MIT Tech Day 1993: Oil Spill Issues – Lissa Martinez, Adm. Bill Kime, Rick Quagen, Pandy Embiricos

[MUSIC PLAYING] MARCUS: I’d like to welcome you
to our afternoon panel entitled Oil Spill Issues. I’m Hank Marcus from the
Ocean Engineering Department. And we’re celebrating
our 100th anniversary of having ocean
engineering at MIT, and so we’re delighted
to have you here, and we’re delighted to have
maritime panels this afternoon. Since the grounding of the
Exxon Valdez in March, 1989, the maritime industry has
been a very exciting industry. Lots of things going on here. Now I’m sure you’ve all heard of
the Oil Pollution Act of 1990. That’s been one of
the major events over the past four years. Let me just bring up two
more points that you may not be as familiar with. If you start comparing some
of the oil pollution data from the early 70s
to the early 90s, you see some interesting things. I chaired a marine board
panel, and we dug out the data. And you see that if you
start with the year ’73, ’75 at one end and 1990
at the other end, you see that over
this time span, the amount of oil that has
gone into the ocean as a result of tanker accidents
has decreased by 45%, and the amount of oil
that’s gone into the ocean from tankers as part of
their operational discharges, such as pumping out ballast
water, has decreased by 85%. Now we still feel that
there’s more to be done and what we’re doing today
is still not acceptable, but we’ve had quite an
improvement over the past two decades. The second point
I want to make is that we face a rather unique
situation with the US Congress relative to the design of
tankers in this country. And that has to do
with the way they passed the Oil
Pollution Act of 1990. Basically, we could
we could say we have Congress designing our tankers. And given the naval architecture
experience and expertise of Congress, that scares me. Now it’s certainly
an overstatement to put it that way,
but when Congress passed the Oil Pollution Act
of 1990, they didn’t say. Well, gee, why don’t we
identify all the causes of environmental damage
from oil pollution, and then we’ll analyze each
one and see what the best cost ratio is so we know
where to put our money to get the maximum ratio
between benefits and costs? That would have
been one approach. They didn’t do that. And they didn’t say,
well, why don’t we come up with– how do we develop
some performance standards here, like we do with cars? What we say is, under these
kinds of circumstances, you drive the car into
the wall or whatever, we want the car to
perform in a certain way. We could do that with
ships, and then that way you leave it up to the designers
and the naval architects and engineers to
come up with the best way of meeting those needs. They didn’t do that either. Basically, they
sort of said, read my ships, no new tankers
without double hulls. And that’s sort of
an odd approach. They do ask for advice
from the Coast Guard, and they did that in the act. But if you look
at Congress’s role in the design, the structural
design of any other vehicle of any other transportation
mode in the United States, Congress has never taken
such a strong stand. Whether we’re talking about
cars, or trucks, or buses, or planes, or trains, this
is a rather unique role. Now you might ask, why is that? What is the Congress–
or how does the Congress or the general public perceive
the whole maritime industry, or the universities that train
people in these industries, or the types of research
programs we have? Now indeed, you might
ask that, but you can’t ask that till after
you hear from four experts we have here. And this afternoon,
first we’re going to hear from our regulator,
Admiral Kime from the Coast Guard, who has the
responsibility of implementing many of the
provisions of the OPA, as well as a few other
things the Coast Guard does in their spare
time, myriad number. Next we’re going to hear
from Epaminondas Embiricos, representing independent
tanker owners who have to deal with all the
regulations in the world. Then we’re going to hear from
Richard Quagen representing the oil companies who must
deal with the regulations, and the independent
tanker owners, and their own fleets of
company-owned vessels. Finally, we’re going to
hear from Lissa Martinez. It says representing
environmentalists, what it says in your booklet. Now I happen to
think that all of us up here are environmentalists,
but indeed, Lissa has spent a lot of time working
on environmental research and integrating the
disciplines of engineering with environmental science. And she’s going to put some of
this discussion in a broader perspective of oil
pollution in general. The format we’re going
to follow is as follows. Each speaker will have about 15
minutes to come up and present his or her views,
and then at the end, after we’ve had
our chance up here, we’ll give you your
chance out there, and we’ll have a fun time
of questions and answers from the audience, from each
other on the panel here. And so I think you will have
a great afternoon with that. And the other thing I will
tell you is because you have– these four experts have some
very impressive backgrounds, and those are all well-written
up in the booklets you have, so I’m not going to take
time to describe that. I’ll spend our time on
discussions and questions and answers. So with that, I’d like to turn
over the podium to Admiral Bill Kime, Commandant
of the Coast Guard and president of Society of
Naval Architects and Marine Engineers. KIME: Thanks, Hank. And I greatly appreciate
the opportunity to come back up to MIT, where
I spent three very happy years. And the further I
get from graduation, the happier the
years seem to be. I last had the chance to come
up and give one of the Robert Bruce Wallace lectures
in 1991, and I’m surprised you invited me back. Maybe all the people who
were there have moved on. Let me ask you a question,
why are we here discussing oil spill issues? Why is this something
that’s on people’s mind? I think one reason is the
Exxon Valdez, obviously, that woke up this country to
the concerns of oil spill. Certainly woke up the
Congress to pass OPA 90 after a gestation period
of about 15 years. But let me give you some
of the other reasons why we’re concerned. We’ve got 5% of the
population in this country, and we use over
20% of the energy. As a country, we’re
against offshore drilling. We’re against
opening up the ANWR. We don’t like nuclear power. We hate to carpool. We won’t use or say we don’t
have mass transportation. That means we’re
going to continue to import at an ever-increasing
rate greater amounts of oil by ship. And about 95% of
this is going to come on foreign-flagged tankers. And as a result of that, spills
are going to continue to occur. So I think the issue
is, what can we do to minimize
their probability, and to maximize the
effectiveness of our response when they do happen? I think this is
something that is going to require
the major dedication and cooperation of many people,
ship designers, shipbuilders, ship owners, ship charterers,
ship brokers, ship’s crews, classification societies, the
insurance industry, the P&I clubs, flag states, port
states, and certainly, the oil companies. How are we going to do this? I think we’re going to do
it by effectively addressing five areas of concern. One , and one of
the most important, the prevention of a
spill in the first place, our preparedness to respond
to spills once they do occur, how we actually do respond,
the question of liability for the spiller,
and then finally, compensation for those people
who are impacted by the spills and the restoration
of the environment. Now, ideally, we would
do this internationally through the IMO, the
International Maritime Organization, which
is a specialized agency of the United
Nations, under whose auspices safety and environmental
treaties are negotiated. The IMO is located
in London, and I believe they have a lot 140
member countries right now. However, some
problems in the past have led to unilateral
action by the United States. And as Hank Marcus said, the
Oil Pollution Act of 1990. Now Congress didn’t just jump on
the Oil Pollution Act of 1990. They’d been working on
this for about 15 years. And there’d been a
lot of discussions about doing many
of the things that are contained in
the Oil Pollution Act for many, many years. While there are 535
members in the Congress, and as Hank pointed out,
no naval architects, they do have a memory. And they do recognize that
the industry itself did not respond in what they felt was
a reasonable way to incidences that have occurred. Certainly, we’ve cut down
the operational pollution from tankers. We’ve cut down the accidental
pollution from tankers. But by the same token, I think
we’re faced with a society right now that is more
demanding and less forgiving for incidences. OPA 90 was unilateral
action by the United States. And that same type
of unilateral action is threatened right
now, perhaps even imminently, by the
European community, and by the UK in
particular, due to the fact that IMO standards in the past
take too long to be developed, take too long to come into
force, or they are ambiguous, or they represent the
least common denominator, and they’re not
enforced in many cases. So my belief is
that IMO is still the vehicle to attack all
aspects of oil spills. But if we don’t
through IMO eliminate substandard ships, substandard
crews, substandard owners, substandard insurance companies,
substandard regulations, substandard enforcement,
which I think is the biggest problem,
substandard flag states, and substandard
port states, unilateral action led
by the United States and the EC is going
to become the rule. Let’s look in some detail at
each important area concerning oil spills. First, prevention, second,
preparedness, third, response, then liability and
compensation, and follow it up with a question of enforcement. There are many
international conventions that deal with these
subject, the Safety of Life at Sea convention,
or SOLAS, the treaty to prevent pollution from ships
or MARPOL, OPRC 90, the Oil Pollution
Preparedness, Response, and Cooperation Treaty. Protocols, so the civil
liability convention and the fund convention,
the Convention on Standards of Training, Certification,
and Watch-Keeping, all of these done by the Maritime Safety
Committee of the International Maritime Organization and
the Environmental Protection Committee. There’s also a new
subcommittee there called FSI, which is the
Flag State Implementation subcommittee that has
recently been put into place. And I’ve also refer to a new
code, the International Safety Management Code that we hope
to bring into force at the IMO assembly in October. Now going to prevention first,
that’s covered in many aspects by the STCW convention,
by SOLAS, MARPOL, and the International
Safety Management Code. Let’s look at some of
the specific areas that need a bit more attention. We spent a lot of time in
STCW talking about training of people aboard ship. If you were a chief engineer,
if you were the cargo officer, if you were their
master, this is what training you had to have. But it is totally silent. And the maritime
community has yet to face up to the
issue of things such as minimum level of
manning, crew fatigue, the amount of time you can spend
on the ship, team training. In 1995, the Secretary General
of IMO, Mr. Bill O’Neil, has set this as a date for a
significant revision of STCW. Hopefully, we will finally come
to grips with these issues. If you asked me the
reason we haven’t, it’s easy to talk about training. It doesn’t cost a whole
lot to talk about it. When you start setting
manning standards and hours that people can work
and fatigue standards, that starts to cost a
great deal of money. For prevention, we need
vessel traffic systems. We’ve just looked at 23
ports in the United States, and are going to be phasing
in vessel traffic systems very similar to the
type of air control that you see in the
nation’s airways. We’ll be using things such as
dependent surveillance, where a ship will pick up a
global positioning system signal from a satellite, it’ll
be corrected by differential mechanism to give it an
accuracy of about 8 meters, and transmit that back to a
Coast Guard control facility. We’re going to be requiring
tug escorts in certain areas, like already in Prince William
Sound, Puget Sound, and San Francisco Bay. We’re going to see coming
this summer a requirement that went in, the US navigable
waters, which means anything from three miles in, two
deck officers on the bridge, an engineer in the
engine room no matter how automated the ship is,
and automatic pilot ships will not be able to operate in
these navigable waters except under certain circumstances. There can be tanker exclusion
zones where tankers will not be allowed at all. We’re going to talk
about ship construction. And Hank said that double
bottoms, double hulls may not be the answer to
a maiden’s prayer. But certainly, they are
going to go a long way towards preventing a lot
of the pollution we have. Some people say things like
the mid-deck design or vacuum designs are things that
we ought to move toward, but we haven’t
seen any real ships being built that way, even
any large scale models. And we talk about Congress using
performance standards for cars, and we see on TV pictures
of Volvos and BMWs being driven into brick walls. We can’t do that with
a heavy industry. You’ve got to be a bit
more prescriptive sometime. Or the industry, if
they want to get out from under specific
regulations, the Congress is going to have to
come forward with more in the area of research
and development. One thing that’s very
encouraging to me is the damage resistant hull
study that’s being done by MIT. There’s 11 contributors to
this project, one of which is the Coast Guard. It’s paying about
15% of the funding. This is the kind
of thing I think we need more of if we want to
keep the Congress from acting. Shift to preparedness, and
there it’s the OPRC convention. Its parallel in
the United States, again, is OPA 90,
because OPA 90 kind of covers all of the
areas of concern of these international treaties. Requires a national
response plan for pollution. That’s being revised right
now to be published shortly. Area response plans. The Coast Guard has established
a national strike force coordination center and
three strike teams that will be able to
respond to a spill, and also to provide
for training. Not only for Coast Guard
people, but for others. And there’s a simulation going
on right now as we speak here in the Boston area. There’s going to
be a requirement for prepositioned equipment. The Coast Guard has established
prepositioned equipment in 19 sites around the
country that we selected on the basis of need,
past experience, type of cargo moved
through the ports. And finally, shipping
terminals are going to have to have response
plans approved by the Coast Guard. They had to be submitted
by the 18th of February, and you have to operate
under these plans by the 18th of August or
you can’t operate a ship or a terminal in US waters. And this is going to
require that there be designated individuals to
be in charge 24 hours a day should a spill occur,
and that you identify and have under contract
pollution response equipment. Leading us into response, again,
internationally is the OPRC. And there, we’re
going to utilize the items I just mentioned,
the equipment and the planning. We also have other
things that we need to do a better
job in though in utilization and in response. One is dispersants. As a country, we have never
been able to come to grips with the use of dispersants. The Torrey Canyon was a
major oil spill incident off the coast of England, and
the British response to it was to soap up the
entire Atlantic Ocean using an exorbitant
amount of dispersants, doing probably more damage
with the dispersants than was done by the oil. That caused in the United
States a great reluctance to use dispersants. We’ve never brought this
back to an even keel. There are many cases where
dispersants can be used, but we can’t get beyond the
political stigma of them. The scientific community
can’t come to grips with it. Local elected officials who have
a veto in this cannot face up to the political realities. There are cases where
dispersants could be used and aren’t. We need to come to
grips with this. Bioremediation, another area
where you provide nitrogen to existing microorganisms
in the oil that will accelerate the
degradation of the oil by the microorganisms. We certainly used
this in Alaska. I spent three weeks in Alaska
as the federal on-scene coordinator responding to
the Exxon Valdez spill. There we saw bioremediation
being used very well, very safely. But again, the same
political concerns about it so we can’t get the
maximum use out of it. In situ burning. We can’t get a
permit from the EPA, even though funding
is available, to do testing to see if
burning the oil on-site once it’s in the water,
and then measuring the effects in the
water column, in the air to see if this isn’t more
beneficial than letting the oil come ashore. We can’t get a
permit to do that. Mechanical cleanup, skimmers,
booms, things of that nature. We’re in the T model Ford
stage in that particular area. OPA 90 wanted research
in these areas, authorized a significant
amount of money. US Coast Guard is the
only federal agency that has sought and received
money from the Congress to do research in this area. This is an area that we
need a tremendous amount of cooperative effort, both
nationally and internationally. Now finally, we can talk about
liability and compensation. And there are two
international conventions that provide for this, the
CLC and Fund Convention. It’s a two-tiered approach. The CLC Convention, the
Civil Liability Convention provides that the ship
owner has the first tier. He’s the one that can keep
the oil from spelling. He has liability up
to a certain level. And then for spills that
are in excess of that, country’s, based on the amount
of oil they produce or import, contribute a certain amount
to an international fund that would take care of
the very, very large case. The United States did
not sign this convention because these
limits of liability from a practical basis
were much too low. In 1984, the protocols were
developed internationally that raised these
levels significantly. But the United States did
not ratify these protocols. We didn’t because ship owners
and the oil companies torpedoed the US efforts to ratify. They hoped that they could
use existing voluntary funds, called TOVALOP and
CRISTAL instead. Well, they were fooled. Instead they got
OPA 90, which had many features they don’t like. Now there is
unlimited liability, no preemption of states. It’s easier to break what
limits of liability you have. Again, we got to where
we are by the reluctance of responsible people to
take responsible action. Now OPA 90 has as its
premise in this area that the spiller pays. The spiller, meaning the
ship owner, pays first. They pay quickly, and
they pay with certainty for cleanup, compensation, and
restoration of the environment. As a result of this,
the Coast Guard has set up the
National Pollution Fund Center, which manages a
$1 billion trust fund. Money accrue to this– money is accrued to this
from $0.05 a barrel, $0.05 for every
42 gallons of oil either produced or imported
into the United States. We’re almost at the $1
billion level right now. That takes the place of the
International Fund Convention. There is a liability for a
ship owner of $1,200 per ton as the first level. This is about $150 million
in liability for the owner of a very large crude carrier. The ship owner also
has to prove that he does have the assets
to meet this liability. And because of the
nature of OPA 90 and the fact that we did
not ratify the CLC and fund protocols of 1984,
it has been very difficult to get this insurance,
something we’re working on. I think internationally,
this is probably the major problem facing
shipping and insurance right now. We’re hopeful with some
meetings coming up in Washington with the insurance and shipping
industries in early July we can get around this. But again, we’re where we
are because we didn’t take responsible action in the past. Now finally, to talk
about enforcement. The Flag State
Implementation Subcommittee met for the first time
about a month ago in London and came up with
some requirements, we are seeing a
proliferation of flag states now, states that have
no infrastructure, but are flagging
ships under their flag claiming they’re meeting
international conventions. They have no knowledge
in their government to say that, in fact, these
ships meet these standards. They then delegate this to
a classification society. We have a very
great proliferation of classification societies now. Not the Norske Veritases, the
American Bureau of Shippings, and the Lloyd’s Registers of
the world that we’re used to, but ones, again, that have no
real infrastructure, nothing behind it, no surveyors
dedicated just to them. So we’re seeing the
parts of a safety net. We’re seeing more owners that
are banks, that are management companies, not the
old time ship owners that we have seen in the past. So what we are seeing
is ships falling through a series of
safety nets, the owner not being responsible. Hopefully, the new International
Safety Management Code will help a great deal in that. Next is the flag state
not being responsible. IMO has passed a
resolution that we’ll vote on in London in October to
provide standards of what you should be to be a flag state. Some countries,
developing countries say it’s their
God-given right to have a commercial fleet of their
own, and the shipping industry is willing to go to that,
because the control is less, taxes are less, and
they can hire just about anybody they
want to as a crew. Well, that’s fine as long as
they stay in their own waters. But when they come
into other waters, there’s certain requirements
they have to meet. The IMO is going to
pass a resolution to say what they are. Classification societies. Up until now,
there’s been nothing to define what IMO and
treaties call a recognized classification society. That is going to change with a
resolution saying what it is. Let me say, I’m very pleased
that the classification societies under their
International Association I Acts are putting together
a self-auditing mechanism under ISO 9000 to see what
their level of quality is. The IMO is
participating in this. Unfortunately, the
insurance companies who have complained about the
work of the classification societies have not
seen fit to join in, although it’s been requested,
and the classification societies have offered
to pay the money. Then finally, we
have the insurance companies, who in
the past, I think, have not taken a responsible
look at insurance of ships. If you drive a
car today, you pay on the basis of whether you’re
male, female, how old you are, whether you’re married,
what route you drive, what zip code you
house your car in. Much insurance for
ships in the past was just based on
it being a ship. To their credit,
insurance companies are now starting to take a
much closer look at this. But I think the thing boils
down to the first safety net that we’re talking
about if we want to keep OPA 90 from happening. And that is response the
responsibility of the owner and the crew of the
vessel, because if they do what they’re supposed to
do, none of these other safety nets come into play. What I’ve tried to do is give
you an overview of what I see the issues are, how we
got to where we are now, and some of the things
that I think we need to do in the future to improve it
so we keep our 535 members of the US Congress from, again,
writing the types of law that Hank indicated perhaps
they shouldn’t. Thank you very much. [APPLAUSE] MARCUS: Thank you,
Admiral, for getting us off to a great start. Our next speaker is
Epaminondas Embiricos, chairman of Embirico
Ship Brokers Limited. And I’m delighted he could come
here from London to be with us, and we’re looking
forward to your comments. EMBIRICOS: Professor Marcus,
ladies and gentlemen. A key goal of the Oil
Pollution Act of 1990 was to reduce oil pollution to
the maximum extent possible. It is ironic, therefore, that
certain provisions of the act inadvertently tend to have
the very opposite effect. These same provisions are
also harmful to US interests in other respects. I shall seek to
explain why this is so, and I shall outline a
possible remedy which would address some of
the defects of the act, and thereby render its
goal more attainable. It may help if at this juncture
I made some comment about some of the relevant
provisions of the act for those who are not
familiar with them. Under prior law, ship
owners had the right to limit their
liability for pollution damages pursuant to the
Limitation of Liability Act of 1851. OPA 90 eliminated
that right for all claims arising out of
oil spill incidents. Liability for an oil
spill under the act is on a strict liability,
no fault basis. In other words, a
ship owner is liable if oil spills from his vessel,
even though he and his servants were in no way at
fault. The ship owner is liable, for example,
even though the fault may have been that of a US pilot. OPA 90 furthermore
expressly eliminated preemption of state
law by federal law for oil spill incidents,
thereby permitting states to adopt their own oil
spill liability regimes, many of which now provide
for unlimited liability. Although in theory OPA 90 still
gives the ship owner the right to limit his liability
under federal law, albeit at higher
levels, this right is in fact, illusionary
since limits under the act are very easy to break,
thereby leading to what is in effect unlimited liability. Thus, since OPA 90
came into force, a ship owner trading
to the USA is faced with the prospect
of unlimited liability in the case of an oil spill. This fact must be
seen in the context of the potential costs of oil
spills in the United States. The Exxon Valdez
oil spill cost Exxon well in excess of $2 billion. And this, of course,
was before OPA 90 and the broader definition
of environmental damage which pertains today. We now come to the
nub of the matter. Unlimited liability
is uninsurable. In fact, the maximum
insurance that is available to a ship owner
today for oil pollution liabilities is $700 million. Any ship owner who chooses to
trade to the States the day does so on a seriously
underinsured basis. The under insurance
is so severe when compared to the potential
multi-billion dollar liabilities that in the
case of a serious oil spill, a ship owner is, to all
intents and purposes, trading uninsured. Furthermore, the
uninsured liabilities are of a magnitude that dwarfs
the net worth of even a large ship owner. Not only is the owner
uninsured, however, but he is in a jurisdiction where
the courts have a propensity to seek to pierce
the corporate veil. Thus, in effect,
the United States is inviting those
shipowners whose service her needs to come and
play Russian roulette. Tanker owners are, of
course, most at risk, but all ship owners are exposed. For example, any vessel can
be in collision with a tanker, thereby exposing her owner
to unlimited liability under state law. The collision between a bulk
carrier and the British Trent is but a recent example
of the potential danger. I put it to you that these
are not desirable consequences that one would expect to
flow from a responsible, well thought out law. This state of affairs
should be contrasted with today’s international
regime, where limitation of liability is
fully recognized at levels well within the bounds of
available insurance cover. Bear in mind that US trade today
depends on foreign vessels. 80% of US petroleum imports are
carried by foreign ship owners. The consequences of
OPA 90 are predictable. Responsible owners will either
be driven from US trades, or alternatively, they
will be encouraged to behave irresponsibly. I know that some say that OPA
90 has succeeded in as much as the world shipping
community has continued trading to the US, that, however,
is a shortsighted view. The very large volume of
US imports and exports makes it impossible
for ship owners to withdraw from US
trades in the short run. After all, they have
acquired vessels on the basis of the existing
volume of world trade, and they have no
alternative today but to employ those vessels. I shall tell you, however,
what is currently happening, and how matters will evolve. Ship owners are
avoiding ordering the types of vessel
which would need to trade to US destinations,
such as, for example, Suezmax tankers. Future US trade will be
affected accordingly. The problem is
further compounded by OPA 90’s provisions, which
require that new building tankers must have double hulls. Double hulls are a good
pollution preventing design in the case of low impact
groundings or collisions. They increase the likelihood
of a catastrophic oil spill, however, in the
case of a high impact grounding or collision. This is because the empty,
uninverted tanks make capsizing and explosion more likely. Exxon carried out a study after
the Exxon Valdez grounding and concluded that
had the vessel been of double hull design, she
would have capsized and lost all her cargo. The double bottomed Aegean
Sea exploded shortly after grounding with the
loss of all her cargo. The Maersk Navigator was
involved in a collision and was struck in way of
a segregated ballast tank. She was, in effect, double
hulled in that area. She promptly exploded. The empty tank resulted
in greater instead of less pollution. These accidents should be
contrasted with the grounding of the Braer in the Shetlands. The Braer was of conventional
single hull design, and even though after grounding
she was buffeted and pounded for days by hurricane
and gale force winds, she did not explode. Of course, she finally broke
up, but had a salvage operation been possible earlier,
most of her cargo would have been saved. The reality of the situation
is that ship owners are required by OPA 90 to
build double hulled vessels for the US trades in
the full knowledge that in the case of an
accident, this type of vessel is more likely to lead
to a catastrophic oil spill for which the
owner will be liable, and for which he
will be uninsured, thus resulting in his ruin. It is not surprising, therefore,
that ship owners are not queuing up to build $100 million
dollar VLCCs when they know that not only can they
lose their investment, but be bankrupted to boot
if an oil spill occurs. All this does not augur well
for the future servicing of US trade. There is developing a trend
of long-term disinvestment in the types of vessel
required for US trade. Even assuming, however,
which I do not, that serious ship owners
will continue in the future to trade to and
from the US, OPA 90 does not serve
American interests well in as much as some
of its provisions are inimical to its key aim,
the reduction of oil pollution. It is axiomatic that
the businessman involved in a high risk business
will be acting irresponsibly if he operates
substantially uninsured. To create a situation where
he is bound to do so cannot but breed irresponsibility. If ship owners are forced to
act irresponsibly in this way, it is unrealistic to expect
them to act responsibly in every other way. Yet to avoid oil pollution,
responsible behavior needs to be encouraged,
not discouraged. It is never wise to demand the
performance of the impossible. Ship owners trading
to the states will be either discouraged
and despondent, or they will have an
indifferent, fatalistic, could not care less attitude. In either case, the likelihood
of oil spills is increased. Perhaps more
importantly, however, it seems to me that where the
potential uninsured losses are not only vast, but are
also third party liabilities, the government has a duty
as a matter of public policy to ensure that insurance
is not only available, but is also compulsory. One would not expect
the government to condone motorists driving
their cars without insurance, yet those liabilities are
minute compared to potential oil pollution liabilities. The United States should, as
a matter of public policy, not permit a situation
to exist in which all her petroleum
imports are carried by substantially underinsured
vessels, let alone to create such a situation. This brings me to the remedy. The US government should
require that all tankers trading to the states carry insurance
to a very high level, say, $2 billion. Compulsory insurance
to such a level is necessary to avoid a
situation in which those ship owners who take
out such insurance become uncompetitive and are
driven from the US trades by other less
responsible owners who are willing to take a chance
and trade on a substantially underinsured basis. Understanding that
the market may not be able to provide capacity
up to say, $2 billion in short order, the
higher mandatory amount may need to be phased
in over a period of time from the currently
available $700 million, the mandatory nature of
the insurance creating a sufficient premium
base to allow higher levels of insurance
to become commercially available in due course. Alternatively, the
federal government should mandate a
supplemental insurance regime similar to that currently under
consideration for the aviation industry in the proposed
legislation implementing the Montreal Protocols. The premiums should be
charged on a per voyage basis, enabling the ship owner
to pass them on down the chain, and thus ensuring that a
proper level of premium can be paid for the necessary
cover to be made available. In this way, the main
defect of OPA 90, that of the uninsurable
liabilities it created, would be largely
addressed, and the act would be strengthened
significantly. There would be another
benefit as well. Currently to the extent that
ship owners are underinsured, all uninsured cleanup costs or
claims associated with an oil spill will be paid by
the federal government from the $1 billion federal
oil spill liability trust fund created pursuant to OPA,
thus the federal government has a direct and
immediate interest in all shipowners having
adequate insurance cover. Nevertheless, there is, I
understand, some reluctance to tinker with OPA. If that is a legitimate
concern, the remedy which I have suggested
could equally well be achieved by
freestanding legislation. Proposals along
these lines have been made by the international
shipping community as long ago as January, 1992. But surprisingly, a response
from the US government is still awaited. There is yet a
further aspect of OPA which is relevant and
is worth mentioning. The scope of OPA includes
all damage claims, both public and private,
arising from an oil spill, and permits all claimants
to pursue direct action against the ship owner’s
liability insurance. OPA 90 was intended, in addition
to minimizing oil pollution, to provide an effective
response and compensation system in cases of oil spills. Financial responsibility is a
central component of the act. Tanker owners trading
to the US must have certificates of
financial responsibility to cover an amount up to their
theoretical limit of liability, which certificates must be
subject to the direct action provisions of the act. The marine insurers that cover
a shipowner’s third party liabilities, known as
protection and indemnity clause, when faced with the
expanded scope of liability under OPA, both with respect
to limits and claimants, have not surprisingly
refused to provide the necessary certificates. Interestingly enough, no
US insurer, and certainly, no other foreign insurer,
is willing to provide these certificates either. Without the backing
of their insurers, practically no shipowners have
access to financial resources sufficient to
obtain certificates of financial responsibility. Without these certificates,
ships cannot enter US ports. OPA 90, therefore,
created the real risk that US trade would
grind to a halt. Faced with this dilemma, the
Coast Guard understandably has delayed promulgating
the regulations implementing OPA 90 in this respect while
it searches for a solution. A solution has been put forward
by the international shipping community, which has proposed
that the government mandated supplemental insurance facility,
which I referred to before, be subject to direct
action and provide the backing necessary for
the issuance of certificates of financial responsibility. Yet the problem
is still with us. A solution to the
question of certificates of financial responsibility
will have to be found. In seeking such a
solution, the Coast Guard has the opportunity
also to solve the much larger
but related problem of inadequate insurance,
which places both ship owners and the US government
in serious financial jeopardy and leaves the
environment at risk. We must hope, therefore, that
this issue will be addressed in the near future, both
by the administration, and by the Congress. Thank you. [APPLAUSE] MARCUS: Thank you very much for
that shipowner’s perspective. I think it’s safe to say we’ll
have an interesting question and answer period. Stay tuned. Next, we have Richard
Quagen, general manager, marine department
Texaco to give us an oil company’s perspective. QUAGEN: Good afternoon. It’s a pleasure being here. Not being an alumnus
of MIT, I think I’m one of the only
people walking around with a badge with no number. And somebody asked me why
there wasn’t a number, I said I was still working
on my degree after 35 years. But I’m here to talk about the
oil spill issues of the day. And if you can turn
the slides on, please. As of where we
stand in June, 1993. I’m going to talk from an
oil company perspective, both as the cargo owner, and
as a tanker owner ourselves. We, like most major
oil companies, operate our own fleet. We do a considerable
amount of chartering with independent owners. And I’ll briefly bring you
through a little history to tell you how we got where we
are today, what we see as some of the problems, and
some of the things we’re going to have to do. I will refer to OPA 90,
but I won’t dwell on it since it’s been covered so
extensively by our previous two speakers. The tanker industry,
and specifically, the oil company segment
of that industry is, in fact, an
industry in transition. The changes in the
oil industry itself in terms of ownership of the
oil, location of refineries, location of production,
increasing regulation and whatnot, have
changed the role of the green departments,
the tanker departments of the various companies. One of the things
that brought us to the situation we’re
in today is the history of oil movements in the world
by tanker in the past 20 or so years, 30 years. As you see, the oil
movements peaked in the early 70s at a
time where everybody was afraid there
wouldn’t be enough oil to last through the
end of the century, and where prices were creeping
up towards $35 to $40 a barrel, with projections that oil would
cost as much as $100 a barrel by the 90s. The conservation
methods that kicked in as a result of
that high price brought a drastic reduction,
particularly in the Middle East, the blue segment of the
chart, which is the long haul segment of our oil
industry, resulting in the early 80s of a depression
in tankers, principally, because the industry reacted to
that projected increase of oil movements by undertaking a
tremendous building program, particularly in the very
large crude carrier. The independent, seeing the
need by the oil companies to move that oil,
joined the oil companies in this building orgy. A lot of the tankers that
were built by the independents were in fact taken on charter,
term charter as long as 20 years by the oil companies. In 1978, ’79, the major oil
companies therefore controlled about 60% of the tankers,
either through ownership, or long-term charter, that
were plying the oceans route. Again, as the demand fell off,
a rather severe depression that lasted through the
1980s developed in the tanker industry because there
were just too many bottoms chasing too few cargoes. That lasted right
through the end of the ’80s, when briefly a
somewhat healthy resurgence took place as the supply
and demand of tankers became more imbalanced. That unfortunately resulted in
another wave of new buildings, thereby increasing the
number of [INAUDIBLE] and resulting in 1992 being
a very depressed year. As you can see, the construction
of tankers peaked in the mid to late ’70s. With the depression, the
order book literally dried up. A good part of the world’s
shipbuilding capacity virtually disappeared. In Japan, about 30% to 35%
of the shipbuilding capacity was actually destroyed. In Europe, many of the
major shipbuilding companies are no longer in the business. As the depression
went through the ’80s, the number of scrappings
increased dramatically. We, in fact, Texaco
scrapped VLCCs that were less than
10 years old that we had built for $25
to $30 million, and just turned them into
razor blades for about $4 to $5 million. But we had to do it because
they were all sitting in mothballs rusting away. As we got into this
little healthy period in the late ’80s, again,
there was a minor resurgence, but a significant enough
resurgence in new buildings, and, equally importantly,
an almost disappearance of the scrapping, resulting
in a current continued oversupply of tankers. This is reflected
in recent years in the freight
rates that are paid to the tanker owner, either
the oil company owner or by the oil company
to the independent. In 1990, we’re fairly healthy. The blue line
represents a VLCC going from the Persian Gulf
west, either to Europe or to the US Gulf. The red line is a Caribbean to
the US, a 30,000 ton product carrier. And you can see the effect
on Operation Desert Storm. In 1990 and nearly ’91,
there was a very great surge in rates. It didn’t last, and ’92
became a disastrous year for not only the independents,
but the marine functions of the major oil companies. And today, the
major oil companies control directly about
20% of the tankers, compared to the 60% I
referred to in 1973. They charter in on a voyage
basis, a single-voyage basis, perhaps another 15%. So as we go through
this brief chat, keep in mind that the influence
the oil companies have on the tanker industry has
diminished significantly over the past 20 years,
with greater influence going to oil-producing
countries, who tend to move their own oil, and oil traders. Unfortunately, over my
lifetime in the industry, which is over 30 years
now, there have been a series of accidents
that have dramatically caught the public’s attention,
and starting with the Torrey Canyon is probably
the first one, off the south coast of the UK. That was the first big spill. That was the first
tanker that broke up that was of a size
that really could spill a great deal of oil. The Amoco Cadiz and,
locally, the Argo Merchant in the late ’70s again
caught the public’s attention as to the risk that was entailed
with tankers carrying oil into the United
States or into Europe. And most dramatically,
the Exxon Valdez in 1989 has changed our lives
in the industry forever. Given that, and referred
to I think by Hank before, tanker accidents
cause a very small portion of the oil that makes its
way into the environment on an annual basis. The greatest single
source of oil is the industrial
sewage type of disposal. An environmentalist
told me at one point that there was the equivalent
of approximately 20 Exxon Valdez going into
the environment every year by people dumping
lube oil into the sewer, into the ground. Tanker operations,
the bunker spills, less than scrupulous
owners discharging oil over the side at
night type of thing again represents a fairly small
part, but a significant part. Of those tanker
accidents, the statistics have shown continually that
over 80% of the accidents are caused by human failure. And I suspect that some
of the other categories, such as equipment
and structural, is indirectly a result
of human failure, which tells us that this is
where we have to look. One of the unfortunate
aspects of the OPA in terms of the financial cost is that it
is extremely expensive in terms of reacting to a spill. And I don’t think
nearly enough directed towards the
prevention of a spill, through training and
certification of mariners. The Oil Pollution Act, as,
again, previously stated, attacks– addresses– that was a
Freudian slip, I think– addresses several aspects
of tanker operations. Certainly the construction
through double hulls, tanker safety through licensing,
the pollution liability, which has been talked
about, contingency plans. And I’ll refer
back to this later because this is one of the
positive areas, I think, that has come out of the act. And financial responsibility,
which has been said is certainly currently
the nuttiest problem we have on trying to
resolve this issue. Texaco and the oil industry,
the tanker industry within the oil industry likes
to talk in terms of the four Ps that we have to adopt
in order to address the current situation. One of the things we have
to realize, and we do realize, it’s not the same game
that it was five years ago, 10 years ago, or 20 years ago. The world, as far as we
are concerned, has changed, and we have to recognize
it and change with it. Prevention, protection,
participation, and perception. Prevention. We have to do what is
necessary to prevent the accident from having
occurred in the first place. And you talk about the billions
of dollars required to clean up a spill, we have to
concentrate on not having that spill in the first place. One of the ways is through
proper maintenance of ships. One of the results of
those previous graphs you saw on building
and scrapping is that the average age
of the world tanker fleet is getting old. The great bulk of VLCC
capacity was built in the ’70s, and is approaching 20 years old. Now, the sea is a very hostile
environment, as many of you know. It’s a very
corrosive environment in terms of the salt. VLCCs
rounding Cape of Good Hope continually year after year,
taking fairly good stress and strain, as going
through the heavy season that area of the world. It’s absolutely
imperative that companies address the maintenance
of their tankers to make sure they are up to
the absolute best condition possible. Again, as Admiral Kime
referred to earlier, we are working very strongly
with the classification societies to increase
the inspections of ships, to increase the rate
of renewal on steel to make everybody come up with
the best maintenance possible. Training. I think that there’s no
substitute for training. This particular side shows
a firefighting school at Texas A&M
University, and Texaco, and other shipping companies,
not only oil companies, use. Again, you may have heard in
the paper yesterday or today or seen on television the
explosion of the British Trent, a BP product
tanker carrying gasoline that reportedly collided
with a non-tanker and immediately exploded. All 30 odd crew member had
to abandon ship immediately. 22 or 23 may have survived. Fire is the thing that is
dreaded most aboard tanker. There’s no place
to go when there’s a fire, unless you put it out. But this type of training has
the added advantage not only of teaching how to people to
react to a crisis aboard ship, but it instills
in the individuals a consciousness of safety. [INAUDIBLE] master
of those skills that are necessary
to operate a ship. These courses,
which last a week, are basically crises courses. We teach ship management, bridge
teamwork, the passage planning, the ability to get
the ship from A to B, trying to anticipate all
possible contingencies. And then, as the
exercise is going on, throwing in some
unexpected development, just as going
between a breakwater, the captain has a heart
attack and the chief mate has to take over. Does he know what
to do, how to do it. A ship that has
radioed that it’s going to act in a certain
way, acts in a different way. By doing this on a
simulator, obviously we get the benefit
of the experience without going through the
real thing, which we never want to do. The crews on the
ships are becoming increasingly important. Again, go back to the
80% manpower failure. We firmly believe in
Texaco and other majors that the manning is becoming
increasingly critical to prevent accidents. We hire crews on
a permanent basis. In other words, become
employees of the company. We go through training. This is a photograph
happens to be of our newest tanker, the Star Ohio, a
double hulled 150,000 ton crew carrier delivered in
Korea last October. The officers are
Italian nationals. The senior officers have been
with Texaco over 20 years. The junior officers a
proportionately length of time. The Filipino crew have been
with us for several years. We’re proud that there’s
less than a 5% turnover among the Filipino crew. And we’re proud of that
because we spend a lot of money on training the crew. We don’t only concentrate
on the officers, although we certainly focus
on them very strongly, but we also train the crew. And it’s important,
we feel, that we develop this sense of
loyalty to the company that the same individuals
will keep coming back, working as a team and working together. One of the things that we do
in our inspection program, and we, like many other
majors, have an inspection program where we
actually physically go aboard an independent
ship and put it through a rather
rigorous inspection before we will utilize a ship. One of the things we’re
focusing on more and more, again, is the manning policies. In that depressed market in
1992, for an independent– and not all of them
did it, but some did, enough did to cause a problem– if you have a lower
income, the quickest way you can reduce your costs
is lower maintenance and go after the cheapest
possible crew you can find. And several of the ships that
had recent accidents we turned down on inspection because
we felt that the owner had compromised too much on
his manning, and in effect was hiring casual labor. And we just felt this
was totally unacceptable. We will continue to find
it totally unacceptable. Protection. We accept that we have an
enormous responsibility to protect the environment, to
protect the natural resources not only of the United
States, but of the world. We do a lot of
drills aboard ship. This happens to be
an abandoned ship drill with protective gear,
but we do firefighting drills, simulated drills of
individuals getting caught in enclosed spaces and whatnot. And through the
constant drilling, again, we attempt to instill the
spirit of safety, the thought of safety throughout the crew. We know the environment
is our responsibility. By the way, I put that
slide in because when I went to see– the
thing I used to love to do when going through the
South Atlantic or the Pacific Ocean was stand on the bow
and watch the dolphins kind of racing up ahead of the ship. So that was from me. The industry has funded to the
tune of $1 billion the MSR, Sea Spill Response Corporation. This is a corporation
that has been set up. It is run by ex
Coast Guard officers. It has been equipped with
about a half a billion dollars’ worth of equipment in terms of
skimmers, barges and whatnot. It will be, and it is
in the process of being, strategically located to
complement the Coast Guard’s capability around the country. It will be available in
the event of a major spill. It is going to be, I believe,
a Cadillac spill response capability, and one
that hopefully we’ll never have to use. Participation. We have to recognize
in the industry– and I think we have
recognized– that, again, as things have changed
over the years, we’re not so much a private
business as we were. We have partners. The US Coast Guard
in the United States is certainly becoming a
partner in our business. And internationally, regulatory
agencies throughout the world are. One of the good
things I refer to in OPA, when the Coast Guard was
required to prepare regulations for contingency
planning aboard tankers, they invited through a
regulatory negotiation process, the reg-neg process, all
segments of the industry to sit around the table–
environmentalists, unions, oil companies, independent
ship owners, spill response companies, state
government representations. And over a period
of several months– with a great deal
difficulty, I might add– they reached a
consensus on what should be the capability of
a tanker to respond to a environmental incident
in the United States, through contracting
for spill equipment, defining what is a
logical or likely spill. It didn’t make anybody totally
happy, I don’t believe, but it made everybody
partially happy, which is probably as good as you
can get under the circumstance. But I do commend the
Coast Guard, again, when the results of that
reg-neg have been questioned or attacked by
members of Congress for their own
particular reasons, the Coast Guard has
stood up very strongly and defended the process and
defended the regulations. We also have to recognize,
as oil company charters and owners, that
we have partners in terms of the independents. The oil companies
have been in the past, and across the board,
been accused of having a certain amount of arrogance. And I think that was true. We will tell you what to do,
we’ll tell you how to do it, and that’s it. Otherwise, we won’t
work with you. But I think now we do
really have to work with the independent owner. These concerns that we have
about safety and manning and training, we have to work
with the independent owner to make sure that we feed him
what we can in our experience, and on the other
hand are satisfied that the owner is doing what he
can to meet those requirements. We have to be partners with
the regulatory societies, the classification societies. Again, we all have
to work together, or we’re all going
to go down together. And perception. The perception of
the oil industry in general and the
tanker industry specifically is a
very, very poor one. There’s absolutely no attention
paid by the media or the public to the millions and millions
and millions of barrels that are transported safely every day
in and out of the US and around the world– in and out of
Boston, for that example– without incident. The amount is phenomenal. Yet, when we do
have an accident, we get front-page press
and evening news shots, and the perception is negative. We would like
reception to be this. And this is what our goal is. And I frankly see no
reason why it can’t be. I mean, those of us that have
gone to sea, whether it’s in the Merchant Marine,
the Navy, the Coast Guard, or private boats
or whatnot, you know, love the sea. It’s our livelihood. I spend some of the happiest
years of my life sailing, both on yachts and then in
the Navy and on tankers. And I will do anything to
prevent damage to the sea. And the industry
has that feeling. Our problem is that we
are unable to get that across to the public. And through [INAUDIBLE]
such as this, this is what we are
attempting to do. Again, even though the
slide shows a very calm sea with a beautiful sunset,
somewhere in the mid-ocean, we recognize that there are
a lot of problems ahead. A wise captain once told me
something I never forgot. He asked me when I was
on watch as a second mate where the nearest land was. And I very smartly
pointed to an island that was about 50 miles
off our port bow, and he said, no,
it’s right under you. And I never forgot that. So even though we
see a calm sea ahead, we know that there’s a lot
of reefs and problems there. And we’re working
very diligently to try to avoid them,
and trying to work with you and with the
government to provide a safer environment for all of us. Thank you. [APPLAUSE] MARCUS: Thank you
very much, Dick, for the oil company perspective. Batting cleanup today,
we have Lisa Martinez. And it’s always a delight
for me to share the podium with a former student. Lisa. MARTINEZ: He says
the sweetest things. Thank you, Hank. I’m supposed to be the
cleanup, and ironically, I’m the only one on this crew
that has never been involved with an oil spill cleanup. So the cleanup is purely
a figure of speech. I’m also supposed to provide
the broadening influence and the context. So for starts, let me wave
in your general direction a 1926 US government report
entitled Oil Pollution of Navigable Waters. So my first element
of context is time. Though we fret about
this, this is not an absolutely new problem. It’s one which we think we
have solved a number of times. And my comments are
essentially going to tell you, from
my point of view, as I represent no
organization other than myself and my computer, what
I find tolerable, what I find intolerable. And what my biases are will
become immediately clear. My first context
parameter, if we’re going to use these MIT
words, is oil spills in the context of issues
facing marine transportation. It’s not the most
important problem we have, and I can barely tolerate
the constant attention that oil spills get. By several measures, we have
far more egregious situations facing this industry. And by example, I will give
you the events of January 1993, which I looked up in a fairly
reputable series of journals. The Braer, 1993, Shetlands– no crew lost. All crew rescued. Cargo, total loss. Vessel, total breakup. The [? Cody ?] [? 1– ?]
have you ever heard of it? A cement carrier, went down
with all hands the same week as the Braer. The– I can’t even
pronounce this– [INAUDIBLE] a Polish flag
[INAUDIBLE] cargo went down. Over 50 people died. These were all events
in the same month, but I would conjecture that, to
the public, the only one that’s recognizable as a marine
casualty was the Braer, even though there
was no loss of life. As a member of
this profession, I find that distortion really
intolerable on any kind of a permanent basis. The other effect that this has
as a member of the profession is that it distorts– and I use these words quite
deliberately– the way you get to work in
this profession. Oil spills attract
a lot of attention, but there’s only
a limited number of maritime professionals
and there’s only a limited number of
naval architects, and therefore other problems
go waiting or go unnoticed, even though we have
the statistics that should drive that
work to tell us that those are the more
important things for us to work on. The other kind of
distortion that it does is it puts us in
a reactive mode. Yes, the Oil
Pollution Act of 1990 was a reaction to
a series of events, but it bears almost no
mark of the initiative of which I know my professional
companions are capable. Now, the other kind of context
that I want to put this in is the context of oil
spills in the larger context of marine pollution,
even in marine pollution from ships. I’m the only one on this panel
that works almost exclusively on stuff besides
oil, but it’s worth reiterating Bill Kime’s remarks
that we have a legal regime, and that we’ve talked
about that legal regime in the context of oil. I will remind you
now that it also covers bulk chemicals
carried in liquid form, packaged goods
carried in containers and other forms of boxes. It also covers solid
waste and garbage, which you probably recognize
as the plastics pollution. In the United States, we
also have controls over sewage from ships. And meanwhile, while
we are meeting here, both at the international level
and at the national level, we are working on new
agreements and new controls on air emissions,
both from the cargos and from the propulsion
plants of the ships. There are proposals for a
new international convention on solid cargoes,
such things as grain, taconite, all the things
that bulkers carry. And there is a lot
of interest right now in controlling the discharge
and the uptake of ballast water. Now, I find this
all kind of ironic– and I can say this
in this crowd– we’ve spent the
last umpteen years getting the ballast water clean. So we finally have
it to the point where we’ve now established
aquarium conditions, and you go from one
continent to the other and you transfer living
organisms quite successfully. So I feel like the
agenda is changing, and we need to be aware of that. But it is valid to say that
oil spills trigger very intense reactions in people, and
therefore they do tend to rivet the attention of the general
public in a way that a number of these other issues don’t. So I think it’s valid to say
that one of the oil spill issues is the way it
rivets the attention. The director of the
Monterey Bay Aquarium used a phrase that I just love,
and I repeat it everywhere. She says it’s
charismatic megafauna. The reason people get emotive
over the notion of oil spills is because they can relate. Those wonderful seals, all
the damage is the megafauna. And we also heard
some indication today of what I dub today
charismatic megaflora. I mean, clearly when you were
running the America’s Cup, you had to find out
where the kelp beds were. OK, so I’ve now included
charismatic megaflora in the jargon here. But all of those demand
really very little attention to grab your attention. If you’re going to focus on
the problem of oil spills, if you’re going to focus on the
problem of marine pollution, you have to incorporate the
nuance that Sylvia Earle was talking about this morning. You can’t be satisfied
with a short attention span or a short information span. We can’t use two or three
years of data to say it’s OK or it’s down the tubes. In fact, this year, for example,
at the Ocean Engineering Department, there’s a gentleman
doing some work on ship wakes, because it turns out you
can see ship wakes for hours after the ship is gone. Now, this tells me that there
is something dynamic happening in the surface
layer of the ocean that we’ve never acknowledged. I don’t know what
it is, but it sure has something to do with
the surface dynamics of what you’re looking at when you’re
looking at an oil spill. So therefore, I would like
to also say that I personally can no longer tolerate
the notion, which seems to be the abiding dogma,
that the open oceans are not our principal concern. If you look at the
way we have structured our international regimes
and our national regimes, and to a certain extent
our shipboard technologies, we’re focusing on
protecting the coasts. To an increasing
degree, the data that’s coming in on
the middle of the ocean tells us that is not
necessarily a valid conclusion. What that tells me as an
engineer is that gives me the opportunity to change
from an end-of-the-pipe kind of a control system to a
work-it-from-the-beginning kind of a thought process, so that
you don’t have a high level of pollution coming out of a
ship at any point during its operations. Hank mentioned earlier another
important point of context, and we saw the slide
which shows that ships are, in fact, not the
dominant source of oil or the dominant source of
pollution in the ocean. This is an important
statistic, but, in fact, it doesn’t matter. We are responsible for ships,
it is our job to do the best job we can cleaning up the
operations of ships, and if those poor people on land
cannot get their act together to do the same, perhaps they
should look and see what we have accomplished
and learn from us. And I mean that quite literally. We have existing
international agreements, and I understand that
after the Rio summit there’s lots and lots
and lots of things ruminating about land-based
sources of ocean pollution. We have a few models, we
have a few precedents, we have a few
incidents and examples of things to implement
that are worth taking a look at because they’ve
got a lot of hiccups and a lot of problems
in them, but they are moving in the right direction. Specifically on the topic of
regimes and things like that, I also want to be very clear
on one of my other biases, which is that once I
found this 1926 report– and it has all the
elements of any report that you would write now– I have to state that I can
no longer tolerate the notion that we should be cleaning up. I’m working now towards a
different performance standard, at least conceptually. The notion of less worse
doesn’t make it for me anymore. It may be a 30- or
40-year achievement, but we really have
to start thinking about a different ship. The notion that oil
leaked and caused problems was on the books 70 years ago. It’s not a new surprise. It shouldn’t surprise us
when these events happen, and we should be able to
engineer our way at least so that we can
respectably stand in front of the congressional types and
say we have thought about this. Now, leads me right into
my next statement, which is we’ve heard a lot of remarks,
quite experienced voices speaking, about the problems
with the Oil Pollution Act of 1990 and the 535 budding
Naval architects in Congress. You should be alarmed. And I’m telling you why. You should be alarmed because
this shift in power is real. The shift in power away
from this profession and to the legislature
is something which– can we talk here– they like it that way. In the context of oil
spills, I understand that the anxiety attacks
are coming on largely in regards of how to cope with
the outrageous demands that have been placed. However, all discussions
regarding ship-source pollution have been changed by this
discussion of oil pollution and oil spills. I have personally been involved
in discussions on air emissions from propulsion plants,
garbage handling on board ship, and ballast water where I
have seen congressional staff people talking about technical
demonstration programs and starting to design technical
demonstration programs. And they had neither
the background nor did they have the executive
branch people there who could help develop those plans. There is a comfort
level right now with intruding into the
practice of marine engineering and intruding into the
practice of naval architecture which, frankly,
gives me the willies. I consider myself an
environmental engineer, though the title seems to have
gone to the civil engineers this year, and I don’t
understand the acquiescence or the overwhelming
steamroller impression that this has made
on the profession. Finally, therefore, my personal
stand is that it’s up to us as marine professionals
to integrate the criteria of marine
pollution prevention into the core disciplines
of this profession. Whether you’re an engine
designer, a fuel purchaser, a cargo handler, and
I don’t know what, every task that you
should undertake should have the opportunity
to at least articulate what the pollution
prevention needs are, the possibilities, and
whether you can execute them. We should not remain in
this reactive arrangement. We should not be constantly
retrofitting our fleet. It’s an exorbitant way
to deal with things. It’s also the old-fashioned way. Most of the other
land-based industries have gone through at
least one generation of pollution control, and
we are getting the old news. We aren’t getting
the best formulas for pollution prevention. We should certainly not wait
until the next legislature decides what the technological
fixes for your fleet or for your state, because
in the case of air emissions, these ships were being targeted
for action because the city was not in compliance with its– I’m doing this because it’s kind
of a bubble concept, you know, the ozone concept. It’s really hard
to bite your tongue when you feel like you’ve
just been plowed over, but recently there was a very
prominent professional group which had a meeting
in Connecticut. Shall remain nameless, but
the title of the session was– this is a quote– Bitter Medicine–
The Environment. Get a life, guys. This is not going to go away. This is not a sometime thing. This is not something you can
go hide in the locker room and it’ll resolve itself. Stepping away from
this issue will not resolve any aspect of it. In fact, labeling programs of
prominent maritime associations with titles like that
will only really give us the black eye that
everybody’s been waiting to give us for a long time. So what I say to you as a
community of ocean engineers and a community professionals in
general is get in line and work on the problem. You need to deputize yourself. There’s a quirk right
now which a number of us have come to grips
with, which is there’s no textbook on marine
environmental engineering. We’ve engaged a number of failed
attempts to put one together. If you work in this field,
publish your work, please. We need more documents
out there that aren’t marked Navy Secret to
tell us what we’re doing here. And in general, the plea
I would make to all of us as practicing
marine professionals is use your expertise. You may not consider yourself
an environmental professional, but you know more about
the way a ship operates than any of the
environmental advocates who are likely to come
in contact with you. And if you don’t volunteer
that information, guess what? I’ve learned in the last
couple of years a lot of people won’t ask you. But if you tell them, they
might actually appreciate it. So that’s my message. Thank you. MARCUS: Thank you. [APPLAUSE] Thank you very much, Lisa. You’ve done a great job of
clearing the bases here. I’m going to add one number to
your excellent presentation. And I’ll ask the audience here– Lloyd’s casualty data has
just come out for 1991, so I want you to think of what
the number is of lives lost just on those ships who
have been total losses, whether the ships have been
casualty, sunk, whatever. Total losses. How many lives have
been lost in 1991? Think it’s 100 or 200 or 300
or 500 or 300 or 800, 1200? More than 1200 lives lost. And I think the general
public has no idea, with the focus on
things like oil spills, that some of these
other problems still exist. Before I open up a question and
answer period to the audience, I want to ask the first
question to Admiral Kime. We have Mr. Embiricos talked
about the liability issues. There is something called the
regulatory impact statement, is that the right phrase? The Coast Guard is– KIME: Regulatory impact
analysis, an RIA. MARCUS: Could you bring
us up-to-date on that? KIME: Yes. At the time that
we were publishing our notice of proposed
rulemaking several years ago, the industry, the shipping
industry and the oil industry, went to OMB and said that,
before this can become final, we in fact think
certain questions ought to be asked as part of a
regulatory impact analysis. And a little bit
unusual, and in fact they gave OMB a list of questions. Now, the Coast Guard has
dutifully now published that list of questions,
and we have received a great many answers to those. We have sent the
regulatory impact analysis to the Department
of Transportation. They have signed off
on it, as we have. And we have also
sent it to the Office of Management and Budget. And it’s been there
about six weeks. And we are waiting
for that to come out. That will be out, we hope,
sometime early this summer. There will be an opportunity for
people to make comment upon it. Many of the comments
that Mr. Embiricos made are addressed in
some detail in that. There will be 60 days for
the public to comment, and then we would
hope to move on to finalizing the
rules at that time. MARCUS: Thank you. Questions? If I can see you. Yes. AUDIENCE: Mr. Chairman,
as a shipbuilder, and even an MIT-educated
shipbuilder, I would like to put some
attention to something. I don’t think has really
come forward here. We’ve had some very good
discussions on the operation thought to kill the patient. What type of operation? We’ve even heard of
some other sicknesses that we didn’t here
in the beginning. What I’d like to
put the tension to is perhaps the reason
for the sickness. And the reason
for the sickness– and there were very interesting
curves that you showed. But unfortunately, you did put
attention to the right things from the oil company’s
point of view. The reason is that we
have too many ships. The reason is that we have
oversupplied the global market in the ’70s through Japanese
and Korean expansion, through stupid
European subsidies, and we have continued
the misery in the ’80s by over-aging the fleet to the
tune of half a year per year. The average age of global
tankers and bulkheads, they are 15 years. You are quite correct in stating
that the [INAUDIBLE] was built or the [INAUDIBLE]
built in the ’70s. And you are quite
correct stating that if we looked at
the tankers today, there are 2/3 of
the tankers that I have the 20-years
classification [INAUDIBLE].. And many of them, through a
reputable company like yours are hopefully properly operated. But there are quite a lot that
are not correctly operated. The mystery today is that
we don’t get sufficiently in the transportation
sector, or we don’t get sufficient of the
value added of the cargoes. In 1990, the total global
value of cargo transportation was roughly $1 billion. Out of that, the ship
owners is about 6 and 1/2%. 20 years back in your period
of tankers, the price of oil was $2. The transportation
cost was $0.70. Today, the oil is priced
at what, some $20. The transportation
cost is still $0.70. Now I [INAUDIBLE]
talk about education. We could talk about
better crewing, we could talk
about better ships. But we need in the
global system an increase in the value added
to the ship owners to the ship operators
in order to do this. And this is today where
we have the mystery where all those old ships, because
these old rust buckets are pushing down the market. And if we don’t
solve that problem, we will not solve
any of these things that we’ve been
talking about here now. We must one way or another,
by torpedoes or [INAUDIBLE] [CROWD LAUGHING] Thank you. MARCUS: Thank you. I’d recommend against torpedoes. But your point is
very well made, sir. It’s a lot easier to do
all these extra things like training and
more preparation when you’re making
money, when you can afford to buy a brand new
ship with all extra features. When you’re losing money,
and most people have been losing money since 1973,
it makes it much more difficult. Any comments for– [INAUDIBLE]? KIME: Yeah, I’d like
to comment on that. I think it’s a mistake to
focus in on pure age of a ship. Like many other
pieces of equipment, an older unit can actually be
much better than an newer unit if it’s properly
maintained from day one. The fact that a ship
is 20 years of age just means that it’s
20 years of age. For example, I’m sure
there are many VLCCs built in the 1970s that
are actually better ships, in better condition than
some of built in the 1980s. Because of the economy,
again, shipyards went to high tensile steel,
cutting down the scant wings, the thickness of the steel
with the same corrosion rate as the thicker steel
in older ships. So again I, always felt it’s a
mistake to concentrate on age. It’s the operation of the
ship that makes a difference. MARCUS: Anything else? Yes Everett. AUDIENCE: One thing I didn’t
hear anything about is just navigating a ship. Now, [INAUDIBLE] with
someone who [INAUDIBLE] talking about the fact that
the navigation of a ship is [INAUDIBLE]
traditional, and that there are a lot of new
developments to make the navigation quite safer. For example, nowadays you know
just exactly where the ship is. But if you know exactly
where the ship is, but the people that
are navigating the ship aren’t paying any attention
to where the ship is, you can get way off course. But on the other hand,
it’s perfectly possible to have a– to decide
a course that you want. As for the ship, if you get off
of that course, and markings, and all that sort of
thing, it would now make the Valdez– that
was the primary problem, it was off course. And [INAUDIBLE]—- there’s no
excuse for that these days. MARCUS: Okay, the question has
to do with the impact of better navigation equipment, and
do we have no accidents or do we have
technology-assisted accidents? QUAGEN: I’d like
to comment There’s no question that the
biggest problems are not behind the wheel in any
mechanical and driven thing Yeah you can have all the
equipment in the world, but if you don’t have the
right people to man and operate that equipment. That ironically is
one of the problems that I think OPA and
perhaps in Europe, if they follow the same
course is resulting it. At a time where we should
be encouraging, as a country and as a world, the
finest young men and women to follow a career at sea,
we’re sending them a message by putting Joseph Hazelwood’s
picture on the cover of Time magazine, by jailing the
chief mate on the ship that was in New York Harbor
that ran into a rock 35 feet below the harbor
bottom because he did not see the rock. And it turned out he’d had
a beer the night before. He spent two nights in
jail, a British officer. The message we are
sending to young people– and I have three sons– is stay away from that business. I mean, you have nothing to gain
except a possible prison term. Again, OPA as
introduced in the states have followed very strongly
the criminal liability in terms of oil pollution. So I think that’s one of the
problems we have to overcome. How do we keep those individuals
that we spend millions of dollars in training
and have long services with the companies,
how do you keep them, particularly coming
in the United States, and in our cases, where
officers have refused to sail on ships coming into the
United States for that reason? And how do we attract
the new ones in? It’s maybe one of
our bigger problems. MARCUS: Lissa. MARTINEZ: Thank you. Everett, the comments
I would like to add are that if I heard
you, you weren’t talking so much about
navigation equipment as additionally the deliberate
skill of navigating the vessel. And, I mean, in this country,
Captain Gates has written a wonderful text called
God, Ship Accidents, I think is what
it’s called, where he talks about, in
essence, the loss of skill being the cause of a
number of accidents where standard ops can
be managed by a fairly routine, practiced event. It’s this skill of saving a
ship in a bad situation that was lacking in many of
these circumstances, not that it was an
impossible situation, but that the calls were
wrong, or the bank section was too extreme. Richard Cahill who is
actually an American, but who is published
in the UK, has written a couple of
wonderful or horrible depending on how you
look at these things. One is called Groundings. And the other was
called Collisions. And they’re case studies. And time and time
again, it’s a matter of pulling out the
old chart or not– making sure that the light you
were looking at was the light you were looking at. And those sorts of things
are sort of legendary. And from what little
I know as a spectator, it’s initiatives like the
bridge team management which will, if we’re lucky,
break through that impasse that when you’ve got
these horror stories, we’re all, hey, we could all
see it was going on the rocks, but the old man
was at the wheel, and we weren’t going to
overrule the old man, then you have to take
a look at bridge team management as
perhaps a solution. So I think that what
I’m worried about is that the
electronics will break and nobody will know what to do. MARCUS: Admiral. KIME: Hank, let
me also say that I think bridge team
management is something that’s extremely important. Dick Quagen mentioned that they
were concentrating on that. I think we can learn a lesson
from the aviation industry. There’s going to be
a seminar in Oslo, Norway on the human element in
avoiding ship accidents taking place at the end of June. I’m going to have the
privilege of being there. And we’re also bringing
the previous administrator of the FAA, also happened
to be Vice Chief of Naval Operations at one
time, and having a view of both the aircraft
and the sea aspects of this to try to look at those things. I think that’s necessary. We’re going a long
way [INAUDIBLE] with navigational age, with
differential global positioning systems that’ll tell you within
eight meters where you are. With ECDIS, which is Electronic
Chart Display and Information System, which at any scale
and with any color scheme put a chart on what
looks like a radar scope through differential
global positioning system tell you within eight
meters where your ship is. Also there will be a
collision avoidance system. All this will be, I think, a
tremendous help to our people. We need the proper
people on the bridge. We need to properly
trained people. And we also have to
keep in mind, things that cause accidents also,
even if you have those, are pressures sometimes
placed on ships. It was mentioned about the
Aegean Sea that ran aground. That ship ran aground
because it had been at anchor for a long time, and there
was tremendous pressure from the owner to
get that vessel in. And the vessel did go
in under circumstances which it shouldn’t move. So that, again, is part of
the equation, part of safety management from a corporation. No matter how good the
equipment, no matter how good– well the people are
trained, if, in fact, there are pressures to go in,
as there are many times under adverse conditions,
we’re going to have accidents. That comes under quality
management by a ship owner. MARCUS: Thank you. Lloyd. AUDIENCE: Well, I have
a couple of questions, one for [INAUDIBLE] Embiricos,
one for Lissa Martinez. Mr. Embiricos, you took a
pretty strong stand coming to [INAUDIBLE] not spill oil. Do you have any [INAUDIBLE]
from high impact groundings, double bottom tankers
where oil has been spilled? [INAUDIBLE] we do have
Captain [INAUDIBLE],, I guess he now has [INAUDIBLE]
paper of 1973 where he then wanted many of double bottom,
double hull groundings [INAUDIBLE] reached. And I wonder if you have
any [INAUDIBLE] which would negate those [INAUDIBLE]. We also have many banner
agencies [INAUDIBLE] in 1972. They included [INAUDIBLE]
Exxon and probably Texaco, where it was definitely
found that double hulls and double bottoms are
superior to single bottoms on any tanker. Can you [INAUDIBLE]? And I just wondered if
you had any [INAUDIBLE]?? EMBIRICOS: Yeah. Let me try and answer that one. Let’s talk about hard
data first of all. Sure, now, the Aegean Sea
is the most recent one. She was a double bottom ship. And what happened
is she ran aground. You have this huge double
bottom, this empty space. The inner hollow was pierced. You got hydrocarbons
in the empty space, and you got an explosion. And it’s only to be expected. I mean, data there is because
there have been accidents where basically if you
have a high impact– and this is the
important part of it– you are going to pierce
your inner shell. And that is inevitable. And you’ll pierce it
whether it’s by grounding or whether, as in the case
of the Maersk Navigator, it’s by collision. You have your structure
in this inner shell. So the structure is
in your double bottom or in your double hollow. When you have a high
impact, that structure is going to pierce
the inner skin. You’re going to get hydrocarbons
into this empty space. And an explosion then
is nearly inevitable. So really we’re going
for a design which does save pollution,
there’s no doubt about it, in the low-impact accidents,
but does not do so in the high-impact accidents. In addition to that,
we are creating ships that are built to be
higher up out of the water because you have all
this empty space, so you are carrying your oil cargo
much higher out of the water. When you breach your tank,
what’s going to happen is all this cargo is going
to come pouring out until you have a hydrostatic balance. So the double hull
is not a panacea. And we really have to accept
this because otherwise we’re kidding ourselves. AUDIENCE: I respectfully
disagree with you, sir. KIME: Yeah Hank, could
I also disagree with him because I think that’s the
reasoning that led us to OPA 90 and the Congress of
the United States passing a requirement
for double hulls. In the case of the
Aegean Sea, this was a vessel that was driven
at 12 to 15 knots into rocks. It was not a double hull tanker. It was a combination
carrier that just happened to have a double bottom. It’s like saying that I’m
going to take care of myself. I’m going to eat well,
I’m going to exercise, and I’m going to
live a long time, and then walk out into
the southeast expressway here without looking and
getting run over by a truck. If you– no matter how
you design a vessel, no design is going
to protect you at a high-speed
collision like that, which was pure human error. You cannot extrapolate that
anytime you have an incident like that, you’re going
to have an explosion. We’ve had LNG ships
running around the world. Never lost a life
in an LNG ship. One ran aground on a pinnacle
in the Mediterranean, ripped out almost
the entire bottom. There was no explosion. There was no loss of cargo. Most chemical carriers,
most liquefied gas carriers, have double bottoms,
something that is much more prone to leakage
than what you’re talking about, much more volatile than a crude
oil that you’re going to see. Certainly, double
hulls are not going to protect you in every case. But they are, in many
cases, going to protect you. To say that, in fact,
the Exxon Valdez would have been unstable,
she was unstable when she was on the pinnacle. That’s why we rushed the
Coast Guard and Exxon to salvage the vessel
as quickly as possible and take the 80%
of the cargo which didn’t leak to make sure
we didn’t have a spill much greater off of there because
she was structurally unsound. And she was unstable. She was only being
held up by Bligh Reef. If, in fact, the vessel
had had a double bottom, it would have come
to rest like that. And only about 40% of the oil
that leaked would have leaked. When you talk about
causing a double bottom and making a ship unstable
because that raises the center of gravity up
two meters or whatever, that’s assuming that the
naval architect is not ingenious enough– I would have not
passed around here if I had thought
that had been given by Harvey Evans, or someone
like that, a problem to design a ship. You’ve got to meet certain
stability requirements. You can make a ship stable
and still raise it up. There are some
constraints on it. They impact on the
ability of the vessel to go certain places. But that can certainly
be to be looked at. It will not– as I
said, my words were, “it’s not the answer
to a maiden’s prayer.” But the American Trader’s
spill off of Newport Beach, California, would
have been prevented by a simple double bottom. And I think that is something
we need to keep in mind. It’s not a panacea, but it
will help in many, many cases. And I think there’s no
basis to the argument that you’re creating
an unsafe bomb. And certainly the Aegean Sea is
no valid example in that case. AUDIENCE: I have to finish. MARCUS: Yeah, okay Lloyd. Question number two? AUDIENCE: So I do
want to add LNG ship, which I happen to be responsible
[INAUDIBLE] full cargo in LNG with 40% of your
bottom [INAUDIBLE]—- WOMAN: Is that a pressure hull? AUDIENCE: [INAUDIBLE]. Those are thick walls
and proceeded on her way. Reason Lissa– MARTINEZ: Yes? AUDIENCE: –that
Congress [INAUDIBLE] was caused a green
industry [INAUDIBLE] against these protective
sign, features [INAUDIBLE] since 1972 in an
unconscionable manner. And they scuttled
the whole thing. The Coast Guard apparently
is not strong enough to stand up against. Later in ’78– MARTINEZ: Mm-hmm
That one I remember. AUDIENCE: –even though
the President of the United States [INAUDIBLE] and
actively [INAUDIBLE],, it was scuttled again,
irresponsible action which could’ve
prevented much of this. And this is why
Congress– and I certainly helped them think
through on that matter and helped as much as I
could, [INAUDIBLE] I’m very proud of, to not risk my
money after 19 years of being trustworthy by having common
sense just thrown away at the jeopardy of all of
us who live on the planet. They got their dander out, and
they put through in that law. And I’m proud of everyone of
those 435 Congressmen and 100 in the Senate. MARTINEZ: Thank you. MARCUS: Thank you, Mike. Right here. AUDIENCE: Yeah,
I have a question for all of the panelists. As an MIT graduate
and a merchant officer who’s worked as a deck
officer on tankers, I have a question
just to throw out as a thought kind of question. We saw this morning about the
great presentation about what can be done with this
“can do” American spirit and our technology. And we have just
recently graduated a whole another class
of this class of ’93 for the Merchant Marine
Academy, so young deck officers. From my experience,
I’ve seen a great number of people leaving
this field because of the limited opportunity
for young Americans. And what I’m wondering is how
can we utilize this ability to [INAUDIBLE] of young
American officers, how do you see them fitting into
the solution to this problem given the limited opportunities
for Americans to serve on the ships that are
bringing this oil [INAUDIBLE] United States? MARCUS: Tough question. Who wants to start on that. KIME: Let me start
by saying my boss, the Secretary of
Transportation, Federico Peña, has been working extremely hard
on a maritime reform initiative to try to build up
the shipbuilding, and the shipping industry, and
the associated jobs that go with it, and the national
security aspects that also go with that. He was not successful
in his first effort, but he’s mounting up
for another charge. I think the way
to add to that is what is going to
have to be done, we have to provide some
help to this industry. Other nations– all
nations in one way or another, whether it’s through
direct subsidy, financing, or something of that
nature do provide that. I think that is
going to be necessary if we’re going to maintain
a viable merchant marine industry in this country. And I think for many reasons
that we need to do it. So we’re behind my boss pushing,
working on our part of it. And hopefully in
the next go at this, he will be successful
sometime later in the summer. QUAGEN: As a ship
owner in oil companies and a graduate of the
Merchant Marine Academy, yeah, it’s a concern to us. We’re working on a project to
build two to four American flag product tankers. The project, as it does
in many corporations, is grinding it’s way very
thoroughly, but relatively slowly through the mill. The problem is
cost, quite simply. The American merchant
marine officer has priced himself
out or herself out of the international
market, and to an extent that you really can’t
compete under the conditions. Mobil– I don’t know
this for a fact, but I have it on
very good authority, Mobil is experimenting
this year with hiring a number of graduates to sail
on their non-US flag fleets. Now, I don’t know under
what terms and conditions. For example, we have Italian
or British officers in addition to our American officers. And we are looking at this as
a result of Mobil’s effort. It would have to
basically be had the same conditions as
the European officers, but that’s not starvation wages. One of our concerns
is that as we stay in as an
American-controlled company with an international
fleet, to the extent the US fleet diminishes, that
resource of bringing people through the system I was a
product of, joining Texaco as a third mate, that
system is disappearing. And so there has to be some way
of continuing our accessibility into what is an
extremely valuable asset, and that’s the young
people coming out of the academies today. MARCUS: Lissa? MARTINEZ: Yeah, I’d
like to try to answer it from a very personal perspective
since I don’t hire anybody. And that’s probably the most
that you guys can speak from. I’m now about, let’s see, 18
years or so out of school. I miss not having any comp– I mean, I miss
having some company. There’s hardly anybody that I
feel a particular kinship to. My MAR grad friends
normally don’t have a whole lot of education
on environmental issues. And though the
curriculums have changed, and people understand
operationally what the directives are, the
looking ahead skills are really not being
cultivated in a way that I would love
to have it done. My non-MAR grad friends
who are coming out of naval architecture
curriculums, and marine engineering
curriculums, and elsewhere are
finding it very difficult to find commercial work to do. So that in the year
classes behind me, overwhelmingly, people
took jobs doing Navy work, and they’ve learned
how to design ships for the Navy, which is a fine
skill, but not the same skill as designing and operating
ships for commercial use or regulating ships that
are in commercial use. I don’t have any
particular solution. But I’m at the point now where
I’m more or less the same age that the guys who worked with
me when I was 22 and 23 were, and I learned a lot
from working with them. And I really feel
the lack of people to cultivate this
particular skill set. And so, I don’t have any
solution, just sympathy for you. MARCUS: Question over here. AUDIENCE: I’m an alumnus
from [INAUDIBLE],, and I’d be interested in hearing
about [INAUDIBLE] port design, [INAUDIBLE] configurations. Is this something
that [INAUDIBLE]?? And would [INAUDIBLE] design
[INAUDIBLE] for instance, in terms of [INAUDIBLE] space,
should we be going off-shore [INAUDIBLE]– MARTINEZ: Oh, that different. AUDIENCE: –[INAUDIBLE]? MARCUS: Good, I’d like
to hear from the panel. It’s the first
thing I’ll point out is that we are rather unique
as a major industrialized nation in the way you have
only one offshore terminal. And last count, there
certainly more than 110. I don’t know how
many there are now. But we do not have many
offshore terminals. And that certainly would
move those ships away from our shores. This is one approach. AUDIENCE: Can we have
the question repeated? MARCUS: Oh, I’m sorry. The question was really
the role of ports, the potential impact of port
design, and this whole problem. And one topic that’s
being discussed, or I don’t know if it’s
still being discussed or not, but Chelsea Creek in the Boston
area, where ships go up this– if they don’t hit the
bridge on the way, they go up the Chelsea Creek. And certainly people
have been talking about moving that entire
system offshore and doing it through hoses and pipes. And I don’t know to what
extent OPA addresses those kinds of things at all. KIME: OPA 90 does
have restrictions on navigation and safeguards to
be considered such as numbers of people on the bridge, tug
escorts, tanker exclusion zones, things of that nature
that are going to be addressed. But I think your
point of whether we should go with
offshore terminals or not is a very good one. We do have one offshore
terminal loop down in Louisiana. There has been consideration for
a second offshore terminal off of Texas. The problem is right
now that it is not economically viable to do that. And I think that’s the thing. Obviously, if the
deep draft tankers could be kept off shore,
I think loop last year– I just signed the
report to the Congress that we have to send
up once a year– I think they spelled
147 gallons of oil. And most of that
probably vaporized before it hit the water. So obviously, that
is a way to go. But the economics of it
just don’t seem to be there. Also, you have to have
an infrastructure. You have to see where the
pipelines are, the distribution systems, et cetera. There are some offshore
terminals off of California, but they probably contribute
to as many accidents as they prevent, although
some new initiatives have been taken
with the Coast Guard and the State of California. Certainly that is an
area we should look at more for future terminals. And certainly,
environmentally, that is a tremendous way to
reduce the types and dangers that we’ve seen recently. MARCUS: Lissa. MARTINEZ: Yes. MARCUS: I’m sorry. MARTINEZ: Well, one
comment on ports, ports are assumed to provide
services to ships under several of the legal regimes
in facilities called port reception facilities. I think it’s fair
to say that that’s been one of the great
catch-22s of the legal regime. And so it would be interesting
to get your perspective as a planner on a port
plan that dealt with that and was able to deal with the
costs, and the constructions, and the local planning, and
everything else because we keep returning to this now. And now with the Flag State
Implementation Committee and IMO, I’m really
looking forward to seeing what
people will finally confront on the notion of
port reception facilities, and how do you provide them, and
what are the minimum standards of performance? And so there is
an assumption that ports as a participant in both
operational and accidental pollution prevention,
but it’s always been more or less attributed
without being articulated in a way that you can find
the professional skill set to really tell somebody, if
you’re designing a new port, this is the way to go. QUAGEN: I was just going to
say, you brought back a memory, Hank. I was– in 1964,
I was second mate on a tanker that hit
the Chelsea Bridge. MARCUS: It’s still
there, but it’s been beaten around a while. KIME: You didn’t kill it. QUAGEN: No, I didn’t kill it. MARCUS: Alex. AUDIENCE: Yes, I
guess my question’s directed more to my friend
Bill Kime than anybody else in the panel. I hope you don’t mind. I had the privilege of being
a project leader on a program some years ago to develop an
R&D program for the US Coast Guard on oil pollution R&D– what to do, how much it will
cost, how long it might take, so on. And so I’m very much interested
in this whole issue summarily. [INAUDIBLE] the Torrey
Canyon, the [INAUDIBLE],, and then the Valdez. And the Valdez, to
me, all I read– and I don’t have the privileged
informatio that [INAUDIBLE] Kime must have– was a total chaotic
state confusion between state authorities
and federal authorities. And no one really
dared to do one thing without having total approval. What’s been done to change that? I mean, aren’t we going to
have the same kind of problems the next time we have a
situation off of Valdez? MARCUS: Good question. KIME: Yeah, that’s a
good question, Alex. Let me say that all of the oil
that spilled from the Exxon Valdez spilled in 11 hours. And Exxon made the statement– and the scientific support
coordinator who, from NOAA, who provided scientific
advice to the federal on-scene coordinator agreed– that had Exxon had
right next to Bligh Reef at the instant the vessel
grounded, the maximum amount of equipment that it had at
any stage of the cleanup, it would’ve made
about a 10% or 20% difference in the amount
of oil that came out. The issue is to keep the oil
in the ship in the first place. Now, the question
of the organizations surrounding the Exxon Valdez if
any of you saw the HBO movie, reverse that about 180 degrees. And although my good
friend, Frank Iarossi, came out very well in
that, I was glad to see, it didn’t talk
about the reality. What you had there was
a port that had a spill. Alyeska and Exxon
had representatives. The Coast Guard had
a commander on scene. And the State of Alaska
had a gentleman NC, the ADEC representative. And then this happened. And what happened was that
everybody descended on scene– the Secretary of
Transportation, the Commandant of the Coast Guard,
the district commander, the president of Exxon itself,
the president of Exxon tankers, the Governor of Alaska, and
every news anchor person that could buy a ticket
all descending on scene. When I was up there, one
of the biggest jobs I had was taking care of
visiting firemen. We had a protocol office. And we took care of these
people and still let the cleanup go on. These people have
a right to know. They have a reason to know. But what we did not have
in place at that time– we had a great organization
for a typical spill, of which there’s 8,000
a year in our waters, but not a spill of national
significance, of [INAUDIBLE].. And when rewriting the
national contingency plan, we have put together an
organization that we are going to utilize– at least
the Coast Guard is, the EPA is still looking at it– but a very specific organization
that will take the lessons learned from the Exxon Valdez
to keep this kind of confusion or perceived confusion down
so that the people that need to know will know– the elected
officials, the media– and at the same
time, the cleanup will go on at a
well-organized way, resources will be brought
to bear very, very quickly. So hopefully we
have an organization that will solve that problem. I think it’s a very
good organization we’ve put together. I use– I was a federal on-scene
coordinator when the American Trader went aground. And having been up in Alaska, we
utilized those lessons learned. We’d didn’t have
them written down. But Jim Card, whose name was
mentioned, and I were there. And we were able to skim
about 35% of the oil from that incident. That’s the most anyone
has ever skimmed. And we kept the media going,
and kept this off the front page after about two days. So I think we’ve
learned some lessons. But that is a very key thing. And that, again, is
something that OPA 90 has mandated, not just for
a federal/national plan, but for local plans,
and for the plans, as Dick talked about,
for ships and terminals. MARCUS: Do you have a follow-up
for our last question? AUDIENCE: Follow-up,
and that is the Braer off the Shetland Islands. What we got here in
this country is really TV news, CNN type of
thing, where dispersants were used almost within hours,
I think, of the grounding, and a lot of complaints about
the farmers getting detergent on their fields, and therefore
not having anything to grow. What have we as a community,
technical community learned from that accident that is
useful for future [INAUDIBLE]?? KIME: Well, certainly
Lord Caithness and the British
government are still doing their investigation
of that incident. Concerning dispersants,
I don’t think we’ve learned anything
since the Torrey Canyon about dispersants. We have this mindset that I
discussed and in my comments, there are places to use
dispersants and places not to use dispersants. There’s the proper
quantity to use. There needs to be
preplanning approval as EPA does of the
types of dispersants. And then the plans
that I talked about have to say at certain
times of the year, under certain conditions,
you go through a matrix. Yes you may, yes
you may not, or you may under certain other
circumstances use a dispersant. That’s what we need to know. The farmers, I think, as
a result of the Braer, were impacted by fumes from the
oil that was coming out there. We’re interested to see
what really happened there. Of course, they had a
tremendous high-energy sea that had a great effect. We didn’t have that in Alaska. We had a lot of
low-energy beaches where natural dispersion
didn’t take place. How effective dispersants
were, I don’t know. We’re going to have
to wait to see what the British government says. MARCUS: Any final
comments from the panel. Let me thank the
audience for there– oh, Philip, we’ll give
you the last question if it’s a short one. AUDIENCE: So it’s [INAUDIBLE]. KIME: Why is everyone
picking on me? I got blamed here from my good
friend for low-freight rates in the tanker industry, the
Johnstown flood, and the fact that Michael Jackson can’t
hit his jump shot, probably Larry Bird’s back. Go ahead, my friend. MARTINEZ: Michael Jordan. Michael Jackson [INAUDIBLE]. AUDIENCE: —-[INAUDIBLE]
First of all, she was not– she didn’t want to get into
the court because the refinery [INAUDIBLE] the court, because
they had an empty tank. The ship wasn’t [INAUDIBLE]. They had no interest
in geting [INAUDIBLE].. It was all pilot. The pilot was more important. So I think it’s a bit
unfair to blame the ships. But anway, let me come
to my question, which has nothing to do with that. [INAUDIBLE] as you say,
the important thing is [INAUDIBLE] the ship. So you have the ship is on. We’re not going to go into
that, that’s too deep. But that seems like an
emergency [INAUDIBLE],, and that’s why we’re
doing the research. And there is also
something which I think is very important. I mean, [INAUDIBLE] because
[INAUDIBLE] are very [INAUDIBLE] surface tension. If we increase the surface
tension of the oil, this will spread much less. Now, I was speaking
today with police of MIT about a specific problem. And apparently, they are
looking into something. They have found something
which apparently is a chemical that will be
carried to the tank itself. And in case of an accident,
you will break the [INAUDIBLE],, or wherever it is. And this will somehow
[INAUDIBLE] the problem. Now, I think that is the
right kind of research. Now, you can all the [INAUDIBLE]
and all the ice cream stands which I refer to [INAUDIBLE]
and to skimmers, I mean, it would never work. And you yourself as an expert
witness, and you told us, I mean, the most we
can handle is 20%. So I think we have to develop
research and other measures. And I would beg you, sir,
to put money to Congress– to us in Congress
on [INAUDIBLE].. MARCUS: Well, Admiral
you can get the final– you’ll have the final comment. KIME: That is something that
should absolutely be looked at. OPA 90 does require
a coordinated R&D regime in this country. The Coast Guard
heads that up along with all the federal agencies. We are taking all the
ideas that we can find, things such of that nature
to solidify the cargo, to change its physical
characteristics. Those are the things
that are being looked at. We’re also, through the
International Maritime Organization, [? ORE ?]
sponsored an R&D seminar in this country to
coordinate internationally. There’s precious few dollars
available, unfortunately, for R&D in this area. We’ve got to make sure
we don’t duplicate. Finally Hank, let me, since
I do have the last word, someone said we don’t
have a publication on environmental
considerations in this country that we need coming from ships. As president of the Society
of Naval Architects, that is an initiative
I am undertaking. So if there are any
of you out there who would like to be the
editor of this publication or a contributor, hopefully
at our national meeting not this September, but
October of the following year in New Orleans, we hope to
dedicate that technical session to these issues. It’s multifaceted. We’ve heard all parts of it. But we do think
that as an industry, we need to pay the same
attention to this as we do to structural design,
machinery design, and things of resistance, and hull
form that the society has traditionally paid attention to. MARCUS: Thank you for
ending on a positive note. I want to thank the
audience for your attention and participation. And our panelists
have been outstanding. Thank you very much. [APPLAUSE] Meeting adjourned.

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