forum_2001_02

T H E C O R P O R AT E M A G A Z I N E O F D E T N O R S K E V E R I TA S N O . 2 / 2 0 0 1

FOCUS ON

bulk carrier safety

ALSO INSIDE:

KNPC raises the safety bar

Blue Stream: the world’sdeepest pipeline

Safety first at Virgin Trains

Korea heads the newbuildingleague

Leading executives call for

improved newbuilding standards

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RaisiR

Raising s

CONTENTS

DNV Forum is the corporatemagazine of Det Norske Veritas

PUBLISHED BYCorporate CommunicationsN-1322 Høvik, NorwayTel: +47 67 57 99 00Fax: +47 67 57 91 60

HEAD OF CORPORATECOMMUNICATIONSTore Høifødt

EDITORStuart Brewer

EDITORIAL CONSULTANTR.Keith Evans

ADMINISTRATIONGro Huseby

DESIGNDNVE Graphic Communications

PRINTGan Grafisk, Norway

No responsibility is accepted bythe publishers for statements madeby authors, nor for attributablecomment. Reproduction permittedwith acknowledgement of source.

© Det Norske Veritas 2001

Det Norske Veritas is anindependent, autonomousFoundation working to safeguardlife, property and the environment.Det Norske Veritas comprises 300offices in 100 countries, with 5,500employees.

Visit our website www.dnv.com

page 16page 6 page 26

3 EDITORIAL: Raising safety standardsin shipping and in industry

4 BULK CARRIER SAFETYThree industry leaders speak outArthur Bowring, Hong Kong Shipowners’ Assocn:‘Ensure fitness for purpose’

6 Frederick Tsao, Intercargo:‘Shipping industry must unite’

8 Peter Cremers of ISMA: ‘Class must act impartially’

10 BLUE STREAM: Russian and Italian engineersconquer the depths of the Black Sea

13 VIRGIN TRAINS promises world-class rail travelby 2003

16 GOLDEN VALE confirms that good safetymanagement shows ‘on the bottom line’

18 KUWAIT: KNPC takes safety management to new lengths

22 SOUTH KOREA heads the world’s newbuildingleague

24 ROYAL AUSTRALIAN NAVY:DNV helps sharpen the cutting edge

26 CRUDE OIL ACROSS ALASKAa new safety challenge for Alyeska

28 ISO 14001 helps BP’s environmental driveon Alaska’s North Slope

30 LENVIK PRAWNS safely feed the European gourmet... thanks to BRC certification

32 NEWS

34 LAST WORD

35 DNV WORLDWIDE

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EDITORIAL

Although safety has very much become part and par-cel of today’s ‘quality and standard fashion’, its pur-suit is as old as the shipping industry itself. A ship’sseaworthiness or fitness to be put to sea safely hasalways been of paramount importance in any shipoperation aimed at achieving long-term profitability.Moreover, despite the publicity given to bad acci-dents, ships have become progressively safer, thanksto both technical and human improvements.

Nonetheless, as recent cases show, parts of the indus-try continue to struggle with basic safety require-ments, such as preventing bulk carriers from suc-cumbing to sudden, catastrophic structural failure.Indeed, structural failure continues to cause the lossof many bulk carriers – 14 in the past year alone –which leads to the question: do standards for bulkcarrier construction, operation and inspectionrequire further strengthening, or is the system itselfin need of a complete overhaul?

DNV senior vice president and corporate marketingmanager for bulk carriers, Hans Viig, is in no doubt:‘The problem of bulk carrier losses is exacerbated asshipyards become “creative” in interpreting classrules, particularly when building new standard-typebulkers. To help combat this situation, the Inter-national Association of Classification Societies needs

to introduce a minimum standard for bulk carriers tomake them suitable for their intended cargoes and,in turn, make the industry safer for the ship andcargo owners, crews and the environment.’

His views are echoed by three leading and influentialshipping executives who, in this issue of DNV Forum,explain what they believe is the problem and how itshould be addressed – views that will be of interest toa wide cross-section of the maritime industry.

This issue of DNV Forum also addresses safety issues inother industries served by DNV. The Kuwait NationalPetroleum Company recently experienced a series ofincidents at two of its refineries and, as a result,turned to DNV to develop and implement an inte-grated management system to help improve its safetyand operational performance. Britain’s train operatorVirgin Trains, Golden Vale Dairies, and the Russian/Italian pipeline operator Blue Stream are all similarlyfocusing on safety issues in their respective industries.There is no doubt that land-based industries, as wellas the maritime and offshore world, are making gooduse of DNV’s wide cross-discipline safety expertise.

[email protected] EDITOR

Raising safety standards

DNV FORUM NO. 2/2001 3

Hans Viig

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COVER STORY

IIt is less than two years after the InternationalMaritime Organisation (IMO) introduced regula-tions to eradicate the problems of bulk carrier safety.Those rules, however, now appear rather ambiguous,and the problem is exacerbated as shipyards become‘creative’ in interpreting Class Rules.

One example of this is the need to carefully opti-mise cargo placement during loading to fit the allow-able strength, rather than design strength beingbased on expected loading conditions. This is thereason why some new bulk carriers, which appear tobe fully classed, lack the ability to load certain car-goes.

Citing ‘vicious circles of intense competition inwhich shipyards, classification societies and shipown-ers find themselves’, Bowring believes the way for-ward is to impose a ‘common minimum standard sothat ships on delivery are “fit for purpose” and ableto carry all common cargoes in unrestricted world-wide trade with a common design life’.

FITNESS FOR PURPOSESays Bowring: ‘We recently met representatives of theInternational Association of Classification Societies(IACS) to discuss our Technical Sub-Committee BulkCarrier Initiative. During the meeting, we spentsome time explaining our concept of a ship being“fit for purpose”. This is a philosophy rather than atechnical specification, and therefore quite difficultto grasp. What it comes down to is whether the bulk

Arthur Bowring, HKSOA chief:

We must ensure bulk carriersare fit for their task

Arthur Bowring has often commented on broad yetimportant issues facing the shipping industry. Here hevoices his concerns over the design of bulk carriers,which he feels are not always ‘fit for purpose’ whendelivered.

TEXT: [email protected]

Bulk concerns: ‘The shipowner wants ships that aredesigned and classed for worldwide trading with car-goes that would normally be carried in any bulk carrier,not ships that are designed and classed for limited andspecific conditions in a loading manual,’ says HKSOAdirector Arthur Bowring.

4 DNV FORUM NO. 2/2001

In our forum for discussing important issues facing the maritime industry, Arthur

Bowring, director of the Hong Kong Shipowners’ Association (HKSOA), Frederick Tsao,

chairman of Intercargo, and Peter Cremers, president of the International Ship

Managers’ Association (ISMA), give their views on issues concerning bulk carrier safety

and what is perceived to be a general decline in newbuilding standards.

Forum.qxd 03.09.01 22:55 Page 6

carriers that have been built and are still being builtare suitable for their intended trade.’

In its meeting with IACS, the HKSOA’s TechnicalSub-Committee members highlighted some recentexamples where they felt designs were deficient andhow the design might have been different had theoverall philosophy of being ‘fit for purpose’ been theguiding light. Bowring explains: ‘Our commentswere related to the more frequent case of standarddesigns, such as bulk carriers, rather than one-off

specialised ship designs. We have many examples,especially of the larger bulk carriers delivered nowa-days, that are optimised to such an extent that theirtrading can be severely limited. But this is not gener-ally clear when the ship is ordered, nor from the pre-delivery specification. Often it is discovered onlyafter delivery when the crew tries to load certain car-goes in certain sequences.’

However, Bowring agrees that if shipowners in thebulk trades are to have any real chance of remainingcompetitive, they have to ‘buy cheap’. This meanstaking shipyards’ standard designs, since any changein specification will boost the price tremendously.

‘Take, for example, the trade of a Capesize orPanamax bulk carrier, which is fairly uncomplicated.There are only a few commodities that are carriedon these ships, and these vessels usually trade world-wide to any port that can take them. But the new-building yard will never supply more than theabsolute minimum, since most faults will not showduring the 12-month guarantee period and there isalmost no collection of data by the industry thatwould identify shipyards that routinely build shipswith faults.’

EXTENDED GUARANTEES?The HKSOA is now placing pressure on IACS tointroduce a minimum unified standard. The goal isfor these bulk carriers to be suitable for their intend-ed cargoes – or ‘fit for purpose’. Says Bowring:‘We are not alone in our concerns. Some ownersare now calling for extended guarantees for new-buildings. Marc Saverys, MD of CMB, was recentlyreported in Fairplay to have asked why a shipyardonly gave owners a one-year guarantee while thesame company could offer a six-year warranty on carsthat it built. John Lyras, president of the Union ofGreek Shipowners, has also complained aboutmodern construction quality. He recently called forminimum class standards to meet a 25-year, commer-cially viable life expectancy without major steelreplacement.’

Hans Viig, senior vice president of DNV and anearly supporter of HKSOA’s initiative, gave a paper atthe recent Intercargo AGM in Rome to discusswhether bulk carriers are really fit for their mission.Says Viig, ‘DNV has long held the view that manystandard bulk carriers offered and delivered bymajor shipbuilders are not really fit for a lifetimemission as general-purpose vessels. Experience showsthat design criteria are usually minimal or “opti-mised” so that ships can be sold for the lowest possi-ble price. Some owners are happy with lower-cost ves-sels for a specific trade. However, we are concernedthat the vessels will be sold to owners that will usethem for a wide range of cargoes for which they arenot suited. This, of course, could have serious impli-cations for the ship and cargo owners, not to men-tion the risk to human life and the environment.’

Concludes Bowring: ‘It is clear that our initiative isone part of an industry reaction to the continuingdeclining standards of newbuilding, especially series-built, construction. The fact that IACS has recentlyreconvened its bulk carrier safety steering committeeis encouraging and will help address the questionsthat have been raised.’ ◆


COVER STORY

‘Some large bulk carriers are so “optimised” that their

trading can be severely limited’

IN SUMMARY:

• Fierce competition between shipbuilding

nations has led to individual shipyards

looking to design factors to save costs

when building bulk carriers.

• The issue has returned to the forefront less

than two years after the IMO introduced

regulations to eradicate the problems of

bulk carrier safety.

• The Hong Kong Shipowners’ Association

has initiated talks with IACS to introduce a

minimum unified standard for bulk carriers

to make them suitable for their intended

cargoes or ‘fit for purpose’.

• This initiative, supported by DNV, is gain-

ing the support of other industry bodies,

including Intercargo, ISMA, the Union of

Greek Shipowners and the Norwegian

Shipowners’ Association.

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COVER STORY

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EExpressing Intercargo’s support for unified, mini-mum bulk carrier standards, its chairman and presi-dent, Frederick Tsao, tells DNV Forum: ‘It is time thatall parties in the maritime industry moved forward inharmony to achieve the ultimate goal, the elimina-tion of bulk carrier casualties due to structural fail-ure. If the occurrence of such tragic accidents is tobe prevented, what we need is not confrontation butco-operation.’

Last year alone 14 bulk carriers were lost, with 23fatalities; the average age of the ships was 20.4 years.Explains Tsao, ‘Structural failure remains a consis-tent and significant cause of loss, while the presenceof heavy cargoes features in many of the losses.Hence we are calling for an assessment of minimumshipbuilding standards, arguing that many standardbulk carrier designs have become too optimised.’

MINIMUM DESIGN STANDARDS‘We are alive to the problem that yard specificationsare generally too low for many bulk carriers, and ourExecutive Committee strongly supports the call bythe Hong Kong Shipowners’ Association (HKSOA)for a common minimum bulk carrier design stan-dard.’

Tsao acknowledges that a higher building specifi-cation will normally result in increased prices, andemphasises that overcapacity in the shipbuildingindustry worldwide is giving rise to severe competi-tion – not only between shipbuilders and suppliersbut also between shipowners – which is having a neg-ative impact on the market.

‘As an industry, we are subject to a vicious circle ofendless cost-cutting. A typical example is the way that

cost pressure forces shipowners to press for lowershipbuilding prices. The shipyards respond by refin-ing their safety margins, through exerting pressureon classification societies.’

KEEPING THE BALANCETsao concedes that classification societies and regu-lating authorities face a complex situation when try-ing to improve bulk carrier safety. He believes indus-try bodies need to develop their own initiatives, as in

the case of the HKSOA, but stresses the importanceof ‘working collectively and speaking with one voice’.Over the past two years, Intercargo has implementeda number of programmes, including the setting upof Asian and European panels to discuss issues inthese regions. Various roundtable meetings and dia-logue sessions have also been held in order to shareindustry experiences.

Tsao continues, ‘Through the Asian panel, we arealready talking to shipyards and classification societiesto share with them our concerns. We want them toadopt clear criteria for ship design that take intoaccount safety, environmental, manning and structur-al issues. This will enable a more holistic approach toship design and will move us closer to the ideal shipforms. It will still allow for robust competition withoutthe lowering of technical standards.’ ◆

Intercargo, the representative body ofthe international dry-bulk shippingsector, is calling for unity in the ship-ping industry over the issue of bulkcarrier safety.

TEXT: [email protected]: KIM LARSEN

Frederick Tsao, chairman of Intercargo:

Balancing safety with lifetime costs

‘The industry is subject toa vicious circle of endless

cost-cutting’

COVER STORY


Forum.qxd 03.09.01 22:56 Page 9

To discover the reason for the general decline in newbuildingstandards, just examine the bottom line. Peter Cremers, pres-ident of the International Ship Managers’ Association (ISMA)is purposefully blunt in his assessment of the situation:

‘Owners build where they canget the cheapest ships possi-ble.’ New regional loyaltiesand sentiments have littleclout in the discussion ofwhere to build. ‘Most yardsdeliver good quality, but someare cutting corners,’ lamentsCremers, concluding that ‘Classmust be prepared to act force-fully when it has identified aclear shortcoming in safetystandards.’

Peter Cremers, president of ISMA:

Class must act impartially


ISMA president Peter Cremers: ‘Either Classacts to reduce bulk carrier risks, or we shallsee yet more government regulation.’

COVER STORY


Forum.qxd 03.09.01 22:56 Page 10

A


As president of ISMA and chairman of Hong Kong-based Anglo-Eastern Shipmanagement, PeterCremers is well qualified to assess bulk carrier safetyissues. He insists that Class, as the impartial arbiter ofeffective marine safety standards, must respond toreduce the risks inherent in many newbuildings.

Among the items he suggests concerned ownerspursue is greater accountability by both yards andclassification societies. ‘The quality of ships turnedout at some yards is a matter of grave concern to theindustry. The problem is exacerbated through yards(and Class for that matter) bearing virtually noresponsibility for the quality of their products. The12-month guarantee they give is less than that for akitchen toaster. Even when design problems in, say,one of a series of vessels is discovered, the yard is notobliged to inform the other series owners about theproblem – something which is normal practice inother industries.’

‘CONFIDENTIALITY’ CAN HIDE THE TRUTHCremers believes transparency is vital to achievingenhanced levels of safety, and an important tool to‘control the under-performers’. He also questionsthe practice of ‘confidentiality’ between a shipyardand class to the exclusion of the shipowner. Eventhough specifications for standard vessels remain thedomain of the yards, Cremers feels a closer dialogueis required so that owners can communicate theirneeds to the yards. He believes three-way contractscould be the solution.

Commenting on the Hong Kong Shipowners’Association’s initiative to place pressure on theInternational Association of Classification Societies(IACS) to introduce a minimum unified standard,Cremers says: ‘We support this initiative and have,in fact, been pushing for this for some time. TheHKSOA’s initiative serves as the latest evidence ofsupport for our position on this issue.’

One of the items that particularly concernsCremers is that ship-classification notations shouldbe negative, not positive. ‘This means that the nota-tion “Bulk Carrier” should describe a ship that is“fit for purpose”, meaning able to carry any normal

cargo in any area worldwide and with sufficient toler-ance and strength reserve so that the crew on boardcan load and discharge the ship safely.’ Cremersargues that any restrictions on this should be shownin the class notation rather than as is the case at pres-ent, where ‘only additions to the basic descriptionare shown’.

IACS: TOO GREAT A SELF-INTERESTExplains Cremers: ‘It is my firm belief that IACScontinues to be the most appropriate forum foraddressing the technical aspects of further safetyrequirements. However, some IACS members havebeen accused of being too commercialised and moreinterested in preserving their client base thanperforming the role for which they are established.’

Cremers is insistent that class must respond toreduce the risks faced by these newbuildings. Thealternative, he warns, is ‘further government regula-tion of the industry. Governments are well-inten-tioned, but they are not technical experts.’ ◆

‘Class must be prepared to actforcefully when it has identi-fied a clear shortcoming in

safety standards.’

COVER STORY

Forum.qxd 03.09.01 22:56 Page 11

TThe project to which Russian and Turkish authoritiesgave the go-ahead when they signed an Inter-Governmental Agreement in December 1997 was achallenging one with a clear target – Russia’sGazprom was to transport 16 billion cubic metres ofgas from Russia to Turkey every year.

The only common border between Russia andTurkey runs through the Black Sea – whose depthreaches more than 2,000m. This posed a major chal-lenge that was made even greater due to the fact thatGazprom’s previous experience was mostly related toonshore pipelines, and that no pipelines have everbefore been installed at such water depths.

But the deep waters are only one of the technolog-ical challenges – a steeply sloping seabed with seis-mic activity along both coasts is another. Co-ordinat-ing the project between the parties involved, financ-ing the entire project and coping with the politicalchallenges have also been demanding.

‘But’, says technical director Vladimir Borovik,formerly of Gazprom, ‘if we hadn’t been sure that wecould overcome these challenges, we’d never havestarted on this project. Through an extensive collab-oration with some of the foremost experts from out-side Russia and Turkey, we’ve already put most of thechallenges behind us and we’re well prepared forthose we’re now facing – in actually laying the twopipelines.’

MERGING TO FORM BLUE STREAMThe idea now being realised originated with Russia’sGazprom. While Russia is the largest gas-producingnation in the world, with around 1/3 of all total

Crossing the divide

Early next year, the first gas will flowfrom Russia and under the Black Sea toTurkey. Turkey’s private and industrialconsumers using this gas will beunaware of the problems solved ingetting it to them.


PIPELINE CERTIFICATION

Saipem 7000 will be used to lay the deepest partof the Blue Stream pipelines at a depth of 2,150m.No gas pipeline has ever been laid in such deepwaters. The rig’s J-lay tower is 134 metres high, andwas lowered for the vessel to pass under the twobridges crossing the Bosporus Strait in late August.


Forum.qxd 03.09.01 22:56 Page 12

proven reserves, Gazprom is the largest Russianenergy company. It has over 300,000 employees andoperates more than 140,000 km of gas pipelines.

‘The Russians were the ones who saw the opportu-nities and they contacted us,’ explains Borovik’sItalian counterpart, technical director SalvatoreCaruso of SNAM. SNAM is a subsidiary of Italy’s ENIGroup and deals with the supply, transportation anddistribution of natural gas. ENI’s position in theItalian energy industry is similar to that of Gazpromin Russia. The ENI Group has a total of nearly72,000 employees and is also the largest shareholderin SAIPEM, the company responsible for laying thepipelines.

The two companies – Gazprom and ENI – ownequal shares in their joint venture, Blue StreamPipeline Company BV (BSPC). Both Borovik andCaruso are now employed by this company, with astaff of 20. Once the first gas comes through thepipelines to Turkey, Blue Stream’s staff will be cutback to a minimum. Gazprom will be responsible forregular gas deliveries.

‘That Blue Stream is currently operated by a jointRussian-Italian management team may seem cumber-some and inappropriate,’ comments SalvatoreCaruso. ‘But we’ve found a way of working and col-laborating. In Italy we have a saying – four eyes seebetter than two, and we practise this philosophy inBlue Stream.’

Borovik sees no reason to focus on the company’sinternal organisation and work processes. Instead, heemphasises the practical division of labour – not justbetween the Italians and Russians, but also between

all those involved. ‘In a project worth more than twobillion U.S. dollars, some decisions will be complex.But the way in which Blue Stream is organised hascreated an effective decision-making process.’

THE PROJECT AS A CASE STUDYFinancing Blue Stream has also been a challenge.The Inter-Governmental Agreement entered intobetween the two countries’ authorities, which is ofpolitical significance to both these countries andtheir neighbours and under which Blue Stream hasmany industrial partners, is now used as a case studyat academic conferences.

‘Most of the challenges have been solved by carry-ing out thorough feasibility studies. DNV has beenextremely supportive here and is one of our mostimportant business partners in this project. Riskanalyses have made us aware of the possible risks,’emphasises Borovik’s right hand man, offshore tech-nical manager Andrey Voronov.

The practical division of this project has mainlybeen along the coast of the Black Sea. The Russianshave more experience than anyone else of layingonshore pipelines, and of the intermediate compres-sor stations. The Italians have the necessary offshoreexperience from laying pipelines to their own coun-try from Africa and from participation in inter-national projects.

An example is the Transmed Project, where Italianoffshore technical manager Stefano Dicorrado was in

DNV FORUM NO.2/2001 11


IN SUMMARY:

• Blue Stream is the world’s deepest pipeline

yet constructed, from Russia to Turkey

beneath the Black Sea

• The sponsors, Russia’s Gazprom and SNAM

SpA of Italy, have moved the project

through numerous political and technolog-

ical challenges

• DNV has signed a certification contract

with the owner and operator of the proj-

ect, the Blue Stream Pipeline Company, a

50/50 joint venture between Gazprom and

SNAM

• Offshore installation of the pipeline is

scheduled to start in September 2001.

In a year’s time the pipeline owners

will deliver Russian gas to the shores of

Europe’s fastest growing energy consumer

– Turkey

‘Four eyes see better thantwo, and we practise thisphilosophy in Blue Stream’

Salvatore Caruso

>>

Forum.qxd 03.09.01 22:56 Page 13

charge of following the construction activities. ‘Theunderwater pipelines from Tunis to Italy through theMediterranean Sea at a maximum water depth of 610metres remains – for some more months – a worldrecord for such large diameter sealines.’

TO DNV’S PIPELINE RULESAll four top executives emphasise that DNV’s offshoreexperience has been vital throughout the entire proj-ect, from planning to pipelaying. Says Voronov, ‘TheRussian authorities didn’t have national standards orsets of requirements relating to pipelines in deepwaters. Blue Stream is based in its entirety on DNV’sPipeline Rules. Once this pipeline has been complet-ed, Russian standard requirements will probably beestablished and the experience gained on BlueStream will be incorporated into and help to modifythe original DNV standard.’

Blue Stream will supply 16 billion cubic metres ofgas to Turkish consumers annually. Turkey’s total gasrequirements are expected to increase to approxi-mately 80 billion cubic metres by 2020. The entireEuropean gas market is expanding rapidly, andrestrictions on a free energy market in the EU arebeing lifted. The need for energy, particularly gas,is also expected to grow in the politically unstableMiddle East.

TURKEY THE STRATEGIC BRIDGE‘In the gas market of the future, Turkey may be inthe position of a bridge-builder between three conti-nents,’ forecasts Caruso. ‘It’s no secret that all theparties involved in Blue Stream see these opportuni-

ties and the advantages that this project may thengive. The need for energy will grow and this meansthat the knowledge and experience we’re now gain-ing in Blue Stream will be much sought after.’

Russia in general and Gazprom in particular playan extremely important role in the development ofthe energy market in this part of the world. Around1/3 of the world’s proven gas reserves are in Russia.Gazprom’s gas sales last year amounted to 430 billioncubic metres, around 30% of which were sold toEurope.

Gazprom’s deputy chairman, Sergey Dubinin,offers two examples of projects that may be devel-oped to transport gas out of Russia over the next fewyears: ‘The Yamal-Europe gas pipeline and NorthernEuropean gas pipeline from Russia’s Barents Sea mayconsiderably increase the volume of gas exportedfrom Russia. Feasibility studies being carried out onour northernmost gas field Shtokmanovskoye showthat this field alone may produce 90 billion cubicmetres of gas each year.’

For Blue Stream’s management and business part-ners, this proves that there will be an opportunity toutilise the experience now being gained in Moscow,Milan, on the shores of the Black Sea and, not least,2,150 metres below its surface. ◆

Blue Stream’s top executives. From left:Vladimir Borovik, technical director,Salvatore Caruso, technical director,Stefano Dicorrado, offshore technical manager,Andrey Voronov, offshore technical manager.



Forum.qxd 03.09.01 22:57 Page 14


World-class rail travel by 2003

Virgin Trains aims to be delivering world-classtransport services by 2003. ‘Our company will bethe best in the world,’ says Chris Green, managingdirector of Virgin Trains. The train operator is con-centrating on five main areas in order to achievethis goal: safety, reliability, customer service,product development, and human resources.‘Without safety we should just give up. There isno point in being reliable if we cannot guaranteesafety. There is no point in developing customerservices if we cannot back them up with safety.Britain’s railways have experienced a number ofrecent high-profile accidents, and public concernfor safety has grown.’

TEXT: [email protected]: COURTESY OF VIRGIN TRAINS

>>

RAILWAY SAFETY

Forum.qxd 03.09.01 22:57 Page 15

CChris Green is a voice to be listened to in the Britishrailway industry. He is a railwayman through andthrough, working in the railway business from 1965 to1995, and then coming back to it in 1999. He takes atrain every day to and from his office at London’sEuston station and understands the need for thetrain system to operate well.

‘I travel on a competitor’s train. In that way I getan even better insight into what’s happening in theindustry,’ he says, while underlining that he is happyto be with Virgin. ‘But I think the industry is too frag-mented. Complex relationships exist in the rail indus-try between Railtrack, Virgin, the other rail compa-nies, and the Government’s Railway Inspectorate –everyone has interlocking responsibilities in the areaof safety. Fragmentation makes the safety issues farmore critical, and several recent accidents involvingdifferent companies and management systems con-trolling the trains and track have highlighted this.The biggest concern has been the interfaces between

Railtrack and the train companies, and thethird parties acting as maintenance contrac-tors. It is possible in the future that the trainoperating companies will have to takeresponsibility for maintaining their owninfrastructure.’

STEP CHANGES IN SAFETYMANAGEMENTAs part of its approach to dealing with theseissues, Virgin is working towards making stepchanges in its own safety management sys-tem.

A detailed review of the Virgin safety man-agement system is to be carried out using theRail Operators’ Audit Rating System,ROARS, which will look at areas of major riskfacing Virgin Trains. The assessment willcover such aspects as leadership, communica-tions, organisational structure, policy, plan-ning, management of subcontractors, train-ing, client liaison, incident reporting and fol-

low-up, as well as Virgin’s own audit process. BothVirgin’s West Coast Main Line and Cross Countryroutes will be covered by this review.

Virgin is commissioning Det Norske Veritas to takea look at the company in an international contextand to benchmark it against world best practice.

‘Virgin is aiming for a cultural change in safety:nothing will be accepted as unavoidable,’ statesGreen. ‘Most people in Virgin are committed tomaking a big step forward – detailed safety plans andprocesses are in place and these are now beingwidened to include quality.’

Virgin is using the ROARS system to find out exact-ly where the company lies in terms of safety and qual-ity. With a current score of just five it is merely aver-age. Accidents involving passengers are running atone a day, those involving staff at one every threedays. New rolling stock will help reduce these as allslam doors on coaches will be phased out, new interi-or sliding doors will be installed and TPWS signalling


RAILWAY SAFETY

Virgin’s first Voyager went into service in May.

Forum.qxd 03.09.01 22:57 Page 16

introduced. ‘The biggest problem is Virgin itself,where the need to provide customer service some-times overrides safety,’ Green admits.

NEW TRAINS AND A CHANGE IN CULTUREGreen believes that when safety and quality are right,then train performance and customer service will fol-low. Results will then speak for themselves.

The core company of Richard Branson’s VirginGroup is very much the airline, which is itself drivenby safety and so provides relevant support.

‘We have doubled our emphasis on safety,’ Greenexplains. ‘We use benchmarking, and we are makingreal progress. The most important thing now is to getthat change in culture. We have caught up a long way,but we still have a distance to go. But I believe muchof that will occur when we get our new trains.’

Virgin’s new trains, the Voyagers, have been createdin a partnership between Virgin and manufacturerBombardier, and much was learnt about safety andquality in the process. The first Voyager went intoservice in May, with more to follow soon, while thetilting Pendolino is scheduled to enter service onthe West Coast line in May 2002.

Green is enthusiastic. ‘The new Voyagers are 125mph diesel units; with the first one commissioned inMay, we have started to take delivery of our GBP 1 bil-lion fleet of new trains at a rate of one per week forthe next two years.’

Delivery of the fleet of 140 mph electric Pendolinotrains is not far behind the Voyagers. Now undergo-ing intensive testing, the first Pendolino will enterservice early next year. Both fleets will have virtuallyidentical interiors and will bring radical improve-ments in reliability, speed and comfort. They will be

the first trains in Britain to have audio entertainmentat every seat and they will also boast an onboardshop, sockets for recharging laptops, destination indi-cators in every coach and electronic seat reservation.

‘We are impatient to see the end of the old trains –but we intend to maintain a high quality of service onthe existing trains in the meantime,’ confirms Green.

AN IMPRESSIVE NETWORK – AND A PROFITVirgin Trains operates a comprehensive network,with lines from Aberdeen in the north of Scotland toPenzance in the southwest, from Brighton in thesoutheast to Glasgow in the northwest. 5,500 staffoversee the traffic. Like other parts of the Bransonempire, the train operations have also been able toearn several distinctions. For example, Virgin Trainsreceived four awards in 2000: ‘Train Innovation ofthe Year’, ‘Operator of the Year’, ‘IntegratedTransport Scheme of the Year’, ‘Rail MarketingCampaign of the Year’, plus one from 1999: ‘StationInnovation of the Year’.

Chris Green expects Virgin to make a profit in2002. He is also positive about deregulation of therailways both in the U.K. and in other countries.‘Privatisation has given the railways fresh venturecapital. We can also see great innovations in serviceattitude, marketing and investments in modern stockthat would have been difficult to implement if we hadkept British Rail as a monopoly.’ The HeathrowExpress and the Thames Link are examples of thesenew developments that would not have been possiblewithout deregulation. Today, 26 operating companiesshare the British rail network, five of them majorplayers like Virgin.

‘It is important that when new franchises are award-ed, they are sufficiently long to allow the train compa-nies time to invest,’ concludes Green, who would notsay no to possible subsidising of the railways either.‘The state is building motorways for road traffic. Whyshouldn’t it also build railways for train traffic?’ ◆


‘Virgin is aiming for a culturalchange in safety: nothing willbe accepted as unavoidable.’

Chris Green

RAILWAY SAFETY

‘The need to provide customer service sometimes

overrides safety’

Forum.qxd 03.09.01 22:57 Page 17

Good safety management

shows on the bottom line


‘No fads, no trends, no buzzwords – just good manage-ment directly improving our business results,’ says groupsafety manager Peter Drillingcourt about DNV’s safetymanagement system used at Golden Vale Dairies.


FOOD SAFETY

PPeter Drillingcourt explains: ‘We have an obligationto make sure our employees are safe, and througha systematic approach to safety we also monitor losscontrol and involve all employees and managers inthe process.’

When introducing the system Sexton Cahill,Human Resources Director, challenged GoldenVale’s managers and employees: ‘Try to find oneelement in this system that does not add value to thecompany!’ DNV’s safety management system lookedgood on paper, and after implementing it, some ofthe group’s plants asked permission to go for highersafety levels than planned. Another initiative was todevelop a Safety Improvement Scheme, where prob-lems encountered in daily operations are recordedin a systematic manner and the management ensuresfunding for quick implementing of solutions.

Says Cahill: ‘The positive effects are so obviousthat both employees and managers want to take asmuch advantage of the system as possible, and thepace is adjusted to the individual plant’s needs.’

According to Drillingcourt, the employees nowthink differently about their jobs. The influence overtheir own work and safety is greater, and systemati-cally backed by funding of good initiatives.

PINPOINTING RESPONSIBILITYSexton Cahill explains how it is done: ‘In GoldenVale, the group as a whole is funding the safety work,but we let the individual plants carry their own insur-ance costs. That way, every plant can clearly see thedirect consequences of their safety managementwork – whether it is good or bad. This surely speedsthe process, leading to lower insurance costs.’

DNV’s safety management system has created anawareness of loss control in a broader sense. Forexample, the reduction of lost days at one of theplants speaks for itself: 152 man-days in 1999, 24 in2000 and just one so far this year (July 2001).

Says Peter Drillingcourt: ‘There is a direct connec-tion between a plant’s safety rating and its overallbusiness results. Poor safety management is poormanagement – and vice versa.’

RISK MANAGEMENT AND QUALITYA dairy may not be the most obvious example ofa high-risk business. But Golden Vale is much morethan a dairy. In large-scale production there arealways safety hazards. The industrial blow dryers usedto make powder out of the milk are just one of themost obvious risk factors. Pressure tanks are anotherhazard. Last but not least, the quality of the productsis crucial in the food industry.

New product development and continued investment andresearch are critical to Golden Vale's success.

Forum.qxd 03.09.01 22:57 Page 18

‘Previously there was an ad-hoc approach to safetyissues and there was no systematic reporting of inci-dents and what was being done to avoid them,’ saysCahill. ‘But we could clearly see that our insurancecosts were high and rising. Now everything is trans-parent and measurable. And things are more likelyto be done when they are measured.’

DNV’s uniform and transparent system was chosenbecause it can be implemented in large companieswith a variety of production systems. The methodolo-gy can be customised and at the same time the safetyrating makes it transparent and uniform. As a resultknowledge is less dependent on individuals – insteadit becomes an integral part of production.

Cahill explains, ‘Our most critical plants now havea rating of level 3 or higher in the InternationalSafety Rating System (ISRS). They will go on toachieve higher levels. At the same time we willgradually apply the DNV system to all our 20 plants.’Golden Vale will also train its own auditors to carryout continuous evaluations, and periodically useDNV’s external auditors.

A SOUND SAFETY INVESTMENTThe improved business results are now paying off.The Board of Golden Vale has accepted a bid fromthe three times bigger Kerry Group. ‘Five years ago,no one would have touched us – a former co-op.Now the bids are coming, because we have improvedconsiderably. I know this methodology is one of thereasons,’ says Sexton Cahill, who underlines howsafety has always been an integral part of all thegroup’s investments. He is keen to bring this valueinto the bigger, merged company in due time.

‘I can guarantee that plants which are runninggood safety systems and scoring well on the ISRS will

have the fewest industrial problems, the best workingenvironment, managers who understand their busi-ness and objectives that are met.’ ◆

GOLDEN VALE PLC

The Irish company Golden Vale is a market-

focused food company with operations

spanning the manufacture and sale of a

wide range of branded and customer-label

food products for international retail, indus-

trial and food service markets. For example,

Golden Vale supplies dried milk powder to

Nestle and is the largest supplier of cheese

slices to McDonald’s throughout Europe.

Golden Vale employs approximately 2,600

people.

MODERN SAFETY

MANAGEMENT SYSTEM

DNV’s safety management system is based

on the International Safety Rating System,

where a company’s safety management is

rated on a scale from 1–9. It is a comprehen-

sive and systematic approach to all safety

and loss control aspects. It deals with root

causes of loss and hazards without any

appreciable increase in documentation.

Golden Vale’s Peter Drillingcourt (left) andSexton Cahill have backgrounds in heavyindustries (aviation and alumina, respectively)where systematic safety management is vitalfor existence.


FOOD SAFETY

Forum.qxd 03.09.01 22:57 Page 19

Raising the Safety Bar

TEXT: [email protected]: COURTESY OF KNPC

Kuwait National Petroleum Company is taking SHE man-agement to new heights, establishing as part of its PolicyStatement a management programme covering all aspectsof its operation. DNV Consulting is actively co-operating inthe programme’s development and implementation.

Forum.qxd 03.09.01 22:58 Page 20

Forum.qxd 03.09.01 22:58 Page 21

KKuwait National Petroleum Company (KNPC) oper-ates a major oil and gas processing complex nearKuwait City. This consists of three refineries, one gasprocessing plant and a local marketing departmentwhich distributes and markets petroleum products tothe general public. The three refineries (Shuaiba,Mina Abdullah and Mina Al-Ahmadi) togetherprocess some 1 million barrels of crude oil each day.

Says Sami Al-Rushaid, executive assistant managingdirector of KNPC, ‘Our company specialises in crudeoil refining and gas liquefaction operations. One ofour main goals is to achieve full integration amongthe three refineries, and operate them as one effi-cient refining complex in order to achieve a highlevel of flexibility in meeting the requirements ofthe world market.’

Al-Rushaid believes that the safety managementprogramme is key to the success of KNPC. Heexplains, ‘Maintaining Safety, Health and theEnvironment is a core value for KNPC. Our overallaim is to run a successful business with no accidents,no injuries, and no harm to the environment. This isa firm commitment of management, and the respon-sibility of all staff and contractors on our sites.’

According to Al-Rushaid, KNPC recently experi-enced a series of incidents resulting in both fatalitiesand significant loss of production. ‘Although wehave always paid special attention to safety and secu-rity at our plants and installations, we experiencedtwo serious incidents in June 2000. The first was aleak of H2S gas that led to two fatalities during theinspection of the Isomax reactor unit at the Shuaibarefinery. Shortly after, we suffered a major blast atthe Mina Al-Ahmadi refinery, bringing its units to acomplete shutdown and inflicting heavy damage.’

DNV ASSESSMENT STUDY‘Subsequent to these incidents’, says Al-Rushaid,‘KNPC management took immediate steps to analysethe weaknesses in its safety management system, with

the aim of effecting positive and long-lastingimprovements.’

As part of its SHE management system (K-SMS)development, KNPC called in Det Norske Veritas toconduct an assessment study of its facilities, systemsand procedures. The key elements of the K-SMSinclude:• Leadership, commitment and accountability• Management system and audit • Training, competence and behaviour• Emergency preparedness• Incident investigation and reporting• Risk assessment and management of change

IN SUMMARY:

• In the complex, fast-moving world of the

oil, gas and process industries it can be a

challenge to meet all the various stake-

holders’ Safety, Health and Environment

(SHE) goals and expectations.

• The ability to handle risk effectively pays

dividends in terms of improved SHE, direct

savings and enhanced public confidence.

• DNV Consulting has been commissioned by

the Kuwait National Petroleum Company

to help optimise SHE management systems

on its three refineries and a gas processing

plant.

• In the ongoing projects, DNV personnel

are joining KNPC teams in an effort to

make the work process an empowering

one. The work includes behavioural analy-

sis, risk assessment, change management,

training, environmental support and man-

agement systems development.

KNPC and DNV staff at a behavioural element session


INTEGRATED MANAGEMENT

Forum.qxd 03.09.01 22:58 Page 22

Says Al-Rushaid, ‘A major emphasis of the pro-gramme must be on people and their safety atti-tudes, as the majority of accidents can be shown tobe caused by human failure. Therefore training is akey element of this programme, and the aim will beto train everyone in the system from the Chairmandown to the youngest recruit. Everyone must appre-ciate how the system works and their role in makingit happen.

‘The reason that this approach delivers long-termsafety improvements is the better understanding thatcomes from the risk reviews which identify causes ofaccidents and whether safeguards are in place.

These may be people, procedure or hardware basedand must be adequate to prevent incidents. Theunderstanding of every employee of their role inthose safeguards is crucial. Over time, the “continualimprovement” element of the management systemwill drive the residual risk lower and lower as weak-nesses in operation and safeguarding are identifiedand addressed.’

Mohamed Ibrahim, head of K-SMS, adds: ‘DNVhas used benchmark industry approaches for eachof the 14 elements and these have been presentedto our “Element Champions” and their teams alongwith the findings from the baseline assessment. DNVhas then facilitated workshop sessions with eachteam to come up with a practical programme tomeet the expectations of senior management.

‘DNV is taking these results and developing a setof suitable performance indicators, in conjunctionwith the Element Champions. DNV has also devel-oped a series of audit-based measurement questions

that will support each element. Taken together,these element questions will become the KNPCaudit measurement tool.’

100 PER CENT COMPLIANCEA Higher Safety Committee has been establishedto provide safety management leadership and keeptrack of progress, and to identify areas that needattention. Through this process, KNPC aims toachieve continuous all-round improvement.

Concludes Sami Al-Rushaid, ‘Over the past 25years, the process industry worldwide has experi-enced many disasters and much has been learnedfrom those accidents. It is an established fact thatsafe operations come from well-structured and wellthought-out safety management systems that addressall aspects of the process facility and start from athorough understanding of the process hazards.Consequently, we strive to implement the best pro-grammes available and push for 100 per cent com-pliance with all our Health, Safety and Environmentstandards and policies. I am confident that with theco-operation of DNV, we will achieve this goal.’ ◆


INTEGRATED MANAGEMENT

‘The oil and petrochemical industries must be built uponhigh standards in safety, health and the environment’ –Sami Al-Rushaid

‘Major emphasis must be on people and their

safety attitudes ...’

Forum.qxd 03.09.01 22:58 Page 23

T


SHIP NEWBUILDING MARKET

The outstanding productivity growth of the SouthKorean shipbuilding industry is a result of variousfactors. There has been a move of traditional heavyindustry from Western countries to Asia during thepast 20 years. Korea has been faced with a more com-petitive open economy and integrated products andcapital markets in the 1990s, which has resulted in amore market-oriented approach.

Since financial turbulence swept through Asiaduring 1997, Korea has managed to recover from thesevere recession. The country’s ability to put a new,market-oriented system into place has proved its suc-cess in the shipbuilding industry. Priorities have beengiven to encourage foreign investments, industrialand land regulations liberalise industrial activities,and new business regulations promote competition.

INVESTING IN NEW TECHNOLOGYThe history of modern Korean shipbuilding is rela-tively short, about a quarter century of full-scaleoperation. More than 20 years ago Europe enjoyedhigh productivity in shipbuilding. From the 1980sthe industry moved to Asia, where Japan held the

lead until recently overtaken by Korea. Korean shipyards have primarily built bulk carriers

and container ships. In recent years they have invest-ed heavily in R&D, and can now deliver complexvessels such as LNG and LPG carriers, offshore rigsand FPSOs (Floating Production, Storage andOffloading Units).

Shipbuilding is a labour-intensive industry, andincreased labour costs are considered a major factorin the shift from European to Asian dominance. Onereason for Korea’s shipbuilding success might be theready supply of a cheap, educated and skilled work-force. However, labour costs are now increasing inKorea, which helps explain the growing Chineseshipbuilding market.

The shipbuilding industry employs approximately46,000 with an average age of 39 – much youngerthan their Japanese counterparts. While Japan expe-riences difficulties in recruiting skilled staff to theshipyards, Korea has no recruitment problems. Thisis in part due to the perception of shipbuilding ashigh-status employment by those working in theindustry.

South Korea heads the league


South Korea is today’s leading ship-building nation, with 43% of all shipson order. Traditionally strong ship-builders in Europe and Japan are drop-ping behind, while the Chinese marketis slowly catching up. Three top Koreanexecutives here explain the reasonsbehind its shipbuilding success.

Forum.qxd 03.09.01 22:59 Page 24


SHIP NEWBUILDING MARKET

According to head of Shipbuilding Division atUlsan Shipyard, Jae Byoung Song, the mainreason for the South Korean lead is their abili-ty to meet the market needs by being flexible.

‘A high degree of engineering capability iscrucial for the Korean yards to succeed,’believes Moon-Kyu Lim, senior vice presidentat Daewoo Shipbuilding & Marine Engineering.

INDEPENDENT SHIPBUILDERSON THE INTERNATIONAL SCENESouth Korea’s three major shipbuilders are HyundaiHeavy Industries, Samsung Heavy Industries andDaewoo Shipbuilding & Marine Engineering. Allemphasise the importance of being independentcompanies competing on the international market.

They are now reaping the benefits of the country’sindustrial regulations to liberalise business activitiesand promote competition. From being part of largeindustry conglomerates, they are now independentfirms quoted on the Stock Market. This new freedomhas made them more flexible to meet market needs,and enabled them to reinvest in new facilities.

The three main yards have together delivered over1,400 ships and numerous steel structures and off-shore rigs. Their order books are full until 2003, witha variety of ship types.

FLEXIBILITY THE KEYAccording to the head of the Shipbuilding Divisionat Ulsan Shipyard, Jae Byoung Song, the main reasonfor the South Korean lead is the yards’ ability to meetmarket needs by being flexible.

‘We have to change according to market needs,’he says. ‘There is a perceived need for approximately100 new LNG vessels worldwide in the next fouryears. There are limits on how many we can build atthe same time, but we can manage by being flexibleand spread the activity to other yards, or allocatedocks for special assignments.’

Hyundai Heavy Industries runs the Ulsan Shipyard;it is the biggest shipbuilder in the world, with a capac-ity of about 60 commercial and naval vessels per year.Nine dry docks can be allocated individually accord-ing to demand.

ENGINEERING CAPABILITY‘A high degree of engineering capability is crucialfor the Korean yards to succeed,’ says Moon-Kyu Lim,senior vice president at Daewoo Shipbuilding &Marine Engineering. ‘We have to provide our work-

force with continuous training and education. If wefail, they will leave.’

Daewoo has its own training package for all newemployees. Additional training is provided by DetNorske Veritas, to maintain workers’ understandingof the most important technology developments andrequirements in the industry.

TREATMENT OF WASTE‘Shipbuilding without consideration for safety, healthand the environment cannot survive,’ says C.H.Park,vice president of Samsung Heavy Industries. ‘Thetreatment of waste has moved to seaborn areas andthe shipping industry has to follow up with environ-mentally friendly transportation. National bodies andthe public at large are watching us closely.’

Samsung Heavy Industries is meeting the new stan-dards by being the first shipyard in the world certifiedaccording to the environmental standard ISO 14001.In addition it has been certified according to the newenvironmental standard OHSAS 18001. ◆

The Korean ministry of commerce expects the value of ships

built or exported to pass USD9Bn this year against USD8.23Bn

last year. During the first half of the year, Korean shipbuilders

exported ships worth USD5.7Bn, over 44 per cent higher than

the same period last year when USD3.9Bn worth of ships was

built. The value of Korean ship exports has maintained a 20

per cent rise annually for many years.

Tanker Bulker Container Dry Cargo Roro Passenger

700

600

500

400

300

200

100

0

Nu

mb

er o

f sh

ips

Ship types on order by country/region

S Korea EU Japan China

‘Shipbuilding without focus on safety,health and the environment cannotsurvive,’ says C.H.Park, vice presidentof Samsung Heavy Industries.

Forum.qxd 03.09.01 22:59 Page 25


SHIP CLASSIFICATION

TThe Royal Australian Navy is a small but professionaland capable force. The fleet is varied – Americanand Australian-built FFG frigates, Australian-builtFFH frigates derived from the German Meko class,modernised Landing Platforms Amphibious (LPA)which used to be in USN service, a French AORReplenishment Ship Tanker, an ex-RFA British AOReplenishment Ship, Australian-built Minehunters,Coastal MHCs of Italian design, old Fremantle classPatrol Boats, Australian-designed and built Collinssubmarines of Swedish design heritage, and newHydrographic Ships. More than 25 new vessels areplanned over the next decade or so.

DNV is helping RAN improve overall safety andintegrity. Capt. Drew McKinnie is director generalof the Navy Certification and Acceptance Agency;he points out that the fleet is facing some real chal-lenges in ‘Parent Navy’ responsibilities and over-heads. ‘Our uniquely mixed fleet is undergoingmajor renewal and this will stretch our resources.We are small in manpower terms – only about 12,500in uniform, and a similar number of defence civil-ians. We do not have the capacity to do everythingin-house like the major powers. Our relationshipwith the defence and maritime industries is strategi-cally vital. Classification societies such as DNV areimportant links in helping us to deliver capability, tooperate safely, to fight and win at sea.’

ADOPTING COMMERCIAL STANDARDSLike many nations, the Royal Australian Navy hasseen a major shift from in-house to commercial out-sourcing. The former Naval Dockyards have beensuperseded by commercial yards, and centraliseddesign and maintenance bureaux have devolvedmuch of this work to industry arranged through theSystems Project Offices.

Says Capt. McKinnie, ‘This is not without risk –the challenge is to do it safely, and again DNV is apartner, helping us to gain required assurances ofsafety and integrity. Also, in our new acquisitions ofweapons platforms, we are moving towards greateruse of commercial standards and class rules, simplerspecification and less reliance on military specifica-tions. The opportunity to contribute to the “navalis-ing” of ship rules and commercial standards is goodfor us, for industry, for government, and for the clas-sification societies.’

DNV in Australia has been successful in winningcontracts for Classification services for Huon ClassMinehunter coastal vessels and two LandingPlatform Amphibious (LPA) vessels. The scope ofwork involves establishing a ship-specific Rule set toprovide a basis for appropriate through-life surveyand maintenance requirements.

DNV helps sharpenRoyal Australian Navy’s cutting edge

TEXT: [email protected]: COMMONWEALTH OF AUSTRALIA

An unusual characteristic of the RANfleet is its diversity: a challenge to safeand reliable operation. With many newvessels also on the stocks, DNV is a vitalpartner in the Navy’s future plans.

Forum.qxd 03.09.01 22:59 Page 26

CULTURE OF ACCOUNTABILITYCapt. McKinnie reminds us that the Navy had a seri-ous ‘wakeup call’ with the Westralia fire that claimedthe lives of four sailors. The importance of effectiveregulation and management of safety was highlight-ed. ‘As a Navy, we were starkly reminded that weneeded to take certification, safety and classificationseriously and build stronger ties with the commercialmaritime community. DNV is helping us to reducethe risk of future tragedies. Crew at sea risking theirlives daily in our grey ships, in an inherently danger-ous environment, are the real customers. We are pro-tecting their lives, and Australia’s naval capability.’

Vice-Admiral David Shackleton took over as Chiefof Navy in July 1999, and one of his first tasks in thetop job was to assemble senior leaders and spell outhis challenge to redefine the Navy as a high-perform-ance, capability-focused organisation. He commis-sioned a report from six middle-ranking offers, whobecame known as Tomorrow’s Navy Team (TNT), toidentify major problems and come up with solutions.

The TNT plan was for a Navy with a flatter organi-sational structure, with Navy Headquarters responsi-ble for overall performance, and MaritimeCommand responsible for operations in a militarytheatre, sitting above seven so-called Force ElementGroups (FEGs) to manage the different aspects ofthe Navy’s weapons arsenal. The intention of thegroups was to align accountability and reduce thediffuse management structure which previouslymade it difficult to pinpoint management problems.

TRAINING IN SAFETY & RISK MANAGEMENTNavy executives place a very high value on DNV’scontribution to training in ship safety and certifica-tion. Training and education are vital in changingattitudes, engendering better safety case manage-ment, better decisions, and a more robust andprofessional approach.

McKinnie comments, ‘It’s making a real differencein our operations and maintenance. The SSMOcourse provided by DNV is great value. We’re look-ing at Australianising it – our Force Element Groupstructure in our Navy, the integration of acquisitionand support in our Defence Materiel Organisation,

plus the regulatory roles and functions embedded inNavy Systems Command, all affect the responsibilityand accountability framework for safety case manage-ment. But the methodologies, skills and knowledgeare all entirely applicable. Our AS4360 risk manage-ment standard is world’s best practice, and inter-leaves very well with the SSMO approach.’

THE CHALLENGES AHEADThe Royal Australian Navy has some significant chal-lenges ahead in improving the regulation of design,maintenance and safety, whilst still ensuring cost-effective, affordable support. ‘We need to improvethe application of sound risk management in ourcontractor support and classification society relation-ships,’ says McKinnie, ‘a more collaborativeapproach, with shared use of safety case systems.We cannot go on accepting or ignoring risk. DNVcould help us make more informed risk assessmentsin many areas, assisting with surveys and risk datamanagement.’

He believes that there is real benefit in earlyengagement of the Navy and Defence MaterielOrganisation with strong and credible classificationsocieties, such as DNV, in developing the design offuture combatant ships.

‘We have tended to let the prime shipbuilder con-tractors do this in the past. I think we should workmore closely with Class in the future, particularlywhere we are the Parent Navy.’ ◆


SHIP CLASSIFICATION

‘We need to improve the application of sound riskmanagement in our contractor support and classifi-cation society relationships’ – Capt. Drew McKinnie.

Forum.qxd 03.09.01 22:59 Page 27

T


PIPELINE OPERATION

Crude oil across AlaskaA Safety Challenge

The trans-Alaska pipeline is part of the world’s longest pipeline system, trans-porting oil from Alaska’s North Slope 800 miles south to the Port of Valdez. Thetrans-Alaska pipeline system, known as TAPS, also traverses one of the world’smost vulnerable environmental areas, and is under constant surveillance by reg-ulators, interest groups and the public. Alyeska Pipeline Service Company oper-ates TAPS for six owner companies: British Petroleum, ExxonMobil, Phillips,

Williams, Unocal and Amerada Hess.Alyeska has operated TAPS since start-up in 1977 and has achieved an overallreliability factor of 99.78%.

TEXT: [email protected]: FRED HIRSCHMANN

The TAPS right-of-way crosses land owned by theFederal government, the State of Alaska and AlaskaNative Corporations. The original right-of-way hasbeen in place since 1974 and will expire in 2004.Now the TAPS owners are in the process of seeking a30-year renewal. According to Steve Jones, TAPSROW Renewal Manager, ‘under the laws governingTAPS, the ROW can be renewed so long as TAPS isin compliance with the existing Federal grant, Statelease and other applicable laws’.

Dan Hisey, Chief Operating Officer for Alyeska,says ‘operating a pipeline through Alaska is likeworking in a fish bowl. The amount of regulatoryoversight focused on TAPS is unique in the U.S.pipeline industry.’ Primary government oversight isexercised through the Joint Pipeline Office (JPO).The JPO is composed of Federal and State agencies,led by the Federal Bureau of Land Management(BLM) and the State of Alaska Department ofNatural Resources (DNR). In all there are morethan 20 regulatory agencies that have TAPS over-sight responsibility.

RENEWAL PLANAs part of the renewal process, Alyeska is evaluatinghow to bring a less bureaucratic and more systematicapproach to its business processes. The company’s

The trans-Alaska pipeline crosses hundreds of miles of Federaland state lands in Alaska. Its owners are in the process ofrenewing permits for another 30 years of operation.

Forum.qxd 03.09.01 22:59 Page 28

management systems have been reviewed and diag-nosed by DNV, and a renewal plan is being imple-mented throughout the organisation.

Explains Hisey, ‘Over the past twenty-four yearsAlyeska has made and continues to make improve-ments to TAPS operations. Now we’re in the processof revising our management systems and businessprocesses to be sure we are prepared for future oper-ations. In order to get an independent evaluation ofour compliance processes and management systems,we hired DNV to carry out a third-party audit.’ Mostsignificantly, the audit included a roll-up of detailedfindings into root cause system findings. According toHisey, this review made it clear that Alyeska neededto improve the way it worked across the company.‘DNV examined all our operations and told us whatwe could do better from both a detail and a systemsperspective.’

During the first 24 years of operation, changes inregulatory requirements, training standards, technol-ogy and operational parameters led to a significantincrease in the number of manuals and reportingprocedures.

According to Jim F. Johnson, Right-of-Way Compli-ance Director, the time had come to integrate thecompany’s processes into one simplified managementsystem. ‘Previously we were tied up in details whichprevented us from seeing the system as a whole,’Johnson says. ‘The new approach has allowed us toimprove management effectiveness by making it moreintuitive – by reducing complexity we will ensure thatAlyeska’s compliance and regulatory responsibilitiesare fully understood and effectively managed.’

CONTINUOUS PROCESS OF COMPLIANCEAlyeska’s definition of compliance is not a moment-in-time happening but rather an ongoing process.‘This is not a traffic-ticket approach’, says Johnson.‘Instead, we are focusing our management systems ina systematic way so we can assure our stakeholdersthat we have processes in place to ensure continuingcompliance.’

Dan Hisey has been assigned accountability forimplementing the changes in the organisation.‘We recognise that the transition will require a fullcommitment to change by the entire organisation,starting at the very top,’ says Hisey. ‘The new pathwill not be easy or short, and transition to a newsystem will involve behavioural and cultural changesalong with new programmes. Our management teamhas given unanimous support to this improvementplan.’

Since TAPS will continue to supply a significantportion of U.S. crude oil for the foreseeable future,renewal of the right-of-way is in the public interest.TAPS owners anticipate that the renewal process willentail a rigorous review of a number of complexissues. Redesigning the company business processesand management system will ensure TAPS continuesto meet the high standards the public and regulatorsexpect. ◆


PIPELINE OPERATION

TRANS ALASKA PIPELINE SYSTEM (TAPS)

• Operator: Alyeska Pipeline Service Company

• Owners: BP, ExxonMobil, Phillips, Williams,

Unocal, Amerada Hess

• TAPS transports approximately 17% of annual

U.S. crude oil production

• Some 20 state and federal regulatory agencies

monitor TAPS on a regular basis, making it the

most heavily regulated pipeline in the U.S.

• In 1974 TAPS’ owners obtained a 30-year,

renewable right-of-way to build and operate

the pipeline system on state and federal lands.

This lease expires in 2004.

‘DNV examined our operations andtold us what we were doing rightand what we could do better toimprove our management systems.’

Dan Hisey

Forum.qxd 03.09.01 23:00 Page 29

ENVIRONMENTAL MANAGEMENT


A‘A structured approach is important for a companylike BP where individuals periodically transfer fromone location to another,’ says Norman Ingram,Manager of Compliance Assurance & ContinualImprovement at BP Exploration Alaska (BPXA).‘A universal system open to everyone is power foran organisation. We save money and time, and addvalue in the long term. A business as large as oursbenefits from a structured EnvironmentalManagement System (EMS) in order to manage thechange associated with legal and other require-ments. The complexity of the U.S. and State ofAlaska regulatory framework makes this a dauntingtask, but we are committed to getting it rightthrough our compliance assurance process.’

In many cases BP’s initial environment objectiveshave been greatly exceeded through the newapproach. A great deal can be achieved when all parties involved focus on clear and specific goals.Reducing the impact of emissions to air is one ofBP’s key objectives. Having already achieved a 5%reduction in greenhouse gas air emissions, BP ishalfway to its goal of 10% by 2009.

Since BPXA is a collection of separately managedbusiness units facing different sets of operating cir-cumstances, it could be a challenging task to main-tain a consistent EMS approach while allowing flexi-bility to meet the unique operating needs of eachasset. According to Ingram, implementation of theISO 14001 standard in Alaska has provided BP with

BP reaps the benefitsof ISO 14001

Oil major BP realises significant benefits from implementing theenvironmental standard ISO 14001. By committing to a structuredapproach on a long-term basis, it is already reaping the benefitsof this environmental journey. Air emissions from greenhousegases have been reduced by 5% worldwide, and on one installa-tion performance improvements have resulted in 50% annualwaste reduction.

TEXT: [email protected]: RANDY LISSAY

Performance improvements inspill reduction through productelimination at the Endicott oilfield on the North Slope haveresulted in overall annual costsavings of $525,000.

Forum.qxd 03.09.01 23:00 Page 30

a common framework to allow the assets to developindividual EMSs that are aligned and standardised tothe greatest extent practical.

BPXA operates under unique and sensitive envi-ronmental conditions on Alaska’s North Slope, bor-dering the Arctic Sea. Its operations require minimis-ing impact on the environment wherever possible.Environmental laws and regulations affect everyaspect of BPXA’s operations in the area. Each oilfield is continually enhancing its EMS to ensure thatcompliance requirements and responsibilities areclearly defined.

IDENTIFIABLE SAVINGSPerformance improvements in spill reduction at theEndicott oil field on the North Slope have resultedin overall annual cost savings of $525,000. ‘These arenot “fuzzy” numbers like deferred costs,’ saysIngram. ‘These are real dollars of annual expendi-ture for the asset. By standardising our EMS we havemanaged to reduce complexity in the existing sys-tem, which in turn has translated into efficiency.Overall we believe that the efficiencies gained froma structured versus ad hoc approach are significant.’

Documentation of the EMS is on-line and availableat all BP’s operational assets worldwide. The compa-ny has made great strides during its initial implemen-tation to use web technology and eliminate paper inthe process. ‘This part of the EMS is very importantto us since the records demonstrate overall confor-mance, but additionally it is our key in demonstrat-ing compliance with the rigorous legal requirementsin Alaska,’ says Ingram.

BPXA has a standardised process to periodicallyidentify significant environmental aspects across alloperations on the North Slope. The process looks atthe environmental severity associated with eachaspect, the frequency of incidents, and the degreeof operational control in place. Many BP regionsaround the world have adopted the process as bestpractice. The environmental aspects they are cur-rently focused on basically break down into impactfrom spills, emissions from rotating equipment and

flares, solid and hazardous waste generation and dis-posal, and impact on wildlife.

THIRD-PARTY ASSURANCEBP was the first international oil major certified toISO 14001 by DNV, starting in 1997. It is now able toprovide third-party assurance to external parties thatthe EMS meets rigorous international standards forenvironmental management. ‘BPXA has demonstrat-ed continual improvements in meeting environmen-tal objectives and targets since the certification,specifically in the area of air-emissions reduction,’says Dolores Mick Tankersley, DNV’s lead auditorassessing BPXA through annual maintenance auditssince initial certification. ‘In addition BP continuesto improve the processes of the EMS throughenhancing the consistency of the system throughoutits assets in the U.S.A.’

BPXA requires a documented EMS for selectedcontractors on the North Slope, who represent thegreatest environmental exposure through the natureof the services they provide.

‘We realise significant benefits from the implemen-tation of ISO 14001, but we are still relatively early inthe journey,’ says Norman Ingram. ‘As the organisa-tion seeks further improvements, the challengebecomes greater to identify and take preventiveactions. In Alaska we are growing and developingnew assets on the North Slope and Kenai Peninsula.By taking full advantage of our EMS in these newoperations, we will continue to drive environmentalimprovement.’ ◆


‘A universal system opento everyone is power foran organisation.’

ENVIRONMENTAL MANAGEMENT

Norman Ingram

‘By seeking ISO 14001 compliance, BP hascommitted itself not only to a smarter wayof doing business, but also to responsiblestewardship of Alaska’s valuable resources.’

Tony Knowles, Governor of the State of Alaska

Forum.qxd 03.09.01 23:00 Page 31

When the boat comes in… BRC certification helps prawn producer swim with the big fish in quality-driven food market

TEXT: [email protected]: CORBIS

Forum.qxd 03.09.01 23:00 Page 32


CERTIFICATION

LLenvik Fiskeindustri, which produces peeled andcooked prawns primarily for the European marketfrom its factory in remote Kårvikhamn in northernNorway, has recognised that third-party certificationof its processes represents not only a vital safeguardbut also a significant competitive advantage.

‘Product safety and traceability are undoubtedlythe key factors driving consumer demand in theretail market,’ explains Øystein Pettersen, marketingdirector of Lenvik’s wholly-owned marketing armStella Polaris.

Lenvik recently became the first Norwegian com-pany to earn DNV certification to the BRC TechnicalStandard 2000, a relatively new quality standardestablished by the British Retail Consortium (BRC)to ensure food products conform to stringent healthdemands. The company was established in 1968 as aproducer of salted and dried fish and fillets, and hasspecialised in prawn production since 1984. The fac-tory produced 2,300 tonnes of prawns last year, with90% of this exported to its main markets of Sweden,Finland and the U.K.

Most major European retail chains now requirethat their suppliers conform to this common stan-dard. These big retailers account for the lion’s shareof food turnover, and take their responsibility for thehealth and safety of the consumer seriously. With theU.K. as one of its most important markets, Lenvikboss Hans Ove Semmingsen believes certification hassecured the company’s future.

MONITORED BY DNVHe explains: ‘We have tried to anticipate the con-sumer’s demands. Product quality, safety and securityof delivery must take a high priority if a producer isto be recognised as a serious and professional playerin the market. We have taken on board the conse-quences of these market signals and built up our sys-tems, routines and technical standards in line withthese demands.’

Implementation of the BRC standard required com-pletion of HACCP (Hazard Analysis Critical ControlPoints) – a thorough examination of key phases inthe production process. Secondly, it necessitateddocumentation of a quality management system and,lastly, control of the production environment, prod-ucts, processes and personnel. Lenvik achieved theBRC’s ‘high-level’ grading – a notch above the basiclevel – after successfully demonstrating it had reme-died faults revealed by the DNV checks.

Lenvik already had a quality system in place,having gained ISO 9002 approval in 1993, but BRCregulation with its focus on consumer healthrequirements still ‘represented a difficult challengeand a lot of work for us’, according to Pettersen.

QUALITY BENCHMARK‘We have always been in agreement with third-partyapproval in principle, and we opted for the BRCstandard because it represented a higher qualitybenchmark for us,’ he says. ‘Our business strategy isto maintain and improve this quality system. We areworking directly towards the end-users – supermar-kets and caterers – and this places upon us a muchhigher degree of responsibility for our products andprocesses.’

DNV certification has now given Lenvik recogni-tion as a BRC-approved supplier, raising its profilein the market and expanding its potential customerbase. According to Pettersen: ‘This approval hasgiven us access to a wider market and enabled us towin business with new customers that have BRC as aprimary requirement and which we otherwise couldnot have approached.’

Many of Lenvik’s biggest customers have indicated,on the basis of BRC certification by DNV, that theywill not undertake their own audit of the company.‘For us, this means greater security, less disruptionand reduced costs,’ says Semmingsen. ◆

Health scares caused by recent outbreaks of BSE and Foot-and-Mouth disease among livestock in Europe – and the accompany-ing media publicity – have served to sharpen focus on qualitycontrol in all links of the food chain. Strict regulation and mon-itoring of food production, from sourcing of the raw materialsthrough processing, production and final distribution to theconsumer, are now considered a prerequisite by an increasinglydiscerning public. Implementation of quality standards canmean the difference between success and failure for foodstuffproducers in today’s highly health-conscious retail market.

Forum.qxd 03.09.01 23:01 Page 33

DNV StrategyPlan definesBusiness AreasAt its meeting on 21–22 June,

DNV’s board of directors approved

the company’s new four-year

Strategy Plan. This mandates DNV

becoming by 2005 the world’s

leading Classification Society and leading

Certification company. It will also be a major

Consultant in technology and business risk.

Three Business Areas are defined – DNV Maritime,headed by Tom Virik; DNV Certification (MiklosKonkoly-Thege); and DNV Consulting (Iain Light).Explaining the new Strategy Plan, CEO HelgeMidttun says ‘Its implementation is based on moreaccountable and market-focused Business Areas;each is responsible for managing the business world-wide. We shall introduce separate Regional struc-tures for each Business Area, with one person ineach country responsible for cross-BA cooperation.’

A new unit at corporate level is DNV Innovation,charged with commercialising new ideas developedthroughout the organisation. In addition, there arefour Independent Business Units – Argus RTM, Avitas,DNV Eiendom and DNV Software. The new Strategy,says Midttun, ‘places stronger focus on innovationand business development.’

Certification for 135ArvinMeritor plantsDNV has secured a worldwide contract to perform

ISO 9000 and QS 9000 certification for all 135 sites

of ArvinMeritor.

With 1999 sales of USD 4.5 billion, the company hasestablished its reputation as a global automotive sup-plier of a broad range of components and systemsfor commercial, speciality and light vehicles and theaftermarket.

The Meritor product line consists of two businesses:Commercial Vehicle Systems, a leading supplier ofcomplete drivetrain systems and components for

medium- and heavy-duty trucks, trailers and off-high-way equipment and speciality vehicles, including mili-tary, bus and coach.

The second is Rescue and Light Vehicle Systems, amajor supplier of roof, door, automotive body, accesscontrol and suspension systems, and wheel productsfor passenger cars, light trucks and sport utility vehicles.

LNG plant risk studyDNV is developing risk-engineering expertise in

the fast-growing LNG (liquefied natural gas) mar-

ket. A new LNG plant to be built in the north of

Norway has been subjected to extensive risk

analyses by DNV.

It is the first time the contractor, Linde Engineeringand Contracting in Germany, has made use of riskcalculations in the layout concept instead of usingonly engineering standards. A consortium compris-ing Statoil, TotalFinaElf and Gaz de France will ownthe LNG plant.

One of the challenges facing the DNV engineerswas the requirement to perform an extensive escala-tion analysis for a fire and fragmentation explosion.Based on the results of this analysis, the plant-layoutdesign was refined to meet Statoil’s safety require-ments.

A taskforce of five engineers has been responsiblefor these studies, which involved Hazops in differentstages of the project, calculating safety distances,developing a safe layout for the facility and conduct-ing a full quantitative risk analysis.

This project is one of several similar projects inwhich DNV is engaged in risk studies for LNG plantsand terminals worldwide.

NEWS


Helge Midttun,Chief Executive Officer of DNV

Risk contours for LNG production facility

Forum.qxd 03.09.01 23:01 Page 34

Camaçari improvessafety managementThe Camaçari petrochemical complex, one of the

biggest and most important in Brazil, has com-

missioned DNV to perform risk assessments at 52

companies operating in the industrial complex.

‘This project will bring a significant improvement insafety management to the Camaçari complex,’ saysLuiz Fernado Garcia Lampeiro, Polibrasil’s superin-tendent in Camaçari.

Embracing all 52 companies within the Camaçaricomplex, the project schedule is 30 months with aninvestment of USD 1.5 million. The project compris-es training of personnel, identification, mapping andassessment of hazards, risk assessments, recommen-dation of mitigation measures and the implementa-tion of risk management and reduction programmesin all companies involved.

EU Project16 organisations from eight European countries

are represented in the EU-funded Research and

Technology Development project RIMAP. The proj-

ect is part of DNV’s strategic research programme

Energy and Resources.

The overall goal of the project is to develop a unifiedapproach to make risk-based decisions in the field ofmaintenance and inspection. This is particularlyimportant for pressure equipment when the newPressure Equipment Directive (PED) comes intoforce in 2002. The present PED does not address thein-service phase, only the design phase.

The main deliverables from the work will includea method describing a unified approach to mainte-nance and inspection planning based on risk-deci-sion criteria and cost optimisation. Also, document-ed validation and testing of the method within theindustry sectors represented in the project will beestablished, as will a technical framework for aEuropean standard for inspection and maintenanceplanning.

Related links: http://research.dnv.com/rimap

DNVPS welcomesbunker move DNV Petroleum Services has welcomed Singapore’s

latest amendments to its bunkering procedures.

The new standard procedure, to be implementedfrom January 2002, requires that bunker samplingfor the delivery of bunkers to ships will take place atthe ‘point of custody transfer’, which is at the vessel’smain bunker receiving manifold.

DNVPS welcomes this important news and sup-ports the position adopted by the MPA (Singapore’sMaritime and Port Authority) as it sets a standard forother bunkering ports to follow.

DNVPS has been involved in the review of thenew procedures, and is presently lobbying for inter-national support for custody transfer sampling.

The amendments have been endorsed by BIMCO,Intertanko, IBIA and a number of major shipoperators.


NEWS

Camaçari petrochemical complex, Brazil.

Forum.qxd 03.09.01 23:02 Page 35

CClass acts for the shipyard whenthe ship is being built. The ship isbuilt to Class, which means thatClass Rules are met. In manycases nowadays only just met, asshipyards squeeze the specifica-tion in order to compete in theircompetitive market. If the owner wants an amend-ment to the specification, theshipyard will charge sufficient toensure its profit for the entirebuilding deal remains, orbecomes, positive.

The ship is classed on delivery as‘fit for purpose’. But is it really fit?Is the engine actually powerfulenough to push the ship througha Force 5 headwind? And are theholds actually suitable to load,carry and discharge the cargoesthat such a ship would normallycarry for the 15 to 20-year life ofthe ship? Or is the capesize bulk-er, for example, an ocean grey-hound, to be handled with care,as one Class representative recent-ly put it?

Class then acts for the Ownerafter the ship is delivered.Perhaps a difficult role for anaudit body, to act for the supplierbefore delivery and then for thecustomer after delivery. Class also

acts in many cases for the Flag State, auditing forstatutory certification, but is paid by the Owner.Again, a difficult role: Class as the supplier of otherservices auditing a customer for statutory require-ments.

Why has this difficult situation come about? Basicallybecause there was no one else there. And why isClass now finding itself the victim? Perhaps becausethe role expected of Class has expanded but Classhas not changed to fit that role. There has developeda gap between perception and reality as Class takeson more responsibilities, giving the impression ofbeing able to guarantee something that is demandedof it by its customers and the general public.Something that it cannot, or is not yet prepared to,deliver.

It is interesting to see the Flag State of a ship recent-ly detained in Cape Town apologising to the PortState, but it is disappointing to hear Class saying verylittle, sticking to the line that maintenance is theowner’s responsibility. It is also interesting to see inthe press pictures of the Paris MOU ‘rustbucket ofthe month’, with Class denying that the certificateswere valid when the ship was detained but admittingthat they were acting in a consultative role for theowner.

And it is also interesting to see the differences inPSC detention statistics for the worst and best FlagStates for which the same Class Society has per-formed the statutory and classification surveys.

This is a problem that the industry must solve. Thegeneral public and the industry expect Class to playa certain role in international shipping, and if Classis not prepared to undergo the massive changes nec-essary to be able to offer the performance requiredfor that role then the industry must find an alterna-tive to fill the gap. ◆


LAST WORD

The following article has been taken from Association News, the newsletterof the Hong Kong Shipowners’ Association. The article, by an outside con-tributor, does not necessarily reflect the views or policy of the Association,nor of Det Norske Veritas.

The perception and the realityCLASS:

It seems fashionable nowadays to criticise Class. Asseveral newspapers have put it, to kick them whenthey are down. But what is the real issue here, isClass a convenient but innocent victim or is therelacking a redundancy to that particular link in theIntertanko ‘Chain of Responsibility’?

Forum.qxd 03.09.01 23:02 Page 36


DNV WORLDWIDE

CORPORATE HEADQUARTERSHøvik (Oslo)

Veritasveien 1N-1322 HøvikNorwayTel: +47 67 57 99 00

ABERDEENCromarty House67-72 Regent QuayAberdeen AB115ARUnited KingdomTel: +44 (0) 1224 335000

COPENHAGENTuborg Parkvej 8,3rd Floor2900 HellerupDenmarkTel: +45 39 45 48 00

DUBAIPO Box 11539, JumeirahDubaiUnited Arab EmiratesTel: +971 4 3526626

ESSENBusinesspark Essen - NordSchnieringshof 1445329 EssenGermanyTel: +49 201 7296 0

GOTHENBURGNeongatan 4B43153 MölndalGothenburgSwedenTel: +46 31 771 2600

HELSINKINahkahousuntie 3 (Skinnbyxvägen 3)00210 HelsinkiFinlandTel: +358 9 681 691

HOUSTON16340 Park Ten PlaceSuite 100Houston, TX 77084United StatesTel: +1 281 721 6600

KOBESannomiya Chuo Bldg.,9th Floor4-2-20 Goko-doriChuo-kuKobe 6510087JapanTel: +81 78 291 1302

KUALA LUMPUR24th Floor, Menara WeldJalan Raja Chulan50200 Kuala LumpurTel: +603 2722 6900

LONDONPalace House, 3 Cathedral StreetLondon SE1 9DEUnited KingdomTel: +44 (0) 20 7357 6080

MADRIDCampus Empresarial Jose Mª de Churruca, Edificio III, c/Almansa105- 1ª Pta.- Ofic. 228040 MadridSpainTel: +34 91 4561600

MILANCentro Direzionale ColleoniPalazzo Sirio 2, Viale Colleoni 920041 Agrate Brianza (MI)Tel: +39 039 6899 905

MUMBAIEmgeen Chambers, 10, C.S.T. Road,Vidyanagari, KalinaMumbai 400098IndiaTel: +91 22 6160909 / 6124606

NEW JERSEY70 Grand AvenueSuite 106River Edge, NJ 07661USATel: +1 201 343 0800

OSLOVeritasveien 1N-1322 HøvikNorwayTel: +47 67 57 99 00

PIRAEUS26-28 Akti KondyliPiraeus 18545GreeceTel: +30 1 41 00 200

RIO DE JANEIRORua Sete de Setembro, 55/17 Floor20050-004-Rio de Janeiro, RJ, BrazilTel: +55 21 517 7232

ROTTERDAMHaastrechtstraat 73079DC RotterdamNetherlandsTel: +31 (0) 10 2922600

SEOULRoom 2110, Kyobo Bldg.,1, 1-KA,Jongro, Jongro-KuSeoul 110121Republic of KoreaTel: +82 2 734 7327

SHANGHAIHouse No. 9, 1591 Hong Qiao RoadShanghai 200336ChinaTel: +86 21 6278 8076

SINGAPOREDNV Technology Centre10 Science Park DriveSingapore 118224SingaporeTel: +65 779 1266

STOCKHOLMWarfvinges väg 19BBox 3023410425 StockholmSwedenTel: +46 8 587 940 00

SYDNEYLevel 19, Northpoint100 Miller StreetNorth Sydney, NSW 2060AustraliaTel: +61 2 9922 1966

DNV PETROLEUM SERVICES PTE LTD27 Changi South Street 1Singapore 486071Tel: +65 779 2475

DNV INTERNET HOME PAGEwww.dnv.com

Forum.qxd 03.09.01 23:03 Page 37

CORPORATE HEADQUARTERSHøvik (Oslo)

Veritasveien 1N-1322 HøvikNorwayTel: +47 67 57 99 00Fax: +47 67 57 99 11

CORPORATE TECHNOLOGYAND INNOVATIONHøvik (Oslo)


COPENHAGENRegion Denmark and Poland

Tuborg Parkvej 8, 3rd Floor2900 HellerupDenmarkTel: +45 39 45 48 00Fax: +45 39 45 48 01

DUBAIRegion Middle East

PO Box 11539, JumeirahDubaiUnited Arab Emirates Tel: +971 4 3526626Fax: +971 4 3520524

ESSENRegion Central Europe

Businesspark Essen - NordSchnieringshof 1445329 EssenGermanyTel: +49 201 7296 0Fax: +49 201 7296 102/103

HELSINKIRegion East Baltic

Nahkahousuntie 3 (Skinnbyxvägen 3)00210 HelsinkiFinlandTel: +358 9 681 691Fax: +358 9 692 6827

HOUSTONRegion North America

16340 Park Ten PlaceSuite 100Houston, TX 77084United StatesTel: +1 281 721 6600Fax: +1 281 721 6901

KOBERegion Japan

Sannomiya Chuo Bldg., 9th Floor4-2-20 Goko-doriChuo-kuKobe 6510087JapanTel: +81 78 291 1302Fax: +81 78 291 1330

LONDONRegion Great Britain & Ireland

Palace House, 3 Cathedral StreetLondon SE1 9DEUnited KingdomTel: +44 (0) 20 7357 6080Fax: +44 (0) 20 7357 6048

MADRIDRegion Iberia

Campus Empresarial Jose Mª deChurruca, Edificio III, c/Almansa105- 1ª Pta.- Ofic. 228040 Madrid SpainTel: +34 91 4561600Fax: +34 91 4561599

MILANRegion Italy and Adriatic Countries

Centro Direzionale ColleoniPalazzo Sirio 2, Viale Colleoni 920041 Agrate Brianza (MI)Tel: +39 039 6899 905Fax: +39 039 6899 930

MUMBAIRegion India & Sri Lanka

Emgeen Chambers, 10, C.S.T. Road,Vidyanagari, KalinaMumbai 400098IndiaTel: +91 22 6160909 / 6124606Fax: +91 22 6191380

OSLORegion Norway


PIRAEUSRegion East Mediterranean & Black Sea

26-28 Akti KondyliPiraeus 18545GreeceTel: +30 1 41 00 200Fax: +30 1 42 23 059

RIO DE JANEIRORegion South America

Rua Sete de Setembro, 55/17 Floor20050-004-Rio de Janeiro, RJBrazilTel: +55 21 517 7232

ROTTERDAMRegion Western Europe

Haastrechtstraat 73079DC RotterdamNetherlandsTel: +31 (0) 10 2922600Fax: +31 (0) 10 4797141

SEOULRegion Korea

Room 2110, Kyobo Bldg., 1, 1-KA,Jongro, Jongro-KuSeoul 110121Republic of KoreaTel: +82 2 734 7327Fax: +82 2 739 9069

SHANGHAIRegion Greater China

House No. 9, 1591 Hong Qiao RoadShanghai 200336ChinaTel: +86 21 6278 8076Fax: +86 21 6278 8090

SINGAPORERegion South East Asia

DNV Technology Centre10 Science Park DriveSingapore 118224SingaporeTel: +65 779 1266Fax: +65 779 7949

STOCKHOLMRegion Sweden

Warfvinges väg 19BBox 3023410425 StockholmSwedenTel: +46 8 587 940 00Fax: +46 8 651 70 43

SYDNEYRegion Australia & New Zealand

Level 19, Northpoint100 Miller StreetNorth Sydney, NSW 2060AustraliaTel: +61 2 9922 1966Fax: +61 2 9929 8792

DNV PETROLEUM SERVICES PTE LTD27 Changi South Street 1Singapore 486071Tel: +65 779 2475Fax: +65 779 5636

DNV INTERNET HOME PAGEwww.dnv.com

Forum.qxd 03.09.01 23:03 Page 38

PSNEW MOVES ON BULK CARRIERSDespite numerous initiatives by Classification

Societies and the International Maritime Organ-

isation, bulk-carrier losses continue to occur with

worrying frequency – 14 in the past year alone.

The problem is far from new: DNV has analysed such

incidents for many years. Now, however, influential

shipping executives are themselves putting forward

solutions (see our pages 4–9), and DNV believes that

all classification societies, through IACS, must intro-

duce minimum standards for bulk carriers that will

fit them for their intended cargoes.

Meanwhile, as here, DNV surveyors carry out their

close inspection of bulker newbuildings around the

world.

www.dnv.com

Forum.qxd 03.09.01 22:54 Page 2

Documents

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