Reducing the Oil Tanker Risk

Comprehensive training and quality assurance systems are in place for the oil tanker industry. Here's a glimpse at what they are.

By GRAHAM BUCK, who covers European risk management issues

The tanker industry is heavily controlled by the oil majors, and owners must obtain their approval as the charter party, said Simon Stonehouse, chief hull underwriter for Brit Insurance. If the owner fails to obtain this approval, then effectively he cannot operate.

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The industry's quality assurance system, Tanker Management Self Assessment (TMSA), uses the International Safety Management code (ISM) as its base and goes further by monitoring continuous improvement against key performance indicators (KPIs).

The TMSA is the means of passing the Ship Inspection Report (SIRE). The SIRE Program is a unique tanker risk assessment tool of value to charterers, ship operators, terminal operators and government bodies concerned with ship safety.

The SIRE system is a very large database of up-to-date information about tankers and barges. Essentially, SIRE has focused tanker industry awareness on the importance of meeting satisfactory tanker quality and ship safety standards. Since its introduction, the SIRE Program has gained industrywide acceptance and participation by both Oil Companies International Marine Forum (OCIMF) members, program recipients and by ship operators.

Alongside the TMSA and SIRE sits the training initiative called Tanker Officer Training Standards (TOTS), which enhances existing training initiatives such as the tanker endorsements and officer matrix requirements established by the oil majors. This is an initiative launched by the tanker trade association Intertanko with the co-operation of OCIMF and the majors.

"I suspect the costs of running a single-hull tanker compared to double hull are not much different, and in some case could be more as the oil majors will require a very high standard in order to charter them," said Stonehouse.

"If the vessel is single hull, it still has to go through these processes. An underwriter should ensure that the charterers include the oil majors and verify the status of the TMSA and SIRE," he added.

September 1, 2010

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