John Faraclas’ guest lecture on 23 February 2024 09:00 at QMUL on “Contract Management/Performance – the Shipping Perspective“
Good MORNING and Thank you Prof. Markopoulos as well as your esteem University of Queen Mary for inviting me once again for another Guest Lecture in your School of Management for your Undergraduate Students bearing the Module Code and name BUS027 Project Management.
Good Morning dear students of this Undergraduate level; Happy New Year to all with Good Health above all and Success in your studies!!! WHEN I SAY HAPPY NEW YEAR, remind you WE JUST HAD THE ENTRY TO THE YEAR OF THE DRAGON AND AS I SEE THERE IS A STRONG FAR EASTERN PRESENCE HERE!
I am thrilled to give this lecture to this University once again, and pleased you are here to attend same, particularly given the time and momentum of what is going on as we speak. A spree of Newbuildings, as well as Conversions and Retrofits of all types of ships take place keeping the shipyards all over Planet Ocean busy and offering or maintaining existing jobs in a very volatile and uncertain Global Economy.
We need ships as: No shipping, No Shopping, No sipping. Ships carry the 90 percent of cargoes all over Planet Ocean; end of the story.
The environmental danger in polluting Planet Ocean HAS PROMPTED US TO PROCEED WITH CONVERSIONS AND RETROFITS WITH MORE FRIENDLY MEANS OF BUNKERING THUS REDUCING THE POLLUTION OF THE ENVIRONMENT WITH EMISSIONS. SHIPYARDS ALL OVER PLANET OCEAN ARE FULL…
This speech assist the technical staff of shipping companies during forthcoming negotiations with the Shipyards and their Brokers, Agents, Trading Houses, affecting projects for: newbuildings, or conversions, or retrofitting, or major repairs/drydockings AS MENTIONED ABOVE GIVEN THE DEMAND EMANATING FROM THE SAVE THE ENVIRONMENT.
The target is to improve their performance when dealing with the technical clauses of future contract agreements and specifications, as well as for the processing of other contract technical documents (mainly when dealing in parallel with yard’s lawyers and company’s legal department). THERE IS ALWAYS A BIG CLASH HERE AS LAWYERS TEND TO FIRE A FAST ONE ON EACH OTHER. BEING A SHIPS SALES AND PURCHASE BROKER AS WELL AS A MANAGER IN MY PAST LIFE, I KNOW TOO WELL WHAT TAKES PLACE AND WHAT IS NEEDED TO DEFUSE THE SITUATION AND DEAL UNDER THE MAXIM: THE BEST ARGUMENT IS TO AVOID THE ARGUMENT.
Furthermore, specialized guidance and recommendations shall be given of “how to cope” the sales and engineering departments of yards and how to deal with them effectively.
Focal Points of my speech:
I will use presentations in a simple way, case studies just to see what takes place, actual examples and specialized exercises – narratives which I have FOR YOU to see some issues on SHIPREPAIRS to “illustrate” the following topics DRYDOCK MAGAZINE (WHICH IS HERE ON A SLIDE) and DNV’s Maritime Academy LATEST Course back in October 2023 – which is very clear and well construed showing all steps and “measures” on has to take, coinciding with my view given my career for decades on Ship Management and shipbroking:
• Different types of contracts and specs, plus comparison of their standard text / clauses. PROF MARKOPOULOS, KINDLY PROJECT THE CONTRACTS OF BIMCO ON SHIPREPAIR)
• Vessels ordered through contract agreements or procured as “Resales” (by MOA) MOA is the MEMORANDUM OF AGREEMENT.
• Responsibilities / tasks of “Builders” and “Buyers” and provision of Refund Guarantee Letters.
• Technical clauses / chapters of contracts, needing careful review and analysis by the Owner’s technical staff.
• Texts of detailed specifications and their chapters / paragraphs & related attachments.
• Review of outline spec. and assess vessel’s design, prior to signing any “Letter of Intent” (LOI).
• Check of vessel’s advantages & disadvantages to assist the prompt decision-making by Owners.
• Methods and techniques for technical negotiations and to ensure different design and outfitting improvements.
• Avoid the yard extras and project price increases, when dealing with Owners’ technical improvements.
• Effective application of “good engineering standards” and “good marine practices”: techniques and methods for their specific incorporation in contract and specification.
• Apply extensively quality standards throughout the design, construction, outfitting, tests, trials and in accordance to the vessels’ type and size / characteristics, plus the Charterers’ inquiries.
• Comply with the regulations applicable on the delivery date of each newbuilding (not simply on the “contract signing date”) and how to cover the time difference of some years.
• Prompt issue of the “Makers List” and to compose efficient procedures for the selection of reliable equipment Makers (as per Owners’ preferences and without extras).
• Review all contract attachments to incorporate improvements in the plans of: General Arrangement, Capacity & DWT scale, Midship Section, Accommodation, Engine Room Arrangement.
THIS PRESENTATION REFERS TO YOU, SAY YOUR ARE TECHNICAL AND NEWBUILDING MANAGERS OF SHIPPING COMPANIES, PLUS FLEET AND OPERATION MANAGERS, SITE TEAM MANAGERS AND SUPERINTENDENTS WITH DIRECT OR INDIRECT RESPONSIBILITIES FOR YARD NEGOTIATIONS FOR MAJOR PROJECTS. MY SPEECH CAN ALSO ASSIST LAWYERS AND STAFF OF LEGAL DEPARTMENTS (OF SHIPPING COMPANIES) WHO SHALL PARTICIPATE IN SUCH NEGOTIATIONS, BUT ACTUALLY NEED TECHNICAL KNOWLEDGE AND EXPERIENCES TO DEAL SUCCESSFULLY WITH YARDS!
Look forward to your QUESTIONS.
THANK YOU!
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There were some interesting questions but lack of time so I hope next time round to have a shorter presentation and more time for Q&A as students, but also all involved have to realise the costs, the incalculable costs in case there is no performance of the contracts signed; be it Shipbuilding, Repair, Retrofit or Conversions.
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*Guest lecture delivered on 23 February 2024 and after popular demand from many who couldn’t be present have decided to upload verbatim my lecture’s notes.
