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05 June 2023 - Year XXVII
Independent journal on economy and transport policy
15:03 GMT+2
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FORUM of Shipping
and Logistics


The Offshore and Specialised Ships market
in 2000

 

At the beginning of 2000, crude oil prices broke through the barrier of $25 per barrel and hit a peak of $36 per barrel in September, close to the highs experienced at the time of the Gulf War. Since then there has been a drop back to $26 per barrel in December. Producers and experts alike are basing their medium term forecasts on a price around $25 per barrel, and at this level it should encourage a substantial increase in exploration budgets and offshore production (for reference, the estimate for last year was $12-15 per barrel).

We leave it to the oil specialists to give an explanation for the real reasons of this sudden surge in prices, but we have nonetheless taken note that the current projections on proven crude oil reserves are not as important as the experts have led us to believe.

Meanwhile, specialised geophysicists are intensifying their efforts with the help of 3D techniques and have perfected computer software which allows enormous progress in interpreting seismic tests and which assists the development of new deep offshore fields.

It is reasonable to expect that exploration budgets will be increased and that they will return to a level above $100 billion in 2001, with a particular emphasis being directed towards the deep seabed. These new offshore drillings, require not only more important and sophisticated techniques for drilling and producing, but also the need of bigger, more numerous and more powerful workships and transport ships.
 

Support vessels: Platform supply vessels (PSV) and Anchor handling tug supplies (AHTS)

top

Players in this market were pessimistic in January 2000 but the important drop in freight rates at the beginning of the year was partly compensated by the increased chartering of supply vessels specialised in pre and post laying of optical fibre cables.

The market had to wait until the autumn in order to see a significant improvement in freight rates, but it then only took a month before the levels of different categories of supply ships increased. Against expectations, it was the prices in the Gulf of Guinea which were the signal for this general firming up.

A greater number in the movements of supply ships and the fact that several PSV were taken out of the market and used for cable laying, as well as the dispatch of some units towards the deep offshore African sites in the spring of 2000, upset the North Sea spot market and charter rates started to take off. The market hit a high in the summer with spot levels touching '20,000 per day.

Given the context described above, this has produced a number of newbuildings of PSV and AHTS on behalf of Norwegian and American owners. In contrast to the wave of newbuildings in 1996-98, orders of some 80 units cover the whole spectrum of the fleet. In particular there have been a number of medium-size vessels in the UT 719/755 class of 4-5,000 kW.

This revival in the offshore markets and the prospects of a drop in subsidies to European and especially Norwegian shipyards has largely contributed to an unprecedented surge in renewing and modernising of the fleet of the main players (Gulf Offshore, Tidewater, Surf, Dof, Solstad, Farstad, Swire Pacific, Sealion).

In particular we have observed a policy of aggressive expansion from the world's largest owner of supply vessels (Tidewater, based in New Orleans with over 600 units) who purposefully kept out of building any new vessels in recent years, has ordered a number of units in the UT 755 class for construction in Norway. In addition the company has bought six modern units from the Japanese Sanko for a sum of $ 160 million. Tidewater has also placed orders in the US and China for more than 12 big-sized PSV and AHTS.

Gulf Offshore Aberdeen, a subsidiary of Gulf Mark Offshore USA, ordered at the end of the year seven AHTS and PSV types UT 722L, UT 755, UT 755L, and UT 745 with Aker Brattvaag in Norway to replace the Sanko ships, sold as mentioned above, that they had under bareboat charter.

Another fact worth mentioning is the success of the Norwegian engineering companies such as Rolls Royce Marine AS (ex-Ulstein, ex-Vickers) and Vik Sandvik, who have managed to impose their concepts and designs of support ships on owners and shipyards worldwide.

Surf is continuing to develop with its local partners its foothold in Angola and will be putting into service in 2001 two Azimuth tugs of 65 tons bollard-pull being built with Damen, Holland, as well as a PSV (UT 755) being built with Orskov in Denmark within their service contract with Sonagal/TotalFinaElf. An additional UT 755 has been placed with Orskov on speculation.

The year 2001 looks encouraging for shipowners and owners of floating equipment designed for drilling and producing offshore in West Africa, Brazil, and the Gulf of Mexico. It would appear that ships which are dynamic positioning and can handle ROV operations and underwater work will be hard to find.
 

ABEILLE FECAMP
2 x 2,500 bhp, built by Alstom Leroux Naval - Operated by Les Abeilles Le Havre.
Drilling top

The merger tendency has continued with the birth in 2000 of a drilling giant following the take-over of Reading and Bates/Falcon by Transocean-Sedco. In the longer term, drilling rig operators are expected to consolidate into four or five companies which will represent at least 80 % of mobile units.

The turnaround in the offshore markets was felt first in the shallow water drilling. In practice the jack-up rigs have seen their utilisation rate climb during 2000 to levels today around 90 %. The high levels of use gives owners hope of seeing a strong rise in the chartering rates for 2001. We have also seen a number of speculative orders of new jack-up rigs which have already been placed with the main yards, Chile Offshore with FELS, Maersk Drilling with Hyundai Offshore, and finally a 25 % share purchase by Enesco in a building unit with FELS based on a standard design of F&G MODV.

Santa Fe made a name for itself with an ambitious newbuilding programme comprising two new semi-submersibles and six new jack-up rigs.

This year also saw the delivery of the last drilling units due to be built. Generally their owners were faced with the classic problem of the initial servicing of these new units.

The second-hand market saw a few unspectacular deals but which underlined the basic optimism of owners and the healthy state of their cash-flows. Pride bought two second generation semi-submersibles, the 'Drillstar' and the 'Sedco Explorer', both having been in the hands of American private investors, as well as a jack-up rig ' the 'Energy Explorer IV'. Fred Olsen through its affiliates Fred Olsen Energy and Dolphin Drilling also purchased two second generation semi-submersibles of the Aker H-3 class which are compatible with the original design of units in service with the Dolphin Drilling fleet. In addition this company took a majority shareholding in Navis Asa, a Norwegian company that controls the 'Navis Explorer' a new drillship built by Samsung.

To the extent that there are virtually no builders of mobile drilling rigs left in Europe, we question what will be the reply from the three main Asian yards when all the service companies start making commitments for newbuildings in reply to the oil companies' tenders. This situation could also be aggravated by the current consolidation amongst builders. On the one hand, Friede and Goldman (USA) has become the uncontested leader in the design and construction of drilling units, and the group Keppel-FELS has undertaken joint ventures and take-overs in order to operate on the Brazilian and Azeri markets, and they envisage also becoming the main shareholders in Verolme Botlek, leader in repairs and refitting of drilling units in Europe.


 

Construction and underwater work top

The year 2000 saw reduced activity in this sector as the oil companies' investment budgets were put on hold. This depressive mood led to a number of mergers which in turn has brought about a wholesale reorganisation in this area of the offshore industry.

Coflexip Stena Offshore bought at the start of the year R H Brown, Houston, and at the year's end took over Aker Offshore, Houston, the subsea construction branch of the Aker Maritime Group, which through their American holding will give them a better position in the Gulf of Mexico. Coflexip then sold its share in CAL Dive, Houston. Technip bought Stena Offshore's part in CSO, and the Technip and Coflexip combination appears promising as the activities of the two companies are complimentary. Bouygues Offshore and Doris are looking to combine their efforts in the Gulf of Mexico with the setting up of a single affiliate in Houston.

Stolt Offshore has carried through the purchase and integration of ETPM, despite indifferent results, and we expect to see an ambitious development on the part of this operator. We would like to end this section by outlining the increasing use by the large underwater companies of sub-contracting or outsourcing non-core activities to owners such as Solstad, Farstad, Augusta, or Surf.

Dredger Artist view of dredger
to be delivered in 2002 by Izar to GIE Dragages Ports.

 

Floating production storage and offloading vessels (FPSO)

top

Oil companies have also increased their investments in this sector of the offshore market, linked to the production of oil and gas. The floating production systems will be mainly located in the future in the offshore fields in West Africa (ex-Girassol in Angola) and Latin America (ex-Marlim Sul in Brazil), in depths of 500-1,300 metres. The North Sea fields have been fully equipped for some time and the American authorities prohibit the use of floating production systems in the Gulf of Mexico waters, where they have been replaced by a system of storage fixed to the seabed under tension and where the underwater pipeline network is dense enough to permit connections. The MAD DOG project being developed by BP will perhaps see the first new FSO operational in the Gulf of Mexico.

Generally speaking, the market tends to divide into reconverted second-hand vessels which are rented out to oil companies (Chevron/Kuito, Exxon FPSO in West Africa) and the new FPSO looking for long-term employment with the oil companies. These latter units are considered as real fixed production units. In the first category, the market is organised around specialists such as SBM, Bluewater, Modec/Sofec, formerly suppliers of anchoring systems and who have finished by responding to the turnkey projects of the oil companies.

In the second category, the size of the projects and the sums involved together with the need of risk controls, calls for a direct involvement from the oil companies and the need of building contracts such as EPCI with the ad hoc grouping amongst the well established contractors such as Halliburton, Brown and Root, ABB, Technip, Bos, Aker, and Saipem.

The year 2001 risks being crucial in the area of new, big-sized FPSO/FSO as Exxon (Kizomba), Texaco (Agbami), TFE (Dalia), BP (US Gulf and Angola) and Chevron have either put out or will shortly be putting out to tender for the building and the installing of this type of units, mainly for West Africa and in particular Angola and Nigeria.

We question the ability of the large Asian yards to be able to meet the needs of the general contractors and fulfil the technical specifications of the oil companies. Apart from one European yard, the choice is restricted to the big Japanese or Korean yards. The latter are almost fully booked with the surge in newbuildings of all types of vessels and their schedules of delivery dates cannot easily be integrated into the timetables of the oil companies.

In an attempt to get around the problem of tight capacity, the project Elf Amenan in Nigeria envisages the initial construction of a FSO of 2.4 million barrels in the form of units built onshore which will then be assembled on a barge or in a drydock.
 

Cable laying vessels top
The year 2000 saw an abundance of newbuildings and refitting of cable vessels specialising in the laying and maintenance of fibre optics for the following reasons :
  • Firstly due to the gigantic leap in worldwide transmissions linked to the Internet.
  • A multitude of telecommunication operators following deregulation and consequently an equal number of companies owning underwater fibre optic cables.
  • The answers provided by the research and development departments of industrial manufacturers, principally Tyco and Alcatel, which allow the building and operating of numeric systems with ever bigger and more reliable transmitting capacities.
  • The tenders of established and start-up operators, linking the building of systems to the laying and complimentary work upstream and downstream, but also the maintenance work for periods of several years (up to 10) on a turnkey basis.
  • Operators insisting on highly reliable connections and a more careful and deeper burying of cables in the seabed 2-3 metres deep, and at depths up to 1,500 metres. The laying should be at a speed not exceeding one knot, which significantly increases the installation time and thus leads to an increase in the number of vessels to carry out such work.
  • Finally the ageing of the world cable laying fleet and the high freight levels due to the scarcity of vessels.

The thirty cable vessels for laying and maintenance under order or under conversion will enter into service for the most, part between mid-2001 and mid-2002. Amongst the units are those ordered by French companies Alda Marine (j/v Louis Dreyfus/ASN and FT Marine). Several other vessels have been ordered by the traditional cable operators such as Tycom, USA and Global Marine, but a considerable number have also been taken up as speculation by new owners to this market such as AP Moller, Danemark, Solstad, Norway and Dockwise. These units have found medium and long term employment with ASN, Tycom, and Global Crossing.

The need for large laying vessels should be covered by the delivery of ships currently being built, while future orders or refits of cable vessels should concern mainly the maintenance ships. The latter with a capacity of some 2,000 tons of cable will rely on dynamic positioning navigation and will see their speeds and length improved to enable them to repair any defective cables quickly.
 

Artist view of a cableship
to be delivered end 2001 by Hanjin - Owned by FT Marine

 

Overall the year 2001 appears to be propitious for the whole offshore industry. To conclude we should like to quote an extract from the book "Underwater cables" written in 1903 by Alfred Gay : "the underwater networks, 50 years after the creation of the first amongst them, now girds the entire globe. And the final word has not been said. To the existing links, each year further links are added."
 




Shipping and Shipbuilding Markets in 2000

I N D E X

›››File
FROM THE HOME PAGE
Fraudulent mechanism for tax evasion and tax evasion implemented by a paved logistics company
Pavia
Employees 138 irregular workers and VAT evasion and direct taxes for more than 1.6 million
Japan's ONE took delivery of its first 24,000-teu container ship
Kure
Another five ships of the same capacity built by Imabari Shipbuilding and Japan Marine United Corporation will follow.
Switzerland will subsidize the travelling motorway between Fribourg and Novara until 2028
Bern
Measures will be introduced to make the Swiss merchant naval flag more attractive
FEPORT discussed the effects on ports and terminalists of EU climate rules
Saintes Maries de la Mer
Highlights the need for European governments to transpose the minimum corporate tax directive to avoid distortions caused by tonnage tax
In 2022, combined European transport marked a slight decline.
Brussels
Historical record of national volumes, while international traffic has decreased by -0.5%
An engine failure of an oil tanker in the Suez Canal has not stopped traffic in the waterway.
Ismailia
The "Seavigour" transports crude from Russia to China
Renewed the national contract of the mowers and barcaioli
Rome
Average economic increase of 175 euros
Renewal of the concession to PSA Venice
Venice
It will have a duration of 25 years. A planned investment of 78.6 million euros and a traffic growth of up to 500mila teu. Concession to Veneta Cementi
For its own decarbonisation, shipping does not have to rely too much on e-fuel
For its own decarbonisation, shipping does not have to rely too much on e-fuel
Copenhagen
The Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping warns to take into account the future availability and prices of electro-fuels
EU Commission presents five legislative proposals on maritime safety and prevention of marine pollution caused by ships
Brussels
The aim is also to align European standards with international regulations
A quarter of Russian companies are in danger of disrupting production for the difficulty of receiving goods from abroad
Moscow
The first vice president of the Center for Strategic Research in Moscow
Truckers denounce the blocking of actions to improve the operation of trucks in the port of Spezia
The Spezia
Perhaps-they accuse the trade associations-it is the will to maintain the status quo
L'ultima lettura del Goods Trade Barometer della WTO segnala una ripresa che però potrebbe essere assai accidentata
The latest reading of the WTO's Goods Trade Barometer signals a recovery, but one that could be very bumpy
Geneva
Positive signals come from export sales orders
L'ultimo rapporto di AGCS evidenzia la notevole diminuzione della perdita totale di navi
The latest GATS report shows the significant decrease in the total loss of vessels
Johannesburg/London/Madrid/Munich/New York/Paris/Rotterdam/Singapore
In 2022 the number dropped by -36%. Sinking, fire/explosion and collision are the most frequent causes of accidents
Port of Livorno, interdicted four entrepreneurs and three companies
Livorno
Seized more than 8mila euros to a port authority official
Le Aziende informano
La Ant. Bellettieri & Co., presente da più di 140 anni nel Porto di Civitavecchia, opera nella logistica portuale e nell'intermodalità mare, ferro, gomma
L'elvetica Accelleron ha acquisito Officine Meccaniche Torino
Switzerland's Accelleron has acquired Officine Meccaniche Torino
Baden
The Rivoli-based company is a leading manufacturer of injection systems for marine engines
Grimaldi orders two more new Pure Car & Truck Carrier Ships from 9,000 ceu
Naples / Rome
Affirmed the reliance on Grimaldi Euromed of maritime territorial continuity on the Civitavecchia-Arbatax-Cagliari route
European Commission's OK to refinance the Italian Marebonus
Brussels
Aid programme worth EUR 125 million authorised, running until 2027
Assarmatori, good EU approval of Italian aid for road-sea intermodality
Rome
Messina; now the aim is to be able to use the resources as quickly as possible
I porti cinesi stabiliscono un nuovo record storico di traffico quadrimestrale delle merci
Chinese ports set new record for four-month cargo traffic
Beijing
New peak in containers alone
The handling of the freight traffic at Genoa airport was entrusted to the city's freight forwarders
Genoa
Giachero (Spediport) : It is essential to relaunch the cargo sector
At the end of the month APM Terminals will leave the management of the Itajaí terminal container
Itajaí
Superintendência do Porto will try to implement a new transitional solution pending the tender unopened by the federal government
GEODIS has bought Swiss Transport & Shipping helvetica
Levallois-Perret
In 2022, it recorded a turnover of 58 million Swiss francs
Conference in Genoa on the State of Implementation of the National Logistics Platform
Genoa
Organized by Federlogistics and Conftransporto-Confcommerce, it will be held next Monday
Livorno, air quality monitoring campaign in neighboring city areas to port
Livorno
The discovery campaign will last 240 days
Fincantieri agreement in Canada to propose "Vigilance" patrolman for the Royal Canadian Navy
Trieste
Two initiatives to commemorate Giuseppe Bono
On June 30 in Genoa, the second edition of the Youngster Shipping Summer Party will take place
Genoa
The event is promoted by Assagents
Fincantieri will build the third NFS submarine of the Italian Navy's Navy
Trieste
The first two batons will be delivered in 2027 and 2029
ABB plans a whale tail for the propulsion of small and medium-sized ships
ABB plans a whale tail for the propulsion of small and medium-sized ships
Zurich
The first prototype will be available in 2025
Final free route to the link between the port of Ancona and the State Road 16
Ancona
Aquaroli : It is a fundamental work for the development of the port, Ancona and the Marche
SAILING LIST
Visual Sailing List
Departure ports
Arrival ports by:
- alphabetical order
- country
- geographical areas
CMA CGM has completed the acquisition of La Méridionale
Marseille
Next order for two new LNG ships announced
Venice Boat Show inaugurated
Venice
Over 220 exhibitors. 300 boats presented, 240 of which in the water
MSC Crociere ha preso in consegna la nuova MSC Euribia
MSC Cruises took in delivery the new MSC Euribia
Saint-Nazaire
In the ship yard of Chantiers de l'Atlantique also took place the coin ceremony of "MSC World America"
Agreement between the AdSP of the Central Adriatic and the regional agency of the Marches for environmental protection
Yang Ming orders to HHI the construction of five portacontainer from 15.500 teu
Keelung
Commitment worth $927.9 million
Port of Genoa, procedural errors in paperwork reduced by 70%
Genoa
this is the result of what was experienced during a course organised by the Harbour Master's Office and Assagenti
Confitarma expresses satisfaction at EU approval for road-sea intermodality support, but denounces lack of resources
Rome
Mattioli: We hope that the new government will open a concrete discussion with the armament industry on this issue in view of the next Budget Law
KHI and DNV will define a method to calculate the CO2 emissions of the liquefied hydrogen supply chain
Tokyo
Specific memorandum of understanding signed
The Spanish FENADISMER will start a new class action against oil companies
Madrid
They are accused of taking advantage of the effects of the conflict in Udrain to apply a surcharge to fuels
Eni Agreement - RINA for the energy transition and decarbonization of naval transport
Rome/Genoa
Among the purposes, the development...
Chinese investment in the Suez Canal Economic Zone
Beijing
Production activities will be installed
In the first trimester of this year the traffic of the goods in the Croatian ports has grown of +14,9%
Zagreb
The increase is determined by the rise of the bulk volumes
Event in Genoa for the relaunch of the economy of the sea
Genoa
The sector - it has been emphasized - in recent decades has been dramatically underestimated in its potential
Assiterminal, Assologistica and Fise-Uniport Convention for Safety at Work
Genoa
It is by definition with the support of RINA
CMA CGM compra il quotidiano economico francese “La Tribune”
CMA CGM buys the French economic daily "La Tribune"
Marseille
The company is already active in publishing with the newspapers "La Provence" and "Corse Matin"
Next month Metrans will activate an intermodal link Rijeka-Budapest
Prague
The terminal of the Hungarian capital will be connected to the Serb terminal of Indija
Ok to a contribution of 2.2 million to the genoese harbour company CULMV
Genoa
Resolution approved by the Management Committee
ITA Airways, confirmed the agreement with Lufthansa
Rome
Uilt, important now to realize the objectives of development and growth of the industrial plan
German Schües is the new president of the BIMCO
Copenhagen
Subentra to Sabrina Chao who concluded his biennial term
PSA has acquired a minority share in the Vietnamese logistics company Sotrans
Singapore
It was ceded by Indo Trans Logistics Corporation
Inaugurated the second phase of the Vietnamese container terminal of Nam Dinh Vu (Haipong)
You have Phong
It has an annual capacity pairs to 1,2 million teu
In April the traffic of the goods in the port of Barcelona is dropped of -7.8%
Barcelona
The decrease has been determined by the decrease of the container, in particular by the ones in transit
TIL orders ZPMC nine cranes of quay for the TPO/TNMSC terminal of the port of Le Havre
Le Havre
They will be able to serve ships from 24,000 teu
GNV expands its support to the project for the protection of turtles and cetaceans in the Mediterranean
Genoa
The researchers, as well as on the Naples-Palermo route, are being housed on board the ships deployed on the Barcelona-Tangier and Valencia-Palma routes.
Positive the first quarter of MPC Container Ships
Oslo
The Norwegian company is concerned that supply growth in the segment of large container carriers could also have an impact on the fleets operated on intra-regional routes
PORTS
Italian Ports:
Ancona Genoa Ravenna
Augusta Gioia Tauro Salerno
Bari La Spezia Savona
Brindisi Leghorn Taranto
Cagliari Naples Trapani
Carrara Palermo Trieste
Civitavecchia Piombino Venice
Italian Interports: list World Ports: map
DATABASE
ShipownersShipbuilding and Shiprepairing Yards
ForwardersShip Suppliers
Shipping AgentsTruckers
MEETINGS
On May 25 in Genoa, a conference will be held on the programming, operation and management of transport networks
Genoa
It is organized by the International Institute of Communications and CIFI
On May 26 in Genoa, the first Mare Global Forum will take place
Genoa
It is organized by the Strategic Advisory Centre "Giuseppe Bono"
››› Meetings File
PRESS REVIEW
Budget proposes to cut tax on containers used in shipping
(The Daily Observer)
Exclusive: Malaysian tycoon weighs selling a stake in $2.7 bln port business -sources
(Reuters)
››› Press Review File
FORUM of Shipping
and Logistics
Relazione del presidente Daniele Rossi
Napoli, 30 settembre 2020
››› File
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