Ballast Water Management DEPUTY MANAGING DIRECTOR Latin American Panel October 31, 2012 Ballast Water Management JOSEPH ANGELO DEPUTY MANAGING DIRECTOR 1

Different regimes INTERTANKO Actions IMO Response International National/Regional Local INTERTANKO Actions IMO Response 2

IMO Ballast Water Management Convention Adopted in 2004 INTERNATIONAL IMO Ballast Water Management Convention Adopted in 2004 Entry into force requires ratification by 30 countries, 35% world’s grt Currently, 36 countries, 29.06% grt 3

BWM Plan and Record Book BWM System performance standard INTERNATIONAL BWM Plan and Record Book BWM System performance standard Compliance schedule to install BWMS Survey and certification requirements Port State Control procedures 4

NATIONAL – US Coast Guard Final regulations issued March 2012 Main requirements include: BWM plan and record keeping; BWM standard (same as IMO) with review in 4 years; Compliance schedule (similar to IMO); Acceptance of “Alternative”BWMS for 5 years 5

Regulatory schedule - IMO Year of ship construction Ballast capacity Year of ship construction Before 2009 2009-2011 2012+ > 5,000 m3 Ballast water exchange or treatment until 2016 Ballast water treatment only from 2016 Ballast water treatment only Constructed 2009 + 1,500 – 5,000 m3 Ballast water exchange or treatment until 2014. Ballast water treatment only from 2014 < ,1500 m3 Ballast water exchange or treatment until 2016. Ballast water treatment only from 2016 Erik, these are still just proposals and not legislation. Enforcement 12 months after ratification i.e. - earliest October 2012 if ratified now - Installation at first Intermediate or Periodical Survey 6

Regulatory schedule - USCG Implementation Schedule for Approved Ballast Water Management Methods Vessel’s ballast water capacity (in cubic meters) Date constructed Vessel’s compliance date New vessels All On or after Dec. 1, 2013 On Delivery Existing vessels Less than 1,500m3 Before Dec. 1, 2013 First scheduled drydocking after Jan. 1, 2016 1,500 – 5,000 m3 First scheduled drydocking after Jan. 1, 2014 Greater than 5,000m3 First scheduled dry-docking after Jan. 1, 2016 Erik, these are still just proposals and not legislation. 7

Vessel General Permit (VGP) Dec 2008 Main requirements include: NATIONAL – US EPA Vessel General Permit (VGP) Dec 2008 Main requirements include: BWM plan and record keeping; BWM exchange; Allows states to impose additional requirements; VGP required to be renewed in 5 years 8

LOCAL – New York and California BWM standard that is 100x and 1000x greater than IMO Considerable lobbying by industry coalition EPA Science Advisory Board report – standard not possible with current BWM technology Reason prevails, for the time being 9

BWM equipment not included in the Marine Equipment Directive (MED) REGIONAL – EU BWM equipment not included in the Marine Equipment Directive (MED) EU is considering amending MED to bring in the equipment required by the BWM Convention as a mandatory standard Legal amendments to MED to include BWM equipment is scheduled for October 2012 Possible “EU approval regime” could become reality in October 2013. 10

INTERTANKO Action The Key Challenges Technical – treatment equipment and approval Regulatory – BWM Convention implementation and its enforcement

Submission to IMO’s MEPC 64 (October 2012) Policy background ISTEC and Environmental Committee – March 2012 Details technical, operational and compliance challenges Council – May 2012 Recommends comprehensive paper covering the challenges and proposing solutions be sent to IMO Submission to IMO’s MEPC 64 (October 2012) Jointly with Liberia, the Marshall Islands, Panama, BIMCO, CLIA, INTERCARGO, InterManager, IPTA, NACE and WSC - submitted August 2012

IMO MEPC 64 Submission Submission covers FOUR key areas: Explains the challenges being faced for effective implementation of the BWM Convention and to provide proposals to address those challenges Submission covers FOUR key areas: Guidelines for approval of ballast water management systems (G8); Availability of Ballast Water Management Systems (BWMS); Survey and certification requirements Procedures for port State control

1. The need for revision of the Guidelines for approval of ballast water management systems (G8) to improve transparency and ensure appropriate robustness of Ballast water management systems (BWMS) Greater transparency of information on the Type Approval Certificate and its enclosures Total Rated Capacity, 60m3/hr tested but approved to 6000m3/hr Type Approval process needs to more accurately reflect real-world environment aboard Brackish and freshwater tests High sediment waters Proposals to strengthen Type Approval process To ensure that a BWMS works in practice as well as theory Reference MEPC 64/2/18 Paragraphs 5 to 11.

2. The availability of BWMS and sufficient facilities to install BWMS As the BWM Convention dates are progressively surpassed the number of ships to which the requirements apply 12 months after full ratification continually increases Ship yards and BWMS manufacturers coming under increasing pressure to install systems within the time frame (implementation schedule) Recommend discussion of ‘new’ BWMS installation dates BWM Convention cannot legally be amended until convention enters into force Problem was recognized in 2007 when limited technologies were available to meet first implementation date of 2009 IMO Assembly adopted resolution recommending acceptance by parties of delayed installation date Reference MEPC 64/2/18 Paragraphs 13 and the Japanese submission from which this table is taken.

Current Estimated Installation Schedule Dates 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Newly constructed Vessels (less than 5,000 cubic metres) 1,740 Newly constructed Vessels (greater than 5,000 cubic metres) 1,690 Existing Vessels (between 1,500 and 5,000 cubic metres) 2,500 Existing Vessels (less than 1,500 or greater than 5,000 cubic metres) 8,800 Vessels constructed from 2009 to 2011 (greater than 5,000 cubic metres) TOTAL 3,430 5,930 16,420 13,920 Reference MEPC 64/2/18 Paragraphs 13 and the Japanese submission from which this table is taken. MEPC 61/2/17 by Japan

3. Survey and certification requirements for ships constructed prior to entry into force of the BWM Convention No phase-in period for survey and certification of ships following entry into force ROs required to review and approve BWM Plans as well as survey and certify ships within 12 month period Solution provided at MEPC 63 – commence issuance of BWM Certificates prior to entry into force Proposal to issue circular in this respect to increase awareness through industry and maintain uniform implementation Reference MEPC 64/2/18 Paragraphs 18 to 20.

4. Sampling and analysis procedures for port State control purposes Urge harmonised standard operating procedure for sampling and analysis of ballast water by PSC. Coupling of Type Approval process with the enforcement process Currently the Type Approval process is separate from the PSC process so an approved BWMS may not meet the PSC analysis once installed on board. Uncertainty in the PSC sampling and analysis process key impediment to further ratification Reference MEPC 64/2/18 Paragraphs 21 to 23.

OUTCOME OF MEPC 64 Revision of the G8 Guidelines Decided not to amend the G8 guidelines (at this time), BUT agreed to develop additional guidelines on the application of the G8 guidelines which to address the issues raised in our submission 2. Availability of BWMS Established as correspondence group (lead by Japan) to develop an Assembly resolution regarding the implementation of Regulation B-3

OUTCOME OF MEPC 64 Survey and certification requirements Agreed with our proposal to issue an MEPC Circular Sampling and analysis procedures for PSC Agreed with our proposal to instruct BLG (and FSI) Subcommittee that sampling and analysis procedures for PSC should be no more stringent than what is required for type approval of BWMS

Summary “Positive” developments at MEPC 64, but more work needs to be done Members learning on a day-by-day basis Sharing of experience and information between members essential Does the BWMS work? Does it work as it was approved to work? Does it meet the discharge standards? Propose amendments to IMO’s BWM Guidelines based upon experience gained, while supporting their international and uniform approach Concluding remarks INTERTANKO, from the outset, has been committed to a global system of regulation and one that provides for the practical realities of ships trading in various biological and physical environments. The issues raised in this paper have been brought together to illustrate the challenges the tanker industry is facing in meeting the forthcoming requirements of the IMO’s BWMC. INTERTANKO’s members have undertaken extensive research that accounts for most of the details and information in this paper. Some owners have gone as far as installing systems on new buildings while others are signing contracts for installation on ships that begin construction in the near future. However, the vast majority of the membership of INTERTANKO is still undecided about the correct option for their vessels. Furthermore, the experience of and assessment undertaken by INTERTANKO’s members is very much limited to the installation of systems on new buildings. The installation of systems on existing vessels is largely considered to be technically, operationally and commercially unfeasible at this point in time.

Ballast Water Guidance Finding, installing and operating systems on tankers?

Ballast Water Guidance To assist members during selection, assessment and installation for existing and new built vessels: INTERTANKO Guidance on the Selection and Installation of Ballast Water Management Systems for Tankers Physical Installation Pumping Control – system approval and certification Treatment type Operating practicalities Released January 2012

Thank you! www.intertanko.com Concluding remarks INTERTANKO, from the outset, has been committed to a global system of regulation and one that provides for the practical realities of ships trading in various biological and physical environments. The issues raised in this paper have been brought together to illustrate the challenges the tanker industry is facing in meeting the forthcoming requirements of the IMO’s BWMC. INTERTANKO’s members have undertaken extensive research that accounts for most of the details and information in this paper. Some owners have gone as far as installing systems on new buildings while others are signing contracts for installation on ships that begin construction in the near future. However, the vast majority of the membership of INTERTANKO is still undecided about the correct option for their vessels. Furthermore, the experience of and assessment undertaken by INTERTANKO’s members is very much limited to the installation of systems on new buildings. The installation of systems on existing vessels is largely considered to be technically, operationally and commercially unfeasible at this point in time.