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Environmental Preservation in Shipping

We take various measures for environmental preservation. In this chapter we would like to introduce following three activities. Reducing Greenhouse Gas Emissions, Double hull requirement and Proper treatment of ballast water.

Overview of Main Environmental Preservation Measures
1. Reducing Greenhouse Gas Emissions

Vessels operate on heavy oil, and hence generate greenhouse gases, such as CO2, although the energy consumption per transport unit is small compared with that of airplanes or automobiles.

We are striving to reduce GHG emissions by various measures for energy savings.

In fiscal year 2007, the total GHG emissions increased due to our business expansion, however, the operational cumulative emissions per ton slightly decreased.

* Please find the detail in Safety and Environmental Report 2008

2. Double hull requirement

In 1989, a vast amount of crude oil was spilled off the coast of Alaska due to the grounding of the VLCC (very large crude carrier) Exxon Valdez. As a result, a revision of the International Convention for the Prevention of Pollution from Ships (MARPOL 73/78) was adopted by The International Maritime Organization (IMO) Marine Environment Protection Committee (MEPC) in March 1992. The revised Convention demanded that all new oil tankers completed after July 1993 be double hulled and limited the operating period for existing single-hulled tankers. Double-hull construction maintains the integrity of cargo oil tanks even when the outer shell is compromised in an accident.

However, following the Exxon Valdez disaster, there were further oil spills, such as when the Erika broke up and sank off the west coast of France in December 1999, and the Prestige, which also broke up and sank off the coast of Spain in November 2002. As a result, the IMO MEPC has adopted an accelerated phase-out scheme for the retirement of single hull tankers. As of April 2005, a single hull tanker of 5,000 DWT or more shall be scrapped when the vessel reaches the age of 25 years or in 2015 whichever comes first.

Since 1982, when our company first introduced double-hulled tankers, we have constantly striven to build tankers according to this design. As of October 2002, all oil tankers (crude oil and product tankers) and chemical tankers in our fleet are double hull tankers.

3. Proper treatment of ballast water

In ballast condition, vessel pumps seawater (ballast water) into the ballast tank. The vessel uses the ballast water to adjust its draft and trim in order to stabilize itself and maintain propeller and steering efficiency. Ballast water is usually loaded at the port of discharge and discharged at the loading port. Since the late 1980's, migration of marine organisms, such as small animals and plants and harmful microorganisms contained in ballast water has been blamed for affecting the ecosystems of loading port waters.

The International Maritime Organization (IMO) had many discussions on the issue of ballast water. In February 2004, an international convention was adopted that prescribed standards for ballast water management and treatment. It was also agreed that in future it would be compulsory to install a ballast water treatment system.

Our vessels replace ballast water in open waters, as required by the convention and local regulations applicable to ports of call, in order to avoid importing foreign marine organisms into the port of call waters from the perspective of protecting biodiversity.

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