OCIMF Ports & Terminals Committee APRIL 1, 2009 INTERTANKO ISSUE OVERVIEW JOSEPH ANGELO DEPUTY MANAGING DIRECTOR

INTERTANKO EPA NPDES VGP RECEPTION FACILITIES IN THE US TERMINAL VETTING DATABASE

INTERTANKOMISSION SAFE, ENVIRONMENTALLY Provide Leadership to the Tanker Industry in serving the World with the SAFE, ENVIRONMENTALLY SOUND AND EFFICIENT SOUND AND EFFICIENT seaborne transportation of oil, gas and chemical products

INTERTANKO PRIMARY GOAL Lead the CONTINUOUS IMPROVEMENT of the Tanker Industry’s Performance in striving to achieve the Goals of: ZERO FATALITIESZERO FATALITIES ZERO POLLUTIONZERO POLLUTION ZERO DETENTIONSZERO DETENTIONS

INTERTANKO 270+ Members in 45 Countries 3,000+ Tankers 230+ Million DWT MORE THAN 80% OF THE INDEPENDENT TANKER FLEET 350+ Associate Members

INTERTANKO No. members/million dwt No. tankers

EPA NPDES VGP Sept 2006 – District Court orders EPA to develop NPDES regulations for all ship discharges vacating EPA exemption on Sept 30, 2008 July Appellate Court supports District Court decision August 2008 – District Court grants EPA requested extension until Dec 19 Dec 18, 2008 – Final Vessel General Permit (VGP) is published in Federal Register Dec 18, 2008 – Industry coalition convinces EPA to request further extension of court vacatur Dec 19, 2008 – District Court grants EPA requested extension until Feb 6, 2009

EPA NPDES VGP APPLICABILITY Applies to all commercial vessels 79 feet in length or greater Covers US inland waters and within 3 nautical mile territorial sea Applies to 26 discharges incidental to ship operations

EPA NPDES VGP VGP COVERAGE Automatic coverage for all vessels calling on the US until Sept 19, 2009 Shipowner/operator (300 grt or more) must submit a Notice of Intent (NOI) for ship to be covered by the VGP by Sept 19, 2009 EPA requires NOI to be submitted for each ship starting June 19, 2009 EPA developing e-NOI for electronic submissions

EPA NPDES VGP KEY PROVISIONS OF NPDES PROGRAM Discharge limits (Section 2) - Best Management Practices for 21 of the discharges - Specific requirements for ballast water, grey water, bilge water, antifouling and underwater husbandry Additional requirements for tankers for inert gas scrubber, deck seals, scuppers, inspections and crew training (Section 5.5)

EPA NPDES VGP KEY PROVISIONS OF NPDES PROGRAM Corrective Action, self-policing (Section 3) Inspections and monitoring (Section 4.1) - Routine visual inspections (weekly) - Comprehensive annual inspections - Drydock inspections - Quarterly sampling of discharge streams Recording keeping (Section 4.2 and 4.3) Reporting (Section 4.4)

EPA NPDES VGP KEY PROVISIONS OF NPDES PROGRAM Section 6 contains specific requirements for individual states and Indian tribes Industry coalition successful in convincing: - California, Illinois, and New Jersey to delete certain standards; and - Oregon to be covered by NPDES VGP New York has used VGP as backdoor vehicle to impose ballast water requirements which is being challenged in court

EPA NPDES VGP FAILURE TO COMPLY CAN RESULT IN: Civil penalties Criminal penalties Citizen lawsuits

EPA NPDES VGP INTERTANKO has issued Guidance and Compliance Plan for VGP requirements Summary of requirements and compliance dates Clarification of NOI requirements Company compliance map Overview of inspection, sampling, recordkeeping and training requirements Model forms to record inspections, sampling and corrective action

EPA NPDES VGP RECENT DEVELOPMENTS Environmental groups sue EPA stating the VGP discharge requirements (ballast water) are not stringent enough Lake Carriers Association (LCA) sues EPA requesting the court to vacate the VGP LCA chose not to discuss with industry coalition members Cases have been consolidated in the DC Circuit court

RECEPTION FACILITIES USCG Regulations issued in early 1980s Are comprehensive Provide flexibility Clearly stipulate criteria Contain enforcement provisions Encourage feedback

RECEPTION FACILITIES The problem is: USCG has no direct authority to require reception facilities USCG only has authority to certify the adequacy of reception facilities USCG “will rely on market forces to keep reception facility usage reasonable” Reception facility Certificate of Adequacy remains valid until suspended or revoked

RECEPTION FACILITIES In the late 1980’s and 1990’s USCG receives sporadic reports of “inadequate reception facilities” through reports submitted to IMO Main complaints - Too expensive - Undue delay For about 20 years, USCG gives reports of inadequate reception facilities low priority

RECEPTION FACILITIES In the 2000’s two major issues significantly altered the playing field: - US Department of Justice criminal prosecutions of ship pollution incidents - Maritime security regulations (MTSA & ISPS Code) INTERTANKO and other began a more focused campaign to bring the problems with the availability of reception facilities in US ports to the attention of the US Coast Guard

RECEPTION FACILITIES Main problems included: Certified reception facilities unwilling to receive wastes (discharges prohibited) Severe restrictions on when, where or how the facilities would receive the waste (undue delay) Inadequate capacity Excessive costs Technical difficulties

RECEPTION FACILITIES USCG responds directing field offices to: - ensure compliance with COA during facility exams - reissue COAs with 5 year period of validity after exam - examine declarations of inspection - examine waste stream logs (required under RCRA) reception facility information put on internet :

RECEPTION FACILITIES INTERTANKO/USCG develop standard format for reporting inadequate reception facilities USCG strongly recommends that an inadequate reception facility should be reported immediately to the local COTP (33 CFR ) to conduct an investigation If not possible, or preferred, use INTERTANKO format for submittal to USCG Headquarters

RECEPTION FACILITIES Recommended process – Check USCG web site to determine if facility has CG issued COA Contact facility to discuss discharge of wastes If problem arises, contact COTP If preferred, submit completed form to INTERTANKO Form is reviewed and, if appropriate, submitted to USCG Headquarters Form is reviewed at USCG Headquarters and, if appropriate, forwarded to field office for investigation

RECEPTION FACILITIES Results thus far – 12 cases of reported inadequate reception facilities 8 cases provided sufficient information for USCG to conduct follow-up investigation 2 investigations resulted in USCG taking administrative action in the form of a letter of warning issued to the facility

RECEPTION FACILITIES USCG regulations are comprehensive USCG has limited authority USCG enforcement was lax, but that has changed Many tanker operators are reluctant to report on charterer terminalsMany tanker operators are reluctant to report on charterer terminals INTERTANKO format provides a vehicle to report Reporting can make a difference

RECEPTION FACILITIES Recent Developments: Concern has been raised over state (CA) requirements for handling of “hazardous materials” USCG has tasked the Chemical Transportation Advisory Committee to develop “improvements to the criteria for adequacy of port reception facilities” USCG holds public hearing to receive comments from public/industry

TERMINAL VETTING What?? A process by which ship operators can provide subjective assessment of terminal conditions Input is fed into a database to enable members to share experiences of terminal conditions Not an approved or non-approved stamp on individual terminals

TERMINAL VETTING Why?? Enhance safety at the terminals Improve member effectiveness in influencing terminals to ‘fix’ problems Maintain/improve industry safety record

TERMINAL VETTING Access to the system is controlled by INTERTANKO and is strictly limited to INTERTANKO members The Terminal Vetting Database is hosted by in partnership with INTERTANKO NOT a commercial enterprise, provided at no charge to INTERTANKO members Access is usually set up in one business day

TERMINAL VETTING THE FORM IS: - SIMPLE - ONE PAGE - USER FRIENDLY The source of information is kept confidential and although the vessel name, voyage number and Master are included as information categories in the report form, this information is for the individual company’s and INTERTANKO’s use only and will not be accessible on the web site

TERMINAL VETTING RATINGS 1 - PoorWorse than average in all areas, needs a lot of improvement 2 - Below AverageWorse than average in some areas, could use some improvements 3 - AverageFully adequate 4 - Above AverageBetter than average in some regards 5 - ExcellentOf a very high quality in all regards

TERMINAL VETTING How is it used?? Level 1: Tanker operators can review terminals prior to vessel’s call Level 2: Tanker operators are encouraged to discuss “poor reports” directly with the Terminal Level 3: The INTERTANKO Vetting Committee will assist in cases where the terminal does not respond or responds poorly to the owner’s requests and will be tasked to follow-up with any terminals not responding to Owner’s observations.

TERMINAL VETTING To date we have received over 7000 reports from more than 100 companies Induced at least three terminals to make extensive improvements Started constructive dialogue with many others Reached agreement to work in partnership with BP Received dozens of enquiries from terminals around the world requesting feedback on their terminals in order for them to review and improve (if necessary!)

TERMINAL VETTING Terminal Satisfaction Sheet As part of ongoing work within the Vetting Committee, INTERTANKO has now made available a "Terminal Satisfaction Sheet" A simple one page feedback form The concept is to enable the ship and the company to acquire useful feedback from the terminal, regarding the ships performance, prior to the ships departure, primarily pertaining to the safety aspects of the vessel with a focus on continual improvement.

TERMINAL VETTING Use of the Terminal Satisfaction Sheet Ship requests terminal to complete the form –Master to jetty foreman or other terminal representative –Master submits to the company. To stimulate input and support (for use of the form) from the vessel –we encourage owners/managers to supply feedback to the vessel on the points raised While we anticipate that the majority of the terminal satisfaction sheets received will be positive what's important will be the small amount which are not and its these that will be effective in the seeking the goal of continual improvement.

THANKYOU!!