Tuesday, February 22, 2011

Managing Pirates and Speculators at the same time is the challenge of our time

Global Strategic Enterprises, Inc for Peace and Prosperity- www.globalbelai4u.blogspot.com


February 21, 2011

Can a 'private navy' see off Somalia's pirates?

Escorted convoys are a step towards tackling Indian Ocean pirates – but only security in Somalia can eradicate them

Dan van der Vat

A scratch international fleet currently patrols the Indian Ocean in search of pirates, an approach that is 'nearly useless'. Photograph: AP
The pirates of the Indian Ocean, based on the lawless shores of Somalia in east Africa, become more dangerous as the months go by. But they may soon face a new challenge from a privately organised "convoy escort programme" (CEP) after the manifest failure of international conventional naval forces to deter them.

The pirates are probably not quaking in their seaboots, because they still have the upper hand in their campaign to fleece shipping companies, their insurers and even private individuals on yachts whom they suspect of being rich. Paul and Rachel Chandler from Britain, though not wealthy, were held for more than a year. Last week, a private yacht with four Americans aboard was seized off Oman on the way to the Suez canal. But the serious money lies in big ships, notably tankers, and their often immensely valuable cargoes. This month a tanker with £125m in oil aboard was stormed and two seamen died in a hail of bullets.

The insurance industry, which has a strong incentive to take action, is a prime mover behind the CEP, one of several developments that show there is nothing new under the sun when it comes to countering attacks on shipping. Piracy is at the most obviously illegal end of a spectrum that includes attacks on commercial vessels in warfare, governed by the laws and conventions of war, via submarine campaigns (less so) and hijacking for political purposes (not legal at all).

One of Britain's first naval heroes, Sir Francis Drake, was a pirate in all but name, stealing gold from Spain on behalf of a syndicate headed by Queen Elizabeth I, which yielded £47 for each £1 invested. Buccaneers did the same but without privateer commissions, and some became out-and-out pirates in the Captain Kidd mould, roaming the world from the Spanish Main to the Indian Ocean. The British and Dutch fleets attacked the Barbary pirates based aroundTunis and Algiers in 1816, and finally the French colonised most of north Africa in 1830.

The same mistakes are being made today as in both world wars, when Britain twice came close to defeat at the hands of German U-boats. Shipowners took the view, then as now, that organising convoys was hugely complicated and a waste of time and money. It took years for it to sink in that a ship arriving late was worth rather more than one that did not arrive at all. With as many as 160,000 individual sailings per year in the region where the pirates operate, it is argued that convoy is simply impractical. But the virtue of convoy, a body of ships with armed escort, is that an attacker must take on the escort to get at the ships. And nowadays computers can help.

Patrolling millions of square miles of sea, as a scratch international fleet of warships is doing now, is nearly useless. That can be left to reconnaissance aircraft. When pirates use speedboats capable of 50 or more knots, even the fastest frigate cannot get to the scene in time unless it happens to be only a mile or two away.

The pirates have hugely increased their range of operation by launching their speedboats from a long-range "mother-ship" (usually hijacked). Putting armed guards on individual ships has been tried, but may lead to a "shoot first" approach by the pirates, resulting in deaths among attacked crews.

To solve the growing menace of piracy one could go back even further in history. In the last years of the Roman republic, Pompey the Great, Julius Caesar's ally and later rival for power, was awarded the widest commission against piracy on record. In 68BC he was given the Roman fleet, control of the seas and of all land within 50 miles of the Mediterranean coast and told to wipe out the rampant piracy of the time, a constant threat to Rome's grain supplies. It took two years and Pompey was awarded a triumphal entry into Rome in 66BC. But the settlement, made up of quiet deals as much as naval and military action, soon unravelled.

It is tempting to consider amphibious operations along the lawless Somali coast, destroying pirate vessels and their bases and freeing the hijacked ships and their crews. But the "collateral damage" among captives and local people would be immense. So would the expense. The only long-term solution is the restoration of law and order in Somalia as a whole, with a government strong enough to clean up its own backyard.

In the short term, a modern convoy system looks like the only means of stepping up the level of protection against a threat that costs seaborne commerce hundreds of millions of dollars a year. The CEP, a semi-official, public-private partnership of close-escort vessels equipped with fast rigid inflatable boats, is a step in the right direction. But it will need co-ordinated support from governments, shipping companies, insurers and the navies already on the ground to have an effect. That is clearly asking a lot. Meanwhile, if you want your ship back, pay the ransom.

New Business Ethiopia, Ethiopia

February 21, 2011

Ethiopia to Auction Previous Petronas’ Exploration Blocks

The Ministry of Mines of Ethiopia announced that it has retained all five petroleum exploration contracts from the Malaysian giant, Petronas, and plans to invite international companies to takeover the exploration blocks.

http://www.newbusinessethiopia.com/images/stories/eth%20petronas.jpgA-H Previous Petronas Oil Exploration Blocks in Ethiopia

Briefing on the coming five-year plan of the Ministry to employees, Sinkinesh Ejigu, Minister of Mines, noted that the government of Ethiopia has concluded negotiations with Petronas officials with mutual understanding and retained back all the five blocks that the company was exploring.

In October 2010, it was reported that Petronas has decided to transfer its exploration activity in Ethiopia to a US based company, SouthWest. “We have agreed with Petronas officials amicably that there will be no transfer and based on our agreement all the five blocks are now in the hands of Ethiopian government,” the Minister said, responding to newbusinessethiopia.com reporter at the press briefing session following her meeting with the employees last Thursday (February 17, 2011).  

“Now we are planning to auction the blocks for other international oil exploration companies,” said, Sinkinesh refused to go into the details on how the deal was concluded with Petronas. According to the minister, government is very much strict and will do all the due diligence on the potentials of the companies before awarding the exploration sites- 

Her ministry makes sure that the companies to who it will award the sites, ‘are not brokers who plan to transfer the explorations sites to a third party’, according to the minister who commends Petronas for the infrastructures it has built in Ethiopia over the past years investing hundreds of millions of US dollars.  

“We are very much grateful for what Petronas have done in Ethiopia and we respect their decision. We hope to see the company investing in other business streams in Ethiopia in the future,” she said.

Petronas, which decided to quit its oil exploration activity in Ethiopia after spending over 350 million US dollars in the past seven years did not mentioned why it has decided to quit exploration.

Petronas Carigali Overseas Operations (PCOSB) has been in operation in Ethiopia since 2003. Six Petroleum Production Sharing Agreements (PPSA) - five explorations and one development were signed between the Malaysian company and the Government of Ethiopia.

The PPSA covers two distinct regions namely Gambella, which is located in the western part of the country Sudan border and Ogaden Basins. Meanwhile a few years ago, the company has concluded its exploration in Gambella region indicating that there is no oil.

In the eastern part of the country, Ogaden, the company has been working on eight exploration blocks and two development fields until the management finally decided to stop exploration and withdraw from the country.

Now all exploration blocks found in the Ogaden Basin: the Ethiopian government takes 3 & 4, 11 & 15, 12 & 16, 17 & 20 and the Calub & Hilala contract area back. The blocks are proven hydrocarbon bearing sedimentary basin in Ethiopia, with proven gas reserves of 2-4 trillion cubic feet.

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