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Mar 1, 2016
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Lockton Edge

US and Nigerian led international operation frees hostages off Sao Tome

The European Union’s Emissions Trading System (EU ETS) was extended to cover emissions from shipping as of 1st January 2024.

The EU ETS is limited by a 'cap' on the number of emission allowances. Within the cap, companies receive or buy emission allowances, which they can trade as needed. The cap decreases every year, ensuring that total emissions fall.

Each allowance gives the holder the right to emit:

  • One tonne of carbon dioxide (CO2), or;
  • The equivalent amount of other powerful greenhouse gases, nitrous oxide (N2O) and perfluorocarbons (PFCs).
  • The price of one ton of CO2 allowance under the EU ETS has fluctuated between EUR 60 and almost EUR 100 in the past two years. The total cost of emissions will vary based on the cost of the allowance at the time of purchase, the vessel’s emissions profile and the total volume of voyages performed within the EU ETS area. The below is for illustration purposes:
  • ~A 30.000 GT passenger ship has total emissions of 20.000 tonnes in a reporting year, of which 9.000 are within the EU, 7.000 at berth within the EU and 4.000 are between the EU and an outside port. The average price of the allowance is EUR 75 per tonne. The total cost would be as follows:
  • ~~9.000 * EUR 75 = EUR 675.000
  • ~~7.000 * EUR 75 = EUR 525.000
  • ~~4.000 * EUR 75 * 50% = EUR 150.000
  • ~~Total = EUR 1.350.000 (of which 40% is payable in 2024)
  • For 2024, a 60% rebate is admitted to the vessels involved. However, this is reduced to 30% in 2025, before payment is due for 100% with effect from 2026.
  • Emissions reporting is done for each individual ship, where the ship submits their data to a verifier (such as a class society) which in turns allows the shipowner to issue a verified company emissions report. This report is then submitted to the administering authority, and it is this data that informs what emission allowances need to be surrendered to the authority.
  • The sanctions for non- compliance are severe, and in the case of a ship that has failed to comply with the monitoring and reporting obligations for two or more consecutive reporting periods, and where other enforcement measures have failed to ensure compliance, the competent authority of an EEA port of entry may issue an expulsion order. Where such a ship flies the flag of an EEA country and enters or is found in one of its ports, the country concerned will, after giving the opportunity to the company concerned to submit its observations, detain the ship until the company fulfils its monitoring and reporting obligations.
  • Per the EU’s Implementing Regulation, it is the Shipowner who remains ultimately responsible for complying with the EU ETS system.

There are a number of great resources on the regulatory and practical aspects of the system – none better than the EU’s own:

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02003L0087-20230605

https://climate.ec.europa.eu/eu-action/transport/reducing-emissions-shipping-sector_en

https://climate.ec.europa.eu/eu-action/eu-emissions-trading-system-eu-ets/what-eu-ets_en

As reported on this page yesterday Nigerian authorities have reported the arrest of six suspected pirates and recovered the product tanker MAXIMUS in a firefight that killed an alleged pirate. Ten Indian crewmembers of the Maximus were rescued by Nigerian forces. The operation now turns out to be an international effort supported by the USNS Spearhead and involving a cooperation between France, United States, Ghana, Togo, Sao Tome and Principe, and carried out by the Nigerian Navy. The US began training with African nations in the Gulf of Guinea in 2009.

The Guardian reports:

“It was supposed to be a US-led naval training manoeuvre off the coast of west Africa when real-life drama intervened, with pirates taking over an oil tanker and turning the exercise into a rescue mission. Navies from the United States, Ghana, Togo and Nigeria tracked the hijacked tanker through waters off five countries before Nigerian naval forces stormed aboard on 20 February amid a shootout that killed one of the pirates. It was the first big success in international maritime cooperation in the pirate-ridden Gulf of Guinea, the commodore in charge of US operations in Africa and Europe told the Associated Press. Capt Heidi Agle, the commodore, had been directing a training exercise against piracy with maritime agencies of Ghana when the hijacking provided a real-life lesson, she said in a telephone interview on Friday from her base in Italy. First word came from the French embassy, which sent information to Agle’s USNS SPEARHEAD via Ghanaian officials and US diplomats of a possible pirate ship loitering off Abidjan, Ivory Coast. There, pirates seized the Dubai-owned MT Maximus, on lease to a South Korean company and carrying 4,700 tons of diesel fuel, on 11 February. The SPEARHEAD tracked down the hijacked Maximus, identified it and then monitored its progress for two days as it sailed from Ivorian waters into Ghanaian territory. Then Agle handed over to Ghana’s navy, which continued to shadow the ship until it entered the waters of Togo, when that country’s navy took over. As the pirates steamed across the gulf toward the tiny island nation of São Tomé and Principe, officials there contacted the Nigerian government for help. The tanker had sailed nearly 800 miles (1,280km) before the Nigerians made the assault. “Never has a west African navy carried out an opposed boarding before,” he said. Agle called it “a coordinated effort and the biggest piece in progress in the region” since the US began training with African nations in the Gulf of Guinea in 2009.The rescue was directed by Rear Admiral Henry Babalola of Nigeria, who told the AP that it was made possible by a maritime agreement allowing Nigeria to patrol São Tomé’s waters. “When we challenged them [the pirates], they said that they were in international waters” with the law of the sea on their side. But the agreement allowed the Nigerians to storm the ship after eight hours of attempted negotiations. “International cooperation is the new mantra for maritime security,” Babalola said. “We cannot go it alone. ”Six pirates were captured and 18 crew members freed. Several pirates escaped with two crew members who remain hostages, Steffen said. Babalola stressed the economic impact of piracy, pushing up the price of maritime insurance with costs ultimately passed on to consumers. One-fifth of all maritime crime in the world is committed in the Gulf of Guinea, but that is only the tip of the iceberg since an estimated two-thirds of piracy acts there are never reported, according to Ocean Beyond Piracy, a private, Colorado-based organization. The Gulf of Guinea is primed for economic growth, a major route for oil supplies shipped around the world with a mild climate that is ideal for commerce, docking and fishing.”

SOURCE: THE GUARDIAN.

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