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Tug operators Smit Lamnalco Towage (Australia) Pty Ltd. (SL) and Svitzer Australia (Svitzer) have entered into a three-year tug-outsourcing Service Level Agreement for the Ports of Newcastle, Sydney (Port Botany) and Melbourne.

The deal follows discussions between the two parties with the purpose of seeking to ensure the optimal utilisation of existing towage vessels in each of the relevant ports.

“Under the SLA Svitzer will provide towage services to SL on an arms‐length basis. This will ensure that both Parties are able to continue competing for customers and to carry out harbour towage operations consistent with the requirement s of the relevant ports, with a view to improving the productivity and efficiency in each of the ports and the port‐related supply chain,” SL said in an emailed statement.

Furthermore, Svitzer will also enter into standard Bare Boat Charter Agreements for 6 of SL’s 30 vessels deployed in Australia.

Under the Bare Boat Charter Agreements there are no restrictions on SL redeploying any other vessel in its fleet to any port in Australia, including those ports where Svitzer intends to operate vessels that are the subject of the Bare Boat Agreements and the SLA, the statement said. There is also no restriction on Svitzer deploying the 6 vessels, which have been chartered from SL, anywhere in Australia.