PALMALI IS A RELIABLE PARTNER FOR SHIPPING AND PETROLEUM COMPANIES

EFFICACY OF SHIPPING BUSINESS IS IN RENEWAL OF THE FLEET

Palmali shipping company has been successful in shipping and shipbuilding for over five years, and today it can be asserted with confidence and pride that the company has indeed become a reliable partner for many shipping and petroleum companies, as well as for shipbuilders and other shipping related companies. From the very first days of its existence, Palmali has been aiming to maintain competitiveness by continually improving its services in the international shipping market.

The company's managers understand that the sectors of market the company is positioned in are subject to increasing globalisation and are strategic for economic reforms in the countries of the region. Therefore the ability to respond quickly and effectively to perpetual changes, winning new markets and accurately planning employment for the fleet is imperative for success of the company.

The company's managers realise the necessity to strictly adhere to international standards for prevention of pollution, rules and regulation for the shipping industry and corporate management and transparency issues.

Established in Turkey in 1998, Palmali started by providing agency services to other companies whilst at the same time beginning to create its own fleet.

Mansimov Mubariz Kurbanali oglu made a great contribution to the establishment of Palmali and based the company's strategy of development on renewal of the fleet. These years were the period of rapid growth of Palmali.

Today, Palmali is an expanded shipping company which transports cargoes via inland waterways in the European part of Russia and in the Black Sea, Caspian Sea, and Mediterranean. The company has wide experience in the transportation of petroleum products (gasoline, diesel and heating oil, fuel oil, gasoil, vacuum gasoil, lubricants, etc.) and edible oils (vegetable oil, sunflower-seed oil, etc.) as well as bulk and general cargoes (grain, steel, timber, etc.).

The company continuously improves management and operation, increases staff and number of seafarers, establishes new branch offices, links partnership relations with leading shipping and petroleum companies, and increases its fleet. Smooth and safe operation of the ships is ensured by the control from the main office in Istanbul, Turkey, as well as a network of branch offices in Azerbaijan (Baku), Russia (Moscow, Rostov, Volgograd and Astrakhan), in Ukraine (Sevastopol, Odessa and Kerch) and in Greece (Piraeus and Thessaloniki).

The success of Palmali accounts for its using all methods and resources to ensure the most skilful and efficient management of the fleet. Right strategy, experience and professional staff secure the company's position among leaders in the field. In the environment of a tough competition, Palmali continues to hold with confidence its niche in international trade. Well-defined business policy that enables to take right decision is the key to the success of Palmali.

Employees of Palmali Group of Companies always follow their main principles: to maintain high quality at every stage of work, in accordance with international standards. The head office works out new projects and strategy for achieving the company's targets. The principles of Palmali group in business are quickness, quality, conformity with international standards and adaptation of the last technical innovations. The company's ships are manned with highly qualified crews from Russia, Ukraine and Azerbaijan. Palmali is greatly interested in recruiting new specialists and continuous improvement of skills of its employees. According to agreements with marine colleges and academies of water transport, young seafarers have the possibility to practice on board Palmali ships, after which the best of them may be offered officer's rank on these ships.

Activities of Palmali Group are not confined to only managing its own fleet. The company time-charters vessels of up to and above 100,000 DWT of "Aframax", "Suezmax" and "Panamax" type. In sum, Palmali manages over 100 vessels, whereof 40-45 are in time charter, in trust or bareboat charter. They are mostly Greek-owned vessels of 35,000 DWT, 60,000 DWT and 120,000 DWT on a long-term time charter, carrying crude oil and oil products from Odessa, Novorossiysk and Tuapse.

For best results in the shipping business, the fleet must be renewed. Older vessels lose competitiveness: they need repairs and their operation becomes more expensive. Palmali fleet is aged on the average 6-8 years and is being always reinforced with new vessels. For example, in June 2002, the first Armada-type tanker "Armada Leader" was launched, in March 2003 the second tanker "Fariz Ismailkhanov" left the shipyard, and in April 2004, the third tanker "Armada Trader".

These tankers were built in Turkey in the Selah shipyard under supervision of the Russian Maritime Register of Shipping and prove to be among the most effective sea-river tankers. The project was elaborated by Maritime Engineering Bureau (Odessa) in cooperation with specialists of Palmali.

Today Palmali continues building vessels of that series in its acquired and modernised shipyard "Ada Shipbuilding Yard" in Tuzla, Turkey. On the 1st of February, 2004, the keel was laid of the forth tanker "Armada Navigator", which is scheduled to be launched in September this year.

The tankers' construction is carried out considering latest technologies and requirements of International conventions on environmental protection and International Codes on safety at sea. The construction of the vessels of this type is being carried on around the clock under the supervision of the Russian Maritime Register of Shipping. The metal for the vessels' hulls is supplied by the metallurgy plants of the Ukraine which ensure optimal price/quality correlation and all the equipment is purchased from the best Western manufacturers such as "Wartsila" (Finland), "Schottel" (Germany), "Caterpillar" (USA), "TT Boyler" (Denmark), "JRS" (Japan). Each vessel is equipped with two "Schottel" azimuth thrusters for propulsion, which significantly improves manoeuvring performance and also cargo area. 1,1 meter high coaming is installed along the whole length of the cargo area in order to increase tanker's capacity and simultaneously retain dimensions on the main deck. The total capacity of the cargo tanks amounts to 7294 sq.m. A vessel of this type has six cargo tanks for carrying oil and oil products without any limitations on flash temperature. It is possible to carry three kinds of cargo simultaneously. The vessel's painting, including cargo and ballast tanks layers, is carried out with the "Jotun" products.

For unloading this type vessels are equipped with six submersible cargo pumps with output of 150 m3 per hour with cargo and ballast operations' control panel on the wheel-house. Unloading operation takes only 6-8 hours. Cargo tanks are equipped with heating - there are two steam generators manufactured by "TT Boyler", Denmark.

Navigational equipment of the "JRC", Japan, includes two sea radars and a river one. Tankers are also equipped with an electronic navigational "Transas Marine" system.

The crew of twelve people is accommodated in single cabins equipped with a "Climate Master" system for maximum comfort.

The vessels are assigned to the II-Restricted areas of navigation, which allows operation in Caspian Sea, Black Sea and Mediterranean and in the Russian inland waterways.

As mentioned above, on 26th of April 2004, the third Armada type tanker (project 005RST01) was launched in Tuzla, Turkey. The name of the vessel is "Armada Trader". The tanker had been ordered by Palmali and was built in the Selah shipyard within an extremely short time. The vessel has double compartments rendering it unsinkable and is planned to be used as a carrier of chemicals (IMO 3). It is the first sea-river vessel in the history of Russian shipbuilding built as a carrier of chemicals. Manoeuvring performance is enhanced by adoption of azimuth thrusters and a Schottel thruster. The tanker is sailing under Russian flag and is registered in the port of Taganrog.

The launching ceremony of the mt "Armada Trader" was attended by representatives of the diplomatic corps of Azerbaijan and Russia and maritime administration of Turkish Republic, as well as representatives from the major shipping companies.

The experience of operation of the first two vessels of the series (mt "Armada Leader" and mt "Fariz Ismailkhanov") has confirmed rightness of the project concept and profitability of the tankers' operation. It is planned to put in operation 10 units of the same project by the end of the year 2006.

The shipyard owned by Palmali is situated near by Tuzla city. Its opportune location at the Marmara seaside ensures an easy approach from the directions of Black Sea and the Mediterranean for vessels requiring repairs or technical equipment.

Wide experience of the shipyard's engineers enables them to solve any technical problem connected with ship's repair. Besides that, they work out own projects. Palmali plans to build 150,000 DWT vessels. Construction of the first Suezmax tanker is in progress. It is due to be completed by early 2005.

For the navigation 2003, two non-propelled oil barges register without restrictions for the transportation of cargo at flash point temperature were put in operation at Volgograd Shipbuilding Plant. Building of oil barges continues. On 14th of April 2004, the third oil barge of the project 004ROB05 came into operation in Volgograd, named "Paloil-3", and on 5th of May, the fourth barge "Paloil-4". Delivery of the fifth barge is scheduled for the end of May this year.

The company does not limit itself with only tankers. A contract was signed with the same shipyard for a series of dry cargo vessels of 6,970 DWT.

On 21st of March 2004, at Volgograd Shipbuilding Plant an official launch ceremony of the first ship of the series took place. The ship was named "Heydar Aliyev", in honour of ex-President and Azerbaijan national leader Heydar Aliyev. That is a multi-purpose dry cargo sea-river vessel of 6,970 DWT (project 006RSD05). For the first time in the history of Russian transport shipbuilding, azimuth thrusters were used. The projects of this series of the vessels, as well as the "Armada" type, was designed by Maritime Engineering Bureau (Odessa) in co-operation with engineers of Palmali.

The vessel is intended for carriage of general, bulk, grain and large-dimension cargoes, timber, international standard containers with height of 8.5 and 9 feet, and dangerous cargoes. The vessel will be operated in inland waterways of the European part of Russia, passing the Volga-Don canal, and also at sea in accordance with her class, including trade around Europe, between European ports and Caspian Sea, and Azov Sea / Black Sea - continent, etc.

The project of the vessel was designed for a class of the Russian Maritime Register of Shipping and meets requirements of all international conventions in effect at the moment of laying the keel.

Hull double-skinned, double sides. Strength of cargo holds' structures is sufficient for uneven load, and general longitudinal and local strength of the hull are ensured to meet Class requirements. Steering, main engine, thruster and azimuth thrusters, means of radio navigation, etc. are controlled from the central control panel in the wheel-house. Operation is also possible from side control panels. An automatic system enables steering from the wheel-house without a permanent watch in engine-room. Accommodation for the crew of 14 men includes single rooms with WC and shower.

Presently a construction of the second of this 6-ships series is in progress and is scheduled to be completed in September 2004.

Palmali actively trades in the basin of Caspian Sea. About 600,000 tons of petroleum products are carried monthly for major oil companies. Palmali still intends to expand its activity in Caspian Sea, concluding contracts with other important charterers in the region. Palmali plans to increase the quantity of transported clean petroleum products (gasoil, heating fuel oil, gasoline).

Besides that, Palmali is participating in building of a modem port in Lenkaran. The new terminal is intended for transshipment of general cargoes and containers. The ceremony of laying foundation of the port has been attended by President of Azerbaijan Mr. Ilham Aliyev.

Strategic target of Palmali is renewal of the company's fleet, by building new ships as well as by purchasing. In accordance with the company policy, age of purchased vessels should not exceed 10 years. Thus, Palmali fleet has recently acquired the following vessels:

SFAT type, project 19612 - 3 units, Lukoil type, project 0201L - 5 units. Negotiations are in progress for a purchase of 5 more units of project 0201L. Negotiations are also carried on for a purchase of a 6000 DWT sea tanker. All these vessels were built in 2000-2003.

The program of new buildings provides for putting in operation 8 units of new fleet in 2004. Besides that, the company is considering the question of extending building the "Armada" series up to 20 units, implying putting the last ship of the series into operation before the end of the year 2008. It is intended to place the orders in Turkish and Russian shipyards.

Apart from all that was said above, Palmali has a lot of other everyday concerns, including sponsoring in different spheres of culture, sports, public health and protection of environment.

The company sponsors the projects of maximum public benefit. Giving help is a part of social life. Palmali holds that it is everybody's duty, to contribute to successful development of State as well as society.