1. SEOUL INTERNATIONAL MARITIME AND SHIPBUILDING CONFERENCE (SIMS) 4 November 2008 Peter M. Swift Managing Director, INTERTANKO

2. Issues and Challenges for Tanker Shipping Energy and oil demand Oil supply Tanker supply Industry Performance Global Financial Crisis Principal Issues and Challenges for Tanker Shipping

3. Primary energy consumption by fuel Billion tonnes oil equivalents

4. World oil demand mbd 65 70 75 80 85 90 199319941995 199619971998199920002001200220032004200520062007 20082009

5. Oil demand by area mbd Source: BP/IEA

6. Oil consumption per capita Litres per year 0 300 600 900 1,200 1,500 1,800 2,100 2,400 2,700 3,000 USA JapanUKEuropeRussia China

7. World’s largest net oil exporters mbd

8. The importance of oil tanker transportation World Oil Consumption 4.0 billion ts per year Transported by sea 2.6 billion ts per year > 60% transported by sea

9. Issues and Challenges for Tanker Shipping Tanker supply

10. Tanker fleet above 10,000 dwt m dwt Source: INTERANKO/Clarkson

11. Tanker contracting by segment US$ bn Source: Clarkson Shipyard Monitor

12. Investment in new tankers More than USD 550 billion invested since 2000 with the result that >85% of tanker fleet double hulled in 2010

13. Issues and Challenges for Tanker Shipping Industry Performance

14. Tanker incidents and accidental pollution Number Source: INTERTANKO/LMIU/various ‘000 tonnes pollution

15. Tanker incidents 2007 by type Source: INTERTANKO/LMIU/various

16. Tanker incidents 2008 by type Source: INTERTANKO/LMIU/various

17. Issues and Challenges for Tanker Shipping Global Financial Crisis

18. Global Financial Crisis Fleet Development & Seaborne Oil Trade Oil tanker fleet m dwt Source: INTERTANKO, Fearnleys Seaborne oil trade bn tonne miles

19. Global Financial Crisis Tanker Fleet Removals Source: INTERTANKO m dwt Conversions 2005200620072008 2009 Small 2 0 13 23 Aframax 0 4 19 14 Suezmax 0 6 13 9 VLCC 2 9 15 30 ? ?

20. Credit crunch – liquidity; financing; exposures; covenants & more…. Oil prices ? Steel prices ? Newbuild / scrap prices ? Economic slowdown (or meltdown !) ? Green agenda slowdown ? Markets ? Other ? Global Financial Crisis

21. Issues and Challenges for Tanker Shipping Principal Issues and Challenges for Tanker Shipping

22. Key challenges for the Tanker industry Maintaining an international framework of consistent, high standards - global governance for a global industry Delivering best environmental performance -meeting society’s expectations Ensuring availability of good people (and quality ships) - a quality as well as a quantity issue

23. Maintaining an international framework of consistent, high standards Support for: IMO and international rather than unilateral local, national or regional legislation Ratification of IMO (and ILO) Conventions IMO Member State Audit scheme plus transparency in findings Greater harmonisation and uniformity in procedures across Port State Control regimes, and better targeting procedures Quality Coastal State initiative (to live up to their obligations, - ensuring fair and consistent processes) Development of Common Structural Rules for Tankers & Bulkers Uniformity in classification societies of requirements, standards and interpretations, survey procedures, etc. Greater uniformity in chartering practices and standards

24. Delivering best environmental performance Anti-fouling systems Ballast Water management Biofouling Ship Recycling Port Reception Facilities (adequacy & affordability) Waste management (onboard and ashore) Marine Noise pollution Whale strikes Spill Prevention and Response Planning VOC emission reductions Exhaust Gas emissions (Annex VI & its revisions) Green House Gas emissions

25. Ensuring availability of good people - recruitment, training and retention Initiatives covering: Raising awareness of the industry, (www.maritimefoundation.com) Attracting entrants to the Maritime Professions (IMO Campaign) Provision of Cadet berths and training facilities on ALL new ships Maximum utilisation of cadet berths on existing ships Development of Tanker Officer Training Standards (TOTS), covering proficiency and experience, as the industry standard Establishment of Seafarer Focus Groups to provide feedback of experiences

26. Ensuring availability of good people - welfare and well-being Initiatives covering: Unjustified criminalisation, including challenges through the courts Support for IMO-ILO guidelines on Fair Treatment of Seafarers (in event of Maritime Accident) Improved conditions for shore access when security constraints active Reduction in number of inspections Lessening the technical and operational burden of equipment, systems and associated paperwork Guidelines for safe handling of cargoes and fuels, tank cleaning and entry Guidelines on implementing ILO Convention on “work and rest hours” Higher standards of accommodation as industry “norms”

27. Hebei Spirit – and the IMO/ILO Fair Treatment Guidelines Captain Jasprit Chawla & Chief Officer Syam Chetan of Hong Kong-based tanker Hebei Spirit, with Roberto Giorgi president of V. Ships

28. PIRACY – Somali coast / Gulf of Aden Message from International Shipping to the IMO, governments and the UN: 1.Commit sufficient numbers of warships, military aircraft and surveillance assets to the region and coordinate their command and control under the auspices of a United Nations mandate, 2.Enhance the existing UN Security Council resolutions 1816 and 1838 with a further resolution with more explicit text on action required against the criminal gangs and with a timeframe adequate to reaching a final solution, 3.Establish a legal jurisdiction to bring arrested criminals to justice and subsequent punishment. In this regard States are particularly urged to review and amend national legislation to include such due process, noting their obligations under the Convention for the Suppression of Unlawful Acts against the Safety of Maritime Navigation, 1988 (SUA Convention).

29. Thank you 감사합니다 For more information, please visit: www.intertanko.com www.poseidonchallenge.com www.shippingfacts.com www.maritimefoundation.com

30. Encouraging Ratification by States of International Conventions IMO Conventions including: International Convention on the Control of Harmful Anti-fouling Systems on Ships (AFS), 2001 (*) International Convention for the Control and Management of Ships’ Ballast Water and Sediments, 2004 Annex VI: Prevention of Air Pollution from Ships, 1996: International Convention for the Prevention of Pollution from Ships, 1973, as modified by the Protocol of 1978 relating thereto (MARPOL 73/78) (*) !996 Protocol to Convention on Limitation of Liability for Maritime Claims (LLMC), 1976 (*)Even though Entered/Entering into Force

31. Encouraging Ratification by States of International Conventions Continued: IMO Conventions including: International Convention on Civil Liability for Oil Pollution Damage (CLC), 1969 International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage (FUND), 1971 International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea (HNS), 1996 International Convention on Civil Liability for Bunker Oil Pollution Damage, 2001 (*) ILO Convention(s): Seafarers' Identity Documents Convention (Revised), (C185), 2003 Maritime Labour Convention, (MLC) 2006 (*) Even though Entered/Entering into Force

32. Shipping’s GREEN Credentials This car, weighing one tonne, uses 1 litre of fuel to move 20 kms This oil tanker uses 1 litre of fuel to move one tonne of cargo 2,500 kms –more than twice as far as 20 years ago