Marine Log July 2017 by Marine Log

arine oG M L www.marinelog.com

R e p o r t i n g o n M a r i n e B u s i n e s s & T e c h n o l o g y s i n c e 18 78

July 2017

SAVAGE'S

BIG PLAY Liquefied Ammonia ATB The Harvest

Q&A with Texas Secretary of State Rolando Pablos

Hybrids Take Market By Storm

FIRST JONES ACT Turbine Installation Jack-Up

We’re saving much more than fuel. BAE Systems’ HybriGen® electric power and propulsion system is saving fuel, emissions, engine hours, and marine life with its patented technology. HybriGen® variable speed gensets provide propulsion and auxiliary power on demand for ferries and service vessels. Ask us how to further improve fuel savings and reduce engine maintenance with HybriDrive® marine solutions.

CS-16-J03

CONTENTS

Departments

Features

2E ditorial A Glimmer of Good News for GoM Shipyards

Hybrids Hybrids Power Up Advances in battery technology coupled with reduced costs has increased interest among vessel operators

LNG Shaking Up the Jones Act U.S.- flag blue water operators are getting a lot greener these days embracing LNG as fuel

Digitalization The Future of Shipping Hundreds of new technologies, products and services were on display at Nor-Shipping 2017—all with a common theme: a push towards increasing automation and digitalization

Maintenance Don’t Let a Date at the Drydock Dry Up Your Bottom Line Drydocking a vessel is both expensive and time consuming but one workboat operator details how groove solutions helped minimize downtime and helped save on costs

4 Industry Insights 6 Marine Innovations 7W ellness Column Don’t Skip on Your Sleep 8 Update

igor’s Historic Launch V Guilty Plea in Tanker Pollution Case • UConn Research Vessel Gets Stretched at Blount Boats •U SS Fitzgerald Suffers Damage in Deadly Collision • •

11 Inside Washington Bipartisan Effort to Achieve 355-Ship Navy 27 Newsmakers

DNV GL Aims to Strengthen its Presence in America

28 Tech News

Complete Cat Power for Z-Drive Tug

Special Supplement Gulf Coast Headliner • Q &A with Texas Secretary of State Rolando Pablos • Investing in Texas Ports • McDermott International Readies Itself for a Market Upturn • Metal Shark Reels in a Big One • Conrad Shipyard Mourns Passing of Founder Parker Conrad

30 Classifieds 32 Marine Salvage Shipping losses fall, but risks remain

July 2017 // Marine Log 1

EDITOR’S COLUMN

MarineLoG JULY 2017 Vol. 122, NO. 7 ISSN 08970491 USPS 576-910 Subscriptions: 800-895-4389 PRESIDENT Arthur J. McGinnis, Jr. amcginnis@sbpub.com PUBLISHER & EDITOR-IN-CHIEF John R. Snyder jsnyder@sbpub.com Associate Publisher Jeff Sutley jsutley@sbpub.com

A Glimmer of Good News for GoM Shipyards

eleaguered American shipyards— particularly those that depend on the oil patch—are thirsty for good news. There was a glimmer last month, when Houston-based rig designer Zentech announced that it was planning to build a Jones Act-compliant offshore wind turbine installation jack-up based on a new design. Building jack-ups is something that is right in the wheelhouse of several U.S. Gulf Coast shipyards, which will have the opportunity to bid on the project. There’s also additional newbuild activity emerging from the government sector, including a new heavy icebreaker and NOAA ocean research vessel. The Zentech project is part of our Gulf Coast Headliner coverage this month, which also includes two exclusive interviews. One is with the Texas Secretary of State, The Honorable Rolando Pablos. The Secretary is a key player in promoting the state’s business-friendly atmosphere. The economy of Texas is not only the envy of many a U.S. state, but also many a country. If Texas was its own country, it would rank as the 10th largest economy in the world, with a 2015 GDP of $1.59 trillion, just behind Brazil and just ahead of Canada. The Lone Star State is no one-hit wonder either. Beyond oil and gas, it boasts global leadership in renewable energy, medicine,

agriculture and manufacturing. Did you know that Texas, for example, is first in the nation in wind power, representing 25% of the total cumulative wind power capacity installed in the U.S.? We also had a chance to sit down with Alan Marriott, McDermott International’s Vice President Fabrication and Marine Assets and Operations, to discuss the company’s ambitions to transform its capabilities in preparation for the upturn in the deepwater oil and gas sector. It wants to be the leader of the pack in Engineering, Procurement, Construction and Installation (EPCI) in the years ahead and Marriott is exploring how the company can add the right pieces to its fleet to do just that. One of the first pieces of the puzzle was the pipelay and construction vessel Amazon, (pictured), which the company snagged in a distress sale from Ceona. Stay tuned for more moves by McDermott International, which recently upped its available credit to grow its capabilities.

John R. Snyder Publisher & Editor jsnyder@sbpub.com

PRICING: Qualified individuals in the marine industry may request a free subscription. For non-qualified subscriptions: Print version, Digital version, Both Print & Digital versions: 1 year, US $98.00; foreign $213.00; foreign, air mail $313.00. 2 years, US $156.00; foreign $270.00; foreign, air mail $470.00. Single Copies are $29.00 each. Subscriptions must be paid in U.S. dollars only. COPYRIGHT © Simmons-Boardman Publishing Corporation 2017. All rights reserved. Contents may not be reproduced without permission. For reprint information contact: PARS International Corp., 102 W 38th St., 6th Floor, New York, N.Y. 10018 Phone (212) 221-9595 Fax (212) 221-9195. For Subscriptions, & address changes, Please call (800) 895-4389, (402) 346-4740, Fax (402) 346-3670, e-mail marinelog@omeda.com or write to: Marine Log Magazine, Simmons-Boardman Publ. Corp, PO Box 3135, Northbrook, IL 60062-3135.

2 Marine Log // July 2017

CONTRIBUTING EDITOR Paul Bartlett paul.bartlett@live.co.uk WEB EDITOR Nicholas Blenkey nblenkey@sbpub.com CREATIVE DIRECTOR Wendy Williams wwilliams@sbpub.com Art Director Nicole Cassano ncassano@sbpub.com Graphic Designer Aleza Leinwand aleinwand@sbpub.com MARKETING DIRECTOR Erica Hayes ehayes@sbpub.com PRODUCTION DIRECTOR Mary Conyers mconyers@sbpub.com INTERNATIONAL SALES DIRECTOR David Cocoracchio davidc@carluca.com SALES REPRESENTATIVE KOREA & CHINA Young-Seoh Chinn corres1@jesmedia.com CLASSIFIED SALES Jeanine Acquart jacquart@sbpub.com CONFERENCE DIRECTOR Michelle M. Zolkos mzolkos@sbpub.com

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EASTERN SHIPBUILDING GROUP, INC.

FULL STEAM AHEAD

We are eager to serve you in 2017 and beyond!

Brian D’Isernia

Founder/Owner & CEO

2200 Nelson Street, Panama City, FL 32401 To add an ESG built vessel 13300 Allanton Road, Panama City, FL 32404 to your fleet, contact us at: www.easternshipbuilding.com Tel: 850-763-1900 ext 3216 Fax: 850-763-7904 Email: sberthold@easternshipbuilding.com www.youtube.com/user/EasternShipbuilding

NEW CONSTRUCTION

•

REPAIRS

•

CONVERSIONS

INDUSTRY INSIGHTS WELCOME TO Industry Insights, Marine Log’s quick snapshot of current trends in the global marine marketplace. As we report on this month, what could be the first U.S.-flag offshore wind turbine installation jack-up is being planned by Zentech and RRI. That’s good news for beleaguered U.S. yards on the Gulf Coast. While the U.S. has only one 30 MW offshore wind farm in operation, other wind farms are in the works, but nothing on the scale of what is happening in Europe, where there is 12,631 MW connected to the grid.

Future of Energy: 2040 How will U.S. meet its demands?

Offshore Rigs Operating in U.S. GOM (on or about June 1 of respective year) OIL

31.9%

ETHANOL, BIODIESEL, ETC.

1.4%

NATURAL GAS

30.4%

COAL

17.6%

2012

2013

2014

HYDROPOWER

8.0% 2.7%

BIOMASS & RENEWABLES

7.7%

OTHERS

0.3%

NUCLEAR POWER

LIQUID FUELS & OTHER PETROLEUM

2015

2016

20 23

2017

33.3%

Source: U.S. EIA

Source: Baker Year

A Closer look at Offshore Wind Number of Offshore Wind Turbines

Offshore Wind, By Country

UK Germany

5,156 MW 4,108 MW

Denmark

1,271 MW

Netherlands

1,118 MW

Others

3,589 (Installed & Connected)

Average Size of Turbines

978 MW

4.8 MW

(Installed Capacity)

Source: Wind Europe

Recent Shipyard Contracts, Launches & Deliveries, North America Qty

Type

Owner

Est. $

Est. Del.

All American Marine, Bellingham, WA

150 PAX Ferry

Kitsap Transit

4.77

2018

Austal USA, Mobile, AL

LCS 28

U.S. Navy

584.2

2022-4Q

Foss Shipyard, Rainier, OR

123 ft Tug

Foss Maritime

2017-2Q

Gladding-Hearn Shipbuilding, Somerset, MA

599 PAX Ferry

Circle Line

2017-2Q

85 ft Patrol Boats

Various (FMS)

St Johns Ship Building, Palatka, FL

4,200 hp tug

Vane Brothers

2017-2Q

Vigor, Seattle, WA

508 ft ATB Ocean Barge

Savage

2017-2Q

Shipyard

Metal Shark, Franklin, LA

Source: Marine Log Shipbuilding Contracts

4 Marine Log // July 2017

54.0

2018-19

Marine Innovations Cobham SATCOM Debuts First SAILOR Terminal for Iridium Certus Cobham SATCOM has unveiled its first Iridium Certus Connected terminal, the SAILOR 4300. The SAILOR 4300 is a Broadband Core Transceiver (BCX) type terminal, offering a reliable link over the Iridium NEXT satellite network with speeds suitable for data-heavy applications including video conferencing, multi-user Internet/VPN, IoT and telemedicine, alongside regular usage such as email, electronic forms/reporting and crew communication. The terminal is designed for seamless integration with onboard communication networks. www.cobham.com

Deep Trekker Launches DT640 Utility Crawler, Innovative Submersible and Magnetic Robot Deep Trekker has launched the first three-wheeled vehicle of its kind, the DT460 Utility Crawler. The submersible is equipped with an HD camera, magnetic wheels and a multitude of application specific add-ons. It can operate at depths of up to 50 meters and houses its onboard batteries, making deployment easy and quick for tasks such as contraband inspections and testing hull integrity or thickness. Its dozer attachment helps remove hard marine growth. The Utility Crawler is also fitted with a pressure washer to remove dirt, debris and rust. www.deeptrekker.com

Dellner Brakes AB New Heavy Duty SKD Disc Brakes Dellner Brakes AB has introduced two new heavy-duty disc brakes to its SKD range. Designed for stopping rotary motion and statically holding load in large marine vessels in industrial machinery, the SKD 140 brake delivers a braking force of up to 258 kN through two brake housings, each containing a powerful hydraulic piston. The SKD 4x140 brake combines two brake assemblies containing a total of four powerful hydraulic pistons to deliver braking force of up to 516 kN. www.dellner-brakes.com

Eniram Introduces SkyLight 2.0 Eniram, a Wärtsilä company, has introduced a major update to its performance monitoring system. The Eniram SkyLight 2.0 brings the systems capability of visualizing a vessel’s route from an economic, environmental and safety perspective to a whole new level. With the addition of nautical maps, weather layers, and route importation, users will be able to switch between updated nautical maps and Google maps within SkyLight’s “fleet” software interface. It also provides the tools needed to reduce fuel consumption. www.eniram.fi

Seakeeper inc. Launches New Model—Providing More Stabilization in a Smaller Package Seakeeper Inc. has released its newest model, the Seakeeper 6. Designed to eliminate up to 95% of boat roll on 40 to 49 ft vessels, up to 20 tons—the Seakeepr 6 condenses more stabilizing force into a smaller volume. The new model’s sphere and internal components have all been redesigned to provide the maximum angular momentum for a given footprint. The Seakeeper 6 also includes an updated electronics suite, including a new touch screen display with NMEA and Ethernet capabilities. www.seakeeper.com 6 Marine Log // July 2017

Wellness Column

Don’t Skip On Your Sleep 2. Bask in the Sun- Unfiltered sunlight exposure produces Vitamin D in the skin, and this is one of the precursors/building blocks for sleep and is great for your heart. It also increases hormone production like testosterone. Additionally, sleeplessness increases your blood pressure. Researchers have found that when sunlight touches our skin, a compound called nitric oxide that helps lower blood pressure, is released into our blood vessels.” Sunlight on your skin can help your blood pressure normalize after a bad night.

leep is not a luxury, but a physiological need to ensure our survival. It allows our bodies to restore physically and mentally. We can go months without food, but in animal models survival was less than 32 days without sleep. We do not know all the reasons why we sleep, however, we do know that it has a profound impact on the neurological system, heart and metabolic health, memory consolidation, immunity, growth and emotional regulation. Popular Science Edition on Sleep – April 2017 reported that those who sleep less than six hours a night have a 13% increased risk of dying suddenly. In 2017, The European Heart Journal also published a report that identified a “48% greater chance of developing or dying from heart disease and a 15% greater chance of developing or dying from a stroke” for those who slept less than six hours a night.

Shutterstock/lenetstan

Understanding How Fatigue Impacts Our Companies The seriousness of fatigue in America and its impact on our safety and health has been quantified as a staggering $400 billion annually (Popular Science-Sleep Edition 2017). This number is operationally difficult to grasp. We like to see how it is impacting our sailors and workers that support our industry. Grabbing a hold of this impact can be difficult, but one way may be to look at fatigue as a causal factor and root cause in our accident investigations. Research studies show that when workers have slept for less than five hours and are awake for more than 16 hours, their chance of making a mistake due to fatigue significantly increases.

Sleep deprivation is similar to that of alcohol overconsumption; one gets to a certain point and they do not recognize their own impairment. Remember, while regulations like STCW may help restrict this issue on ships, those who work as ship’s support, i.e. dock workers, crane operators, etc. do not always have work hour regulations or restrictions governing their time on the job.

Sleep ensures our survival. It allows our bodies to restore physically and mentally. How to Combat Fatigue While companies have a responsibility to understand the impact of sleep on operation and vice versa, individuals need to prioritize sleep as well. If we find ourselves sleepless, there are a few tips to help combat the deficit (although this will not make-up for the long-term health effects of chronic loss). 1. Sleep When You Can- The standard of 7-8 hours a night of sleep has been stated many times based on research and studies. When that’s not possible, sleep as long as you can, and then nap. Even a 10-minute nap can be helpful.

3. Snack Carefully- Eating consciously when tired is critical to managing the weight gain seen in people who are chronically sleep deprived. When sleepless, the hormone Leptin decreases and the hormone Cortisol increases. Leptin brings satiety and stops us from overeating; Cortisol makes you want to eat more. The combination of the two hormonal changes has been shown to put between 11 to 14 lbs of extra weight on the waist line in a year in those getting 6 hours or less of sleep a night. Limit your refined carbohydrates and sugars, which add to the fat around the waist and produce insulin resistance. Eat fats, like nuts, eggs, and fatty fishes, and eat the carbs that help you operate efficiently, rich in nutrients and fiber. 4. The Chemistry of Sleep- Make sure you have the proper nutrients for sleep. Sleep requires building materials like Vitamin D, Tryptophan, Magnesium, Potassium, Calcium and Vitamin K2. Without the building blocks for sleep you will not produce melatonin. This hormone helps you fall asleep. As individuals and companies, we need to understand the choices and priorities we set for health/safety, and the cultures we breed with them. Sleep needs to be prioritized and quantified, so we can truly get a hold of its impact on our own lives and the industry we work in. Nothing in this article constitutes medical advice, it is for educational purposes only. All medical advice should be sought from a medical professional. Emily Reiblein

Crowley Maritime Corporation, Labor Relations-Union Wellness Programs/ Operations Integrity

July 2017 // Marine Log 7

Update Bringing The Harvest to life was a regional effort

VIGOR’S

HISTORIC LAUNCH Vigor has launched the first complex liquefied ammonia transport barge built in the U.S. for the Jones Act Trade since 1982. The Harvest, a 508 ft x 96 ft ATB tank barge, was constructed for The Mosaic Company and will be operated by a subsidiary of Savage Companies as part of an articulated tug and barge (ATB) unit. The 39 ft x 44 ft ATB tug unit was built by Nichols Brothers Boat Builders, Whidbey Island, WA. According to Joe Corvelli, Vigor’s Senior VP, Program, Ocean Tug & Barge Engineering provided The Harvest’s concept design. Glosten completed the functional design and Vigor drove the production design. Built to the highest ABS and U.S. Coast Guard safety standard, The Harvest, was completed on an aggressive time schedule.

To help complete the task, Vigor brought in personnel from its Ketchikan yard; and worked alongside multiple contractors, the designers, and Savage, to plan and manage the project. Vigor also subcontracted JH Kelly, Longview, WA, to provide onboard electrical work, fabrication and installation of the cargo piping systems for the plant. “We’ve worked hard to bring together a family of companies designed to take our complex fabrication and capabilities to the next level and bring new work to the Pacific Northwest,” says Vigor CEO, Frank Foti. “ The 23-month long project supported approximately 1,500 American jobs and involved close to a million labor hours at Vigor shipyards in Oregon and Washington, and subcontractors throughout the Pacific Northwest region.

Guilty Plea in Tanker Pollution Case Thome Ship Management and Egyptian Tanker Company have pleaded guilty to violating the Act to Prevent Pollution from Ships (APPS) and obstruction of justice. The two companies entered the plea and admitted to presenting false documents to the U.S. Coast Guard, covering up the illegal dumping of oil-contaminated bilge water and garbage into the sea from the 107,181 dwt Liberian-flagged tanker ETC Mena. Crew members bypassed the ships oily water separator and discharged water into the ocean in March 2016. The government’s investigation also revealed that crew members were instructed to throw plastic garbage 8 Marine Log // July 2017

bags filled with metal and incinerator ash into the sea. Neither was entered into the ship’s Oil Record Book and Garbage Record Book in violation of APPS. Under the plea agreement, the two will pay a $1.9 million penalty and provide marine and coastal restoration help at three national Wildlife Refuges located in East Texas on the Gulf of Mexico. The two companies have also been placed on a four-year probation, which includes a plan to help ensure that all U.S. bound ships operated by Thome Ship Management are fully compliant with marine environmental protection requirements.

BIZ NOTES Petrobras settles suit The Board of Directors of Brazil’s state-run oil company, Petrobras, h a s a p p r ove d a n a g r e e m e n t to set tle a shareholder lawsuit brought by The Vanguard Group in U.S. Federal Court. The group is one of Petrobras’ largest shareholders after the Brazilian government and affiliated entities. The lawsuit stems from alleged violations of federal securities laws for purportedly concealing a multi-year, multi-billion-dollar bribery and kickback scheme. The terms of the settlement with The Vanguard Group are confidential. T hi s i s n’t t h e f i r s t l a w s u i t Petrobras has had to set tle in recent months. The oil giant says it previously entered into agreement s to set tle 19 individual lawsuits brought before the U.S. Federal Distric t Cour t in New York. Including those 19 lawsuits, a total of 27 individual lawsuits have been consolidated, for judgement, together with a class action brought before the U.S. Federal District Court in New York. The Vanguard lawsuit was the only one filed out side New York, in Pennsylvania.

Update

UConn Research Vessel Gets Stretched at Blount Boats The University of Connecticut’s

(UConn)research vessel R/V Connecticut is undergoing a midbody conversion and refit at Blount Boats’ shipyard in Warren, RI. For the midbody conversion, Blount Boats had to cut the 26-foot-wide research vessel in half and insert a 14-foot-long “plug” to stretch the vessel from 76 to 90 feet in length. The longer vessel will allow the laboratory space on board the vessel to double in size, and increase accommodation spaces. Once completed this month, the Connecticut will be able to sleep up to 18 and have a capacity for 13 researchers and technicians. Elliott Bay Design Group (EBDG), Seattle, WA, which produced the original contract design for the vessel back in 199495, was contacted to conduct a feasibility study for the conversion project. “We produced a report addressing the impacts on various aspects of the vessel including Regulatory, Arrangements, Machinery, HVAC, Electrical, Structural, and Stability,” says EBDG Project Manager David Turner. “This report was intended to enable UConn to make a determination as to whether to proceed (on the conversion).” The conversion has posed some challenges, says Blount Boats Vice President Bob

Pelletier. “The hardest part was the cribbing, cutting, and rolling away of the 40-long ton aft section from the 92-long ton forward section,” says Pelletier. The R/V Connecticut is now back together. Blount Boats used laser and water leveling devices to set the aft section, and the steel midbody section—lofted by shipyard Project Engineer Luther Blount—has “fit up rather nicely,” says Pelletier. Turner says that while the two main drivers behind the lengthening were expanded lab and accommodation space, the conversion will yield other benefits. “Tankage in the vessel also had to be modified to allow for operation in zero discharge zones, even with the increased crew capacity. Another concern was the effect lengthening the vessel could have upon the dynamic positioning capability, and in conjunction with this EBDG looked at ways of increasing the stern thruster performance.” Adds Turner, “When designing new vessels, EBDG often does so with consideration for a possible future lengthening. This can be accomplished by including a short length of constant section midbody and also a bit of advance planning with scantlings and systems installations.

The R/V Connecticut was not designed with a future lengthening in mind, yet on completion of the study the conclusion was that lengthening was eminently feasible and would provide substantial benefits to UConn’s marine sciences operations.” Over the course of its life, the R/V Connecticut has been used not only by UConn marine science researchers, but also government agencies such as the U.S. Navy, NOAA and U.S. Geological Survey. The conversion is expected to increase the vessel’s value as an educational and scientific research platform.

USS Fitzgerald Suffers Damage in Collision Last month , the Arleigh Burke Class Destroyer USS Fitzgerald (DDG 62) was involved in a collision with the 222.6 m Philippine-flagged containership ACX Crystal 56 nautical miles southwest of Yokosuka, Japan. The 154 m USS Fitzgerald took a direct hit on its starboard side with significant impact under the ship’s pilothouse and a large puncture below the ship’s waterline. In total, seven sailors onboard the U.S. Navy ship were killed. Meanwhile, the ACX Crystal experienced only minor damage to the bow, with no injuries reported. According to U.S. 7th Fleet Commander Vice Admiral Joseph Aucoin, the damage

suffered by the USS Fitzgerald led to rapid flooding in three large compartments— including one machinery room and two berthing areas for the crew of 116. It was the crew’s rapid and heroic response that prevented the flooding from spreading into other compartments—enabling the ship to remain upright, afloat and preventing further loss of life. While investigations are ongoing, its believed that the crew onboard the ACX Crystal was initially unaware they hit the warship. It was only after they turned around and went back to the collision site (an hour later) that they witnessed the aftermath of the collision. Investigators believe

the container ship was on autopilot when the collision happened. NYK Line, which is chartering the ship, is fully cooperating in the investigation being led by the Japanese Coast Guard.

MARITIME Trivia– Question #50: In the early days of sail, what member of the crew was addressed as “doctor”? The first sailor or lubber that correctly answers the Maritime Trivia question will receive a J. Clary collector print. Email your guess to marineart@jclary.com. June’s trivia question: How did signal cannons help celebrate the completion of the Erie Canal? Answer: Signal cannons placed every few miles from Buffalo to Manhattan sent a series of blasts that boomed a thousand miles in less than three hours. Submitted by Chance Aucoin, School of Naval Architecture and Marine Engineering, UNO.

July 2017 // Marine Log 9

Update

New Vane Brothers Tug Christened St. Johns Ship Building , Palatka,

BC Ferries Continues With Fleet Upgrades BC Ferries’ plans to add LNG power to its fleet are coming to fruition. The latest addition to its new class of vessels, the Salish Class, is the Salish Raven, the third of three dual fuel ferries for BC Ferries that will have the ability to burn Liquefied Natural Gas (LNG) as a fuel. The ferry was delivered from Remontowa Shipbuilding S.A., Gdansk, Poland. Like its sister vessels, the Salish Orca and the Salish Eagle, the Salish Raven is 107 meters long, with the capacity to transport 145 vehicles and up to 600 passengers and crew, at a maximum speed of 15.5 knots. The 8,278-gt ferry is powered by three Wärtsilä 8L20DF engines. The three vessels are part of a large capital investment plan by BC Ferries to upgrade its fleet and retire aging tonnage. BC Ferries contracted Remontowa Shipbuilding to

build the three LNG-fueled ferries at a cost of C$165 million in July 2014. The new vessels will allow the retirement of the Queen of Burnaby and the Queen of Nanaimo. After its arrival on June 7, the Salish Raven sailed to BC Ferries’ refit facility in Richmond to prepare for service in the Southern Gulf Islands this coming fall. BC Ferries also has plans to perform midlife upgrades to the 1990s-built Spirit of British Columbia and Spirit of Vancouver Island. The upgrades, which will allow the ferries to burn LNG, will be completed spring 2018 and spring 2019, respectively. BC Ferries has a fleet of 34 vessels, carrying about 20.7 million passengers and 8.1 million vehicles in fiscal year 2016. The figures represent a 4.5% increase in passenger traffic and 4.9% increase in vehicle traffic as compared with fiscal year 2015.

FL, has christened the newest tug for Vane Brothers. The New York is the sixth vessel in a series of eight 4,200 hp model-bow tugs being built by St. Johns for Vane brothers. The tug is expected to be delivered later this summer. The New York is an Elizabeth Anne Class vessel. The vessel measures 96 ft long and 34 ft wide, with a depth of 14.4 ft and is powered by two Caterpillar 3516B Tier 3 engines, each generating 2,100 hp at 1,600 rev/min, and John Deere Tier 3 auxiliary engines. St. Johns Ship Building Human Resources Manager, Carla Newkirk, christened the tug. While its headquartered in Baltimore, MD, Vane Brothers also conducts operations in Brooklyn, NY and other locations along the U.S. East Coast. More than 50 Vane Brothers tugboats provide towing petroleum operations in the North Atlantic coastwise trade.

Designed for:

Heavy Duty Naval Architecture Marine Engineering Salvage Engineering Marine Surveys

JMS-Designed.

Stevedoring barge 300’ x 72’ · 6,000 psf deck Built by Conrad Shipyard for the Rhode Island Commerce Corp. and Port of Providence

10 Marine Log // July 2017

www.JMSnet.com 860.536.0009 Barges, Dry Docks, & Work Boat Design

inside washington

Bipartisan Effort to Achieve 355-Ship Navy

hen Democrats and Republicans in Congress come together, it is a story in and of itself. That’s why it’s good news for the maritime industry that both sides of the aisle are throwing their collective efforts behind “Securing the Homeland by Increasing our Power on the Seas (SHIPS) Act,” legislation aimed at building the U.S. Navy’s battle force up to 355 ships. It currently stands at 276 ships. Senator Roger Wicker, R-MS, and Congressman Rob Wittman, R-VA,

serve as Chairmen of the Senate and House subcommittees that oversee the Navy and Marine Corps. “My objective as Seapower chairman in this year’s NDAA is to send a strong signal that we intend to grow our fleet to 355 ships,” Wittman said. “I believe industry is ready to ramp up production to get us there and Congress must do its part and provide the necessary funding for shipbuilding accounts so we get on the proper glide path to 355. This bill, which I am pleased to have worked on with my counterpart Senator Roger Wicker, sends that strong signal as we head into NDAA markup. A fleet of 355 ships will allow us to deter our adversaries, support our allies, and respond to threats and humanitarian challenges around the globe.” The legislation mirrors the Navy’s recent force-structure assessment that said it needed 355 ships to meet

the demands on its forces. Senator Wicker added that a better maintained fleet could also help the Navy reach the 355-ship goal since “the Navy is smaller, but the tempo of its operations has accelerated. An extra month of deployment puts wear and tear on ships. This could ultimately force early retirement and squander taxpayer dollars.” He mentioned other options such as bringing “some Oliver Hazard Perry Class frigates out of mothballs to grow the fleet” as well as developing and deploying unmanned systems. “The fleet of the future will include new types of ships,” said Wicker. According to the CNO, unmanned systems must also be an integral part of the future fleet. I am hopeful that Congress will provide the resources to rapidly develop and deploy new unmanned systems. We should consider all options to build up our Navy.”

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July 2017 // 6/22/17 Marine4:52 LogPM 11

A CRUISE SHIP THAT MOVES T H OF PASSENGE R And a large-scale project where we were on Why does the world-renowned Meyer Werft shipyard team up with Viega time and again for numerous projects of this scale? In addition to the extremely reliable piping systems made from copper, copper alloys or plastic materials, Viega also supplies the know-how to go with them. Viega. Connected in quality.

Meyer Werft shipyard, Papenburg, Germany

viega.us/About-us

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HYBRIDS Feature

hybrids POWER UP Technological advances increase interest in hybrid propulsion By John R. Snyder, Publisher & Editor in Chief

step change is underway in hybrid marine power and propulsion system applications. Rapid advances in battery technologies—and significant reductions in cost—have caught the attention of vessel operators. Just a few short years ago, for example, it would have been unthinkable to consider hybrid propulsion for a 17,500 dwt IMO Class II chemical tanker. Earlier this year, however, it became a reality when Norway’s Rederiet Stenersen AS choose Corvus Energy’s Orca Energy ESS solution to integrate with WE Tech Solutions’ Direct Drive Permanent Magnet Shaft Generator solution. Halvard Hauso, Senior Vice President Business Development, Corvus Energy, says the application proves the “viability for energy storage for the hybridization of longer-haul vessels. As the cost of lithium ion batteries continues to improve we will see more and more applications beyond the traditional ferry and tug base.” While hybrid propulsion applications have begun to branch out into more and more ship types in Europe, the U.S. has just begun to scratch the surface of applications for tugs, water taxis, ferries and research vessels. Building on the early efforts of pioneers Bob Bekoff, Foss Maritime and Hornblower, other operators are realizing the advantages of hybrid propulsion. Just last month, the Kitsap Transit Board in Kitsap County, Washington, gave the go ahead to proceed to contract for a new hybrid-powered catamaran ferry from All American Marine, Bellingham, WA. So why go hybrid? “Our board selected a hybrid vessel to reduce emissions and sound because the vessel will operate exclusively in Sinclair Inlet, which is surrounded by residents and businesses,” says Kitsap Transit spokesperson Sanjay Bhatt. “Hybrid vessel technology, specifically the batteries, has advanced significantly over the past 5 years,” says Kitsap Transit Marine Service Director Casey Harrington. “The application on our hybrid vessel is optimized for the vessel’s service parameters: time equally distributed between mediumspeed transit and passenger handling at the

terminal. The hybrid design will deliver a measureable reduction of both fuel cost and emissions of greenhouse gasses and particulate pollutants, key initiatives at Kitsap Transit.” Designed by Seattle-based naval architecture and marine engineering consultancy Glosten, the 70 ft x 26 ft, 150-passenger-only ferry will be fitted with two Cummins QSL9 diesel generators, one in each hull, with an expected service speed of 16 knots. Two BAE Systems HybriDrive propulsion systems will drive fixed-pitch propellers. Glosten Project Manager and Design Lead William Moon, PE, says that besides reduced emissions and fuel consumption, Kitsap Transit will also benefit from lower maintenance costs because the engine running hours are minimized. “The engines can be shutoff when the boat is at the dock,” he says. “And from a passenger standpoint, this boat will be super quiet.” The new hybrid electric passenger ferry is the first in Puget Sound. All American Marine (AAM) was the low bidder to construct the hybrid ferry for $4.77 million. Other shipyards competing for the contract were Derecktor Shipyards, Mamaroneck, NY, Safe Boats International,

Bremerton, and Vigor, Seattle, WA. It is expected to be delivered in 2018 and carry over 350,000 passengers annually. “Early on, I think there was some ‘hybrid hype’,” says AAM’s Joe Hudspeth, “but now it has developed into a true viable solution.” AAM has been the beneficiary of increased interest in hybrid vessels, says Hudspeth. Earlier this year, it won a contract to build a 600-passenger aluminum monohull passenger vessel Enhyrda for San Francisco’s Red and White Fleet. AAM partnered with BAE Systems to design and integrate the complete battery electric hybrid system. That includes supplying a HybriDrive Propulsion System with a generator, control system, and AC electric traction motor. The generator will mount to a variable speed Cummins QSL9 diesel engine developing 410 hp at 2,100 rev/min. Another benefit of hybrid propulsion is “push button” start and the availability of full acceleration. The motor generator offers diesel-electric operation of the AC traction motor, which is coupled directly to the propulsion shaft. With this configuration, torque is immediately available for the propeller and the speed can be precisely controlled without

A rendering of the Kitsap Transit Board’s new hybrid ferry

July 2017 // Marine Log 15

HYBRIDS the need for a reduction gear. The hybrid system will also incorporate battery power from two 80 kWh Lithiumion battery packs with Corvus Energy’s next generation Orca Energy batteries. Delivery is set for the spring of 2018.

Boats for CUNY, Harbor Harvest As we highlighted in our May 2017 issue (ML, May 2017, p. 32, “Humming Along”), The Science and Resilience Institute at Jamaica Bay, led by City University of New York’s Brooklyn College, has taken delivery of CUNY I, a new 65 ft long hybrid research vessel built by Derecktor Shipyard, Mamaroneck, NY. Derecktor Shipyard has already begun construction of its third hybrid vessel based on the same Incat Crowther designed aluminum catamaran hull. Plans for the new boat were revealed this past May at the Marine Log Tugs

& Barges 2017 Conference & Expo in Stamford, CT. Panelists Bob Kunkel, President of AMTECH as well as co-owner of Harbor Harvest (he knows how to butcher meat, too), Micah Tucker, General Manager of Derecktor Shipyard, and David Adamiak, BAE Systems HybriDrive provided details on the first of what could be a fleet of 12 organic market cargo delivery vessels. Kunkel, who has one of the most interesting bios you could ever read, discussed the development of an emissions-free waterborne transportation that would use a fleet of hybrid boats to deliver fresh farm products across Long Island Sound and down the Hudson River. One of the first stores to benefit from the “special delivery” would be Kunkel’s own Harbor Harvest organic store and deli in East Norwalk, CT. He’s already received requests from four Connecticut stores and

three Long Island Villages to open food hubs at their waterfronts. Designated as part of the Marine Highways Program, the Harbor Harvest vessel would be able to carry 12 metric tons of cargo (five metric tons of which would be refrigerated), picking up fresh farm and dairy products, meats and produce from farmer’s markets located near the water along the Sound. Kunkel says the route has already been proven and it would do what the Marine Highways Program was designed to do— take trucks off the road. In addition, the boat, once again using the BAE Systems HybriDrive propulsion and Corvus energy storage systems, would be able to operate for three hours without a recharge. Charging stations will also be located along the vessel’s trade route, which would provide zero emissions operation.

Torqeedo’s Plan to Electrify the Commercial Market

The leader in electric boat drives is quietly making moves. That was driven home earlier this year when Torqeedo Group hired Marcia Kull as its President. For years, Kull had been in the highly visible role of Vice President of Marine Sales at Volvo Penta Americas, where she lead the diesel engine manufacturer’s commercial and recreational sales effor ts in Nor th America. In her new role, Kull will be responsible for directing global sales and strategy for the electric marine propulsion provider. Torqeedo is a relatively young company. It was founded in 2005 but has already made a name for itself in the electric marine propulsion sector. Its lineup of products includes outboards, inboards, hybrid drives, batteries and sail drives. Its popular Deep Blue brand is of fered in outboard, inboard and hybrid drive models, with a power range of up to 80 hp equivalent. And its expanding its batter y development through a technical partnership with BMW.

16 Marine Log // July 2017

So what attracted Kull to Torqeedo? As she puts it “Endless opportunities for innovation and growth.” Kull explains that electric mobility is increasing in popularity both on the recreational and commercial side. “As people are making their own environmental choices,” on how to operate their businesses, their fleet, “electric propulsion is clearly the way forward.” Electric propulsion has a multitude of advantages, according to Kull. It is far more efficient than spark and compression ignition engines—“You can be a smaller electric motor, and yet, get the same per formance…You also have all this power at really low rev/min. You get quiet operation, an absence of vibration, no exhaust or smells. “For an owner/operator the significant reduction in total cost of service will be the most telling,” Kull says. “Over the course of operation, we know the propulsion capital cost is dwarfed by the cost of fuel, lubricants, and maintenance over the useful life of a system. And that’s where an electrical system has a significant advantage. It’s immune to fuel prices. It never needs oil, and there are fewer moving parts that need to be removed or replaced.” Torqeedo’s lineup of products can be used in a variety of applications, including water taxis, riverboat cruises, and “heav y-dut y work.” That heav y-dut y work includes the use of an 80 hp Deep Blue inboard with a Schot tel drive,

batteries and chargers, on a 44 m hopper barge. The large gravel excavation barge is working in a quarry in Germany. Torqeedo also powered Europe’s first electric water taxi for Watertaxi Rotterdam. The boat is equipped with a Deep Blue inboard 80 hp and two DC generators. The combination makes the vessel 70% more fuel-efficient than the other vessels in the fleet. O n t h e r i ve r b o a t f r o n t , t w o of Torqeedo’s 80 hp equivalent Deep Blue Outboard drives are fitted onto The Queen Elizabeth Dr., along with independent battery banks. The 75 ft, 100% electric vessel, built for Ottawa Boat Cruise’s Rideau Canal Cruises, is the only one of its kind in North America. And soon, Torqeedo will power 44 river barges being built by Lake Assault Boats for the River Walk in San Antonio, TX. The boats, which will be delivered this fall, will be driven by a Torqeedo 10kW outboard elec tric motor with power supplied by batteries. The system will enable the boats to operate a 15-hour day before recharging. Innovation will continue to be the way for the company. A s Kull tells Marine Log, Torqeedo invests 100% of its R&D funds into actual R&D, ensuring that innovation and new product development is consis tently taking place— guaranteeing that Torqeedo’s future will be filled with, Kull exclaims, “Lots of growth!”

July 2017

Gulf Coast Headliner

Reporting on marine business in the U.S. GULF COAST

MCDERMOTT ADDS SUBSEA MUSCLE Pipelay and construction vessel Amazon

Q&A with Texas Secretary of State Rolando Pablos

Investing in Texas Ports

Metal Shark reels in a big one

Gulf Coast Headliner

Gateway to Success Texas Ports are critical to international trade and provide multiple economic opportunities

exas ports play a critical role in the state’s transportation system and are a key part of the state’s economy, according to the Texas Department of Transportation. And their reach goes beyond the state level. Texas ports supported a total of 5.1 million jobs nationwide in 2015 and created $1.2 trillion dollars of economic activity in the U.S., according to an economic impact study conducted b y Ma r t i n As s o c i a te s f o r t h e Te x a s Ports Association. According to the state’s Port Authority Advisory Committee 1,561,870 jobs in the state are supported by port maritime activity; ports generate $368.7 billion of total economic value supported in the state (23% of the state GDP); they produce $92.2 billion in total personal income and local consumption; and create over $6.9 billion in state and local taxes. That impact is expected to grow as the expansion of the Panama Canal will lead to larger ships entering Texas ports, the lifting of the ban on exporting crude oil will lead to more opportunities, and investments in LNG terminals/infrastructure across the state will produce in demand commodities. With 11 deepwater ports and 16 seaports, Texas has the most U.S. ports of

entry in the country and is the nation’s top exporter with exports valued at over $248 billion in 2015. Among its stellar performers are the Port of Houston, Port of Brownsville, Port of Corpus Christi and the Port of Galveston. The Port of Houston, the state’s largest port, touts itself as “The International Port of Texas” and with good reason. The 25-mile long complex is comprised of 150 plus private and public industrial terminals along the Houston Ship Channel. The port is also home to a multi-billion petrochemical complex—the largest in the U.S. and second largest in the world. It ranks first in foreign waterborne tonnage, import, export tonnage and break bulk. And handles about 70% of all containerized cargo in the U.S. The Port of Brownsville, otherwise known as “The Port That Works” is connected to the Gulf of Mexico via a 17-mile long ship channel and with 40,000 acres of property is the largest land-owning public port authority in the nation. The port is the nation’s leader is ship recycling, and its on premises shipyard offers construction and refurbishment services. The port is also Foreign Trade Zone No. 62 and consistently ranks in the top three U.S. FTZs for

exports. According to the Port of Brownsville, its FTZ is one of the largest in the U.S. and in 2015 exported commodities valued at $3.6 billion, and imported commodities valued at $3.2 billion. Texas is oil country. According to the Port Authority, oil and gas development in the state has contributed to more than $300 million in the state’s economy. Recent key projects from private investors include the Golden Pass LNG Expansion; the Freeport LNG Expansion; the Cheniere LNG (Corpus Christi), Dow Chemical Expansion, Freeport; and ExxonMobil Expansion, Baytown. The Port of Corpus Christi is smack dab in the middle of the oil and gas action. Calling itself the “Energy Port the Americas,” the port is the largest exporter of U.S. produced crude oil in the nation. Its also the nation’s 4th largest in total tonnage. Earlier this year the port’s Oxy Ingleside Energy Center (OIEC) export terminal accepted the arrival of Euronav’s VLCC Anne. The 1,093 ft very large crude carrier is the largest oil tanker to call on a Gulf of Mexico (GoM) port. The port also set a single vessel load record this past April when 930,000 barrels of crude oil was loaded to the Suezmax class Cap Romuald. If there’s one market that’s currently hot everywhere it’s cruise shipping. The oldest port in the GoM, the Port of Galveston, is making a name for itself in the market, currently ranking as the 4th busiest cruise port in the U.S. In 2015, 1.76 million cruise passengers made their way through the port, and those numbers are expected to rise. According to the Port Authority, Texas ports have, in the last few years, seen cruise traffic increase substantially—from 2013 to 2014 cruise passenger numbers have increased by nearly 14%, more than double the rate at which the state of Florida (number one in the nation in terms of cruise passengers served) is growing. The Port of Galveston recently hosted a sneak peak of its renovated Cruise Terminal 2. The expansion, which is expected to help the port meet increased passenger demands, included an increase in space from 90,000 square feet to 150,000 square feet, seating from 500 to 2,000 and the addition of more check-in booths. Currently, Carnival Cruise Lines, Disney Cruise Line and Royal Caribbean call at the port. July 2017 // Marine Log S3

Gulf Coast Headliner

The Theo T exports the first shipment of crude oil from the Port of Corpus Christi after the ban was lifted

Diversification and Market Development To remain among the top producers in the country, Texas ports will need to invest in infrastructure and improvements to ensure business continues to grow. And as we’ll come to learn, even Texas ports aren’t immune to problems. For instance, ports in the state are losing market share in waterborne trade at a higher rate than on the national level.

S4 Marine Log // July 2017

One source of the problem, according to the Port Authority, is the increase in domestic oil production—with production on the up and up, there’s less of a need to import foreign oil. Signs also point to a losing battle with other modes of trade—including rail and truck. As more manufacturing work is taking place in Mexico, goods can be imported via truck, rendering waterborne trade obsolete (at least in this scenario). Mexico isn’t the only country changing

ports’ modus operandi. While several U.S. ports trade with China—the country’s largest trading partner—ports in Texas are unique in that they primarily trade with South American countries such as Venezuela and Brazil. In fact, the two countries combined represent 50% of the waterborne trade in Texas according to the Port Authority Advisory Committee’s Texas Ports Strategic Mission Plan-85th Legislative Session. However, a decline in trade with its South American trading partners will require Texas ports to diversify and increase its trade partnerships with China and Asian companies. “To offset the decline in trade with South American countries such as Venezuela and Brazil, it should be a goal of Texas ports to increase trade with China and the Asian economies,” suggests the report. A likely way of doing that is using the recent expansion of the Panama Canal to its advantage. The $5.25 billion expansion project is expected to boost the economies of ports along the eastern seaboard of the U.S. as well as ports along the Gulf Coast. But is Texas ready for an influx of

Neo-Panamax vessels? Not exactly. As they stand today, most Texas ports currently can’t take on the larger ships the expanded Canal was built to let through. And although ports such as Houston, Brownsville, and Corpus Christi have received approval to dig deeper channels, the funding for projects is not in place to see expansion happen on a larger, broader scale across all Texas ports.

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In order to make way for larger ships, dredging, expansion in infrastructure, and investments in larger terminals must take place—and that is perhaps the greatest irony in Texas ports’ success story. Texas is the only coastal state that doesn’t provide financial aid or funds to ports on the state level—and doesn’t have a program in place to address port infrastructure. Port authorities and state agencies help by providing partial funding. And with ports in neighboring states such as Louisiana already improving infrastructure and increasing port depths, Texas runs a real risk of losing major business opportunities. But there may be some relief on the way. Senate Bill 28 (SB 28), the Texas Port Expansion Act, was recently signed into law by Texas Governor Gregory Abbott. The law, spearheaded by Senator Brandon Creighton (R-Conroe), would provide assistance with financing ports in Texas. “Texas ports serve as gateways to the state economy—creating nearly 1.6 million jobs for Texans,” said Lt. Governor of Texas, Dan Patrick. “In order for Texas to remain the number one exporting state we must continue to enhance connectivity to ports and invest in port infrastructure. SB 28 will accomplish this goal by providing critical funding opportunities that ensure that our ports remain competitive.” The law makes it so that Texas Mobility Funds will only be used for port access improvement projects—projects that construct or improve public roadways that enhance connectivity to the port. The Texas Port Expansion Act also establishes a Ship Channel Improvement Revolving Fund and a revolving loan program, which will be used to fund qualified projects, such as deepening or widening a ship channel. Texas is the country’s greatest link to the world—its ports are an integral part of that. And to continue at the top of its game, the state will have to dig deep—in pockets and channels— to make way for improvements and investments, larger ships, and, an oncoming wave of success.

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July 2017 // Marine Log S5

Gulf Coast Headliner

Q & A With

Texas Secretary of State, The Honorable

Rolando B. Pablos By John R. Snyder, Publisher & Editor-in-Chief

exas “tea” ain’t the only thing brewing in the state. While oil always comes to mind when you think of Texas, the state actually has one of the largest and most dynamic and diverse economies in the world—boasting global leadership in renewable energy, medicine, agriculture, and manufacturing. Ports also play a central role in the state’s economy—more than $204 billion in international trade passed through Texas seaports in 2015. The newly opened Panama Canal expansion will benefit Texas seaports, as well as the export of Liquefied Natural Gas (LNG) from the U.S. So what does the future hold for the state? To find out, MARINE LOG

S6 Marine Log // July 2017

took the opportunity to chat with Texas Secretary of State Rolando Pablos, who has his finger on the pulse of the state’s economy. ML: Mr. Secretary can you tell us about your background? What are your responsibilities as Secretary of State? Secretary Rolando Pablos: I’m an economic developer with extensive experience fostering cross-border trade between Texas and Mexico. Before my current position, I served as the CEO of the Borderplex Alliance, based in El Paso, which worked to foster economic growth on both sides of the border. I’m deeply passionate about strengthening the State of

Texas, having grown up here and receiving all my education here, and I’m a living example of why Texas truly is the land of opportunity. As Secretary of State, I wear a number of different hats: I’m the State’s Chief Elections Officer, the Chief International Protocol Officer, the Border Commerce Coordinator, I’m responsible for maintaining Texas’ strong commercial relationship with our largest trade partner, Mexico, and our agency maintains all the business and public filings documents in the State of Texas. ML: Most people when they think of Texas, they think of oil and gas. In reality, Texas has one of the most diverse, complex and largest economies in the world. Can you talk about some of the important industries in the state? RP: As the world’s 10th largest economy, Texas stands at center stage in the global arena. Texas is not only a global energy leader, but also a leader in technology, medicine, manufacturing and agriculture. Recently, we added more than 22,000 private sector jobs in April. Our employment growth forecast is up from previous estimates, and Texas is expected to add nearly 290,000 jobs this year if we continue on our current path. Thanks to our access to global markets, world-class workforce, predictable and reasonable regulations, no state income tax, and outstanding quality of life, more and more employers from a variety of industries are looking at opportunities for expansion here in the Lone Star State. ML: How has the downturn in oil impacted the state’s economy? RP: Frankly, Texas has been through ups and downs in the oil market and we always come out stronger. Even in a down market during fiscal year 2016, the Texas oil and natural gas industry contributed an average of $26 million a day to state and local revenue. We learned valuable lessons during the 1980s and have since diversified our energy profile significantly so that we do not feel harsh effects from fluctuations in oil prices. We still have a large economic stabilization fund—or “Rainy Day Fund” —of more than $9 billion and are well-prepared, in fiscal terms, to withstand the effects of possible future fluctuations. The rig count is up and we have added oil and gas jobs for the past six months, so I am very confident that our entire energy profile—including oil and gas operations—will remain on solid footing. ML: Drilling has picked up in West Texas, but has lagged behind in the GoM. When do you see that picking up?

RP: The rig count in the Gulf of Mexico is remaining steady, and we do see future opportunities for expansion in offshore drilling. The main reason behind this optimism is the fact that offshore extraction is becoming progressively cheaper, thanks to innovative technology and techniques being employed by companies engaged in offshore drilling. I am confident that, even without a dramatic rise in oil prices, these technological advancements will help keep offshore drilling activities steady—and perhaps even spur a rise in activity—through the remainder of the year. ML: Secretary Zinke recently signed two secretarial orders, one of which directs BOEM to develop a five-year plan for offshore oil and gas exploration. What impact do you see that having on Texas? RP: We are very encouraged that the fiveyear plan will have the BOEM take a look at the potential in the Gulf of Mexico and examine ways that stakeholders— in both the private and public sectors—can influence offshore activities in the years to come. It is still too early to say what actual impact this will have on the Texas economy as a whole, but I believe that by bringing regulators and industry leaders to the table to develop the report, we will have a clear picture of the opportunities for offshore drilling in the near and long term. ML: What Trump Administration policies do you see having a positive impact on the state? RP: Any policies that reduce burdens on businesses and open up new markets for American exports to be sold abroad are positive steps for the United States and for Texas. We’ve just returned from China, where there is tremendous interest in importing LNG from Texas. We are encouraged by the recent announcement of the U.S.-China Comprehensive Economic Dialogue, which will hopefully result in the opening of a new export destination for Texas LNG. ML: Can you talk about Governor Abbott’s Rural Economic Development Initiative? How does it work and what are its goals? RP: Governor Abbott’s Rural Economic Development Initiative is a recognition that our rural communities have a tremendous amount of resources to offer for businesses seeking to invest and grow in Texas. We began our Rural Economic Development tour with two summits in East Texas and plan to continue traveling to other regions of the state to host additional summits. During these summits, we bring together public officials, economic development organizations, and business leaders to identify regional assets and encourage

greater cooperation in order to bring larger projects to rural Texas. We are looking forward to hosting summits in the Rio Grande Valley, the Panhandle, West Texas, and North Texas in the near future. ML: Texas has a strong renewable energy industry. Can you talk about its wind and solar production? What about equipment and components that are manufactured for the industries in the state?

As the world’s 10th largest economy, Texas stands at center stage in the global arena. — The Honorable Rolando B. Pablos RP: While oil and gas is a key component of our economic strength, we understand and recognize the immense value of diversifying our energy portfolio. Today, if you visit West and South Texas, you will likely see that wind farms are extremely prominent in our state’s landscape—in some

cases even more prominent than oil wells. In fact, Texas leads the nation in total installed wind capacity with 16,000 MW. We are number one in total energy production, biodiesel production capacity and solar energy potential. The geography and natural resources in our state bode very well for future expansion in the renewable energy sector—our high plains and coastal wind are perfect for facilitating this growth. Additionally, Texas’ business climate encourages renewable technology innovation and commercialization, and our state is home to leading research institutions working in renewable energy industry areas. ML: What other initiatives are underway in Texas that business investors should be aware of? RP: Texas is always exploring new ways to foster an even more attractive environment for foreign direct investment. In addition to our incentive programs, we are actively organizing inbound and outbound trade delegations so that we can educate potential investors and industry stakeholders on the tremendous benefits of doing business in and with the State of Texas. It is crucial for business leaders across the globe to understand the qualities that make the Lone Star State an ideal environment for businesses’ CEOs, employees, and families. In continuing to show the world what Texas has to offer, I am confident Texas will continue to lead the nation in Foreign Direct Investment.

July 2017 // Marine Log S7

Gulf Coast Headliner

Quiet Confidence McDermott International begins to upgrade its capabilities for an upturn in the market By John R. Snyder, Publisher & Editor-in-Chief

here’s a renaissance underway at McDermott International, Inc. and the market and investors are taking notice. The publicly traded Houston-based multinational engineering, procurement, construction and installation (EPCI) company recently entered into a 5-year Amended and Restated Credit Agreement with $810 million of capacity for letters of credit and a $300 million revolving cash sublimit. Additionally, the agreement allows for current or new lenders to increase commitments up to a total of $1 billion. “The increased limit of the facility, the $300 million revolving cash sublimit, as well as the extended maturity are a culmination of the financial transformation McDermott has made over the past few S8 Marine Log // July 2017

years,” says Stuart Spence, McDermott’s Executive Vice President and CFO. “The increased facility capacity underscores the confidence and support shown by our current and new lenders entering the facility and provides us with a simplified capital structure, increased balance sheet flexibility and positions us well for future growth.” Investment research analysts Zacks agrees. Zacks says, “The increased credit limit of the facility emphasizes the belief that creditors have in McDermott. The company has made a major turnaround through its cost saving initiatives to shore up its financials over the years. The company has also been winning a number of contracts lately, adding to its robust backlog of around $4 billion. McDermott recently won the Angelin gas field development

contract from BP p.l.c, which will get reflected in the company’s second-quarter 2017 backlog. The company’s broad product portfolio and impressive geographical footprint make both the investors and the lenders confident of McDermott’s earnings and cash flows.” Zacks says that McDermott International’s stock has risen 57% in the last year—a claim not many in the oil and gas sector can make. A key part of McDermott International’s transformation has been the addition of key executive leadership. One of those executives is Alan Marriott, Vice President Fabrication and Marine Assets and Operations at McDermott International, Inc. Marriott started his career building Trident missile-carrying nuclear submarines

in the U.K. and later joined McDermott for the first time in 1991 as a Project Engineer on diving support vessels for the North Sea. After spending eight years with McDermott, he held various executive management positions at Technip North America, including COO Subsea BU, Senior Vice President of Assets, and Executive Projects Director. Marriott rejoined McDermott about 18 months ago in the fall of 2015 to oversee the company’s worldwide operations of its fleet of 12 vessels and fabrication yards. In an interview with Marine Log, Marriott points to a number of changes at McDermott International that have him bullish on the company’s future. “From a McDermott perspective, we’ve always had a name out in the marketplace,” says Marriott. “In the late 90’s and early 2000’s, the DB 50 (Derrick Barge 50) almost exclusively worked for Shell. But we didn’t build on that momentum. We moved out of North Sea and West Africa and the company shrunk a bit.” Continues Marriott, “Three years ago the company went through a very tough time just to survive. But what I’m seeing now is a renewed ambition for growth. We’ve built the foundations up. There’s transformational growth for the company. What’s happening in the Middle East gives us a really solid base. We’re building on that. We have that worldwide brand out there. We are really well known in this industry and it gives us a great stepping stone to build it back up to what it should be. It is going to take a lot of effort, but the team is onboard and we will start to see those opportunities come to fruition. There still a lot of work to be done, but I’m really optimistic for the company’s future.”

points over the charter term. Built in 2014 by Lloyd Werft, the 27,449 dwt, DP2 vessel has two 400 metric tonne active heave-compensated mast head cranes, one on the aft and the other amidship, including a 30 metric tonne heave-compensated knuckle boom crane. “Apparently everyone says we stole it,” says Marriott. “Well, it was there for everyone to steal. I think you are constantly looking at distressed assets. Then you have

Every customer has something unique. Our role is to figure out what they need... [and] show that commitment to them.

to look at whether they strategically fit with what you want to do in your space. Buying a ship just because it’s cheap won’t help your business. It has to fit your plans.” Marriott points to the Ichthys LNG project about 220 km off the coast of Western Australia as an example of how the company can grow.

McDermott delivered an EPCI solution to what is one of the world’s largest subsea gas field developments. “We can manage a large scale project, but we had to use a partner. In that case, it was Heerema. Our goal is to do those projects ourselves. Part of my mission is to look at where we can identify those enabling assets and where we can acquire them at the competitive price.” The acquisition of the Amazon upgrades the deepwater and SURF capabilities of the company. Marriott thinks her first work now will be in Australia or the Middle East. Re-registered under the Malta flag, the Amazon will eventually undergo an upgrade at a shipyard in the second half of 2019. Once upgraded, the Amazon will position the company to pursue emerging opportunities in 2020. “We’ll be able to go after those big EPCI projects,” he says. McDermott is already looking to the future. Marriott says the company will continue to look for other distressed assets, but they will have to fit the company’s strategy and at the same time the company is also working on what specifications will be needed for its next generation of vessels. “We will continue to focus on our customers and try to understand their needs. Every customer has something unique. Our role is to figure out what they need. Their needs are different. Show that commitment to them. If you are able to do that it evolves into something more than just a customer-supplier relationship. It becomes a partnership. You’ll get that customer back.”

A KEY PIECE One of the things that Marriott was charged with when he came back onboard was looking at key pieces that the company could add to implement the company’s long-term growth strategy and renew and upgrade its fleet. One of the prizes McDermott was able to pluck from the market was the 653 ft x 106 ft deepwater pipelay and construction vessel Amazon from the U.K.’s Ceona. The acquisition cost, according to McDermott, was $52 million—some have priced the newbuild cost for the vessel at $350 million. The acquisition was funded through a sale and leaseback arrangement. McDermott will obtain control of the vessel for 11 years in exchange for a daily charter hire rate with options to purchase the vessel at different July 2017 // Marine Log S9

Gulf Coast Headliner

First Jones Act Wind Turbine Installation Vessel A joint venture between marine engineering firm Zentech Inc. and energy development project specialist Renewables Resources International unveiled plans late last month to build the first Jones Act-compliant, offshore wind turbine installation vessel. Houston-based Zentech, an expert in offshore rig design, says the installation vessel will be a self-propelled, DP2 Class jack-up with four truss legs with spud cans—a proven oil & gas design—integrated into a newly built hull. When not operating as an installation vessel, the jack-up will be capable of being used for decommissioning platforms in 300-ft water depths. Zentech President & CEO Ramesh Maini called the announcement “another defining moment in the evolution of Zentech as one of the world’s leading designers and turnkey providers of advanced offshore solutions.” The Jones Act vessel is designed to navigate the New Bedford Hurricane Barrier and will carr y and install in this

S10 Marine Log // July 2017

configuration components for at least three complete 6-9 megawatt (MW) range wind turbines. The vessel’s jacking system will be rated at a capacity of 16,000 tons, extending the unit’s service life. With evolving innovation, up to four 8MW range, fully assembled wind turbines can be installed using a patented cantilever package. The installation mechanism will be able to align the fully assembled wind turbines to the smallest degree of required accuracy; whether that is a translational or a rotational requirement. Using its innovative concept, the vessel will have the mechanism to enhance its stability to carry fully assembled wind turbines for anticipated 10MW or higher capacity. “ Wi t h l a r g e r s c a l e o f f s h o r e w i n d projec ts fol low ing Block Island, the U.S. market requires forward looking m a r i n e l o g i s t i c s , s u c h a s Z e n t e c h’s comp etitive, Jones Ac t compliant jack-up installation vessel,” says Andy Geissbuehler, Managing Partner of Renewable Resources International.

“This vessel,” adds Geissbuehler, “is another example of the important role the U.S. oil & gas industry will play in accelerating the U.S. offshore wind industry.” The deployment of a U.S.-flagged vessel is a positive sign and a step in the right direction for the offshore wind industry in the U.S.,” says Thomas Brostrøm, President of DONG Energy North America. “This will help in the creation of a sustainable supply chain that includes several suppliers and we welcome initiatives such as this from serious market players in the industry.” Zentech says discussions with U.S. shipyards indicate a delivery no later than fourth quarter of 2018. The unit will be constructed utilizing U.S.-built components such as barge, legs, spud cans and propulsion. In addition to enabling a competitive solution addressing the offshore wind industry’s Jones Act challenge, this U.S. built vessel will contribute to the revival of the nation’s shipbuilding industry and port infrastructure.

SeaOne Plans to Deliver Affordable Gas to Caribbean

This fall it is expected that Houston-headquartered SeaOne Caribbean, LLC a n d S o u t h Ko r e a n s h i p b u i l d e r Samsung Heavy Industries (SHI) will have a signing ceremony for the construction of a dozen of what will be the world’s largest and most powerful Articulated Tug/ Barge (ATB) units. The impressive order is part of a new Caribbean and Central American transp o r t a t i o n n e t wo r k t h a t w i l l d e l ive r CGL (Compressed Gas Liquid) cargo to customers in suppor t of the SeaOne Caribbean Fuels Supply Project. The 260-meter by 38-meter by 21.74meter ocean tank barges w ill feature SeaOne’s patented CGL technology and systems that includes the CGL containment system. Each ATB will have a displacement of 68,000 metric tonnes. The new service will be a real game-changer for the use of ATB technology, which will create a virtual pipeline at sea. The CGL Containment System is treated as an independent cargo and is not integral to the vessel design. The ATB cargo holds will be kept at a temperature of minus 40º C while the containment system is full, resulting in no sloshing or boil off and no retention of a

gas blanket after offloading of the cargo. The tugs in the ATBs will be large and powerful—measuring 50 meters long, 19.5 meters wide and 8 meters in depth, and fitted with IMO Tier III diesel engines to give the vessels a service speed of over 14 knots. Ten of the ATBs will be used for regular route service, while the other two will be used for shuttle service. The service is expected to be 10-days roundtrip, including port time. At t h e t i m e o f t h e a n n o u n ce m e n t of a Letter of Intent to build with SHI, Dr. Bruce Hall, President and COO for SeaOne, said, “SeaOne has been working with SHI for a while now and we have found them to be a proactive company that listens to new ideas in the gas and liquids transportation business and provides constructive input into the design of the CGL transportation vessels. We are pleased to have SHI as part of the project.” Daniel Cho, Vice President of Samsung Heavy Industries’ Rig & Industrial Ship Marketing said, “We are delighted to participate in SeaOne Caribbean’s Fuels Supply Project with the construction and supply of the articulated tug and barges, and hope to build a lasting relationship

with SeaOne hereafter.” Classification society ABS has worked with SeaOne from the outset of the project to help ensure the vessels will comply with the highest standards of construction and safe operation. The ATBs, designed by Ocean Tug & Barge Engineering Corp., Milford, MA, will fly the flag of the Republic of the Marshall Islands. The signing of the LOI for the ATBs is seen as a major milestone in SeaOne’s extensive Caribbean Fuels Supply Project. The project is being undertaken to develop an environmentally friendly, low cost, and safe means of transporting gas and gas liquids together as a single cargo. SeaOne has signed a 40-year lease with the Port of Gulfport in Gulfport, MS, for 36 acres of land where it will construct, in multiple phases, a 1.6 Bcf/d CGL production and export facility. Completion is expected by 2020. At the Gulfport facility, SeaOne will transfer the produced CGL to ATBs to transport and deliver the customers’ product efficiently, safely and cost effectively to CGL receiving terminals in various Caribbean and Central American markets, including Puerto Rico. July 2017 // Marine Log S11

Gulf Coast Headliner

Conrad Shipyard Mourns Passing of Founder Parker Conrad

The industry has lost a pioneer and Conrad Shipyard its leader. Earlier this month, Conrad Shipyard, Morgan City, LA, announced the passing of its founder, John Parker Conrad Sr. He died peacefully at his home on July 6 surrounded by family and friends. He was 101 years old.

A shipbuilding pioneer and a legend along the Gulf of Mexico coast and beyond, Parker founded Conrad Industries in 1948. Conrad now has five shipyards along the Louisiana-Texas coast. From age 12 to age 17, Parker trained as a Christian Brother, which formed in him a deeply rooted and lifelong commitment to others. He supported many charitable and community causes in South Louisiana, and received numerous awards for his accomplishments and philanthropy. An avid hunter and outdoorsman, Parker was a conservationist with a profound respect for the environment. Parker and his wife Shirley were happily married for 64 years, until her death in 2006. He is survived by his son and daughter, grandchildren and great grandchildren. “Parker Conrad was a kind and gentle man, and with his wry smile, his charismatic personality and lively sense of humor, he will be sorely missed by the many thousands of lives he touched along the way,” said the company in a statement.

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S12 Marine Log // July 2017

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Bollinger delivers FRC 24 to USCG Bollinger Shipyards has delivered the USCGC Oliver Berry, the 24th Fast Response Cutter (FRC) to the U.S. Coast Guard. The vessel’s commissioning is scheduled for October 2017 in Honolulu. “We are extremely pleased to announce the delivery of the latest FRC, the USCGC Oliver Berry,” said Bollinger President & CEO Ben Bordelon. “This FRC built by Bollinger Shipyards will be the first to be stationed at U.S. Coast Guard District 14 in Honolulu, Hawaii. Previous cutters have been stationed in Florida, San Juan, P.R., [and] Cape May, N.J.” Bordelon calls the FRC program “a model program for government acquisition” that has surpassed all historical quality benchmarks for vessels of this type and complexity. “We are extremely proud that the Fast Response Cutters built by Louisiana craftsmen here at Bollinger Shipyards are having such a major impact on our nation’s security,” he said. The 154 foot patrol craft USCGC Oliver Berry is the 24th vessel in the Coast Guard’s Sentinel-class FRC program, which is based on a proven, in-service parent craft design, the Damen Stan Patrol Boat 4708. Each FRC is named for an enlisted Coast Guard hero who distinguished him or herself in the line of duty. This vessel is named after Coast Guard Hero Oliver Berry. Berry, a distinguished expert mechanic on CG aircraft, was lead instructor at the first U.S. military helicopter training unit established in 1946. He received a letter of commendation from the commandant, Adm. Joseph F. Farley for his contribution to a 1946 rescue of airliner crash victims in Newfoundland, which required the rapid dismantling, air transport and reassembly of Coast Guard helicopters. Berry was commended for his meritorious service and the outstanding manner in which he performed his duties.

Austal Wins $584.2 Million LCS Contract

Austal reports that it has won a contract worth up to $584.2 million to build the Independence Class Littoral Combat Ship LCS 28 for the U.S. Navy. In a stock exchange announcement, Austal said “the 127 meter frigate sized LCS 28 will be the 14th LCS constructed at Austal’s U.S. shipyard in Mobile, AL, and represents a continuing vote of confidence in Australia’s design and shipbuilding capability for large naval vessels.” Austal CEO David Singleton said, “We

won this award following a direct competition with the Freedom Class LCS which says much for our cost efficiency on this program. Austal’s work on the LCS program at our advanced Module Manufacturing Facility (MMF) has seen efficiency gains of 20 percent with an ambitious target of 35 percent set for the end of the build cycle.” Austal USA President Craig Perciavalle said, “We’re very proud to be awarded this contract in such a highly competitive environment. This demonstrates the Navy’s

confidence in Austal being a key component in building their 355-ship fleet, which is a testament to the hard work and dedication of our incredible employees.” Austal continues to reduce cost and deliver on schedule having delivered two LCS ships in 2016 and set to deliver two more in 2017, all under the congressional cost cap. This, along with the successful Expeditionary Fast Transport (EPF) program, positions Austal well with affordable solutions to rapidly and efficiently support the Navy’s desired fleet of 355 ships. The Pentagon announcement of the award noted that the $584.2 million fixedprice-incentive firm target contract for the construction of an LCS “also includes options for the construction of additional LCS, class services, and post-delivery availability support. The Navy expects to release a competitive solicitation(s) for additional LCS class ships in future years, and therefore the specific contract award amount for these ships is considered source selection sensitive information.”

Serving Hawaii Is Our Business Pasha Hawaii’s dynamic shipping network and knowledgeable professionals are here to serve your supply chain needs. Pasha offers the broadest range of container and roll-on/roll-off services between Hawaii and the Mainland, with connections to comprehensive intermodal services nationwide. Find out more at pashahawaii.com.

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July 2017 // Marine Log S13

Gulf Coast Headliner

Metal Shark Reels In A Big One Metal Shark’s hot streak continues. The Louisiana-based shipbuilder has announced that it has been selected by the U.S. Navy to build Near Coastal Pa t r o l Ve s s e l s ( N C P V s ) f o r Un i t e d S t a t e s p a r t n e r n a t i o n s t h ro u g h t h e Department of Defense Foreign Military Log 4.5 x 7.375 inch.pdf Sales (FMS)Marine program. Metal Shark’s proposal 1

was selected by Naval Sea Systems Command from a field of six competing shipyards. Under the terms of the contract—potentially worth up to $54 million—Metal Shark will build up to thirteen 85-ft Defiant Class welded aluminum cutters for the Dominican Republic, El Salvador, 5/29/17 2:36 PM Honduras, Costa Rica, Guatemala, and

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S14 Marine Log // July 2017

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other U.S. partner nations. In addition, Metal Shark will supply electro-optical infrared sensors, diagnostic equipment, in-country reactivation, crew familiarization, and test support to NCPV operators. The vessels will be based on Damen’s Stan Patrol 2606 design, tailored by Metal Shark to suit the requirements of the NCPV mission. Missions for the NCPVs will include search and rescue, border patrol, police and customs duties, counter-narcotics operations and securing waters of economic importance. “The NCPV award is the first result of a multi-year collaboration between Damen and Metal Shark,” said Metal Shark CEO Chris Allard. “The Damen team has consistently provided us with outstanding technical support, their designs are thoroughly proven in service across a range of markets, and their global service network has proven to be a very powerful selling feature. Metal Shark is eager to begin NCPV construction and showcase our capabilities as we quickly and efficiently build and deliver these state of the art patrol cutters.” “ Me t a l S h a r k h a s l o n g i m p r e s s e d us with their ambitious growth and their considerable eng ineer ing resources,” said Jan van Hogerwou, Damen Shipyards’ North American VP of New Construction. “Damen is proud to now become a part of the Metal Shark growth story as we work together to deliver this newest fleet of Stan Patrol vessels to military operators worldwide.” The NCPV fleet will be built at Metal Shark’s Franklin, LA facility, which recently completed delivery of six high-speed passenger ferries for New York City’s NYC Ferry operated by Hornblower, and delivered the first six of 18 45-ft long patrol boats for the Vietnam Coast Guard.

ABS Founded in 1862, ABS sets the standard for safety and excellence as one of the world’s leading ship classification organizations. The ABS mission is to serve the public interest as well as the needs of its members and clients by promoting the security of life and property and preserving the natural environment. As classification continues to evolve, ABS assists owners and operators with tackling the most pressing technical, operational and regulatory challenges so the marine and offshore industries can operate with greater levels of safety, security and responsibility. ABS ABS Plaza 16855 Northchase Drive Houston, TX 77060

T: (281) 877.6000 F: (281) 877.5976 www.eagle.org

Bahri Logistics One of the top 10 breakbulk carriers in the world, Bahri Logistics operates six (6) state-of-the-art multipurpose vessels; four (4) connecting the U.S., Saudi Arabia, Arabian Gulf, Indian subcontinent, Mediterranean and two (2) linking Northern Europe, Saudi Arabia, Arabian Gulf and the Mediterranean. Bahri is adding to its regular itinerary, a direct port call at Alexandria, Egypt to offer breakbulk and ro-ro service from North America into Alexandria and from Alexandria into the Middle East and India. Bahri Logistics 400 East Pratt St.; Suite 400 Baltimore, MD 21202

T: (410) 625.7000 F: (410) 625.7050 www.bahri.sa

Louisiana Cat Louisiana Cat’s Power Systems Division is the authorized Caterpillar dealer for sales, service, parts, specialized engineering, manufacturing, and packaging for diesel and natural gas engines. They are conveniently located in Morgan City, Port Fourchon and Bossier City, with their Power Systems Headquarters in the Port of New Iberia. The New Iberia Facility is their engineering, manufacturing, and packaging center for Oil & Gas, Marine, and Electric Power Generation Solutions. Louisiana Cat 3799 W Airline Highway Reserve, LA 70084

T: (985) 536.1121 F: (985) 536.4549 www.louisianacat.com

Metal Shark Established in 1986, Gravois Aluminum Boats LLC, and its government/commercial boat entity Metal Shark Boats are leading suppliers of custom boats for defense, law enforcement, and commercial entities. Key customers include the United States Coast Guard, Navy, Air Force, Army, foreign militaries, law enforcement agencies,

passenger vessel operators, pilot associations, fire departments, and other operators worldwide. Under the direction of its owner/operator Allard and Gravois families, Metal Shark has produced over 500 vessels in the past three years at its two fully self-contained South Louisiana production facilities. Metal Shark produces a wide range of custom monohull and catamaran vessels up to 250’. Metal Shark 6814 E. Admiral Doyle Drive Jeanerette, LA 70544

T: (337) 364.0777 F: (337) 364.0337 www.metalsharkboats.com

THE PASHA GROUP Established in 1947, The Pasha Group is a family-owned, third-generation diversified global logistics and transportation company that provides ocean transportation for containers and rolling stock between the U.S. West Coast and Hawaii; port processing for finished and privately owned vehicles; stevedoring for vehicles, breakbulk and container cargos; auto hauling services throughout the contiguous U.S.; domestic and international relocation services; and international logistics management for general commodity and project cargoes. The Pasha Group 4040 Civic Center Drive, Suite 350 San Rafael, CA 94903

T: (415) 927.6400 F: (415) 924.5672 www.pashagroup.com

Port of Galveston The Port of Galveston is one of Texas’ major seaports. As a selfsupported, enterprise funded Landlord Port with facilities and property approximating 850 acres on Galveston Island and adjacent Pelican Island, the Port facilitates the movement of a diverse mix of domestic and international cargoes and cruise passengers that deliver value to the region and the state. The Port serves the cargo, cruise and offshore oil and gas industries simultaneously. Port of Galveston 123 Rosenberg Ave. Galveston, TX 77553

T: (409) 765.9321 F: (409) 766.6171 www.portofgalveston.com

W&O Founded in 1975, W&O is one of the world’s largest suppliers of pipe, valves, fittings as well as actuation and engineered solutions to the maritime and upstream oil & gas industries. Serving a variety of customers, W&O operates a worldwide network of strategically located branches from its corporate headquarters in Jacksonville, Florida. W&O 2677 Port Industrial Drive Jacksonville, FL 32226

T: (904) 354.3800 F: (904) 354.5321 www.wosupply.com July 2017 // Marine Log S15

ÂŠ marekuliasz/Shutterstock

LEADING THE WAY IN SUBCHAPTER M SOLUTIONS ABS provides fully integrated solutions to help owners and operators achieve and maintain Subchapter M compliance. As a USCG Recognized Organization and approved Third Party Organization, ABS offers auditing, surveys and USCG authorized plan review. The ABS Nautical SystemsÂŽ software application NS Workboat supports all compliance options and comes pre-configured on a mobile tablet. With more than 30 locations in the U.S. supported by a seasoned team of surveyors, auditors and engineers, ABS has the geographic coverage and experience to help industry meet Subchapter M requirements. Contact us today to learn about or request ABS Subchapter M solutions: SubchapterM@eagle.org.

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SAFETY | SERVICE | SOLUTIONS

LNG

SHAKING UP

THE JONES ACT

U.S.-flag blue water operators embrace LNG as fuel; a new player in the Hawaiian market could emerge Compiled by Marine Log Staff

lue water tonnage in the Jones Act trade has gotten a lot greener in the last few years. That’s been driven in large part by the stricter emissions requirements of the North American and U.S. Caribbean Emissions Control Areas. Since 2015, U.S.-flag shipping companies American Petroleum Tankers (APT), Crowley Maritime, Kinder Morgan, SEA-Vista, and TOTE have added 16 vessels—product tankers or containerships—that are either capable of burning Liquefied Natural Gas (LNG) as fuel or are LNG-Ready. LNG-Ready means that the ships have been classed as being designed with the possibility of retrofitting them at a minimum cost in the future to burn LNG. And IMO’s 0.5% Global Sulfur Cap is just on the horizon. In the coming years— based on the current order book and announced plans—another 15 dual-fuel and LNG-Ready newbuild vessels could join the U.S.-flag fleet. Among those building or near ordering are Matson Navigation, Crowley Maritime, APT, and a potential new entrant into the Hawaii trade. This past May, Honolulu-based Pasha Hawaii selected the Keppel AmFELS shipyard in Brownsville, TX, to move forward with a potential contract to build two

2,525-TEU dual fuel containerships for the Hawaii trade. When consummated, the contract would contain options for two more sister vessels. Pasha Hawaii says it is in the process of finalizing contract specifications. At press time, a Pasha Group spokesperson said that there was no update on the contract process.

Philly Shipyard’s Monkey Wrench One thing that could have thrown a monkey wrench into the negotiations was the announcement by Philly Shipyard, Inc. (PSI), Philadelphia, PA, that it had begun construction of up to four new, dual-fuel containerships based on the Aloha Class for new entrant into the containership trade between the U.S. mainland and Hawaii to operate these vessels. The formation of that new entrant is being promoted by Philly Shipyard. Deliveries of the new ships would be planned for 2020 and 2021. The announcement came after The Pasha Group said it had selected Keppel AmFELS for its new containerships. Philly Shipyard was the other shipyard shortlisted by The Pasha Group to potentially build its boxships for Hawaii. Presently, says Philly Shipyard, “this trade route is serviced by only two carriers

and is reliant in part on a group of near end-of-life steamships.” One of those carriers is Matson, which is building two 3,600 TEU LNG-fueled Aloha class containerships at Philly Shipyard. Designed by KOMAC (Korea Maritime Consultants), those Hulls, 029-030, are scheduled for delivery in 2018 and 2019. Philly Shipyard says that the four new ships it is now starting work on “will be the direct continuation of the [Aloha Class] series” and that “the operational benefits offered by series production with familiar ships, coupled with its historical access to vessel financing, places PSI in an advantageous position to build vessels for a new cargo liner service between the U.S. mainland and Hawaii.” The shipbuilder says it has a successful track record of promoting the formation of new vessel owners in the Jones Act market, such as American Shipping Company and Philly Tankers. Philly Shipyard says it is presently engaged in advanced discussions with a major U.S. shipping operator about establishing a new, financially strong carrier with a fleet of modern vessels to be built by PSI to support commerce between the U.S. West Coast and Hawaii. Several prominent investors July 2017 // Marine Log 17

LNG and lenders in the U.S. shipping market have expressed interest in taking part in this opportunity. In addition, a highly regarded maritime leasing company has issued an indicative offer with preliminary terms for a bareboat charter structure. “We are excited to get started on building a new fleet of containerships for a new carrier in the Hawaii trade and are pleased to have received such positive feedback from wellknown U.S. marine players and financing sources,” remarked Steinar Nerbovik, Philly Shipyard’s President & CEO. “Philly Shipyard has a strong track-record of building quality vessels for this trade, and we believe local communities can benefit greatly from the safe and reliable service provided by our modern, efficient and ‘green’ ships.” PSI has retained John Keenan, who served in various key leadership roles at Horizon Lines, including as President and Chief Operating Officer from 2007-2011. Horizon Lines’ Hawaii business was acquired by Pasha Hawaii in 2015. “When strict MARPOL/ECA emissions regulations take effect in 2020, several of the older steam powered vessels serving the Hawaii trade route today will be out of compliance without substantial, costly modifications,” says PSI. “Even if these aging

steamships are modified, they would be less reliable and carry significantly higher operating costs than modern vessels in areas such as fuel consumption and manning and maintenance requirements.” PSI says it believes these circumstances create a unique opportunity for a new Jones Act carrier to enter the Hawaii containership trade with a fleet of cost-efficient and eco-friendly container vessels built by PSI. It argues that unless these new ships enter the Hawaii trade route starting in 2020, local commerce may be adversely impacted by the new emissions standards. It plans to deliver the first pair in 2020 and the second pair in 2021. In a filing on the Oslo stock exchange, Philly Shipyard said it had “commenced design work and procurement activities for Hulls 031 and 032” and that it expected to commence production on Hull 031 in the second quarter of 2018.

Pasha Vessels Meanwhile, the new Pasha boxships will carry 2,525 TEU, including a fully laden capacity of 500 45-foot containers, 400 refrigerated containers, and 300 40-foot dry containers, with a sailing speed of 23 knots. Delivery of the first vessel is expected in the first quarter of 2020, with delivery of the

second vessel in the third quarter of 2020. George Pasha IV, President and CEO of The Pasha Group, says that the LNG propulsion technical expertise of Keppel O&M—Keppel AmFELS’ parent—was an important factor in the shipyard’s selection “Their experience in LNG vessel conversions will also prove to be very valuable as we build LNG dual-fueled vessels for the Hawaii trade.” Mr. Pasha told Marine Log, “Choosing LNG to fuel our new vessels is a natural progression for us as we strive to minimize Pasha Hawaii’s environmental footprint and increase fuel efficiency for our fleet. It’s a cleaner-burning fuel that’s better for the communities we serve, the folks working our ships, and ultimately for our customers in the Hawaii trade. At this time, we are performing our due diligence on gas supply details to support our service routes.” Mr. Pasha points out that the new ships “are specifically designed to provide additional capacity for high-demand 45 ft dry and 40 ft refrigerated containers. Providing multiple weekly sailings with the additional capacities offers customers the frequency, efficiencies, and reliability they count on to meet the high demands of a sophisticated client base.”

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18 Marine Log // July 2017

Digitalization Feature

THE FUTURE

of shipping Hundreds of new technologies, services on display; emphasis on increasing automation and digitalization

he Internet of Things (IoT), cloud computing, Augmented Reality (AR), robotics, 3D scanning, and automation are going to play an increasing role in every day ship and shipbuilding operations. According to key findings in a study conducted by Inmarsat, the IoT is now the leading technology for digital transformation and is the number one priority for 92 percent of organizations. The Inmarsat Research Program study focusing on the enterprise application of the IoT revealed that machine learning (38 percent), robotics (35 percent), and 3D printing (31 percent) were also key requirements for effectively delivering digital transformation for business. That was clear from the buzz created by the hundreds of products, equipment and services on display at the Nor-Shipping conference and trade show. “Digital disruption is already affecting the marine sector and will do so increasingly in the future,” says Marco Ryan, Wärtsilä Chief Digital Officer and Executive Vice President. “There is today a subtle, yet significant, shift in thinking at all levels of the industry as we move from closed systems to more modular, secure, and interoperable products and solutions.” Higher bandwidth satellites in conjunction w ith advances in shipboard

monitoring systems are now moving shipping towards remote ship monitoring and autonomous operations. Iridium just doubled the size of its Iridium NEXT network with a deployment of 10 satellites during a SpaceX launch last month. Overall, Iridium plans to deploy a total of 75 satellites in the Iridium NEXT network to provide global L-band satellite broadband speeds through smaller, cost-effective antennas for its Iridium Certus satellite services. At a Nor-Shipping press conference, Cobham SATCOM unveiled its first Iridium Certus Connected terminal, the SAILOR 4300. The SAILOR 4300 is a Broadband Core Transceiver (BCX) type terminal, offering a highly reliable link over the Iridium NEXT satellite network with speeds suitable for data-heavy applications including videoconferencing, multi-user Internet/ VPN, IoT and telemedicine; alongside regular usage including email, electronic forms/ reporting and crew communications. Eniram, a Wärtsilä company, demonstrated its updated Skylight 2.0 fleet performance monitoring service. The idea behind the service is to provide accurate tracking of your vessel’s fuel consumption and performance at a very affordable price. Your ship is equipped with a portable, battery-powered Eniram transponder—kind of like a Fitbit for your ship. The service uses

the near real-time movements sent by the transponder via a two-way Inmarsat satellite connection, combined with noon reports automatically collected from e-mails. Eniram combines the vessel tracking data with meteorological data in order to model the vessel’s speed through water and fuel performance. The performance data and the route are delivered to the home office in an easyto-interpret format via Eniram Fleet cloud software and reports. Traditional maritime companies, such as Wilhelmsen Ships Service AS (WSS)— whose roots stretch back to 1861—are already transforming themselves and their services. One of several digital products it teased was the Smart Ropes system. How do you make a rope smart? Using the Timm Acera rope range, an embedded load sensor provides real time information on tension, along with logging usage and longevity, relaying data to a base station located on deck. Giving an overview of rope tension via the Digital Mooring Assistant, Smart Ropes enables crew to moor their vessels safely, accurately and efficiently. WSS is also working with drones, AR and has begun researching in-port 3D printing to produce marine products and spare parts. Check out this month’s Marine Innovations for more cutting-edge technology highlights from Nor-Shipping. July 2017 // Marine Log 19

Conference & Expo

SHIPS

Transformative Technologies: Safer, Greener, More Efficient OPENING REMARKS: SMART SHIPPING Howard Fireman, Chief Technology Officer & Sr. Vice President, ABS

BATTERIES FOR COMMERCIAL SHIPPING Anthony Teo, Technology & LNG Business Development Dir., Region NA, Maritime, DNV GL

AUTONOMOUS SHIPS: REGULATORY CHALLENGES Sean T. Pribyl, Associate, Blank Rome LLP

PANEL: LNG & ALTERNATIVE FUELS Jason Chesko, Sr. Manager, Global Market Development, Methanex Corporation

MARKETING OPPORTUNITIES Exhibits & sponsorships available 212.620.7208 | conferences@sbpub.com

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ALSO ON THE AGENDA • Big Data & Remote Monitoring • Marine Apps • Hybrid Propulsion Technology • Robots, Drones & AUVs

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Don’t let a date at the Drydock

Dry up your bottom line

How Grooved Solutions Helped McAllister Towing Minimize Downtime Special to Marine Log

rydocking is a complex process that is both expensive and time consuming. However, it is a necessary burden that ship owners, operators, and crew members must go through when the time requires. Any vessel that’s tied up in maintenance is a lost revenue opportunity. Thus, limiting time out of service by performing repair and retrofit services dockside or afloat is of critical importance. A great industry case comes from McAllister Towing & Transportation, a company that has been active for more than 150 years, surviving and thriving during a Civil War, two World Wars, and the Great Depression. 22 Marine Log // July 2017

McAllister operates a fleet of more than 70 tugboats and 12 barges along the U.S. East Coast from Portland, ME to San Juan, PR. Their mission mix runs the gamut including ship docking, general harbor towing, coastal towing and bulk transportation in each port. The company got its start when Captain James “Whiskers” McAllister, an immigrant from Ireland, founded it with a single sail lighter—and is currently led by fourth (Captain Brian McAllister) and fifth generation McAllisters (Buckley and Eric). McAllister Towing has become one of the oldest and largest marine towing and transportation companies in the United States.

McAllister operates three tugs out of Baltimore, including the Robert E. McAllister, a harbor assist tractor tug. Built in 1969 by Peterson Builders of Sturgeon Bay, WI, the Robert E. McAllister was originally a U.S. Navy vessel, the USS Nanticoke (YTB-803). The USS Nanticoke was eventually struck from the Naval Register in 1999, and, in 2002, sold through the Defense Reutilization and Marketing Service to Nix’s Mate Equipment Company of S a l em , NH , where it was renamed the Canal Protector. McAllister later acquired and renamed the tug the Robert E. McAllister. In 2005, it was rebuilt. Two Caterpillar 3516B diesel engines replaced the tug’s single Fairbanks-Morse

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MAINTENANCE engine, and the rudder and propeller were replaced with a pair of Schottel SRP 1012 Z-drives rated 4,000 hp.

Long Term Solutions to a Recurring Problem Reinvesting in the business has long been part of the McAllister business strategy, but not surprisingly, and despite all the upgrades performed by McAllister, a bolted sleeve type coupling on the Robert E. McAllister’s engine cooling water supply line sprung a leak, something that had happened before. Previous attempts to tighten it were not successful in the long run so the company started looking for another repair solution that would be definitive and effective. The coupling used on the tug, and other engine cooling water lines in the McAllister fleet, is a non-restrained coupling, meaning there’s nothing to hold the coupling in place on the joint. On another McAllister tug, the same type of coupling slipped and started to flood the engine room. So, this was clearly a regular issue affecting fleet operations. While investigating his options, port engineer Carlo Parrotta had to find a solution that would limit the tug’s time out of service and avoid the drydock. Parrotta explained, “Replacement with the same or a similar type of coupling was certainly an option, but would have required a harness to be installed to prevent the coupling from slipping. It also would have made it more difficult to service the systems surrounding it.” Parrotta had used Victaulic products in previous roles throughout his 25-year career in the maritime industry and was certain the company could provide a definite solution to this issue. Mechanical pipejoining systems manufacturer Victaulic provided Parrotta with company representatives who upon inspection recommended the Style 99 Plain End Roust-A-Bout Coupling to replace the bolted sleeve couplings. It’s installation would prevent drydocking during an engine cooling water supply leak, emptying the fuel tank, cleaning, and overall increased costs.

Style 99 Rigid Coupling The Style 99 is a rigid coupling that has integral hardened carbon steel “teeth” that bite into the outer diameter of each pipe-end, providing the steel-to-steel engagement Parrotta desired. Positive engagement of the pipe is achieved when the bolts are torqued to specification, as marked on the coupling housing. No special pipe preparation—beyond 24 Marine Log // July 2017

ensuring a smooth, debris-free surface at the pipe-ends—is required prior to assembly. The Style 99 has multiple IACS type approvals and is Coast Guard approved. ABS type approvals cover fresh water systems, sea water cooling, ballast systems, vents, overflows and sounding pipes, potable water systems, and fire main systems. Plain-end couplings such as the Style 99 are advantageous for retrofit and repair services because there’s little upfront tooling cost. The lack of extensive pipe-end preparation means the coupling can be installed quickly, limiting downtime. Thus, McAllister decided to move forward with the repair using the Style 99 couplings.

Cost-Saving Solution To complete the repair, the bolted sleeve couplings were disassembled and removed, the pipe was pulled from the hangers, and the pipe-ends were cleaned of scaling, rust and paint where the new couplings would

My goal is to do the job as efficiently and safely as possible...If I save time, I save money for the company.

be installed. The pipe was then repositioned and the Style 99 couplings were assembled on the joints. The repair was completed dockside in just over an hour. Parrotta, who installed the couplings himself, remarked that the installation process was very simple. It did not require him to bring in a certified welder and deal with the safety hazards and other considerations welding in the space would have posed. Eliminating welding also meant significant cost savings. Instead of paying a welder for an eight-hour day, the cost was limited to the price of the couplings, which was well within the repair budget. Hot work was avoided by completing the on-board connections with the Style 99 couplings, it also meant there was no need to clean the surrounding area of standing oil or oil vapors, no need for a fire watch, and no need for weld inspection. McAllister’s Parrotta was able to cold-cut the pipe,

cap the fuel end of the pipe, and use a torch to remove the remaining portion on the deck and install the new section of prefabricated pipe. The work was completed dockside with incredible success. “I saved myself several thousand dollars on a marine chemist, several thousand dollars on cleaning the tanks, and the aggravation of waiting several years until the next drydock,” Parotta said, adding, “If you add all these costs, I would have been, conservatively, $15,000 in the hole —all that, just to weld a little hole. When you’re doing all this, the boat is not available for work. By doing it the way we did, it was a fraction of the cost and it took us three hours to do it, compared to probably a week.”

Optimizing the Entire Fleet Furthermore, Parrotta is using the Style 99 coupling for other applications where the cost savings are even more substantial, such as fuel oil vent lines, which are notoriously difficult to work with. Being above deck and exposed to salt water, varying weather conditions and damage, the vents need constant maintenance as well as testing to ensure proper function. The mechanisms don’t get serviced very often—usually every four to five years at dry dock time. During that time, the threaded joints are susceptible to rust and are typically covered in multiple coats of paint, making the vents extremely difficult to remove. Based on the success of previous applications of the Style 99 couplings, Parrotta is now cutting and rejoining the pipes with Victaulic plain-end couplings. This allows personnel to remove the vent for servicing by simply loosening two bolts and removing the coupling from the joint. Reinstallation is as quick as the initial installation. “It makes our job effortless,” said Parrotta, adding that he has completed this work on two of the three tugboats based in Baltimore, and is recommending it to other McAllister port engineers. “My goal is to do the job as efficiently and safely as possible, and with the least amount of stress and time. If I save time, I save money for the company and reduce the time the tug is not available to do its job. And it’s being done safely, and with a reliable product. I’m happy. I’ve been using [Victaulic couplings] for years, and I’ve never had a problem,” said Parrotta. The Victaulic Style 99 Plain End RoustA-Bout Coupling has proven advantageous for McAllister Towing & Transportation in multiple ways, from reducing time out of service, to limiting repair costs and safety hazards and optimizing the fleet.

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Newsmakers

DNV GL Aims to Strengthen its Presence in America DNV GL has named Edward Cuoco Vice President of its Market and Policy Development Group. Cuoco brings with him experience in combining data science, change and risk management, as well as energy wholesale and retail markets. Huntington Ingalls Industries (HII) has named Ashley Godwin Director of Federal Policy. She recently served as the Senior Defense and Government Affairs Advisor for the Shipbuilders Council of America. John Temple has been appointed Vice President, Strategic Sourcing at HII’s Newport News Shipbuilding unit.

Elliott Bay Design Group, Seattle, WA, has announced the appointed of Stephanie Gullickson as Marketing Manager. She will be responsible for the development of polices, processes, and procedures. Netherlands-headquartered Vryhof, has named Evan Zimmerman Vice President and Chief Technology Officer of the company. The anchor and mooring systems specialists also announced the addition of Clement Mochet as the new Commercial Director for Vryhof’s business unit, Vryhof Anchors. Former CEO and President of TBS Ocean Logistics Gregg McNelIs has been appointed to the position of COO at iMarine Software.

Viking SeaTech, has appointed Craig Smith as Marine Projects Manager to head up business activity in the St. John’s, Newfoundland region. Douglas Natoce has joined waterjet manufacturer Marine Jet Power, Inc. as President and Regional Director for the Americas. He brings with him 37 years of experience in the commercial watercraft business. Hendry Marine Industries, Inc. has launched a new Business Development Team. Kristen Chittenden has been appointed Director of Business Development and Eric Smith has been named Vice President and Chief Commercial Officer.

July 2017 // Marine Log 27

TECH NEWS First Remotely Operated Commercial Vessel Debuts

COMPLETE CAT POWER The Z-drive tractor tug, the Dr. Hank Kaplan, has become the first vessel in North America to feature a complete Cat Marine propulsion system. Designed by Robert Allan Ltd., the Ramparts 2400 Z-drive is owned by Seattle-based Harley Marine Services and built by the Diversified Marine shipyard in Portland, OR. The 80 ft x 36 ft x 13.7 ft tug is equipped with two 3516C marine propulsion engines, each delivering 2,675 hp to a pair of Cat MTA 524-T azimuth thrusters specifically designed for high performance applications. The Cat MTA 524-T is the latest in Caterpillar Propulsion’s thruster line and is optimized for the tug’s unique profile—it maximizes bollard pull, simplifies installation and maintenance and increases maneuverability. “We’ve taken pride in helping Harley Marine continue to expand their fleet over the last

twenty years,” says Rob Coon, Managing Director, Caterpillar Finance Products Division. “The christening of this vessel signifies a successful team effort between Cat Financial, Cat Marine, Peterson Power and Harley Marine.” Cat dealer Peterson Power, Portland, OR, led the project efforts, refining the spec and supporting the installation and services of the system. The Dr. Hank Kaplan is named after the Chief of Medical Oncology at the Swedish Cancer Institute and serves as a tribute to his tireless dedication to cancer treatment and research. The Harley Marine organization has been a long time supporter of Dr. Kaplan’s fundraising efforts. In the past five years alone, their annual fundraising event has contributed $2.5 million in funding to the Swedish Cancer Institute. www.cat.com

Software to Improve Operational Insight Dover Energy Automation, a provider of products, intelligent productivity tools and related automation software for the energy sector, has launched Windrock Enterprise, an asset-performance management solution that improves equipment visibility and operational insight—by providing actionable insights and predictive

advisories on equipment, industrial assets and even your plant site. With a goal of keeping your enterprise in mind, the solution provides executives with real-time remote visibility of an entire fleet of assets, simultaneously. From any computer or mobile device, Enterprise stakeholders, with proper credentials, will have on-demand access to crucial insights about the immediate health of all their assets. The goal is that by using the new solution, enterprises will have the ability to proactively avoid catastrophic scenarios, cuts costs, maximize safety, and increase performance oversight, flexibility and responsiveness. www.windrock.com/enterprise

28 Marine Log // July 2017

Technology is ushering in a new age of shipping. Rolls-Royce has teamed up with towage operator Svitzer, part of the Maersk Group, to launch the world’s first remotely operated commercial vessel. Designed by Robert Allan Ltd. and built at the Sanmar Yard, the 28 m Svitzer Hermod safely conducted a number of remotely controlled maneuvers in Copenhagen harbor, Denmark. From the vessel’s remote base at Svitzer headquarters, the captain berthed the vessel along the quay, undocked it, turned it 360 degrees, and piloted the tug to Svitzer HQ before docking again. “We’ve been saying for a couple of years that a remotely operated commercial vessel would be in operation by the end of the decade. Thanks to a unique combination of Svitzer’s operational knowledge and our technological expertise, we have made that vision a reality much sooner than we anticipated,” says Mikael Makinen, Rolls-Royce, President – Marine. The tug’s primary systems include autonomous navigation, situational awareness, a remote control center and communications. The Svitzer Hermod also features a Rolls-Royce Dynamic Positioning System. And is powered by a pair of MTU 16V4000 M63 diesel engines, each rated 2,000 kW at 1,800 rev/min. The vessel also features sensors that combine different data inputs using advanced software to give the captain an enhanced understanding of the vessel and its surroundings. The data is transmitted reliably and securely to a Remote Operating Center(ROC) from where the Captain controls the vessel.

www.rolls-royce.com

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Marine Salvage

arge shipping losses have declined by 50% over the past decade, mostly driven by the development of a more robust safety environment by shipowners, according to insurer Allianz Global Corporate & Specialty SE (AGCS). There were a total of 85 shipping losses reported in 2016, down 16% compared with a year earlier, says AGC’s fifth annual Safety & Shipping Review 2017. The number of shipping incidents (casualties) declined slightly year-on-year by 4% with 2,611 reported, according to the review, which analyzes reported shipping losses over 100 gross tons. “We continue to see improvements in maritime safety, but the price of safe navigation is constant vigilance,” says Captain Andrew Kinsey, Senior Marine Risk Consultant at AGCS. “The maritime sector is entering a period of considerable change and unrest from economic pressures, technology and political factors. There is a perfect storm of increasing regulation and narrowing margins.” More than a quarter of shipping losses in 2016 (23) occurred in the South China, Indochina, Indonesia and Philippines region – the top hotspot for the last decade. Loss activity there remained stable but was still almost double the East Mediterranean and Black Sea region (12), which was the next highest. Loss activity was also up in Japan, Korea and North China; the East African Coast, the South Atlantic, the East Coast of South America as well as the Canadian Arctic and Alaska maritime regions. Cargo vessels (30) accounted for more than a third of all vessels lost. Passenger ferry

32 Marine Log // July 2017

losses increased slightly (8), driven by activity in the Mediterranean and South East Asia. Standards remain an issue in some parts of Asia with bad weather, poor maintenance, weak enforcement of regulations and overcrowding contributing to loss activity. The most common cause of global shipping losses remains foundering (sinking), accounting for more than half of all losses in 2016, with bad weather often a factor. Over a third of shipping casualties were caused by

Negligence/poor maintenance is already one of the top causes of liability loss in the shipping sector.

machinery damage, which was also responsible for driving a 16% uptick in incidents in the East Mediterranean & Black Sea region (563), enough for it to replace the British Isles as the top incident location over the past decade. Safety-enhancing technology is already impacting shipping – from electronic navigational tools to shore-based monitoring of machinery and crew welfare. Technology has the potential to significantly reduce both the impact of human error—which AGCS

analysis shows accounted for approximately 75% of the value of almost 15,000 marine liability insurance claims over five years, equivalent to more than $1.6 billion—as well as machinery breakdown. Additionally, technology is instrumental in assisting with offshore crew health problems, which can often be difficult to address due to location. AGCS, together with Allianz Worldwide Care and Allianz Global Assistance, is now offering crew 24/7 access to medical advice through a dedicated app and on-board equipment. Such innovative telemedicine assistance services can help vessels make more informed decisions about a crew member’s health, potentially reducing the need to make costly route deviations. The threat of cyber attacks continues to be significant. Most attacks to date have been aimed at breaching corporate security rather than taking control of a vessel. As no major incident resulting from a cyber attack has taken place, many in the industry are complacent. “However, IT security should not be put on the backburner—if hackers were able to take control of a large containership on a strategic route, significant economic losses would occur,” says Captain Kinsey. The technology behind autonomous vessels is developing rapidly. Advancements in technology are also expected to enable ships to monitor their own health and the environment around them. “Autonomous technology has the potential to revolutionize the movement of cargo on a scale not seen since containerization was introduced some 50 years ago,” says Captain Kinsey. “Despite unknowns and regulatory issues, autonomous shipping will happen. Economic pressures on the shipping industry and the need to find efficiencies will support and speed up developments in maritime automation.” The collapse of one of the world’s largest shipping companies, Hanjin Shipping, over the past year exposed the perilous state of some parts of the sector. Bankruptcies are rising and when debt levels are high and earnings low, ship owners often seek to make cost savings from maintenance budgets, training and crewing levels, all of which can spike loss activity. According to AGCS, negligence/poor maintenance is already one of the top causes of liability loss in the shipping sector and an increase in maintenance-related claims is observed. Implementing rigorous inspection and maintenance regimes is crucial.

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