The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

MARINE industry stakeholders yesterday balked at proposed fees to regulate the lightering industry, one prominent executive describing them as “unheard of” and warning that such a move could kill the sector and “stifle” the Freeport economy.

Several Freeport-based operators attending a lightering regulation and information exchange session, held in Nassau by the Government, voiced strong opposition to the proposed fees - particularly the $0.05 cents per barrel throughput fee.

While stakeholders said they welcomed regulation, they emphasised that increased fees could deter business, particularly in Freeport, which with the Bahamas Oil Refining Company (BORCO) and South Riding Point facilities is heavily dependent on the oil industry. Michael Hall, chief executive of ISS Shipping (Freeport), a major shipping agency that represents the likes of Carnival Cruise Lines and Shell, applauded the Government for its regulatory initiative but warned that the proposed fees could pose a serious problem for the industry.

“The proposal from the Government in itself is good,” said Mr Hall. “It is always good to see government put structure to a business that isn’t properly regulated. I applaud the Government for that.

“We all know the state Freeport is in. The regulated fees they are going to propose is not good for business in Freeport and the marine offshore business. It actually could really stifle the business. That’s all Freeport really has right now, which is why a lot of key stakeholders were here to let the Government know we are taking this safety part of it and the regulations that they’re proposing very seriously, but the fees that are involved are not being supported.”

Mr Hall added: “We really have to take a look at exactly where we’re going with this and get more information before we proceed. This will just stifle the economy of Freeport. We can’t have that happening.

“There is a fee of $0.05 cents per barrel and that’s unheard of anywhere in the Caribbean or in the United States. If that fee is imposed it will basically kill all the offshore business in Freeport.”

The Government was said yesterday to be particularly concerned over recent oil spill incidents in Freeport. hence its move to regulate lightering in Bahamian waters.

Lightering is a process which involves the transfer of cargo between vessels, usually the transfer of oil between barges/bunkers and oil tankers. It is often done to reduce a vessel’s draft prior to it entering port facilities.

The Government is also hoping to generate revenue and create more jobs in the industry.

Brent Williamson, a maritime consultant with the Ministry of Transport and Aviation, said yesterday that based on the strong opposition to the fees, he would recommend that the Government hold off on them for now. He added that there was nothing set in stone as yet.

“Lightering has been going on for a number of years in the Bahamas without proper regulation. We have just introduced draft regulations that intend to regulate the industry. Safety is a priority. We are also trying to create opportunities for Bahamians,” said Mr Williamson.

“There are some fees to be collected from the service, as it is a privilege to lighter in the territorial waters of any jurisdiction. We just want to ensure we are not disadvantaged from a safety or economic standpoint.

“We want to ensure that anything that we do is not counter-productive in terms of fostering and development.The fees are not set in stone. We have agreed to further discussions on the matter. Industry feedback is critical. We want ensure that when we move forward we have the best possible product, .”

Mr Williamson, while unable to give an estimate as to how much revenue the Government was hoping to generate from lightering fees, said one business in the sector had pumped $4 million into the Freeport economy through its operations alone.

“It’s a specialised activity,” he added. “There are a handful of companies on a global basis that conduct lightering. We are hoping to build capacity in the Bahamas by introducing professionals to the industry. In the long-term we will see opportunities develop for new entrants,” said Mr Williamson, adding that several hundred direct and indirect jobs could be created.

Port Controller, Commander Patrick McNeil, said: “The regulations have not been gazetted as yet. What we have done is taken the core requirements from the proposed regulations and put that out to the industry.

“That is our requirement now, so that we start the process of regulating the industry and putting in all these instruments to ensure that safety is in place so that when it does come into law it will not be strange to stakeholders.”