States buys fuel ships - "States wasted our money"

States buys fuel ships




The States has bought two specialist fuel carrying vessels in an unprecedented move to ensure the continued supply of oil to the island.
The two ships are both owned by the same company, and are two of only seven in the world that are able to enter St Sampson’s harbour. One of these vessels is the only ship serving the island at the moment.
At a special meeting of States members at Beau Sejour this afternoon, Chief Minister Lyndon Trott (pictured) said that the purchase was made following meetings of the Emergency Powers Authority and the Policy Council.
The council had learned on 17 November that the company which owned the two ships which could serve the islands had gone into administration.
The decision to purchase was made following consultation with an oil industry specialist and shipping advisers. ‘Unless we had reacted with the speed that we did and conducted negotiations in a confidential and commercial manner… there was the very real prospect that the two vessels built to serve these Islands and which to all intents and purposes are irreplaceable in the short term could have been sold to another buyer’ Deputy Trott told members. (from thisisguernsey)

This sounds like very expensive buy to me...

So they can set up an emergency meeting at short notice for this but not on other matters . I am not saying it was probably the only way forward but at what cost.

Also was all the house involved in this decision or just the policy council if it was just the policy council "why" surly it should have been the will of all states deputy's . imo sooner they disband the policy council the better.

‘We all knew we were breaking States rules’




Chief Minister Lyndon Trott and States deputy chief executive Nigel Lewis explain the purchase of two tankers to the media.
CHIEF Minister Lyndon Trott said the Policy Council had no choice but to act without States approval to safeguard fuel supplies.
The landmark move, in which the council gave approval for Deputy Trott to organise the purchase of the only two fuel-carrying vessels currently available and capable of servicing the island, goes against States procedure.
It was a decision that exceeded the Policy Council’s mandate but Deputy Trott said it was necessary to ‘act outside the box’ to ensure that the vessels remained available to the island.
‘Throughout this process, I and the entire Policy Council have been acutely aware that the decision to go ahead with the purchase of these vessels flew in the face of the normal approach of wide consultation, States debate, the securing of a capital allocation and so on,’ he said.
‘However, on the other hand we have also been acutely aware that unless we had reacted with the speed that we did and conducted negotiations in a confidential and commercial manner then there was the very real prospect that the two vessels, built to serve these islands and which to all intents and purposes are irreplaceable in the short term, could have been sold to another buyer. That buyer might well have relocated them elsewhere in the world.’ (from thisisguernsey)

The only thing I do not understand is that the Total Oil Company have just had a ship built for the Channel Islands and this vessel has just started the Channel Island run, as with most companies the vessel is "shared" which means it brings in other fuel companies requirements,

So why has our States purchased two vessels with this in mind, it does no add up...

My problem here as a layman is if the expert shipping company who owns the vessels are in trouble what makes Trott and his merry men think they can turn it around ? The company must be in trouble for a reason.

GD wrote:The only thing I do not understand is that the Total Oil Company have just had a ship built for the Channel Islands and this vessel has just started the Channel Island run, as with most companies the vessel is "shared" which means it brings in other fuel companies requirements,

So why has our States purchased two vessels with this in mind, it does no add up...

Isn't that one of the ships that the States have just bought?

Spirit wrote:Isn't that one of the ships that the States have just bought?

I thought that Total owned their own vessel..

Question???
Like us in Jersey,
If we have no Fuel,
What do we do???

Interesting predicament, if they had a chance to buy and didn't, later when there were no vessels to carry fuel to Gsy we would criticise. Act quickly and preserve our fuel line and we criticise. They can't win can they. Good to see they can act decisively when they have to

In this instance I think they probably did the right thing based on the facts that are presented above. Digger the beauty of making this work is they only have to supply Gsy and can run at cost without making a profit whereas a private company can not afford a loss so Trott doesn't have to turn the loss making company round. The previous company may well have had other areas of no profit making that dragged them down. Lots of factors to consider.

Now all Trott has to do is add some passenger accom' and we will have our own sea ferry as well as airline!!!!

Good point Plimmerton , i must admit having put some thought into it for a while it seems the right thing to do . But what i an concerned about is we do not know the full details here and not being funny but i do not trust some of the Policy Council (no names) that's why it should have been all the assembly to have a say. Now i know time was a major factor (so we are told) but in this day and age it should have been not to much of a problem to contact all the members and hold an emergency meeting even in the evening , lets face it that is what they are paid for.

lets face it he who would be king twotty knew about this on the 17th of november.two states meetings have been held since then with no mention of boat buying at either of them.

Digger wrote:Good point Plimmerton , i must admit having put some thought into it for a while it seems the right thing to do . But what i an concerned about is we do not know the full details here and not being funny but i do not trust some of the Policy Council (no names) that's why it should have been all the assembly to have a say. Now i know time was a major factor (so we are told) but in this day and age it should have been not to much of a problem to contact all the members and hold an emergency meeting even in the evening , lets face it that is what they are paid for.

Hang on did you say evening, hell Corries on, do I get overtime. With todays communications it shouldn't be too hard

A Guernsey politician fears the States paid too much for two fuel tankers.
The company owning the vessels went into administration last month and there were fears Guernsey could be left without supplies.
The vessels were worth between 14m-16m euros when they were launched a year ago, but the States has yet to announce how much it paid for them.
John Gollop raised concerns about the cost and being kept in the dark about the purchase.
But Chief Minister Lyndon Trott told Guernsey States the price was "attractive in the current market" and cheaper than building two new boats.
He said: "We are not so much buying vessels as buying long term security of supply for the Bailiwick."
He added that if the purchase had been debated by the States there was a "real risk" of others buying the tankers. (from BBC News)

BACKBENCH States member John Gollop believes he and his colleagues are being kept in the dark about serious matters.
His comments come after the unprecedented decision by the Policy Council to buy two fuel-carrying vessels.
Deputy Gollop said he would give his provisional support to the strategic action the council took, but he said a commercial attitude was needed to a States-run shipping fleet and careful thought needed to minimise wasteful losses in day-to-day operation’.
‘I have not yet been convinced that we paid the cheapest price for the fleet of two ships,’ said Deputy Gollop.
‘But I can appreciate the need for speedy action and decision-making.’
Chief Minister Lyndon Trott and the Policy Council made the decision to buy the ships to secure the island’s fuel supplies after the owners went into administration last month.(from thisisguernsey)

I have no objection to a quick purchase but LT's comment about buying cheaper than we could build is a worry combined with the fact that they are slow to release purchase price. Gets me to thinking we may have paid over the odds.

GUERNSEY came within days of running out of fuel before the States took control of the supply chain, it emerged at the weekend.
Policy Council sources indicated that stocks of petrol and heating oil were at one stage down to three to four days before the crisis was resolved.
A news blackout was imposed by senior politicians and the fuel suppliers to prevent panic buying. The fear was that unnecessary topping up of cars and oil tanks would have triggered an actual shortage.
The problem was caused by administrators impounding the two ships owned by Swedish firm Svithoid Tankers after it collapsed to prevent the assets from being lost to them.
When this happened, the Vedrey Tora was en route to Guernsey with a full, urgently needed, load.
‘Some very swift negotiations had to take place to get the ship released otherwise the island would have literally run out of fuel,’ a council source told the Guernsey Press.

States is set to own ships for some years








The petroleum products tanker Vedrey Tora is eased from her berth at Sampson’s by the pilot boat. Vedrey Tora and Vedrey Thor have been acquired by the States to secure fuel deliveries after the ships’ owner went into administration.
GUERNSEY looks set to own two fuel tankers for at least the next five to 10 years, a senior civil servant has said.
Responding to questions about the planned timescale for retaining the Vedrey Tora and Vedrey Thor, which were bought by government to ensure the island’s future supplies, deputy chief executive of the States Nigel Lewis said they would be taxpayer-owned for as long as necessary.
‘I would be very surprised if we did not have these ships in five to 10 years’ time,’ he said. ‘We will own them for as long as we need to, for as long as it is in the island’s best interests.’
The States bought the vessels, two of only seven tankers worldwide capable of berthing in St Sampson’s, after the company that owned them went into administration.
The news caused fear that any potential new owner might remove them from servicing Guernsey - cutting off the island’s fuel supply. In an unprecedented move, the Policy Council decided to act without prior States approval to buy the vessels.
Mr Lewis said that other options might become available in the future, such as developing a deep-water berth similar to Jersey’s, which the island could decide to look at.(from thisisguernsey)

I always thought that when St Sampsons Harbour was re-developed that a deep water berth was going to be planned,

But lets face it, The States have taken so long over the airport runway, but that does not matter they own an Airline so no rush there, and now they own a Oil shipping line, So no need to rush to develop the harbour,

Won't be long before all the Transport and freight services are privatised, then we won't have to any upgrades ...

MONEY used to buy two fuel tankers will come from the States’ cash pool, according to Treasury minister Charles Parkinson.
And he said the unusual step of taking money from cash assets to which government has access would not cause any problems.
‘I don’t think it will,’ he said. ‘I’m sure we can absorb what has been spent.’
The States bought the fuel vessels, two of only seven worldwide capable of operating in St Sampson’s Harbour, in an effort to safeguard the island’s supply after their previous owner went into administration.
Policy Council members feared that a potential new owner could remove the boats from servicing Guernsey, leaving the island at risk of running out of some fuels. It therefore decided to buy the boats without the States’ prior approval.
When making the announcement to the media and discussing the funding, Chief Minister Lyndon Trott said that the States had access to ‘a couple of hundred million pounds of cash that is in the system’.(from thisisguernsey)

GUERNSEY paid €16.9m. for two tankers that have guaranteed the island’s fuel supply.
The Vedrey Tora and Vedrey Thor were valued at between €14m. and €16m. each when built a little more than a year ago.
They were bought last month by the States after the company that owned them went into administration.
In an unprecedented move, the Policy Council exceeded its mandate by authorising the purchase after fears emerged that any potential new owner might have removed them from supplying the island.
That would have left Guernsey without any reasonable means of receiving fuel because the Vedrey Tora is currently the only vessel available, out of a total of seven worldwide, capable of using St Sampson’s Harbour.
When he announced the purchase, Chief Minister Lyndon Trott could not say how much the island had paid because due diligence was ongoing.
But in a special Billet d’Etat released today, Deputy Trott said the amount paid took into account the cost of refurbishing the ballast tanks of the Vedrey Thor

GUERNSEY will have to spend well in excess of £100m. to secure future fuel imports, the harbour master has said.
A 1993 States report predicted the island would need a deep-water berth by 2020 and Captain Peter Gill said that forecast was still valid.
‘It was concluded that by 2020 the amount of fuel oil required in the island would have risen to a point where we needed an additional berth. In the absence of anything else, I think that conclusion is still valid.
‘It needs to be done somehow or other by 2020, that’s what we still believe.’
Money was set aside in 2003 for extending St Sampson’s Harbour and, at that time, the work would have cost £93m.
‘That cost was not just for a deep-water berth though, that was to extend the whole harbour,’ said Capt. Gill.
‘Extending it is not the only option now. But with today’s prices, no matter what we do it will cost well in excess of £100m.’
Vessels bringing fuel and other imports into the island have to use the dry berth at St Sampson’s Harbour - a situation which has led to only seven tankers worldwide being capable of using it.

AN OFFER that could save the States millions on its fuel ships is on the table, the Guernsey Press can reveal today.

Earlier this month the Indian Chowgule Group, the shipping arm of which has a local subsidiary, contacted the Treasury Department with a proposal to buy at least one of the tankships the Policy Council has now secured and lease it back to the States.

It is understood that another major shipping company has also expressed an interest after it was announced that the States had bought the Vedrey Tora and Vedrey Thor for 17m. euros.

The Policy Council has consistently said the purchase of the two tankers was the only way to secure fuel supplies to Guernsey after the company that owned them, Svithoid Tankships, went into administration.

Most deputies are understood to be in the dark about the offers, despite being set to debate the purchase at the States sitting that begins today.

Advocate John Langlois is a director of the local Chowgule subsidiary. He was asked by the group’s directors to raise the question (thisisguernsey)

Seems like a few porkies have been told

I believe the States were right to by these tankers. If these new companies have come out of the woodwork, It is for one reason. They see the islands have restricted vessel capabilities, so a chance to make a quick buck and hold the public to ransom. keep the ships and keep control.

Wasn't the idea to take control of the vessels to secure our "fuel" future. If that was the reason then we can not sell and lease from the purchasers cause that puts us in the same boat (no pun intended) as before.

I tend to agree , if another company bought them they could in theory hold the island to ransome.

17 millon Euros for both of them

DJ