Valemax: From Whales to Rails!

Port Townsend, December 25, 2010. I hope you have a Happy Holiday. Thank you for supporting "Oil-Electric."

FROM WHALES TO RAILS

You remember the "Whales." It all began last summer when the world was presented with a hastily modified the super tanker m/v "A Whale," sent to save the Gulf of Mexico by skimming oil from a runaway undersea oil well.

m/v A Whale skimming test Gulf of Mexico, July 2010

I was frustrated trying to learn more about this mysterious vessel.

Typing "A Whale" in Internet search engines sent back results ranging from "a whale is …" to "they call me Ishmael."

The breakthrough occurred when I discovered photos taken of her, months before she became newsworthy. A photographer shot the "A Whale," on her maiden voyage, waiting to load iron ore in Brazil. It is all chronicled in "A Whale: Super Skimmer or Great White Elephant?""

Remembering "Oil-Electric" is a railroad blog, I used the paradigm of the Whales to introduce the two longest Heavy Haul iron ore railroads in the world:

• "A Whale: The Rail Connection" introduced the Estrada de Ferro Carajas, Vale's intense Heavy Haul corridor in Brazil. (Vale is pronounced "valley.")
• "B Whale: The Rail Connection" introduced the second longest Heavy Haul corridor, the Saldanha Bay Export Line in South Africa. Part Two of that operation is in "re-write" and scheduled to be published soon.

Originally named Taiwan Marine Transport (TMT), Nobu Su, son of the founding father, known to be somewhat of a gadfly in the shipping industry, changed the name of TMT to "Today Makes Tomorrow."

Beside giving his company an usual name, Mr. Su knows how to have fun with naming ships. In addition to the five "Whales,"A, B, C, D, and E, he owns three "Elephants" A, B, and C, (tankers),


and two "Lady Bugs," A, B, and C, which are PCC's - Pure Car Carriers. And a host of other vessels.




By the end of 2010, Mr. Su's first five "Whales" are commissioned and in service on the oil and iron ore trade routes, with more on the way. (Thanks to Mats, ShipSpotting dot com) IMO number and name:

• 9445473 F Whale - launched
• 9468853 G Whale -launched
• 9470040 H Whale - launched
• 9470052 I Whale (sounds like an Apple mechanical whale...) On Order/Not Commenced
• 9488279 J Whale - On Order/Not Commenced
• 9488281 K Whale - On Order/Not commended
  

Checking with the marine reporting service, this is the position report as of today (Dec 24th) of the five Whales.

"A Whale" is crossing the Indian Ocean, having departed Singapore westbound two days ago. She completed a delivery of iron ore from Brazil to China.


"B Whale." She just completed hauling a load of iron ore from Saldanha Bay, South Africa, to China.

"C Whale." Following a delivery of iron ore to China, she entered the Persian Gulf on Wednesday, to pick up a load of crude oil.

"D Whale." Cannot locate her. The reporting service lost her?

"E Whale." Brand spanking new, is en-route to China with her first revenue cargo of iron ore wrest from the Sishen Mine in South Africa, last reported eastbound Strait of Singapore.

This is the iron ore terminal in Caofeidian, China, 130 miles ESE of Beijing, where "E Whale" will unload.

Regular readers of this blog may recall these vessels represent a departure from standard ore and oil transports. Classified as Very Large Oil Ore (VLOO) carriers. Designed to carry iron ore from Australia, Brazil, or South Africa, to China and Europe.

Instead of back-hauling empty, they can carry crude oil or other bulk liquid.

As an example, earlier this fall, the "C Whale"delivered a load of crude oil to the LOOP - Louisiana Offshore Oil Platform, traveled to PDM Brazil for a load of ore which was delivered to China, and is now in the Persian Gulf, once again loading crude oil.

Careful cleaning of the cargo tanks is requisite when switching from one cargo type to the next. In the "ore ship" mode, only pelleted iron ore is loaded, to prevent damaging tank lining.



A recent visitor to the Blog, remarking on the Brazilian EFC said, (sic) "If you think a 150 car freight with Distributed Power Units is impressive … well, you haven't seen anything yet!" He is correct. These Heavy Haul railroads routinely run regularly scheduled 330-car unit trains, in loop-to-loop service.

From mine to deep-water, computers insure maximum efficiency closely monitoring the entire production process. If there is break down in the mine, a derailment en-route, or a malfunction at the tidewater terminal, the entire process could be thrown out of whack.

Stockpiles at the mine and shiploader provide a shock absorber against such an occurrence.


This recent derailment on the Saldanha Export Line resulted in 100 cars and two locomotives on the ground. 100 cars! That is an entire average freight train off the track! Remarkably, the line was reopened in a week.

While certainly not an every day occurrence, this sinking of an ore carrier at PDM tied up that shiploader for months, until the wreckage was removed. Fortunately, two other berths were available; but this particular accident tied up the deepest loading pier.

To further illustrate the choreography at play, consider the latest "Vessel Position Report" for PDM (Ponta da Madeira, Brazil)

[click to read]

The report is broken down into three major groups:

• Vessels Moored. Vessels currently loading at the three available berths.
• Vessels in the Roads. Vessels anchored in Baia de Sao Marcos Roadstead. 14 carriers lined up waiting to load. Just like a long haul trucker, every minute a vessel is at anchor waiting to load, overhead expenses (bills that have to be paid whether the ship is working or not, like fuel, crew wages, food, supplies, etc., averaging $70,000/day USD,) in addition to charter fees ("rental" of the vessel,) are drawing down profit.
• Vessels Scheduled. Vessels converging from all compass points on PDM. In the next 30 days, 40 additional ore carriers are arriving!
  

While that "pressure" or "potential" is felt all the way up the supply line to the mine managers, the most immediate pressure is on the terminal manager. He has three loading piers, only one of which has enough water along side, to allow the likes of the m/v "Bergh Stahl" to load.

When fully loaded, she sits the equivalent of seven stories into the water along side the pier.

As the worlds largest ore carrier, she can only fully load 350,000 tons of iron ore at PDM, and unload at Europort, the Netherlands. She can fully operate only between those two piers. I highlighted the "Bergh Stahl" on Vales Vessel Position Report. Here is the timetable to get her into position at Berth 1:

• When I wrote this, the m/v Stellar Daisy is loading. She is scheduled to be finished loading 268,620 tons of ore, with an ETD (estimated time of departure) from Berth 1, on December 24th at 3:01AM.
• The Alfred N has an ETB (estimated time at berth) at Berth 1, at 5:30AM. That allows two and a half hours for tugs to pull the Stellar Daisy away from the pier, get her on her way to sea, then assist the Alfred N into the pier and secured, ready for the shiploader.
• The Alfred N has an ETD (estimated time of departure) 24 hours later, on December 25th at 15:29 (not 15:30!)

Vale operates a fleet of tugs at all her marine terminals. This is the newest, assigned to PDM. Tugs are allowed three hours to extract the Alfred N, get her on her way to sea, and assist the Berg Stahl into Berth 1 with an ETB (estimated time at berth) of 18:29 hours (not 18:30!)

I hope this gives you a deeper appreciation for the pressure on the operation, and why the Heavy Haul corridors must be maintained in peak condition to handle long heavy trains efficiently and safely.

Vale orders the largest ships in the world!

The "A Whale" and her sisters are capable of ingesting the contents of approximately 8 - 330 car ore trains. In the neighborhood of 265,000 tons.

These are simplified estimates to illustrate the relationship between vessel demand at the shiploader, as compared to the number of trains needed to fulfill that demand.

In August, 2008, Vale (pronounced "Valley") entered into an agreement with a Chinese yard to begin building a fleet of 16 - 400,000 Dead Weight Ton (DWT) iron ore carries. They will be the largest iron ore carriers in the world.

Steel Cutting Ceremony - September 2010
First 400,000 DWT ValeMax

Financing was completed several months ago. This is the yard where construction is underway on the first four of 16 vessels. Officially classed as "Valemax, " they are capable of carrying 400,000 tons - that's 50,000 tons more than the Berg Stahl.

That means, at 400,000 tons capacity, in round numbers, each ship will devour another 1 to 2 unit trains!

[click to enlarge, click magnifying glass to read]

Obtaining these photos and figures pushed me to new areas of Internet mining skills. I combed through dozens of web sites composed in Chinese, which I then processed through a page translation program, using "Vale" as my anchor word.

Boy, would I love to have a copy of those plans on the wall!

In building their own vessels, Vale will exert market pressure on Australia's Rio Tinto and BHP-Billiton. And pressure on the South African government to keep the Saldanha Export Line in the competition.

By owing their own ships, Vale will be able to micromanage production costs all the way from the mine to the customer, without involving a third party charter.

Vale's operation in Brazil is damn near dead center between traveling around Cape Aghulas, across the Indian Ocean, and up the Asian East Coast to China, as compared to traveling through the Panama Canal, thence a straight shot to China. I measured it out. It is very close.





In anticipation of the Valemax vessels, new deep-water terminals have been under construction for some time in both Brazil and China.

To load these giant vessels, a new berth, Berth 4 is under construction at PDM in Brazil.

For unloading in China, several deepwater improvements are being added. One of the more dramatic is this new terminal at Lanshan, where two massive breakwaters have been built out into the Yellow Sea.

The top breakwater extends almost 3 miles, the lower, 1.7 miles.

Close up of pier under tower crane above

Clearly, Heavy Haul railroads are the critical link in the high stakes iron ore global market.

Thanks to Nobu Su's "Whales," we have been introduced to some high tech Heavy Haul railroads; Vales Estrada de Ferro Carajas, and TransNet's Saldanha Export Line.

I can hardly wait to see the first of the 400,000 DWT "ValeMax's."

Too bad the United States isn't in the game.