Oil storage tankers gather off Malta
A number of tankers have gathered around Malta storing oil until prices recover.
Shallow water, mild weather and its sheltered location have made Malta a haven for tankers hired by oil and gas firms to exploit the market structure caused by the biggest fall in global oil demand in about 20 years, amid economic slowdown.
About six crude oil tankers, 20 oil product tankers and four liquefied natural gas(LNG) tankers are floating off Malta, the highest density of anchored tankers outside ports in the world, according to AISLive ship tracking data on Reuters.
That means at least 20 million barrels of oil, or about a quarter of the world's daily demand, are on the seas around Malta, while the data showed few in May.
"The ships have to float somewhere where they can get supplies etc, and they have to shelter somewhere," said one oil trader, whose company has stored some oil in tankers.
"The conditions sound good to me for anchoring. It has nothing to do with Malta."
Global oversupply has pulled down prompt oil prices to deep discounts to longer-dated contracts this year, or a market structure called contango, causing oil traders to store oil on land and at sea to make profit by selling later. The trading play has piled up more than 110 million barrels of oil at sea across the globe, with most of them floating in Europe.
Daily world oil consumption is about 83 million barrels. More ships, including crude tankers, are likely to arrive to seek shelter off Malta for a relatively long period of time until winter heating demand picks up and draws some oil from the tankers, traders said.
Earlier this mornth JPMorgan Chase & Co said it had hired hired a crude tanker vessel to store gas oil off Malta's coast..
One shipping source said the vessel, Front Queen, was a new very large crude carrier (VLCC) which had never had a cargo on board meaning that its tanks were clean and able to carry refined products.
The tanker can carry up to 2 million barrels of oil, the source said.
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A. J. Ellul
Jun 22nd 2009, 14:57
Those tankers anchored off Malta's shores are an environmental disaster waiting to happen. Recall the disaster 20 years ago of the Exxon Valdez in Prince William Sound, Alaska. Those who wish to refresh their memories might consider following this link - http://www.eoearth.org/article/Exxon_Valdez_oil_spill.
Should anything go wrong with these tankers, Malta can expect incalculable damage to its environment with beaches unusable for decades or longer, mass destruction of marine life around our islands, and the virtual destruction of the tourism industry in Malta – a mainstay of our economy. These tankers parked in Malta’s territorial waters are nothing more than environmental terrorism by corporations who, by their own admission, are acting out of pure greed in using tankers as floating storage facilities while they wait for higher prices for oil and gas.
Malta cannot afford to allow these greedy corporations to threaten the environmental and economic well-being of our country. All political parties, especially the ones in our Parliament, must unite and promptly demand that these tankers leave Malta’s territorial waters immediately.
francesca vincenti
Jun 22nd 2009, 09:32
Great, this is all we need now.... refugees of the tanker kind...
jcmicallef
Jun 21st 2009, 16:19
Get them out of here!!!
NIMBY!!!
Not In My Back Yard - typical and classic reaction - but certainly valid in Malta's case.
A.SCIBERRAS
Jun 21st 2009, 10:07
"shallow water" Well is it not good for a wind farm then!
R.Gatt
Jun 21st 2009, 08:30
Totally agree with Mr Bezzina.
Besides his valid point, we must not forget the possibility of tankers accidentaly severing one of the undersea cables which connect us to the rest of the world.
If not mistaken, Malta's lifeline now has redundancy, but I'm sure that none of the local providers would want any such incident happening to their, or their competitor's cabling.
albert leone ganado
Jun 21st 2009, 07:20
I trust that thru the MMI we are getting some benefit for the risk they pose and the monitoring which has to take place to keep some control of our sea lanes.
Clear charges must be established for those tankers using our waters as part of their business model
Danika Vella
Jun 21st 2009, 00:08
Are they paying for berthing in Maltese territorial waters at least (I guess they are in our territory right? Not sure about this though!) ... I hope so!
Emmanuel Zammit
Jun 20th 2009, 22:19
The EU does not allow hoarding of sugar, and Malta was fined for doing so. So why does it allow hoarding of oil in its territorial waters? Does it have two weights and two measures?
How come "it has nothing to do with Malta"? What happens if there's an accident and an oil spill? Will Malta be left to suffer the consequences without holding anyone accountable?
Alfred Farrugia
Jun 20th 2009, 22:17
On Friday, June 19, petrol (called ‘gas’ in the U.S) was 2.99 dollars a gallon in the Washington, DC, metropolitan area – the highest this year! So motorists and consumers are not really gaining from any surplus of energy, as prices have been going up little by little over the past weeks.
http://www.msnbc.msn.com/id/12400801/
http://economictimes.indiatimes.com/Editorial/Rising-oil-prices-a-blessing-or-a-curse/articleshow/4669084.cms
http://www.oil-price.net/
I Vella
Jun 20th 2009, 21:57
how much is malta getting out of this?
Jimmy Magro
Jun 20th 2009, 21:34
Instead of telling us the prices of energy will have to go up again - as if our government likes to beat its citizens - what are our bigheads doing to take advantage of market fluctuations in the oil market so that we can have our electricity rates cut down by 185%.
For the sake of transparency - is there any information what oil has been contracted for for the next three years?
Anthony Farrugia
Jun 20th 2009, 20:53
Albert Bezzina @:It all depends whether they are anchored in Maltese national waters or international waters where Malta has no jurisdiction.
Eugenio Taliana
Jun 20th 2009, 20:48
I think we shouldn't be so happy about this - just one accident and imagine the repercussions it might have on our shores.
Victor Laiviera
Jun 20th 2009, 20:23
Mr Bezzina, as long as they stay outside territorial waters (12 miles, unless I am mistaken) there is nothing we can do about it.
Sybil Mchugh
Jun 20th 2009, 20:06
We have been to malta on holiday for the last 20 years and have noticed that the sea traffic around malta has been getting busier year on year. As the last comment said this is an accident waiting to happen and i sincerely hope that it doesnt.
M Formosa
Jun 20th 2009, 19:56
What about all the waste which is discharged in the sea. These tankers are not the Queen Mary 2, I don't think that they are going to treat all their waste before dumping it in the sea and eventually washing up on our shores. This is shocking, everyday I read something new which sends shivers up my spine.
wally vella-zarb
Jun 20th 2009, 19:39
They are in international waters, not in Maltese territorial waters. As long as they stay at least 12 NM away from the nearest land they can stay for as long as they like, whether we like it or not.
J Farrugia
Jun 20th 2009, 19:09
if these tankers have nothing to do with Malta or else they do not supply our markets,then the best thing to do is to send them packing away from our islands. God forbid if ever an accident were to happen on any one of these timebombs. I'm not pessimistic, but I think that they should be anchored as far away from the med as possible. an accident in open waters will see us cut off from the rest of the med countries for quite some years. if ever we can rise again. all this crude in the med is madness.
Stephen Forster
Jun 20th 2009, 19:05
Sheltered anchorage is one thing, but surely this amount is a high potential risk???
Noel Cutajar
Jun 20th 2009, 18:38
Imagine...the Alaskan oil disaster...if it would happen, we will be remembered as the Black Island...
Anthony Camilleri
Jun 20th 2009, 18:25
Don't worry Albert, they're anchored just off M'Scala & as you know the South has already been written off by now for the tourist industry; recycling plant, power station with its new addition (no alternative site?), fishfarms, freeport .................
Galea. L
Jun 20th 2009, 18:21
Anchoring off Malta with the attendant danger of a disaster which would destroy our fishing grounds, our beaches and tourism without paying a single cent.
An artificial Island should be built on Hurds Bank so that they will not be able to anchor and if they want to they should come into port and pay port dues. The same Island which can be built by using our construction waste can be used to build a power station there and remove pollution from built-up areas, killing several birds (no birdlife comments) with one stone.
L. Mule'Stagno
Jun 20th 2009, 18:10
Certainly share your concern - though I doubt they need anyone's permission to anchor if they are in international waters.
A. Mifsud
Jun 20th 2009, 18:05
With all this surplus stock of crude combined with sluggish demand - I won't be surprised to see oil prices slump once again. Although crude prices have gone up substantially over the past weeks it seems that there is still surplus supply even though oil producers have reduced quotas. Storing crude afloat tankers is only a short term solution and therefore a reduction il world crude market prices is imminent.
And yes like Mr. Bezzina has anticipated - I too beleive that the numerous vessels in Maltese territorial waters do pose a potential hazard to the environment. Most probably the local ship chandling business may not be of the very same opinion.
J. Borg
Jun 20th 2009, 17:58
Any real contingency plans to deal with an oil spillage?
I Alamango
Jun 20th 2009, 17:35
this is a real danger for our seas! If an accident shall occur our natural habitat will be busted! So will our tourism and economy.
But then again we have to make money from some sources! Hope the money we are receiving from these tankers to stay in our waters is worth the risk we are incurring!!
Keith Aquilina
Jun 20th 2009, 17:31
What about if there is an oil spill?
Albert Bezzina
Jun 20th 2009, 17:22
One accident and we can pack up the tourist industry and our lives for the next 15 years. I am sure this is lucrative for our Island but who took the responsibility to allow such a potential environmental disaster to be anchored off our shores?