in fossil fuel companies. The aim is to force change by organising an investment boycott similar to those mounted against South Africa during apartheid, and more recently against Iran.350.org demands fossil fuel companies stop exploring for new hydrocarbons, stop lobbying in Washington and state capitols, and “pledge to keep 80 percent of their current reserves underground forever”.IS ANYONE LISTENING?So far, the concepts of a carbon budget and of a maximum amount of fossil fuels that can be burned have not got much traction with policymakers, corporations or the public.Earlier this month, the average daily concentration of greenhouse gases measured at the Mauna Loa Observatory in Hawaii passed 400 parts per million. It is rising at about 2 parts per million every year, yet the milestone generated comparatively little comment and relative indifference from the public and officials.Voters and politicians seem unconvinced that the 450 ppm target can or should be achieved.”Collectively, humanity has yawned and decided to let the dangers mount,” columnist Martin Wolf observed in the Financial Times on Monday (“Why the world faces climate chaos” May 15).”We will watch the rise in greenhouse gases until it is too late to do anything about it,” he concludedWolf went on to explain the seven reasons for inaction and speculate on what would be necessary to spark a real effort to change.Apocalyptic warnings about the dangers will not work, he said. If action is required, they must be replaced by a much more positive vision of a prosperous and low-carbon future.In the meantime, “there is no political will to do anything real about the process driving our experiment with the climate. Yes there is talk and wringing of hands. But there is, predictably, no effective action,” he notes sadly.Campaigners such as 350.org and the Climate Tracker Initiative hope to change that indifference by pushing the issue back up the agenda.Investors and fossil fuel companies are gambling that they will not succeed, and politicians are not serious about enforcing a combustion cap. (editing by Jane Baird)

ZUG, Switzerland | Fri May 17, 2013 12:44pm EDT May 17 (Reuters) – Transocean Ltd said shareholders voted out Chairman Michael Talbert at the annual meeting on Friday and backed a nominee of activist investor Carl Icahn to replace him on the board of the world’s largest offshore drilling contractor. The company told the meeting in Zug, Switzerland, that shareholders also voted in favor of the board-proposed dividend of $2.24 per share, while rejecting a $4-per-share payout proposed by Icahn.Icahn, after disclosing a 5.6 percent stake in Transocean in January, set out on a campaign to shake up the board and extract a higher dividend. Transocean had called his proposed dividend “unsustainable” and offered $2.24 per share in response.Transocean said earlier this week that Talbert would step down later this year.

Fri May 17, 2013 1:38pm EDT (Adds details on import levels) May 17 (Reuters) – Turkish Prime Minister Tayyip Erdogan said on Friday Turkey had already significantly reduced its oil imports from Iran, which is under the choke of Western sanctions, and further cutbacks would depend on his country’s energy needs.”On crude oil, there has been a significant decrease in the amount of oil we import from Iran … As to whether we would cut back any further, it will depend on our need. Time will tell,” Erdogan said at the Brookings Institution in Washington.Last year, Ankara effectively halved imports of Iranian oil after a European Union oil embargo against Iran came into full force on July 1, which also targeted the marine insurance sector, cutting off the usual avenues for tanker insurance.Turkey was twice granted a waiver on Iranian oil by the United States for 180 days after it made initial cuts.Turkish imports of Iranian crude were steady in April at around 100,000 barrels per day, data from a well-informed shipping agent in the region showed two weeks ago.Before the introduction of stricter U.S. and EU sanctions against Iran last year, imposed over Tehran’s disputed nuclear program, Ankara’s purchases were averaging 180,000 bpd.Turkey nonetheless remains one of the largest customers for Iranian oil together with Asian buyers such as China, India, South Korea and Japan. (Reporting by Nick Tattersall; Editing by Doina Chiacu)

WASHINGTON | Fri May 17, 2013 1:14pm EDT May 17 (Reuters) – Turkish Prime Minister Tayyip Erdogan said on Friday Turkey had already significantly reduced its oil imports from Iran, which is under the choke of U.S. sanctions, and further cutbacks would depend on his country’s energy needs. “On crude oil, there has been a significant decrease in the amount of oil we import from Iran … As to whether we would cut back any further, it will depend on our need. Time will tell,” Erdogan said at the Brookings Institution in Washington.(Reporting by Nick Tattersall; Editing by Doina Chiacu)