Port Bureau News October 2012
www.txgulf.org
A Post-Summer Look at Houston Imports/Exports Crude Oil, Machinery, Guar Gum and More
Marine Exchanges Your Marine Exchange of Texas The Marine Information Services of North America
Spotlight on David Halbert President—Houston Mooring Company
Chairman—Amato Linehandlers, Inc.
A Squall Moves in on the Houston Ship Channel
Port Bureau Staff Bill Diehl Jeannie Angeli David Cooley Al Cusick Cristina Gomez Janette Molina Christine Schlenker Patrick Seeba Josh Whitehead
Board of Directors *Dennis Hansell—Chairman *Steve Stewart—1st Vice Chair *Capt. Bill Hennessey—2nd Vice Chair *John Taylor—Sec./Treas. *Tom Marian—Immediate Past Chair *David Ellis *Charles H. Flournoy *Capt. John G. Peterlin III *Vinny Pilegge *Nolan Richardson *Capt. Richard Russell *Captain Robert Thompson *Len Waterworth *Nathan Wesely April Bailey Jim Black Robert Blades Ken Burnett Mike Drieu Robert Garcia Celeste Harris Jason Hayley Mehdi Hejazi Kevin Hickey Guy W. Hitt Charlie Jenkins Mike Mangan Brad Maxcey Jerry Nagel Bernt Netland Colin Scott Capt. Christos Sotirelis Tim Studdert *Denotes Executive Committee Members
Captain’s Corner
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This is my annual football column. Of course, if we make the playoffs, I reserve the right to continue the topic of football. The Texans are 4-0. I hope that when I sit down to write my next article in a month, they're still undefeated, but I know that they've got some tough competition ahead. In addition to managing the hype surrounding their Monday Night Football debut against the Jets, they face the Packers, the Ravens, and my hometown Buffalo Bills in the next few weeks. So why am I writing about football in a maritime publication? Well, I see what the Texans are doing and as a maritime community, I think we can learn a lesson from their preparation, defense and offense. Preparation: JJ Watt dominates the field. Not only does he have 7.5 sacks in four games, but he's recovered a pair of fumbles and batted 5 passes out of the air. How does a 3-4 defensive end get his hands on passes thrown when his job is to take care of going after the offensive line? He pays attention to everything that's going on and learns every detail about not only his team, but the opposition as well. After the season opener, JJ looked a little embarrassed when he admitted to a reporter that he'd learned the Dolphin's snap count from watching HBO's Hard Knocks... then used the information to sack Ryan Tannehill. While our pass rush might not be quite as ferocious, at the Port Bureau, we see it as our job to know what footballs are flying about our community so that we can let people know about issues that will impact their bottom line. One of the ways we do that is by taking note of member concerns and issues and getting out into the community. If you're reading this article and haven't attended a Port Bureau function in the last six months, I'll encourage you to put our commerce club on your schedule for next year. On the second Thursday of every month, we get together to hear from an expert in a field that has an impact on our businesses, and the commerce club is a great way to get your finger on the pulse of our Houston market. Defense: They say that Brian Cushing and JJ Watt have high motors: that they never give up on a play. I read that to mean that they are constantly motivated to get the sack. To me, motivation is that engine that drives us to do better, feel successful, and to help the organization be successful. At the Port Bureau, the opposing quarterback that we're pushing towards is dredging: we're keeping our motor running and trying to find new and innovative ways to apply pressure to make sure that our channel stays deep and wide. Offense: When Matt Schaub, Arian Foster, and Andre Johnson have the ball, they use their diverse skill sets to keep everyone guessing, but they all have one thing in common - they're all moving in the same direction. Coach Pat Studdert over at Buffalo Marine, this year's Bronze Anchor recipient from the Houston International Seafarer's Center talks about Houston as a place where people "Come together, and we all keep driving towards the same goal, we all keep pushing." We've got a great story here in Texas. As a state, we're moving 25% of the United States' maritime tonnage which in turn represents more than 98% of all foreign trade bringing cargo in and out of our country. In Houston, we're the busiest port in the country, and whether you're working with terminals, carriers, line handlers, bunker fuel providers, truck drivers, or logistics companies, we're all looking to do the same thing: create and sustain growth and expansion for our business. So what am I asking for? From JJ Watt, I'd love to see two sacks a game for the rest of the season. From the port community: tell me your concerns. I have a full time staff dedicated to looking for information that can make our port more efficient, address infrastructure issues, and pursue funding for our region as a whole. I've gotten good responses from our Capital Investment and Maintenance Survey that went out last month, but I'm always looking for more: let me know what you need as a community so that we can keep moving the chains as we work towards regional victories.
The Marine Information Services of North America
Maritime Information Services of North America (MISNA) MISNA is a non-profit coalition established in 1995 of thirteen marine exchange organizations representing all three US coasts and West Canada, all of which perform information services unique in their respective markets. MISNA organizations are not-for-profit companies dedicated to tracking and disseminating maritime activity information to be used by the Coast Guard, US Maritime Administration, Customs and Border Protection, and the commercial maritime industry “to ensure safe, secure, efficient and environmentally sound maritime operations.” With some maritime exchanges over 100 years old, each group is the expert in its regional maritime industry and represents a full spectrum of private and public maritime interests. Much like the Port Bureau in Houston, maritime community members serviced by regional maritime exchanges include local through federal government organizations, pilots, tug companies, ports, agencies, and ship owners and operators. Although no two maritime exchanges offer identical services, the following list provided by MISNA encompasses a general range of products and services:
Advance vessel schedule information, including ETAs and ETDs Actual arrival and departure data Traffic Analysis Historical vessel movement Information center and answering services Berth Scheduling Cargo Manifesting Port and terminal utilization studies Expert maritime analysis and assistance with regulatory compliance Hazmat, transportation, security, and a host of other training programs Secretarial and association management Turn of the Century Marine Exchanges
The BME/Baltimore Pilots’ Building
4 Baltimore Maritime Exchange With roots as far back as the 1790s, the Baltimore Maritime Exchange (BME) provided advanced ship arrival information using telescopes until 1960. Since then, the “Voice of Chesapeake Bay” has partnered with the State of Maryland and the Association of Maryland Pilots to provide ship-to-shore communications and real-time vessel traffic information up to several days before a vessel arrives. BME’s vessel activity database contains movement history since 1990, and the staff maintains hard copy records dating back to the late 1950s. BME currently provides 24/7 vessel reporting access on its website.
Chamber of Shipping of British Columbia The Chamber of Shipping of British Columbia was created in 1923 to represent international ship owners through their local offices. The COS is a not-forprofit industry association, and represents a variety of maritime businesses, including ship owners and operators, agencies, and service providers as well as publishes marine-related job opportunities as a courtesy for the shipping industry. The Chamber puts on annual Business of Shipping courses, and is an industry liaison with groups such as BIMCO which held its annual meeting in Vancouver in 2011. In addition, the COS negotiates on behalf of members to secure and ensure availability of facilities and services for vessels within the waters of British Colombia, studies problems related to the shipping industry, and proposes legislation and regulations that may affect shipping and related industries. Jacksonville Marine Transportation Exchange (JMTX) The Jacksonville Marine Transportation Exchange is Jacksonville’s maritime trade organization created to work for the success of its membership and coordinate the safe,
secure and environmentally responsible management of the marine transportation system within the port of Jacksonville. JMTX’s goal is to work in partnership with the port stakeholders to make Jacksonville the port of choice. Somewhat unique as a maritime association, JMTX has been established to provide a stable coordinating structure for port-wide planning, coordination and infrastructure recommendations. JMTX serves as an information clearinghouse for port critical information, provides a forum for stakeholder issues and serves as a stakeholder advocate to local, regional and national agencies. JMTX has been accepted by the U. S. Coast Guard as the coordinating organization for the port’s official Port Security Committee, and the Harbor Safety Committee. Since 9/11, JMTX has played a major role in coordinating security issues including assessments, intelligence sharing and compliance with security requirements. In addition, JMTX has been designated by the Captain of the Port to serve as the Fiduciary Agent (FA) of the PSGP for the port of Jacksonville for the FY07Sup, FY08, FY09, FY10 and FY11 awards. Marine Exchange of Alaska (MXAK) Established in 2000, MXAK in Juneau built and operates over 90 AIS sites in Alaska that extend from the Canadian border, 2,000 miles west to the remote Aleutian Islands and north above the Arctic Circle. In addition to tracking vessels throughout Alaska, the system also picks up vessels in neighboring Canadian and Russian waters. “We have a team of adventurous men who think nothing of packing a sleeping bag, bear protection and tools and heading off to remote areas of Alaska on a boat, helicopter or float plane to build an AIS site.” notes CAPT Ed Page, USCG (Ret.), Executive Director of MXAK. “We’ve installed sites at abandoned lighthouses, fish hatcheries, tug offices, MXAK Personnel en route to an AIS Site
schools, mountain tops, fish processing facilities and pilot stations throughout the Greatland.” MXAK staff members log more than 3,000 miles a year on their 32 ft. landing craft the CLEAT, and over 250,000 miles on via air servicing sites that feed vessel tracking information to the Coast Guard, local, state, and federal agencies as well as the maritime community. MXAK combines satellite transponder position reports and AIS data on vessels to aid safe, secure, efficient and environmentally sound maritime operations and maintains a 7x24 operations center staff respond to various alarms generated by the system. The applications of the tracking system are extensive, including passing on automated alerts to the FAA when high mast vessels transit an airport approach during low visibilRemote AIS Site Maintained by MXAK ity conditions leading to FAA directing inbound aircraft to stand off until the area is clear of large vessels. The vessel tracking system has also aided the Coast Guard’s search and rescue missions on numerous occasions as well as the response to other maritime emergencies and daily it aids the efficiency of maritime operations. In addition to vessel tracking, others of the 16 person staff travel throughout Alaska aiding ports, facilities and vessels comply with federal and state environmental, security and safety regulations. MXAK also produces “Print on Demand” nautical charts and stocks navigational publications to aid safe maritime operations and maintains a comprehensive database of emergency contacts, port and vessel information, careers, and regulatory information. MXAK accomplishments have been recognized by presentation of the Coast Guard’s Meritorious Public Service Award and most recently the Valdez Marine Safety Committee's 2012 Marine Safety Recognition Award for its vessel tracking system, assistance to the marine industry in complying with safety and security regulations, facilitating the issuance of TWIC cards to the Alaska Marine Community and the development of vessel and facility security plans. Marine Exchange of Puget Sound Marine Exchange of Puget Sound Vessel Tracks The Marine Exchange of Puget Sound (Exchange) was founded in 1980 to provide comprehensive communications and information services to its membership 24 hours a day, seven days a week. Today these services are provided using state-of-the-art technologies. The Exchange gathers information from numerous sources about projected vessel arrivals. It then monitors each vessel’s movement activity through actual arrival, shifts and, ultimately, departure. With tracking capabilities made possible by shore-based collection of shipboard Automatic Identification System (AIS) data, the Exchange provides valuable information and services to its members to aid in their safe, secure and efficient operations. Members are entitled to a full range of subscription services, include 24 hour answering services and web-based AIS tracking with support from a 24/7 watch, as well as various real-time and historical reports. The Exchange provides administrative support services, which include such services as invoicing and accounting and meeting records, for various maritime related organizations, such as Washington State Maritime Cooperative (WSMC), Puget Sound Harbor Safety Committee (PSHSC), Seattle Chapter of the Propeller Club, Puget Sound Marine Firefighting Commission (PSMFC) to name a few. Marine Exchange of the San Francisco Bay Region The Marine Exchange of the San Francisco Bay Region is the descendant of many entrepreneurs and merchant exchanges that date back to 1849 when incoming vessel information was relayed by semaphore, a windmill-looking structure with movable arms built on Telegraph Hill. As an organization built on technology, the Exchange was responsible for the first telegraph system on the West Coast and the city’s first telephone operation. The modern Marine Exchange focuses on collecting and disseminating shipping information, facilitating communication and discussion in the community, developing improvements, providing vessel ETA/ETDs, position reporting, movement logs, and shipping notifications statistics.
The San Francisco Marine Exchange’s Octagon Building in 1927
The scope of the activities in which the Marine Exchange is involved is as broad as that of the shipping industry itself and ranges from forecasting, tracking, statistical analysis, operational support and communications to industry forums and collaborative programs. "The Marine Exchange has had a long and a close association with the Coast Guard. At one time, the Marine Exchange’s office was in the Ferry Building, but our operation center was at the end of Pier 45, adjacent to the Coast Guard’s Vessel Tracking Station. In fact, the first vessel tracking system was created by the Marine Exchange in conjunction with the Coast Guard at Pier 45. In addition, the Coast Guard’s Harbor Safety Committee was a product of the Marine Exchange and has served as a model for the state committee” notes Captain Lynn Korwatch, Executive Director of the Exchange. Marine Exchange of Southern California (MESC) VTS Watchstanders at the MESC Founded in 1923, the Marine Exchange of Southern California started serving Los Angeles, Long Beach, El Segundo, San Diego and Port Hueneme with telescopes, signal flags and flashing signal lights. Since then, in partnership with the United States Coast Guard and industry stakeholders, The Marine Exchange/VTS of Southern CA the Marine Exchange has developed one of the most unique public-private partnerships in the nation in the VTS-LA/LB. In March, 1994 with the help of grants from the Ports of LA/LB, a low-interest loan from the State of California, and state-of-the-art commercial radar and electronic processing systems, the Coast Guard, State of California, local pilot organizations and Marine Exchange formed a Vessel Traffic Information Service. The system, operating much like government-only VTS stations across the nation manages vessel traffic in and out of the LA/LB port complex and shares radio, AIS, transponder and other information with navigators, VTS operators, industry and coastal authorities. The Marine Exchange of Southern California serves the ports of Los Angeles, Long Beach, El Segundo, San Diego and Port Hueneme and maintains a computerized database system of statistics and information on ships calling each port. Members are provided with various data and reports on schedules, arrival times, and locations. Maritime Association of Port of New York and New Jersey (MAPONY) The Maritime Association has been presenting the commercial operations and maritime information for NY/NJ to the public since 1873. Their current operations focus on advocacy for the industrial maritime community, promoting safety of navigation, security of maritime assets, sustainability of marine environment and the economic competitiveness of the Port of NY/NJ. Though the two ports of New York/New Jersey are separated by a river, the MAPONY covers the whole port region with over 500 corporate and individual members. MAPONY holds the distinction of managing the oldest harbor operations and security group in the nation— committees that started in 1914 at the request of the federal government immediately following the outbreak of WWI. “That’s been a constantly changing and developing mission” notes MAPONY executive director Ed Kelly, “Let’s be honest, security has changed a lot in the last few decades and nowhere is that more evident than here in New York. Our offices are literal baseball throw from the site of the World Trade Center and with 5,000 annual vessel arrivals and a VTS-estimated 400,000 commercial transits per year, this is a busy port with a myriad of challenges, threats and opportunities.” The MAPONY also holds an annual maritime hall of fame celebration at the United Nations Headquarters, and facilitates numerous subsidiary committees including harbor operations, ocean carriers, tug and barge movements, area security and others.
Your Marine Exchange of Texas: The Greater Houston Port Bureau
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The Greater Houston Port Bureau is your Marine Exchange of Texas and a member-driven non-profit dedicated to providing vessel movement information, promoting the maritime community, and offering members premier networking and advertising opportunities to drive business. In its capacity as the Texas Maritime Exchange, the Port Bureau maintains detailed records for vessel movement for Texas ports from Beaumont to Brownsville. Using its ten-year database of Texas vessel movements, staff can provide data analysis services to members on request. All members receive the Texas Ports Monthly Vessel Statistical Report, which includes: All-Ports Movement Summary; Houston Ship Channel Tug/Tow Movements; Houston Vessel Type Summary; and Houston, Galveston, Texas City, and Corpus Christi Dock Arrival Summaries and Agent Utilization Summaries. The Marine Exchange also produces reports available to its membership upon request. Daily movement reports detail arrivals and departures for the Port of Houston and the ports of Galveston, Freeport, Texas City, Sabine, Port Comfort/ Lavaca, Corpus Christi, and Brownsville. The Houston & Texas Ports ETA Reports let members know the vessels coming into the ports of Texas up to two weeks before they arrive. Additionally, the Port Bureau’s Watchdog service can help customers locate a specific vessel and then send notification to the customer as soon as the vessel reaches the port of choice. The Port Bureau’s Marine Exchange also offers exclusive licensing to the HarborLights Vessel Traffic Management System. HarborLights is a direct window into the Houston and Galveston-Texas City Pilot dispatch offices, so you can see up-to-the moment what is being planned along the Houston Ship Channel. This service allows agencies and terminals to manage their movements and tertiary service providers to be ultra-responsive to customers with minute-by-minute coverage of the channel that’s verified by multiple sources—not just traditional AIS. As with the other marine exchanges, the Port Bureau provides many services other than vessel traffic movement information. The Port Bureau supports the maritime community by representing its interests and providing educational presentations to local, state, and federal organizations, including Texas and U.S. Congresses. Partnering with organizations such as the Port of Houston Authority, the Port Bureau helps support domestic and foreign trade development. The Port Bureau administrates three maritime organizations, the Houston Ship Channel Security District, Greater Houston Coffee Association, and Houston Customhouse Brokers & Freight Forwarders Association. To support networking and business development within the maritime community, the Port Bureau offers its members a directory listing, company recognition on its website, members-only mailings and updates, and monthly publication of the Port Bureau News that you are currently reading. Members also have the opportunity to participate at the monthly Commerce Club meetings, the Annual Maritime Dinner, the Captain’s Cup Golf Tournament, and advertising in the Port Bureau News.
“We have a very large contingent of ATBs, fuel lighters—80% of the heating oil for all of New England goes through our port, so in addition to consumer goods for the massive population we’ve got, we also move a tremendous amount of liquid bulk—so much that I’d say we’re the largest barge port in the nation.” Maritime Exchange for the Delaware River and Bay Since 1875, the Exchange (MEDRB) has been tracking the movements of vessels on the Delaware River and disseminating that information to its members to facilitate the movements of vessels and cargoes. The Exchange has expanded this role and today serves as the electronic communications hub for the Delaware River and Bay, providing a port information network of unparalleled scope in the maritime industry. In addition to vessel tracking and ship reporting services, the Maritime ExThe Original Lookchange provides 24/7 access to CBP’s Automated Commercial Environment through its out Point for the TRACS program, as well as an automated electronic tool to submit advanced vessel arriMEDRB val, departure and crew list information to the Coast Guard to meet federal reporting requirements for notices of arrival. With more than 280 members, the Maritime Exchange advocates for the maritime industry along The Modern Communications the Delaware River and acts as the voice for the port’s public policy stances. With standing committees Tower for such as its Maritime Operations Committee, Credentialing Workgroup, Free Trade In Steel Coalition, Cold MEDRB Storage Facility Task Force, Non-federal Dredge Committee and Marine On-Line workgroups, Maritime Exchange members meet directly with government officials, business partners and competitors to discuss port issues. Merchants Exchange of Portland, Oregon The 133-year old Merchants Exchange Portland was founded in Boss Shenck’s Saloon on the Portland waterfront as an early gathering place to post news of ship arrivals and discuss maritime trade. Since then, the Merchant’s Exchange has grown and expanded to keep pace with the ever-changing nature of trade and technology. The Exchange operates 24/7, keeping watch over the lower Columbia and Willamette Rivers’ maritime and harbor communities. The Exchange also has a long Networking in Downtown Portland in the history of involvement in the grain inlate 1800’s dustry. In 1914, the Exchange established the region’s first official market for trading wheat and created the Portland Grain Exchange which became the Exchange’s first client association. Since that time, the Exchange has worked to meet the services and needs of its members and expanded its services to support the client associations that enter into a Merchants Exchange Association Service Agreement such as the regional Maritime Fire & Safety Association, Clean Rivers Cooperative, the Columbia Rivers Steamship Operators Association, and the Pacific Northwest Grain & Feed Association, among many others.
Maritime Association for the Port of New York/New Jersey—ctd.
The Merchant’s Exchange communications center maintains round-the-clock operations filing required vessel 10 movement documents with the NVMC and CBP, notifying industry of ship movements with multiple reporting services, and monitoring communication with vessels transiting the lower Columbia River. In addition to its administrative services, the Exchange also acts as the Fiduciary Agent for the Columbia Willamette Snake River System Port Security Grant Program. The Louisiana Maritime Association’s (LaMA) Mississippi River Marine Exchange (MRME) As the MRME parent company, the Louisiana Maritime Association (LAMA) represents over 60 Ship Agent Companies and associated maritime interests on and along the Mississippi River. LAMA describes itself as “a force of commerce and innovation on the Mississippi River since 1912”. LAMA provides key industry liaison with Customs and Border Protection, US Coast Guard, the United States Department of Agriculture, the Corps of Engineers, the Transportation Security Administration, the National Oceanic and Atmospheric Administration and the Department of Homeland Security. LAMA's Big River Coalition represents Mississippi River maritime interests regarding federal navigation channel maintenance as well as channel improvement initiatives. The Mississippi River Marine Exchange (MRME) provides LAMA and BRC members with a wide range of services and notifications including USCG MSIB's, USCBP Southern Currents, LAMA Informational Circulars, USACE Navigation Bulletins, daily river status reports of draft conditions and related legislative and funding issues. Daily Vessel Location, Anchorage, Cross-In/Cross-Out Reports and a comprehensive AIS service provides MRME users a clear picture of maritime operations on the Lower Mississippi River. New Orleans Board of Trade (NOBOT) The New Orleans Board of Trade, Ltd has a history of service dating back to 1880 when it was founded to as a non-profit membership organization comprised of key leaders in the business community. Through its storied history, the NOBOT was actively involved with the creation of the Board of Commissioners of the Port of New Orleans as one of the four original nominating organizations, and still today acts as the secretariat for the Orleans Parish Nominating Organizations. Offering services to members as a non-profit membership, NOBOT is also key in solving regional disputes through the Society of Maritime Arbitrators. The New Orleans Board of Trade operates a Marine Exchange for vessels transiting the Mississippi River, with vessel arrival and departure information since 1995 available and records on all ship arrivals dating back to 1961. NOBOT provides access to the ShipTracks AIS service to its members and operates a state-of-the-art answering service. Virginia Maritime Association (VMA) Organized in 1920, the Virginia Maritime Association focuses on promoting, protecting and encouraging the interests of the shipping industry throughout the Port of Virginia. The Association’s Marine Exchange offers its members daily updates on vessel traffic information, information on the maritime community through e-bulletins, and a monthly bulletin. VMA also sponsors committees to discuss VMA Members during Fire port issues including freight forwarding, fire protection and hazardous cargo, inland transportation, Protection Training environmental awareness and harbor dredging among many others. In addition, VMA is an aggressive advocate for the Port of Virginia as well as its over 500 member companies and offers member-only discounts to IT/Network services, staffing, entertainment, lodging, insurance and more. Finally, VMA offers networking activities including events such as an annual banquet, trade symposium, breakfast briefings and other educational opportunities.—P. Seeba, GHPB
New Forever Stamp Highlights the Brownwater Industry in Texas As part of it’s new Earthscapes series, the United States Post Office is issuing a Forever stamp with an image of the busiest port in the nation. According to USPS: the stamp showcases “A pair of towboats “wrangling” commercial barges in the Old River barge fleeting area near the Houston Ship Channel in Texas. The photograph of the Apollo (top) and Taurus (bottom, formerly named Marie Cenac) was taken by Jim Wark of Pueblo, CO.” The series also features such landmarks as Grand Prismatic Spring in Yellowstone National Park, Mount St. Helens, and Alaska’s Great Bear Glacier.
Burger Smog What Creates More Particulate Pollutants: Hamburgers or Trucks? A study from University of California – Riverside shows that charbroiling a single hamburger may be responsible for more particulate pollutants than the diesel 18-wheeler truck that delivered the meat to the restaurant. Bill Welch, with the Center for Environmental Research & Technology, recently led a study on commercial cooking emissions controls, funded by the South Coast Air Quality Management District (SCAQMD) and the San Joaquin Valley Air Pollution Control District. Using statistics from SCAQMD’s 2007 Air Quality Management Plan, which determined that commercial cooking is second-largest source of particulate matter in California’s South Coast Air Basin, Welch found that charbroiling one hamburger releases as much particulate matter as a diesel truck driving 143 miles on the freeway. In a recent interview, Welch stated that, “we estimate that the hamburger’s contribution of particulate matter to ambient atmosphere is twice that of all the on-road diesel vehicles…It’s really a testament to the advances in technology in diesel engines.” Allen Schaeffer, the executive director of the Diesel Technology Forum, fully agrees that clean diesel technology is driving air quality improvements. "Because of the investments in new technology, it now takes 60 of today's technology trucks to emit the same level of PM [particulate matter] emissions as one truck built in 1988." Many emissions-emitting industries like heavy trucking have made significant technological advances reducing emissions, often
to keep ahead of strict regulations. How- 12 ever, the commercial cooking industry has very little emissions controls and just as little incentive to improve, which is why Welch is researching devices to trap particulate emissions. Not all cooking methods release clouds of pollutants – griddles cook meat at temperatures too low to evaporate dripping fat into smoke, and conveyor broilers can be controlled with catalytic convertors much like vehicles. The main emissions perpetrators are the Burger King-style openunderfire broilers, flame-broiling burgers at temperatures up to 900 degrees, and releasing 33 pounds of particulate matter per 1,000 pounds of meat. Welch’s team is testing a device that would filter cooking exhaust by trapping evaporated and condensed grease in water. If the tests are successful, the devices could soon be installed in vent hoods and exhaust pipes at local burger joints. The testing process involves cooking hundreds of pounds of burgers, which are then donated to hungry college students and food kitchens. The Diesel Technology Forum hopes this odd comparison between burgers and truck exhaust will help consumers realize that the environmental impact of trucking is continually decreasing as technology improves. “Generally, clean diesels are matched up against natural gas, hybrids or electric vehicles for emissions or fuel efficiency tests. This is the first time we've gone head-to-head against fast food," Schaeffer said.—C. Schlenker, GHPB
A Post-Summer Look at Houston Import/Exports Crude Oil, Machinery, and Guar Gum Powder Seaborne Import and Export Value From January to July of this year, the Port of Houston saw a 9.71% increase in total seaborne trade value over the same time frame last year, according to the most recent data available from the US Census Bureau. Total trade value is the value of imports plus the value of exports. This is stronger growth than the US ports as a whole, with a 5.7% increase in total trade value, and the Houston-Galveston Customs District (HGCD) with a 7.28% increase. The maritime ports in the HGCD include Corpus Christi, Freeport, Galveston, Houston, Port Lavaca, and Texas City. For Houston, the increase in total seaborne trade value was largely driven by a 12.70% increase in import value. Export value increased by 6.97% which, while still ahead of the overall US increase of 5.21%, wasn’t strong enough to prevent the value of imports surpassing the value of exports in July for only the fourth month since January 2009. Last year, import value led export value for the months of June and July. The surge in import value has also taken a large bite out of Houston’s trade surplus – dropping surplus by more than half from $4.0 billion to $1.7 billion year-to-date. The Customs District and US ports overall are operating in a trade deficit, with HGCD coming $382 million closer to parity and the US increasing its deficit by $22 billion. Houston Exports Houston exports were led by the usual suspects, oil (not crude) at $19.15 billion year-to-date, up $3.1 billion from 2011 YTD, and parts for heavy machinery at $7.8 billion YTD with a more modest increase of $359 thousand year-to-date. The biggest losers this year are cereals and cotton, down 61% and 83% respectively, suffering not only from the Midwest drought that has Mississippi River barge traffic barely crawling, but also in comparison to high year-to-date values in 2011.
Fracking Jargon Shear-thinning gel: Gel that becomes less viscose as more shear-stress is applied. A good example? Ketchup, which remains in a mound when sitting, but is easily squeezed out of a tilted bottle. Propants: Sandy materials used to maintain fractures Gelling agents: Used to suspend the propants in water, and aid in keeping fractures open Surfactants: Materials that migrate to the surface of the fracking fluid, used to reduce surface friction. Largest non-water chemical in fracking fluid by volume, and also the least environmentally friendly. Biocides: Used to kill naturally-occurring bacteria that can cause serious equipment or formation damage
Houston Imports Driven by Fracking
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Crude oil continues to lead Houston imports by value at $21.6 billion, nearly a billion dollar increase from last year. Articles of iron or steel (namely pipes, tubes, and assorted fittings, primarily for oil and gas drilling) rose to $5.4 billion, an impressive $1.5 billion increase over 2011. But the single largest increase in import value for this year, from $295 thousand to $2.2 billion, has been from a little bean – the guar bean, mostly grown in the arid regions of India, and until recently, used primarily for cow food. Guar gum, made by grinding the husked legume, has excellent viscosity properties that have made it the most sought after ingredient in fracking fluid. Consequently, while the weight of guar imports has increased by 50% year-to-date, the cost per kilogram has increased sixfold. [FIG 2] Guar Gum in Fracking Fluid Guar gum powder is used as a thickener, stabilizer, and emulsifier in a wide variety of products ranging from cosmetics and ice cream, to paper and explosives. As a type of galactomannan, a long-chain carbohydrate made of two types of sugars, guar gum forms a viscose shear-thinning gel when mixed with water. Fracking fluid is composed almost entirely of water, with about 1% of the total fluid coming from propants, gelling agents, surfactants, and a few other ingredients (see the side bar for definitions of the jargon). Guar gum, more soluble in low temperatures than most other galactomannans, makes an ideal gelling agent for suspending propants in the fracking fluid, helping to keep fracking fissures from closing.
Rising Demand and Skyrocketing Price Should Slow Many Indian farmers are calling guar beans their “black gold,” the hardy crop that is lifting entire villages out of poverty. But stateside, oilfield services companies are feeling the financial hit from the recent exponential price increase. As the natural substitutes are not as effective and a suitable synthetic has yet to reach the market, demand for guar has been price inelastic. Only a few years ago, the cost of guar gum was an estimated 5% of fracking cost – now it can be as much as 30%, according to Halliburton. Increased demand and speculation of a supply shortage from lower than expected Indian rainfall are to blame for the price spike. In fact, India’s market regulator Forward Markets Commission banned futures trading on guar beans in March to halt price increases based on speculation. Several oil services companies, including Halliburton and Baker Hughes, have hedged their bets by stockpiling guar inventories to prevent a supply disruption. At the same time, both companies have released statements earnings have taken a hit from higher than expected guar costs adding to a deficit begun by falling shale gas prices which ate into their margins. Following Halliburton’s announcement that it would stop stockpiling in June, traders found more guar on the market and prices fell by almost 50%. In the next month or so, we expect to see the falling prices reflected in market reaction, however, analysts at the energy investment bank Dahlman Rose have continued to be bearish about Halliburton’s prospects, because of “the sluggish environment in North American rig activity, which is likely to persist. Pricing in the US frac is expected to continue to weaken, and relief on guar prices will not come until 2Q13…price relief will not occur in the first quarter to any meaningful extent.” - C. Schlenker, GHPB
The Strait of Hormuz—Chokepoint for 20% of the World’s Oil A Brief Outlook from the Energy Information Agency International crude oil and liquefied fuels movements depend on reliable transport through key chokepoints. In 2011, total world crude oil and liquefied fuels consumption amounted to approximately 88 million barrels per day (bbl/d), and more than one-half was moved by tankers on fixed maritime routes. Chokepoints are narrow channels along widely used global sea routes, some so narrow that restrictions are placed on the size of the vessel that can navigate through them. The map shows chokepoints that are critical areas for global energy security because of the high volume of oil that moves through waterways. The Strait of Hormuz, located between Oman and Iran, is the world's most important oil chokepoint due to its daily oil flow of about 17 million bbl/d in 2011, roughly 35% of all seaborne traded oil and almost 20% of oil traded worldwide. More than 85% of these crude oil exports went to Asian markets, with Japan, India, South Korea, and China representing the largest destinations. The blockage of the Strait of Hormuz, even temporarily, could lead to substantial increases in total energy costs. Among the major oil exporters that ship oil through the Persian Gulf, only Iraq, Saudi Arabia, and the United Arab Emirates (UAE) presently have pipelines to bypass Hormuz, and only the latter two countries currently have unutilized pipeline capacity on these pipelines. At the start of 2012, the total unused pipeline capacity from Saudi Arabia and the UAE combined was approximately 1 million bbl/d. The amount available could potentially increase to 4.3 million bbl/d by the end of this year, as both countries have recently completed steps to increase their capacity to bypass the Strait (see table). Notes: All estimates are as of August 17, 2012 and expressed in million barrels per day (bbl/d). 1. Though the Kirkuk-Ceyhan Pipeline has a nameplate capacity of 1.6 million bbl/d, its effective capacity is 0.4 million bbl/d because it cannot move additional oil until the Strategic Pipeline can be repaired to bring in additional oil from the south of Iraq. 2. "Unused Capacity" is pipeline capacity not currently utilized and can be readily available. 3. All estimates for 2012 are rates around the mid-year point; not the forecast average for 2012. 4. Throughput rates for 2012 are assumed to be the same as average throughput rates in 2011.
Iraq cannot send additional volumes through its Kirkuk-Ceyhan (Iraq-Turkey) Pipeline to bypass the Strait of Hormuz unless it receives more oil from southern Iraq via the Strategic Pipeline linking northern and southern Iraq, but portions of the Strategic Pipeline are currently inoperable.
Saudi Arabia recently increased its additional unused pipeline capacity to 2.8 million bbl/d when it converted one of the two pipelines connected to the Petroline system back to transporting crude oil.
The UAE recently opened a 1.5 million bbl/d Abu Dhabi Crude Oil Pipeline, which runs from Habshan, a collection point for Abu Dhabi's onshore oil fields, to the port of Fujairah on the Gulf of Oman, allowing crude oil shipments to circumvent Hormuz.
Port Watch Tom Marian—Buffalo Marine Service
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What Will Be the Fruits of Fall?
Two consecutive months of gains for Texas ports appears to reflect the nascent consumer optimism that is being heralded by economists as evidence that the economy is gaining traction. This was the first back-to-back gain for 2012 as over 4% more vessel called upon Texas ports. While it is still early, August’s numbers in combination with September’s anticipated solid performance may bode well for the holiday-season import surge – an import influx that typically begins in the tail end of September. Yet, it is of note, that when one peers more closely at the numbers, the Port of Houston was flat and the Houston Ship Channel brownwater (i.e., inland tows) throughput was off by over 1.5%. Granted, the latter was most likely a direct result of Hurricane Isaac’s impact on the Gulf Intracoastal Waterway from Alabama to Louisiana since the year-to-date movements are nearly 5% higher than last year. Overall, 2012’s cumulative bluewater arrivals for Texas Ports is slightly above that of 2011. Sabine and Corpus Christi led the “gainers” with a 9% jump in vessel arrivals. Sabine is still off by nearly 2% for the year but Corpus is up by over 2%. The ports of Freeport and Texas City were close behind with monthly arrival increases of 8% and 7.5% respectively. On a year-to-date basis, Freeport is the “loss leader” with 14% fewer arrivals whereas Texas City is holding its own with a 1.5% increase. The port of Galveston posted its best month to date with 75 vessel arrivals – a 4% monthly climb. Nonetheless, this number would have been an average number in 2011 as the port is off by 13%. Finally, the center-of-gravity Port of Houston hit the 700 arrival mark in August reflecting a gain of 2 additional vessel arrivals for the month and a 2.2% improvement over last year’s running total. Within the Port of Houston there was an interesting mix of ups and downs over the last month. Bulk carriers and seagoing tugs and barges dominated the top spots with monthly increases of 21.5% and 19.5%. That being said, bulk arrivals remain down by 5% for the year – a stark contrast from the ocean going tows which are up over 16% for the year. Chemical tankers and car carriers put up more modest numbers for August registering respective rises of 5% and 2%. While containers are down nearly 1% for the year, chemical tanker arrivals remain north of 92% as compared to last year. Car carrier arrivals for the year are in second place with a 38% year-to-date gain as it tied last month’s high number of 14. The three vessel categories that experienced the largest monthly drops were LPG (17%), General Cargo (6%) and tankers (3.5%). Nevertheless, of the 3 categories, only tankers are down for the year by nearly 20% as LPG and General Cargo are up 13.6% and over 9% respectively. Not unexpectedly, as reflected in the composition of the various vessels plying the region, energy continues to dominate the maritime picture throughout the Texas Gulf. Fortunately, these ports have not been directly impacted by the extreme low water on the upper Mississippi River due to a drought that saw little relief from Isaac’s deluge. The dilemma is that while energy provides fuel for many a commercial venture, the harvests from the nation’s bread basket fuel a sizeable portion of the export market. Unless much more rain falls, those harvests are looking rather bleak and that certainly does not make for a bountiful harvest. As to what that yields as fall unfolds remains to be seen but it will certainly set the stage for the remainder of the year.
Spotlight on David Halbert President—Houston Mooring Company “Well it’s a funny story actually, I kind of fell into the maritime business, but I really enjoy it and have to say, it’s been a great place to make a career.” David Halbert may have been an elementary student looking at the sky and dreaming of becoming an airline pilot, but it’s a different type of craft that’s shaped his adult life. As President of Houston Mooring Company, and Chairman of Amato Linehandlers, David and his longshoremen are responsible for ensuring that ships coming to Houston are tied up at the docks so that they can unload their precious cargo and bring trade to the region. Born in Waco Texas, when he was young, David moved to Pasadena with his parents. His father and uncle Clint were the two “H’s” in H&H Music Company while David made his way through Houston public schools, graduating from Lamar in 1961. Since his elementary days in Pasadena, David wanted to be a pilot, so when he started studying finance at Texas A&M in College Station, he was also in the Air Force program training to be a fighter jock. “I was good at it too—you know, some things you don’t know if you’ll be any good until you try, and I was good at flying. But then, my entry-to-active-duty physical came back and told me I had an eye condition and I couldn’t fly. I applied for waivers, but ended up hearing—from the draft board of all people—that they didn’t go through. That was rough, but I guess it’s turned out all right in the end.” At the same time that David was leaving school, his father-in-law was looking to start getting out of the maritime industry, so David figured it would be a good place to get started. Working dispatch at Houston Mooring, he learned the business on the fly putting in long hours and plenty of sweat as he got up to speed on the intricacies of the Houston Ship Channel. David also attended the University of Houston law school and is a licensed Texas attorney. “I did quit for a few months back in ‘67 when I did my initial stint in the National Guard though.” Joining the Army National Guard, David spent six months in training including time at Fort Polk, LA and jump school at Fort Benning, GA. “Jumped out of plenty of planes. I don’t do that so much anymore though. I do see President Bush up there in his 80’s, but I think I’ve gotten all that out of my system. Used to ride a motorcycle to work, but I’m pretty well through with that too.” For six years, David served in the National Guard—jumping out of airplanes in between time back in Houston learning the ropes at Houston Mooring. Over the next 40 years, David’s seen the industry change “Well, when I first started doing this, the longshoreman were really, I would say, truly an adversary, and I’ve seen that turn around to where we pretty much work hand-in-glove with industry.” Asked about current labor relations nationwide, David stated his support for continued cooperation, “I’m sorry to see what’s going on right now up in NY, but we’ll reserve judgment until we get a contract.” Continuing, “What you have to understand about the way things have improved is that some of the union was just flat-out crooked when we started here, and negotiations were…shady. You couldn’t trust anybody to do anything they said they were gonna’ do, a contract was not a contract. You’d sign a contract then argue over every little detail all year until it was time to sign another contract. Well those people and those days came and went. We’ve had good union leadership for the last 20-30 years. It’s a new breed of cat working for us now—smarter, more educated, more sophisticated. They see that we’re all in this together instead of fighting each other tooth and nail. In my view, things’ve gotten much much better over the years. I keep reading about the situation in the East Coast and it sounds like things are cleaning up there too, slowly but surely. The East Coast has changed for the better, but it’s even-better down here—the South Atlantic & Gulf Coast District has done very well working in the community.” After his first wife of 38 years passed away in 2003, David met a widow and remarried in 2007 to Kellie Halbert, a regional Vice President of ING Financial Management. David’s two children Jill Taylor and Michael Halbert live in the Houston area, and in his spare time, David is an avid fan of Texas A&M Football. “I manage to make it up there a couple of times a year—the move to the SEC has been good for excitement around campus, so I think I’m in favor of seeing that energy up on the field.” Houston Mooring Company is the original mooring company in the Port of Houston and has faithfully served customers since the 1920’s. The only mooring company in town until the mid-1960’s, Houston Mooring Company operates throughout the entire port, docking and undocking vessels from the Turning Basin to Bayport. Amato Linehandlers services Texas City.
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(top-left:) Tim Close, Horizon Shipping talks to Pete and Kelley Simons, Port of Galveston (top-middle:) Sarah Agnich, Lori Shenker, Frost Bank and Krish Shukla, Richardson Stevedoring & Logistics (topright:) A-SAC Michael Anderson, FBI, GHPB President Bill Diehl, and Tim Close listen to PHA Commissioner Elise Lanier (midmiddle:) Charles Flournoy, John L Wortham & Son, and Mark Kuebler, Bay Houston Towing Company (midright:) Cecil Gray, Pasadena HISD and Ed Foster, Mundy Companies (lower-left) ASAC Michael Anderson, FBI addresses the Commerce Club (lower-middle:) Art Flanagan, HUB International Rigg, and Charlie Jenkins, PHA (lower-right:) The Commerce Club meets at Brady’s Landing.
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