LNG Carriers Feel Pinch Of Officer Shortage.
The current ‘credit crunch’ has affected all industrial sectors and shipping is no exception to this. However, in the industry, one of the prevailing concerns in recent years has been the existing and anticipated significant shortfall in seafarers and qualified officers capable of fulfilling roles on vessels, and this one is likely to persist for the foreseeable future. Lightly termed as the “Crewing Crunch”", the ship owners are looking for more than 2,400 officers (in addition to the present figure of 1,300) for the LNG vessels alone as the fleets grows to 384 by 2011 due to an unprecedented boom in the LNG vessels. The industry, therefore, is expected to be hit hard. Its spotless record on safety can be hit if the needed gap in the positions is not filled, as the shortfall is going to affect the safety aspect the most.
The response
The first reaction thus far has been to significantly increase officer wages. The officers are reportedly receiving two to three wage increases a year. However, this move has inspired increased levels of poaching in some cases in the industry, thus making it a viscous circle. Nevertheless, with the recognition that such an action can only fill up position in the short-term, the companies are now increasingly making a shift towards investing in training and incentive programmes and, thereby, hoping to retain existing crew and develop the next generation of officers. Whatever the form of response, it is likely to take time to bear fruit and will come at a cost.
The Cost
The usual time-period under which the LNG vessels are operated is a long-term charter (15 to 20 years). As per a typical time charter, owners have to pay for wages and expenses of the master, officers and crew. However, in real case scenario, this expense (whether in full or in part) is ultimately borne by the charterer throughout the charter term. With the rapid increases in the manning costs, it is becoming increasingly complex to assessment the economic feasibility of a project by owners and charterers alike. One of the fallouts of this is the heightened safety risk thus perceived, which, in turn, leads to significant annual increases in insurance premiums. Whereas the hire payable under a short term charter is usually fixed, in long term charters, owners are uncomfortable with taking the risk of increased operating costs and therefore a proportion of hire may be based on actual operating costs incurred by the owner. Depending on the strength of its negotiating position, the owner can sometimes secure payment of its operating costs on a “pass through” basis.
What Else Is Required?
According to the ShellLNGTime1 form, typically used for short-term charters, an owner has to provide a vessel with “a full and efficient complement of master, officers and crew for a Vessel of her tonnage, who shall in any event be not less than the number required by the laws of her flag state and who shall be trained to operate the Vessel and her equipment competently and safely.” This has to be continually made available throughout the charter period and the owner has to exercise due diligence to maintain, and to the extent necessary, restore the vessel to its condition as at the time of delivery. In some cases, the owners admit to a strain on them to find especially experienced people for the LNG vessels as these are specialist vessels. An LNG vessel can have 27 seafarers comprising: 5 deck officers, 5 engineer officers and 17 crew members. However, extra hands are likely to be required in order to account for illness, holidays and turnover of staff. The master and senior officers have at least 6 months’ sailing experience (within the previous 5 years) onboard an LNG vessel and many charterers insist on this. Although, it is very rare to come across an incident in the LNG sector, still, there are additional fears that owners might be forced to lay-up vessels following delivery because of insufficient crew levels.
Competence And Safety
With no major incident reported over the past four decades, the LNG sector’s safety record to date is excellent. This is primarily because safety has always been a sensitive issue for the LNG industry. However, there are rising concerns that the sheer number of vessels could cause compromises in quality leading to an increased risk of accidents. Crews have been reported to threaten abandoning duties if they are not promoted quickly enough and hence there are cases of rapid promotions without the requisite experience. Additionally, there is evidence that companies are hiring seafarers sacked by other companies for incompetence or poor attitudes, without paying attention to their previous employment record. Whilst these factors do not necessarily make an accident inevitable, they definitely lead to increased concerns over crew shortages, fatigue and overwork.
Solution
One of the solutions that the industry has come up with is to improve the employment criteria and conditions under which seafarers are hired. Some seafarers are now being employed on long-term contracts (rather than on a voyage by voyage basis) which include medical and welfare services, pensions and also shorter sailing periods and extended leave. It is hoped that this will not only address the issue of crew retention but will help attract new people to the industry. These improved conditions are likely to become an industry standard by the start of the next decade, when it is expected that the Maritime Labour Convention 2006 (MLC) will come into force. The MLC speaks of a comprehensive set of global standards and these standards are derived from the 68 maritime labour instruments adopted by the International Labour Organisation (ILO) since 1920. In addition to the MLC, the International Maritime Organisation is also working on an international agreement on fatigue and crewing levels. The EU has also pitched in with a debate as to whether the working time directive should apply to shipping. A training initiative by the Society of International Gas Tanker and Terminal Operators (SIGTTO) is also on the anvil, which helps set minimal operational standards for offices on LNG carriers.
Source: shipping-news.net
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