INTERTANKO Some Technical &Regulatory Activities Latin American Panel 25 April 2006, Rio de Janeiro

Summary of the Presentation 1.Engine Room Waste Treatment Associate Systems 2.Fixed Hydrocarbon Gas Detection Systems in DH Tankers 3.Hot Work Onboard FPSOs - 3.Hot Work Onboard FPSOs - An Alternative to ISGOTT... If time permits 4. Updates from IMO: a. Air emissions; b. STS Transfer in MARPOL; c. Coating – Performance Standard

Engine Room Waste Treatment Associate Systems (ERWTAS) Latin American Panel 25 April 2006, Rio de Janeiro

Background Alarming results from the USCG and other PSC MoUs campaigns to control ships’ bilge water discharges Alarming results from the USCG and other PSC MoUs campaigns to control ships’ bilge water discharges Ship engineers and master convicted for “criminal violation and deliberate and knowing conduct” – since 1998, 18 years cumulative prison sentences in US Ship engineers and master convicted for “criminal violation and deliberate and knowing conduct” – since 1998, 18 years cumulative prison sentences in US Prosecution against shipping companies – since 1998, cumulative $133 million in fines in US Prosecution against shipping companies – since 1998, cumulative $133 million in fines in US All types of vessels involved All types of vessels involved Prosecutions for: bypassing the OWS/OCM, flushing the OCM with fresh water, false logging / fake ORB, etc. Prosecutions for: bypassing the OWS/OCM, flushing the OCM with fresh water, false logging / fake ORB, etc.

INTERTANKO Action ISTEC identified need for two step approaches: – software - Guide for correct entries into the ORB – hardware – a guide for best practices for design & operations ER ORB – entry errors and omissions – Section C is for fuel sludge not for discharge at sea but for incineration or delivery to reception facilities – Section D for bilge water collection, treatment and discharge through the 15ppm system ER ORB - d ifficulty to understand the terminology – “non-automatic discharge overboard or disposal otherwise of bilge water which has accumulated in machinery spaces” (meaning accumulated in bilge water holding tank) – leads to wrong logging into section C instead of section D – ”discharge” or ”transfer”

ERWTAS Scope of the Guide A critical review of the current systems for treatment of engine room wastes A critical review of the current systems for treatment of engine room wastes Promote performance standards for enhanced onboard procedures and operations Promote performance standards for enhanced onboard procedures and operations Innovative arrangements to improve the efficiency of these systems Innovative arrangements to improve the efficiency of these systems Possible changes to relevant MARPOL regulations Possible changes to relevant MARPOL regulations Advise for compliance procedural approaches Advise for compliance procedural approaches Reference manual for crew training Reference manual for crew training

Recent developments in IMO IMO considers a proposal to modify the current MEPC Circular 235 for the design of an Integrated Bilge Water Treatment System (IBTS). IBTS suggests for segregation of oil sludge, oil- water mixture and clean water holding systems; proposal limits the amount of oily water needed to be treated by the separation system before discharge to the sea INTERTANKO agrees with this as basic line but the Guide will go beyond it

Recent developments in IMO Previously: IMO resolution MEPC.60(33) - bilge water separators to be tested with a mixture of oil and water After January 1, 2005: IMO Resolution MEPC.107(49): – bilge water separators to be tested also with a stable emulsion – oil-in-water monitor to include a recording function for date, time, alarm and operating status. The recording of the operation to be stored for 18 month

General Issues Current onboard waste treatment systems not fit for purpose Current onboard waste treatment systems not fit for purpose Design assumptions inadequate Design assumptions inadequate No hollisitc concept of waste treatment management No hollisitc concept of waste treatment management Lack of standardisation of the equipment provided to ships Lack of standardisation of the equipment provided to ships Unclear guidelines for logging Unclear guidelines for logging

ERWTAS ERWTAS Principles for efficient waste treatment KNOW-HOW: Oily waste chemistry KNOW-HOW: Oily waste management Process design Upstream and downstream conditions Understanding of how emulsions form and break down Selection of chemicals Manufacturers Designers/Ship Operators

Waste content Waste content: Waste content: – droplets of emulsified water/oil & – ultra-fine suspended solids Waste content: Waste content: – oil – water (50%-90%) – chemicals – detergents – soot – grease – etc. Three-phase separation is the key

Solutions Solutions Minimise the amount of generated waste (design and housekeeping solutions) Minimise the amount of generated waste (design and housekeeping solutions) Prevent unnecessary mixture of oil, water, chemicals, etc. (design solution) Prevent unnecessary mixture of oil, water, chemicals, etc. (design solution) Standardising the design of the waste treatment installation and of the equipment (regulatory solution): Standardising the design of the waste treatment installation and of the equipment (regulatory solution): – Capacity and number of sluge/bilge water tanks – Location and design of the sludge/bilge water tanks – Adequate drain piping and drain collection – Onboard incinerator capacity Transfer of sludge to slop tanks ? Transfer of sludge to slop tanks ? Capacity of Incineraotrs Capacity of Incineraotrs

Tank design and management For bilge water and oily sludge/slop/waste oil Settling tank Settled tank Oil skimming Sludge drain To treatment Heat

Housekeeping Fuel tank Fuel oil sludge Boiler Incinerator Ashore Lube oil sludge Treatment Overboard Recycle? Heavily polluted water Condensate etc. Treatment Chemicals - QSDs - Additives - Effectiveness?

Concentrated solids Reduced chemical usage Performance-driven development Focus on “back- end” processes Closed loops, re- utilisation & self- containment Minimised leakages Reduced oil losses Reduced water consumption Process vision Equipment vision Wasteminimisation

Procedures and Policies INTERTANKO Chairman There is a needs of some kind of an audit system or procedure to ensure that in fact crews are complying. While such an audit scheme does not have to audit every vessel all the time, there clearly is a need based upon what we hear from DOJ in the US, and what we are seeing elsewhere, to have some method of occasional checking on what is happening in practice aboard the ships. I think it is imperative for INTERTANKO to set a good example here and require some sort of an operational audit of environmental practices, AND, I think it is imperative for P&I Clubs to require the same.

Procedures and Policies Procedures and Policies State and display clear environmental policies State and display clear environmental policies Incentives for employees’ compliance and measures to enhance safety and environmental procedures Incentives for employees’ compliance and measures to enhance safety and environmental procedures Zero tolerance for violations from the rules or lack of reporting of problems Zero tolerance for violations from the rules or lack of reporting of problems Enhance ORB procedures – use the INTERTANKO Guide for correct entries as a reference manual Enhance ORB procedures – use the INTERTANKO Guide for correct entries as a reference manual Enhance onboard training/familiarisation procedures Enhance onboard training/familiarisation procedures Establish clear handover templates Establish clear handover templates Seals and tags for overboard lines and flanges Seals and tags for overboard lines and flanges Install lock boxes on monitoring equipment and interlocks to prevent tricking of monitoring equipment Install lock boxes on monitoring equipment and interlocks to prevent tricking of monitoring equipment Internal and external onboard audits Management/audit Internal and external onboard audits Management/audit

Conclusions “New thinking” in the engine room Waste-efficient equipment and solutions, including configuration and size of bilge water tank, sludge tanks and incinerators Integrated process approach to the ER Standardisation of equipment and automation Training of seafarers Adequate ship procedures and policies

Some results from field testing Results well below 15 ppm, normally < 5 ppm Chemicals not needed Separation temperatures of °C feed effluent

Fixed Hydrocarbon Gas Detection Systems in DH Tankers Latin American Panel 25 April 2006, Rio de Janeiro

BACKGROUND DH structure on tankers > 5,000 dwt DH structure on tankers > 5,000 dwt Increased protection against accidental pollution Increased protection against accidental pollution Introducing operational and safety challenges Introducing operational and safety challenges DH tankers designed to stay intact but DH tankers designed to stay intact but Complex structure to be inspected & maintained Complex structure to be inspected & maintained Corrosive cargoes and atmosphere may lead to Corrosive cargoes and atmosphere may lead to Mechanical or fatigue damage/cracks and Mechanical or fatigue damage/cracks and Risk of cargo “migration” from cargo tanks into double hull void spaces Risk of cargo “migration” from cargo tanks into double hull void spaces

BACKGROUND DH tankers are safe but a second layer of defence against cargo migration is needed DH tankers are safe but a second layer of defence against cargo migration is needed Mitigation alternatives: Mitigation alternatives: – permanent inert atmosphere on empty tanks or – means of effcient hydrocarbon gas detection EMSA Panel on DH Tankers identified this concern and recommended mandatory requirement for the latter alternative EMSA Panel on DH Tankers identified this concern and recommended mandatory requirement for the latter alternative

ACTION PLAN INTERTANKO involved and took the lead INTERTANKO involved and took the lead INTERTANKO drafted new SOLAS regulation INTERTANKO drafted new SOLAS regulation Draft sent to IACS Draft sent to IACS IACS/INTERTANKO to jointly finalise the new regulation IACS/INTERTANKO to jointly finalise the new regulation EMSA kept informed and in agreement to let the industry do the job EMSA kept informed and in agreement to let the industry do the job SOLAS regulation to be presented to IMO in Dec. 2006, earliest date to come into force, July 2009/January 2010 SOLAS regulation to be presented to IMO in Dec. 2006, earliest date to come into force, July 2009/January 2010

THE PROPOSED REGULATION Application: all tankers [5,000]/[20,000] dwt and above built on or after [??] Application: all tankers [5,000]/[20,000] dwt and above built on or after [??] New tankers below [5,000]/[20,000] dwt to comply with current SOLAS II-2/ (portable instruments and fixed pipe system for emergency inerting) New tankers below [5,000]/[20,000] dwt to comply with current SOLAS II-2/ (portable instruments and fixed pipe system for emergency inerting) Exemption from the rule: DH tankers with constant operative inerting system Exemption from the rule: DH tankers with constant operative inerting system Existing DH tankers: Existing DH tankers: – Equivalent systems: existing fixed gas detection systems and existing operative systems for permanent inerting – Retrofitting DH tankers if none of such systems is onboard IMO to develop Technical Specifications for new gas fixed systems (as suggetsed by INTERTANKO/IACS) IMO to develop Technical Specifications for new gas fixed systems (as suggetsed by INTERTANKO/IACS) Type approval for equipment/installation Type approval for equipment/installation

TECHNICAL SPECIFICATIONS Istallation: Istallation: – central unit for gas measurement and analysis located in a safe area (e.g. cargo control room, navigation bridge, etc.) – gas sampling pipes in all ballast tanks and void spaces adjacent to cargo tanks, including the forepeak tank Sampling points: Sampling points: – 2/space for tankers >[50,000] dwt (upper point at [1-2] m from the top and lower point at [1-2] m (min. 0.5 m) from the bottom) – DB ballast tanks only: no requirement for upper sampling point Sampling and gas analysis every 30 minutes Sampling and gas analysis every 30 minutes Alarms for gas leakage and for clogged sampling pipes Alarms for gas leakage and for clogged sampling pipes Design for: Design for: – easy testing and calibration – permitting use of portable instruments

Hot Work Onboard FPSOs Hot Work Onboard FPSOs An Alternative to ISGOTT Latin American Panel 25 April 2006, Rio de Janeiro

Background Life maintenance of FPSO’s and FSO’s involves steel renewals and modifications within enclosed vessels and tanks Currently there are no specific industry guidelines addressing the associated hot work issues for FPSO’s The closest and most frequently referenced guidelines are the “International Safety Guide for Oil Tankers & Terminals”, (ISGOTT)

Background ISGOTT guidelines written for tankers, and found consistently impractical to apply to a producing FPSO Impractical to treat FPSO’s and FSU’s as tankers; steel plates must be changed-out on station, whilst producing, rather than during a ballast voyage or in dry dock There is a need for the industry to develop an alternative approach, specific to FPSO’s

ISGOTT requirements The fundamental problem arises from the ISGOTT requirement that “Adjacent cargo tanks, including diagonally positioned cargo tanks, should either have been cleaned and gas freed to hot work standard, or cleaned and hydrocarbon vapour content reduced to not more than 1% by volume and kept inerted, or completely filled with water.”

ISGOTT requirements Consequence of reduced storage – smaller offload parcels, split offloads or dead freight

An alternative to ISGOTT for FPSO’s Hotwork on any FPSO conducted in accordance with an industry Guide/Code of Practice Code of Practice may result in certain deviations from ISGOTT, but also the implementation of additional safety precautions Code of Practice to be based on many years of cumulative operating experience Code of Practice may suggest that no hot work takes place within 500mm (or exceptionally 250mm) of a live bulkhead (250mm has been verified by heat transfer tests as acceptable with respect to heat transfer)

An alternative to ISGOTT for FPSO’s Case 1: Hotwork within tank at a distance of more than 500 mm from a boundary bulkhead

An alternative to ISGOTT for FPSO’s Case 2: Hot work in tank working within 250mm of a boundary bulkhead.

An alternative to ISGOTT for FPSO’s Tanks may be put in a safe condition in a number of ways: cleaned and prepared as per hot work tank, (cases where hot work is needed in both tanks) cleaned, ballasted to a height of 2m above the location of the hot work, and inerted crude oil washed, water washed, and inerted with clean IG

An alternative to ISGOTT for FPSO’s

HW on a Common Bulkhead reverse side thoroughly cleaned and tank ballasted to above work area adjacent tank COW’d, water washed & inerted with clean IG. 0 2 in adjacent tank less than 5% purging in adjacent tank to reduce HC content to less than 1% by volume.

An alternative to ISGOTT for FPSO’s Additional requirements to ISGOTT include: Specific hotwork procedures are developed onboard by Unit Superintendent, Safety Officer and Cargo Supt. The procedure is reviewed onboard by risk assessment. If the risk level is determined as High, further safeguards must be introduced to reduce the risk to Medium or Low. Independent HW Safety Officer is present. All procedures are then reviewed and approved by the Shore Base Manager, and in the Production Management Office.

An alternative to ISGOTT for FPSO’s

All hotwork requires a Permit to Work An independent safety officer, reporting to the Unit Superintendent, is present during the work execution Tank setup (lighting, access and ventilation) is a significant factor in the safe implementation of repair procedures

Future additional issues  Refinement of local cleaning definition to cover such things as rope access welding.  Procedures and facilities to cover working within 250mm of a live bulkhead.

Conclusions It has been found consistently impractical to fully apply ISGOTT to producing FPSO’s Hot work procedures on FPSO’s need to be specific to the work being performed. Risk assessment is an effective tool to assess the suitability of procedures. There needs to be a dialogue in the industry, and a sharing of experience

Conclusions INTERTANKO Offshore Tanker Committee (IOTC) agreed to develop an industry guide for HW procedures on FPSOs Link with OCIMF for further cooperation Approach towards UKOOA and OLF (Norwegian Oil Industry Association) for coordination Inviting interested members to contribute to the drafting process and support the recognition of such an industry guide by authorities in countries with offshore activities

Updates from IMO Air emissions; STS Transfer in MARPOL; Coating – Performance Standards Latin American Panel 25 April 2006, Rio de Janeiro

Air Emissions Revision of MARPOL Annex VI – 2008/2010 SOx – lower limits (global & SECAs); more SECAs; scrubbers; emission trading; NOx – lower limits; different measures on 2-stroke, 4-stroke large and 4-stroke smaller engines; existing tankers; two- step approach (2010/2014) VOC emissions – loading (equipment); in-transit (VOCON) Particulate Matter – concern but lack of clear definition Cold Ironing Two correspondence groups Inter-sessional meeting in Norway (November 2006)

SOx emissions – MDO only? CIMAC Guide

SOx emissions – MDO only? Should INTERTANKO suggest it? CIMAC Guide ? ?

STS Transfer – MARPOL regulation (?) Proposal by Spain and Mexico To mandate reporting 24 hrs. in advance of any STS operations to the nearest Coastal State (no matter ships in international waters) –Name, flag, call sign and IMO No. of the ship; –Date, time and geographical location of the planned transfer or supply of fuel; –Fuel type and quantity; –Planned duration of operation; –Name, flag and call sign of the other ship involved in the operation; –Type of fendering; –Request for a pilot if necessary.

STS Transfer – MARPOL regulation (?) Both ships to keep permanent contact with the ”national point of contact” during the operation and comply with instructions given to them Prior to commencing operations both ships to sign ” their joint satisfaction the checklist” Regulation 44 - Powers of the coastal State - The coastal State off whose shores an oil-transfer or fuel-supply operation between two ships is taking place shall adopt such measures as it considers reasonable in order to safeguard its interests, and may even refuse to authorize such an operation if, in the judgement of the competent authorities, there arises a situation that is clearly dangerous. No STS operations in Special Areas and PSSAs.

STS Transfer – MARPOL regulation (?) Controversial and highly political issue All South American Countries provided support to Spain/Mexico IMO Correspondence Group requested to: –develop draft regulation as new Chapter 8 of the revised MARPOL Annex I –explore if additional generic requirements are necessary for special areas and PSSA's taking into account BLG’s decision that a total ban is considered inappropriate –consider whether different requirements should apply to STS bunkering operations –further consider the advantages and disadvantages of including FPSO's and FSU's

STS Transfer – MARPOL regulation (?) INTERTANKO views Understanding the concept and intent However, one should first demonstrate a compelling need to instigate such regulations Concern that bunkering operations and STS operations appeared to be regarded as effectively the same operation within the proposals; they are different and they should not necessarily be covered by the same requirements Requested that the question of banning STS operations in MARPOL special areas and/or PSSA's needed careful consideration and should be reviewed by the IMO Legal Committee There is an associated risk that such regulations could force these operations further offshore and subject vessels to worse sea conditions and potentially greater risks. Advice and strong support from LAP are needed.

Coating – Performance Standards Mandatory requirements for coating of ballast tanks in all ships Separate standard for Void Spaces – IMO correspondence group Mandate coating on COTs (top and bottom) – EMSA Panel on DH Tankers Develop performance standards for COTs – IACS/Industry Working Group