FSO Safer: Where do we stand at the start of 2023?

The plan is for Phase One of the rescue plan to be completed in 2023. That was supposed to happen in 2022.

Source: Ministry of Oil and Minerals, Republic of Yemen

Since late October 2022, when it was announced that Phase One of the Safer rescue plan looked to finally be underway, it has been a bit slow on the public news front, besides some back and forth between the two warring parties in Yemen about who was responsible for the delays in getting the oil off the decaying oil tanker. (A topic for another time perhaps.)

While I provided a brief summary on Twitter regarding the latest developments at the time, they have not made their way to this newsletter until now; rather late than never is my only defence. So here we go.

What was announced at the end of October 2022?

A report from Arab News outlined the following:

1. Cash funding has been secured: “The UN has begun phase one … after obtaining funding from donors.” While by then we already knew that the required (and reduced) target of $75 million had been fulfilled through pledges from mostly government agencies, the sticking point to get the operation properly started was getting receipt of the cash; presumably this had now occurred.

2. Contracts are yet to be finalised with the salvage company: According to Russell Geekie, Senior Communications Advisor to the UN Resident and Humanitarian Coordinator for Yemen, “Preparatory work for the operation has already begun, including the processes to contract the salvage company and procure the vessel that will hold the oil”. We’ve known since May 2022 that the very experienced and industry-leader Dutch company Smit Salvage were going to be the salvage operator - so presumably this meant the drafting and signing of commercial contracts.

3. Procurement of the temporary vessel to hold the transfer of oil still pending: As Geekie stated above, the oil needs to be put into something before the permanent vessel, the subject of Phase Two of the plan, is secured.

4. Completion of a detailed operational plan required and a Houthi pre-requisite: The Houthis apparently stipulated that they needed to see an operational plan before they would give the go ahead for further work on the Safer. To this end, the salvage company was expected to conduct a physical examination of the Safer in November before this could be finalised. Now Smit Salvage already had a good idea of how the process would work from a high level perspective as presented to the UN back in May 2022, but an actual physical inspection of the vessel would obviously be needed for a more detailed operational plan.

5. A timetable only to be released after completion of the detailed operational plan: With Smit Salvage having done the inspection and finalised the plan, only then could expected timelines be determined and communicated to stakeholders and the general public.

6. Transfer of oil only realistically expected in 2023: With all the dependencies above, as well as the preparatory and repair work on the Safer by Smit Salvage assumed to have been completed before the transfer of oil could occur, a 2022 start looked entirely unlikely.

So where are we now in mid-January 2023?

For those who have been following this saga, with all the various delays and dashed expectations along the way, it is no surprise that not only was the start pushed into 2023 (it was first hoped to be completed before the winter season of 2022), but that a definite start date is still unclear.

While all the right noises have been made, and meetings have been held to push things along, it appears that the acquisition of the temporary vessel (point #3 above) is now the main issue holding back the mission, with the process to procure such a vessel still in progress. Russell Geekie was quoted as saying that the pain point was the limited global availability of suitable vessels, with prices having spiked thanks to the war in Ukraine.

Greenpeace, who have been on the case for a couple of years, took aim at the UNDP:

We understand the UN FINALLY has the money, but UNDP (who are supposed to be coordinating the multi-donor effort but have no expertise in the oil/shipping issue) are going through internal bureaucratic processes which are creating serious delays and more expense due to daily inflating costs.

The Inter Press Service News Agency summarised Russell Geekie’s response as follows:

He said UNDP has already procured all the services of relevant experts and operational partners including a top-rated marine management consultancy company, a salvage operation company, a shipbroker, a maritime legal firm, an insurance broker company and oil spill experts for contingency planning to support this crucial mission. Other UN agencies are also providing technical support to the operation.

Whether the above process could only commence once all cash had been received - Mr. Geekie confirmed that $73.4 million had been received - or it had hit bureaucratic hurdles well back into last year was not clear.

For now, we wait. With bated breath.