Marshall Islands Ship Registry on track to become second largest, first among Hellenic ship owners
The Marshall Islands ship registry (RMI) is now the third largest in the shipping business, having grown by 17% during 2014. In an interview with Hellenic Shipping News Worldwide, Mr. Theo K. Xenakoudis, Director, Worldwide Business Operations, Managing Director – Piraeus, Greece, with International Registries Inc., “as of the end of February 2015, the Registry stood at nearly 118 million GT and over 3,400 vessels”.
At the same time, a paper published by the Greek Shipping Cooperation Committee (GSCC) in April 2014 with data provided by Lloyd’s Register of Shipping-Fairplay, notes the RMI Registry is reaching the top position in the Greek market, gaining more than 43% of the gross tonnage and nearly 55% of the total number of vessels gained overall. According to Mr. Xenakoudis, “nearly 40% of the bulk carriers in the RMI fleet are Greek owned vessels”.
In terms of performance, how did 2014 fare for the Marshall Islands Registry, compared with previous years?
Irrespective of the growing challenges faced by the maritime industry, the Republic of the Marshall Islands (RMI) Registry has had a particularly successful year, having grown by over 320 vessels and 16 million gross tons (GT), which is a 17% increase in GT from the previous year. The RMI Registry is the third largest registry in the world, and closed 2014 with over 114 million GT and 3,345 vessels. As of the end of February 2015, the Registry stood at nearly 118 million GT and over 3,400 vessels. The January 2015 issue of the World Fleet Monitor, as published by Clarkson Research Services, showed a 14.4% increase in the RMI fleet in 2014, the largest increase of any of the world’s top ten flags during that time (excludes offshore vessels such as mobile offshore units).
Based on the sustained growth of the RMI Registry, the newbuilding commitments, and the international coverage of Registry personnel from the Far East to the United States (US), we strongly believe the RMI will be the second (2nd) largest flag worldwide within the next two years.
In terms of Hellenic-based clients, how did the Registry perform and where does it stand in terms of market share among the Hellenic shipping companies?
A paper published by the Greek Shipping Cooperation Committee (GSCC) in April 2014 with data provided by Lloyd’s Register of Shipping-Fairplay, notes the RMI Registry is reaching the top position in the Greek market, gaining more than 43% of the gross tonnage and nearly 55% of the total number of vessels gained overall. Based on the same report, the RMI flag has a market share of 16% among the Greek controlled fleet.
As shown, in 2014 the number of Greek owned vessels under the RMI flag increased by over 120 vessels. This is the largest increase in number by over 85 vessels compared to the second largest gain.
The RMI Registry’s success in enhancing its fleet and reputation in the international maritime community in 2014 is largely attributed to its Greek clients, as the largest percentage of the RMI Registry’s fleet derives from the Greek shipping community. Nearly 40% of the bulk carriers in the RMI fleet are Greek owned vessels. As of February 2015, according to the Shipping & Finance February 2015 issue, the Greek owned fleet consists of 793 RMI flagged vessels and 60,455,495 deadweight tons. The RMI Registry prides itself on achieving its status as the number one foreign flag in the Greek market, second only to the Greek flag in terms of tonnage capacity.
In terms of international presence and services provided, which have been the main initiatives from Marshall Islands Registry this past year?
International Registries, Inc. and its affiliates (IRI) provide administrative and technical support to the RMI Maritime and Corporate Registries. IRI’s main initiative continues to be providing timely quality service to its clients through qualified personnel with experience at sea and ashore. With the largest network among any registry, IRI has 26 full-service offices with the ability to handle all types of ship registry, marine safety, and technical support services. In 2014, IRI expanded its London office to a second floor, and opened a second office in Hong Kong for the purpose of processing seafarer documentation and providing further maritime service in the region. By continuing to strengthen its team worldwide, IRI ensures a high level of service and continuous improvement to the decentralization of Registry related services for the increasing number of RMI flagged vessels. IRI’s global staff is available to respond to inquiries regarding RMI maritime matters on a 24-hour basis. IRI strives to ensure consistency among its network of 26 worldwide offices in terms of registration and ongoing technical and operational support and aims to simplify procedures so that documentation is processed swiftly.
Given that new shipping regulations are constantly implemented around the world, which would you highlight as the most significant ones for ship owners over the past few months? How do you expect them to affect the shipping business?
The RMI is an active member at the International Maritime Organization (IMO), and continues to play a significant role in the shaping of future regulations, particularly in the areas of ship, crew, and environmental safety and security. The primary responsibility of the RMI Registry’s Technical Department is to oversee the implementation of the applicable national maritime laws and to ensure that the IMO codes and conventions are carried out to the fullest extent practicable on RMI Registry vessels. Of great importance is the adoption of the International Code for Ships Operating in Polar Waters (Polar Code), which covers the design, construction, equipment, operation, training, search and rescue, and environmental protection matters relevant to ships operating in the harsh waters of the Arctic and Antarctic. The Polar Code highlights the potential hazards of operating in polar regions, including ice and rapidly changing and severe weather conditions, and provides goals and functional requirements for ship preparation and operation in these remote areas. It is expected to enter into force on 1 January 2017 and will be enforced on both new and existing ships.
Another important issue for the Maritime Safety Committee (MSC) is the draft International Code of Safety for Ships using Gases or other Low-flashpoint Fuels (IGF Code). Its adoption is anticipated to be at MSC 95, scheduled to be held in June 2015. The IGF Code will provide mandatory provisions for the arrangement, installation, control, and monitoring of machinery, equipment, and systems using low-flashpoint fuels, focusing initially on liquefied natural gas (LNG), to minimize the risk to the ship, its crew, and the environment, with regard to the nature of the fuels involved.
Given the new ECA Zones which have already started operating, do you see any major problems in fuel procurement?
ECA compliant marine fuels are available in two forms. Low viscosity distillate Marine Gas Oil (MGO) is readily available; however, it is more expensive than conventional heavy fuel oil (HFO). Problems with loss of power have been experienced during the changeover to MGO when entering the ECA. Special lubricants are required and MGO may not meet the fuel specifications recommended by engine manufacturers. As an alternative, efforts have been made to develop a high viscosity ultra-low sulfur HFO meeting the ECA requirements. Although these fuels are potentially less expensive than MGO, they are not readily available. While meeting the engine manufacturer’s recommendations, they cannot be mixed with conventional HFO. The recent drop in oil prices overshadows the costs of fuels for ECA compliance, making MGO the preferred fuel in the short term. Operators have been gaining experience on fuel change over procedures when using MGO which will hopefully reduce safety issues resulting from these new requirements.
Will the Ballast Water Management Convention be implemented during 2015? If so, how will this affect global shipping in your opinion?
The International Convention for the Control and Management of Ships’ Ballast Water and Sediments (BWM Convention) was adopted by consensus by the IMO in London in February 2004. Its entry into force will be 12 months after ratification by 30 Member States representing 35% of the world merchant shipping tonnage. Most recently, Georgia has ratified the BWM Convention, bringing the total number of ratifications to 44 States and 32.57% of the world tonnage. If the tonnage criteria are met sometime during 2015, the BWM Convention will enter into force sometime in 2016.
These days, a registry’s quality is among the main parameters for its success. How does Marshall Islands fare in this area?
IRI has proven itself capable of simplifying procedures so that documentation is processed swiftly. One of these procedures is the RMI Registry’s efficient vetting process for ships entering and remaining in the RMI. The pre-registration screening process for every vessel and operator gets transferred to the point scoring system for fleet assessment once a vessel enters the RMI Registry. This data is then reviewed by fleet operations personnel on a monthly basis, which is one way the RMI Registry is able to maintain its quality fleet. The RMI has received the highest ratings in port State control (PSC) international rankings. The RMI is the only major open registry to be included on the White Lists of both the Paris and Tokyo Memorandums of Understanding (MoUs) and has maintained Qualship 21 status with the US Coast Guard for ten consecutive years, which is unprecedented. Also, all commercial vessels under the RMI flag are subject to an annual safety inspection, conducted by either Registry personnel or an authorized nautical inspector. The considerable growth of the RMI fleet, while at the same time maintaining quality and swift service, continues to enhance the RMI Registry’s reputation.
IRI believes the success of the RMI Registry is due to its qualified personnel, with experience at sea and ashore, who focus on quality, service, and continual improvement. The most important asset to the Registry is its customers and IRI strives to provide them with full service from any office, 24-hours a day. The number of IRI staff outside of the US has surpassed those in the US. By continuing to strengthen its team worldwide, IRI ensures a high level of service and continuous improvement to the decentralization of registry related services for the increasing number of RMI flagged vessels. As the largest network among any registry, each of IRI’s 26 full-service offices has the ability to register a vessel, including those under construction, record a mortgage or financing charter, and service clientele. IRI prides itself on providing reliable and prompt service to international business clients, legal and financial professionals, and shipowners and operators.
Nikos Roussanoglou, Hellenic Shipping News Worldwide