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Marine Propulsion & Auxiliary Machinery

Marine Propulsion & Auxiliary Machinery

Norwegian maker seeks a gamechanger

Tue 05 Dec 2017

Norwegian maker seeks a gamechanger
Tore Anderson, chief executive, Optimarin

A new offer of a five-year guarantee could be set to shake up the market for ballast water management systems

As the various deadlines for compliance with the Ballast Water Management Convention get nearer, the market for ballast water management systems (BWMSs) is becoming more and more competitive. This was dramatically demonstrated in September 2017, when Norwegian ballast water management system manufacturer OceanSaver filed for bankruptcy. Many believe it will not be the last to do so.

In such an environment, what the industry needs is 'a gamechanger,' according to BWMS manufacturer Optimarin chief executive officer Tore Andersen. He believes his company has now delivered it, in the form of the Norwegian company becoming the first manufacturer to offer a five-year parts and servicing guarantee.

“We thought it was time to demonstrate our long-term faith in our system and absolute commitment to this segment,” Mr Andersen explained. “No other manufacturer offers a guarantee of this nature, but we can. So if a shipowner signs a framework agreement with Optimarin for installation on multiple vessels, we will provide them with a five-year contract that covers all parts and servicing, worldwide. This is our promise of reliable, safe and effective operations, and, with our total regulatory compliance, complete peace of mind.”

The impetus for this move came from an ABS report that suggested that only 57% of systems currently installed on the vessels of operators surveyed were being operated and that the remaining systems were either deemed inoperable or considered problematic.

“We found this an extremely sad rumour for our industry to have,” said Mr Andersen. “More to the point, it’s ammunition for everyone in the industry to delay uptake, and as a maker we obviously don’t like that. So with this system that we know works, we’re seeking to take that burden of worry from the owner on to ourselves.”

Mr Andersen hopes this move will force competitors into a situation where they have to do the same, because "that’s part of the game.

I’m quite sure that, if you have enough money, you’ll dare to do the same. So I would expect to see the big makers follow suit. But those makers with limited experience won’t dare to do this,” he told Marine Propulsion.

Mr Andersen is emphatic about the need to change shiopowners’ attitudes towards ballast water management systems, which he appreciates are a grudge purchase about which there are still numerous suspicions. He said: “What I want to ensure is that when a shipowner buys one of these systems from a maker, they’re sure it will work. Because we need to change the game. Up until now, shipowners have hardly used the systems. They don’t want to, because there’s been no impetus to do it. But now if you have a system on board, you have to use it. We think our guarantee is a gamechanger, and are quite sure that it will give the owner a different view of what they are up against.”

Mr Andersen believes owners have been unwilling to engage with ballast water treatment, and he feels this needs to change. “Owners now have to take ballast water seriously,” he said. “They have to or they’re laid up somewhere. We know it’s just a cost, but my message is to make sure that it doesn’t cost you any more than the cost of the system. I fully understand that the owners would have liked to avoid this. It’s been a bad market for the last eight years – of course they’d rather not put it on board if they don’t have to. But the USCG has forced owners to put it on board. IMO has delayed it until 2019, but there’s no way back from here. You can like it or not, but that’s a different discussion.”

In fact, Mr Andersen believes that a general indifference to the technology is causing problems in terms of operation, as well as storing up even more because shipowners are not paying sufficient attention to the systems they install or have installed.

“You buy a ship with a complete system that may have cost you US$1M and you just leave it?” he said. “An investment like that and you just put it to one side? Is that smart? If I’d made that investement, I would make sure that the system is up and running and does everything it’s supposed to do. If you leave valves alone and don’t use the system for three years, how well do you think those valves are going to work? They aren’t. You can’t expect them to. Many shipbuilders have not paid attention to what sort of BWTS they have on board or its condition and, when it doesn’t work, they blame the manufacturers - but they need to look at themselves as well,” Mr Andersen argued.

He worries that shipowners are unprepared for the changes in operation that having to operate BWMSs will bring about. Regardless of who you buy the system from, "it’s a totally different operation before and after you have the system on board. It’s totally different – you can forget ad hoc pumping of ballast water – that’s not possible anymore. You have to plan it,” explained Mr Andersen.

Just how big a change this will make is something he illustrates by saying: “On a medium sized ship, you are pumping water through a 350-400 mm pipe from the sea straight into the ballast tank. Now, you have to push the water through 40 or even 20 microns. This is going to make a big difference in terms of deciding where and in what sort of water you take on ballast. We have to make sure that the people on the bridge and in the pump room are 100% familiar with the ballast water plan, and that they understand the systems and how to use them.”

The IMO delay meant many vessels did not have to fit systems until 2019, which hit Optimarin – in common with most manufacturers – very hard. “It changed a lot,” said Mr Andersen. “We heard rumours in February that that could happen, but it effectively meant that roughly 70% of our market disappeared for two years. What happened then is a price war. Even if you’re one of the few with a type approval, you’re still chasing after a limited number of customers. So for us I would say this was a huge setback. We were starting to hire more people, and we simply had to hit the red button and stop everything.”

Mr Andersen is certain the ballast water market will see major consolidation. “Let’s say there are 60 companies operating now. By 2022, I would be surprised if there were 30. I would say that, after the ‘boom’ when all ships have their installations in 2023-2024, there will not be more than 10 makers. It’s impossible that there would be more than that," he asserted.

Mr Andersen took pains to point out that Optimarin will not be “the next OceanSaver.” “We are very healthy. This is the first year we are making money. So the future looks bright, to be honest. We have no debt, we have a very nice balance sheet and we are very well prepared,” he told Marine Propulsion.

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