Daphne Bramham: Polar expedition company faces possibly insurmountable challenges
Credit to Author: Daphne Bramham| Date: Fri, 01 Nov 2019 21:14:08 +0000
When One Ocean Expeditions’ ship Akademik Ioffe went aground in the Arctic in August 2018, it set off a cascading array of problems that has resulted in shipboard staff, non-profit organizations and high-profile speakers not being paid and passengers stranded in Argentina.
It’s likely to get worse Monday when RCGS Resolute — the Squamish-based adventure travel company’s only remaining ship — is scheduled to sail to the Antarctic from Ushuaia.
But that probably won’t happen because the Resolute is tied up in Buenos Aires and OOE can’t pay for fuel. One Ocean has yet to notify those passengers who have paid more than $15,000 US for their trip and are on their way to South America.
“I’m working around the clock to effect a restructuring,” company owner Andrew Prossin said in a brief interview this week. “The last 12 or 14 months haven’t been kind to us and we’ve been working to effect a recovery from the trials and tribulations that have brought us here.
“We are trying hard to live up to our commitments.”
But as the hours tick by, Prossin is realistic enough to know that as OOE’s problems become more widely known, finding a willing investor or buyer becomes more difficult.
Even if he does find a buyer or backer, OOE has created its own trail of grief.
Hundreds of shipboard staff — contractors, not employees — haven’t been paid for months.
In September, eight former staff members and PF Collins Customs Brokers had the ship seized in Halifax. It was the only way that they were able to recoup the tens of thousands of dollars owed to them. Under Canadian law, the Federal Court can order ships held by police to protect financial interests that are involved.
A month earlier, the Resolute was held at anchor off Iqaluit. OOE owed Halifax-based Atship Services $100,000 for provisioning the ship, arranging pilotage services, berthing, fuel and other services. The money was paid within a few hours and the vessel continued on its course.
Kristy Schell disputes the idea that OOE’s payment problems are recent. When she went to work for OOE eight years ago, co-workers warned her that the company rarely paid on time. It took eight months for her to get her money — right about the time she planned to sue.
Still, Schell went back in 2018. Like most of the onboard staff, she went for the adventure. She wanted to see Antarctica and penguins, and because the trip is so expensive, working onboard was the only way she would get there.
Schell is still owed $3,200 in wages and expenses for the contract work she did on the Resolute’s inaugural voyage last October in Central America.
One of Schell’s friends is owed $22,000. Another contractor I spoke to is owed $12,000 — unless she gets the money, she won’t be able to return to school in January. The B.C. native didn’t want her name used because the expedition travel business is a small, close-knit community and she doesn’t want to be blacklisted for speaking out about a former employer.
Others have had to defer mortgage payments or give up their apartments because they can’t pay the rent.
But it’s not just contractors who are on the hook. So is the Royal Canadian Geographical Society.
Its name is branded on One Ocean’s remaining ship, the RCGS Resolute, and it has done co-branded trips with OOE. Its explorers and researchers have also been given free passage by the company.
RCGS CEO John Geiger wouldn’t say how much money is owed to the society. But he emphasized that it has no involvement in the expedition company’s business operations.
“It’s a terrible situation and I feel very badly for those impacted personally,” Geiger said. “We’re very disturbed (that this has happened) and keep hoping they find a solution. The best eventuality for everyone would be to find an investor or buyer and restructure.”
Vancouver-based Ocean Wise (formerly the Vancouver Aquarium) also has a stake in this. OOE staff and passengers collect water samples in both polar regions for its plastics research.
The Vancouver Maritime Museum has an Arctic trip planned with OOE next spring and, in the past, has received sponsorship money from the company for its Arctic programs.
Since One Ocean posted a notice on its Facebook page Tuesday that it was seeking to restructure “after an extremely challenging period of time for our company,” the company has gone silent.
Staff in Squamish were laid off Friday and the office is locked. Voicemail boxes for senior staff are full. But even though a note on the company’s Facebook page says the page is not being monitored, negative comments are being taken down.
It’s an understatement to say that One Ocean is facing extreme challenges.
There were no injuries and the passengers and crew were all safely taken off when the Russian-flagged Akademik Ioffe went aground near Kugarruk, Nunavut on Aug. 24, 2018.
But the ship was damaged and hundreds of passengers booked on the Ioffe for the remainder of the Arctic cruise season were promised refunds or offered the chance to rebook for 2019.
There were investigations. Was it the fault of the Russian captain and crew or the OOE staff, who in consultation with the captain set the course into an uncharted bay where the ship snagged on a rock? More importantly, who would pay the costs?
By last fall, Ioffe was repaired and back in service along with its sister-ship, Akademik Vavilov, and the RCGS Resolute, the company’s new ship that came into service in October.
When the Antarctic season ended in May, the two Russian ships owned by the P.P Shirshov Institute of Oceanography and chartered to OOE by Cyprus-based Terragelida Ship Management were supposed to be go to Spain, where the OOE supplies and equipment were to be offloaded.
Instead, they headed to their home port of Kaliningrad.
Why this happened is the subject of two arbitrations that will be heard in London.
Both OOE and Terragelida are claiming breach of contract — OOE for the loss of the ships and Terragelida for non-payment of debts including the cost of fuel.
Regardless, it left OOE with only one ship and a fully booked Arctic cruise season for three ships.
Australian retirees Di and David Dempsey were among those who had their Arctic trip cancelled. They were promised a refund within 90 days. By Aug. 23, they had not received a penny. Then, OOE promised that they would receive it by the second week in September.
On Oct. 3, in response to their query, they got an email saying that 40 per cent of the clients had received refunds.
It was slim consolation to the Dempseys.
This week after reading about the restructuring, Di said in an email, “I am sure we have no hope of ever seeing our money now.”
Disclosure: I have travelled twice as a guest of One Ocean Expeditions, once to the Arctic and once to Antarctica. My stories were published in The Vancouver Sun and other Postmedia papers as well as online.
Twitter: @bramham_daphne