Sunken Tanker Didn’t Exist!

The latest failure reveals the sorry state of Russia’s infrastructure.

Spilled oil from a sunken tanker near the Black sea has killed more than 30,000 birds, and is already being hailed as an “ecological catastrophe.” Thousands of tons of fuel-oil and sulfur fell into the water in the worst environmental disaster for the region in recent memory. The ship was one of a number sunk or damaged in a stong storm that hit the strait of Kerch, which separates the Black Sea from the Sea of Azov, and serves as a boundary between Russia and the Ukraine.

Officials from both countries rushed to point fingers and find reasons for the calamity, blaming port officials, the ship captains, the companies operating the ships, and the storm itself. Yet as the cleanup effort of the more than 40 kilometers of coastline begins, the Ezhednevniy Magazine has reported some disturbing evidence that suggests the problem runs much deeper. As Boris Zhukov writes, one of the tankers, Volgoneft-123, didn’t even exist.

According to the Paris Memorandum, a regional agreement which regulates standards and conditions of maritime vessels, the Volgoneft-123 has been registered as “dead,” or deactivated, since 2004. The ship, which suffered serious damage but was ultimately saved by the crew, was also uninsured.

The Volgoneft-139, its sister vessel, was not so lucky. The ship’s hull cracked in two under stress and expelled its fuel-oil cargo into the water. It turns out the Volgoneft-139 did not have a register of shipping, that it, the right to sail in open waters. What it did have was an inspection report from 2004, which detailed the vessel’s wretched condition, including rust on the platings, and a crack in the hull. No repairs have taken place since 2004. In fact, the company that owns the vessel, Volgotanker, has been in a state of “permanent bankrupcy” since 2005. This has not slowed down the company’s oil shipping operations, which span Russia’s major waterways, fresh-water lakes, and even reservoirs.

The situation in the ports where the tankers sank is no better. Though described as a “loading and unloading complex,” the Russian zone has few facilities, and nearly all cargo transfers take place directly from ship to ship. The same is true of the Ukrainian side, which is simply a docking station. Though both facilities oversee the exchange of oil, sulfur and waste, neither had the capacity or equipment to deal with an oil spill on their own.

There is also evidence that customs officers slowed down the rescue and salvage efforts. The Caucasus port service, which oversees the Russian side of the strait, prevented oil from being pumped out of the damaged “Volgoneft-123” tanker for nearly 24 hours, noting the fuel had already cleared customs. quoted Chris Weafer, chief strategist at UralSib Financial Corp. in Moscow:

“[There are concerns about Russia’s] aging infrastructure and the effect of minimal investment in upgrading and maintaining it since the end of the Soviet Union.

“Years of under investment don’t just mean a low level of production growth in oil and gas, but the increased risk of transportation infrastructure failure.”

Even with record-high oil prices, and a windfall of cash, Russian authorities have done next to nothing upgrade the oil infrastructure, much less any other facilities. This begs the question: where is the money going?

In Zhukov’s opinion, the inept response to the Kerch catastrophe shows the inability of the government in dealing with day-to-day activity in Russia. Putin’s move to “vertical rule” supports a system that can only react selectively to problems (by, say, closing a company, or shutting down a newspaper). Unfortunately, such a top-heavy structure has few resources to promote safe transportation facilities, protect the environment, or manage any of a thousand responsibilities of a normal government. Which means that Prime Minister Zubkov’s promises to “formulate standards for a safe shipping industry” have little actual value.