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Wednesday, May 06, 2009                                                                                               2009‐019

Maritime Press Collection     News reports taken from various internet news sites       Ship building News

Update on Japanese shipbuilding market Sunday, 03 May 2009     

The JSEA represents the major Japanese shipbuilders, including Mitsubishi Heavy Industries, Imabari, IHI, Mitsui, Universal, Kawasaki and Sasebo. Japan has been steadily losing market share for traditional ships over the last two decades to Korea and now to China. Japan has re-

sponded by focusing on higher tech vessels and high spec traditional ships. Japanese shipyards enjoy a virtual monopoly in building ships for domestic shipping lines. The numbers reported were for export vessels. While certainly not the numbers one would wish to publish, they actually tell a remarkable tale of resiliency. Competition yards in Korea and China have seen new orders virtually disappear since 1Q08, and have been fighting order renegotiations and cancellations. According to the JSEA, the combined order backlog in March of 2009 is at 1,312 ships versus 1,335 in March

2008. Any of the Korean or Chinese yards would love to have their backlogs show similar trends. Of course, have an order book and profitably delivering the vessels are not always directly related. Despite comparatively exceptional productivity rates, Japan remains the highest cost producer of the three major shipbuilding nations. Still, the numbers so far support the Japanese yards being in a better position to survive the coming prolonged weak shipbuilding market than their Korean and Chinese brethren. Source: Gerson Lehrman Group

Samsung, Daewoo Searching for Profit Monday, 04 May 2009       

Chief executive officers of Daewoo Shipbuilding & Marine Engineering (DSME) and Samsung Heavy Industries (SHI) are attending the offshore technology conference (OTC). And their participation appears to mean a lot. "Kim Jing-wan, the vice chairman of Samsung Heavy Industries, plans to hold a series of meetings with bigger oilrelated clients, which are close to placing new orders for offshore projects with shipbuilders," a spokesman for SHI

said, Monday. "Kim will raise the appeal of our technology to current and potential clients in a specially designated booth," he added. Ship orders have drastically evaporated since the second half of last year. Even the top trio in the global shipyards ― Hyundai Heavy Industries (HHI), Samsung and Daewoo _ have won almost no orders this year, the lone exception being an SHI deal in January for a $680-million "oil production unit." "It is highly unlikely that the global shipbuilding industry will turnaround within the second half of this year. But oil -related firms are still abundant in cash to push large-scale offshore projects," a Samsung spokesman said. The global shipbuilding industry has been suffering a drastic downturn as orders have screeched to a halt ― hit by a collapse in world trade and the financing woes of shipping companies. Shippers worldwide are idling their fleets, while order delays and cancellations are spreading from second-tier ship makers to the big players, making South Korea's leading shipbuilders find "alternative measures."

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News reports taken from various internet news sites       Ship building News Korea is home to the world's biggest shipyards ― HHI, DSME, SHI and STX Offshore & Shipbuilding. "With some 10 executives, the CEO of DSME Nam Sang-tae will himself meet the top officials of bigger ship owners and oil companies," a spokesman of DSME said. Attendees at this year's annual OTC are navigating hasher waters in their industry than when they last convened. "In certain economic times, attendees come to the OTC to find possible solutions that could reduce costs or

improve performance," the organizer's spokeswoman Margaret Watson said. Despite the difficult times, though, the four-day conference that opened Monday at the Reliant Center in Houston, Texas, will bring tens of thousands of energy professionals to get a glimpse of the latest technological advancements and hear about policy issues affecting the industry. HHI and STX are set to send their senior level officials to the show hoping to strike big deals in plant-related businesses.

The yearly conference comes amid increased debate about opening additional areas off U.S. shores for oil and gas drilling. HHI said that its first quarter net profit rose by 13 percent ― backed by foreign exchange gains from the weaker South Korean currency ― while DSME and SHI had defended their "bottom line," though the beleaguered economy had sapped demand. Source: The Korea Times  

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Maritime Press Collection / 2009-019

Wednesday, May 06, 2009 

News reports taken from various internet news sites       Ship building News

Austal wins second US Navy contract Tuesday, May 05, 2009     

Shares in Perth-based Austal jumped today after the shipbuilder announced it has won a second contract from the US Navy. The contract is for the construction of a Littoral Combat Ship (LCS) - the second LCS order granted to Austal from the US Navy. It could lead to further orders as part of the US Navy's demand for 55 vessels in its LCS fleet and, will boost employment at Austal's US shipyard to about 1300. In its announcement to the Austra-

lian Securities Exchange today, Austal said the Austal-designed and built ship will be constructed at its shipyards in Mobile, Alabama. It will be named "Coronado''. This follows two contracts for the design and construction of large commercial vehicle-passenger ferries which will be built at its WA shipyards. The second LCS ship for the US Navy will be identical to the 127m "Independence'' which is in its final construction stage at the US shipyard. Independence will start its sea trials over the next few months and be delivered late this year. Austal has been awarded about half of the $1.4 billion LCS budget. On top of this, it has also been selected as a contractor for the US Navy's Joint High Speed Vessel program. Austal says this project is valued at

more than $2.2 billion. "This contract award demonstrates a strong vote of confidence for the Austal-designed high-speed aluminium trimaran seaframe which has already proven itself in the commercial market,'' said Austal managing director Bob Browning. "With the US Navy's ongoing commitment to a 55-vessel LCS program - as part of its 313 ship fleet - we are confident that our superior design and purpose-built US construction facilities put us in a good position to meet this important requirement." Austal now plans to increase its workforce to more than 1300 when the LCS gets into full production next year. Austal shares last traded 9 cents or 3.49 per cent higher at $2.67. Source: news.com.au

Hyundai Heavy’s order predictions hit the buffers Tuesday, 05 May 2009       In the early weeks of 2009, Hyundai Heavy Industries predicted orders this year would reach $21.1bn - but by the end of the first quarter that figure already looks optimistic. Announced separately from its first quarter results, HHI revealed an order total for the first three months of 2009 of $1.9bn, 83% down year on year and less than 10% of the annual target. No orders for newbuildings were received during the quarter. In Seoul, BNP Paribas shipbuilding analyst James Yoon said that the low value of HHI's January-March orderbook was only the worst of a number of negative indicators to be found in the first quarter results. But a Hong Kong broker who wished to remain anonymous tried to see the bright side. He said: "Nobody should be surprised that the order figures for the first quarter were very low. Volumes can only go up from this point.

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News reports taken from various internet news sites       Ship building News But it remains to be seen if HHI will achieve the very optimistic target it has set for itself." Mr Yoon said: "Another disturbing point was the 20% [quarter-toquarter] drop in marine engine revenues due to order cancellations from China." Such pointers are the clearest example of how even the world's largest shipbuilder is being negatively impacted by the prevailing difficult market. Mr Yoon also highlighted HHI's deteriorating cash reserves. Cash in hand is becoming a problem even for giants of HHI's status, primarily due to a lack of new orders and vessel instalment payment deferrals. HHI's cash holdings in the first quarter fell to Won1.7trn ($1.3bn) from Won2.4trn in the fourth quarter of 2008, reflecting those vessel payment deferrals and overall lower profitability, provoking HHI into a Won300bn issue in April.

Despite turning in a 12.7% increase in net profit at Won498bn ($391.3m), Mr Yoon insists the results were far from positive. "On the surface, HHI's 1Q-09 results did not look so bad. However, underneath I don't believe the results were very positive," he said. "With the exception of construction equipment, all divisions exhibited strong growth year on year in sales revenue totalling Won5.3trn, but it represented a quarter-on-quarter decline of 9.2%. Mr Yoon said the sharp drop in operating profit by 26.3% and 30.2% on annual and sequential comparisons was "harsh". "Non-operating profit was weak as well due to lower operating profits, a 50% decline in interest income, a 66% decline in equity method gains and increased losses on derivative contracts of Won299bn after posting a slight gain of Won38bn in 4Q-08," he

said. Mr Yoon said the market was disappointed to see operating margin drop 2.6% quarter-to-quarter to 8.6% based on higher priced steel plate inventories being reflected in earnings. "The shipbuilding division operating margin was much worse than the overall company margin. Also the positive impact of a one-off change order which increased margins in offshore and plant divisions in 4Q-08 was absent in 1Q-09. It seems that this may have had the biggest negative impact on operating profits compared to 4Q-08," he said. Mr Yoon concluded: "Despite arguments that HHI has a diversified business structure, the comments from management reflect that all heavy industrial sectors are moving in the same general downward cyclical direction. Of course the worst news was the $1.9bn in new orders." Source: Vinamaso.net

WORLD SECOND LARGEST OFFSHORE HAVY CARRIER

Offshore Heavy Transport AS (OHT) Tel. 82 51 463 8250 Email: info@ohtkr.com www.oht.no

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Maritime Press Collection / 2009-019

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News reports taken from various internet news sites       Ship building News

Keppel cancels new orders Monday, 04 May       Keppel Corp has been forced to cancel a newbuilding order worth SGD181m ($122m) after the owners failed to finance the project. The Singapore yard said it had received a notice from Romanian company GSP Titan to terminate the shipbuilding contract. Keppel said the cancellation was due

to the owner's difficulties in securing project financing as a result of the current tight credit situation. Contracted to Keppel Singmarine in late July 2008, the newbuilding project is at its early stages of execution, Keppel said. "Keppel Singmarine has received milestone payment for the project

which covers costs incurred on the project as well as the expected loss of profit," it added. GSP, which is part of the privatelyowned Upetrom Group, had planned to deploy the vessel in the Black Sea and Mediterranean region Source: Vinamaso.net

Keppel Shipyard

Bharati Shipyard Looking for Defense Orders Tuesday, May 05, 2009  Bharati Shipyard Ltd. is looking for more orders from India's defense sector to maintain its revenue growth, the privately operated ship builder's managing director said. ""At the moment we have defense orders for small patrol vessels worth about 3 billion rupees ($60.1 million),"" P. C. Kapoor told Dow Jones Newswires after the company re-

leased its results Wednesday. ""We are negotiating for more such orders totaling about 4 billion rupees to 5 billion rupees."" The company will start delivering the vessels under the current orders after 15 months and complete the work over the next three years, Mr. Kapoor said. He declined to say how much time will it take to get the new con-

tracts. India is expected to issue contracts valued at as much as $60 billion by 2015 for equipment and systems to modernize its mainly Soviet-vintage defense forces. Several overseas companies are forging alliances with Indian companies to jointly bid for big defense contracts as they need to meet localsourcing requirements. Domestic

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News reports taken from various internet news sites       Ship building News companies are also expected to win orders on their own. Bharati Shipyard had a total order backlog worth 50.94 billion rupees as of March 31 which will be executed over the next few years, Mr. Kapoor said. Mumbai-based Bharati Shipyard makes cargo and container ships, tankers, dredgers, fishing boats, as well as other vessels such as those for coastal patrolling. For the fiscal year ended March 31, Bharati Shipyard posted a 20% rise in

net profit from a year earlier at 1.30 billion rupees. Its revenue grew nearly 46% to 9.34 billion rupees during the period. ""We are going to make our performance grow at the same pace"" in the current financial year, Mr. Kapoor said. Bharati Shipyard also wants to start offering services to offshore oil and gas fields, he said. ""At the moment it is at the planning stage, and we are in search for a U.S. partner"" to enter the business.

He said the partner should be an offshore services provider, but declined to give details. The company has orders worth 12 billion rupees to build vessels for Great Offshore Ltd., Mr. Kapoor said. Bharati Shipyard holds nearly 15% of Great Offshore's outstanding shares, which were pledged by the offshore services provider to take loans. It will continue to hold the pledged shares, but there is no plan increase the holding, Mr. Kapoor added. Source: Wall Street Journal

Halliburton to Launch Unique Next Generation Stimulation Vessel Offshore West Africa Tuesday, May 05, 2009 HOUSTON - Halliburton's (NYSE: HAL) Completion and Production Division is launching a next generation stimulation vessel, the Stim Star Angola, in response to operators' needs for stimulation treatments on offshore West Africa assets. The new vessel will serve as a high performance platform for delivering technology and helping reduce rig downtime and associated costs for operators. "We are committed to meeting the needs of operators in the Offshore Angola Region, one of the premier deepwater basins on the globe," said Marc Edwards, vice president of Production Enhancement, within Halliburton's Completion and Production Division. "With the new Stim Star Angola stimulation vessel, op-

erators will have cost-effective access to all phases of production stimulation including acidizing, fracturing, sand control and conformance solutions for this developing deepwater market." The new vessel was designed to help minimize rig downtime. Certified for DP2 dynamic positioning, the Stim Star Angola will be capable of working in difficult sea conditions in deepwater locations at tension leg platforms, drill ships, large semisubmersibles, or single wellheads. Cycle time will be minimized by the vessel's proppant, acid and liquid additives capacity, which permits loading sufficient material for multiple treatments, reducing trips to the dock. Cycle time will also be reduced by using the vessel's onboard crane and

water maker system. The vessel is uniquely capable of delivering specialized fracturing and acidizing treatments supported by the latest Halliburton technology developments, including for example, the patented SurgiFrac® service for fracturing deviated and horizontal wellbores. In keeping with Halliburton's commitment to outstanding health, safety and environmental performance, the Stim Star Angola is engineered to meet or exceed all regulatory requirements enabling the vessel to operate in any international location. The Stim Star Angola will be available by the third quarter of 2009 and will be based in Soyo, Angola. Source: Halliburton

Guangzhou Shipyard profit falls 50% on plate prices Tuesday, May 05, 2009 Guangzhou Shipyard International Co., a unit of China's biggest shipbuilder, said first-quarter profit fell 50 percent because of higher prices of steel plates. Net income for the three months ended March 31 declined to 129.3 million yuan (US$18.9 million),

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News reports taken from various internet news sites       Ship building News or 0.26 yuan a share, from 258 million yuan, or 0.52 yuan, the company said in a statement to the Shanghai stock exchange. "They may still be using some of the high-priced inventory acquired in the middle of 2008 when steel prices were high," Jack Xu, a Shanghai-based analyst at Sinopac Securities Asia Ltd., said before the announcement. "The company had a very good first quarter in 2008, which makes the comparison tough."

Guangzhou Shipyard also incurred higher financing costs during the period as it received fewer orders, according to an April 9 exchange filing. Orders placed with Chinese shipbuilders plunged 94 percent in the first three months, according to government estimates, as a global recession erased demand for ships to carry raw materials and consumer goods. The Guangzhou, southern Chinabased company completed and deliv-

ered four vessels, the statement said. It secured orders for building 60 vessels, with a Total tonnage of 2.66 million deadweight tons, it said. Chinese shipyards may have cash shortages of about US$30 billion in the next three to four years, the China Daily reported on April 8, citing Li Li, a deputy general manager of ExportImport Bank of China's ship finance department. Source: Etaiwan News

Ancient Motor Vessels "Midthordland" 

New US$150mil shipping fund by year end Wednesday, 06 May 2009   SFS Group Public Co Ltd and Kuwait Finance House Labuan (KFHL) will jointly establish a Shariah compliant shipping fund with a target fund size of US$150mil by year-end. SFS Group and KFHL , a wholly owned subsidiary of Kuwait Finance House (M)

Bhd have signed a joint venture agreement to set-up the fund via a limited partnership in the Cayman Islands. The companies said in a joint statement on Tuesday that the fund would be managed by an equally-owned company acting as the general partner based there. The shipping fund’s objective will be

to invest directly in shipping assets and primarily in vessels to be chartered out on a long-term basis to top league charterers. The term of the fund will be seven years from first closing with up to three additional one-year extensions. Source: The Star

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Maritime Press Collection / 2009-019

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News reports taken from various internet news sites       Shipbuilding News

India: Mouth of Narmada turning into shipbuilding hub Tuesday, 05 May 2009  

The estuary of Narmada river, considered lifeline of Gujarat, is all set to become the lifeline for shipbuilding activities of India. In a move with farreaching consequences, the Gujarat government has decided to develop the 12-km stretch south of Dahej - at the point where the Narmada river meets the Gulf of Khambhat - as a Marine Shipbuilding Park (MSP), first of its kind in the country. A Rs 1,000-crore Gujarat Maritime Board project for developing common infrastructure facilities for shipbuilders is ready. While two shipyards ABG Shipyard and Shoft Engineering Shipyard - already exist here, officials said at least a dozen shipyards are proposed to be set up, each with an investment ranging from Rs 300 crore to Rs 1,200 crore. The northern bank of Narmada estuary

offers nearly 10-metre deep draft during high tide, good enough to build big ships with up to 10,000 dead weight tonnage (DWT). A senior bureaucrat said, “With the decision to move the Kalpasar dam north of Dahej, shipbuilding activities have become viable. Had Dahej and Narmada river remained within the Kalpasar reservoir, developmental activities would not have been possible. Even the other bank of the Gulf of Khambhat - the Bhavnagar coast which too is now out of Kalpasar’s new design - will also be developed to build smaller ships. Gujarat chief secretary D Rajagopalan has been pressing ahead with the idea of developing shipbuilding clusters like the ones in South Korea, China, Japan and Indonesia. Currently, India accounts for

just one per cent of shipbuilding activities in the world. With the decision to develop MSP, Gujarat may well fulfil the Government of India’s shipbuilding policy perspective of taking it up to 10 per cent. ABG Shipyard is planning to expand its activities in the estuary with an investment of Rs 800 crore. The proposals now under implementation include Walchandnagar Industries for Rs 300 crore, Tebma Shipyard for Rs 1,000 crore, Dahej Shipyard for Rs 1,200 crore, Jindal Shipyard for Rs 1,000 crore, and Assam Company for Rs 750 crore. Official also believe that the MSP would facilitate movement of cargo to different places in India via sea route, which is often cheaper. Source: The Times Of India

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News reports taken from various internet news sites       Offshore News

Technip wins Daniel Boone deal 5/5/2009  

HOUSTON, TEXAS: Technip has been awarded a contract by W&T Offshore Inc. (NYSE: WTI) for the

Daniel Boone field development in the Gulf of Mexico. The field is located in Green Canyon Block 646, in a water depth of 4,230 feet (1,349 m). The field will be tied back to the Front Runner Spar. The contract covers engineering, fabrication and installation of a 23mile (37-km) rigid production flowline terminating at the spar with a flexible riser; design, fabrication and installation of an in-line structure and PLET; and engineering and installation of a 23-mile (37-km) long umbilical, jumper and flying leads.

Technip's operations and engineering center in Houston is executing the contract. The flowline has been welded at the Group's spoolbase in Mobile, Ala. The riser was fabricated in at Technip's Le Trait, France, flexible pipe plant. Offshore installation is scheduled for the second quarter of 2009, using the Deep Blue, Technip's deepwater pipelay vessel. First production from Daniel Boone is expected to be in the second half of 2009. Source: Energy Current

Petrobras gets UK credit line Tuesday, 05 May, 2009,  The UK Export Credit Guarantee Department (ECGD) is set to follow in the footsteps of US and Canadian counterparts by opening up a credit line with Brazil’s Petrobras, understood to be in the region of $750 million. The outline of the loan deal is already in place and is understood to be close to conclusion. Petrobras financial director Almir Barbassa told Upstream last week that he and other company officials will shortly travel to the UK to promote investment opportunities in the Brazilian offshore sector, following a similar roadshow, recently taking in South Korea, Singapore and Japan. The objectives of the roadshow go beyond merely signing the $750 million deal, and extend to efforts to attract investments to a Brazilian shipyard expansion and rig-building programme. The pioneering event of this type was a Norwegian roadshow in January, led by Petrobas head Jose Sergio Gabrielli. The event is helping to stimulate a raft of export credit arrangements for mainly Brazilian companies building rigs for Petrobras.

The oil company has also made its own financing deals directly with ECA’s and announced a $2 billion loan through the US Ex-Im Bank facility last week, earmarked for the acquisition of equipment and services for the oil industry. Earlier this year, Petrobras sealed a $500 million 12-year loan from Export Development Canada. Petrobras unveiled a $174.4 billion investment plan in January, drawing heavily on working capital and credit from government-owned banks, but also leaving an $18 billion fiancing gap through next year, which is fast being filled. Petrobras boss Gabrielli recently said the company has raised about $6 billion in loans and debt this year, but made his comments before the US Ex -Im Bank credit deal was announced. He has stated that export credit from a wide range of countries will play an increasingly important part in financing the company’s investments, with the Danish and South Korean facilties also names as possible sources. Petrobras is also negotiating loans of up to $10 billion with China Development Bank, linked to rights of first

refusal on crude supplies. Upstream

Source:

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News reports taken from various internet news sites       Offshore News

Petrobras awards first FPSO classification contract to DNV 5/5/2009  

HOUSTON, TEXAS and RIO DE JANEIRO: Petrobras and DNV today signed a classification contract for the floating production storage and offloading vessel (FPSO) P-58. The contract with Petrobras is for classification services for a VLCC tanker conversion into an FPSO, to

be named the Petrobras-58, or simply P-58. The P-58 will be the first Petrobras-owned FPSO to be classed by DNV. P-58 will operate in Parque das Baleias' north fields in the Campos Basin offshore in Espírito Santo's south coast. The unit will be spread moored in a maximum water depth of 4,593 feet (1,400 m). The unit will be designed for at least 25 years of uninterrupted operation without the need for dry-docking. The process plant will handle production and treatment of 47,700 m3/ day (1.6 MMcf/d) of liquids, 28,620 m3/day (1.01 MMcf/d) of crude oil, will have gas compression capacity of 6,000,000 m3/d (211.9 MMcf/d) and de-sulphated water injection capacity of 57,500 m3/day (2.1 MMcf/d).

Oil production will come from 19 satellite wells connected individually to the unit. Water will be injected into 10 satellite wells. The classification contract for the conversion phase will last for 56 months and includes the design review of the basic design, FEED [front-end engineering and design] contract, detailed design, hull conversion survey, modules fabrication survey, integration and offshore commissioning. The classification services will mainly be carried out by DNV in Brazil, since the design and most of the conversion work will be performed locally. Source: Energy Current

Upbeat mood seen at OTC despite downturn 5/5/2009

HOUSTON, TEXAS: A year ago, with oil prices above $100 and the economy still growing, Houston's Offshore Technology Conference reflected the swagger and optimism of one of the biggest booms ever for the oil and gas industry. At this year's event, the scene is different. Not only are crowds off from 2008's near record levels, the heady mood is mostly gone as the industry grapples with uncertainty on many economic and policy fronts. As one speaker put it in a panel dis-

cussion Monday, the industry's onward-and-upward spirit of the past several years has been "shattered." But many speakers and attendees said, despite challenges, they are trying to keep a long-term view of an industry that's been through many downturns before. "We certainly don't like it, but it's something that the industry is getting better at as time goes on," said Luc Messier, a senior vice president with Houston-based ConocoPhillips. The event, which kicked off Monday, is one of the world's largest gatherings of offshore oil and gas industry professionals. Drilling rigs and other exhibits, for instance, cover the space of more than 10 football fields this go-round, the show's 40th year. But pre-registration numbers suggest attendance at the 2009 event will be closer to 2007 levels, when visitors hit 67,000, OTC spokeswoman Mar-

garet Watson said. Last year, the event attracted more than 73,000, the highest since 1982. Swine flu warnings kept away some delegates, most notably a contingent of executives from Brazil's national oil company Petrobras. But U.S.based employees stood in, and no other major cancellations had been reported as of Monday, Watson said. OTC comes amid a global recession that has pushed down oil and natural gas prices by more than two-thirds from last year's peaks. The sharp drop has forced many oil companies to cut jobs and put projects on hold, including costly deepwater offshore drilling programs that have been a focus of recent OTC shows in recent years. Adding to worries are moves by Congress to consider sweeping legislation to limit greenhouse gas emissions, an effort the industry fears will add massive costs.

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News reports taken from various internet news sites       Offshore News Communication problems Both topics were front and center in panel discussions and technical papers, as well as on the minds of many attendees. In the morning, a panel including Shell Oil Co. President Marvin Odum and U.S. Rep. Sheila Jackson Lee, DHouston, discussed the need for greater communication among constituent groups in crafting energy policy that increases energy supplies while respecting the environment. "We need to get away from this conversation around demonizing the oil and gas industry," Odum said. "It's

not helpful to anybody." In an afternoon panel, industry leaders stressed the need to keep investing in oil and gas production despite the present downturn. Oil companies also groused that costs of services like drilling have not come down as fast as oil prices. Yet, on the exhibit floor, exhibitors were largely upbeat. of the world are spending like oil is still $147 per barrel, said David Meehan, marine and offshore products market manager at National Oilwell Varco, a Houston-based supplier of oil and gas equipment. This includes Brazil and Middle East

liquefied natural gas projects. Ricky Simic, vice president of business development at Arlington-based oil service provider Oil States Industries, said his company got a few quality business leads at its booth Monday morning, despite what appeared to him to be thinner crowds. Oil States also remains busy with work amid the industry downturn, which has given him some hope about the future. "I don't think we're quite at the bottom with the economy," he said, "but I'd like to think it's close." Source: YellowBrix

Marathon awarded third Indonesian block 5/5/2009  

Cidade de Niteroi MV18  MODEC FPSO Cidade de Niteroi MV18 on voyage..

JAKARTA: Marathon Oil Corp. (NYSE: MRO) subsidiaries Marathon Indonesia New Ventures Ltd. and Indonesia Kumawa Energy Ltd. entered into a Production Sharing Contract with the Indonesian government for a combined 49 percent interest in the Kumawa Block offshore Indonesia. Marathon's co-bidder, Komodo Energy LLC, a subsidiary of Black Gold Energy LLC, was awarded the remaining 51 percent interest. Marathon Indonesia New Ventures Limited will serve as the operator. The Kumawa Block encompasses approximately 1.24 million acres and is located offshore the province of West Papua, in the Semai region, approximately 180 miles (289 km) south of the recently commissioned Tangguh liquefied natural gas facility. The Kumawa Block is a high-potential, under-explored area with water depths ranging from 2,400 feet (731 m) to more than 4,000 feet (1,219 m). "Marathon is pleased to further strengthen its exploration program in Indonesia with the award of the Kumawa Block," said Annell R. Bay, Marathon's senior vice president, worldwide exploration. "This is an important step in the continued growth of Marathon's portfolio of large-scale, high-potential blocks in the country." Current exploration plans for the Kumawa Block call for the acquisition of 2D seismic followed by drilling operations. Another Marathon subsidiary, Marathon International Petroleum Indonesia Ltd., holds a 70 percent interest and operatorship in the Pasangkayu Block located predominantly in the Makassar Strait offshore Sulawesi Island and directly east of the prolific

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News reports taken from various internet news sites       Offshore News Kutei Basin oil and gas production region. The Pasangkayu Block covers 1.2 million acres ranging from onshore Sulawesi to water depths of up to 7,200 feet (2,194 m).

Marathon Indonesia (Bone Bay) Ltd., a separate Marathon subsidiary, also holds a 49 percent interest and operatorship in the Bone Bay Block which covers 1.23 million acres lo-

cated 200 miles (321 km) southeast of the Pasangkayu Block in water depths ranging between 165 feet (50 m) and 6,500 feet (1,981 m).

China yard Dalian wins $500M Tupi job May 4, 2009   

The giant Tupi oilfield offshore Brazil will get its giant floating production facility next year, after Japan's Mitsui Ocean Development & Engineering Co., or MODEC, on Monday awarded Dalian Shipyard Co. the job of converting its supertanker for. Singapore-based COSCO Shipyard Group, indirect majority owner of the Chinese yard Dalian, said the 18-year -old very-large crude carrier VLCC Sunrise IV will become an FPSO, or floating production storage and offloading vessel, for MODEC. The conversion is understood to cost over $500 million, judging from other conversions, and the contract involves repair, topside integration and commissioning. The vessel is set for final delivery in mid-2010.

The Tupi FPSO is designed to operate for 20 years without dry-docking and can produce 100,640 oil per day, 5,000,000 cubic metres of gas per day while storing 1,600,000 bbls of oil. The capacity confirms Brazilian energy champion Petrobras statements of last year promising pilot production in late-2010 of 100,000 bpd, 10 percent of what BG chief exec Frank Chapman said was eventually possible at the offshore trove. On Friday, BG announced first commercial oil from the Santos Basin field license BM-S-11, where another FPSO, the BW Cidade de Sao Vicente is already in production. A second well in the permit, Tupi P1, is planned for June 2009 and will be tied back to the same FPSO.

The current extended well test on Tupi is expected to last 15 months and is seen reaching 15 000 bpd. The Tupi field is operated by Petrobras with a 65-percent stake. BG Group holds a 25-percent stake and Galp Energia a 10 percent. The South Atlantic ocean at Tupi is 2,500 metres deep. Tupi is believed to contain up to eight billion barrels of oil and oil equivalent and has been reported in detail by Scandoil.com since its discovery late in 2007. Scandoil.com affiliate Scandinavian OilGas Magazine has featured Tupi in deepwater coverage of past issues. Source: Scandoil.com

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Maritime Press Collection / 2009-019

Wednesday, May 06, 2009 

News reports taken from various internet news sites       Shipping News

US Shipping reveals bankruptcy plan Tuesday, May 05, 2009 

US shipping Partners' proposed bankruptcy protection plan is designed to allow the company to remain in business during a comprehensive restructuring and reduce its leverage and improve liquidity. The company's principal lenders will gain equity control over the company as it reorganises. It remains to be seen how the US

bankruptcy judge treats the company's plan, especially in light of the dispute between US Shipping and its joint venture partner Blackstone Group. US Shipping said the "consensual" nature of its proposed reorganisation plan would enable the company to emerge from bankruptcy as a viable enterprise by the end of the third quarter. The Chapter 11 papers state that more than two thirds of the Jones Act tanker company's first and second lien lenders have endorsed the proposed plan. Under this pre-arranged bankruptcy protection plan, the company's $332m in senior credit facility debt, a first lien amount, will be maintained

at that level, but with a lower rate of interest. However, these lenders will receive a 50% share of the equity in the reorganised company in return for this accommodation Of the second lien amounts, $100m is to be converted into the other 50% equity share of the reorganised company. US Shipping will be able to hold on to its $15m cash balance through the bankruptcy period. The company has put in place a structure to "incentivise and retain incumbent management" via equity. This has taken the shape of promising executives up to 10% of the company's shares after it emerges from bankruptcy. Source: Vinamaso.net

Zeebrugge aims at world first for LNG trade terminals Tuesday, May 05, 2009  Zeebrugge could become the first liquefied natural gas terminal in the world capable of accepting both conventional tonnage and the more novel regasification vessels following an agreement between gas shipping specialist Exmar and terminal operator Fluxys. Exmar has been working on plans to use Zeebrugge as a discharge terminal for the company's regasification vessels for about two years. Now, Fluxys, which operates the Zeebrugge LNG terminal, has agreed to undertake a detailed study into building a second jetty with the aim of enabling regasification vessels to moor. For its part, Exmar said it was pre-

pared to book long-term capacity with Fluxys. Under the memorandum of understanding between the two companies, the study will also assess the pipeline and ancillary infrastructure needed to allow the injection of gas into the

Fluxys transmission network. Exmar chief executive Nicolas Saverys said Zeebrugge was an attractive discharge port because gas can be moved in any direction: to the Zeebrugge hub short-term market, to the Belgian market, to all

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News reports taken from various internet news sites       Shipping News neighbouring markets and to markets further afield. "This makes Zeebrugge an outstanding location for our regasification ships to unload," he said. "The flexibility of our regasification ships is a huge asset, enabling us to respond very quickly to market signals." Fluxys commercial director Pascal

De Buck said the company expected twice as many ships to discharge at the terminal in the first half of this year compared with the corresponding period of 2008. "This is partly the result of the terminal's first capacity enhancement last year," he said. "A second jetty again would serve as an attractor for additional LNG shipping traffic."

Regasification vessels can inject gas directly into the gas transport grid or pump LNG to storage tanks onshore. Almost two years ago Exmar applied for permission to build a ship-to-ship transfer installation for LNG and high-pressure natural gas in Zeebrugge. Source: Lloyd’s list

Baltic Dry Index on the rise again Wednesday, 06, May 2009 Volatility is the key word for the trials and tribulations of the Baltic Dry Index and consequently all ship owners involved in the dry bulk trade. The BDI, a gauge that reflects the cost to haul iron ore, coal, grains and other raw materials via ships, edged up higher yesterday to reach 1,897 points, gaining 91 points from the previous session. It had gained a further 1.1 percent or 20 points last Friday, before a break on Monday. Leading analysts keep pointing out that the course of the BDI should be closely monitored as an indication of the world economy’s rebound. But the fact remains that even if this well-

sought rebound arrives, whether that will be at the end of the year, or at the first months of 2010, the BDI could still be plagued by another crucial factor. That is of course the potential oversupply of bulk carriers, which is expected to hinder the freight market’s possible rally back at healthier levels and definitely more sustainable for most ship owners. For the moment, the index remains at very low levels. That said, the main winners from yesterday’s upward swing, were the bigger vessel types, with the Capesize Index reaching 2,528 points (up by 152) and the Panamax Index standing at 1,702 (up by 146). Despite this, earnings for panamaxes remain below the smaller Supramaxes. A panamax can average $13,658 on a daily time-charter rate, while a supramax can reach up to $14,952 on average. The relevant daily average rate for a capesize, once

the “golden goose” of the market, now stands at $23,744, almost a tenth of the earnings it could fetch almost a year ago. 'Steady steel prices have supported rates' for capesizes, Omar Nokta, an analyst at Dahlman Rose & Co in New York, wrote in a note on Friday. 'The panamax market has benefited from a surge in activity levels during the past few days and rates continue gaining.' Iron ore is the biggest single dry-bulk cargo hauled at sea, accounting for an estimated 26 per cent of the total this quarter, according to Drewry Shipping Consultants in London. Capesize forward freight agreements this quarter, used to bet on future shipping rates, dropped 5 per cent to US$20,925 a day in Oslo. Panamax FFAs slid 4.1 per cent to US$11,875 a day. The data are from broker Imarex NOS. Source: Hellenic Shipping News

Paris and Tokyo MOU's hold joint concentrated inspection campaign on lifeboat launching arrangements Wednesday, 06 May 2009  The 43 Maritime Authorities of the Paris and the Tokyo Memoranda on Port State Control will begin a joint concentrated inspection campaign with the purpose to ensure compliance with SOLAS Chapter III – LifeSaving Appliances and Arrangements

with regard to lifeboat launching arrangements. This inspection campaign will be held for 3 months, ending on 30 November 2009. In practice the concentrated inspection campaign will mean that during every port State control inspection within the

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News reports taken from various internet news sites       Shipping News Paris and Tokyo MoU regions, the lifeboat launching arrangements, maintenance records and other applicable documentation shall be verified in more detail for compliance with SOLAS Chapter III. Port State Control Officers (PSCOs) shall use a list of 20 selected items to verify critical areas for the safety of lifeboat launching arrangements, some of which are related to documentation, equipment and familiarisation.

For this purpose PSCOs will apply a questionnaire listing a number of items to cover this concentrated inspection. The questionnaire will be published on the websites of Paris MoU and Tokyo MoU in the first week of August 2009. When deficiencies are found, actions by the port State may vary from recording a deficiency and instructing the master to rectify within a certain period to detention of the ship until deficiencies have been rectified.

In case of detention publication in the monthly list of detentions available on the Paris MoU and Tokyo MoU web pages will take place. It is expected that the Paris MoU and Tokyo MoU will carry out approximately 10,000 inspections during the CIC. The results of the campaign will be analysed and findings will be presented to the governing bodies of the MoU’s for submission to the IMO. Source: Paris MOU, Tokyo MOU

BOCOM offers 30 bln yuan loans to China Shipping Wednesday, 06 May 2009   China's Bank of Communications signed a comprehensive cooperation agreement with China Shipping (Group) Co. Tuesday, deciding to provide credit loans of 30 billion yuan to the latter. According to the agreement, BOCOM and China Shipping will set up to a long-term relationship for strategic cooperation. The two sides will now begin cooperating on cash management, investment banking, and private financial services to boost the development of the large shipping enterprise and facilitate in the establishment of Shanghai Municipality as an "international shipping center." Shanghai headquartered China Shipping is a large comprehensive multinational and multiindustrial enterprise. It's one of the key stateowned enterprises directly under the central government. Source: Xinhua

Hyundai Launches Two U.S. Services        Wednesday, 06 May 2009   Connections to China through Panama, Suez start in May, reach U.S. in June Hyundai Merchant Marine will introduce two services in May and June, connecting China to the U.S. East Coast. The China Savannah Express (CSX) and the South China New York Express (SNX) will both carry refrigerated and dry containers. The CSX connects China and Busan, Korea to the U.S. East Coast via the Panama Canal deploying eight vessels with an average capacity of 3,800

twenty-foot-equivalent units. The first vessel, the CMA CGM Georgia, arrives in Ningbo on May 10. Its first U.S. call will be in Savannah, Ga. on June 6. The rotation is as follows: Ningbo, Shanghai, Qingdao, Busan, Panama Canal, Savannah, New York and Miami. The South China New York Express (SNX) connects Hong Kong, China and Malaysia to the U.S. East Coast via the Suez Canal deploying fourteen

vessels with an average capacity of 6,000 TEUs. The Maersk Kolkata starts its maiden voyage as the first vessel in the service in Shanghai, China on May 14 and arrives in New York on June 12. The rotation is as follows: Shanghai, Hong Kong, Yantian, Tanjung Pelepas, Suez, New York, Norfolk, Savannah, Tanjung Pelepas, Hong Kong, Yantian and Shanghai. Source: The Journal of Commerce

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Maritime Press Collection / 2009-019

Wednesday, May 06, 2009 

News reports taken from various internet news sites       Shipping News

Sri Lanka moves to win ship lay-up business Wednesday, 06 May 2009  

Sri Lanka is trying to position itself to attract the growing ship lay-up business triggered by the global economic slump and has earmarked safe anchorages for vessels, a senior Sri Lanka Ports Authority (SLPA) official said. "We have got clearance from the security authorities now to lay up vessels in safe anchorages outside Colombo harbour," said SLPA managing director Nihal Keppetipola. "We have been having several requests from shipping lines on the possibility of laying up their ships in our anchorages."

The SLPA is also holding talks with the defence authorities on using the eastern port of Trincomalee for laying up ships. Trincomalee, one of Asia's biggest natural harbours, was used for ship lay-up during down turns in the shipping market before the outbreak of the ethnic war in the early 1980s. Shipping industry officials said the country can earn fees for laying up vessels and also providing services to maintain the ships until they are recalled for service when the market recovers.

The demand for ship lay-up arose with the collapse in the shipping market caused partly by the global economic crisis which has reduced trade and partly by a huge oversupply of vessels. Shipping lines seek to lay up their vessels when it becomes uneconomic to operate them when the slump in the market hits earnings because of reduced demand, delivery of new vessels and fewer ships being scrapped. The worst hit by the downturn were container ships and bulk carriers with tankers also now getting affected because of the lower oil market. With charter rates plunging and earnings poor, loss-making shipping lines are scrambling to pull ships out of the market and lay them up until the market recovers. The over supply situation arose because of a heavy bout of ordering in recent years during the boom in shipping. Some container lines now have almost a quarter of their ship capacity in lay-up with the average figure being nine percent for the top 24 container lines. The situation is so bad that some newly built vessels are heading straight for lay-up. Countries like Malaysia have been successful in promoting some of their anchorages for ship lay-up. Source: LBO

Saudi Arabia Reduces Light Crude Prices for U.S. Wednesday, 06 May 2009   Saudi Aramco, the world's largest state-owned oil company, cut its official selling prices for exports of light crude oil grades to the U.S. in June. Northwest European prices were raised. Saudi Arabia lowered the price of its Extra Light crude the most, cutting it by $1.15 a barrel to $1.95 below the cost of West Texas Intermediate crude, the state oil company said in a faxed statement today. The price of Light crude dropped 70 cents to $2.95 a barrel below WTI, while the Medium crude price fell 25 cents

to a $4.10 a barrel discount. Heavy crude exports were left unchanged at a discount of $4.85. U.S. crude oil stockpiles are at the highest since 1990 as the recession saps fuel demand. Last year's production cuts by the Organization of Petroleum Exporting Countries have failed to reduce the over-supply of oil and the group will meet again May 28 to decide whether to trim supplies further. In contrast to U.S. prices, Saudi Aramco increased the cost of exports to northwest Europe. The price of

Heavy crude was raised the most, by $1.50 to a discount of $4.30 below a weighted average of Brent crude, posted by Intercontinental Exchange. Extra Light exports to northwest European customers were increased 60 cents to a $2.10 discount, Light crude by $1.25 to $2.80 below Brent and Medium crude by $1.15 to a discount of $3.85, Aramco said. Source: Bloomberg

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Wednesday, May 06, 2009 

News reports taken from various internet news sites       Shipping News

Philippines keen to revive shipyards Tuesday, May 05, 2009  Manila: Shipping regulator Maritime Industry Authority (Marina) is set to issue several circulars to revive the country’s shipbuilding sector, which has been stagnant for the past decades. During its board meeting in March, Marina has approved several circulars that now include not only the shipbuilding sector but also the ship repair, ship breaking, and other boat-building companies. One of which is Marina Circular 2009-06, which requires shipyards to have license plates, which will be handed out by Marina starting June this year. “The license plate shall have a validity of nine years, which shall correspond with the expiry date of the entity’s certificate of registration,” Marina said in its circular. Marina said it would sell the license plate to covered entities at no more than P500. Lack of license plate after June 1 will have a corresponding penalty of

P5,000 and a 30-day suspension of the license for the first offense, and P10,000 and revocation of license for the second day. Marina is also mulling over the release of a circular for small boat repairs and boat building, but a copy of which was not made available to the media as it has not been published yet in a newspaper of general circulation. Earlier, Marina recommended Subic Bay, Bohol and Malita municipality in Davao del Sur as the priority areas for the establishment of the country’s shipyards. Marina said in its report that it is in coordination with the Philippine Economic Zone Authority (Peza) and the Board of Investments (BOI) to declare the three cities and municipalities as priority areas where shipyards “can be located and concentrated.” “Such areas may be declared as ecozones [economic zones] wherein

operations of the shipyard shall be registered with the BOI in order to reduce operating costs through incentives provided,” Marina said. Of the three areas, only Subic Bay has already its own shipyard, including the one operated by Hanjin Heavy Industries and Construction Co. Ltd. Peza, on the other hand, has its Subic Shipyard Special Economic Zone in Cabangan Point in Cawag, Subic. The other two areas are still working out the construction of their own shipyard. Source: Seatrade Asia Online

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Miritime Press Collection  

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