Demand for Offshore Vessels:

Susan Buchanan (taken from April 2012 print edition of MarineNews)
Friday, April 13, 2012
Activity in the Port of Lafourche, LA.

Growing In Deepwater Gulf of Mexico.
 

  • GOM SITREP


As the feds issue more drilling permits for the Gulf, demand for offshore support vessels in the GOM deepwater sector has accelerated, industry members say. Anger about the government's spill-related, drilling moratorium--which ended a year and a half ago--has given way to optimism recently. The region's shallow-water sector, nevertheless remains slow and gives little cause for cheer.
 

Paul Candies, president and chief executive of Otto Candies, LLC, in Des Allemands, La., said “we're seeing good demand for large, high-quality OSVs now and for the next couple of years. The industry has seen the value of first-rate equipment--OSV and Construction/Dive Support/ROV vessels--and is willing to commit to some long-term contracts.” But he added “we're not seeing much improvement in demand for midsize and small equipment.” Otto Candies is a marine transportation and offshore services company.

 

  • Taking Stock:
     

What's behind the renewed need for deepwater vessels? Don Briggs, president of the Louisiana Oil and Gas Association, said “We've slowly, surely gotten back to work in Gulf. We're not at pre-Macondo levels yet but we're coming back. Today's count in the GOM is 43 rigs and that's up from 25 a year ago,” he said in late March. However, that compares with 148 rigs in 2001.
Chett Chiasson, executive director of Port Fourchon in Louisiana, said the government has been approving more drilling permits, and “BSEE, the Bureau of Safety and Environmental Enforcement, anticipates another ten rigs will be operating in the Gulf by the end of this year. That's good news for vessels.” Port Fourchon services 90 percent of all U.S. Gulf deepwater projects. Chiasson continued, “Activity at Port Fourchon started to improve at the end of last year and has continued to get better. Port activity is 90 percent of what it was prior to the moratorium and that number is constantly rising.” He added enthusiastically, “you can feel the change in activity at the port. Things are looking up for our tenants. Companies have announced plans to build offshore vessels, and some are agreeing to build for the deep end as more rigs come on line. It takes a year and a half to get a rig on line.”

 

  • Robust Volume Gives Way to Increasing Optimism
     

Shane Guidry, chairman and CEO of Harvey Gulf International Marine, LLC in New Orleans, said in late March “there are no boats available to rent, and it's the busiest I've seen it in two decades.” Separately and In Morgan City, David Barousse, business development director at Fleet Operators, Inc., agreed that OSV demand is on the rise. “Vessel operators are very optimistic that 2012 will be busy because of the feedback they're receiving from their customers” – a mix of oil and gas operators and service companies, he said. Fleet Operators owns and charters supply vessels for offshore oil and gas.

 

  • Bollinger Upbeat about Deepwater; Big Plans for Hornbeck


Boysie Bollinger, president and CEO of Bollinger Shipyards Inc. in Lockport, La., said demand for future, deepwater vessels is increasing, and he pointed to recently announced orders for deepwater vessels from Hornbeck Offshore Services and Harvey Gulf International. “There are quite a few new, large deepwater rigs scheduled to work in the Gulf in the next few years,” he said. “We're optimistic about deepwater activity in the coming year.”


That said, Bollinger cautioned, “demand for vessels should continue to increase but could be offset by U.S. flag vessels that were deployed overseas in the last two years returning to the Gulf.” Bollinger Shipyards builds OSVs, tug boats, ocean barges, rigs, liftboats, patrol boats and inland push boats and barges.
 

Elsewhere, in a $720 million program announced in November, Hornbeck Offshore Services in Covington, La., plans to build sixteen, 300-class offshore supply vessels, and has contracted eight of them to VT Halter Marine in Pascagoula, Miss. and eight to Eastern Shipbuilding Group in Panama City, Fla., with options to build more. Robert Socha, executive vice president for sales and marketing at Bollinger, said “demand for deepwater support vessels in the 4,500 to 6,000 DWT range has increased in the Gulf over the past year with announcements of future, deepwater oil and gas exploration. Several announcements have been made for new-build programs at various shipyards, filling Gulf Coast shipyard capacity. The demand for OSV’s is targeted towards larger capacity vessels with DP 2.”
 

Socha added “our repair groups continue to see demand for our larger dry-docks that are capable of servicing larger support vessels.” Bollinger, the top volume vessel-repair company in the GOM, has twelve shipyards and 31 dry docks in Louisiana and Texas.

 

  • Gulf Investment Climate Improves Versus Two Years Ago
     

Don Briggs told MarineNews in March, “After the Macondo accident, the Gulf of Mexico suffered a sharp decline as an attractive place to drill a well, according to a Fraser Institute survey” of petroleum industry executives. The GOM dropped from 11th out of 133, to 60th out of 135 in the Fraser Institute’s fifth annual survey, released in June 2011, about barriers to investment in oil and gas exploration and production around the globe. But industry is more hopeful now, said Briggs. “The important thing is to have real, continued consistency in the government permitting program. As everyone gets more comfortable with the program, certainty comes back.”
He added “with rigs going back to work, supply vessels and support activities on the drilling side are experiencing some upside and new business. We'll see more drilling, more investment and more opportunities for the vessel industry.”

 

  • Increased Safety Focus

In reaction to the BP spill, the Bureau of Ocean Energy Management (BOEM) required that all deepwater drilling contractors in the GOM meet new safety and environmental rules and install well-containment systems in case of an accident. As for rigs that left the Gulf for Brazil and Africa, “They're under long-term projects and may not be coming back soon,” Briggs said. “But that doesn't mean that other rigs in other parts of the world won't make their way to the Gulf.”

 

  • Shallow Water Sector Remains Slow

Chiasson said ”we're not seeing a big uptick in shallow-water activity or in internal movement of goods. We hope shallow-water rig permitting will improve.” In its most recent analysis, GNO Inc. in New Orleans noted that an average of 4.7 shallow water permits were issued monthly in the Gulf from November to January, 34 percent below the monthly average in the year before the BP spill. Boysie Bollinger agrees, saying, “Shelf activity has increased, but very slowly. We don’t see a lot of increased activity on the shelf, based on new-build requests for those types of vessels.”
 

The Inner Continental Shelf extends from the coastline and gradually slopes to depths of 360 feet. In Louisiana, the federal Outer Continental Shelf starts 3 1/2 miles offshore. Both shallow and deep water permitting in the Gulf lag pre-spill rates. Only three deepwater permits were issued monthly from November to January, down 48 percent from the average of 5.8 permits per month prior to the spill. Approval times for plans are much longer than before the spill, and detailed, environmental assessments are required now for deepwater drilling plans. It’s not getting any easier, most agree.

 

  • Wind Power Seen As A Way To Use Depleted Fields
     

Some of the Gulf's shallow water wells are starting to run dry, driving the industry into deeper water. As oil becomes more expensive to extract, companies are looking to adapt old fields for offshore wind energy. Baryonyx Corp. in Austin, Texas plans to build two wind farms, 5 and 10 miles offshore respectively from Port Isabel, Texas. Power will be delivered to the Electric Reliability Council of Texas or ERCOT transmission grid. Offshore wind farms can also help oil and gas companies – who ship diesel fuel to run generators on their platforms and rigs – save on fuel costs.

 

  • New, LNG-Powered OSVs For The Gulf
     

Most vessels fueled by liquid natural gas more than meet current U.S. Environmental Protection Agency emission standards, and LNG is cost effective. “But LNG is still new and slow to catch on,” Guidry of Harvey Gulf said. “I have only four of them being built.” That said, Harvey Gulf arguably remains ahead of the pack in building increasingly redundant safety systems out in front of coming regulations for their growing, ultra-modern fleet of workboats.
As announced this past February and October, Harvey Gulf contracted Trinity Offshore, LLC, in Gulfport, Miss. to build four LNG-fueled OSVs. Those ecologically-friendly boats will meet American Bureau of Shipping ENVIRO+ standards. They will have dual-fuel capabilities and when running in gas mode, will produce no sulphur oxide emissions since gas doesn't contain sulphur. Nitrogen oxides will be slashed compared with diesel operations, and CO2 emissions will be lowered. Natural gas produces almost no particulates.

 

  • Gulf Lease Sales Scheduled For June
     

In January, President Obama said that his administration is opening another 38 million acres of the central Gulf of Mexico to exploration and development with June 20 oil & gas lease sales in New Orleans. Those sales, however, were scheduled in the 2007-2012 Outer Continental Shelf Leasing Program, planned in 2007. Thankfully, they weren't canceled, industry members said.


Today, increased drilling activity has allowed measured optimism in a recovering, GOM maritime economy.  More drilling in an environment of heightened government oversight and increased safety points to a better year for OSV operators and their clients. 

 

(taken from April 2012 print edition of MarineNews)
 

Susan Buchanan is a New Orleans-based business writer, specializing in energy, maritime matters, agriculture, the environment and construction. She holds a master's degree from Cornell University in agricultural economics and an undergraduate degree from the University of Pennsylvania.
 

Maritime Reporter January 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Reftrade Upgrades Fleet Refrigeration Systems

Reftrade UK  has made an investment  to upgrade its fleet with environmentally friendly technology. The world’s first refrigeration system to use CO2 as a natural refrigerant,

ClassNK Reports Record 2014

Announcing its registration totals for 2014, ClassNK said 833 new vessels with a combined total of 21,466,272 gt joined its register over the course of the year,

GE Launches GE Marine Organization

GE unveils GE Marine organization to power, propel and position the global marine industry   GE unveiled today its new GE Marine organization which cumulates

Shipbuilding

Ferus Smit to Launch Newbuild for Symphony Shipping

Ferus Smit announced it will launch Newbuuld 417 on Saturday, February 21 in Leer.   Newbuild 417, a multipurpose vessel to be christened Nordana Sky, is the

Damen Delivers Custom-Made Offshore Winches to Fugro

Damen Maaskant Shipyards, part of Damen Shipyards Group, has delivered two dedicated offshore winches to Fugro. The Dutch shipyard was responsible for the design,

MOL, Mitsui Ink Charter Deal

Mitsui O.S.K. Lines, Ltd. signed a contract with Mitsui & Co., Ltd. today (January 29) to charter a new 177,000m3 liquefied natural gas (LNG) carrier. This

Ship Repair & Conversion

The Art of Propeller Making

The world’s biggest propellers have their cradle in the North of Germany. MMG – Mecklenburger Metallguss GmbH – has manufactured for more than 65 years propellers for ships,

USACE Barges, Tugs Up for Repair

The United States Army Corps of Engineers (USACE) Buffalo District has awarded a repair contract to Great Lakes Shipyard for two tugs and two barges from the Corps’ Cleveland Field Station.

Signal Ship Repair Achieves OSHA Milestone

Signal International announced that on December 31, 2014, the Signal Ship Repair Operations located in Mobile, Alabama achieved one full year and worked 387,926 manhours,

Offshore

Damen Delivers Custom-Made Offshore Winches to Fugro

Damen Maaskant Shipyards, part of Damen Shipyards Group, has delivered two dedicated offshore winches to Fugro. The Dutch shipyard was responsible for the design,

Shell: UK Should Reduce North Sea Oil Tax

The British government should review a supplementary tax charge on North Sea oil producers as it has made the operation of some fields unrealistic, Shell Chief

Shell Eyes Arctic Drilling this Summer

Oil major Shell wants to revive its Arctic oil drilling programme this year after a near two-year suspension, angering environmentalists who say the risk of an oil spill is too high.

Workboats

LEEVAC Launches First PSV for Tidewater

On Tuesday, January 27, LEEVAC Shipyards Jennings, LLC launched hull 367, a platform supply vessel (PSV) designed by LEEVAC Design Services, LLC (300 DE-52 HAB PSV).

USACE Barges, Tugs Up for Repair

The United States Army Corps of Engineers (USACE) Buffalo District has awarded a repair contract to Great Lakes Shipyard for two tugs and two barges from the Corps’ Cleveland Field Station.

Damen Delivers Workboat to Multraship

Towage and salvage operator Multraship has taken delivery of the first of two customized Damen Stan Launch 804s vessels for its line handling and boatmen service companies in Terneuzen,

Energy

Damen Delivers Custom-Made Offshore Winches to Fugro

Damen Maaskant Shipyards, part of Damen Shipyards Group, has delivered two dedicated offshore winches to Fugro. The Dutch shipyard was responsible for the design,

Stolt-Nielsen Q4 Profit Misses Forecast

Shipping firm Stolt-Nielsen reported fourth quarter earnings below forecasts on Thursday and said it was concerned about the outlook for the chemical tanker market,

Shell: UK Should Reduce North Sea Oil Tax

The British government should review a supplementary tax charge on North Sea oil producers as it has made the operation of some fields unrealistic, Shell Chief

 
 
Maritime Careers / Shipboard Positions Maritime Security Maritime Standards Naval Architecture Navigation Offshore Oil Pod Propulsion Salvage Ship Electronics Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.3713 sec (3 req/sec)