Ports

Piracy in Somalia

Although by many estimates piracy around Somalia is rapidly declining, it is still a major concern for vessels traveling through the Indian Ocean and the Gulf of Aden. In addition, with more than 10% of the world’s seaborne oil being transported through the gulf - en route to the Suez Canal or to regional refineries - the threat of piracy remains particularly worrisome to the oil shipping business.

Piracy attacks grew dramatically from 2008 to 2011, going from 24 attacks in 2008 to a staggering 176 attacks in 2011. Out of these 176 attacks, 25 were successful, which meant that the pirates succeeded in taking control of the ship and the crew was taken hostage. However, the number of attacks has since rapidly declined, with just 6 attacks in 2013, none of which were successful. Reasons for this decline include an increase in the presence of international naval forces in the region, adoption of “best management practices” by the ships traveling these waters (such as taking evasive action and hardening the ship’s hulls) and hiring private security guards on board the ships.

Links:

The Venezuela-Cuba Oil Deal or Venezuela’s Oil Diplomacy

Starting in the year 2000, Venezuela and Cuba have had an agreement to exchange Venezuelan oil for Cuban medical and technical assistance. As it stands today, Venezuela sends Cuba more than 90,000 barrels of oil a day in exchange for more than 40,000 medical and sports training Cuban personnel. Although these oil shipments only account for 3.5% of Venezuela’s daily oil production, it represents over 20% of Cuba’s GDP and is comparable to what the USSR was giving the island during the 1980s. Cuba only uses half of this aid for domestic consumption and re-exports the rest.

However, with the passing of Hugo Chavez the future of this aid seems to be less secure. Though the new Venezuelan president, Nicolas Maduro, has pledged to continue helping Cuba and has signed accords for more than 50 projects with the island, analysts worry that the internal economic and social problems facing Venezuela will have a negative effect on the aid that Cuba currently receives. Furthermore, Cuba’s attempts to become a bigger oil producer have not gone well, as evidenced by multiple international oil companies withdrawing from the island after exploration and extraction failures.

Links:

What Chavez’s Death Means:

Venezuela Oil Diplomacy: From Caracas To Cuba | NPR
Venezuela's Maduro pledges continued alliance with Cuba | Reuters
Cuba Ill-Prepared for Venezuelan Shock | ASCE
Now for the reckoning | NPR

Cuba’s Own Oil Reserves:

Cuba’s Prospects for an Oil-Fueled Economic Jolt Falter With Departure of Rig | NYT

Other:

Cuban doctors prescribe hope in Venezuela | AlJazeera

The Northern Sea Route and the Northwest Passage

One of the most important effects climate change has had on the shipping industry is the increased viability of the two main Arctic sea routes. The “Northern Sea Route”, also called the “Northeast Passage”, is the most viable of the two routes and could save up to 2 weeks of travel between China and Western Europe; a journey that currently takes 45 to 50 days could take 35 days. Instead of going through the Suez Canal or around Africa, ships on this route will travel north from China, cross the Bering Strait and sail westward along the northern coast of Russia, coming down into western Europe along the coast of Norway. However, the passage is still only viable during the summer and ships traveling its waters often must follow an icebreaker vessel to protect them from any icebergs.

Nevertheless, what’s seen as a huge opportunity for the oil shipping industry is also perceived as an enormous environmental threat by Greenpeace and other NGOs. In addition to being a region that hosts large populations of fish and other animal life that could be threatened by an increase in fishing activity, critics also fear a massive oil spill, which, without the adequate infrastructure to prevent it or contain it, could be devastating for the ecology of the Arctic.

Links:

First Voyages:

Russia Preparing Patrols of Arctic Shipping Lanes | NYT
Northwest Passage crossed by first cargo ship, the Nordic Orion, heralding new era of Arctic commercial activity | National Post
South Koreans take first Northern Sea Route cargo delivery from Russia | Alaska Dispatch
Japan to Get Second LNG Spot Cargo From Norway via Arctic | Bloomberg
Warming Revives Dream of Sea Route in Russian Arctic | NYT
China's voyage of discovery to cross the less frozen north | The Guardian

Commercial Advantage:

Arctic Transit: Northern Sea Route | Gallois
Ice levels, rule changes to boost Arctic northern sea route | Reuters
Icebergs, insurance hamper Arctic shipping route opened by climate change | Times Live
Environment: Frozen frontiers | FT

Environmental Issues:

Charctic Interactive Sea Ice Graph | NSIDC
Arctic Sea Ice News | NSIDC
Greenpeace icebreaker defies Russia ban on Northern Sea Route | FT
Latest Updates: Arctic 30 Out of Jail, Still Facing Serious Charges in Russia | Green Peace
Ten reasons why Shell are complicit in the detention of the Arctic 30 | Green Peace

Other:

The Northeast Passage Opens Up | NYT

America’s Shale Gas and Oil

Although some people argue that “fracking” will not revolutionize the energy business and that its positive effects have already plateaued, the US energy sector has definitely been through a major change in the last decade thanks to this new technology. For example, gas output in the US has risen by one third since 2008, jobs in the energy sector have doubled since 2005 and oil production has gone from 15 million barrels a day in 2006 to more than 22 million, almost surpassing Russia, the world’s largest producer. Furthermore, as gas and oil production have continued to grow and gas prices have continued to drop, the US has converted some of its energy terminals from imports to exports and is again attracting petrochemical and metal industries to its ports.

However, even though some aspects of fracking may have benefited the environment - greenhouse emissions, for example, have fallen by 10% as coal plants get replaced by gas plants - this new technology remains highly controversial, with environmental groups all over the globe arguing for tighter controls or even a total ban on the technology. In addition, environmental studies have not been conclusive about the technology’s impacts, which some people say might include water pollution, tremors or methane leaks.

Links:

Economy:

From sunset to new dawn | The Economist
The Insourcing Boom | The Atlantic
Fracktacular | The Economist

Environmental Issues:

Future of Natural Gas | MIT
Strong Rules on Fracking in Wyoming Seen as Model | NYT

Other:

Out of the deep | The Economist
Natural Gas Drilling in Pennsylvania | State Impact
The father of fracking | The Economist
Landscape with well | The Economist

Ecuador and its Rainforest

In 2007 the Ecuadorian president, Rafael Correa asked leaders of the world to pay Ecuador $3.6 billion dollars in exchange for not drilling under the Yasuni National Park in the Amazon jungle. But after receiving only $13.3 million (less than 0.4% of the initial request), Ecuador’s president cancelled the offer and is now proposing to drill under the park which holds an estimated 840 million barrels of oil, valued at $18 billion.

The park however, contains countless endangered species of animals and birds and hosts Amerindian people living in isolation, some of them possibly living in the designated drilling areas. The Ecuadorian government has said that it will only disturb 1% of the park’s area, but environmental groups and NGOs have since began fighting the project which might end up being decided through a national referendum.

Links:

It’s hard to be green | The Economist
On Armenia, Ecuador, e-cigarettes, Azerbaijan, 3D printing, Germany, Machiavelli, Bon Jovi, Congress | The Atlantic
A volcano erupts | The Economist
Episode 433: Holding A Rainforest Hostage? | NPR
Ecuador To World: Pay Up To Save The Rainforest. World To Ecuador: Meh. | NPR
Why Ecuador's president is misleading the world on Yasuni-ITT | The Guardian
Rain Forest for Sale | National Geographic
Yasuní National Park | National Geographic

"Bunkering" in Nigeria

By some estimates, more than 10% of Nigeria’s oil production is being stolen every day. This amounts to 300,000 - 400,000 barrels of oil per day, which on a yearly basis could be worth more than $3.5 billion.

“Bunkering”, as oil theft is known in Nigeria, happens at multiple scales, from the local community of fishermen, stealing and locally refining small quantities of oil, to international criminal networks, siphoning thousands of barrels of oil a day into barges and ships that then sell the oil to international refineries and trade it on the international market. Similarly, the networks of people involved in this trade span a wide range of professions, including local farmers and fishermen, security forces, oil industry staff, members of the military and even politicians, in addition to international arms and drug smugglers, pirates and financiers in London, New York and Geneva.

Finally, pipeline sabotage and bunkering also cause widespread oil spills and ecological damage to the Niger River Delta, threatening the livelihood of local farmers and fishermen.

Links:

Oil Spills:

Shell urged to pay Nigeria $5bn over Bonga oil spill | BBC
Nigerian agencies seek $11.5 billion oil spill payout from Shell | Reuters
Niger Delta pollution: Fishermen at risk amidst the oil | BBC
Nigeria: 'World oil pollution capital' | BBC

Corruption:

Local Refineries:

Nigeria's booming illegal oil refineries | The Economist

Other:

Stakeholder Democracy
Nigeria’s Criminal Crude: International Options to Combat the Export of Stolen Oil | Chatham House

PORT TO PORT

Piracy in Somalia

Links:

Piracy Finances -

Private Navies and Armed Security:

Piracy as a Game?

Other:

Video:

The Venezuela-Cuba Oil Deal or Venezuela’s Oil Diplomacy

Links:

What Chavez’s Death Means:

Cuba’s Own Oil Reserves:

Other:

The Northern Sea Route and the Northwest Passage

Links:

First Voyages:

Commercial Advantage:

Environmental Issues:

Other:

America’s Shale Gas and Oil

Links:

Economy:

Environmental Issues:

Other:

Ecuador and its Rainforest

Links:

"Bunkering" in Nigeria

Links:

Oil Spills:

Corruption:

Local Refineries:

Other: