Stolt Tankers is the shipping arm of Stolt-Nielsen Limited (SNL), an Oslo-listed world-leading provider of integrated transportation and storage solutions for speciality bulk chemicals and other liquid products. The operation of sophisticated deep-sea, regional, coastal and inland parcel tankers by Stolt Tankers is one of the company’s three largest subsidiaries, along with Stolthaven Terminals and Stolt Tank Containers (STC). Stolt Sea Farm (SSF), Stolt-Nielsen Gas (SNG), and SNL’s newest venture Stolt Bitumen Services (SBS) comprise the rest of the portfolio.
There is some crossover between these divisions, most notably the integration of Stolt Tankers and Stolthaven Terminals. By bringing together the latter’s worldwide network of high efficiency bulk-liquid terminals, and Stolt Tankers’ fleet of over 150 ships and barges, the company functions as an integral and vital part of its customers’ global supply chains. Within this client base, Stolt Tankers counts many of the world’s chemical and petrochemical majors as regular Tankersand long-term customers, including Dow Chemical, Shell, Exxon, Chevron, and BP.
At present around 70 per cent of Stolt Tankers’ work is derived through major contracts, which ensure a steady flow of work. “If you look at where the industry is it has been a very tough four years,” begins Hans Feringa, president of Stolt Tankers. “In 2008 we saw that a downturn was coming and prepared for this by going long on contracts and short on ships. Although we didn’t anticipate five years of slow activity, we saw enough of a change to take steps to ensure we had sufficient contract work. Our expectation now is that, whilst it is getting better, it will be another year or so before the market fully recovers.”
Another contributing factor to the current market challenges is the sheer number of vessels ordered during the peak years, leaving many sectors facing huge over-capacity. In reflection of this, over the last three years Stolt Tankers has purchased ten ocean-going vessels on the second-hand market, bolstering its fleet with these well-priced sophisticated assets, as opposed to new builds.
That said the company does currently have five 38,000 dwt stainless steel parcel tankers on order from Hudong-Zhonghua Shipyard in China for delivery from December 2015. The next-generation design of these vessels is intended to deliver substantial improvements in fuel efficiency, as well as cargo handling flexibility. “Very specialist kinds of ships are not readily available through the second-hand market,” explains Hans. “So we have ordered the five vessels from China, and over the next five years we will probably need to replace another five. However, as we work in a cyclical business, and with almost no orders placed since 2008 and the ships ordered prior to then having already been delivered, there’s been a real tightening of supply and demand, so we will be looking for a recovery in the market before committing to further orders.”
In terms of the fleet today, Stolt Tankers is equipped with sophisticated handling equipment, such as heating and cooling systems, specialised cleaning equipment, and nitrogen generators. Alongside the experience of its officers and crew, this enables the company to safely handle virtually any liquid cargo, including speciality chemicals, petrochemicals, clean petroleum products, acids, vegetable oils, commodity chemicals, and lubricating oils.
Fundamentally, Stolt Tankers’ ambition is to be the preferred tanker operator for its core customers. Toward this end, the company is working together with its customers on improving efficiency and safety. “We believe in balanced triangular trade, so we undertake contracts and then typically work with the client to try and make that supply chain as efficient as possible. On our part, as a specialist in cleaning vessels, and managing a portfolio of contracts, we try to never have an empty ship, which optimises voyages. We’ve also put a lot of effort into developing software and systems to ensure we have the right data to help us achieve this,” notes Hans.
Efficiency not only comes from the operator though, but also by selecting the most efficient terminals in order to minimise congestion and delays. Given that a deep-sea parcel tanker spends roughly a third of its voyage in port loading and unloading, reducing this time can have a significant impact on the rest of the chain. “We see that in many parts of the world investments in terminal infrastructure have been lacking in production units. There is more and more volume coming in, and relatively speaking, less terminals to handle this, which is leading to congestion,” explains Hans.
“It is increasingly important that big expensive ships such as chemical tankers are handled at the most efficient terminals, as otherwise they are waiting. In a bad market we may pay for it, and in a good one the customer often pays for such delays. In either case it is inefficient. Together with our customers we want to provide the most efficient supply chain we can, and a good starting point for this is the choice of terminal,” he concludes.
Sophisticated tanker fleet
Focusing on efficiency
New vessels ordered