Page 19: of Maritime Reporter Magazine (January 2004)

Government Update various obstacles and added expense in disposing of obsolete vessels from the

National Defense Reserve Fleet (NDRF). After MARAD awarded a contract for the recycling of 15 NDRF ships at a facility in the United

Kingdom, suit was brought by several environmental advocacy groups to block the exportation. The complaint alleged a number of violations of law, including the failure to conduct an environmental assessment and the failure to obtain an exemption from the EPA for the export of PCB for disposal.

The trial court allowed the export of four obsolete MARAD ships as a

Congressionally-approved pilot pro- gram, but has granted a temporary restraining order against export of any further vessels. The major finding of the court in prohibiting further vessel exports is the apparent violation of the ban on export of PCB without an EPA exemption. Subsequently, the UK

Environment Agency withdrew approval for the ships to be recycled, noting that the contractor had not obtained permission to expand its facili- ty to perform such work. The four

NDRF ships may be returned to the

United States in the spring, unless the matter can be sorted out.

As important as the litigation sur- rounding the export for recycling of the obsolete MARAD vessels is the contract that MARAD awarded for this disposal.

Whereas the traditional arrangement for recycling of ships involves the sale of the ship for its so-called scrap value, the

MARAD arrangement provided for

MARAD to pay the contractor $14.8 million for removal and recycling of 15 ships. The high visibility of these exports and the government status of the ships were, no doubt, major factors in this unique arrangement. This payment for recycling of ships, though, alters the traditional view that ships always retain a certain minimal value (the value of the steel and related material in the hull).

The French Government is involved in a similar controversy regarding efforts to recycle the retired aircraft carrier

Clemenceau. The ship apparently con- tains over 200 tons of asbestos. Efforts to have the ship recycled in Turkey met with protests and the ship has been returned to France for removal of the asbestos and any other hazardous waste.

Lest anyone think this problem is exclusive to government vessels, your attention is invited to the chemical tanker Sandrien. This ship, suspected of having onboard asbestos and various hazardous chemicals, has been tied up the Netherlands since 2001. The owners have been unable to obtain clearance from the Dutch government to send the ship for recycling in India because the government is requiring full compliance with the Basel Convention.

Due in large part to heightened envi- ronmental concerns and new apprehen- sions about the safety and health of employees of ship recyclers, we may be approaching the day when owners of both government vessels and regular commercial ships will regularly pay to have their ships recycled.

Minimalization and monitoring of haz- ardous materials on ships is highly rec- ommended.

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January 2004 19