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Shipbreaking in OECD Appendix 1 - SpainInspection of Desguaces de la Arena ship dismantling facility, Northern Spain. One of the identified ship dismantling facilities in Northern Spain was visited and audited on 18 September 2002. Along the Spanish coastline, dismantling of ships has long traditions. However, the activity has declined dramatically since mid 1980íes due to stronger competition from outside Europe and in particular outside OECD territory. At present, dismantling facilities still exists in Asturias (2), Santander (1-2), Bilbao (1-2), Galicia (1-2) and Coruna (1). None of these facilities are organised in association or similar industrial structures. The company Desguaces de la Arena placed in Soto Del Barco in the Asturias Region of Spain was founded in 1975 as a family company. The facility was erected on nature land by establishment of new quarry areas with backfilling erecting a land surface of approximately 18,000 m2. In the period since 1975, the facility has dismantled more than 300 ships equal to approximately 8-10 ships a year in average. However during recent years most of the dismantling facilities in Spain have focussed on subsidised dismantling of fisherman ships. Back in 2001, the latest major ships was dismantled at the facility (80-m and 12-m width ship, totalling 2,110 tonnes). The primary dismantling has been concentrated to former Russian military ships in various classes and sizes with a maximum of 220-m in length. In peak period (1980-1990) more than 60 workers were employed at the facility. At present only 4 workers are permanently employed. As the facility is placed as an inlet facility (access through an inlet channel from the Atlantic Sea - approximately 1.5 km), the depth of the inlet channel dimension the size of ships available for dismantling. At present, the inlet channel has a maximum depth of 6-m. The facility is placed in an area of traditional dismantling activities. In 1970íes not less that 4 different facilities were placed side by side. However, the only existing facility - Desguaces de la Arena - has since the establishment been placed solely on the eastern bank of the inlet channel. Auditing Procedure The site visit/auditing procedure was performed as a combination of forwarded questionnaire (appendix A) and detailed interview by Managing Director Mr. Alberto Garcia in combination with a site walk-over. The Managing Director was quite open sharing information, and provided whatsoever documentation on request (e.g. dates for authority site visit, air photos documenting former activities and names of waste recipients for further contacting if found necessary. The company has fulfilled the forwarded questionnaire the best way possible as a family owned company with limited resources and in-depth knowledge on auditing procedures. The company ensures for updated information e.g. new regulations, standards, accounting principles etc. through their own managing board and through affiliated contracted consulting services. General Impression The overall impression of the facility is an inconsistency in good housekeeping, although recognising that this type of activities traditionally is in need of sufficient space for further processing of the dismantled plates, cables, etc. The site area was surrounded by fence, and immediate after entrance the auditor was approached by managing workers. The ownership structure - family owned company - makes the facility vulnerable for significant improvements due to limited human and financial resources. The close-down of the three neighbouring ship dismantling facilities through the last decade is an example hereof. The capacity of the site range from 2-4 smaller fisherman ships as the lowest affordable level of activity (present level) to 10-12 pcs of up to 220-m length ships. However, due to lack of sufficient skilled working force, the maximum level will hardly be accessible without substantial education of works man in e.g. welding. The present capacity is also restricted due to decreasing possibilities for recycling of secondary waste (machineries, radars etc). These components have due to increasing state subsidiaries, hardly any value longer, why the attractiveness of dismantling ships are almost solely related to world market price on steel. The 95%-fractile dimensioned income from dismantling of ships - recyclable steel - is sold through intermediate due to relatively minor annual production. In the past, the facility sold directly to recycling factories in the region. The revenue costs for recycled steel per tonnes was 90 EUR in August 2002 and 87 EUR in September 2002. The facility operates under different procedures depending of the origin of the ships allocated for dismantling:
Subject: Fisherman ships. Dismantling of fisherman ships are restricted market due to heavy state subsidies (EU support to lay-off of fisherman ships). The ships are received, but hardly any prepayment is launch until the dismantling is completed. The facility has 3-month from the incoming of the ship until the dismantling process must be completed by authority inspection. The facility must initially make a certification of the ship, that no off-gasses are present before any dismantling activities. This certificate is performed by the facility through an authorised person. During the period of dismantling, the facility should accept to have both announced and non-announced inspections of the following authorities;
As an example of the regularity of these inspections, the auditor in below has presented a list of inspections carried out by the most frequent authorities visiting the facility - People Control (working environment, health and security) in the period of 1978-2002;
In the period from 1980-90, the authorities performed 8 visits, but in the decade 1990-2000 only 2 visits reflecting the dramatically fall in dismantling activities during that period. The managing director of the facility emphasised that the company has not track record of any major problems with the authorities and has no track record of restricted orders for improvement during the entire period of operation (almost 30 years). The auditor made a control by looking through all official signed authorities record (copies to the facilities from above implemented inspections), and can confirm that no immediate restricted orders were outlined in the documentation. Subject: Larger ships from the "commercial" market. Dismantling of larger vessels from the commercial market operates in a more "free form". The facility will and has only received vessels where all papers have been in accordance with "normal procedures". The facility only has to fulfil the gas free certification. Dismantling of such ships seems to be under slightly looser control by authorities due to less mandatory requirements informing authorities about such activities (start document, medium term inspections (often not carried out) and completion document (no inspections). In principle such activities can undergo with only one inspection beside whatsoever non-announced inspection which according to above listed dates can be in-between years. The facility claimed to be in possession of a dry-dock, which was inspected. The "dry-dock" was an emptied side-channel which at low tide could allow cutting or larger fraction on dry land. There was no supportive facilities at the "dry-dock" area, which although could be connected to the fact, that this area in latest year main was used a reserve area for ships waiting for dismantling. The "dry-dock" area is not in a condition justifying allowances for dry-dock dismantling activities. Certain improvements are needed prior to such certification. Waste handling Dismantling of ship is a necessity due to constant ageing of ships, change of standards for bulk carrying etc. The dismantling activity will inevitably generate different kind of waste and waste streams. Depending of the magnitude of generated and/or produced waste dismantling facilities perform their own services or operate through intermediating companies. The visited facility works only through intermediating companies. Initially, all content of oil is pumped to a 2 tank on-land system, which in emptied on regularly basis by an authorised company Vigon (subsidiary of the authorised and obligatory company Cogersa, which operates in the Asturias province under the supervision of the authorities). The oil also works as an income source for the company. Any produced clean metal is sold through intermediating company for recycling (income source). The metal was placed on pure uncovered ground (originally infill material). Wood (all kinds - clean, painted, impregnated) are sold directly to privates by the company (income source). The wood was kept in stables for further processing. Steel - sold through intermediating company (largest income source). The steel was placed on pure ground. Machinery and or auxiliaries are sold in case of profit; otherwise the items are more or less without any control (partly stored on the area alternatively presumably disposed off somewhere). The machineries and other auxiliaries were placed directly on the unprotected ground. Cables are sold through intermediating company. The price on cables depends on the cleanness of the cables. No immediate information accessible on incentives to keep "dirty" cables instead of "clean" cables. The cables were stored in top opened iron containers. Additional waste (insulation, various metals, wires etc) must be disposed of through an authorised company Cogersa, licensed to operate in the Asturias Province of Spain, which according to the managing director makes up a monopole situation leading to increasing prices and no competition. The additional waste were mixed together and stored directly on pure ground. Mandatory reporting requirements The facility must make the following annual reporting to relevant authorities.
Occupational Health and Safety The facility was during the auditing operating in lowest possible mode (4 workers and 2 managerial persons). The officers performing cutting was wearing gloves, boats, special clothing and partly helmet and air-breathing protective gear. They also wear eye protective gear while cutting. However, the equipment seemed old and not fully updated. The cutting was only performed in the free and partly on plan surfaces while others were working on unstable ground cutting up the dismantled steel plates. At the facility in total 4 workers was performing dismantling of fisherman ships. The workers are divided into 3 categorises;
The pressure bottles were secure and areas for refilling fenced not allowing the larger central pressure tank to have physical contact with torch gas. The overall impression is that most required safety and protective gear was in place, although not fully used in accordance with regulations. The facility was so small that no safety organisation was in place. The different waste fractions were separated, although only cables and certain types of metals were kept in bottom-closed containers. All other waste fractions were disposed directly on the ground. The facility operates presumably in accordance with Spanish regulations but the overall impression is that the facility is under close-down due to constant stronger competition from non-OECD facilities on the commercial and much more profitable market for ship dismantling. The owner (son of the original founder of the company) has no plans for future expansion or taken over by others. The company will most likely operate on dismantling of fisherman ships under the EU-regulations on fishing fleet, and ultimately close down the activities hereinafter. The company is an excellent show case outlining the consequences and impacts on in-side OECD dismantling capacity from a competitive market mainly driven by non-OECD placed facilities with far less official control. The two-sided market with a subsidised programme for fisherman ships with the EU-region and a commercial market must be tighten up together in an OECD context allowing the remaining few facilities within OECD with a potential as host facilities for larger ships/vessels to operate on proper commercial conditions encouraging the companies to perform necessary investment into new equipment, still improving working conditions and waste handling procedures. Options for Improvement If the Desguaces de la Arena plot should serve as commercial and advisable facility for e.g. dismantling of Danish ships, the below mentioned recommendations for improvements should be enforced and implemented;
Assessment of Basel Draft Guideline (TWG 19, Revision 2) Compliance Assessment of the compliance with Basel TWG 19, revision 2 technical guideline is performed in accordance with Table 11 on "Generic checklist for closing the gaps - achieving ESM-compliance".
The auditor performed an additional visit to a similar ship dismantling facility situation in the harbour area of Gijon - Muelle de la Osa on 19 September 2002. It was not possible for the auditor to meet with the managing director of the facility during the stay in the region, although the auditor did some observation of relevance for this study.
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