Maritime Executive – Indian Ship Recycling ‘Extremely Regulated’

(Written by Shashank Agrawal)

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7 August 2014 - Companies like Wirana in the ship recycling industry are known as cash buyers since they purchase the vessel from the original owners and then sell it to a ship recycler in any one of the ship recycling countries. For vessels purchased “as is,” the cash buyer takes over the vessel at the delivery port and then boards his own crew for the sailing of the vessel. In the meantime, the vessel is reflagged, given a new name and a fresh set of insurance cover for the voyage to the recycling yard.

In India, ship recycling activities are carried out at Alang West Coast. Alang has 175 active and licensed yards, which are leased by the government of Gujarat for a period of 10 years. The strength of Alang is that it relies upon the beaching tides in order to take maximum advantage of the force of the water in pushing the vessel up onto the beach. Both Alang and neighboring Jamnagar are under the aegis of the Gujarat Maritime Board.

In India there are approximately 25 licensing bodies, and the industry is extremely regulated. Ship recyclers spend their own funds to meet the standards of ISO without any financial or other support from any party. Currently at least 120 yards are certified with ISO 14001/9001 and OHSAS 18001 and at least 55 yards have ISO 30000 certification.

Beaching vs. Drydocking

The beaching method of ships has been successfully practiced for several years along the 10-kilometer beach at Alang, which has a very high tidal gradient, leaving vessels out of the water during low tide. A comparative life cycle assessment has been initiated of beachings compared to drydocking in India and involves estimating the environmental footprint of each for both facilities’ construction and subsequent operation.

In the preliminary analysis it can clearly be seen that the benefits of the beaching method practiced at Alang for recycling are far superior to the drydock method. At Alang the following agencies are involved in clearances upon the arrival of a vessel:

1.Gujarat Maritime Board
2.Gujarat Pollution Control Board
3.Explosives Department (for tankers only)
4.Customs
5.Atomic Energy and Research Board.

In the unlikely event that the beaching method of ship recycling is banned, a far greater socio-economic harm will befall the more than 50,000 workers who are directly employed and about 500,000 workers who are indirectly employed in the recycling yards on the Indian subcontinent than any adverse impact on the environment.

Ship Recycling Versus Shipbreaking

Often we see publications switching between the terms “ship recycling” and “shipbreaking,” and perhaps the confusion stems from a lack of knowledge about the eventual end use of the vessel and its contents by the yards. During the process of ship recycling the following items are recovered for reuse and recirculation:
• ship’s steel – this is the primary recycling material and is sold to steel re-rolling mills to convert into rods and bars, which are used in infrastructure projects
• ropes and chains – these are generally re-exported or reused by the ship recyclers themselves
• generators – used in garment manufacturing factories or in the agricultural sector
• boilers – used in rice and jute mills
• furniture, beds, cots, bunks, cabin materials, utensils – used by mid-tier households or public hospitals, emergency camps, hotels, motels, hostels, Red Cross and YMCA
• electrical items, appliances, irons, heaters, insulators – reused by industrial and agricultural units
• refrigerators – purchased by mid-tier households, small hotels and factories
• pipes and fittings, wires, coils, rubber – agricultural and domestic use
• oil and other products removed – depending on the quality, they are resold to licensed factories for their use
• sludges, paints, etc. – are disposed under the guidelines framed by the Gujarat Maritime Board into specific incinerators
• asbestos and hazardous materials – sent to pre-determined, government-approved landfill sites after being appropriately bagged, itemized and sealed.

This is only a partial listing. Everything on a vessel is either recycled or disposed of in accord with government regulations and ISO standards.

More than 8,000 vessels have been scrapped at Alang since 1983, generating steel output in excess of 100 million tons. In an average year Alang recycles about 350-400 vessels with annual sales from this activity of roughly $1.8 billion. Certainly “breaking” would not generate this kind of income! – MarEx

The author is an Indian-qualified Advocate and Vice President (Legal) at Wirana Shipping, the oldest and one of the largest cash buyers of vessels for recycling.