The shipowner who trained his sailors to fight pirates with ghost ships

by Andrew Rosthorn

 

In a twenty-first century echo of a 1971 television series about a nineteenth century River Mersey shipping pioneer, the heavy engineering world held its breath in February as a Bremen shipowner pitted his advanced training and technology against the pirates of Somalia - and lost. The world's project engineers now wait for the next episode in the astonishing business career of Niels Stolberg, founder of Beluga Shipping, the River Weser's own Onedin Line.

 

Niels Stolberg founded the Beluga Sea Academy in 2003 to run practical training courses for sailors at sea aboard his combined worldwide fleet of around 67 heavy lift ships. He liked the idea of science-based training for sailors so much that in 2009, just twenty miles downstream from his offices on the River Weser in Bremen, he helped to found the Centre of Maritime Research at Elsfleth, an old Oldenburg town where navigation had been taught since 1832, but where a nautical college was threatened by closure.

This public - private partnership between Stolberg’s firm, Beluga Shipping GmbH, the town of Elsfleth, the Land of Lower Saxony and the Jade University of Applied Sciences of Wilhelmshaven / Oldenburg / Elsfleth, won an award for innovative education in November 2010.

Students of navigation and marine engineering joined scientific researchers and technicians from leading commercial firms studying, working and living near the confluence of the Weser and Hunte rivers on a 30,000 sq m “maritime campus”.

The marine engineering centre opened in 2008 and the maritime research centre opened in 2009, running research into projects like slippery hull surfaces, alternative energy sources, offshore heavy lifting and navigation in the High Arctic.

The best way to match the ever more daring and ruthless activities of Somali pirates in the Indian Ocean was by improved crew training backed by advanced engineering techniques being developed by experts in Germany.

In March 2010, when signing the “Maritime Cluster Bremen” research and training agreement, Stolberg declared his personal intention to improve ship security: “For the field of ship security we see a huge potential in satellite-based services and technologies which can survey the oceans to new standards. This is how we will find answers to the increasing dangers of piracy of which our company in Bremen, and especially our crew, experienced during the hijacking of the heavy-lift carrier BBC Trinidad in 2008.

“Training marine experts efficiently in the area of ship security is more than our main concern. With the local Landkreis Wesermarsch we are building a centre for maritime safety and security in Elsfleth. In 2011 the Beluga Offshore Training Academy will set new benchmarks for maritime education and vocational training in ship safety for heavy-lift cargo and the offshore industry. There will be synergy with the Maritime Cluster Bremen.”

Stolberg argued that the best way to match the ever more daring and ruthless activities of Somali pirates in the Indian Ocean was by improved crew training backed by advanced engineering techniques being developed by experts in Germany.

The new tactics were first tested at 07:08, on Sunday October 24, 2010, when the MV Beluga Fortune, outward bound for South Africa, radioed that she was under attack from pirates 1200 miles off Mombasa in Kenya.

Following their anti-piracy plan the Beluga Task Force contacted Bundeswehr Operational Command Centre and the Operation Atalanta anti-piracy control centre at Northwood in London. Beluga called the German foreign office, the federal and state police forces and the families of the 16 German, Russian and Filipino crew.

With Somali pirates holding 20 hijacked ships and 428 hostages, Stolberg had developed special crew training schemes for “stressful situations” and carried out “frequent rehearsal of pirate attack procedures”.

He revealed, perhaps unwisely, exactly how his crew managed to defend their ship: “We have been training in seminars and workshops for many years. The crew of the Beluga Fortune went through their safety check-list. They notified us of the imminent attack by alarm. They barricaded themselves in the ‘panic room’, which we had installed for just such a purpose. From there they shut down the main engine by cutting off the fuel supply, blocked the bridge controls and radioed their situation to a military “ferret” aircraft. Hence the pirates were unable to take control of the vessel and were stopped from using our seafarers as hostages in a ransom demand. We are very proud of our team on board and very determined in our strategy of investing in safety and security.”

The long-rehearsed plan turned the Beluga Fortune into a ghost ship. Despite the armed pirates in her wheelhouse, she was dead in the water, controlled by an invisible crew protected in a “citadel” by bulletproof steel plates.

When an EU NAVFOR maritime patrol aircraft sighted the ship on October 24, the pirates abandoned ship. Without hostages they could not defend their prize.

Next day, NATO announced a rare victory in the war with the pirates: "A team of Royal Marines from HMS Montrose boarded the vessel this afternoon and released the crew from the safe room. None of them was injured.”

The German Foreign Minister, Guido Westerwelle, announced “a good example of international cooperation in the fight against piracy”.

Niels Stolberg put it all down to technology, training and tactics.


The James Onedin of the River Weser: How American Bankers Seized His Company After Pirates Seized His Ship


The life of Niels Stolberg, born at Brunsbüttel on the Kiel Canal in 1960, reads like something from the 1970 British television series The Onedin Line.

He was a ship’s captain at 24 and a shipowner at 36. By the time he had turned 48, he was president of Beluga Shipping GmbH of Bremen, controlling 72 heavy lift ships on the world’s biggest engineering projects, with offices in São Paulo, Singapore, Beijing and Houston.

He had founded the Beluga School for Life, which aids for tsunami victims and orphans in Thailand, contributed EUR 600,000 to the Jona Project for children with cancer and joined the supervisory board of Werder Bremen FC, four times Bundesliga champions.

The Protestant newspaper Unsere Kirche, noted that Stolberg had recently returned to the church and is fond of a “Chinese” saying that “the work can wait while you show the child the rainbow, but the rainbow won't wait while you do the work.”

An Ernst & Young jury chose him as Germany’s Entrepreneur of the Year in 2006.

But it all started to unravel for Stolberg at 1:38 pm on January 22, 2011, when the captain of MV Beluga Nomination radioed UK Maritime Trade Operations in Dubai. The British radio operator could hear gunfire as the Polish captain reported an attack by a Somali pirate skiff, 390 miles north of the Seychelles and far outside the piracy risk area.

‘It was a disaster’, Stolberg told the Frankfurter Allgemeine: ‘The pirates shot dead one of our men, probably in a fit of anger.’

His crew of Filipinos, Russians and Ukrainians entered the steel citadel and the captain steered the vessel towards the Seychelles, hoping for help from a warship.

This time Beluga’s luck ran out. EU NAVFOR Somalia operational headquarters at Northwood said the nearest EU warship was 1000 miles away and busy escorting a humanitarian aid ship into Somalia.

The trapped crew was held on in the citadel for 72 hours, until the four pirates broke through the citadel roof with a cutting torch and took them prisoner.

On January 25 Stolberg announced, "We are somewhat irritated. Why, within the two and a half days in which the crew hid from the pirates in the citadel, was no external help offered? Were no serviceable units available?"

Worse followed next day when a Seychelles spotter plane found the ship, talked to the captain on short wave radio and photographed a Somali on the bridge.

A Seychelles Coast Guard patrol boat eventually overhauled the Beluga Nomination, opened fire and killed one of the pirates.

‘It was a disaster’, Stolberg told the Frankfurter Allgemeine: ‘The pirates shot dead one of our men, probably in a fit of anger.’

The Philippines government later named the executed sailor as Farolito Vallega, 48.

During the gun battle, the Ukrainian second officer escaped by catapulting himself into the sea aboard the ship’s freefall lifeboat and managed to pick up a Filipino cook, Ferdinand Aquino, 46, who had jumped into the sea.

The Danish warship Esbern Snare rescued them alive two days later. A Russian engineer from St Petersburg seems to have jumped overboard and drowned.

Using a captured gas tanker as a mother ship, the pirates brought the Nomination into Central Somalia, anchored near their stronghold of Harardhere and set her up for ransom, complete with her deck cargo of yachts for the Seychelles and heavy engineering project cargo, destined for Mumbai and South Korea. Nine of the yachts were fast motor cruisers.

Her Polish captain, Ukrainian first officer, Russian second engineer and four Filipino crewmen were still alive but ‘traumatised’, according to Stolberg, and held prisoner aboard a pirate mother ship.

Word spread across Somalia that the pirates had managed to defeat one of the much-vaunted citadels.

Back in Bremen it got even worse for Stolberg. Just after 9:00 a.m. on March 3, two executives from the Los Angeles private equity firm Oaktree Capital Management LP arrived at the Beluga offices on the banks of the River Weser, deep and wide, and went up to Stolberg’s office on the sixth floor.

Soon afterwards, the founder, sole president and CEO of Beluga left the building.

Oaktree, an 82 billion dollar investment firm which had ploughed EUR 200 million into Beluga last July for a 49.5 per cent share in the business, revealed on March 9 that they had called the Bremen public prosecutor.

"In February 2011… Oaktree became aware of significant financial irregularities affecting revenues and liquidity at the Company. Oaktree invested considerable time and effort to prepare a detailed file for the Public Prosecutor.”

On March 9, Stolberg, now facing a fraud investigation by the Bremen prosecutor, told the Weser Kurier: "I accept the procedure and will face any charges that are lodged against me."

Oaktree’s chairman Howard Marks had been interviewed in Berlin before Stolberg walked out and had announced plans to buy more “distressed assets” in Europe.

“The better opportunities lie in Europe because banks have some purification job to do on their portfolios. We indicated to our investors in 2008 that a return before fees of more than 25 percent is possible. Today, you can’t get that level of returns from traditional U.S. distressed debt.”

Oaktree spokeswoman Tina Mentner told Bild Zeitung that Beluga will be restructured financially to “concentrate on its core business, the heavy-lift cargo.”

Interim CEO at Beluga will be Oaktree’s German speaking chief restructuring officer Roger Iliffe, a Briton who heavily re-structured the Crewe railway works for the Bombardier company after a failed management buyout in 2005.

In Somalia, the pirates were asking for an eight million dollar ransom for the Beluga Nomination and her remaining crew.

Tested in the vast Indian Ocean, their daring and cruelty seems to have defeated all the warships of 30 nations and all the training and knowhow so expensively deployed by Niels Stolberg - the James Onedin of the River Weser.

 

 


Photographs: Niels Stolberg - © BELUGA SHIPPING; Royal Marines - © ROYAL NAVY; Beluga Nomination - © BELUGA SHIPPING

 

 

 

 

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