Giant new ships test limits of risk and reward The huge industrial port of Ponta da Madeira in tropical northern Brazil is far removed geographically and culturally from the picturesque Tuscan island of Giglio. But the two share something important. Both in the past two months have witnessed scenes that illustrate a growing risk facing large swaths of the maritime industry - of large-scale accidents involving members of a new breed of giant ships. IN Shipping Images of the stranded, half-submerged wreck of the Costa Concordia, the 291m-long cruise ship that hit rocks off Giglio on January 13 and capsized, have become familiar round the world and led to calls for tighter cruise ship regulation. The incident left the 3,200 passengers and 1,000 crew scrambling to escape, with at least 17 people dead and another 15 missing. The far less publicised Ponta da Madeira incident could have implications that are almost as far-reaching. In December, as the Vale Beijing, a 361m-long ore carrier with a capacity of 404,389 deadweight tonnes, was being loaded for its maiden voyage, the vessel developed a crack in its hull, sending water pouring in. The vast ship - one of a new class of vessels bigger than any previous dry bulk commodity carrier - had to be towed away for repairs. Both incidents have prompted disquiet about whether the maritime industry has grasped the full implications of introducing the new, far larger ships that have been recently delivered or are on order in nearly every industry segment. Very large cruise liners, container ships and dry bulk carriers account for disproportionate numbers of the ships ordered during the shipping boom before the 2008 financial crisis, many of which are still being delivered. For cruise liners, the main questions are whether the more than 6,000 people on board the biggest can be evacuated fast enough. In container shipping, the imminent arrival of a new breed of 400m-long, 59m-wide container ships carrying 18,000 twenty-foot equivalent units (TEUs) of containers has raised concerns about a serious accident's environmental impact. The Ponta da Madeira incident, meanwhile, also highlights the technical challenges of constructing dry bulk ships to handle stresses of a kind no previous ship has experienced. The vast ships create new risks for operators, according to Phil Anderson, a maritime safety consultant, because a ship's risk level reflects the probability of its having an accident multiplied by any accident's consequences. "Probability doesn't change that much depending on the size of the ship," Mr Anderson says. The consequences certainly would do. Yet Andreas Sohmen-Pao, chief executive of BW Maritime, one of the world's largest shipping groups, points out that passengers or goods can normally be carried far more cheaply on large ships than on smaller ones. "That not only gives you scale efficiencies but it also gives you environmental benefits in fuel savings because you're carrying more on each unit of fuel," he says. The 400,000 deadweight tonnage (dwt) maximum capacity of the Vale Beijing and the 34 other "Valemax" giant ore carriers that Vale, the Brazilian ore miner, has ordered lets the company carry in four voyages the same cargo it carried in five on 320,000 dwt ships, says Paul Slater, a veteran shipping industry financier. "There's a significant economy here," he says. There can even, despite the experience of the Costa Concordia, be safety benefits in large passenger ships, according to Tom Allan, a naval architect and cruise ship safety specialist. Yet, while the stresses on the revolutionary new ships have all been carefully modelled by computer beforehand, there are also bound to be further incidents like the Vale Beijing, where vessels turn out to be more vulnerable in practice than expected. Tor Svensen, chief operating officer of DNV, the ship certification body that issued Vale Beijing's seaworthiness certificates, insists the ship's problems were relatively small and localised in the areas that cracked. But he accepts they are a "wake-up call," reminding engineers to work harder at ensuring all parts of a large vessel are strong enough. There are also questions, according to Andrew Chamberlain, a partner at Holman Fenwick Willan, a London-based law firm, about whether salvage contractors have the tugs, cranes and other equipment to handle the largest potential accidents. Mr Chamberlain last year warned that an accident involving an 18,000 TEU container ship could prove as damaging for the shipping industry's reputation as 2010"s Deepwater Horizon accident in the Gulf of Mexico was for oil exploration. "The salvage industry has said for some years, "We don't have the resources to handle a vessel of that size,"" Mr Chamberlain says. The ultimate brake on ship size, however, may not be safety or technology but the limit to big ships" flexibility. Many maritime analysts point out that the Valemax ships" size means they can serve only a handful of ports worldwide. The largest gas carriers and container ships are also restricted in where they can go. Similar factors have already sent the size of the biggest crude oil tankers - the only major ship class not currently setting size records - falling sharply from the peak reached in 1979 with the 458m-long Seawise Giant, the biggest ship ever built. Mr Sohmen-Pao, whose family have owned crude oil tankers for decades, says the economies of scale were eventually outweighed by the loss of flexibility. "There are places where the port is not big enough or the approach is not big enough," he says. That creates restrictions on where you can trade.