During the month of September 2015, PNSC lifted 913,256 metric tons liquid and 67,380 metric tons Break Bulk/Bulk cargoes. PNSC also provided Slot/NVOCC services and transported 242 TEUS during the month. All the five Dry bulk carriers remained fully employed on trip/voyage/time charter worldwide.

Revenue generation for the month of September 2015 was PKR 860.981 million through freight on lifting of Liquid Cargo, and PKR 191.406 million against freight on lifting of Dry Cargo. In total monthly revenue of PNSC was PKR 1052.387 million.

O U T L O O K

C OMMERCIAL AND FINANCIAL HIGHLIGHT S

Pakistan National Shipping Corporation (PNSC), is a National Flag carrier enjoys a global presence in the shipping world with a fleet of nine (09) ships. It undertakes business operations in an internationally competitive environment, competes even for transportation of national imports and exports and earns most needed foreign exchange for Pakistan.

PNSC fleet is a mix of double hull Aframax tankers, Panamax, Supramax, Handymax and Handysize bulk carriers, all of modern vintage, having a total deadweight carrying capacity 681,806 metric tons. PNSC transports all types of dry and liquid bulk cargoes on several geographical routes covering almost entire world. PNSC undertakes three main functions:

• Fleet Maritime Operations • Real Estate Management of Three Commercial Buildings • Marine Workshop (Repair & Maintenance of ships)

Volume 7 PNSC Monthly Newsletter September - 2015

P A K I S T A N N A T I O N A L S H I P P I N G C O R P O R A T I O N

INSIDE THIS NEWSLETTER Commercial & Financial

Highlights 1

Business Development 1

National Ports and Shipping News 2

Major Events of the Month 3

Quarterly Performance FY 2015-16

3

Global Shipping Updates 4

Business News 4

B U S I N E S S D E V E L O P M E N T During the month, Chairman PNSC met with top management of renowned organizations & exchanged views on mutual cooperation and business development:

• Mr. Imran ul Haque, MD (PSO)

• Faysal Islamic Bank Officials

• JICA Officials

• Economic Team from US Embassy

• MD Maersk

• Senator Islamuddin Sheikh

• Mrs. Riffat Masood (Consul General of Pakistan to Los Angeles)

Chairman PNSC presenting souvenir to JICA officials

Chairman PNSC presiding a meeting with Faysal Islamic Bank

officials regarding loan swap

Chairman PNSC presenting shield to MD Maersk

Celebration of Raising Day at Pakistan Maritime Academy The Pakistan Marine Academy (PMA) celebrated the ‘Raising Day’ for the first time on 3rd September 2015 since its establishment. To celebrate this day, a ceremony was held at the PMA located on Hawke’s Bay Road. Speaking at the ceremony as the chief guest, Honor-able Federal Minister for Ports and Shipping Senator Kamran Michael said that since the inception of the Pakistan Marine Academy, the efforts of the commandants and officers have remained persistent for the development and progress of the academy in the maritime sec-tor. “The Pakistan Marine Academy has contributed significantly to the development of maritime sector of the country,” said Senator Kam-ran Michael, he stated that he is really proud of the Pakistan marine academy because “it offers training to cadets in the fields of nautical and marine engineering and conducts the mandatory seafarers training and certification as well as post-sea specialized courses every year. A souvenir was presented to Senator Kamran Michael by Commodore Akbar Naqi SI(M), Commandant PMA.

Celebration of World Maritime Day World Maritime Day (WMD) was observed internationally during last week of September under the auspices of International Maritime Organization (IMO). This year the day was themed as “Maritime Education and Training”. In context of this, National Centre for Maritime Policy Research (NCMPR), Bahria University celebrated World Maritime Day at Karachi Campus on 21 September 2015. By taking advantage of this important day for creating public awareness, NCMPR organized a Maritime discourse on the theme “Maritime Trade and Economy of Pakistan.” Federal Minister for Ports and Shipping Senator Kamran Micheal graced the occasion as Chief Guest. Mr. Arif Elahi, Chairman PNSC and Mr. Moazzam Khan, Technical Advisor, WWF-Pakistan contributed as key note speakers. Director General NCMPR, Vice Admiral Syed Khawar Ali, HI(M) thanked the worthy sponsors and participants of the event. Prominent dignitaries from trade and industry, stakeholders from maritime sector, naval officers, intellectuals, researchers and students were also present on the occassion. To celebrate the World Maritime Day, Pakistan Navy planned a wide range of activities to acquaint the masses of its significance, raise maritime awareness and highlight Pakistan Navy’s contributions towards sustainable development of Pakistan’s maritime sector. Numerous activities were arranged to highlight the importance of maritime education and training in achievement of better standards of training certification and watch keeping. A number of educational and awareness raising activities including colorful Maritime Gala at Maritime Museum Karachi were arranged.

Page 2

N A T I O N A L P O R T S & S H I P P I N G N E W S PNSC Monthly Newsletter September- 2015

Executive Directors PNSC and other officials of PNSC attending the World Maritime Day Conference

Minister for P&S, Chairman PNSC and DG NCMPR cutting the cake at Bahria University, Karachi.

Minister for Ports & Shipping presenting souvenir to Chairman PNSC at Bahria University, Karachi

Minister for Ports & Shipping Senator Kamran Michael along with Commandant PMA, Chairman KPT and DG Ports & Shipping Karachi on the occasion of Raising Day at Pakistan Marine Academy, Karachi

Defence Day On account of 50th Defence Day of Pakistan, Honorable Federal Minister for Ports & Shipping Senator Kamran Michael along with the Federal Secretary Ports & Shipping Khalid Pervez, Chairman KPT and Commandant Pakistan Maritime Academy visited and laid wreath at Quaid-e-Azam mausoleum on 6th September 2015.

The Honorable Minister for Ports & Shipping presenting souvenir to Commandant PMA

M A J O R E V E N T S O F T H E M O N T H

Fire Extinguishing Drill at PNSC Headoffice

A successful fire-extinguishing drill was conducted at PNSC building on 18th September 2015. Mr. Arif Elahi, Chairman PNSC and Brig (Retd) Rashid Siddiqui, Executive Director Admin, supervised the drill in which 32 fire fighters participated. After evacuation of the people the fire fighter quickly accessed inner parts of the building. During drill, the fire fighters quickly restored the water supply from the basement storage of this building and extinguished the demonstra-tion fire. Ambulances were called to shift the wounded to hospitals. The Chairman PNSC showed profound satisfaction and said that the drill was a success and suggested that such drills should be conducted on quarterly or bi-annual basis so that shortcomings are traced and do away properly. He also said that such drills will help to keep up the moral of PNSC and people’s confidence in the organization.

PNSC Monthly Newsletter September- 2015 Page 3

HAJJ MUBARAK 2015 (1436 AD) In year 2015, PNSC provided full funding support through open balloting program to six employees who proceeded to perform HAJJ. This was in con-tinuation of its commitment to its employees.

HAJJ Scheme 2015 Farewell to Retired Officers

Chairman PNSC presented souvenir to Mr. Kamal Ahmad, GM (Maintenance, Repair & Spares) and Mr. Abdul Latif Chandio, Manager (Dry Cargo Chartering) for their dedication and endeavors for the success and growth of the organiza-tion during their service. Souvenirs were presented in a ceremony held in PNSC Head office on 07th September 2015. A tea party was also arranged in honor of the retired employees. Chairman presenting souvenir to Mr Kamal Ahmad

Q U A R T E R L Y P E R F O R M A N C E F Y 2 0 1 5 - 1 6

The Honorable Chairman PNSC exchanging views with Brig (Retd) Rashid Siddiqui, ED Admin during

fire extinguishing drill at PNSC Head Office

Upon the successful completion of the drill, people are getting back in to the building whereas fire fight-

ers are busy in setting the pipes to release water

People waiting for the drill to finish, evacuation from the building at the start of drill whereas arrangement

of ambulance to move the wounded to hospital

PNSC Monthly Newsletter September- 2015

G L O B A L S H I P P I N G U P D A T E S

Amid a tanker market bonanza, ship owners have been pouring money into new buildings over the course of the past six months. This could be dealt with, thanks to robust demand and increasing ton-mile averages. But, it can become ever so more difficult to avoid a potential oversupply of tonnage, if lower demolition activity remains to be the case. Sales of tanker tonnage for demolition in the MR and larger segments have dwindled since the start of the year, thanks to sustained earnings strength and a collapse of Indian subcontinent demolition prices. Measured by total deadweight capacity, demolition sales activity was down by 77% while the average subcontinent $/ldt price was off by 30% on y/y to $340 as compared with last year. It was noted that low demolition prices also had their impact, the average VLCC unit saw its demolition value drop by $5.6m, or 30%, from a year ago. (Reported in Hellenic Shipping, 28th September 2015)

Tanker Market Could Face Glut of Over Tonnage

Baltic Dry Index Rises 17% in Sept, But Provides Little Reason to Cheer

According to the latest International Maritime Bureau (IMB) incident report, now more than half of the world’s piracy attacks are occurring in South East Asia. Piracy in the Gulf of Aden, which was the scourge of global ship-ping from 2011-14 has all but disappeared. But the problem is far from solved, whilst global piracy has dropped overall in the past few years the start of 2015 has seen a consistent rise in attacks. Responsible for this increase are both the Gulf of Guinea, which remains a hotspot for armed robbery at sea and kidnap for ransom, and south east Asia. Piracy in the waters off Indonesia, the Malacca and Singapore Straits has risen almost exponentially, representing almost 40 per cent of 2015 attacks globally. What is curious therefore, is the lack of response from the regional or international community to address the threat. Unlike Somali piracy, SE Asia has failed to capture the headlines; it has not triggered multi-lateral naval patrols or the proliferation of high-level strategies that we have seen in the Horn, or even in West Africa. (Reported in Hellenic Shipping, 28th September 2015)

South East Asia Piracy

P.N.S.C Building Moulvi Tamizuddin Khan Road, P.O. Box No. 5350, Karachi-Pakistan. Phone : (92-21) 99203980-99 (20 Lines) Fax : (92-21) 99203974, 235636658.

E-mail: communication@pnsc.com.pk URL : http://www.pnsc.com.pk

Page 4

The BDI rose 17.5 per cent during September, sparking speculation that a recovery in commodities could be around the corner. Since Janu-ary this year, the index, a measure of shipping costs for commodities, was up 21 percent. Analysts say the spike was due to an increase in iron ore imports by China. Iron ore prices in that country had risen 28 per cent since July. While some analysts say China was continuing to buy select commodities, the majority view on global commodities trade remains bearish. The index, analysts said it was unlikely to witness any major uptrend in the coming months, owing to a bleak outlook for the demand for commodities from China, the world’s largest im-porter of raw materials. “China is the main driver for dry bulk. But with its economic data indicating a slowdown, we continue to remain negative on BDI and see it move only in a limited range. BDI rises 17% in Sept, but provide little reason to cheer, according to China’s cus-toms administration, the country’s exports declined 6.1 per cent in August in yuan terms, compared to the year ago period. Imports fell even more sharply, by 14.3 percent in yuan terms, compared to 8.1 percent in July. (Reported in Hellenic Shipping, 28th September 2015)

Engro Signs Loan Deal for LNG Terminal The World Bank and Asian Development Bank (ADB) agreed to co-finance the Pakistan’s premier liquefied natural gas (LNG) import termi-

nal of Engro, which has already been built at the total cost $125 million. Engro Elengy Terminal Private Limited signed a loan agreement with the International Finance Corporation, a member of the World Bank Group and ADB for its Elengy terminal at the Port Qasim. The LNG terminal is a first of its type and has been built at a cost of $125 million in a world record time of 332 days. The terminal – which is also one of the most cost-efficient terminals in the region – has the peak capacity for re-gasification of up to 690 mmcfd (million metric cubic feet/day) of LNG. The terminal utilises a floating storage and re-gasification unit (FSRU) provided by US-based Excelerate Energy, and is expected to handle up to 4.5 million tons of LNG every year, which will help to ease the country’s crippling power shortages and reduce its reliance on expensive diesel and heavy fuel oil imports. (Reported in The News, 02nd September 2015)

B U S I N E S S N E W S

China Acquires 809 Hectares of Land in Gwadar China has acquired 809 hectares of land on lease for 43 years in Gwadar. According to UK defence maga-zine, IHS, China has acquired 809 hectares (1999 acres) land from Pakistan on lease for 43 years for construction of first Free Economic Processing Zone (EPZ) in Gawadar port. As per the Port Authority, con-struction of basic infrastructure and EPZ will cost over Rs 3.65 billion. Citing a Chinese journal, the IHS wrote that Gwadar Port Authority (GPA) acquired 607 hectares of land in June and 202 hectares of land will soon be acquired. All the land has been acquired from Pakistan Navy and container depot Balochis-tan. Referring to a statement given by the top economic managers of Pakistan to local media, the jour-nal said more 500 acres of land will be leased out to China for construction of first free EPZ. This way, 2500 acres of land will be given to Chinese companies on lease. China attained the rights for carrying out work on Gwadar port for 40 years in April this year. This port will provide China access to Gulf States. (Reported in The Nation, 10th September 2015)