Marine engineering is perhaps one of the less-talked-about engineering categories. However, that does not mean it does not exist. A lot of people may think that marine engineering isn’t as important or common as some other engineering categories. Well, they are obviously wrong!
Marine engineering has played many vital and substantial roles across many sectors. We are here to enlighten you on what marine engineering is, and what it is for. Read on to find out what it is.
Why You Need Marine Engineers
Marine engineers are people who make and repair boats, underwater crafts, offshore platforms, and drilling equipment. They also design, build, and test ships, boats, and other marine entities.
At the same time, it is normal for them to work closely with naval architects to design small yachts, fishing boats, submarines, and aircraft carriers.
They may sometimes even have to work closely with ocean engineers. In quick summary, marine engineering is a lot like ocean engineering, but with a mix of other engineering types. It is a combination of classical engineering types like civil engineering, mechanical engineering, and electrical engineering. What separates marine engineers is their ability to solve complicated problems. These include hydrodynamics, marine acoustics, offshore engineering, marine robotics and naval architecture.
TKR Engineering’s Mini-Guide to Getting The Best Container Rental Services
Images via Pixabay
Most leading container shipping lines have their global network of services connecting some of the major international trade routes. They own sizeable fleet of containers of their own to meet their global business needs. However, it is neither practically acceptable nor cost-effective to maintain 100% own containers to do business for shipping purposes. Many shipping companies ensure pliability and the quickest access to container units in the anticipated location at the right time on demand. As such, many shipping companies prefer to keep a blend of owned and leased container that is available to them at that point in time.
The carriers may face a state of affairs where they have a shortage of containers at some locations or they may have a need of certain types of containers (Flat Racks, Open Tops, high cube GP 45ft/48ft etc) at other locations. The necessity to ensure the availability of container units as and when required is the leading consideration for many shipping companies to go for leasing. Having said that, leasing may be a suitable choice for the carriers to avoid the costs and problem of re-positioning their own units and also capital investment in container rental service. To respond to the unpredictable and multifaceted shipping market conditions, many company rental services try to maintain their own container stock in the range of 40% to 60% out of their clients’ total container fleet.
In all honesty, leasing is approximately 60 to 70% more expensive compared to ownership from an operational point of view. On the other hand, the size of container fleet handled by the pioneer Leasing companies like Textainer, Pacific Tycoon, CAI International, Triton, Florens, and among others, show their growing market share in the container leasing business internationally. This is because of the comparative business advantage of different lease choices provided by the world-class container rental service companies. Statistics show that in 2019, container rental service companies owned approximately 41% of the global container fleet. The remaining 59% are under the ownership of ocean carriers and other transport operatives.
Different Kinds of Container Rental Services
There are several kinds of container rental services. Here are the few main ones.
Master lease agreement is exclusive among the leasing choices as it permits a great amount of flexibility to the shipping line or other renters. A master lease is designed for a range of containers (maximum and minimum), the duration of the term is flexible (usually short to medium). Furthermore, the collection and return locations are generally more flexible and based on credits.
The leasing company is accountable for the full management of the container fleet (maintenance and repair) and for re-positioning following off-hire and contract conclusion. Under this agreement, the container rental service company acts as a logistics service provider as it has to allocate the distribution of its container assets in line with the container service renters’ transport strategies. This type of agreement permits full flexibility with respects to the location of the containers and as such helps the shipping line to plan and estimate their costs accordingly.
Long Term Lease
Long term rent (sometimes referred to as dry lease), is implemented for longer periods of time which varies between 5 to 8 years. The duration of the lease is equivalent to about 1/2 of the useful life of a container. Unlike a master lease, it does not include any management service by the container renting company. Long term leasing comes with a fixed number of containers and has a predetermined re-delivery timetable. Under this agreement, the container renter is responsible for all kinds of management of the containers during the contractual period. This includes maintenance and repairs and re-positioning. At the end of the schedule, the container renter can either renegotiate the terms for the lease’s extension or deliver the container to an agreed location.
Short Term Lease
Short term container renting (sometimes referred to as ad hoc or spot lease) is generally related with the renter’s temporary need for equipment. Its time frame may be for one way or round-trip service of a vessel. The prearrangement normally takes place when there is a provisional surge in demand either cyclical or unforeseen. Container rental service companies try to avoid having a large share of their equipment on the spot market as container rental fees are unpredictable and strongly influenced by the current global market conditions. During low demand periods, the risk exposure of short-term lease is high due to expected increase in the capacity of indolent equipment. The renter is responsible for re-positioning and repair of the equipment.
Container shipping companies need to build up a container inventory having a suitable blend of owned and leased containers which can help maximize utilization of the equipment for fulfilment of its growing business obligation. At the same time container units to be hired under a combined policy of master lease and long-term lease to get optimal flexibility for maximum utilization of the units as per the business plan of the container rental company.
Images via Pixabay
Container Rental Services is definitely an important aspect when you are looking to transport items long-range by sea. If you ever need such services, do not hesitate to contact us. We are willing to accommodate your container rental service needs accordingly.
Everyone knows that the oil and gas sector tend to be volatile. Its pricing is no different. We will often hear of the oil and gas sector staffs getting laid off. Or how the prices plunge to an all-time low. It’s volatile just like that.
Regardless of whichever industries, it tends to pick up. That is no exception to the oil and gas industry.
The novel Coronavirus has some hand in crashing the already-drowning oil prices. It has weakened not just the ever-tardy world economy, but it’ll certainly impact countries where they largely rely on oil and gas exports.
Oil and gas price has been running for less than US$100 per barrel since last year. As of 1 January 2020, this year gas price per litre only costs US$67.05. After the Coronavirus outbreak, prices dropped dramatically to US$30 per barrel. At one point it has even plunged to below US$0 per barrel. Imagine the huge loss the majority of oil and gas sectors and countries have suffered just from this.
Demand Shock Curtailed From The Oil and Gas Sector
Images via Pixabay
To make matters worse, countries running on an oil and gas-dependent industry are also living a demand shock. Already at the beginning of the year, there were signs of an oil surplus – excess capacity in comparison to slower demand growth.
After the Covid-19 outbreak, the situation only worsens. The International Energy Agency estimates that, for the first time since 2009, the oil demand will fall compared to the previous year.
The Covid-19 has been showing to be not just highly contagious for human health, but also to the globalized economy. Countries and firms are reacting to the virus by quarantining people, getting staffs to work from home, cancelling events, among other things. These decisions are a direct hit to the transportation sector – which is the most oil intensive.
Approximately 29% of all energy consumption is used by the transportation sector and almost all of it (about 96%) comes from oil. The longer the virus is among people and social distancing measures are adopted, then oil price will still see an all-time low. It is one of the greatest impacts as a key consuming sector of the oil industry.
Helima Croft, global head of commodity strategy at RBC Capital Markets, talks about excess oil and gas storages in North America. She suggests keeping an eye on global oil and gas demands:
This is a really sort of interesting, unique story to the oil market. I mean, what has been hit the hardest by this pandemic has been vehicle traffic use. I mean, people are not flying. They are not driving. And so, this is a real story about storage filling up. … We’re expecting Cushing to reach tank tops by mid-May. I mean, there are other places that you can store this crude, potentially in, like, Louisiana, but until we get signs that U.S. gasoline demand is improving, that people are going to drive again, we are continuing to be very, very bearish on the demand outlook for oil. Now, there was this OPEC cut last week, this historic cut. There was a lot of focus on that. And that’s really sort of turning off the tap in the bathtub that’s overflowing, and so the situation would be far worse. But the problem is those cuts don’t take effect until May 1. There is still a lot of crude that is on the water right now that is going to refineries that do not need it. And so that is the challenge right now: Those OPEC cuts are not coming until May, a ton of crude on the water and demand continuing to collapse.
At the same time, Jonathan Golub, chief U.S. equity strategist for Credit Suisse, cautioned that some of the action-driving oil prices below zero were unreasonable:
There are some technical things going on with the futures contracts because they’re expiring and rolling over tomorrow, which makes this a little bit of an unreasonable read. If you look out further into the June contract or even the contracts that go out a year, they’re off, but they’re not off nearly as much. My concern, though, is that in general, lower oil — it’s not only about the energy sector, which is small, but it’s the impact that this is going to have on credit and banks and other sectors that lose money when these energy companies can’t pay their loans.
Will Oil Price Ever Recover? What Does That Mean For Malaysia?
Optimistically yes, but we should not raise our hopes. According to Bridget Welsh and Calvin Cheng, oil and gas price has been in deficit for the last few years. Even if it did raise, it does not mean it will reach beyond deficit numbers.
Table credits to Bridget Welsh and Calvin Cheng. The same table can be seen on Malaysia Kini.
Perfecting Existing Problems
As a small producer and consumer of oil and gas, Malaysia has limited control to take on shifts in the oil and gas sector. It can be pro-active in using this crisis as an opportunity to re-equilibrate its economy, strengthen revenues, build stronger political cooperation over managing oil and gas, and offset the negative effects of the global pandemic and economic slowdown.
Malaysia Kini has offered three concrete suggestions for Malaysia to move forward:
1. Improve governance:Strengthen Petronas’ management by supporting leadership decisions that improves its capacity to be able to tackle economic difficulties ahead. A critical component of this is to improve Petronas’ transparency and public accountability. At the same time, it’s good for the entity to increase the professional oversight over the management of political funds beyond what the prime minister has to provide. It is significant to bring in more non-partisan professionals into oversight.
2. Increase engagement with stakeholders:Reach out to the states and vicinities that are in the front line of the negative effects of a contraction in oil and gas, assuring that they are appreciated stakeholders in the economic recovery process and will also receive their fair share of available profits. Using oil-related funds as a political tool will only escalate tensions and splinter politics further. Given the high level of poverty and tenacious infrastructure needs in the states with oil and gas, there has to be more presence and fairness in revenue distribution.
The federal government should evocatively engage in dialogue and consultations and respect all state governments to prevent further undercutting the economy and assuring political stability to manage continuing headwinds. Given the fractious nature of politics at both the federal and state level, it is vital to have broad discussions on deals made to include the opposition and public, as segregation will inevitably only serve to disseminate tensions over oil revenues.
3. Enhance revenue sustainability:To strengthen government revenues and reduce dependence on oil-related revenues including Petronas, the government needs to consider new procedures and revamp its fiscal system. Revenue sustainability strategies will ultimately pivot on broadening the tax base through increasing tax compliance, while increasing the coverage of existing indirect taxes. New kinds of taxes on capital gains, wealth, or the restoration of a consumption tax may eventually need to be considered – all keeping in mind that the recovery ahead for businesses and workers will be exciting and takes arduous time.
With all that being said, the oil and gas industry may see an increase in its price. However, do not expect to see it going beyond its sluggish deficits anytime soon.
News Rehashed From:
CNBC, Malaysia Kini, Asia School of Business, Deloitte Report, and PR Newswire.
Shipbreaking is one of the most dangerous jobs in the world, according to the International Labor Organization. Shipbreaking is the process of breaking up huge old ships into spare parts. It almost always happens in developing countries and comes with an excessively high level of fatalities, injuries and work-related diseases.
In November 2016, 17 people were killed in a series of explosions on an oil tanker at a shipbreaking yard in Gadani, Pakistan. In 2019 alone, it was reported that 26 shipbreakers died in Bangladesh. This is an industry that can be improved to be so much safer.
Images via Pixabay
The process of shipbreaking is useful as much as it is important. After 30 years, a ship’s structural strength deteriorates and becomes unprofitable to repair and maintain. That being said, it’s good to extract any valuable materials like steel, iron, aluminium, and plastics, for any necessary recycling. Recycling it is a lot better than letting the ship sink or abandonment. It’s also economical too.
The majority of end-life ships are dismantled and sold to South Asian countries of India, Bangladesh, and Pakistan. In recent years, it’s common to see it in West African countries of Nigeria and Ghana. It is said that in those countries, ship-recycling is especially a lucrative industry. It supports many livelihoods and serves as a source of raw materials for local industries.
One person in Lagos, Nigeria we interviewed as part of our academic research on shipbreaking told us that “local youths scavenge for heavy metals such as copper, brass and bronze from the ships (especially the propeller)”. He claimed the propeller alone could fetch as much as £40,000. In Bangladesh, it is estimated that about 36,000 people are employed in shipbreaking, and half of the country’s total steel is salvaged from dismantled ships.
Impact on Societies and Environment
Images via Pixabay
It has become very clear that when these ships reach the end of their lives, they pose a threat to people and the ship’s environment. A 2010 World Bankreport says that by 2030 Bangladesh and Pakistan would have accumulated millions of tonnes of hazardous waste from shipbreaking.
This would include 85,000 tonnes of asbestos, 256,000 tonnes of hazardous chemicals known as PCBs, mainly from cables, 225,000 tonnes of ozone-depleting substances, 75,000 tonnes of paints containing heavy metals and toxins, 720 tonnes of heavy metals, nearly 2.2 million cubic metres of liquid organic waste and over a million tonnes of other hazardous wastes. Similar studies have also shown shipbreaking pollutes its surrounding sediment and seawater, harming nearby marine life and risking the livelihoods of fishermen.
Despite the many benefits of shipbreaking, the human and environmental costs mean people need something more sustainable. This is what Olalekan Adekola (Geography lecturer from York St John University) and Md Jahir Rizvi (Mechanical and Marine Engineering lecturer from Plymouth University) investigated in their academic research throughout late 2018 and 2019.
Part of the problem is how companies are avoiding regulations. According to the NGO Shipbreaking Platform, in 2017, about 80% of the world’s end-of-life tonnage was broken under rudimentary conditions on the beaches of Alang in India, Chittagong in Bangladesh and Gadani in Pakistan.
As pointed out by someone we interviewed in our research, these ships often end up in a developing country after being brought there under the guise of being operational but with the intention of being scrapped. By doing this, many shipping firms from developed countries especially in Europe can evade environmental and workplace legislation at home. But while there are established challenges like this, dangerous shipbreaking is also very much a design issue.
Pushing for Sustainable Ship Recycling
Images via Pixabay
In Olalekan Adekola and Md Jahir Rizvi’s new study, they review the existing methods that are currently used by shipbreaking yards. They found that none were completely effective at controlling the spread of hazardous materials.
For example, “beaching” is the most popular technique, as it takes advantage of natural beaches with high tidal zones and long mudflats and as such that needs minimal additional infrastructure. The ship is first anchored just offshore where easily removable items are taken away to make it as light as possible. Then during high tide, the ship is shifted to the mudflat where it is fully broken down. As beaching contaminates the mudflats and the surrounding environments, it is not considered environmentally friendly.
They have instead come up with a sustainable and environmentally-friendly process, one that shipbreakers in developing countries can implement without sustaining any significant costs. Both Olalekan Adekola and Md Jahir Rizvi propose performing the entire shipbreaking process on a specially constructed bed rather than a muddy surface.
The bed will be made of 4 layers, using concrete materials, pebbles and sand. As each layer will have a different level of porosity and the ability to regulate how materials pass through it. Hazardous materials and wastes will be trapped effectively and not be able to reach the base of the bed – or flow into the sea.
Their modelling reflects that this will restrict the concentration of hazardous materials and minimize or even eliminate the chances of these materials contaminating the surrounding environment. At the same time, their proposed approach is sustainable on 3 levels:
It protects the environment
Allows shipbreaking activities to continue benefiting livelihoods and reduces resource extraction
Uses mostly natural materials that are readily available, affordable and reusable
They equally recognize institutional challenges. Among their proposals are an international operational framework for shipbreaking, and extending the idea of extended producer responsibility to ship makers and shipping companies. This means they will (and should) be responsible for after-sale waste, as is sometimes the case with electronic waste.
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.