Maersk CEO: We Need to Order Less Ships

first_imgWorld Maritime News Staff, October 9, 2014; Image: Maersk zoom Nils Smedegaard Andersen, Chief Executive Officer, A.P. Møller-MærskMaking money by investing into ships on speculation is limited, despite the fact that prices of ships are pretty low, Nils Smedegaard Andersen, Chief Executive Officer, A.P. Møller-Mærsk said yesterday in a keynote speech at Danish Maritime Days taking place in Copenhagen.As explained by Andersen, “ownership is a minus game” because apart of the price there are several other factors to consider when investing in new ships.“The chances are that if you buy a ship today it will cost you the financial cost, coupled with depreciation risk of technological innovation, making it obsolete. What is more, it will cost you quite a lot to stick with that ship for a while. This risk is hugely underestimated,” Andersen said.Maersk CEO said that their practice was to buy ships the company needs as late as possible, thus running less risk.One of the discussion topics of the forum was: Why shipping is not an attractive industry per se?Andersen said that blaming overcapacity, over-financing and too little scrapping was a very simplistic way of putting it. However, “ordering a little less and looking a bit further in the future, focussing much more on market leads” would be a way forward for the industry.Speaking of the future of the workforce, Maersk CEO referred to a good initiative in Denmark which saw establishment of a university study of marine transportation technology and management.“Making sure you have a pipeline of well educated people is absolutely feasible,” he said, adding that Maersk has had various education programmes so far for both high-school and university level attendees.“We have to be ready for the employees of tomorrow as they will ask more of us than just a salary.They want a vision. They want to know why are they there and feel a part of something that will change the world for the better,” he concluded.The Danish Maritime Forum opened its doors yesterday morning.The forum included group sessions, deep dives and panel discussions during which the participants were asked to come up with concrete ideas to solutions to the upcoming challenges for the industry.last_img read more

Joint venture at Mopani between Rig Resources and Redpath boosts local economy

first_imgDespite sluggish global commodity prices that continue to cause an ongoing slump in the mining industry – skills transfer and job creation have been empowering local employees at the Mopani copper mine in Zambia, thanks to a joint venture between Redpath Mining SA and Rig Resources Zambia.Since officially entering into the three-year joint venture (JV) in March 2015, employment at Rig Resources has almost doubled from 217 employees to 433. Rig Resources Managing Director Anthony Kabaghe points out that this is an impressive feat in current market conditions. “The formation of this JV is clearly the beginning of more positive things to come,” he explains. Although still employed by Rig Resources, the employees now form part of the JV partnership, which is currently comprised of 421 locals and 12 expats, who are all working for Mopani on its various shafts. “The advantages that this JV can offer Mopani go far beyond mining solutions, and will positively impact both the Zambian economy and local communities,” says Kabaghe.Redpath Mining SA MD Ockert Douglas indicates that both companies were working as independent contractors for Mopani, but it was clear that the client and the companies could benefit by combining their years of experience and resources. “Redpath Mining SA has been involved with Mopani since 2012, and is currently executing some of the mine’s capital projects.” Douglas adds that mining operations across Africa, such as Mopani, are looking to increase the use of local labour and skills. “This benefits the communities in which we operate and, in turn, the country. The opportunity arose for both companies to create a suitable business venture with many of the elements that the mining operation and Zambian government were looking for.”According to Kabaghe, the JV currently covers the Mopani project at four sites – Mindola North, Mufulira, South Ore Body and Central. “Rig Resources provides local labour and Redpath SA brings in experts to train local staff. Another major benefit that Redpath SA brings to the JV is its impeccable safety record, which currently stands at 448 days incident-free at Central shaft.”International contracting skills and expertise will be transferred during the course of the three-year contract, as Redpath SA provides Rig Resources’ local employees with hands-on training. The finance function will continue to be provided by the local team with support from South Africa, while all future capital required to meet increased production capacity will be borne by Redpath.Apart from the initial $5.4 million invested by Rig Resources, Douglas states that all future capital will be funded by Redpath’s international head office in Canada. “Our technical expertise in terms of contracting, maximising the use of mechanised trackless equipment, and the provision of a resource base of international professionals are also part of the deal,” he continues. Douglas adds that Rig Resources brings local skills and knowledge of the Mopani Mine as well as business relationships in Zambia to the table, thereby creating a full-circle joint venture that has benefits beyond just the two companies. He continues: “We believe that we need to build the current JV to a respectable level, where we fully meet all the needs of the current client. Once this is bedded down, the opportunity may arise for us to undertake additional work together.”Douglas acknowledges that the downward commodity pricing cycle has negatively affected the global mining sector, including Zambia, which is currently not earning the desired foreign exchange that it used to. “These pricing cycles come and go, and I am confident that prices should move upward in the not-too-distant future. Zambia is a country with many years of upcoming mining projects. These mining projects have assisted in growing the country and will continue to do so.” Kabaghe is upbeat about the future outlook for the JV. “Expansion continues to take place at Mopani, which is drilling more shafts in order to be sufficiently prepared for an uptake in production when commodity prices recover.”last_img read more