Maersk to Scrap Four More Vessels at Alang

The Maersk Wyoming goes onto the beach at Shree Ram

By MarEx 2016-12-19 16:38:03

Maersk Group has accepted bids for scrapping four more ships at Shree Ram in Alang, India, plus an additional four at an LR-certified facility in China. 

Maersk did not indicate the sale prices for the Panamax vessels, but as of November 30, typical demolition values at Alang were 25 percent higher than those paid by Chinese yards. Maersk has cited the potential for improving its bottom line in its decision to sell to beaching yards like Shree Ram; in addition, it asserts that the partnership will result in social and environmental benefits. “All past experience of changing any industry points to the fact that real engagement on the ground leads to effective change,” said Capt. Prashant S. Widge, head of ship recycling at Maersk Group Sustainability.

In October, investigative journalists with public interest outlet Danwatch released an expose of conditions at Shree Ram, the first Alang yard Maersk Group selected as a shipbreaking partner. The investigators alleged that working conditions at the yard were unsafe, with deficiencies including: 

- unsafe rigging of cutting gas supply lines along the beach, a risk factor for explosions;
- a lack of appropriate personal protective equipment, including the absence of safety glasses, earplugs or respirators;
- unsanitary living conditions for workers in the nearby community; 
- limited medical facilities to treat the wounded;
- and a lack of formal contract papers with shipbreaking workers.

In response, Maersk acknowledged that the improvement of the yard's practices was a work in progress, and emphasized its ongoing compliance efforts. “We have even seen improvements during the short time we’ve been here, but things still aren’t perfect. Many of the necessary hardware and capital investments have been made, but what really takes time to change is the safety mindset. I think we are a few years away from changing this, but I am confident we can make it,” said Captain Widge.

At the Chinese facility, Jiangyn Xiagang Changjiang Ship Recycling, supervision will be handled by a third party called Sea2Cradle, which boasts 15 years of experience with zero accidents. Maersk did not indicate a role for this firm at Alang; it says that recycling supervision at Shree Ram will be carried out by Maersk QHSE superintendents and external consultants.

“With this tender, we have for the first time seen that the ship recyclers compete not only on price but also on standards. This indicates a move towards higher standards, and we will continue to encourage this development,” says Annette Stube.

Maersk's position is controversial, and it contradicts its own history of opposition to beaching. The advocacy organization NGO Shipbreaking Platform, along with other watchdog organizations and a number of European politicians, have called on the EU to ban European shipowners from using beaching yards like those at Alang.