Oaktree Bails on TORM Stake Sale
Asset management giant Oaktree Capital Management has abruptly terminated its sale of 5 million Class A common shares in TORM plc (Nasdaq: TRMD or TRMD A), a leading tanker company,...
Shipping’s ongoing evolution of improving its safety, security, health, environmental and operational performance makes this a defining time for the industry. MIS Marine’s Americas Executive Gonzalo Mera Truffini explains how building a better understanding of a vessel’s entire risk portfolio through Marine Assurance can act as a springboard to support the most complex situations concerning the environment and maritime safety.
The phrase “take action now’ couldn’t speak more truth when it comes to shipping’s trajectory towards a cleaner, safer and more secure industry. This is particularly the case in Latin America. As a region, Latin America has deep roots in the maritime industry, and in recent years has accounted for around 17% of the world’s total shipping cargo. A core focus for Latin American stakeholders is environmental incidents and pressures, and their resulting operational and reputational impacts. But limited worldwide support and legislative pressure to drive better standards is hindering the region’s ability to tackle and avoid environmental challenges.
In recent years, Latin America has suffered several environmental marine incidents. As an example, there have been a vast number of oil spills, which have left damaging effects on marine life, people, communities, and companies reputations, as well as extremely consequential high costs. Even 11 months after the major oil spill in the Pacific Ocean near Callao, Peru, cleaning efforts are ongoing with more than 57 million USD spent on the initial response and the current remediation of the affected areas.
In comparison, when similar incidents have occurred in Europe or off the coast of the US, it has led to an active involvement from environmental agencies and sparked climate debates among multiple stakeholders.
As is the case with any region or industry, avoiding damages, incurred costs and fines are the bigger motivators. This underlines the case for placing greater emphasis on risk management using insightful real-time data to support decision making and demonstrate operational excellence.
Taking the lessons learned from all the incidents by engaging with and further educating the industry on the risk associations will help to prevent future incidents. So how can we build a clearer picture on environmental cases and better understand a vessel’s entire risk portfolio?
A proactive approach to environmental risk
Building an awareness and understanding of how vessels could increase risk levels will empower organisations to efficiently and cost effectively develop and implement better practices to reduce their risk exposure. By combining big data with in-depth analysis relating to vessel locations, voyage histories, vessel ownership and operation, as well as cargo and crew manifests, Marine Assurance is an extremely powerful tool for understanding an entire risk portfolio.
The progress made in Marine Assurance over the decades has had a profound impact in reducing the number and impact levels of serious tanker incidents through the quality of inspection and assessment data. This has run in parallel with an increase in assurance uptake, as there is a clear correlation between the introduction of each new assurance process and a decline in serious incidents. For example, the number of incidents in the 1990s was reduced to an average of 35.8 a year – compared to 45.4 a year in the 1980s. In addition, the number of oil spills more than 700 tonnes reduced to 15% – compared to 25% the previous decade – following the implementation of the SIRE programme that launched in 1993.
Marine Assurance technology has already been instrumental in supporting energy companies, charterers, ports and terminals to understand their risk levels and prevent potential hazards, such as oil spills or a crew member injury. Thanks to big data and artificial intelligence, Marine Assurance can now move beyond the fundamentals of safety and pollution prevention and drive standards of operation, efficiency and compliance, but all of this can be significantly enhanced with close collaboration.
Collaboration at the forefront
Collaboration creates confidence in better understanding risk. Multiple stakeholders working together is the key for navigating through the complexities of the maritime industry. But as a collective, more action can be taken in sharing experiences, perspectives and knowledge on the best practices and lessons learned from challenges.
In recognising the need to bring about this change, from my unique position of working at both MIS Marine and at the Latin American Society of Maritime Oil Terminals and SBM Operators (SLOM), we are able to ensure that the two organisations are working as collaboratively as possible to push for greater proactivity and connecting key stakeholders. MIS Marine supports SLOM’s initiatives in Latin America by sharing its extensive experience as a vetting and compliance solutions provider for maritime terminals and SBMs.
Other organisations are also recognising the need to increase awareness and action. Following the oil spill incident off the coast of Lima, Peru in January 2022, SLOM and the UK government held workshops with the local players on a response to marine pollution: preparedness and best practices. These examples show that the industry is moving in the right direction, and we recognise our responsibility as a Marine Assurance pioneer to continue to drive progress.
The marine industry has no borders, so, as a global industry, we must take a major step forward in improving standards on these environmental cases by acting before they happen. As is the case with all countries, Latin American countries can be provided with the tools to understand and reduce their risk exposure that will help to reach the industry’s goal of creating a more sustainable, efficient and safe maritime industry. Achieving this ultimate goal will require collaborative vetting processes that can optimise the operational, environmental and safety standards across Latin America.
Join the 88,940 members that receive our newsletter.
Have a news tip? Let us know.