Labuan’s ship-to-ship cargo transfer creates auxiliary services, economic activities

Photo for illustration purpose.

LABUAN: Ship-to-ship transfer of cargo activity in Labuan waters is vital in generating auxiliary services and economic activity, said Senator Datuk Bashir Alias.

He said the ship-to-ship cargo transfer which is part of the components in the logistics industry provides significant macro contributions to the national economy by creating employment, national income and foreign investment influx.

“On the micro scale, the logistics industry is a key industry in increasing the competitive power of corporations… As such we are optimistic this newly-implemented ship-to-ship activity has economic impacts on Labuan,” he told Bernama today.

Labuan-based Victoria STS (Labuan) Sdn Bhd opened a new chapter in cargo handling, carrying out a ship-to-ship (STS) crude oil transfer operation for the first time ever at the Labuan port limit of Victoria Bay on May 10.

Victoria STS, with specialist expertise in offshore handling of liquefied gas and bulk petroleum cargoes, received its first licence on July 31, 2021 to conduct STS operations of oil and liquefied gas products within the Victoria port limit of Labuan.

The STS transfer in Labuan waters which augured well for the development of the Labuan maritime-related activities, involved 580,964 barrels of crude oil from Seria Brunei and was conducted at one of the six approved berths with safe water depths of up to 30 metres, and located next to the marine park of Kuraman Island.

“The implementation of the new transshipment activity is timely in view of the uncertainty and slowdown in economic activities on this island… Labuan’s economy had been on the decline over the years,” Bashir said.

Bashir, who is also Labuan Corporation’s advisory council chairman, said among the economic activities that could be generated from the ship-to-ship cargo transfer are the supply of lubricant, maintenance, arrays of equipment used, tugs, pilotage, engineering-related works and services from Persons in Overall Advisory Control (POAC) for STS operations.

“We believe this activity can also be extended to the existing shipping agencies in Labuan as they can be engaged as agents.

“We have also seen new tug service companies established in Labuan to support the STS transfer activity, and we anticipate other auxiliary services that complement the ship-to-ship transfer activity to grow in Labuan such as blending facilities, thus the economics and job opportunities will also expand,” he added. − BERNAMA

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