The provision by logistics majors of project logistics and specialist warehousing and storage services is now a global affair, writes Michael King.

Global forwarders take a variety of approaches to offering out- of-gauge cargo and warehousing services to customers. Take the ever-growing DHL, for example. Although associated in many minds with its express delivery and air freight services, as previously reported in DCI, the company’s interests spread far and wide, even taking in bulk carrier ship chartering and, of course, project logistics.

The company’s Industrial Projects division is one of the fastest growing segments of DHL Global Forwarding, providing specialized solutions to niche project sectors that call for Out of Gauge cargo movements. This can include anything from mining and cement plants through to oil and gas exploration projects or nuclear power plants.

“From entire power generating plants to 1,000-tonne heavy reactor columns, our global Industrial Projects team transports oversized equipment around the world,” said Li Jiang,Vice President and Head of Industrial Projects in the Asia Pacific at DHL Global Forwarding. “We incorporate various kinds of transportation services — either domestic or overseas — by air, ocean, river barge or trucking.”

In India this saw the completion of various projects for the Shanghai Electric Corporation which supplied power equipment to Reliance’s 3,690 MW Sasan Ultra Mega Power Project, a pit head coal based power plant project located in Madhya Pradesh.

DHL provided a raft of services including a project feasibility study, route survey, rehabilitation study, transport design and engineering as well as project Health Safety Security Environment planning. “These solutions resulted in smooth operations and the ability to solve a big cargo loading challenge when one heater reached the maximum weight limit of the ship’s crane,” said Jiang.

The division’s expertise lies in the sound execution of solutions through standardized management, tailor-made operations systems and processes, as well as its experienced personnel and a global network covering over 220 countries. Jiang said DHL was able to use its size to not only negotiate favourable pricing from sub-contractors and suppliers at all stages of the supply chain, but also to source the most qualified companies and personnel from outside the company when required.

“In order to enhance our core competitiveness, we also offer break bulk charter services to establish relationships with subcontractors and lower transportation costs for customers,” he added.

Unlike DHL, which has a sizeable portfolio of owned and rented physical assets, BDP International takes a non-asset based business structure. It believes this enhances the ability of managers to focus on what is the best solution for an individual customer, rather than on the need to utilize its own assets. This has seen the company win a whole raft of major energy projects in the Middle East covering all modes of project transport.

“Our approach is to fully understand what the customer is trying to achieve, then we bring together the different parties to deliver the result,” explained a spokesman. “This makes our approach very flexible and customizable. We hire physical assets for every job we do. But our people are our most important asset — we do not outsource our customer servicing to third parties.

“We need to have great people who are committed to utilising every physical asset available to them to get the best results.”

Agility Logistics was originally established as a Middle East- owned logistics provider and has since expanded its network around the globe, with particular emphasis on the fastest- growing emerging markets. It now offers the full range of logistics services to provide specialist turnkey project solutions on a worldwide basis.

“Our specialty focuses in the sectors of Oil & Gas, Petrochemical, Refinery, Mining, Power, Construction, Marine Agency and Wind & Renewable Power,” explained Grant Wattman, President and CEO of the company’s project team, which is supported globally by over 500 Agility-owned offices in 100 countries with over 20,000 professionals on staff.

When approached by a client regarding a new project, Agility immediately engages with the client to develop a Project Logistics Plan which includes identifying the scope of work, and reviewing the implementation schedule and mobilization plans. Procedures, method statements, KPIs and a comprehensive HSE/QA plan are also developed. “We determine the resources needed and perform risks assessments all to ensure safe and timely deadlines are met,” said Wattman.

While experienced personnel play a major role in Agility’s project logistics offerings, the company also runs assets based in specific regions around the globe. These include trucking services in the Middle East and Asia and, to support the Oil & Gas industry in Asia Pacific, Agility now operates its own daily Tug & Barge service from Singapore to Batam, and manages pipe yards in four countries in SE Asia. “By having our own assets, it allows for creativity in finding effective routes,” said Wattman.

The company also offers a variety of warehousing and distribution services around the world with facilities equipped to handle heavy lift, out-of-gauge and over-dimensional cargoes. In-storage services available take in receiving, put-away, storage, inventory management, picking, packing and shipping, with value- added and distribution capabilities supported by the company’s strong freight forwarding business.

“We operate owned and leased warehouses with a combined space of over 10 million square metres,” explained Wattman. “Agility operates temperature controlled, refrigerated and open area facilities based on the requirements of our customers. Our facilities are strategically located near major ports and airports for ease of reach and equipment access. We provide flexibility in size and type of warehouse, and we are able to utilize an existing facility as well as to set up a new site in an optimal location for our customer.”

Most of the cargo DHL’s Industrial Projects division handles is also usually outsized and/or overweight. The major factor involved in determining the use of storage and warehousing is price.“Warehousing can only be afforded for relatively small cargo pieces within an acceptable price range,” said Jiang.“If we do need warehousing, which is often rented on contract, storage prices and site conditions for transportation and lifting would be of high importance.

“Large cargo would normally be directly lifted and transported from ships to trucks or vice versa, though it may be laid for short storage periods at the lay-down area in ports occasionally.”

He said the challenge was to always deliver cargo in adherence with customers’ requirements as per contract terms. “Our operations team specializes in project technical design and engineering capabilities,” he added. “Our port captains have profound knowledge of cargo lifting, binding, stevedoring, storage, etc. And dedicated HSSE experts ensure a sound environment of health, safety and security.”

While many hazards and obstacles are encountered during major projects, typically these can be divided into two categories: service and the cargo itself. Service-wise, said Jiang, the big risk for any forwarder would be not being able to meet a required transportation time as this would not only create a financial risk, but also delay the whole project and cause tremendous trouble for the customer. “Unfortunately, anything could cause these problems, including a postponement of shipment date or any force majeure factors,” he added.

“On the other hand, risk may lie with the cargo itself. Any inappropriate stevedoring or transportation could cause severe cargo damage, which sometimes can be irreversible. Such hazards, however, exist literally in each and every instance of lifting and shipping.”

Another major furnisher of global project logistics storage and transport services is GAC, which now boasts more the 300 offices globally. The company, according to Per Thornblom, GAC Group Project Logistics Manager, is well covered to handle project logistics at any location, offering a holistic package “rather than simply offering services from ship owners and heavy-lift operators, adding a few dollars and selling to the customer”.

Operating from Gothenburg, due to the benefits derived from being in the same time zone as leading heavy-lift and breakbulk shipping clusters, GAC’s project team serves a wide range of industries including pulp and paper manufacturing, the oil & gas upstream sector, steel mills, power generation, petrochemical, railways and shipping.

“We are constantly exploring ways to perform better than other operators serving the market,” saidThornblom.“For example, can we avoid congestion by choosing other ports than the main ones? Can we reduce costs for the customer by handling the cargo some other way than using ships’ cranes?

“Traditional forwarders ask owners and tonnage operators to issue method statements or cargo manuals. Not GAC.We believe the forwarder must take greater responsibility to be competitive.”

He said all project shipments were now carefully planned using specially-designed software. “Most recently we have invested in advanced CAD [Computer Aided Drawing] technology in order to illustrate how cargoes will be handled on trucks, barges, coasters and on ocean vessels,” he explained. “Our latest investment is in lashings calculation software which calculates the best way to secure cargo on-board a vessel as well as the related acceleration forces to conform with Lloyds and DNV standards.

“Ultimately, it is the vessel’s Master who is responsible for lashings on-board, but by making such calculations ourselves we can help ensure that what is done on-board is correct and in compliance with all the relevant rules and regulations.”

GAC owns and operates warehouses and open yards at numerous different locations globally. “We also own and operate off-shore bases serving the off-shore industry,” he said. “When necessary and appropriate, we also use external contractors to help meet the demands of specific heavy-lifts and other projects.”

He said GAC’s service main selling point in a competitive market was its ability to offer integrated services as part of complete transportation solutions for turnkey projects. “For example, we work closely with the Swedish Metrological and Hydrological Institute to provide a range of weather routing services to aid vessels take the safest and most economical route in light of current or predicted weather conditions,” he said. “We also have a dedicated bunker fuels trading arm, GAC Bunker Fuels, through which customers can purchase bunkers at the best location and price.

“These, and a wide range of other complementary services, can be provided by the GAC Group through a single contact. By controlling as much as possible in-house, GAC is able to stay competitive in the global project logistics industry.”