Stolt-Nielsen

Stolt-Nielsen Limited
Public
Traded as OSE: SNI
Industry logistics,bulk-liquid transport,parcel tankers, tank containers,terminals,storage,aquaculture
Predecessor Parcel Tankers Inc.
Founded 1959
Headquarters Bermuda
Area served
 Global
Key people
 Niels G. Stolt-Nielsen (CEO)
Christer Olsson (Chairman)
Revenue USD 2,137.7 million (2014)[1]
USD 129.8 million (2014)[1]
USD 77.7 million (2014)[1]
Number of employees
 5000+ (2014)[1]
Website www.stolt-nielsen.com

Stolt-Nielsen Limited (SNL) is a provider of integrated transportation and storage solutions for specialty and bulk liquid chemicals and a wide range of other liquid products. SNL’s aquaculture division is a producer of turbot and other fish and fish products.

Founded in 1959, corporate services are provided from London. Most of the company’s operations are in the US, the Netherlands and Singapore.

Foundation

Jacob Stolt-Nielsen began his career training at a ship brokerage in London, when he noticed an increase in certain kinds of liquids being shipped over the sea, especially those that served as the base materials for plastics. He moved to New York City in order to work for R.J. Chianelli, a broker in the chemicals industry that focused on these products. He witnessed the explosion in growth of the plastics industry, building on technology developed during World War II. However, the basic materials needed for the creation of plastics were new substances that the traditional shipping industry did not yet know how to ship safely or effectively.

There was a need in the industry for tankers that could transport different liquid chemicals in separation from each other, in order to keep the substances strictly pure upon delivery. There was also a need for the creation of packaging or housing the materials such that they would not eat through the containment. He developed a system using deep-well submersible pumps: one pump and one tank per parcel of liquid, in order to maintain the purity of the substances and the integrity of the containment. For his idea he received 20% of a new venture looking to monetize the idea, with Chianelli receiving 20% and 60% going to a customer of theirs, C.P. Steuber. The new firm was called Chemical Carriers Inc, formed one year after Stolt-Nielsen had first arrived in the US.

The new system improved the cost efficiency of shipping the chemicals by over 300%, resulting in an immediate profit for the company and the nickname "Jackpot Nielsen" for the new method's inventor. The maiden voyage of the new tanker system was made on board the Freddy. This was the prototype for the "parcel tanker", a further development on the idea by Stolt-Nielsen.[2] Stolt-Nielsen leveraged his invention into his work as a ship broker,[3] and in 1959 Stolt-Nielsen officially became a ship owner with his purchase of the Stolt Avance.[4]

Company history

1959-2000

In 1959 he started what would ultimately become Stolt-Nielsen Limited, initially under the name Parcel Tankers Inc. with a chartered ship. The company purchased the Fossvik in 1961, which was renamed the Stolt Avenir, followed by the Ringerd, renamed the Stolt Victor.[5] In 1962 the company opened its first Asian office in Tokyo, in order for the Victor to service that area of the world.[6] By 1963 the company had offices in Oslo, Norway; New York, United States and Tokyo, Japan and was operating 18 ships.[7] In 1965 the company purchased the Stolt Condor and Stolt Atlantic, all time-chartered to Parcel Tankers, and run from the port at Haugesund, Norway.[5] They also began to expand into South America.[8] In 1971 the first storage terminal was acquired and in 1972 Sea Farms (then not part of the Stolt-Nielsen Group) was founded. In 1988 the company issued an initial public offering on NASDAQ. Jacob passed on his position as CEO to his son Niels G. Stolt-Nielsen in 2000, with Jacob staying as Chairman of the company.[9]

The 2000s

Stolt-Nielsen entered an amnesty agreement in January 2003 with the United States Department of Justice, on condition that it fully disclose the operating activities of its competitors and partners. The result of this disclosure led to criminal charges against two companies, Odfjell and JO Tankers. The DOJ rescinded its amnesty and withdrew from the agreement with Stolt-Nielsen in March 2004.[10] Stolt-Nielsen responded by filing civil complaints against the government, arguing that the DOJ had illegally breached its contract with Stolt-Nielsen by withdrawing amnesty. The resulting trial in 2005 ruled unanimously in favor of Stolt-Nielsen and its executives. The court issued injunctions restricting the DOJ from indicting the company and found that the DOJ had not provided sufficient proof that Stolt-Nielsen was in breach of contract.[11][12]

In 2005 the company saw a 61% in operating income.[13] In 2007 the company voluntarily delisted from NASDAQ,[14] and the DOJ dismissed all antitrust accusations against the company.[15] By the end of 2007 the company had recovered from the dismissed allegations, with a $216.4 million profit and a 12% increase in operating revenue to $1.75 billion.[16] The US Supreme Court refused to hear the appeal of antitrust allegations. The decision enabled Stolt-Nielsen to petition the district court in Philadelphia to dismiss the indictment based on the amnesty agreement—a petition that was successful.[17] The court threw out the three-year attempt to indict Stolt-Nielsen, as it had fully complied with the amnesty agreement they had previously signed.[18]

In 2009 Jacob Stolt-Nielsen stepped down as Chairman, remaining a director of the board. He was succeeded by then Vice-Chairman Christer Olsson, a member of the board since 1993.[19][20] In 2011 the company transported 17.4 million tons in 12,179 parcels for 410 customers, with ships able to transport more than 600 different chemicals.[21] That year the company had also taken the lead in anti-piracy efforts, spending over $1 million per month to protect its ships, with the use of various technologies and armed guards.[22]

In the aftermath of Hurricane Isaac, it was discovered that Stolthaven LLC's terminal in Braithwaite, Louisiana (near New Orleans) terminal leaked thousands of gallons of hazardous material. In addition there were several railroad tankers that were full of hazardous material and left at the plant for the duration of the hurricane. Many of the rail cars were overturned and potentially leaked hazardous material.[23] On 11 September 2012 Stolthaven reported to the Louisiana Department of Environmental Quality that it had potentially leaked 97.3 gallons of benzene, 177,568 gallons of diethylethanolamine, 97.3 gallons of naphthalene, and large amounts of various other hazardous chemicals.[24] The LDEQ immediately launched an investigation to determine the amount of chemicals spilled and to assess the hurricane preparedness of the Braithwaite terminal. The LDEQ fined Stolthaven LLC twice, once for a false reporting of a chemical spill, and second for a lack of preparation for the hurricane.[25][26]

In May 2014, the company made a partnership with the Dutch multinational commodity trading company, Trafigura to develop a new bitumen terminal in the UK. It was announced that the companies have plans to begin operations at the import center from mid-2015 at Stolthaven Terminals’ Dagenham site, east of London. The Dutch trading company are proposing to invest at least £15m over ten years.[27]

In June 2015, Stolt-Nielsen and Golar LNG announced a joint venture to pursue production and distribution opportunities. The firm also made a strategic investment in the Golar, acquiring a 2.3 percent stake.[28]

Operations

Stolt Kittiwake on the way outward from Carrington, UK in 2005

Headquarters

Stolt-Nielsen Limited is registered in Rotterdam. Corporate services are provided from Rotterdam. The parcel tanker and terminal businesses are managed from Rotterdam, and the tank container business is managed from Houston. The aquaculture business is in Spain.[29][30]

Stolt Tankers

The company first started with a single charter tanker, and today the Stolt Tankers division is one of the world's largest parcel tanker companies with a fleet of more than 150 deep-sea, coastal and inland tankers.[29]

Stolthaven Terminals

Stolthaven Terminals operates a global network of 20 owned and joint-venture bulk-liquid terminals with a total of 4.1 million cubic meters of storage capacity. The company’s six wholly owned terminals are located in New Orleans and Houston in the U.S, Santos in Brazil, Singapore, London in the UK and Moerdijk in the Netherlands. Stolthaven has nine majority-owned terminals in Australia and New Zealand, and also participates in five joint-venture operations: Antwerp in Belgium, Westport in Malaysia, Ulsan in South Korea, and Ningbo and Tianjin in China. The company also operates and maintains more than 450 railroad tank cars in North America.[31]

Stolt Tank Containers

Jacob Stolt-Nielsen helped establish United Tank Containers in 1978, starting small with only a few units.[32] The outfit was eventually renamed Stolt Tank Containers (STC). It currently operates the world’s largest fleet of stainless steel ISO tank containers, with more than 31,000 units in service. The fleet is supported by a global network of 24 offices and 15 tank maintenance, repair and cleaning depots in locations worldwide.[31]

Stolt-Nielsen Gas

Stolt-Nielsen Limited entered the market for the transportation of liquefied petroleum gas (LPG) in late 2009. The company purchased the Althea Gas, built in 2003, and the VLGC Yuhsho built in 1999.[33] The company began further integrating the gas business into its business model by the purchase of second-hand liquefied petroleum gas carriers, operating in both the spot and short-term period markets.[34] On 19 November 2010 SNG entered into a partnership with Sungas Holdings Ltd to become equal shareholders in Avance Gas Holding Ltd which was previously wholly owned by SNG. Avance Gas now owns six VLGCs.[31]

Stolt Bitumen Services

Stolt Bitumen Services (SBS) is a new division of Stolt-Nielsen Limited that focuses on distribution of bitumen using bitumen tankers, bitutainers and storage terminals.[31]

Stolt Sea Farm

The company got into commercial-scale aquaculture in 1972. The company first started farming salmon and rainbow trout, deciding that it would be easier than other stocks, such as lobster and sea trout.They began their efforts under the name Sea Farm, so there was no name association to Stolt-Nielsen in its early years.[35] The separate company went public in 1985, which it remained until it was purchased by Stolt-Nielsen in 2006.[36] In 2005 the salmon, trout, halibut, tilapia, cod, sturgeon and caviar operations of Stolt Sea Farm were merged into Marine Harvest. In 2006 the sturgeon and caviar operation was merged back into the Stolt Sea Farm group. Today Stolt Sea Farm is a fish farm producer of turbot, sole, sturgeon and caviar.[31]

References

  1. 1 2 3 4 "2012 Annual Report". Retrieved September 5, 2013.
  2. ↑ Lori Ann LaRocco (2012). Dynasties of the Sea. Marine Money. pp. 1–5.
  3. ↑ Kristian Ilner (2009). Jacob Stolt-Nielsen: an entrepreneur. Vigmostad Bjorke. p. 92–92.
  4. ↑ Ilner, 104-105.
  5. 1 2 Ilner, 111.
  6. ↑ Ilner, 113.
  7. ↑ LaRocco, 5.
  8. ↑ Ilner, 125-127.
  9. ↑ LaRocco, 5
  10. ↑ "Nye rettsrunder for Stolt-Nielsen". E24 (in Norwegian). June 11, 2007. Retrieved 2007-07-13.
  11. ↑ "Court reverses injunction blocking Stolt-Nielsen indictment". MarineLog. March 23, 2006. Retrieved 2008-04-27.
  12. ↑ Anti-Trust Law Blog
  13. ↑ Jerry Frank (February 24, 2006), Stolt-Nielsen sees profit at end of antitrust tunnel, Lloyd's List, retrieved June 16, 2013
  14. ↑ LaRocco, 7
  15. ↑ Corey Boles (December 1, 2007). "Judge Dismisses Indictment Against Shipper Stolt-Nielsen". Wall Street Journal. Retrieved June 14, 2013.
  16. ↑ David Osler (February 29, 2008), Stolt-Nielsen savours a good year, Lloyd's List, retrieved June 16, 2013
  17. ↑ Rajesh Joshi (December 28, 2007), Stolt-Nielsen sees an end to antitrust troubles, Lloyd's List, retrieved June 16, 2013
  18. ↑ Jerry Frank (December 4, 2007), Stolt-Nielsen antitrust case limps to a close, Lloyd's List, retrieved June 16, 2013
  19. ↑ LaRocco, 6
  20. ↑ "Luxembourg. Jacob Stolt-Nielsen to step down as Chairman of Board of Directors", BYM Shipping News, September 2, 2009, retrieved June 14, 2013
  21. ↑ LaRocco, 9
  22. ↑ Gelu Sulugiuc & Giles Broom (January 16, 2011), Danske Bank, Eitzen, Stolt-Nielsen: Nordic Equity Preview, Bloomberg News, retrieved June 14, 2013
  23. ↑ http://www.nola.com/hurricane/index.ssf/2012/09/toxins_found_near_stolthaven_b.html
  24. ↑ http://leanweb.org/our-work/community/hazardous-chemicals-released-from-stolthaven-facility-during-hurricane-isaac
  25. ↑ http://www.deq.louisiana.gov/portal/Portals/0/StolthavenBraithwaite/FAQs-Stolthaven.pdf
  26. ↑ http://www.deq.louisiana.gov/portal/Portals/0/StolthavenBraithwaite/SH%20Floodwater%20Summary%20090612-091212.pdf
  27. ↑ http://www.tradewindsnews.com/tankers/337930/stolts-new-partner
  28. ↑ Reuters (11 June 2015). "Stolt-Nielsen and Golar LNG enter joint venture". Reuters. Retrieved 11 June 2015.
  29. 1 2 Signe Hansen (June 6, 2009), STOLT-NIELSEN: KEEPING A STEADY COURSE, Scan Magazine, retrieved June 14, 2013
  30. ↑ "Business Map". Retrieved September 5, 2013.
  31. 1 2 3 4 5 Jack W. Plunkett (2009). Plunkett's Transportation, Supply Chain and Logistics Industry Almanac 2009: Transportation, Supply Chain and Logistics Industry Market Research, Statistics, Trends and Leading Companies. ISBN 9781593921422. Retrieved June 14, 2013.
  32. ↑ Ilner, 275.
  33. ↑ Martyn Wingrove (November 20, 2009), Stolt-Nielsen adds to gas carrier fleet, Lloyd's List, retrieved June 16, 2013
  34. ↑ Michelle Wiese Bockmann and Andrew Lansdale (October 4, 2010), Stolt-Nielsen still on lookout for LPG vessels, Lloyd's List, retrieved June 16, 2013
  35. ↑ Ilner, 218-219.
  36. ↑ Ilner, 225.
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