Japan's first ship-to-ship transfer service launched close to Shimonoseki port

2013-07-23

A ship-to-Ship transfer facility for crude and clean petroleum products including Liquefied Petroleum Gas has been launched in Japan for the first time by a UK-based company, a company official said Monday.

SafeSTS, a Norfolk-headquartered company, will offer STS services in the waters belonging to Japan exclusive economic zone near the port of Shimonoseki at the southwestern tip of Honshu Island facing the Tsushima Strait.

The company began offering the service from this month in the international waters falling under Japan's exclusive economic zone using the Shimonoseki port as a base.

With the area having draft restrictions, SafeSTS is offering transfers between vessels up to VLCCs as well as Suezmax tankers, smaller range, medium range and coastal tankers for crude and refined products.

It took almost two years for SafeSTS to get permission from the Japanese government and regulatory authorities for launching the service, according to the company's marine director, Captain Bob Gilchrist.

"It's a very conservative approach. We must make everyone feel very comfortable before we take it to a bigger level," Gilchrist said in a phone interview, adding the company was getting support from the Japanese supply chain and benefiting from its local knowledge and experience.

Currently, most of the Japanese STS requirements are carried out at South Korea's Yeosu port since such marine operations for transferring crude and refined products were not permitted in Japanese territorial waters or in its exclusive economic zone until recently.

According to shipping sources, so far there have been a few instances of ship-to-ship transfer involving LNG cargoes in Japanese waters, but none for crude or refined products.

"STS happens for many reasons. It offers a lot of flexibility. Currently, a lot of long haul cargoes come to Singapore where STS is carried out and bulk-breaking is done before it is shipped to Japan," Gilchrist said, adding that the company was yet to carry out its first STS operation off Shimonoseki.

Asked if waters close to Shimonoseki were the best area in Japan for offering STS services, he said for such operations it is always a compromise between the logistics and the weather at the location.

"There is no such thing like a perfect area for STS operations," Gilchrist said.

Meanwhile, the STS costs will vary dependent on the operations requested, according to Gilchrist.

"[The cost] will certainly be competitive. Once mobilized, consecutive operations will benefit from economies of scale making ship to ship transfer a real opportunity for traders and charterers to see real savings," he said.

Source from : Platts

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