Port Security: Port of Long Beach’s virtual port

Sitting side by side, the Ports of Long Beach and Los Angeles form the San Pedro Bay Port Complex at the point where the mouth of the Los Angeles River completes its 50-mile course to the Pacific Ocean. Though operating independently, together the two facilities make up the largest port complex in the United States and are responsible for more than 40 percent of the nation’s containerized cargo shipments.

With an eye to the future, the Port of Long Beach is currently involved in a massive, 10-year capital investment program that will cost more than $4.5 billion. According to Randy Parsons, director of security for the Port of Long Beach, “This will enhance our position of being big ship ready. We will be able to provide docking services to ships that can carry cargo up to 21,300 TEU [20-foot equivalent units]. With increasing competition and the growing size of the container ships that are transporting cargo, our expansion program is designed to sustain us as a leader in the industry for the foreseeable future.”

Implementing the Virtual Port
Occupying more than 3,200 acres (13 km2) of land with 25 miles (40 km) of waterfront, the Port of Long Beach poses a major challenge for security operations, particularly since it is an open port that provides docking services to pleasure and small business craft and commercial cargo ships. In addition, more than 15,000 trucks and 100 trains move in and out of the port every day. The dynamic nature of the port, with its constant movement and 24-hour operations, requires close surveillance. Like many ports, Long Beach maintains a multilayered physical security system that includes closed-circuit television surveillance, helicopter downlinks, radar tracking, sonar and other sensor-based systems. About six years ago, Esri ArcGIS was added to help visualize security operations, and the advantages of making GIS central to the port’s joint command and control center were quickly realized.   

In 2011, the Port of Long Beach began the development of the Virtual Port application. “Virtual Port is a dynamic, ArcGIS [software]-based system that is fundamental to our security operations,” says Parsons. “It is the essential technology of our command center and has allowed us to geospatially enable our entire security operation. So we now have more than 60 geographically referenced databases that are integrated with the existing elements of our physical security system, which increases exponentially our ability to monitor and analyze our daily operations.”

Additionally, Virtual Port is used for two other primary functions: incident response and business recovery. “The beauty of Virtual Port is that we are using the same ArcGIS platform with the same databases for all three of our main functions,” says Parsons. “This means that our security systems operators have complete familiarity with the system and don’t have to switch over to something else in the event of an emergency.”

A major aspect of business recovery is to get the port operational again as quickly as possible after an incident. Virtual Port can help officials determine which areas of the port are inoperable, what remains open, and what resources are available to quickly resume port operations.

Applying the ArcGIS Platform to Port Security
Virtual Port’s GIS software stack makes full use of the ArcGIS platform. ArcGIS for Server is used to store data layers, services, and feeds within the port’s physical server environment, while Portal for ArcGIS creates, manages, and shares web maps through Virtual Port. This application was built with Esri ArcGIS API for JavaScript and allows users to access Virtual Port from many different environments and devices. Since it is a web app, users do not have to install any native applications or plug-ins to access Virtual Port. Each user is given credentials and a physical or soft token for a two-step authentication. Other software includes ArcGIS GeoEvent Extension for Server, which is used to display dynamic services and feeds, such as asset or automatic identification system vessel tracking. Rule-based alerts are built into GeoEvent Extension and provide instant notifications to port personnel when certain conditions occur, such as a vessel coming within the designated radius of a restricted area. Collector for ArcGIS and Operations Dashboard for ArcGIS are used in Virtual Port to support in-field data collection and situational awareness.

Interagency Collaboration and an Increasing ROI
Partner agencies can connect to Virtual Port and access its common operational picture to collaborate and share information to ensure the resiliency of the facility. Port officials can also run what-if scenarios that model chemical plumes and other hazards to help agencies prepare for and better understand the impact of potentially dangerous situations.

Virtual Port functions as a bidirectional, open-source clearinghouse for the agencies that partner with the security division of the Port of Long Beach. That is, partner agencies have access to the included data, but they are also encouraged to add their own data to the system. About 12 different law enforcement agencies station personnel at the port, and they are allowed access to Virtual Port. To manage the many users, multiple security levels have been implemented. A variety of federal, state, and local public service agencies use some aspect of Virtual Port for their operations. The port also partners with agencies in the surrounding area including the City of Long Beach Emergency Communications and Operations Center, local police and fire departments, and some of the local health agencies.

Though not all ports are the size of the Port of Long Beach or command the resources to implement a GIS-based security system as comprehensive as Virtual Port, Parsons indicates that the system is scalable for different-sized operations. And it can be applied to ports with different cargo operations, such as shipments of break bulk cargo or liquid natural gas. A real win, however, is the recently discovered return on investment (ROI).

“While Virtual Port provides us with a clear operational picture of our extensive day-to-day security activities, we have found that it is also helping lower our business operating costs by streamlining those processes,” concludes Parsons. “This is a huge benefit to centralizing our security operations around ArcGIS because it provides us with an increasing return on investment.”

 

 

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Azimuth thrusters change the way operators move cargo

Over the years, the use of azimuth thruster has changed the way operators do business. The increased maneuverability and efficiency gains allow tug operators to do more with the same installed power. Added maneuverability can also play a role in improving safety during certain operations.  With more than 50 years of developing and manufacturing azimuth thrusters, Rolls-Royce has learned a lot about the specific propulsion requirements of different types of ships and floating structures. Working close with the customers has been a key element of the success.

Steerable azimuth thrusters have come a long way since the first one went into service in 1965. With just 80 hp of thrust it was installed on a mud hopper barge in Finland to make it self-propelled. The first azimuth units specifically designed for inland waterway applications were delivered in 1976. They powered a series of three-river push boats built in Holland and are still operating today.

With the aid of modern computer-based design tools and a detailed understanding of hydrodynamics, Rolls-Royce is continuously developing and improving its thruster product range. The current product portfolio covers a power range of 300 to 14,000 hp.

The benefits of Azimuth thrusters on a towboat
With an azimuth thruster the full thrust can be applied in any direction through the full 360 degrees and significantly improve the maneuverability and braking force of the vessel. In performance tests it has been shown that the braking forces produced are nearly 1.5 times those of the conventional towboat, over the whole speed range. This increase in braking force reduces both the distance and the time needed to stop a barge train.

For shallow draft operations, the normal requirement is to fit 2 azimuth units, and it is not unusual to have towboat designs with a triple azimuth thruster propulsion arrangement.

Azimuth thrusters also significantly increase flanking forces, which help operators safely navigate through the most difficult bends of the river. On a conventional towboat, flanking rudders and reverse thrust are normally used to produce the necessary flanking forces. By using azimuth thrusters the transverse force can be maximized and is approximately twice the maximum side force produced by a conventional towboat at all measured speeds, plus there is the benefit of greater braking forces. Maximum flanking forces produced can be up to 4 times that of the conventional towboat with equal braking force.

How Azimuth thruster help in Brazil
Brazil is a country traversed by many rivers, the main one being the Amazon. There are 11 main inland waterways with a total length of some 39,000 miles although only approximately 8,000 miles are regularly used. These waterways are used to transport agricultural commodities such as grain and fertilizer, as well as mineral goods to the coast.

Amaggi Navegação a subsidiary of Amaggi Exportação e Importação Ltda. is one of the operators working in the region who has moved to azimuth thrusters to propel their vessels. They have been operating on these waterways for over 20 years and now have over 30 tugs equipped with azimuth thruster propulsion. Units in their fleet include a range of Rolls-Royce thrusters from our smaller US 105 model to our larger US 255’s.

Amaggi Navegacao operate on the Madeira and Amazones rivers where they are involved in the transportation of grain and soya to and from local processing plants. The move away from conventional towboat design has enabled them to increase the size of barge trains, which is due to increased turning and stopping capacity at full load.

Open propeProp2llers are used for the majority of these thruster applications due to the amount of debris in the rivers. The trend outside the Amazon is to fit azimuth thrusters with nozzles and thereby maximize thrust.

The future of Azimuth thrusters
Thruster technology continues to develop. The latest is the introduction of gearless electric drive through the application of permanent magnet (PM) rim drive technology, where the motor surrounds the propeller as a slim ring. The rotor is integral with the propeller and carries a series of permanent magnets. As the magnetic fields interact, the propeller turns. Tunnel thrusters and azimuth thrusters utilizing this technology are now available from Rolls-Royce. The compact and efficient tunnel thruster unit is easy to install and power output is increased by around 25% for the same propeller size. It is a good example of the possibilities that lie ahead.

This technology has now been applied to the azimuth thruster by Rolls-Royce, and the first PM development thrusters rated at 670 hp were installed on the research vessel R/V Gunnerus in March 2015. Nozzle shape can be selected to suit individual applications, but since Gunnerus requires pull for towing trawl and other gear, the nozzle is optimized for bollard pull and speed to match the vessel’s requirements. The installation is compact with only the slip ring unit and the variable frequency steering motors inside the hull.

Before the installation, the vessel had a conventional diesel electric propulsion system consisting of frequency converters, induction motors, gears and shaft with nozzle propeller. Testing to date has demonstrated an improvement in propulsive efficiency and bollard pull with a reduction of air and structure borne noise and vibration.

 

 

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Best practices in choosing and maintaining EALs for marine applications

With the U.S. Environmental Protection Agency’s Vessel General Permit (VGP) regulations in place for several years now and Small Vessel General Permit (sVGP) poised to expand these regulations to new classes of vessels, marine operators have embraced the use of environmentally acceptable lubricants (EALs) and become familiar with the inherent environmental and performance benefits of switching from conventional lubricants.

However, there is still a great deal of confusion in the marketplace surrounding EAL choice and maintenance. It’s important for operators to educate themselves on which type of EAL is best suited to different applications and strategies for maximizing ROI and equipment life.

The EPA recognizes four types of EALs. While all meet requirements, these lubricants vary widely in terms of suitability for different applications, performance characteristics, and fluid life, among other considerations. While all EALs offer the advantage of being high viscosity index lubricants (High-VI), it is important to cut through confusing and oftentimes contradictory marketing claims to understand the relative advantages and disadvantages of each type, based on its chemical composition.

  • Vegetable Oils (HETG) – Also known as triglycerides or natural esters, these lubricants are made of vegetable, rapeseed (Canola), sunflower, coconut, palm or soybean oil. HETGs provide very good wear properties and are compatible with most seals and hoses, but are not as well suited to high temperature applications as other EALs. They are also more susceptible to hydrolysis in the presence of water and have a shorter lifespan than other EALs. With that in mind, they are best suited to land-based applications with scheduled change-out intervals.
  • Synthetic Esters (HEES) – Esters are synthesized by the reaction of an alcohol with an acid. This reaction process allows for the flexibility to customize the type of ester used for a particular application. Generally, HEESs offer high performance, good oxidative and thermal stability and corrosion prevention, but they can be prone to hydrolysis in the presence of water. They work well in a wide range of land and marine applications with scheduled change-out intervals. Given possible hydrolysis issues, it’s best to use saturated hinder esters to provide the best stability with marine applications.
  • Polyalkylene Glycols (HEPG) – Made of synthetic, petroleum based oil, HEPGs are created by the polymerization of ethylene or propylene oxide. HEPGs are designed to be water soluble, but this water solubility may increase toxicity. They are well suited to operate in high and low temperatures, and they have strong fire-resistant properties, which make them an excellent choice for volatile environments. HEPGs are typically recommended for use in a wide range of both land and marine applications with scheduled change-out intervals. On the downside, they are typically not derived from a renewable resource, are not compatible with other mineral oils and EALs, and can break down certain equipment seals, hoses, paints and varnishes.
  • Polyalphaolefins (PAOs) and related hydrocarbon products (HEPR) – Often referred to as classic mineral oil based lubricants, HEPRs are synthesized hydrocarbons traditionally derived from crude oil meant to provide a low viscosity base oil that is readily biodegradable. However, more recently, HEPR type base stocks from renewable sources have been developed. HEPRs are highly durable and offer extended wear protection and fluid life, making them an ideal choice for equipment whose fluid cannot easily or frequently be changed. HEPRs also offer broad temperature range performance and seal compatibility, with good corrosion protection and strong hydrolytic and oxidative stability, reducing friction, preventing system wear and increasing efficiency. Essentially, HEPRs are recommended for use in a wide range of land and marine applications with scheduled change-out intervals. They also offer the added benefit of drop-in replacement and offer excellent water separation characteristics.

Getting the Water Out: Emulsifying Versus Demulsifying Fluids
Another critical decision factor in EAL choice is how the lubricant interacts with water. In marine environments it is not a question of whether, but how and how much water will enter a hydraulic system. While some operators choose to use emulsifying fluids that can essentially absorb this water, recent studies have shown that the presence of water in the system, even if it has been emulsified, serves as a catalyst for oxidation and hydrolysis – the formation of acids that corrode and damage the system. These same studies suggest that the use of demulsifying EALs – ones that separate the water from the fluid for easy extraction – have the potential to greatly extend equipment service life and performance. Like conventional oil, HEPRs have the best demulsifying properties, making them a great choice for marine applications.

Choosing Wisely
The chart below provides information on the specific properties and performance attributes of each type of EAL, as well as standard petroleum based lubricant, to help guide your decision-making.

  HETG HEES                 HEPG HEPR Standard Petroleum
Readily Biodegradable Yes Yes Yes Yes No
Ecotoxicity Low Low Low* Low High
Bioaccumulation Potential No No No No Yes
Sheen No No No No Yes
Seal Compatibility Good Good Poor Good Good
Wear Performance Very Good Very Good Very Good Very Good Very Good
Oxidation Performance Poor Good Very Good Very Good Very Good
Low Temperature Performance Poor Very Good Very Good Very Good Poor
Viscosity Index Very Good Very Good Very Good Very Good Poor

*Solubility may increase the toxicity of some PAGs

Best Practices for Extending Fluid and Equipment Life and Maximizing ROI
Choosing the right EAL is only half the battle; measuring the effectiveness of your chosen lubricant and instituting a proper maintenance regime is essential to ensuring performance, protecting your equipment and getting the most for your money.

Maintenance Protocols
In addition to establishing performance benchmarks, logging all issues and causes of downtime, making timely repairs and establishing a regular change out schedule, cleanliness control is one of the single most important and often overlooked aspects of effective lubricant maintenance.

To ensure cleanliness and avoid contamination, refill or dispense only from clean, sealed containers. It’s also important to follow OEM recommendations, establish a set protocol and document all maintenance, including fluid top-offs.

Oil Analysis
Oil analysis, another critical component of maintenance, is the laboratory analysis of a lubricant’s properties, suspended contaminants and wear debris to provide a snapshot of how fluids and equipment are performing at a given time and over time. This analysis is performed by capturing oil samples during routine predictive maintenance to provide meaningful and accurate information on lubricant and machine condition. By tracking oil analysis sample results over the life of a particular machine, trends can be established which can help extend equipment, eliminate costly emergency repairs and increase uptime, all of which results in significant savings.

If you do not currently have an oil analysis program in place, here are some tips to get started:

  • Find the right partner – Look for a lubricant vendor that will provide the following:
    • a clear plan of how often (monthly, quarterly) and at what intervals your lubricant should be sampled
    • sampling instructions
    • clear communication, including results and recommendations for improvement
    • oil testing and analysis through independent laboratories
  • Ask to see a sample analysis and make sure it tests for the following:
    • Viscosity @ 40°C and 100°C
    • Acid Number
    • Water contamination
    • Elemental Content
    • Particle Count
  • Use the Data – Failing to take appropriate recommended maintenance actions can be very detrimental, but use common sense to ensure that the suggested action is practical and cost effective and examine possible alternatives.

If you have questions about choosing the right EAL and maintenance practices for your operation, application and needs, the best place to start is to contact your OEM and possible vendors. At RSC Bio Solutions, we work closely with our customers to set up customized programs and solutions and continue to make recommendations based on regular results to help our customers protect their equipment, their workers and the environment. For more information, please visit www.rscbio.com.

Tugs & Barges: Evolving with the market

Engineering company GTT has more than 50 years’ experience in the design of membrane cargo containment systems, but one project underway right now in Orange, TX, is quite unique. That’s because it’s the first Liquefied Natural Gas (LNG) bunker transport barge in the United States.

One of 118 GTT projects currently underway worldwide, the tank barge is taking shape at Conrad Orange shipyard, Aziz Bamik, General Manager of GTT North America, told delegates at Marine Log Tugs & Barges 2016 Conference & Expo held last month in Seattle. While Conrad has decades of experience building all types of tank barges—dirty oil, products, chemicals, and LPG—this is the first time that it is building a vessel with one of GTT’s Mark III Flex membrane tank technology. Following a certification process, Conrad signed a license agreement with GTT back in January 2015 to construct the Mark III Flex.

Designed to operate in inland waterways, bays, harbors, and U.S. coastal waters, the new 2,200 m3 tank barge will be used to refuel TOTE’s two 3,100-TEU LNG-powered containerships. The barge will travel about a mile from its mooring facility to fuel the two Orca Class containerships, which operate out of the Port of Jacksonville, FL to San Juan, PR. The barge is designed not as an Articulated Tug Barge unit, but rather to be towed by hawser wire, pushed or maneuvered by hip, says Bamik.

In anticipation of increasing demand for LNG as a marine fuel, Bamik also mentioned to the conference audience that GTT North America was working with Conrad on a larger Articulated Tug Barge unit that will have a capacity of 4,800 m3, with two GTT Mark III Flex Cargo Containment System tanks. The 319 ft x 62 ft barge would have cold LNG delivery with onboard reliquefaction.

COMING DEMAND FOR LNG
The interest in LNG as a marine fuel seems to have waned in the U.S. with the drop in the price of oil. As of today, five vessels burn LNG as fuel in the Jones Act market. Besides TOTE’s two containerships, the Harvey Power, the third in a series of six dual fuel Platform Supply Vessels for Harvey Gulf International Marine, New Orleans, recently entered service in the Gulf of Mexico under charter for Shell. Next year, Crowley Maritime will take delivery of two Commitment Class Container Roll-on/Roll-Off (CONRO) ships for Puerto Rico. Those are being classed by DNV GL. All the other Jones Act LNG fuelled vessels are being built to ABS class.

Additional LNG Ready classed tonnage delivered or being built by General Dynamics NASSCO in San Diego and Philly Shipyard Inc. in Philadelphia could grow the LNG-fueled Jones Act fleet if converted in the future. TOTE is also converting its two Orcas Class RO/RO ships for Alaska service in Singapore.

Globally, there are about 77 gas-fueled vessels in operation and another 79 confirmed newbuildings as of March 2016, according to Anthony Teo, Technology and LNG Business Development Manager, North America, DNV GL. “There are about another 50 LNG Ready vessels have been contracted,” Teo told delegates. He said that DNV GL estimates there will be 360 LNG fuelled vessels in operation by 2020.

The widespread adoption of LNG as a fuel, Teo pointed out, was is being hindered by the lack of gas fuel bunkering facilities in ports.

A panel of naval architects, liquefied natural gas reliquefaction technology providers, and regulators discussed more in-depth the current hurdles hindering the expansion of the adoption of LNG as a marine fuel for the tugs and towboats in the Jones Act market.

Panelist Rafael Riva, Marine Business Development Manager, ECA, Lloyd’s Register pointed out that the technology was well proven in Europe. The first LNG tugs, for example, were built in Turkish shipyard Sanmar for Norway’s Bukser og Berging AS and have been in service for Statoil AS since 2014. The DNV GL class tugs are equipped with lean burn gas engines from Rolls-Royce and Rolls-Royce azimuthing thrusters.

The LNG powered propulsion systems does require more space. The Shearer Group’s Engineering Manager Joshua Sebastian, PE, mentioned the complexities of integrating the necessary fuel tank, piping, and control systems required to burn LNG on the smaller towboat platform. Sebastian’s company, naval architectural firm The Shearer Group, has been contracted for the conversion of a 65-foot-long conventional diesel-powered towboat to burn LNG.

LNG-powered tugs also require small volumes of fuel with a dedicated delivery solution. Fueling can be accomplished either via tanker trucks, shore LNG storage tanks, portable gas fuel tanks or ship to ship or barge to ship transfer.

Panelist John Dwyer, Officer in Charge, Marine Inspection/Chief, Inspection Division at USCG Sector Puget Sound, provided the regulatory view on the development of LNG as a marine fuel in the U.S.

The U.S. Coast Guard has issued a number of policy letters and guidance on the design and operation of ships using LNG as a marine fuel, as well as ships and facilities transferring LNG as fuel. The U.S. Coast Guard has addressed designs and facilities on a case-by-case basis.

Waller Marine’s Beau Berthelot pointed out that his company has worked on a number of refueling solutions. Waller Marine, for example, has been granted an Agreement in Principle (AIP) by ABS for a new liquefied natural gas (LNG) and regasification articulated tug barge concept. The vessel has the ability to load LNG from existing LNG terminals, liquefaction facilities or traditional LNG carriers and transport the LNG to existing tanks, traditional LNG carriers, trucks or marine vessels using LNG as a fuel. The barge also is equipped for regasification of LNG directly to a pipeline or to a power plant. An additional feature will be the use of natural gas as a fuel in the dual fuel engines of the tug to drive the tug-barge unit.

The benefit of the LNG Articulated Tug and Barge Regas Vessel (ATB RV) is that it allows LNG to be moved and delivered more efficiently on a small-scale basis in locations where large LNG infrastructure would be cumbersome, costly and time consuming.

Another possible solution for small footprint applications mentioned by panelists David Grucza, Director, Drilling and Marine U.S., Siemens, and Michael Walhof, Sales Director, Distributed LNG Solutions, Dresser-Rand, a Siemens company, was Dresser-Rand’s LNGo system is a modularized, portable natural gas liquefaction plant. This point-of-use production plant is a standardized product made up of four packaged skids: a power module, compressor module, process module and a conditioning module. The natural gas consumed powers the unit and is also used as the process refrigerant to eliminate complexity and maintenance.

SHIPYARDS CONTINUE TO BE BUSY
Meanwhile, U.S. shipyards continue to book orders for conventionally powered harbor tugs and Articulated Tug Barge (ATB) units. The continued orders for ATBs, in particular, are in response to transport refined products in the U.S.

Just last month, Gunderson Marine, Portland, OR, secured an order to build two 82,000 bbl, 430 foot-long oceangoing tank barges for Harley Marine Services, Inc., Seattle.  The tank barges will be part of an ATB unit.

Gunderson last built a barge for Harley Marine in 2009.  Construction on the barges will begin this year, with delivery of both vessels set for the second half of 2017. 

As of press time, Harley Marine Services was negotiating with a Gulf Coast shipyard for the construction of the ATB tugs that would be coupled to the tank barges being built by Gunderson.

Over the past nine months, Gunderson Marine has delivered two 578 ft ATB oceangoing barges for chemical and oil service for Kirby Offshore Marine.

For its tank barges, Kirby Offshore Marine took delivery of two 10,000 hp ATB tugs from Nichols Brothers Boat Builders, Whidbey Island, WA. Speaking at Marine Log Tugs & Barges 2016, Nichols Brothers Boat Builders President & CEO Gavin Higgins said that ATBs enjoy several cost advantages over coastal tankers when it comes to moving refined products. Crew costs are far less, nine crew vs. 18 crew. Additionally, ATBs are more ship shape, offering speed advantages over towed tank barges.

The shipyard has also signed a contract with Kirby for two line haul tugs, as well as two 8,000 hp ATB tugs based on a design by naval architect Robert Hill of Ocean Tug & Barge Engineering. The companion tank barges are being built by Vigor.

FINCANTIERI BAY SHIPBUILDING
Fincantieri Marine Group’s Fincantieri Bay Shipbuilding (FBS), Sturgeon Bay, WI, has delivered the Articulated Tug Barge unit (ATB) Barbara Carol Ann Moran and the 110,000-barrel ocean tank barge Louisiana to Moran Towing Corporation, New Canaan, CT.

The 5,300-HP, 121-foot ATB tug Barbara Carol Ann Moran is certified ABS Class +A-1 Towing Service, +AMS, and is equipped with state-of-the-art navigation and communications technology. The Louisiana is 468 ft x 78 ft.

The ATB unit will work the East Coast of the United States and the Gulf of Mexico.

This is the shipyard’s third delivery to Moran under a 2014 contract, with a tank barge delivered in May of 2015, and another ATB—the tug Leigh Ann Moran and tank barge Mississippi—delivered December 1, 2015.  

VANE BROTHERS SERIES AT ST. JOHNS
Vane Brothers, Baltimore, MD, continues to invest in new tonnage. It has a long running newbuild program at Chesapeake Shipbuilding in Salisbury, MD, where it is constructing a series of 3,000 hp ATB tugs and has now added the second of eight 4,200 horsepower tugboats from St. Johns Ship Building, Palatka, FL.

The new tug, Hudson, is the second of Vane’s Elizabeth Anne Class, under construction at St. Johns Ship Building. Lead vessel of the class, the Elizabeth Anne, was delivered in January, while the third in the series, the Baltimore, is set for completion this summer.

The new tug will be paired with the Double Skin 601, the first in a new series of 55,000 bbl barges and will be followed later this year by the Double Skin 602, both built by the Conrad Deepwater South Shipyard in Amelia, LA.

“Our ongoing fleet construction program ensures that we have state-of-the-art equipment available to service all of our customers’ needs with the utmost safety and efficiency,” says Vane Brothers President C. Duff Hughes.

Designed by Frank Basile, P.E., of Entech Designs, LLC, Vane Brothers’ Elizabeth Anne Class tugboats are close cousins to the Basile-designed Patapsco Class tugboats, 15 of which were produced between 2004 and 2009.

Measuring 100 feet long and 34 feet wide, with a hull depth of 15 feet, the model bow Hudson is powered by two Caterpillar 3516 Tier 3 engines, each generating 2,100 horsepower at 1,600 rev/min. Two John Deere PowerTech 4045, 99 kW generators deliver service power to the boat, while a third John Deere 4045 teamed with an Allison transmission drives the chain-driven Intercon DD200 towing winch. The Elizabeth Anne also has Reintjes marine gears supplied by Karl Senner, LLC, Kenner, LA.

The Hudson features the latest in solid-state, Simrad electronics and handsomely appointed, mahogany upper and lower pilothouses, as well as spacious accommodations for up to seven crew members.

Meanwhile, the Double Skin 601 is configured and outfitted in a nearly identical fashion to the most recent 55,000 bbl Vane Brothers barges that were delivered in 2015 by Indiana-based Jeffboat Shipyard. Like them, the Double Skin 601 is equipped with an 8,600 BTU thermal fluid heating system, vapor control system and cargo tanks coated with International Interline 994 Epoxy Novolac. However, the Double Skin 601 has a raised forecastle bow design, which provides additional reserve buoyancy.

The DS-601 and its sister, the DS-602, are both fitted with two fixed boom pedestal cranes each, Model F1-65, with a 65-foot boom length supplied by Techcrane International, Covington, LA.

Primarily tasked with towing petroleum barges engaged in the North Atlantic coastwise trade, the Hudson has joined the Elizabeth Anne among more than 20 vessels that are part of Vane’s Delta Fleet, based in Philadelphia. The DS-601 is also a new Delta Fleet member.

NEW TUG FOR SEA VISTA
In early April, BAE Systems Southeast Shipyards, Mobile, AL, launched the first of two 12,000 hp ATB tugs for Sea-Vista ATB, LLC.

One of the interesting features of the tug M/V Sea Power is that it has two independently controlled and operated hydro-dynamic Van der Velden Barke rudders. Independent Proportional Steering will allow the rudders to be actuated either independently or synchronized. The rudders were supplied by Dutch company Van der Velden Marine Systems (VDVMS) in conjunction with its U.S. representative Ships Machinery International, Inc. (SMI).

Van der Velden says that tank tests showed that rudder design was extremely effective for this type of vessel. This ATB tug will have enhanced maneuverability and excellent course keeping stability. The efficiency provided by this high technology rudder solution will result in significant savings over the life of the vessel.

The 43m x 14m ATB tug, with a draft of 6.75m, is designed by Seattle-based Guido Perla and Associates, Inc. (GPA). The tug’s power is supplied by two 4,640 kW main engines and three 250 kW main generators, with a standby emergency generator of 150 kW. The vessel uses a pin connector system between the tug and the barge and fully complies with ABS Under 90 m Rules, Maltese Cross A1 AMS ACCU Towing Vessel, SOLAS, USCG Subchapter I.

“We are pleased that our client selected this state of the art rudder system for their new vessel,” said SMI Vice President Arthur Dewey, and “we are confident that their faith in Van der Velden rudders will be rewarded over the long haul.” Van der Velden reports that the Sea Power is the only vessel of its kind in the U.S. at present time.

The tug will have exceptional maneuverability, with two independently controlled and operated hydrodynamic Van der Velden Barke rudders. Independent Proportional Steering will allow the rudders to be actuated either independently or synchronized.

Van der Velden has done a lot of work to facilitate the installation of these rudders into a hull and worked closely with Guido Perla Associates Inc. and BAE Systems to assure a smooth transition from initial design to final installation.

GPAI Chairman Guido Perla commented, “Van der Velden provided excellent technical support and on time delivery of design documents that helped us develop the engineering and design for the installation of their steering system. Their coordination with our staff was prompt and to the point. We appreciated their support.”

Van der Velden says that the key driver behind the Barke rudder is its innovative and sophisticated progressive high lift design, offering unsurpassed maneuvering and course-keeping performance, as well as smooth operational comfort. The progressively operating flap linkage system is contained in a fully enclosed, grease-lubricated Barke housing. This results in minimum wear on the linkage components and eliminates the problems caused by contact with floating objects.  

Another set of Barke high-lift rudders will be installed on a second ATB tug before this summer.

BARGE FOR PROVPORT
Conrad Shipyard, Amelia, LA, recently delivered a 300-foot long x 72-foot wide rake/box barge with a deck rating of over 6,000 pounds per square foot to ProvPort, Providence, RI, according to naval architect JMS Naval Architects, Mystic, CT. The crane barge design allows for the easy loading and unloading of cargo from ships to the dock or from ship to ship.

JMS Naval Architects, Mystic, CT, engineered and designed the crane barge for the State of Rhode Island that will be used for stevedoring operations at ProvPort Inc.

ProvPort is a nonprofit public-private partnership, formed in 1994, which owns and operates the municipal port of the City of Providence, RI. ProvPort is New England’s premier deep-water multimodal facility for international trade and domestic distribution and one of the busiest ports in America’s northeast.

JMS designed the barge to carry and operate the facility’s 440-ton Liebherr LHM 550 mobile harbor cranes. The barge is ABS classed A1 with notation “Deck Barge,” uninspected and unmanned. JMS also created the technical specification documents to utilize for the solicitation of shipyard bids and provided owner’s representative services during the construction of the barge at Conrad Industries.

The contract was funded by the State of Rhode Island’s Transportation Investments Generating Economic Recovery (TIGER) II grant program award managed by the Rhode Island Commerce Corporation. The grant was created by Congress in the 2010 Transportation Appropriations Act and allowed the purchase and installation of the barge and two high performance harbor cranes. The new stevedoring equipment will modernize and enhance the port’s ability to continue its existing bulk material operations while expanding its capabilities to accommodate container operations; thus alleviating demand on the Port of Boston—the only existing container port in New England. The new crane barge will be critical for the port which has relied on 30-year-old rented crane barges that have been prone to breakdowns and have been out service for prolonged periods. The crane barges are estimated to remove on average 1,000 trucks per week off the northeast corridor highway system—one of the most congested in the country.

NEW HARBOR TUGS FOR BAYDELTA, MCALLISTER
Jensen Maritime, Seattle, is designing tractor tugs for both U.S. East Coast and West operators. One is for Vessel Chartering LLC, a wholly owned dividsion of BayDelta Navigation. The new tug is powered by a pair of 3,385-horsepower Caterpillar 3516 EPA Tier 4 engines and is the third tugboat designed by Jensen Maritime with engines meeting EPA Tier 4 requirement.

The tug was designed without ballast tanks, eliminating the need for ballast water discharge and therefore ballast water treatment systems. To maintain proper trim, the vessel will transfer fuel, as necessary.

The tug is being built by JT Marine Inc. shipyard in Vancouver, WA, for delivery in second quarter 2017.

Jointly developed by Vessel Chartering and Jensen, the 110-ft x 40 ft tug has the ship assist and escort capabilities of smaller harbor tugs, while delivering the improved towing performance and increased range of larger ocean-going tugs.

The design offers the flexibility to support ship escorts, assists and towing, with the escort capability being enhanced to provide support for assisting the large, 18,000 TEU containerships expected to make an increasing number of West Coast port calls.

With an electrically powered, double drum tow winch aft by Rapp USA and an electrically powered hawser winch forward by Markey Machinery as deck machinery, the vessel will be capable of a 93-to-95 short-ton bollard pull. Both winches’ electrical power will remove any chance of a hydraulic oil spill on deck.

The tug is designed to carry up to 123,000 gallons of fuel, 4,300 gallons of fresh water, and up to 4,500 gallons of urea, which is used in the main engine exhaust Selective Catalyst Reduction (SCR) treatment system used to meet EPA Tier 4 emissions requirements.

On the East Coast, McAllister Towing, New York, NY, has contracted with Horizon Shipbuilding, Inc., Bayou La Batre, AL, to build it two new 100 ft x 40 ft new escort tugs.

The tugs will be powered by 3516E EPA Tier 4-compliant Caterpillar engines with Schottel SRP4000FP propulsion units producing 6,770 hp and 80 metric tons bollard pull.

The tugs will be the 31st and 32nd tractors and the first Tier IV tugs in McAllister’s fleet.

They will be ABS classed Maltese Cross A-1 Towing, Escort Service, FiFi 1 and Maltese Cross AMS.

The hull has been designed by Jensen Maritime for enhanced ship docking abilities in addition to direct and indirect escorting and the tugs have been designed and simulator tested to assist new Post-Panamax and Ultra-Large Vessels.

Towing machinery will include a Markey asymmetric render-recover winch on the bow and a Markey tow winch with a spool capacity of 2,500 ft of 2¼ in wire on the stern.

MARCON BROKER FOR NEW DESIGN TUG
Purple Water Ltd. has appointed Marcon International, Inc., Coupeville, WA, as exclusive broker to handle the shipyard licensing for construction of an innovative new tug in the Americas.

Called the Giano tug, the compact double-ended tug has a high displacement tunnel hull form, two large structural keels and a straight-line controllable pitch thruster configuration designed and built solely for ship handing.

With intuitive in-line handling controls, the tug can produce 55 tonnes (70 tonnes) of bollard thrust and pull in all directions at full power with true 360 degree maneuverability, while maintaining a 0 degree list – plus a side-stepping speed of 7 knots – from full ahead to full speed sideways in 10 seconds.

The tug works equally well from the bow or stern and is fitted with 75 tonne escort winches fore and aft.

The design is claimed to has the highest stability numbers of any escort tug afloat, not only in its own 24 m compact class, but also compared with the 32 m escort terminal class.

Two separate engine rooms, a separate generator room and a double hull with integral “W” heavy duty fendering and patented underwater fenders provide a high level of safety, and allow the tug the unique capacity to side thrust and push at full power without listing, while assisting vessels in confined spaces

The Gianotug design is patented over 40 countries.

After four years of research and development, the first tug of this class, is now available in Italy for shipowners and shipyards interested in licensing and building the design to inspect and experience a “hands-on” demonstration of the tug’s capabilities.

Built by Chinese shipbuilder Guangdong Bonny Fair Heavy Industry, the 25.75 m x 13.02 m x 5.20 m depth / 5.30 m Giano is powered by twin 1,678 kW CAT 3512C-HD diesels developing a total power of 4,562 HP at 1,800 RPM.

A Schottel SRP-3000 azimuthing drive with a controllable pitch prop is mounted in a straight line at each end, with the tunnel hull specifically designed to eliminate propeller interference.

Topside access and ultra-short shaft lines allow for main engine removal in a few hours.

The U.K. flagged Giano is classed LR +100A1, Escort Tug, FiFi-1 (2,400 cu.m/h) with water spray, Unrestricted – MCA WB Area 1 (up to 150 miles from safe haven). While this first vessel has a 55 tonnes bollard pull, the unified design allows for both 55 tonnes and 70 tonnes bollard pull versions to be built.

Shipyards struggle amid market downturn

 

During the pre-SMM 2016 Press Conference on June 2, maritime economist Martin Stopford, Non-Executive President of Clarksons Research Services, said this year shipyards worldwide have experienced the lowest newbuilding orders since the 1980s. Stopford said orders of 14.2 million deadweight tons (dwt) were placed as of the end of April 2016. On an annualized basis that equates to 42 million dwt—the lowest annual rate since 1998 when orders were placed for 37 million dwt of ships. In stark contrast, the average number of ship orders since 2009 has been 94 million dwt.

Shipyards worldwide are expected to deliver about 103 million dwt of ships this year and 88.9 million dwt in 2017.

Stopford provided a perspective on the current weak shipping markets showing the average earnings of tankers, bulkers, containerships, and gas carriers have fallen to levels not see since 2003, according to the Clarksea Index. The average earnings per day in late May fell to $8,900 per day. In 2009, average earnings per day were at $22,000 per day.

There is clearly an overcapacity of ships. He pointed to declining trend in sea trade growth, which is projected at 2 percent this year.

SMART SHIPPING’s THE ANSWER
According to Stopford, one strategy to cope with these difficulties is Smart Shipping. The rapidly evolving information and communications technology (ICT) has enormous potential to improve fleet operations and transport productivity. It will play a crucial part in the survival strategy for shipping, said Stopford.

Stopford outlined the Smart Shipping Toolbox, which includes:

  1. New Inmarsat Ka band global systems broadband data to be collected, processed and beamed ashore;
  2. Telematics: Sensors generate digital information about equipment and the ship, making it cheaper and better than ever;
  3. Data storage: Cloud storage makes it easy to store data generated by sensors. That “Big Data” is analyzed to improve performance;
  4. Smart phone-style apps and touch screens: Provide ways to do specific information jobs without the assistance of big computer systems;
  5. Information systems: Provide management with the insight into what’s going on and performance levels;
  6. Automation: Feedback loops allow automation of many tasks (navigation, maintenance, operations, etc.)

SHIPYARD CAPACITY SHRINKS
Shipyard capacity has been reduced by 20 percent with the closure of 581 “uneconomic” shipyards, but ordering levels for new ships are well below world capacity, says Stopford, so shipyards and marine equipment manufacturers are going to face a challenging year. In 2009, there were 992 active shipyards. Now, there are 423 active yards.

Based on the percentage of ship launches in the year by gross tonnage (GT), Chinese shipyards had 37 percent market share, Korea 35 percent, and Japan, 19 percent.

Korean shipbuilders have been particularly hit by the ordering slump. As we went to press, STX Offshore & Shipbuilding Co., filed for receivership. The shipbuilder could be liquidated or see its debt restructured, depending on what the court decides. STX Offshore & Shipbuilding has been under the control of creditors since 2013. The shipbuilder had losses in excess of 300 billion won last year, and 1.5 trillon won in 2014.

The top three shipbuilders in Korea, Hyundai Heavy Industries, Daewoo Shipbuilding & Marine Engineering, and Samsung Heavy Industries, have all been hurt by the drop in oil prices as oil majors have cut exploration and production expenditures. All three had repositioned themselves towards building higher valued vessels geared towards energy production after the fiscal crisis of 2008 amid competition from much lower cost Chinese shipyard rivals.

There is expected to be consolidation among Korea’s smaller shipyards.

As of mid-March, the Top Five Shipbuilder by Orderbook Value were: HHI, with $24.42 billion, Daewoo, $19.9 billion, China State Shipbuilding, $15.07 billion, Samsung, $10.47 billion, and Japan’s Imabari, with $9.89 billion.

Cruise ship order book swells to $40 billion
Cruise travel continues to grow and expand at a record pace. This year, 24 million passengers are expected to take a cruise vacation this year, up from 23 million in 2015, according to the Cruise Lines International Association (CLIA).

Cruise ship owners are deploying more ships to Australia, China, and Asia to tap into the pent up demand for cruise travel and ordering new ships to accommodate the growth. As of last year, there were 471 cruise ships in service, with 27 new ocean, river and specialty ships scheduled to be deployed this year.

Just last month, Royal Caribbean Cruises Ltd. signed a Memorandum of Understanding (MOU) with French shipbuilder STX France to build a fifth Oasis Class ship for delivery in the spring of 2021 for its Royal Caribbean brand, and two additional Edge-class ships, scheduled for delivery in the fall of each of 2021 and 2022, for its Celebrity Cruises brand.

STX France is completing the design phase of the first prototype 2,900-passenger Edge Class ship and is set to start production this fall for a delivery in fall 2018.

If confirmed, the new construction contracts with STX France would swell the global order book to 59 oceangoing cruise ships, with a total of 176,755 passenger berths. The value of the order book is in excess of $40 billion.

STX France says that, when finalized, the three orders will secure the shipyard’s order book through 2023. Overall, STX would have 12 cruise ships on order, tied with Germany’s Meyer Werft for second most to Italy’s Fincantieri, with 22 cruise ships on order. Meyer Werft’s Finnish yard, Meyer Werft Turku, has six ships on order, with the remainder of the order book divvied up between Germany’s Lloyd Werft, Croatia’s Uljanik and Brodosplit yards, and Japan’s Mitsubishi Heavy Industries.

Not included in those figures is what would be the first cruise ship built in Russia in decades. Last month, Aleksey Rakhmanov, President of Russia’s United Shipbuilding Corporation (USC), says the company was to start construction this year of a cruise ship for an unspecified customer. No further details were available.

The market for river cruise ships is just as strong, with 40 vessels on order. In the U.S., American Cruise Line, Guilford, CT, expects to take delivery of the 170-passenger coastal cruise ship American Constellation in April 2017. The ship is currently under construction at its sister company, Chesapeake Shipbuilding, Salisbury, MD.

Nichols Brothers Boat Builders, Whidbey Island, WA, won a $94.8 million contract to build two 100-passenger, 238 ft coastal cruise ships for Lindblad Expeditions Holdings, Inc. Set for delivery in the second quarter of 2017 and 2018, respectively, the ships will operate between Baja, Costa Rica, and Panama during the winter months and Alaska, Oregon, Washington and Canada in the summer months.

Threats grow, but so do Navy ship costs

Even before it was formally submitted as the Annual Long-Range Plan for Construction of Naval Vessels for Fiscal Year 2016, a draft of the Navy’s latest shipbuilding plan was floating around Washington and being seen by defense commentators as likely to have a short shelf life. The plan holds to the Navy’s goal of reaching a 308-ship battle force over the next five years. But an ongoing Force Structure Assessment (FSA) is under way that will likely see that number raised, the U.S. Naval Institute quotes naval analyst Bryan Clark of the Center for Strategic and Budgetary Assessments as saying. Clark, a former special assistant to past Chief of Naval Operations Adm. Jonathan Greenert, told USNI News that the plan is “very provisional until the Navy comes up with a new set of force structure requirements.” He added that Congress is “already weighing in with additional ships they want to build, and the new administration is going to obviously have things they want to do differently.”

The draft is an updated version of the plan submitted last year and continues to be based on the 2012 Force Structure Assessment (FSA) “to meet strategy and presence requirements and maintain a healthy industrial base.”

The problem with this is that the world has gotten a lot more dangerous since the 2012 FSA was compiled. Among other things, Vladimir Putin has invaded and annexed Crimea and subsequently pulled out various ploys from the Soviet era Cold War play book and China has been building whole new Spratley islands and sticking airstrips on them, essentially creating large (if stationary) aircraft carriers. Turn on the BBC World Service News any day and you’ll be able to add to the list.

The upshot is that the next FSA is likely to produce a need for a larger submarine fleet and more cruiser/destroyer-type vessels (CRUDES) than envisaged in the 2012 FSA.

Meantime, the draft shipbuilding plan says that since the 2012 FSA was completed there have been some minor adjustments in the Navy’s forward deployed posture, warfighting prioritization, and structure that have seen the 2012 FSA objective for 306 ships increased to 308 as a result of these changes. Here’s what they consist of:  Fleet ballistic missile submarines: 12; Nuclear-powered aircraft carriers: 11; Nuclear-powered attack submarines: 48; Nuclear-powered cruise missile submarines* 0;  Large, multi-mission, surface combatants: 88; Small, multi-role, surface combatants: 52; Amphibious Warfare ships: 34;Combat logistics force ships: 29; Support vessels: 34.

While all this is aimed at producing pretty much the fleet seen as needed in the 2012 FSA, it seems evident that the next FSA will actually result in a requirement for a larger battle force.

LAWMAKERS SEEK MORE SHIPS
The FY 2017 Defense Authorization Act is now churning through the Congressional hopper and legislators are intent on getting ahead of the curve.

But you don’t always get what you ask for—and when it comes to Navy shipbuilding and Congress sometimes it will be just a bit different, even when it’s more.

The House last month authorized $20.6 billion for shipbuilding, $2.3 billion above the President’s budget. As we’ll discuss later, how it wants to find the money is controversial and sets things up for resolution by a House-Senate conference and possibly even a veto.

Seapower and Projection Forces Subcommittee Chairman Rep. Randy Forbes, (R-VA) says that between the shipbuilding account and the National Sea-Based Deterrence Fund (set up in the FY 2015 act as a holding fund dedicated to the Ohio replacement ballistic missile submarine program), that $20.6 billion is the highest level of shipbuilding funding, accounting for inflation, since President Reagan was in office.

In addition to shifting the amount requested by the President for the Ohio replacement into the NSBDF, the House measure expands the authorities in the NSBDF to include “continuous production” of Ohio class replacement submarines, allowing the Navy to procure components such as missile tubes at substantially lower cost.

Additionally, the measure:

  • Preserves the 10th aircraft carrier air wing;
  • Authorizes the construction an amphibious assault ship, LHA (8);
  • Authorizes the refueling and complex overhaul (RCOH) of five aircraft carriers;
  • Retains 11 cruisers in the fleet that the Navy proposed to induct into long-term modernization;
  • Prohibits the retirement of mine countermeasures ships until replacement capability is fielded;
  • Funds an additional amphibious ship to address the shortfall against the Marine Corps’ requirements;
  • Funds another destroyer to better support Navy operations in a contested environment;
  • Funds advanced procurement for CVN-81 to support a move to four-year centered carrier construction and to create economies with CVN-80;
  • Authorizes the construction of a National Security Multi-Mission Vessel; and
  • Funds another LCS, taking the FY 2017 total to three.

The House measure also includes an amendment by Rep. Bradley Byrne (R-AL) that would prevent any funds from being used to “select only a single contractor for the construction of the Littoral Combat Ship or any successor frigate class ship program” until the Secretary of the Navy certifies a number of requirements to Congress—effectively delaying progress on the Navy’s down select from two LCS variants to one until the next administration takes office.

SENATE VERSION STILL IN WORKS
Right now, the Senate Armed Services Committee’s version of the Act was coming up for consideration by the full Senate. As drafted, it contains a number of similarities to the House version, with one major difference being the future of the LCS.

Among other items on the committee’s list:

  • $5 billion to procure two Virginia-class nuclear attack submarines and provide for advance procurement of future Virginia-class submarines;
  • $1.6 billion to procure the next amphibious assault ship, including incremental funding authority for FY 2017 and FY 2018;
  • $1.5 billion to fully support the Ohio-class submarine replacement program.
  • $3.3 billion for the procurement of two Arleigh Burke-class destroyers, including a $50 million increase for incremental funding of a fiscal year 2016 destroyer;
  • $75 million for the development and procurement of the amphibious ship replacement, known as LX(R); and
  • $199 million in Chief of Naval Operations and Commandant of the Marine Corps unfunded priorities, including: a ballistic missile defense destroyer upgrade, surface electronic warfare improvement program block 3 installation, and a surveillance towed array, and F-35B spares.

In provisions relating to the Ford-class Aircraft Carrier, the Senate Arms Service Committee version directs a review of the ships’ Advanced Arresting Gear (AAG) program and meantime prohibits future AAG procurement funding, saying, the acquisition “unit cost of this troubled program has breached critical cost growth thresholds, warranting a reassessment of the program and a consideration of alternatives.”

It limits funds until the Navy establishes lower end cost targets of $11 billion and $12 billion for the USS John F. Kennedy

(CVN-79) and USS Enterprise (CVN-80), respectively.

There’s no good news for LCS fans in the Senate. Its bill prohibits revisions to or deviations from the current LCS acquisition strategy, which includes procurement of both LCS designs in 2017, a down-select to a single variant no later than 2019, and a reduction in the inventory objective to 40 ships.

It also reduces authorization for the LCS by $28 million “due to unjustified unit cost growth” and cuts $59 million for LCS mission packages.

What’s more, it prohibits the use of funds to enter into or prepare to enter into a sole-source contract for a Joint High Speed Vessel (JHSV) or Expeditionary Fast Transport (EPF).

“In the last two years, funds were appropriated for two of these ships that Navy did not request and were not authorized by the NDAA,” says the committee. “This provision is a necessary safeguard to prevent wasteful earmarks.”

The Senate measure directs the Secretary of the Navy to report to Congress on how the Navy will transition the Ohio-class replacement submarine program from cost-plus to fixed-price contracts as soon as possible.

Picking up on a March 2016 GAO report that said the Navy should reconsider its approach to warranties for correcting construction defects, the Senate Armed Services Committee draft “directs the Secretary of the Navy to structure contract terms such that shipbuilders do not earn profit for correcting construction deficiencies following delivery that are determined to be their responsibility.”

The Senate version authorizes an extension to a Jones Act waiver pertaining to the procurement of dry docks, which would be necessary to build Navy ships.

The Senate Armed Services Committee measure also would slow the Navy’s efforts to take existing ships out of service. The measure would: 1. Prohibit funds from being used to inactivate guided missile cruisers or dock landing ships or place ships in these classes into an extended modernization period, unless prescribed criteria are met; and 2. Prohibit funds from being used to inactivate existing mine countermeasures systems until equivalent or better capabilities are fielded.

PAYING FOR IT ALL
While the levels of both House and Senate Armed Services Committees’ total defense budget proposals are line with the Administration’s total, the House version only does so with a bit of smoke and mirrors: it funds the Pentagon’s Overseas Contingency Operations (OCO) only until April 20, saying “The Chairman’s expectation is that a new President will assess the national security landscape and submit a supplemental budget request—as is traditional in the first year of a new administration.”

Calling that move “budget gimmickry,” Secretary of Defense Ash Carter said, in a speech delivered May 17, that “it raids war funds in a time of war, when we have men and women deployed in operations in Afghanistan, Iraq and Syria. It also threatens the budget stability that undergirds all of the reforms, investments and initiatives that the Pentagon has been working on. And it threatens the readiness of the force—an actual contrast to the narrative its proponents propound.”

Secretary Carter noted that the passage of last fall’s Bipartisan Budget Act “gave us some much needed stability to plan and build for the future, after years of gridlock and turbulence.”

“That budget deal set the size of our budget,” he continued, “and with this degree of certainty, we focused on its shape and building the FY 2017 budget we’ve submitted and I’ve described—changing that shape in fundamental but carefully considered ways to adjust to a new strategic year end to seize opportunities for the future.

“But the budget stability that was supposed to last for two years is already under threat after only six months with a proposal to underfund DOD’s overseas warfighting accounts by $18 billion and spend that money on programmatic items we didn’t request. This approach is deeply troubling.

“If a final version of the NDAA reaches the President this year and includes a raid on war funding that risks stability and gambles with war funding, jeopardizes readiness and rejects key judgments in the department,” said Secretary Carter, “ I’ll be compelled to recommend that he veto the bill. I’m hopeful, however, that we can work with Congress to achieve a better solution. Our warfighters deserve nothing less because our mission is a deadly serious one.”

Orders for new ships slow, but U.S. owners active in sales and purchase

The total capacity of these vessels is just over 7 million deadweight tons (dwt), with a total current value of $4.5 billion (See Table 1: Value of U.S.-Built Shipping). Globally, the United States (as a shipbuilding nation) is ranked in 11th place (in terms of dwt) and a respectable sixth place behind South Korea, Japan, China, the Philippines, Germany, and Turkey in terms of the current value of the U.S. built fleet. Based on the volume of ships on the water, the most prolific U.S. shipbuilder has been NASSCO, San Diego, CA, a unit of General Dynamics. NASSCO also operates shipyards on the U.S. East Coast in Mayport, FL, and Norfolk, VA. As of mid-March, VesselsValue estimated the ships being built at NASSCO had values of around $900 million (this value excludes delivered ships). NASSCO recently launched the 53,700 dwt MR tanker Independence, which VesselsValue currently values at $133.45 million (this excludes a premium for the Jones Act). The Independence will be joined by two MR2 tankers on order at NASSCO for Seabulk Tankers. As of mid-March, NASSCO had four MR2 tankers on its order book for American Petroleum Tankers.  Charts Shipbuilding

The San Diego shipyard delivered two LNG-fuelled 3,100-TEU containerships, including the lead of the Marlin class, the Isla Bella, in November 2015 to Tote Maritime. The Isla Bella, along with its sister, Perla dela Caribe, are now operating between Jacksonville, FL, and San Juan, PR.

The only other U.S. shipyard with bulker, tanker, and gas carrier vessels currently on its order book is Philly Shipyard, Philadelphia, PA (formerly known as Aker Philadelphia Shipyard Inc.) Philly Shipyard has built product tankers, crude carriers, and containerships. The Philly Shipyard built fleet is currently valued at just over $1 billion. Its order book consists of eight 50,000 dwt MR tankers and this design has been classed by ABS as LNG Ready, which provides the owner with the flexibility to choose to convert the ship to dual fuel operation in the future.

In early May, Crowley Maritime Corporation christened the Louisiana, third of four LNG Ready product tankers at the Julia Street Cruise Terminal in New Orleans, LA.

Like its sisters, the 600 ft Louisiana is based on a proven design from Korea’s Hyundai Mipo Dockyards (HMD) design. It can carry crude oil or refined petroleum products, as well as other chemical products. 

Construction management services were provided by Crowley’s marine solutions group, which provides oversight and management in shipyards across the country for Crowley and other third-party companies. Philly Shipyard also built the tankers Texas and Ohio for Crowley, and the fourth ship in the program is under construction with delivery planned for third quarter 2016.

“The christening underscores our continued commitment to building and operating innovative vessels that deliver the best possible service and efficiency for our customers who depend on us for safe and reliable transportation of petroleum products,” says Rob Grune, Senior Vice President and General Manager, Petroleum Services. “And, as is the case with its sister ships, we designed and built the Louisiana to have the capability to be converted to LNG propulsion in the future, increasing the likelihood of a long service life as new emissions regulations are developed in the years ahead.”

JONES ACT FLEET CONSIDERABLY OLDER THAN WORLD FLEET
It’s no secret that the U.S. Jones Act fleet is considerably older than the average age of the global, non-U.S.-built fleet. The current U.S.-built fleet has an average age of 33 years old versus 13 years old for the global fleet. The most recent ships produced by U.S. shipyards have been tankers and the average age of U.S.-built tankers is only five years older than the global fleet. However, there has been virtually no U.S. investment in bulkers (many of them are part of the Great Lakes fleet). The U.S.-built bulker fleet has an average age of 46 years old versus nine years old for the global fleet. Even a relatively modern ship type, such as containerships, the average age of the U.S.-built fleet is 32 years old, considerably older than the average of 11 years old for non-U.S.-built vessels.

TOP TEN U.S. SHIPOWNERS
According to VesselsValue, the Top Ten U.S. shipowners ranked by value control around half the capacity (48%) of the U.S. fleet (see Table 2. U.S. Shipowners Ranked by Fleet Value).

The Top Ten Shipowners are tanker companies or the tanker arms of oil majors. The current most valuable U.S.-operated fleet is that American Shipping Co., a Norwegian public company controlling a fleet of 10 MR2 tankers built by Philly Shipyard and leased out to OSG, which charters them out to Jones Act qualifying companies. VesselsValue estimates this fleet is worth $830 million. The second most valuable U.S. fleet belongs to new entrant American Petroleum Tankers, which is a subsidiary of Kinder Morgan Terminals, with its fleet operated by Crowley Maritime Corporation, Jacksonville, FL. This fleet will be supplemented by MR tankers currently on the order book of NASSCO. However, in the last 12 months, the U.S. order book has been very quiet, with no bulker, tankers or gas carriers ordered.

SALE AND PURCHASE ACTIVITY
If there is one area where U.S. shipping has been active, it’s been in the sale and purchase market. The dire dry bulk market is one of the driving forces behind Scorpio Bulker selling 25 vessels in the last 12 months (March 2015 to March 2016) for a combined value (at the time of sale) of $878 million (where the sale price is undisclosed, the VV Value the day of the sale is used). Altogether 88 vessels have been sold by U.S. owners for a combined value (where the sale price is undisclosed, the VV Value the day of the sale is used) of $3.4 billion (see Table 3: Sales by U.S. Owners).

Of course, under the Jones Act, U.S. companies cannot purchase foreign-built vessels to operate in Jones Act trade routes. This reduces the pool of potential purchases, which in the last 12 months (March 2015-March 2016) have been limited to eight vessels, including four MR tankers from Philly Shipyard purchased by Kinder Morgan for a reported $568 million (See Table 4: Purchases by U.S. Owners).