August 21 2006
LONDON: Owners of ships carrying liquefied natural gas (LNG) will have to accept “spiralling” salaries because their fleets are expanding faster than available crews, according to the Oslo-based shipbroker Lorentzen & Stemoco AS.
The global fleet will reach 354 ships by 2010, from 207 now, requiring another 4,000 crew members, according to the report.
“As shipowners attempt to lure officers away from their present employers, spiralling wages are definitely on the LNG shipping agenda,” said the recent report.
Global trade in LNG expanded 7.8 per cent last year. Global growth in demand is expected to be about 10 per cent a year through 2020, according to Royal Dutch Shell plc.
Lorentzen & Stemoco estimates it takes as long as 12 years for a shipping cadet to rise to the position of master.
LNG is natural gas that has been cooled to liquid form for transport by ship to markets that are not reachable by pipeline.
Insurers are also “worried about navigational errors” that may arise as shippers move away from traditional single-voyage deliveries to making one-off shipments to different ports, according to Lorentzen & Stemoco.
According to Marsh & McLennan Cos, the world’s biggest insurance broker, premiums may rise by as much as 10 per cent to 0.2 per cent of the price of the ship’s value, on concerns about staffing shortages and because ships are making more one-off deliveries in unfamiliar waters.
Traditionally, LNG has been delivered by tankers shuttling between the same loading and discharge terminals, ensuring that sailors are familiar with the voyages they are making and cutting the risk of accidents. – Bloomberg