Greek Shipping News Cuts
Week 21 - 2010


Akti Miaouli / People & Places

* George D Gourdomichalis is the new president of the Piraeus Marine Club following elections for the club's board during the agm May 20. The new board convened as a body and elected the following officers by secret ballot. President:EGourdomichalis; V-P: John A Xylas; General secretary:EVassilis K Spiliopoulos; Treasurer:EMaria S Prevezanou; and Members: Evangelos S Marinakis, Anna S Polemi, Alexios A Rodopoulos, John Th Trifyllis and P Elias Tsakiris.
* Haralambos J. Fafalios, a member of the council of the London-based Greek Shipping Co-operation Committee (GSCC) since 2002, has been elected its new chairman. A London Greek, Fafalios, 49, comes from a long-time seafaring family from Chios. Both his grandfathers were seafarers, while he himself is proud to have first-hand knowledge of the profession, having served three terms at sea. He was educated in London and then completed his university studies in Newcastle. He has worked with his family company, Fafalios Ltd as a Baltic shipbroker for over 25 years and is actively engaged in chartering on a daily basis. He has a working knowledge in marine insurance, banking and all aspects of shipbroking (dry, wet, s&p, research). He sits on various industry bodies, including the Board of the Baltic Exchange, Intercargo and the American Bureau of Shipping committees. His father John D. Fafalios served on the GSCC board for many decades. -- See Newsfront, Vol 11 Nr 20, for the full GSCC board.
* Evangelos Marinakis has emerged as the potential new owner of Piraeus soccer club Olympiakos. According to media reports, the club is looking for an injection of cash, if not a new owner to succeed Socratis Kokkalis and Marinakis, head of the Piraeus-based Capital Shipping Group, is said to be willing to pay Euro 50m for a controlling stake, provided Kokkalis covers the club's debts. A club board meeting is set for June 14, when a new administration will be elected.
* The Union of Greek Shipowners of Towing & Salvage Vessels has elected the following board: President: Anastassios Michalaros; V-P: Nikolaos Zouros; General secretary: Ioannis Benzonanas; Treasurer: Pavlos Xiradakis; and Members: Andreas Vatistas, George Giannitsis, Ioannis Zoumboulis, Constantinos Lymboussakis and Nikolaos Tsavliris.
* NYSE-listed Navios Maritime Acquisition has confirmed Rex Harrington is unable to join the company's board "due to concerns raised about potential applicability of the Clayton Antitrust Act as a result of his current directorships". Harrington's appointment was announced in April at the same time as blank cheque company Navios Acquisition revealed its plan to acquire 13 tankers for $457.4m, a deal which has now cemented. Harrington is on the board of NYSE-listed tanker owner GenMar.
* Innovative electrical solutions for cargo cranes and hatch cover operations, were highlighted during a series of presentations given by Piraeus-based Oceanking Technical & Trading and Cargotec (MacGregor) at the Ledra Marriott Hotel, Athens, May 19. Introduced by Apostolos Bekiaris Oceanking, operations manager, the Cargotec team of Paul Soderstedt, Torbjorn Dahl, Bjorn Stenwall and Roberto De Gioia, presented the latest electric crane solutions; Electric drivers for side-rolling hatch covers, outlining how they are an environmentally friendly and economic solution; and the global and local customer support services of the Cargotec organisation, which also hosted a cocktail reception.
* Eastern Mediterranean Maritime/Thanassis Martinos has relocated its office to: 69 Gr Lambraki Street, 166 75 Glyfada, Athens Tel: 2109699 700 Fax: 210 9604 430 / 1 E-mail:

Why the Koreans have come to Greece in search of shipbuilding contracts
Nevertheless, the Korean stands will welcome Greek owners with their usual charm, as indeed will the Chinese, who have also brought a strong presence. Last year China took 44% of the newbuilding orderbook, slightly more than Korea, although the balance is beginning to change. Koreans no longer seek out cheaper ships but go for the more sophisticated tonnage, pure chemical and chemical/product tankers, LNG and LPG carriers and, Korea hopes, cruise ships.
With China taking the bread-and-butter business, Korea has had little option other than to diversify the portfolio and seek out opportunities outside shipbuilding. These include renewable energy and offshore projects.
Source: Fairplay - Powerhouse 27 May 2010

Greeks continue to be active
--- excerpt from BRL Weekly Newbuilding Contracts report 28 May 2010
Greeks continue to be active. Conservative owner Kassian Maritime booked a single kamsarmax at Guangzhou Longxue for delivery as far ahead as March 2013. The owner takes a cautious expansion approach and will not over expose itself. Price level is around $35-36 million. Similarly Greek domiciled Lomar Shipping & Management (not connected with Lomar Shipping, London) ordered it first ever newbuilding in the form of a baby cape. One plus optional one 114,500 d.w.t. unit has been contracted from Shanghai Shipyard for delivery in June 2012 at an estimated per unit cost of $43 million. The option is likely to be exercised by the end of June this year. A competitive price was secured by virtue of a large cash down payment.
Conservative owner Kassian Maritime booked a single kamsarmax at Guangzhou Longxue for delivery as far ahead as March 2013. The owner takes a cautious expansion approach and will not over expose itself. Price level is around $35-36 million. Similarly Greek domiciled Lomar Shipping & Management (not connected with Lomar Shipping, London) ordered it first ever newbuilding in the form of a baby cape. One plus optional one 114,500 d.w.t. unit has been contracted from Shanghai Shipyard for delivery in June 2012 at an estimated per unit cost of $43 million. The option is likely to be exercised by the end of June this year. A competitive price was secured by virtue of a large cash down payment.
Source: BRL Weekly Newbuilding Contracts report 28 May 2010

Genmar could launch follow-on offering to fund Metrostar buys
---Data provided by Lloyd's List Intelligence
Genmar set to buy five VLCCs and two suezmaxes from Metrostar
GENERAL Maritime is tipped to launch a follow-on share offering if a deal to acquire nine tankers from Metrostar is completed.
The vessels, understood to comprise five very large crude carriers built between 2002 and 2010 and two suezmax newbuildings to be delivered by next year, are understood to be changing hands for between $600m and $700m.
General Maritime refused immediate comment. However, ship finance sources said a share issue would be the most logical manner of funding the deal.
General Maritime share opened trading today at $6.72, near its 12-month low. In the past year, the share has traded between $6.40 and around $11. The price is above the net asset value of $4.50 to $5 reported by equity analysts.
While follow-on issues remain subject to fluctuations in the wider markets, experts said established public companies might launch secondary share sales if acquisition opportunities arose.
General Maritime had total debt of just over $1bn at the end of the first quarter, including the high-yield issue of $300m last autumn that the company used to reduce some of its covenant pressures on traditional bank debt. Liquidity was $89m.
A May 2010 fleet list for Metrostar by a leading London shipbroker shows 16 ships, including four bulkers in trade, five bulkers on order, the five trading VLCCs, and the two suezmax newbuildings on order.
Mr Angelopoulos steadily has been clearing out his ships since last year, many of which were ordered at the top of the market, at sale prices which leading brokers widely believe are loss-making.

Flame chasing Primera principals
---A Swiss party has had a chemical tanker arrested as it tries to get at the men behind a bust Greek bulker player.
Swiss coal trader Flame SA is pursuing the principals of insolvent Greek bulker operator Primera through chemical-tanker owner Chemnav Shipmanagement in an attempt to secure millions of dollars in defaulted forward-freight agreement (FFA) settlements.
Debt-stricken Primera Shipping (Hellas) Ltd began a Liberian liquidation proceeding in March after struggling to satisfy its FFA counterparties.
Flame apparently hopes to get some of its money by arresting one of the four-ship fleet of Chemnav, the 13,000-dwt products and chemical tanker Lynx (built 2008). Just as TradeWinds went to press, sources indicated that Flame had tried and failed to arrest a second Chemnav ship, the 13,000-dwt Commencement (built 2008).
Chemnav is asking for $20,600 per day in countersecurity while the arrest is in effect, including $6,000 per day in operating costs, $5,100 per day in finance costs and hire of $9,500 per day.
The company insists that Primera, Chemnav and Camela are all part of a group controlled by Paul and Nikolaos Coronis. They point out that names of Primera directors appear on the $87.75m mortgage of the Lynx to HSH Nord-bank and also on a $67.5m credit facility connected with the construction of the four chemical tankers.
As TradeWinds reported last year, Flame won an English High Court judgement for $5.5m against Primera in the FFA dispute. Running interest has subsequently raised the sum to $5.9m and a New York court has confirmed the judgment in the US.
Flame is also claiming that Primera has deliberately delayed invoicing TMT Asia for another $1.8m in order to stop creditors from getting the money.
English judges have been outspoken in their criticism of Primera.
He added that until that very day, the High Court had not been informed of the debts of $15.7m that Primera owed to other creditors.
By Bob Rust Stamford
Published: 21:59 GMT, 27 May 10 | updated: 18:44 GMT, 26 May 10

Chemical and product tankers - will demand outstrip supply?
---We take a look into the future with the aid of a leading analyst and a shipowner who is heavily investing in this sector.
Last year, global demand for clean petroleum products (CPP) increased year-on-year by 1.51% to 437 mill tones.
As industrial output and consumer spending resumed modest growth in OECD countries and continued to post healthy gains in non-OECD countries, the translated tonne/mile demand on products tankers increased by 5.6% year-on-year as growing economies imported CPP from overseas refiners, said McQuilling Services in its latest report.
The Far East saw the largest gains in clean tanker demand last year, sourcing 22% and 23% more trade than the Middle East and northern Europe respectively. Similarly, the Baltic/northern Europe region boosted its tonne/mile demand from Asia by 24%.
Conversely, regional product tanker trades within Asia and the Americas fell year-on-year by 9% and 7% as inter-regional plays produced more profitable options. Specifically, a growing volume of gas oil from the Far East and India was seen moving to Europe, while the latter joined the Middle East in selling naphtha back to Asia. This allowed some attractive backhaul opportunities for CPP tankers.
In the Atlantic, US refinery gasoline output proved substantial enough to curb tanker demand ex Europe by 35%, while maintaining the arbitrage for US diesel exports to the Eurozone, which grew some 10% year-onyear, the report said.
As the overall product tanker demand grew year-on-year, each of the four sectors McQuilling monitored showed substantially different results. For example, the LR2 sector lost nearly 16% of its tonne/mile demand last year, while LR1s gained 23% of the business. MR2s saw a demand increase of 14%, while MR1s lost 13%.
With an increase in supply of MR2s, traders have introduced them on different routes where their economies of scale can be realised without compromising the flexibility inherent to smaller parcel sizes.
Despite a demand loss in the LR2 sector last year, the past 12 months proved relatively healthy for rates when compared with its dirty counterparts. Demand for storage absorbed nearly a third of the LR2 fleet as contango conditions took hold of the products market.
As a result, the 16% loss in LR2 tonne/mile demand was largely outweighed by a simultaneous 30% reduction in available supply. Furthermore, this demand was not necessarily lost, but switched to LR1s and MR2s, which picked up the slack. For example, the MEG/Far East trades saw the swapping of LR2 cargoes into smaller LR1s and MR2s, thereby boosting their demand.
Bears v bulls
As for this year, the bears point to the supply side of the equation. The contango situation has largely unwound releasing products tankers back on to a market that is also suffering from a surfeit of new deliveries. Furthermore, as the LR fleets are relatively new, it is unlikely that scrapping will have any effect on the supply side, McQuilling said.
Refineries in China, India and Russia posted record high utilisation rates in February, while European throughput fell to its lowest level in 17 years.
Worldwide refinery runs are expected to continue to rise, reaching 72.9 mill barrels per day in 2Q10 for a 1.4% increase year-on-year. This should provide further product tanker demand. However, as India and Russia increasingly feed nearby Asian demand, and European refining recovers from a weak first quarter while Venezuela suffers from overdue downstream investment, the extent to which CPP demand translates to tonne/miles is yet to be seen, McQuilling concluded.
In a lengthy statement, the company outlined its reasons for taking the plunge. Navios Acquisition said that it believed the product and chemical tanker sectors are both fundamentally attractive because of the current opportunity to acquire tankers near their inflation adjusted historical low prices.
According to industry sources, product tanker values have declined significantly from the recent peak in 2008, with newbuild 50,000 dwt tankers declining from an average of $52.1 mill in 2008 to $34.5 mill in 2010. Chemical tanker prices are also near their inflation adjusted historical low, with newbuilds in the 25,000 dwt range declining to an average of $42 mill in 2010.
The recent decade's growth in demand and macroeconomic drivers suggest continued increase in demand as the global recession eases. During the period 2000-2009, demand for transporting refined petroleum products
increased by approximately 8.6% per annum. Demand for transporting bulk liquid chemicals increased during this same period by approximately 5.7% per annum.
Emerging markets were significant demand drivers and are expected to continue as emerging markets, particularly Asia and the Middle East, build additional refinery capacity. Moreover, as the global economies exit the recession, OECD countries will likely create significant additional demand for tanker services.
Navios head Angeliki Frangou said, "We believe that the market opportunity, which stresses environmental safety and quality of operations, highlights our operating strengths. Furthermore, the recent financial crisis and related developments in the product and chemical tanker sectors have continued to affect adversely the availability of credit to shipping industry participants, creating opportunities for well-capitalised companies with committed available financing such as ours."
Focused business strategy
Fleet composition
The company has initially committed itself to 15 vessels, including two options yet to be declared.
Navios Maritime Acquisition Corp -to give it its full title - is a publicly traded Special Purpose Acquisition Corporation (SPAC) formed under the laws of the Marshall Islands.
Navios Acquisition serves as a vehicle for acquisition through a merger, capital stock exchange, asset acquisition, stock purchase or other similar business combination, one or more assets or operating businesses in the marine transportation and logistics industries.
If the vessel acquisition is approved and completed, the new company will have a fleet of 13 tankers, consisting of 11 product tankers and two chemical tankers, plus options to purchase two additional product tankers.
Of the 13 vessels, nine 25,000 dwt.

Cabotage bill watered down
---The revised version of a draft law that seeks to lift cabotage rules, in order to allow vessels not flying a European Union flag to moor at Greek ports, dictates that the ships in question employ an unspecified number of Greek seamen and that they pay a levy upon docking in Greece, the size of which will depend on the number of passengers aboard the cruise liner, sources have revealed.
To emphasize its demands, the PNO has called a 24-hour strike for Monday which will result in the suspension of all ferry routes. On the same day, protesting seamen are planning to converge at the main port of Piraeus and prevent tourists from boarding the Zenith, a Malta-flagged, US-owned cruise liner. At the end of last month, the Zenith was forced to remain moored at Piraeus after protesting seamen barred 970 tourists from reboarding the vessel. The tourists spent the night at hotels in the capital.

NOT GUILTY!! Chief Engineer Acquitted in Texas 'Magic Pipe' Pollution Trial
---HOUSTON, April 28 -- A jury in Houston federal court cleared Greek Chief Engineer Ioannis Mylonakis of all five (5) felony charges that he engineered the dumping of oil tanker waste off of the Texas coast in early 2009. The jury rejected claims by U.S. Department of Justice Environmental Crimes Section that Mr. Mylonakis, as chief engineer of the 40,000-ton M/T Georgios M, ordered his crew to use a so-called "magic pipe" to bypass pollution control equipment and discharge sludge and oily waste into the seas near Houston and Corpus Christi, Texas. Mr. Mylonakis was represented by 'magic pipe' specialist, George M. Chalos and George A. Gaitas, of Chalos & Co, P.C.,-International Law Firm and Joel Androphy and Kathryn Nelson, of Berg & Androphy, of Houston.
At trial, eight (8) crewmembers testified for the government that Mr. Mylonakis orchestrated the magic pipe bypass during his tenure on the vessel. The defense team demonstrated that the crew misled the government about the involvement of Mylonakis in return for grants of immunity. The jury found that the Filipino crewmembers were not credible.
In an extraordinary ruling, presiding Judge Kenneth Hoyt struck the testimony of the U.S. Coast Guard Marine Safety Lab's expert chemist, ruling it confusing and irrelevant. Mr. Mylonakis' defense presented a letter from a former whistleblower alerting the government to the use of "magic pipe" equipment in 2006, but there was no indication of a subsequent investigation by the Coast Guard or the DOJ. A crew witness who signed the letter testified it was prepared and signed as revenge against a former company official.
Defense counsel, George M. Chalos, said, "There was good reason that Chief Mylonakis defiantly testified in his own defense and loudly protested the charges. He is innocent. The real shame of this case was the vessel's owner and operator trying to scapegoat and blame Mr. Mylonakis for acts he didn't do, which was compounded by the government's failure to appreciate the facts as they truly exist and its decision to try to convict an innocent man."
Attorney, Joel M. Androphy, said, "This is an extremely rare defense victory. What we showed demonstrated that the crew misled the government about the involvement of Chief Mylonakis in return for grants of immunity."
As for future civil actions by Chief Mylonakis against Styga, Mr Chalos said: "The company pled guilty, blamed our client without good cause, and just threw him under the bus for their own benefit. I will be in Greece soon and expect to visit the Mamidakis clan [Styga's owners] when I get there. They have an awful lot of explaining to do here and better start undertaking the necessary preparations to try to make up for their absurd actions and the damages they have needlessly caused to Mylonakis family. If they don't, they are going to get it with both barrels."
The case is "U.S. v. Mylonakis," Case No. 4:09-cr-00492, in the U.S. District Court for the Southern District of Texas.
Read the Tradewinds article on the case (published) in the April 20, 2010 edition at:

Internaftiki announces exciting new location in the heart of Piraeus
distinct design for Piraeus. Characterised by its remarkably modern materials and colour branded windows, this alternative designed building which covers nine floors is sure to make a mark in what is the largest marine based shipping centre of Greece.
An opening ceremony is expected to take place at the beginning of June, in view of the forthcoming Posidonia International shipping exhibition 2010.
Internaftiki sa was inaugurated in 1975 near the Port of Piraeus. The company specialises in the field of marine and industrial products, offering an entire range of service activities on ships and yacht machinery. All services are executed on a worldwide basis by highly qualified personnel who hold exceptional knowledge in this field.
For more information, contact Ms. Litsa Kokkinaki on +30 210 4126997 or email
Source: Wednesday, 26 May 2010 14:06 nafsgreen