Jones Act

NASSCO launches first SEA-Vista ECO tanker

SEA-Vista is a partnership between SEACOR Holdings Inc. and private equity firm Avista Capital Partners. Its ships will be operated by SEACOR subsidiary Seabulk Tankers, Inc.

The Independence is a 610-foot, 50,000 deadweight-ton, and LNG-conversion-ready Jones Act product tanker with a 330,000 barrel cargo capacity. Construction on the ship began in November 2014.

As part of the ceremony, the ship’s sponsor, Mrs. Allison Moran, CEO of RaceTrac Petroleum, christened the ship with a traditional champagne bottle break over the ship’s hull. Mrs. Jayne Rathburn, former CEO/owner of US Joiner, pulled the trigger to release the ship into the San Diego Bay.

“General Dynamics NASSCO shipbuilders are revolutionizing the future of American shipping with the concept and construction of innovative, cost-saving, and environmentally-sound vessels,” said Kevin Graney, vice president and general manager for General Dynamics NASSCO. “When delivered, these ECO Class, Jones Act-qualified tankers will be among the most fuel-efficient and environmentally-friendly tankers anywhere in the world.”

“We are pleased to complete this important milestone for the first in a series of three fuel-efficient, ECO Jones Act product tankers that will be delivering into the SEA-Vista fleet and operated by Seabulk Tankers, Inc,” said Daniel J. Thorogood, president and chief operating officer for Seabulk Tankers, Inc.

For its commercial work, NASSCO partners with South Korea’s Daewoo Shipbuilding & Marine Engineering (DSME), for access to state-of-the-art ship design and shipbuilding technologies.

 

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International Shipholding reports on streamlining

 

It reports that it has executed a Memorandum of Agreement and buyers have lodged the required deposit for the sale of the international-flag PCTC Glovis Countess. Delivery of the vessel is scheduled to be completed by December 31, 2015. Excess cash after debt payoff of approximately $16 million will be maintained by the company for general corporate purposes.

The company has also executed Memoranda of Agreement for the sale of its two handysize vessels and one capesize vessel for approximately $30 million. Deliveries of the vessels are scheduled to be completed prior to January 31, 2016. All net proceeds from the sale of these vessels will be used to pay down outstanding debt.

The company is in discussions on the sale of its supramax vessel and its railcar service facility (FSI) in Mobile, AL. All net proceeds from the sales will be used to pay down outstanding debt.

Mr. Niels M. Johnsen, Chairman and Chief Executive Officer, said, “As we continue to streamline International Shipholding, we are focused on completing the implementation of our Strategic Plan in an expeditious, but orderly, manner. We continue to market all of the remaining assets to be divested pursuant to our Strategic Plan, and we will provide further periodic updates as we continue to make progress towards our March 31, 2016 target for full implementation.å

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Great Lakes bulker operator reports increased net

Before a tax benefit of approximately $0.22, net income per share increased to $0.36 on a fully diluted basis or 12.5% over the prior year period.

“The 2015 sailing season has remained consistent with our initial outlook,” commented Ed Levy, President and CEO of Rand. “We continue to focus our efforts on the factors of our business that we can control. We have experienced continued improvement in the key operating and financial metrics that drive our business, including lower vessel delays and days out of service, combined with improvements in tons hauled, freight and related revenue, and vessel margin per day. The year to date financial impact of these improvements has been masked by a 14% decline in the value of the Canadian dollar versus the U.S. dollar compared to last sailing season.”

Through its subsidiaries, Rand Logistics operates a fleet of four conventional bulk carriers and twelve self-unloading bulk carriers including three tug/barge units. The company is the only carrier able to offer significant domestic port-to-port services in both Canada and the U.S. on the Great Lakes. Its vessels operate under the U.S. Jones Act – which reserves domestic waterborne commerce to vessels that are U.S. owned, built and crewed, – and the Canada Coasting Trade Act – which reserves domestic waterborne commerce to Canadian registered and crewed vessels that operate between Canadian ports.

Freight and other related revenue from company operated vessels (which excludes fuel and other surcharges) decreased $2.3 million, or 4.9%, to $43.8 million during the three-month period compared to $46.1 million in the year ago period. On a constant currency basis, freight and other related revenue increased 4.0%, or $1.9 million.

Total Sailing Days were 1,278 compared to 1,351 in the prior year. The 73-day decline in sailing days was due to 92 lost days attributable to the company’s time chartered bulk carriers. Although these vessels did not operate for the entire quarter, Rand continued to receive daily charter payments at a reduced rate. These lost days were partially offset by a 19 day reduction in days out of service.

Delay Days decreased to 68 from 72. Delay Days as a percentage of total Sailing Days remained relatively constant year over year.

Freight and related revenue per Sailing Day increased $176, or 0.5%, to $34,300 compared to $34,124 per Sailing Day in the year ago period. On a constant currency basis, freight and related revenue per Sailing Day increased 10.0%, or $3,409.Vessel operating expenses decreased $3.6 million, or 10.7%, to $30.0 million compared to $33.6 million during the year ago period. Vessel operating expenses per Sailing Day decreased $1,381, or 5.6%, to $23,498 from $24,879 during the year ago period. On a constant currency basis, vessel operating expenses per Sailing Day decreased 0.9%, or $0.3 million.

Adjusted EBITDA decreased $1.3 million, or 7.3%, to $16.1 million from $17.4 million during the year ago period. On a constant currency basis, Adjusted EBITDA increased 2.0%, or $0.3 million.

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LNG fuel tanks installed in first Crowley ConRo

Another important milestone was marked last week, with the installation of three LNG fuel tanks in the first ship.

The double-walled, stainless steel tanks – which are 110 feet in length and 20.6 feet in diameter – weigh 225 metric tons and will hold more than enough LNG fuel for two round-trip voyages between the vessel’s future ports of call, Jacksonville, FL, and San Juan, Puerto Rico.

“While we are all excitedly watching these ships take shape, we are particularly proud of the role we, as a company, are playing to bring the most modern, technologically advanced and environmentally friendly ConRo ships in the world to the Jones Act market of Puerto Rico,” said Tom Crowley, company chairman and CEO. “There are no other ships of their kind being built anywhere else in the world today, and they are being constructed right here at home – in the United States of America. Having that shipbuilding capability here is essential to our national defense and an important reason we as a country need the Jones Act to be maintained and strengthened.”

Crowley’s two Jones Act ConRo ships, which will be named El Coquí (ko-kee) and Taíno (tahy-noh), are are scheduled for delivery second and fourth quarter 2017 respectively.

“It’s very impressive to see these new state-of-the-art Commitment Class ships take shape,” said John Hourihan, senior vice president and general manager, Puerto Rico services. “Seeing those LNG tanks being placed into El Coquí really resonates with me because we are setting a new standard for environmentally responsible shipping.”

The Commitment Class ships have been designed to maximize the carriage of 53-foot, 102-inch-wide containers, which offer the most cubic cargo capacity in the trade.

The ships will be 219.5 meters long, 32.3 meters wide , have a deep draft of 10 meters, and an approximate deadweight capacity of 26,500 metric tonnes. Cargo capacity will be approximately 2,400 TEUs (20-foot-equivalent-units), with additional space for nearly 400 vehicles in an enclosed Ro/Ro garage.

Each ship will be powered by an MAN B&W 8S70ME-GI8.2 main engine and three MAN 9L28/32DF auxiliary engines, all fueled by LNG .

The ship design is provided by Wartsila Ship Design in conjunction with Crowley subsidiary Jensen Maritime.

ceowleyLNG vert

NASSCO christens first Kinder Morgan ECO tanker

San Diego Mayor Kevin Faulconer spoke at the ceremony, and the ship’s sponsor, Mrs. Helen Downs, christened the ship with the traditional breaking of a champagne bottle.

 

The ECO tanker, the Lone Star State, is the first of a five-tanker contract between NASSCO and APT, which calls for the design and construction of five 50,000 deadweight ton, LNG-conversion-ready product carriers with a 330,000 barrel cargo capacity. The 610-foot-long tankers are a new “ECO” design, offering improved fuel efficiency and the latest environmental protection features including a Ballast Water Treatment System.

The ships were designed by DSEC, a subsidiary of Daewoo Shipbuilding & Marine Engineering (DSME) of Busan, South Korea. The design incorporates improved fuel efficiency concepts through several features, including a G-series MAN ME slow-speed main engine and an optimized hull form. The tankers will also have dual-fuel-capable auxiliary engines and the ability to accommodate future installation of an LNG fuel system.

“Incorporating new and innovative green ship technology, these tankers are the future of American petroleum shipping. When delivered they will be among the most fuel-efficient and environmentally friendly tankers anywhere in the world,” said Kevin Graney, general manager and vice president for General Dynamics NASSCO.

“This christening ceremony is an important step forward for Kinder Morgan’s expanding fleet of Jones Act product tankers and demonstrates the strong demand for domestic waterborne transportation to move petroleum products and crude oil,” said Robert Kurz, vice president of Kinder Morgan Terminals and president of American Petroleum Tankers. “We look forward to taking delivery of this vessel next month and, along with our seven other operating tankers, providing first-class service to our growing customer base.”

In September 2014, Mayor Faulconer signaled the start of construction of the ECO tanker. In March 2015, San Diego’s First Lady and wife of Mayor Faulconer, Mrs. Katherine Faulconer, laid the keel.

“The Lone Star State is a great example of the kind of innovative technology being employed by NASSCO and our blue tech industry. Its construction has employed hundreds of San Diegans and helped sustain jobs for thousands more,” Mayor Faulconer said. “This ship is a symbol of the jobs and opportunities the maritime industry brings to our city.”

On Friday, October 16, NASSCO shipbuilders began construction on a fifth tanker for APT.

Aker Philly cuts steel for two more Kinder Morgan tankers

Construction on the two Jones Act vessels officially began in the shipyard’s fabrication shop when guest of honor Pennsylvania Lieutenant Governor Mike Stack pushed the button on the shipyard’s plasma cutting machine. The first steel plates that were cut will later become part of the engine room.

At the ceremony, the shipbuilder’s President and CEOI, Steinar Nerbovik, said: “With construction underway on these two product tankers, we celebrate the capstone of an exciting eight tanker series that is part of Philadelphia’s contribution to the energy landscape of this country. The 1,100 men and women working at the shipyard will be busy for years to come completing these tankers and the other vessels we have under contract.”

“We are very pleased to be working with the Aker Philadelphia Shipyard on the construction of four, LNG-conversion-ready tankers, and the start of construction of these two vessels marks a milestone for our expanding fleet,” said Robert Kurz, Vice President of Kinder Morgan Terminals and President of APT. “There continues to be a strong demand for domestic marine transportation of petroleum products and crude oil, and these tankers will provide Kinder Morgan with additional new tonnage to better service our customers.”
The next generation 50,000 dwt product tanker is based on a proven Hyundai Mipo Dockyards (HMD) design that incorporates numerous fuel efficiency features, flexible cargo capability, and the latest regulatory requirements. When completed, each of the 600-foot tankers will have a carrying capacity of 14.5 million gallons to transport crude oil or refined products.

Also under construction at the shipyard are three 50,000 dwt product tankers for Crowley with planned deliveries through 2016, the first two 50,000 dwt tankers for APT with planned deliveries in 2016 and 2017, and two containerships for Matson Navigation Company, Inc. with planned deliveries in 2018.

Aker Philadelphia cuts steel for Matson 3,600 TEU box ships

In 2013, Matson subsidiary Matson Navigation Company, Inc. signed a contract with Aker Philadelphia Shipyard Inc. (APSI) to build the two new ships for a price of $418 million for the pair (see earlier story). Since signing the contracts, engineering, planning and procurement work have been underway.

The shipbuilder is expected to deliver the ships in the third and fourth quarters of 2018.

The 850-foot long, 3,600 TEU vessels will be Matson’s largest ships and the largest Jones Act containerships ever constructed. Despite their size, they are designed to accommodate future needs by being able to navigate safely into some of Hawaii’s smaller ports.

They will also be faster, designed to operate at speeds in excess of 23 knots, helping ensure timely delivery of goods in Hawaii.

The new vessels will incorporate a number of “green ship technology” features including a more fuel efficient hull design, dual fuel engines that can be adapted to use liquefied natural gas (LNG), environmentally safe double hull fuel tanks and fresh water ballast systems.

“These new ships are the future for Hawaii shipping and will bring a new level of efficiency and effectiveness to our service,” said Matt Cox, president and CEO, Matson. “The substantial investment in new technology underscores Matson’s long-term commitment to Hawaii and our desire to serve the islands in the best, most environmentally friendly way into the future.”

The first ships to be delivered by Aker Philadelphia were four Jones Act containerships for Matson delivered between 2003 and 2006.

“We are excited to partner with Matson again and return to our construction roots building containerships,” said Aker Philadelphia President and CEO Steinar Nerbovik. “It’s an exciting time to be a shipbuilder as we embark on simultaneously building containerships and product tankers, fulfilling our commitments to customers and shareholders.”

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Duncan Hunter honored as Champion of Maritime

 

AMP says that Rep. Hunter’s longstanding support for the domestic industry is demonstrated through his work as Chairman of the Subcommittee on Coast Guard and Maritime Transportation and as a member of the Seapower Subcommittee of the House Armed Services Committee. AMP adds that as the first U.S. Marine Corps combat veteran of the wars in Iraq and Afghanistan elected to U.S. Congress, Rep. Hunter understands the importance that the maritime industry serves in the everyday lives of our civilians and our service men and women.

“The true champions of maritime are the hundreds of thousands of highly-skilled service men and women in the American maritime industry who tirelessly work to protect our waterways — such a strength in defense wouldn’t be possible without the Jones Act,” said Rep. Hunter in accepting the award. “I will continue to vocalize my support for the American maritime industry; one that creates good paying family -wage jobs, secures our borders, and fuels our economy.”

This past June, Rep. Hunter demonstrated his commitment to the U.S. maritime industry when he joined hundreds of veterans and active military at the American Maritime Partnership’s Military to Maritime career fair in San Diego where he met with men and women looking to transfer their specialized skills earned from the military into a lucrative career in U.S. maritime.

“Chairman Hunter has been a tremendously valued champion for the domestic American maritime industry, serving as a leader who truly understands our industry’s critical role to the vitality and security of our nation,” AMP Chairman Tom Allegretti said. “From his time in the service to his seat as Chairman of the Subcommittee on Coast Guard and Maritime Transportation, Congressman Hunter has witnessed first hand what it takes to sustain a strong maritime industry and because of his dedication, we are honored to provide him with our highest honor – the Champion of Maritime Award.”

 

Marathon buys Aker Philly interest in four newbuilds

 

This follows last month’s news that Kinder Morgan, Inc. (NYSE: KMI) had agreed the four Jones Act tankers building for the shipyard’s wholly-owned U.S. subsidiary, Philly Tankers LLC.

Marathon’s buy-out of APSI’s interest in the Crowley joint venture with respect to each vessel will occur on its delivery from the shipyard. Deliveries of all four vessels are expected to occur from Q3 2015 to Q3 2016. APSI expects to recognize a pre-tax gain of approximately $10 million per vessel from the transaction.

APSI will make an investment in the vessels during their construction, but will no longer maintain the previously planned long-term investment in the vessels post-delivery, which was expected to be approximately $110 million in the aggregate.

“This transaction is an important part of AKPS’s plan to divest its shipping investments and realize the value created for shareholders,” said Kristian Rokke, Chairman of AKPS. “We are proud of what we have accomplished together with Crowley under the joint-venture and look forward to serving both Crowley and Marathon Petroleum as shipbuilders into the future.”

All four of the vessels subject to the transaction are under construction. APSI has also begun construction of the first two of four additional 50,000 dwt tankers for a subsidiary of Kinder Morgan, Inc., which are planned to be delivered between November 2016 and November 2017.

The shipyard also has contracts for two 3,600 TEU containerships for Matson Navigation Company, Inc., which are planned to be delivered in 2018.

On July 16, 2015, the company announced that it intends to change its name to Philly Shipyard by the end of the year, pending shareholder approval.

VIDEO: Crowley’s LNG fueled ConRo now 25% complete

 

First steel for the ship was cut in October 2014 and it is now 25 percent complete.

“Week by week, we have watched the pair of Commitment Class ships begin to take shape,” said John Hourihan, senior vice president and general manager, Puerto Rico/Caribbean liner services. “It’s been incredible to watch. Once fully constructed, these new vessels will embody superior technology and construction and, while we are anxious to get them into service for our partners in Puerto Rico, we are thrilled that they are coming together on schedule.”

“The entire team at VT Halter Marine is pleased and proud to be partnered with Crowley in the construction of these magnificent ships,” said VT Halter Marine President and CEO Jack Prendergast. “It is a pleasure to see the hard work of the Crowley/Halter team come to fruition.”

The ships will be 219.5 meters long, 32.3 meters wide (beam), have a deep draft of 10 meters, and an approximate deadweight capacity of 26,500 metric tons.Cargo capacity will be approximately 2,400 TEUs (20-foot-equivalent-units), with additional space for nearly 400 vehicles in an enclosed Roll-on/Roll-off garage.

Each ship will be powered by an MAN B&W 8S70ME-GI8.2 main engine and three MAN 9L28/32DF auxiliary engines fueled by LNG.

The ship design is provided by Wärtsilä Ship Design in conjunction with Crowley subsidiary Jensen Maritime, a leading Seattle-based naval architecture and marine engineering firm.

The Commitment Class, Jones Act ships will replace Crowley’s towed triple-deck barge fleet, which has served the trade continuously and with distinction since the early 1970s. These new ships will offer customers fast ocean transit times, while accommodating the company’s diverse equipment selection and cargo handling flexibility. El Coquí and Taíno are scheduled for delivery second and fourth quarter 2017 respectively.

Designing, building and operating LNG-powered vessels is in line with Crowley’s overall EcoStewardship positioning and growth strategy. The company formed an LNG services group earlier this year to bring together the company’s extensive resources to provide LNG vessel design and construction management; transportation; product sales and distribution, and full-scale, project management solutions.

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