August 2014 Marine Log

ANNUAL GREEN TECHNOLOGIES SUPPLEMENT

ARINE OG M L Reporting on Marine Business & Technology since 1878

www.marinelog.com

AUGUST 2014

CAPTAIN OF INDUSTRY TOTE President & CEO Anthony Chiarello

MCALLISTER TOWING Resilient spirit HARVEY GULF Going hybrid EMISSIONS Norway's NOx Fund

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CONTENTS

AUGUST 2014 VOL. 119, NO. 8

SPECIAL SUPPLEMENT GREEN TECHNOLOGIES & SUSTAINABLE SHIPPING SPECIAL ADVERTISING SUPPLEMENT

31

Hull and equipment optimization is part of the drive for energy efficiency as ship operators look to cut fuel costs

features 16 COVER STORY

Captain of industry

How a kid from Brooklyn propelled TOTE onto the world maritime stage

21 SPOTLIGHT

Resilient spirit

AUGUST 2014

• As clock ticks, concerns mount over European ECA enforcement • Enhancing transport efficiency with Vulkan • Leaders in safety, responsible stewards of the environment • Reducing environmental impact without compromising power • And much more...

visit us at MARINELOG.COM 31 ENERGY EFFICIENCY

Regulatory impact and the role of technology

The quest for more efficient designs and ship operations will push the technology envelope

• Green Flag Award for Thome • U.S. ship sent to neutralize chemical weapons at sea

13 WASHINGTON Bipartisan bill aims to promote use of U.S.-flag ships for LNG export

A look back at McAllister Towing and Transportation’s 150 years in the business

departments

25 INSURANCE

It’s a family affair

DNV GL names new manager for Oil & Gas division in Europe

An increase in passenger liability and oil pollution response poses a challenge for owners and operators

6 INLAND WATERWAYS

35 TECH NEWS

Champions Unite!

Expanded portfolio catches Marco Polo’s eye

27 EMISSIONS

• Harvey Gulf orders hybrid support vessel from Eastern

Managing risk

Norway’s NOx Fund: A blueprint for others?

A catalyst for the development of new energy saving technologies in Norway’s shipping community, the NOx fund’s success could be replicated elsewhere

2 EDITORIAL

8 UPDATE

• USCG orders more FRCs • Lloyd’s Register to class CNG fueled Dutch ferry • ABS, Daewoo to develop the world’s first LNG drillship design

34 NEWSMAKERS

36 CONTRACTS

Burger Boat Company wins excursion boat contract

40 SHIPBUILDING HISTORY Escort carriers

August 2014 MARINE LOG 1

EDITORIAL

IT’S A FAMILY AFFAIR GOING INTO BUSINESS with your family isn’t always recommended. As the late George Burns once said, “Happiness is having a large, loving, caring, close-knit family…in another city.” But there is something about the maritime industry that just gets into your blood and binds families together.

Take for example Anthony Chiarello, the President and CEO of TOTE, Inc. Chiarello knows something about going into the family business. He is the fourth generation in his family to enter the shipping industry. His great grandfather operated a ferry service between Sicily and North Africa in the mid 1800s and his grandfather Diego started Chiarello Brothers (which later became American Stevedores) in 1898, after Anthony’s family immigrated to the U.S. and settled in Brooklyn. Anthony’s father, Richard, uncle and cousins all worked at

Chiarello Brothers.

For our cover story, we talk to this “kid from Brooklyn” about growing up in the family business and how it has led him to head a multi-million dollar shipping business onto the world stage. Now Anthony is ushering TOTE into a new era by overseeing the transition of the company’s fleet to burn Liquefied Natural Gas (LNG), including the construction of the world’s first LNG powered containerships.

If you’d like to learn more about Anthony and TOTE’s story, turn to “Captain of industry,” on page 16. Additionally, Anthony will be our keynote speaker at Marine Log’s All About Marine Conference, which is scheduled for Sept. 4, 2014 at the Beau Rivage Casino & Resort in Biloxi, MS. All About Marine is actually four conferences in one, with tracks on LNG, Shipyards, The Jones

John R. Snyder, Publisher & Editor jsnyder@sbpub.com

Act, and Environmental Compliance.

You can get more details by visiting www. marinelog/allaboutmarine.

And speaking of old New York families, this month Associate editor Shirley Del Valle takes a stroll through maritime history with Buckley, Brian, and Eric McAllister as they talk about the 150th anniversary of McAllister Towing & Transportation. Buckley, President, and Eric, Chief Financial Officer, are the fifth generation of McAllisters at the helm of the company, which was founded by James “Whiskers” McAllister as the Greenpoint Lighterage Co. when Lincoln was President and the Brooklyn Bridge was not yet part of New York City’s skyline. You can dive into McAllister Towing’s colorful history, a story of dedication, hard work and a smidgen of Houdini magic, by turning to “Resilient spirit” on page 21.

MARITIME TRIVIA Trivia Question #17: What vessel was known as the King of Derelicts?

The first sailor or lubber who correctly answers the Maritime Trivia question will receive a color J. Clary collector print. Email your guess to: marineart@jclary.com

Answer to last month’s trivia question, “Where, because of its location, does the difference between high and low tide usually measure no more than a foot?” On the island of Tahiti, because of its location, the sun has more effect on the tide than the moon, and the difference between high and low tide there is usually no more than a foot.

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MARINELOG AUGUST 2014 VOL. 119, NO. 8 ISSN 08970491 USPS 576-910 PRESIDENT Arthur J. McGinnis, Jr. amcginnis@sbpub.com

INTERNATIONAL SALES DIRECTOR Louise Cooper lcooper@sbpub.com

PUBLISHER & EDITOR-IN-CHIEF John R. Snyder jsnyder@sbpub.com

NATIONAL SALES DIRECTOR Jeff Sutley jsutley@sbpub.com

ASSOCIATE EDITOR Shirley Del Valle sdelvalle@sbpub.com

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4 MARINE LOG August 2014

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INLAND WATERWAYS

CHAMPIONS UNITE! T HE WAT ER RESOURCES REFORM AND DE VELOPMENT ACT (WRRDA) of 2014,

signed into law by President Obama on June 10, changed the cost-sharing formula for the remaining balance of the Olmsted project to 85% General Fund, 15% Inland Waterways Trust Fund (IWTF) (from 50%-50%). This will free up approximately $105 million per year for funding other Trust Fund priority projects on the inland system. This was just one provision, among many others, that will allow a more streamlined policy approach to modernization of the inland waterways system’s lock and dam infrastructure.

Now that WRRDA has been enacted, there remains an urgent need for Congressional revenue committees to act to increase the user fee that barge and towing companies pay into the IWTF. This user fee—currently 20-cents-per-gallon of fuel used while operating on the inland system—should be increased to 26- to 29-cents-per-gallon. This amount is matched by General Treasury Funds and is dedicated to new construction and major rehabilitation of the inland system. This user fee increase is supported by those who pay it—just 300 commercial operators —while the entire nation benefits from hydropower, municipal water supply, recreational boating and fishing, flood The enactment of WRRDA will help modernize the inland waterways system’s lock and dam infrastructure

6 MARINE LOG August 2014

control, national security, and waterfront property development.

While the industry, led by Waterways Council, Inc., and its many stakeholders have sent letters of support to increase the user fee to Members of the House Ways & Means Committee and the Senate Finance Committee, on June 26, Senator Dianne Feinstein (D-CA) and Senator Lamar Alexander (R-TN) sent a letter to Senate Finance Chairman Ron Wyden and Ranking Member Orrin Hatch expressing their support for the user increase. See the letter, at: http://waterwayscouncil.org/wp-content/uploads/2013/01/ user-fee-alexander-feinstein-letter.pdf Just as in the pairing of Senator Barbara Boxer (D-CA), Chairman of the Senate Environment & Public Works Committee, and Ranking Member Senator David Vitter (R-LA) to move WRRDA to success, the bipartisan support of Senators Feinstein and Alexander to push for the user fee makes perfect sense. Perhaps diametrically opposed in most areas, these Senate heavyweights have joined forces for the benefit of this transportation system that creates and sustains jobs, grows exports, and positions the nation for the Panama Canal expansion next year.

These leaders understand that the inland waterways provide the most cost-competitive

Michael J. Toohey, President/CEO, Waterways Council, Inc.

transportation option for our bulk commodities used in America and exported to marketplaces worldwide. And that an effective and efficient water transport system is essential to supply American farmers with the agri-inputs they need for planting season; that the waterways are vital to our manufacturing sectors and to the construction industry; and that American consumers benefit from transportation cost-savings that are made possible by the inland waterways.

For every $1 invested in our inland waterways, $10 is returned in national benefits!

Most of America’s locks and dams were built in the 1920s and 1930s, yet are used to transport 21st century cargoes that fuel our modern economy. This critical component of the transportation supply chain needs reinvestment and recapitalization, and a WRRDA bill that joins industry supported project delivery reforms with an industry sought increase in the user fee it pays is fiscally responsible.

WCI and its supporters will continue to push forward on increasing the amount of investment needed to keep America and her cargoes moving on our marine highways, and for our nation’s economic recovery to be complete.

Visit www.waterwayscouncil.org. ■

COMING SOON 250 TON AHC CRANE and JONES ACT-COMPLIANT

UPDATE BIZ NOTES Coast Guard orders more FRCs from Bollinger

HARVEY GULF orders hybrid support vessel H A R V E Y G U L F I N T E R N AT I O N A L Marine, Inc., New Or leans, LA, has inked a contract w ith Eastern Shipbuilding Group, Inc., Panama City, FL, to construct a hybrid Multi-Purpose Field Support Vessel (MPFSV).

Based on a Rober t Allan RAmpage 6400 design, the vessel—Eastern Hull No. 234—is will be delivered by the shipyard in April 2016, when it will begin a 10-year charter.

The vessel is the 14th vessel ordered at Eastern by Harvey Gulf in the past 13 years. The 9,384 bhp hybrid MPSV will measure 212 ft x 59 ft x 25 ft and be fitted with two GE Marine 12V250MDC IMO II, EPA Tier 4i marine diesel engines, each producing 4,694 hp.

The hybrid system will be comprised of two 1,000 kW induction shaft motor/generators with a DC bus via bi-directional variable frequency drives (VFDs).

The vessel’s generators—two main and one an emergency generator—will be

provided by Cummins. The main generators will be Cummins QSK 19Dm Tier3, generating 3,350 kW of power at 1,800 rev/min.

Meanwhile, the emergency generator is a Cummins/CMSL QSB7-DM generating 120 kW of power at 1,800 rev/min.

Schottel will provide two Model SRP 3030 CPP in nozzles for main propulsion and two STT 2FP bow thrusters powered by 600 kW electric motors.

The MPFSV will be U.S. flagged and classified ABS +A1, AMS, Circle E, ACCU, ACP, UWILD, FFV-2, DP-2, Offshore Support Vessel, Notation (DSV Capable, ROV Capable), AH, TOW, SUPPLY, HAB+ (WB), ENVIRO. Robert Allan Ltd’s Rampage Series of offshore support vessels and tugs are designed for high-performance towing and anchorhandling in critical offshore terminal and oil field support. The vessels are able to maintain station in extreme ocean conditions, with enhanced maneuvering and sea-keeping capabilities.

THE U.S. COAST GUARD has exercised an option worth $255.1 million with Bollinger Shipyards, Lockport, LA, for the production of six more Sentinel-class Fast Response Cutters (FRCs) and three sets of deep insurance spares. This option brings the total number of FRCs under contract with Bollinger to 30 and the total value of the contract to nearly $1.38 billion. To date, the U.S. Coast Guard (USCG) has taken delivery of 10 FRCs. Nine FRCs have been commissioned into service, and the tenth, Raymond Evans, will be commissioned this September in Key West, FL.

Making an impact In the field, the USCG says that the FRC is already making a significant impact.

On May 2, 2014, Coast Guard Cutters Paul Clark and Charles Sexton teamed to achieve the Sentinel class’ first two drug interdictions, seizing more than 2,100 pounds of marijuana and 35 kilograms of cocaine with a combined wholesale value of more than $3 million.

Leveraging the upgraded speed and enhanced communication capabilities and information technologies that the Sentinel class provides, the two cutters were able to locate and apprehend two suspect vessels within a 24-hour period, all of the time maintaining awareness of each other’s actions as well as sending and receiving information from Coast Guard MH-60T and MH-65D helicopters supporting the case.

The FRC has a flank speed of 28+ knots and a 2,500 hours per year operational employment target.

TOY TO SERVE EIGHT YEARS IN PRISON after MSC bribery sentencing FORMER AFLOAT Programs Manager at the U.S. Navy Military Sealift Command, Kenny E. Toy has been sentenced to serve 96 months in prison for receiving bribes.

In about November 2004, Toy joined an extensive bribery conspiracy that spanned five years, involved multiple co-conspirators, including two different companies, and resulted in the payment of more than $265,000 in cash bribes, among other things of value, to Toy and to Scott B. Miserendino Sr., a former government contractor who performed work for MSC. At his plea hearing, Toy admitted that 8 MARINE LOG August 2014

he accepted monthly cash bribes of about $3,000, as well as a flat screen television and a paid vacation, from co-conspirators Dwayne A. Hardman, Roderic J. Smith, Michael P. McPhail and Adam C. White, all of whom were employed at a government contracting company referred to as Company A in court documents.

Toy also admitted that he accepted a $50,000 cash bribe in May 2009 from Hardman and another co-conspirator, Timothy S. Miller, both of whom were employed at a government contracting company referred to as Company B in court documents.

In exchange, Toy provided favorable treatment to Company A and Company B in connection with MSC related business.

As part of his guilty plea, Toy also admitted to engaging in a scheme to conceal his criminal activity—including causing more than $88,000 to be paid to Hardman in an attempt to prevent Hardman from reporting the bribery scheme.

In addition to his eight-month sentence, Toy was also ordered to serve a supervised release term of three years following his prison sentence, and ordered to forfeit $100,000.

Inland • Coastal • offshore • deepsea

LLOYD’S REGISTER to class CNG-fueled Dutch ferry A NEW ECO-FRIENDLY double-ended Dutch ferry that will run on Compress Natural Gas (CNG) as fuel will be classed by Lloyd’s Register.

The 1,750-passenger, 350-car ferr y, named Texelstroom, will operate between the Dutch islands of Texel and Den Helder.

The ferry will combine the use of different innovative technologies and sources providing the operator, Royal N.V. Texels Eigen Stoomboot Onderneming (TESO), with a vessel that runs on efficient power and has a reduced environmental impact.

Texelstroom will be built at Spain’s LaNaval Shipyard. Delivery is expected at end of 2015.

The ferry will have two independent engine rooms—one will be fitted with two ABC diesel engines; and the other with two ABC dual fuel engines. The propulsion package will be completed with two Rolls Royce azimuth propellers installed on each end of the ship. The ferry will travel at an operating speed of ten knots and a maximum speed of 15 knots.

The ferry will operate mainly on natural gas stored in two batteries of CNG bottles installed on the top deck. The advanced energy management system will also feature electric batteries. Rounding out its green energy sources is over 700 m2 of solar panels.

The design of the ferry was supported by the European Union’s “I.Transfer” Program, which aims to make ferry transport freely accessible and sustainable.

The ferr y will be Ice Class and feature a strengthened hull. It will also have a notation for Passenger and Crew Accommodation Comfort (PCAC).

“Winning the contract for this highly innovative ferry demonstrates LR’s ability to help shipowners manage the introduction of new technology with confidence,” says John Hicks, VP for Global Passenger Ships, Lloyd’s Register. “Our teams in Spain and the Netherlands helped the client in delivering solutions to the engineering and regulatory challenges involved in this exciting contract. This is a robust design with the ability to operate in safety and efficiency in all conditions.”

MOL TAKES DELIVERY of state-of-the-art coal carrier JA PA N’S MITSUI O. S.K . Lines, Ltd. recently took delivery of the 91,094 metric tonne coal carrier Soma Maru, from the Mizushima Shipyard of Sanoyas Shipbuilding Corporation.

Jointly developed by Sanoyas Shipyard and MOL, the Soma Maru has an overall length of 235m, beam of 43m, and a depth of 20m.

www.smsllc.com

The state-of-the-art coal carrier features a wide-beam/shallow-draft shape and various safety and energy-saving specifications. It is a sister vessel to the Akatsuki, which was delivered in February of this year.

The ship will play a vital role in transporting coal for Tohoku Electric Power Co., Inc’s thermal power plants under a new longterm consecutive voyage service contract.

www.classnk.com

August 2014 MARINE LOG 9

UPDATE

CLASSIFICATION SOCIETY ABS, DAEWOO SHIPBUILDING to jointly develop the world’s first LNG-fueled drillship design CLASSIFICATION SOCIETY, ABS, Houston, TX, has joined forces with South Korea’s Daewoo Shipbuilding & Marine Engineering (DSME) to develop the world’s first Liqufied Natural Gas (LNG) fueled drillship.

The joint development project (JDP) will combine DSME’s experience in developing and applying LNG technology to floating

structures with ABS’ technical standards and experience working on gas-fueled, LNG regasification unit projects. The goal is for the JDP to address challenges associated with storing and managing cryogenic LNG safely.

To initiate the project, DSME has come up with a concept design; has performed a comparison between two types of LNG

storage tanks and conducted an analysis of the fuel gas supply system that will be installed on the drillship.

Meanwhile, ABS’ part in the deal will see the classification society conduct a concept design review, basic engineering review and a risk assessment of the tank space and access area, fuel gas supply system, machinery spaces and access area and associated configurations.

The project builds on years of collaboration between ABS and DSME, says Dr. Hoseong Lee, ABS Vice President, Global Korea Business Development and ABS Korea Energy Technology Center, Busan. “We are targeting the Gulf of Mexico as a key market for an LNG-fueled drillship where, given the abundance of affordable shale gas resources in the U.S., LNG as a marine fuel makes good economic sense.”

“Many North American vessel owners and operators are making the switch to LNG to achieve substantial operating savings by reducing fuel consumption and lowering emissions to meet the strict sulfur requirements in the North American Emissions Control Area,” says ABS Executive Vice President, Energy Development Ken Richardson. “An LNG-fueled drillship is another groundbreaking concept that illustrates how deepwater applications are evolving.”

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A ship passes by protected wetlands when a container full of sandwich bags goes over the side.

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Inland • Coastal • offshore • deepsea

GREEN FLAG AWARD for Thome Ship Management from Port of Long Beach SLOWING DOWN pays off. Thome Ship Management, part of the Thome Group, learned that when it was recently awarded a Green Environmental Achievement Award by the Port of Long Beach, California, for its high performance standards in 2013.

The award is presented to operators, whose ships call at the por t, and have demonstrated that 90% or more of the

vessels have been compliant under the Vo l u n t a r y Ve s s e l S p e e d R e d u c t i o n Program. The program rewards vessel operators for slowing down to 12 knots or less within 40 nautical miles of Point Fermin, near the entrance to the Harbor.

Vessel speed in the speed reduction zone is measured and recorded by the Marine Exchange of Southern California.

The port says that because ships emit less when they travel more slowly, the program has been highly successful in reducing smog-forming emissions and diesel particulates from ships. The program prevents more than 1,000 tons a year of air pollution.

In June, the port handled 610,000 TEUs of cargo, an eight percent increase over the same period last year.

BC Ferries’ LNG-fueled vessels to be built at Remontowa BC FERRIES HAS AWARDED Poland’s Remontowa Shipbuilding with a $165 million contract to build it’s three new LNGfueled ferries. The ferries will be the first BC Ferries to operate on dual-fuel.

Two of the new 105 m ferries will replace the 49-year old Queen of Burnaby and 50-year old Queen of Nanaimo on the Comox-Powell River route; and the Tsawwassen-Southern Gulf Islands route, respectively.

The third ferry will provide service on the Southern Gulf Island route during peak season—as well as provide refit relief to the fleet.

Each ferry will carry 600 passengers.

“This is an exciting initiative for BC Ferries that can reduce environmental emissions substantially,” says Mark Wilson, Vice President of Engineering at BC Ferries.

The ferries will be classed by Lloyd’s Register and will be built to LR’s Rules. Bud Streeter, President, LR Canada, says “Our job was, and will be, to help ensure safety and reliability in the design, build and the bunkering and operation of these ships.”

He adds, “Passengers are the most valuable cargo so we will endeavor to contribute to the safe operation of these ships.”

To ensure safety, LR’s surveyors will survey the ferries during construction—as well as on regular intervals throughout their operational lifespans. Additionally, to ensure the safety of bunkering and all LNG operations LR will support overall risk management.

The first ferry will be delivered August 2016, the second will follow in October 2016, and the third in February 2017.

August 2014 MARINE LOG 11

UPDATE U.S. SHIP SENT TO NEUTRALIZE 530 tons of chemical weapons from Syria at sea A SPECIALLY OUTFITTED U.S. Ready Reserve Force Roll-On/Roll-Off/container ship will sail to the Port of Gioia Tauro in Calabria, Italy, to be loaded with 530 tons of chemical weapons from Syria for destruction at sea.

On the U.S. Department of Transportation blog , Maritime Administrator Paul “Chip” Jaenichen posted that the ship, the

648 ft M/V Cape Ray, “was the United States’ key contribution to the joint Organization for the Prohibition of Chemical Weapons (OPCW)/United Nations international effort to eliminate the Syrian stockpile of chemical weapons, and it provides the latest reminder of the important role America’s merchant mariners play in supporting our national security as well as our economy.”

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12 MARINE LOG August 2014

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The chemical weapons are currently aboard the 13,500 dwt Danish ship M/V Ark Futura in the port. Once loaded on the Cape Ray, the chemical weapons will be destroyed at sea.

State of readiness The M/V Cape Ray (T-AKR 9679) is part of the U.S. Ready Reserve Force (RRF), a fleet managed by the Maritime Administration (MarAd), to provide for rapid mass movement of Department of Defense (DOD) equipment and supplies to support U.S. Armed Forces and respond to national and humanitarian emergencies.

Each vessel in the fleet is maintained to remain in a state of readiness so that a full activation can be achieved quickly and the ship certified as mission ready. In nearly every case, MarAd completes RRF vessel activation in five days or less.

The Maritime Administrator said: “This level of readiness was the reason the Cape Ray, the assigned ship manager, Keystone Shipping Services, Inc., and the all-volunteer U.S. Merchant Marine crew were able to prepare for this historic mission in a very short time.

“Converting a sealift vessel into an OPCW-verified chemical weapons destruction facility was no easy task, given the scope of the mission, the number of government agencies and commercial companies involved, and the extensive vessel modifications required. Without question, this was a first of its kind project for the U.S. Department of Transportation.

“The unique mission required the team to make significant modifications, including installation of additional berthing, office, and messing spaces; a medical unit; reverse osmosis water purification units; a commercial-grade helicopter landing deck for emergencies; an environmental enclosure with carbon filtration; separate filtered air handling systems; and two Field Deployable Hydrolysis Systems to neutralize and convert chemical agent materials into liquid compounds not usable as weapons.

Once modifications were completed, extensive in-port and at-sea testing were conducted. A diverse team from more than 20 different organizations worked tirelessly to test and improve the vessel’s capabilities to ensure that chemical weapons could be handled and neutralized safely. Measures were also put in place to ensure there would be no impact on the environment or harmful effects on human life when the M/V Cape Ray returns stateside.”

INSIDE WASHINGTON

Bipartisan bill aims to promote use of U.S.-flag ships for LNG export L AT E L A S T M O N T H , Re p. D u n c a n Hunter joined with his fellow Californian, Rep. John Garamendi, to introduce H.R. 5270, the Growing American Shipping Act in a move to leverage the current shale gas boom in the U.S. to boost domestic shipping.

The bill would authorize the Secretary of Transportation to develop and implement a program to promote the export of Liquefied Natural Gas (LNG) on U.S.-flag vessels, and require the Secretary to give priority in the processing of export applications for deepwater port terminals that would use U.S.-flag vessels.

There are currently no U.S.-flag LNG carriers. The last LNG ships built in the U.S. were constructed by General Dynamics at its Quincy, MA, shipyard in the late 1970s. General Dynamics built 10 LNG carriers, eight for Energy Transportation and two for Lachmar Shipping. According to its website, General Dynamics American Overseas Marine currently operates and manages three of the Moss-type 125,000 m3 LNG ships.

According to ABS Record, the LNG Virgo (ex Virgo) is owned by Patriot IV Shipping Corp., LNG Gemini (ex Gemini) is owned by Patriot I Shipping Corp., and the LNG Leo (ex Leo), owned by the Patriot II Shipping Corp. The three Patriot Shipping Corporation firms have C/O General Dynamics addresses. All the ships are currently under the Marshall Island flag.

Two LNG carriers built for Lachmar, Lake Charles and Louisiana, are now named the LNG Edo and LNG Abuja.

The registered owner for the ships is Bonny Gas Transport Ltd., and the ship manager is Nigeria LNG ltd., according to the Equasis database. Both vessels fly the Bahamian flag.

Rep. Duncan Hunter (R-CA-50), the Subcommittee’s Chairman, joined the legislation as an original cosponsor with Rep. John Garamendi (D-CA), who is the Ranking Member of the House Transportation and Infrastructure’s Coast Guard and Maritime Transportation Subcommittee.

Under the current law, the Secretary of

Transportation is authorized to develop and implement a program to promote the transportation of imported LNG on U.S.flag vessels. Under the Deepwater Ports Act, the Secretary is also required to give top priority to the processing of licenses for LNG import facilities that will utilize U.S.-flag vessels.

Commenting on the legislation, Garamendi, says, “In order for businesses to grow, they must identify new opportunities and seize them. The export market for LNG, a strategic national asset, is ready to take off. At the same time, our nation’s maritime industry has been declining for years. Our nation must take the bull by the horns. When it is deemed appropriate to export LNG, it should be on Americanflagged vessels.”

Adds Chairman Hunter, “A strong U.S. maritime industry is essential to the national economy and global security. This legislation will help strengthen this industry by promoting LNG export opportunities on U.S. flag vessels — which is most certainly in the national interest.”

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August 2014 MARINE LOG 13

MARINE LOG CONFERENCE & EXPO

Sept. 4, 2014 Biloxi, MS

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BEAU RIVAGE RESORT & CASINO 888-567-6667 $89/Night (+$9 Daily Resort Fee)

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One Day. Four Tracks.

Forty Experts Speaking ALL ABOUT MARINE.

KEYNOTE ADDRESS Anthony Chiarello President & CEO, TOTE Chiarello will address environmental stewardship and compliance, including TOTE’s plans to build the world’s first LNG-powered containerships.

LNG

LNG as a marine fuel has made strong in-roads in the U.S., but there are still questions regarding the supply of LNG and how vessels should be refueled.

This track will examine what vessels, infrastructure and training are needed to support the growth of this industry.

Topics: • LNG Training • LNG Fueling Infrastructure • The First U.S. Flag Offshore Support Vessels • The European Experience

Environment

Jones Act

Shipyards

Topics: • What’s Happening at IMO? • Wastewater Discharge • Ballast Water Regulations • Hybrid & Electric Technology

Topics: • Energy Independence • International Cabotage Laws • Waivers to the Jones Act • Is the Jones Act Inhibiting Petroleum Movements?

Topics: • Avoiding OSHA Violations • New Construction Outlook • Ship Repair Outlook • Corporate Culture of Safety

Cash-strapped ship operators aren’t only concerned about the economy, but also environmental compliance and criminal liability. Ship operators often must comply with confusing and impractical series of regulations and standards.

This track provides practical, real-world steps for compliance.

The U.S. will be the world’s largest oil producer by 2015, surpassing Saudi Arabia and Russia. This track will explore not only the opportunities for the U.S. to be “energy independent,” but also to export oil and gas and what it means for the U.S. flag fleet and shipbuilders.

With vessel construction opportunities increasing, shipyards are expanding their workforces. This track will look at some of the most successful programs for shipyard safety, training and retention, as well as examine the markets for vessel construction and repair.

Sponsorships & Exhibits: 212-620-7208 • conferences@sbpub.com CORPORATE SPONSOR OF LNG TRACK

COVER STORY

CAPTAIN OF INDUSTRY A “kid from Brooklyn” pushes TOTE onto the world maritime stage

A

s Anthony Chiarello tells it, he’s just a kid from Brooklyn that went into his family’s business. “My great grandfather and grandfather had a ferry service from Sicily to North Africa.

When my grandfather immigrated to the U.S. in the late 1800’s, he started a stevedore and terminal operations business in New York.

They had a small shipyard with tugboats and lighters and were in business until the late 1960’s when they sold the business to one of their competitors. So my family has been in the maritime business for four generations, so you could say I was born into it.”

That’s how Chiarello, President and Chief Executive Officer of 16 MARINE LOG August 2014

By John R. Snyder, Publisher & Editor in Chief

TOTE, Inc., recounts his maritime roots. Anthony’s grandfather Diego, father Richard, uncles and cousins all worked in the family-owned stevedoring and terminal company originally founded as Brooklyn-based Chiarello Brothers in 1898. Diego had immigrated along with his parents and six brothers to the U.S. from Sciacca, a small town in southwestern Sicily, in the early 1890’s. Back in Sciacca, Anthony’s great grandfather operated a ferry service from Sicily to North Africa.

Anthony’s father, Richard “Dick” Chiarello, was a well-known figure in New York shipping circles. When he was just 17, Dick started

COVER STORY as a clerk for the International LongId millam, si aspid est quasperovid shoremen’s Association, working as an Korea’s Doosan Engine, under et quisciur, voluptaqui inum license from MAN Diesel and employee for his father Diego’s stevedordolendae eventemque ditio mi, Turbo, delivered the first ing occus and terminal company, American dit, susdam cus estiuri 8L70ME-GI engine Stevedoring (formerly Chiarello Brothbusdae. Icipiet aut aces etur aute ers),dolestr in Brooklyn. Dick held various management positions at American Stevedoring and after the business was sold to Universal Maritime, he later worked with Prudential Lines and Delta Lines in New York and Baltimore.

As of this month, it has been four years since Anthony Chiarello joined TOTE, Inc.—what was then American Shipping Group—as its President.

Chiarello explains that he received a call from a headhunter looking for possible candidates to fill a particular position. “He was looking for names.

I knew of Totem and their service to Alaska, but I didn’t know much at all about their parent Saltchuk.

After passing names along, the headhunter convinced me to throw my name in the hat. They went through that progression over a number of months. Over that time span, Chiarello became more excited by the NVOCC and consolidator Caribtrans and the Caribbean basin’s preopportunity to join the company. “The more I learned about mier marine cargo insurance company Seven Seas Insurance. As an Saltchuk, the more I was intrigued by their values and their entreinternational foreign-flagged shipping operation, Tropical and its preneurial spirit. They were truly wonderful people and a group I related companies will become Saltchuk’s sixth line of business. felt comfortable around.”

As is Saltchuk’s model, Tropical Shipping will continue to operWhen he joined the Saltchuk family in 2010, Chiarello brought ate as a standalone operation under its existing management team, with him 30 years of shipping and logistics experience. He joined headed up by Rick Murrell, Tropical’s CEO. the company from the NYK Logistics (Americas) Inc., where he served as COO and Executive Vice President. His subsequent expe- The shift to LNG rience included serving as Senior Vice President, Global Customer When Chiarello joined the American Shipping Group in the sumDevelopment, AMB Property Corporation. His resume also includes mer of 2010, it wasn’t but a few months after that the company began serving with various Maersk companies, including as Chairman some intensive investigation relative to the use of Liquefied Natural and President of Hudd Distribution Services, Inc., President of Gas (LNG) as a marine fuel. The investigations were specific to conMaersk Logistics USA, Inc., Chairman of Maersk Customs Services, verting the company’s 2003-built Orca Class Roll-on/Roll-off ships President of Maersk Equipment Service Company, and Universal that operate in the Alaska trade to burn LNG. Maritime Service Corporation.

The investigations were triggered by the creation of the North American Emissions Control Area (ECA) by the International Maritime Organization (IMO), following its amendment of MARPOL Transformation at TOTE Annex VI designating the waters 200 nautical miles off of the U.S. Under the leadership of Chiarello, in 2012 TOTE reorganized its five independently managed businesses into three groups: Maritime, and Canada as an area regulating greenhouse emissions from ships.

The aim of the ECA was to improve air quality by reducing nitrogen Logistics and Ship Management. oxide (NOx), sulfur oxide (SOx), and particulate matter (PM) emisThe groups are organized as: TOTE Maritime: Totem Ocean Trailer Express and Sea Star Line; TOTE Ship Management: sions from ships operating in U.S. coastal regions, whether they are U.S. or foreign flagged.

Interocean American Shipping; and TOTE Logistics: Alta Logistics While the stricter emissions regulations are expected to be painand Spectrum Logistics.

The reorganization coincided with the renaming of the American ful to ship operators—the overall cost of the North American ECA is projected to be $3.2 billion by 2020, says the U.S. Environmental Shipping Group to TOTE, Inc. as of January 1, 2012.

The move not only strengthened the company’s overall brand, but Protection Agency (EPA)—its health and respiratory benefits are expected to be enormous. The EPA says the ECA could prevent as also trumpeted the company’s ambitions to expand globally. At the many as 14,000 premature deaths and relieve respiratory ailments time, Chiarello, said, “We felt the ‘America...’ name was somewhat limitfor five million people in the U.S. and Canada. Overall, the healthing with our goal of expanding our logistics services beyond the USA.” Saltchuk has a portfolio of over twenty independent companies, related benefits in the U.S. are estimated at $110 billion in 2020.

The first phase of the emissions regulations came into effect organized in to six operating groups, TOTE, Inc. being one of them.

August 2012. As of January 1, 2015, sulfur content in fuel will be lowThis past April, Saltchuk inked a binding purchase agreement to ered to 0.1%. Beginning in 2016, NOx after-treatment requirements acquire Tropical Shipping and its related companies. Tropical Shiping operates in the Caribbean and the Bahamas, and is a leading will become applicable.

August 2014 MARINE LOG 17

COVER STORY This year, an ECA zone around Puerto Rico and U.S. Virgin Islands became effective.

According to Chiarello, the Ponce Class ships that operate in the Puerto Rico trade were provided an extension until 2019 to comply with the ECA regulations, “so our discussions were really focused on the Orca Class ships. What were the best options for these 10-yearold assets? Our technical staff at TOTE and ship management group spent a lot of time looking at various options. They came back to leadership of TOTE and Totem with the recommendation that LNG would have the positive potential environmental effects and turn out to be the best option.”

Chiarello says the company spent the better part of well over a year working on the retrofits, most of the time consulting with MAN Diesel & Turbo, who supplied the engines currently operating in the Orca Class vessels.

He says those discussions centered around engineering and fabricating conversion kits for the engines. “We were going down that path very aggressively when we announced the LNG conversions on the Orcas in August 2012.”

But then, explains Chiarello, “MAN had a change of heart relative to its ability to economically and effectively create and engineer the conversion kits for the engines. It was a matter of engineering capacity in their network at the time to meet the timelines that we established, as well as a determination of the number of engines of that specific class and type around the globe that would be candidates for LNG conversions. When they did an analysis, they thought it wasn’t in their best interests to go forward.”

At that point, TOTE had to step back and reevaluate its options.

“We went out to bid for new engines that would burn LNG as fuel.

And we made a decision to go with Wärtsilä. That’s the path that we’re going to go with now.”

The change from converting the existing MAN B&W diesel engines to swapping out for Wärtsilä dual fuel engines also meant a switch in strategy on how the conversions would be accomplished.

The original intention was that the majority of the work would be done while the vessels were in service. Any other work that needed to be performed would have been done during the ships’ normal dry dock cycle.

However, the engine replacement plan is going to require that the ships go into dry dock. “Our intention is to do it over the winter months, which tend to be the slowest time within the Alaska trade from a commercial perspective,” he says. Chiarello estimates that ships will be out of service between eight to 10 weeks for the reengining and conversion. While the ships are out of service, Chiarello expects to supplement with other carriers’ assets, whether barge, ship or over the road options.

Totem Ocean’s fleet of two Orca Class Roll-on/Roll-off cargo ships—M.V. Midnight Sun and M.V. North Star—transport about one-third of all the goods required by the inhabitants of Alaska.

Cargo includes essential items such as food, household goods, vehicles, construction materials and military supply support.

As a result of the conversion to LNG, the Orca vessels will virtually eliminate SOx emissions, reduce particulate matter (PM) by 91 percent, NOx by 90 percent, and carbon dioxide (CO2) by 35 percent.

The plan is to install four 12-cylinder Wärtsilä 50DF dual-fuel engines and generator sets. The engines will have the ability to burn either natural gas, light fuel oil or heavy fuel oil. Additionally, Wärtsilä is supplying each ship with two 1,100 m³ LNG fuel storage tanks and the associated automaton and fuel gas handling systems through its LNGPac system. Wärtsilä will also be responsible for the design, engineering and integration of the system, as well as project and site management for its scope of supply.

18 MARINE LOG August 2014

IN THE BAG: Massive 380-ton stainless steel LNG storage tanks were recently delivered to General Dynamics NASSCO

What was also critical for TOTE was the early involvement of the U.S. Coast Guard in the decision-making process. “We knew the Coast Guard and the EPA,” says Chiarello, “would play a very important role if we were going to go forward with the conversions, both from a regulatory perspective and an operational perspective, so they were involved very early in the discussions. They were both very good partners from the beginning. The whole process was transparent. We didn’t want any surprises on anything that we might have forgotten that would fall into the sphere of responsibility of either the EPA or the Coast Guard.”

Chiarello points out that the decision to go dual fuel was simple.

“In case there was ever a problem with getting supply, we can go with a back up without any service interruptions. Second, being U.S. flag and U.S.-owned company, we could make the ships available to the U.S. government in times of war,” he adds.

“One of our Alaska vessels,” relates Chiarello, “recently provided troop support. If that was to ever happen again, having LNG as the only fuel option might make it difficult for the government to get supply. Dual fuel capability provides backup. It’s not only the sheer distance that they would be traveling, but also the ability to get supply around the globe.”

Chiarello called estimates of $80 million to $100 million to complete the two conversions “in the ballpark.”

World first: LNG-powered containerships Just months after the announcement of the conversion of the Orca Class ships to LNG, on December 10, 2012 the other shoe dropped—TOTE was going to build what would be the world’s first LNG-powered containerships at General Dynamics-NASSCO. While not the first owner to jump to LNG—New Orleans-based Harvey Gulf International Marine, Inc., had already announced its move to LNG the year prior for a new class of dual fuel Platform Supply Vessels—TOTE’s bold initiative was the first thread of a string of other Jones Act ship operators to order LNG or “LNG-ready” tonnage. There is currently an estimated $3 billion in orders for LNG or LNG-ready newbuilds at North American shipyards.

Construction on the first containership is nearly 40 percent complete, with the start of the construction of the second Marlin Class

COVER STORY

Artist’s rendering of the Marlin Class containerships showing LNG storage tanks aft

ship expected in late May 2015. Just last month, Korea’s Doosan Engine, under license from MAN Diesel and Turbo, delivered the first 8L70ME-GI engine for TOTE’s 3,100-TEU Marlin Class containership. Earlier this year, Doosan completed the engine’s Factory Acceptance Tests, a culmination of months of testing to ensure compliance with U.S. regulations and restrictions. TOTE is the launch customer of the ME-GI engine, a significant advancement in propulsion technology.

In addition to the engines, two 900 m 3 tanks, manufactured

by Cryos, were delivered. These massive stainless steel cryogenic tanks weigh 380 tons each and will store liquefied natural gas aboard the Marlin ships.

The containerships are designed by DSEC, the design arm of Korea’s Daewoo Shipbuilding & Marine Engineering (DSME). The design will include DSME’s patented LNG fuel-gas supply systems and a MAN ME-GI dual fuel, slow speed engine.

“These vessels are the largest investment in our company’s history,” says Denise Tabbutt, one of the three sisters who are primary shareholders in TOTE’s parent company, Saltchuk Resources. “We have a tremendous amount of confidence in the NASSCO team and we are lucky to have such incredible partners.”

TOTE has applied for a Title XI ship loan guarantee to construct the two ships. The requested loan amount is $320 million, with the actual cost to TOTE of $366 million, according to the Maritime Administration website.

The LNG container ships are expected to enter service in late 2015 and early 2016.

Award winning TOTE has garnered awards from both the international community, as well as here at home. TOTE along with GD-NASSCO were recognized last year at Nor-shipping 2013 in Oslo, Norway, with a Next Generation Award for setting a benchmark for green ship technology.

Chiarello was named as a Champion of Change by the Whitehouse earlier this year for the company’s fleet changeover to LNG. “I’m extremely honored and proud of that recognition, but from my perspective, it was the result of the entire organization—the Saltchuk organization, the TOTE organization and the many people involved.

To create the opportunity based on the things we are doing in the LNG arena, the Orca ships and the Marlin ships. I accepted that award on behalf of the entire organization. It was an honor to be recognized but from our perspective it is recognition for the entire group.”

20 MARINE LOG August 2014

Refueling with LNG TOTE has already announced publicly how it plans to refuel its new 3,100-TEU dual fuel Marlin Class containerships under construction at General Dynamics NASSCO, San Diego, CA, for service between the Port of Jacksonville, FL, and Puerto Rico. Pivotal LNG, Inc., a wholly owned subsidiary of publicly traded AGL Resources, and WesPac Midstream LLC were selected by TOTE, Inc. to provide LNG for the new dual fuel containerships.

Additionally, a joint venture between Pivotal LNG, Inc. and WesPac plans to develop a new LNG plant in Jacksonville.

AGL Resources is one of the largest operators of liquefaction facilities in the nation primarily through its distribution utility operations that use the LNG facilities for peak-shaving services for customers when demand is highest.

In addition, Pivotal LNG owns and operates a merchant LNG facility and sells LNG wholesale to truck fleets and other high horsepower engine operators.

WesPac is a private energy infrastructure company with several small LNG facilities under development in North America.

Chiarello says the company has a supplier for LNG “locked in” for the Port of Tacoma for the Alaska trade, but doesn’t plan to publicly announce it. “We’re comfortable with the partners that we’ve chosen.”

Positive reinforcement “We consider ourselves extremely fortunate at how positive our decision to switch to LNG has been supported by the regulatory bodies, networks and port authorities,” continues Chiarello. “And NASSCO has been a phenomenal partner. They are doing the engineering for the Orcas. At the same time, they have begun the construction of the Marlins that will meet our timeline and perhaps beat our timeline.

I couldn’t be happier where we are in the process. Things have gone extremely, extremely well.”

So what’s in the future for TOTE? Will they be adding more LNG newbuilds? “We had an option for an additional Marlin Class vessel,” says Chiarello, “but we are sticking with the two vessels in Alaska and Puerto Rico service. While you never say never, with a half billion dollars in assets in play, that’s going to keep us busy for a while.”

He’s well aware of TOTE’s presence on the world stage. “We have to stay focused so we don’t miss a beat. International carriers have their eyes set on what is going on here. They know that LNG is the fuel of the future. For them it is more about supply. We are honored and humbled to be in the position we are in.”

Not bad for a kid from Brooklyn. ■

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AUGUST 2014

As clock ticks, concerns mount over European ECA enforcement Shipowners want harmonized approach to new sulfur limits

Compiled by Marine Log Staff

W

ith regulations requiring 0.1 percent sulfur content in fuel due to take effect January 1, 2015, shipowners are concerned that policing of the Northern European Emissions Control Areas (ECAs) by port state control agencies will be spotty at best.

As we reported in our June 2014 Yearbook issue, “Chaos reigns as Europe’s new ECA-based fuel regime approaches,” some shipping companies that are abiding with the spirit of IMO’s MARPOL Annex VI are putting themselves at a competitive disadvantage with others who have adopted a wait and see attitude.

Last month, Maersk Line noted that, while the North American ECA requirements are strongly enforced, “the current weak enforcement of the North European ECA requirements combined with the significant cost burden increase in 2015 might lead to increased noncompliance. This would not only weaken the positive effect on air quality, it would also be a major competitive disadvantage for the shipping companies that follow the rules.”

Maersk Line says that ECA regulations coming into force in 2015 will cost it around $250 million a year in additional fuel costs. That extra cost will be borne by customers, says the container shipping giant, in the form of bunker surcharges in affected regions between $50 and $150 per 40 ft container.

In a statement issued by Maersk Line earlier this month, it says that “new legal requirements will come into force in the Emission Control Areas (ECA) in North Europe (Including the Baltic Sea, North Sea and English Channel) and North America (200 nautical miles from the American and Canadian shore). This legal requirement will lower the maximum allowed content of sulfur in fuel burned in the ECAs to 0.1% sulfur from today’s 1.0%.

“The 2015 requirements will have significant positive effects on the environmental and health in the regions and Maersk Line fully supports such a development, subject to strict regulatory enforcement to safeguard the environmental benefits and ensure a level playing field for ship operators.

“This requirement will have the following effects and implications for society, Maersk Line, and our customers: “Environment and Health: sulfur emissions (SOx) will be reduced by 90% which will have significant positive effects on the environment and on health in general. SOx emissions are toxic and cause respiratory implications as well as acid rain.

“Maersk Line: Fuel with a sulfur content of 0.1% is significantly more expensive than fuel with 1.0% sulfur content required in ECA areas today. By 2015, Maersk Line expects to purchase 650,000 tonnes of fuel with 0.1% sulfur content annually for our fleet, equal to 7% of

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all fuel purchased. Based on the current price difference of $300 per ton (approx. 50%), the additional cost to Maersk Line will be around $250 million per year. On top of that, Maersk Line will face increased costs for buying services from third-party feeder operators, who will also have increasing fuel costs.

“Customers: To offset the additional cost incurred, Maersk Line will incorporate the higher average fuel costs into the existing standard bunker surcharge (SBF). We expect that additional cost to customers in affected trades will be between USD 50 and 150 per 40 ft container to and from main ports, depending on transit time inside ECA areas and whether touching ECA areas at both origin and destination. Reefer containers will incur higher cost due to fuel used to generate power on board vessels; also cost will fluctuate depending on the volatility of low sulfur fuel prices.

“Maersk Line will communicate more detailed SBF increases per trade when we get closer to implementation date and price difference between the different fuel types can be more precisely estimated.”

SHIPPING COMPANIES PRESS PARIS MOU Meanwhile, the International Chamber of Shipping (ICS) is asking the Paris Memorandum of Understanding on Port State Control to ensure that a harmonized approach to port state inspections relating to the new sulfur limits is developed in advance of the January 1, 2015 deadline.

ICS says that information collected by its member national ship owners’ associations suggests that many governments are not yet prepared to implement the requirements in a uniform manner, in order to ensure the prevention of a potentially serious market distortion.

ICS Secretary General, Peter Hinchliffe explained: “The shipping industry is investing billions of dollars in order to ensure compliance with this major regulatory change, and the huge costs involved could have a profound impact on the future structure of the entire shipping industry. We therefore think it is vital that governments get the details of any PSC intervention right as we enter a new world in which fuel costs for many ships will increase overnight by 50% or more.”

He added: “There is only six months to go and it is vital that the Paris MOU and its Member States – in co-ordination, as may be appropriate, with the United States and the European Commission – clarify all of the details of ECA implementation with respect to PSC inspection as soon as possible. ICS believes it is important for the maintenance of fair competition that implementation occurs throughout the Paris MOU region in a consistent and harmonized manner.”

ICS has just written the Paris MOU raising a number of PSC inspection issues relating to the new limit. These include: Whether – as ICS believes should be the case – the principal method of inspection will only involve looking at the bunker delivery note (BDN), with further sampling/analysis of fuel only normally taking place when examination of the BDN suggests clear grounds to suspect non-compliance, or when there is a previous history of noncompliance with MARPOL Annex VI; The procedures to be followed, with reference to applicable IMO Guidelines, in the event that sampling or analysis is undertaken during PSC inspections; The procedures that might be followed with respect to ships that transit an ECA without calling at a Port State located within an ECA; The extent to which a consistent approach will be shown with respect to any discretion for minor technical violations (e.g. those that might arise from fuel switching when a vessel enters an ECA) as opposed to deliberate use of the wrong grade of fuel, or with

respect to any discretion that might be applied for a limited period after January 2015.

Criteria to be applied during PSC inspections with respect to alternative compliance measures such as Exhaust Gas Cleaning Systems (“scrubbers”) or LNG. Scrubber issues that ICS believes require a harmonized approach include the acceptability of “closed loop” and “open loop” systems, and the extent to which overboard discharges will be subject to inspection.

TESTING SCRUBBERS, TOO DuPont subsidiary Belco Technologies Corporation, Parsippany, NJ, has partnered with the Maersk Group to successfully demonstrate Belco Marine exhaust gas scrubber technology aboard the 8,112 TEU containership Maersk Tukang.

The Belco Marine Scrubber was tested over six days in May 2014 as it sailed from the Port of Algeciras, Spain, to Genoa, Italy. Representatives from Belco and Maersk were on board.

An ABS surveyor was present to witness and monitor the full testing as the system awaits class certification, expected later this year.

The scrubber was installed in a Qingdao, China, shipyard during a scheduled drydocking.

The unit is designed to clean SOx and particulates from exhaust gas emissions from a 3.2 MW auxiliary engine. Open loop tests confirmed that Belco unit achieved 100 percent compliance with MARPOL Annex IV regulations for all air and washwater emission criteria.

Closed loop testing is scheduled for early fall 2014. Belco says it fully expects a successful demonstration since it has been engineering closed loop wet scrubbing systems for refineries and other land-based applications for over 20 years.

FUEL PROCUREMENT STRATEGY Singapore-headquartered marine fuel trading company Dynamic Oil Trading is urging ship owners and operators to prepare now to ensure that they can still meet their supply requirements for compliant products within ECAs, and to work collaboratively with their fuel suppliers in order to minimize the impact on their operations and profitability.

Lars Møller, CEO of Dynamic Oil Trading, says that while there are other options for shipowners to comply with ECA requirements such as scrubbers and alternatives fuels such as LNG, those won’t be “deployed in large numbers in the short term.” Møller says, “This leaves most owners and operators looking at distillates as the most viable solution. Not only do these carry a significant price premium, but the implications of the new low sulfur rules on fuel availability are also unclear, given the uncertain impact on both fuel supply and demand.”

He thinks that operators should lay out a fuel procurement strategy. “Waiting until the last minute risks compromising on availability, quality and price.”

Continues Møller: “We are encouraging our customers to be proactive in mapping out the precise fuel requirements of their ECA operations, in order to secure the fuel they need on the best possible terms and in a way that meets their specific operational needs.

“Secondly, owners and operators must speak to their preferred fuel supplier now and get their advice on securing access to high quality, ECA-compliant products from trusted physical suppliers. A knowledgeable supplier will be able to advise on how best to secure the fuel that is required. There is no guarantee that all physical suppliers will be able to supply the compliant products that are needed, in the right place, and at the right time, as availability in some ports could be patchy. The only way to avoid the risk of an impact on operations August 2014 MARINE LOG S1

or the risk of non-compliance with the 2015 ECA standards is to prepare now.

“Finally, we encourage all owners and operators to look at the price hedging tools that are at their disposal. There is an array of risk management strategies that operators can use to limit their exposure to fuel price fluctuations and to lock-in costs now, which not only helps to keep fuel bills as low as possible, but also provides greater certainty over costs. We can advise our customers on the

most appropriate hedging instruments to employ, based on their commercial strategy, their appetite for risk and the anticipated price trends in the marine fuel market.

“There is uncertainty across the entire industry over the impact of the new sulfur regulations, but this can be managed and the costs can be mitigated through a proactive approach to planning ahead and by working with fuel supplies in order to adapt fuel procurement strategies for ECA voyages.”

EXXONMOBIL ROLLS OUT NEW LOW-SULFUR FUEL IN EUROPE THE CLOCK IS TICKING for ship operators that operate in an Emissions Control Area (ECA) to comply with the 0.1 percent sulfur cap on marine fuel, set to go into effect on January 1, 2015.

While there are concerns about the general policing of the Northern European ECA—comprised of the Baltic Sea, English Channel, and the North Sea—among ship owners, ships calling at Rotterdam or at the ports of Amsterdam or Antwerp will be able to bunker with ExxonMobil Premium Heavy Distillate Marine ECA 50 (HDME 50), a new category of marine fuel formulated to meet the 2015 ECA sulfur limit and to help marine engineers safely and efficiently operate their engines and boilers.

Operators can purchase the fuel in Antwerp, Rotterdam, and Amsterdam— some of the busiest ports in Europe. Last year, Rotterdam had 29,448 seagoing vessels call at the port and another 99,000 inland vessels. The fuel is barged from Antwerp. There are no plans currently to expand the fuel’s availability to other ports “What’s notable about the new fuel,” says Iain White, Field Marketing Manager, Exxon Mobil Marine Fuels & Lubricants, “is that ExxonMobil Premium HDME 50 carries the benefits of both Marine Gas Oil (MGO)

and Heavy Fuel Oil (HFO). The fuel can be stored in a heated tank.”

ExxonMobil Premium HDME 50 contains a low sulfur content associated with MGO, and has the higher flashpoint and lower volatility properties typically found in HFO. These characteristics enable marine operators to comply with the upcoming sulfur cap and to reduce the risk of engine and boiler damage.

The higher viscosity of Ex xonMobil Premium HDME 50 makes storage and handling the fuel on board similar to HFO. With the fuel having to be heated, the risk of thermal shock to engine components is reduced during switchovers when entering and leaving an ECA. Thermal shock can result in fuel pumps seizures and engine shutdowns.

Prior to its introduction, ExxonMobil Premium HDME 50 was tested with Wallenius Wilhelmsen Logistics, one of the world’s leading shipping and logistics groups, and is suitable for use in main and auxiliary engines and marine type boilers.

Following successful field trials, the new fuel has received No Objection Letters from MAN Diesel & Turbo (MDT) for use in MAN B&W two-stroke and MAN B&W Holeby genset designs, provided MDT’s specific engine type guidelines are followed.

ExxonMobil Marine Fuels’ Iain White (left)

S2 MARINE LOG August 2014

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August 2014 MARINE LOG S3

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W&O debuts new fittings for SeaCor piping system W&O announces new fittings for the SeaCor marine thermoplastic piping system by Georg Fischer. The addition of Schedule 80 drain waste and vent (DWV) fittings will complete the current product offering for SeaCor Schedule 80 thermoplastic pipe.

Customers will now have access to a complete thermoplastic piping system solution, with one material and one installation process, for use in all non-essential grey, black and freshwater water applications.

The SeaCor system is the only commercially available thermoplastic plastic piping systems that meets the IMO/SOLAS USCG requirements for flame spread, low smoke and tox-

icity. SeaCor has been approved for shipboard use through the ABS Type Approval program and is approved for marine use by Transport Canada.

W&O worked alongside Georg Fischer to expand the product line which now includes unions, plugs, ball, check and butterfly valves, as well as special pipe supports and other installation accessories.

Georg Fischer designed the fittings

and is manufacturing the new, one-of-a-kind molds in its USCGapproved U.S. manufacturing facility in Little Rock, AR. The addition of the DWV fittings allows W&O to offer the SeaCor system for all shipboard sanitary and technical water management requirements. The same system can be used to collect grey and black water, and bring it back for treatment and eventual discharge.

W&O offers SeaCor installation training required by USCG and ABS approvals, along with the IMO resolutions. Training can be organized at a location of the customer’s choice or at the local W&O facility, facilitated by one of the company’s certified trainers. www.wosupply.com

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by GF Piping Systems YOUR SOURCE FOR THE ONLY USCG APPROVED MARINE THERMOPLASTIC PIPING SYSTEM W&O is the proud North American distributor for the groundbreaking SeaCor™ piping systems from Georg Fischer – the first and only commercially available United States Coast Guard-Approved (USCG) marine thermoplastic piping system in the world. SeaCor is also the only thermoplastic piping system that meets the requirements of Transport of Canada. Light in weight and long-lasting, the corrosion-resistant SeaCor piping system is a unique, cost-saving solution to optimize vessel performance.

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S4 MARINE LOG August 2014

Valves

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Fittings

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Actuation

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Engineered Solutions

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Founded on safety and protecting the environment 150 years ago Driven by our purpose of safeguarding life, property and the environment, DNV GL enables organizations to advance the safety and sustainability of their business. We provide classification and technical assurance along with software and independent expert advisory services to the maritime, oil and gas, and energy industries. We also provide certification services to customers across a wide range of industries.

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August 2014 MARINE LOG S5

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Enhancing transport efficiency with Vulkan System Solutions For years now, Vulkan has remained committed to producing increasingly efficient drive technology.

Stringent demands on performance, such as operating times of up to 7,000 hours per year, in addition to maximum maneuverability are just some of the requirements commercial vessels need to meet.

Additionally, there is the requirement for low-space drive systems in order to gain maximum room for loading and further enhance transport efficiency. To cater to these requirements, diesel-electric systems are being deployed in ships in conjunction with rudder propellers. VULKAN Couplings provide an entire product portfolio for these demanding diesel-electric high-power and high-performance

drives. The use of our low weight composite shafting eliminates or reduces the numbers of shaft line bearings, thus lowering the energy loss in the shaft line, which reduces fuel consumption.The new ACOTEC compound as used in RATO-R+ couplings has higher thermal resistance and a lesser ageing effect, so smaller couplings can be used. This also benefits the higher spec output of today’s engines.

Vulkan Couplings is a business division of the international Vulkan Group. The division operates in the field of transmission technology.

Over the years, Vulkan’s highly flexible couplings, dampers, mounts and drive line components have acquired growing worldwide reputation. In the head office

in Herne (Germany) and in the production facilities in Brazil, USA, China and India couplings are being manufactured for: Ships’ main and auxiliary drives, PTO’s and PTI’s, Boat drives, Generator drives.

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S6 MARINE LOG August 2014

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Leaders in safety, responsible stewards of the environment As responsible stewards of the environment, shipowners and shipbuilders must be mindful of domestic, international and industry environmental standards. Numerous green regulations comprise the rules of lawful sea transportation.

ABS is the industry’s top resource to keep informed of new regulations and to learn the specifics of regulatory compliance. We know how to identify and implement proven, cost-efficient solutions to surpass green benchmarks and achieve smooth sailing for companies seeking classification, certification and statutory services.

Whether it’s regulations dealing with air quality, bilge water, marine ambient noise or the prevention of volatile organic compounds, ABS’ Asset Performance Management (APM) team is here to assist your company with improving environmental performance.

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dynamic assessment techniques, the ABS APM team works together with the owners and operators to develop company-specific vessel and voyage energy strategies to minimize waste and maximize cost efficiency.

ABS is also providing guidance and aid to owners and operators to make informed decisions related to energy savings devices, hull efficiencies, and other technical decisions that will impact energy efficiency.

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South Korea’s Daewoo Shipbuilding & Marine Engineering (DSME) to develop what would be the world’s first LNG-fueled drillship. This includes a joint development project to address challenges associated with storing and managing cryogenic LNG safely. This project combines DSME’s experience developing and applying LNG technology to floating structures with ABS’ technical standards and experience working on a number of gas-fueled, LNG and regasification unit projects.

For more than 150 years ABS has been at the forefront of the latest technology trends and regulatory requirements impacting the marine and offshore industry. As our track record shows, we are committed to working alongside our members and clients in preserving the natural environment. Whether seeking to meet new regulations, or proactively implementing technologies and practices to improve environmental profiles, ABS stands ready to work with the marine and offshore industries.

ABS will class Harvey Gulf International’s six dual fuel Platform Supply Vessels

August 2014 MARINE LOG S7

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Scania: Reducing your vessel’s environmental impact without compromising power Scania embraces every effort to reduce the effects on climate and environment. This is why emission control goes hand-in-hand with

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EMS AND UI SAVES MONEY AND IMPROVES THE ENVIRONMENT. Scania’s electronic Engine Management System (EMS) was developed in-house. It is extremely dependable, and designed to stand up to heavy use and harsh condition. In addition, it makes a major contribution to cutting fuel consumption and emissions.

The same is true for the Unit Injectors (UI or PDE) that are at the heart of the most reliable, well-proven injection system on the market. It is a robust system for tough operating conditions.

PLUG AND PLAY ELECTRICAL SYSTEM AND INSTRUMENTATION. The electrical system and instrumentation are custom tailored to the Engine Management System. Its functionality is optimized to match the intelligence of the EMS. The results are better control functions, easy to understand monitoring, quick location of faults, and programming options that can be customized for the engine’s area of application. www.scaniausa.com

S8 MARINE LOG August 2014

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AvK Provides 17MW of Power for Diving Support Vessel

6 AVK DIG 156 alternators and an AVK DSG 86 alternator

The diving support vessel Seven Atlantic was designed by IHC Merwede Offshore & Marine in collaboration with the vessel’s owner, Subsea 7, and the maritime engineering company Bakker Sliedrecht.

Seven Atlantic’s power is generated by 6 AvK DIG 156 alternators from Cummins Generator Technologies, specified by Bakker Sliedrecht. The 6 AvK DIG 156 alternators are backed up with an emergency generator set featuring an AvK DSG 86 alternator.

Being one of the most advanced and most capable diving vessels in the world, Seven Atlantic contains a broad range of diving and ROV (Remotely Operated Vehicle) equipment and a 120-ton crane for subsea on board. The vessel also features a 24-man saturation diving system rated to 350m depth, twin diving bells orientated port and starboard with two hyperbaric lifeboats.

With a length of 145m and a breadth of 26m Seven Atlantic is one of the largest diving support ves-

sels worldwide. Bakker Sliedrecht, who is the world leading engineering company for complete electrical systems on high-engineered ships, was responsible for the delivery of the alternators, generating sets, the emergency generator, the entire electrical installation on the ves-

sel, the main switchboards, various frequency drives and propulsion motors, the motors for the thrusters and several rotating converters.

The 6 AvK DIG 156 diesel alternators on Seven Atlantic are divided over three engine rooms and have a maximum output of 3,600kVA, a speed of 720 rev/min, a voltage of 6,660V and a frequency of 60Hz. The emergency alternator has a maximum output of 1,875kVA, speed of 1,800 rev/min, voltage of 440V and a frequency of 60Hz. This is only one of many projects where Bakker Sliedrecht has specified AvK alternators. The reputation for quality and reliability, coupled with outstanding technical support made AvK the perfect partner for Bakker. Seven Atlantic’s sister ship, the Seven Pacific, also part of the Subsea 7 fleet, features 5 AvK alternators providing 17MW of power.

For more information on Cummins Generator Technologies’ AvK range of marine alternators visit www. stamford-avk.com/applications

Launched at the IHC Merwede yard in Hardinxveld Giessendam, Netherlands, the Seven Atlantic operates in the North Sea based in Aberdeen, Scotland

August 2014 MARINE LOG SC3

Marine Power Solutions with | Technology leaders in synchronous generator design and manufacture, Cummins Generator Technologies has a proven track record of delivering dependable power solutions for the marine market.

With 50 years of experience in the marine sector, Images courtesy of Bakker Sliedrecht customers benefit from a comprehensive range of products under our STAMFORD® and AvK® brands. You can expect active support throughout your entire project lifecycle - including preparation of specifications, installation, testing and commissioning, after sales service and maintenance.

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SPOTLIGHT

RESILIENT SPIRIT

McAllister Towing and Transportation celebrates 150 years

H

ow does a company stay in business for a century and a half—surviving and thriving during a Civil War, two World Wars, and the Great Depression? McAllister’s formula: reinvesting, constantly, in its business and in the industry’s future.

This September, New York-based, and family-owned McAllister Towing and Transportation celebrates its 150th anniversary. The company, one of the oldest and largest marine towing and transportation companies in the U.S., was founded in 1864—at the time, Lincoln was President, the American Civil War was still raging and the Brooklyn Bridge was yet to make up part of the now famous New York City skyline.

FOUNDING FATHER The company got its start when Captain James “Whiskers” McAllister, an immigrant from Ireland, founded it with a single sail lighter. He named the business the Greenpoint Lighterage Company—before it went on to carry the McAllister name. The lighter was used to carry cargo from the borough of Manhattan across the East River to Brooklyn.

James, who is remembered through family lore as being a tough guy and having a “knack for overcoming setbacks,” would go on to bring relatives from Northern Ireland to work for him, making the business, truly a family one.

Today, McA l lister operates a f leet of more t ha n 70 tugb o a t s a n d b a r g e s i n 17 l o c a t i o n s a l o n g t h e U. S . E a s t C o a s t f r o m Po r t l a n d , M E t o S a n Ju a n , P R a n d i s l e d by fourth (Captain Brian McAllister) and fifth generation McAllisters (Buckley and Eric).

By Shirley Del Valle, Associate Editor

EBB AND FLOW Managing to survive in an industry that is always changing, is no easy task. Trying to keep that business in the family isn’t either.

McAllister’s history has been riddled with trying times from a son being fired for putting “a diesel engine on an old tug with a bad boiler” (Founder James “Whiskers” McAllister fired son A.J. but later reinstated him); the Great Depression; to the business being split a number of different ways.

But every time McAllister gets knocked down, it finds a way to get back up.

Talking to the company’s Chairman, Captain Brian McAllister, who is the great grandson of founder James McAllister, and a member of the fourth generation of McAllisters, is like stepping back into New York Harbor’s heydey, bristling with ship and tug activity.

Brian began working for the family business in 1943 when he was just 12 years old. Thirty-one years later, in 1974, he would go on to buy the company from his father for $20 million.

At the time McAllister had already made ship docking its primary business, after the lighterage business dwindled following World War II—but the mid 1970’s brought a new opportunity to McAllister in the form of oil.

Not one to miss an opportunity, McAllister stepped up to the plate when Mobil Oil, the principal owners of Aramco, wanted to move 12 million barrels of oil from Saudi Arabia. To accomplish their goal, they needed powerful tugs to do the job. In came McAllister with 4,000 hp, flanking rudder, twin-screw tugs.

Soon, though, as with all things that rise, the price of oil collapsed from $40 to $7 a barrel, rigs were shut down, and in the August 2014 MARINE LOG 21

SPOTLIGHT 1980s McAllister saw the need to sell off the 18 vessels it had working in the Saudi region. Belco Petroleum, which ironically enough McAllister would come to own later on, bought eight boats—the remaining 10 vessels were sent to Peru.

By 1998, the oil business was out of McAllister’s hands afterthe company was sued by one of its outside partners. Under the court’s ruling, McAllister would keep its tug, towing and ferry business (Bridgeport and Port Jefferson Steamship Company), while the oil business would be awarded to the outside partner.

(From left to right) Currently at the helm of the company: Buckley, Capt. Brian and Eric McAllister; Founder James “Whiskers” McAllister

FINDING BALANCE While the oil business was lost, McAllister was able to keep its ferry service—an operation that has been credited with keeping the company afloat during difficult times.

Established in 1883 by P.T. Barnum, the Bridgeport & Port Jefferson Steamboat is currently owned and operated by McAllister Towing & Transportation. The McAllister’s initially had a minority stake in the company before taking on ownership.

“In the early 1980’s,” explains Buckley, “McAllister proposed to ramp up the operation with the construction of two new ferries which would increase the capacity and speed of operations.”

But when the other owners showed no interest in taking on the debt required to pay for new vessels, McAllister took it upon itself to make the investment. “Since that time, the ferries have acted as a nice counterbalance to the tug operation,” says Buckley.The ferry operation features three passenger/car ferries. Each ferry has the capability of carrying 1,000 passengers and 100 cars.

NEW GENERATION, NEW FLEET When current McAllister President, Buckley McAllister, spoke

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before attendees at Marine Log’s 2013 Tugs & Barges Conference, he noted that McAllister’s business strategy has remained the same throughout the years: “Take care of your customers, take care of your employees and reinvest resources back into business.”

Reinvesting in the business has long been part of the McAllister tradition. Buckley says, “Whatever money was made in the business went back into the business.” This, in essence, helped founder Captain James amass of f leet comprised of tugs, barges, derricks and passenger-carrying sidewheelers before his passing in 1916.

That reinvestment spirit remains alive and well—most prominently, over the last two decades. With sons Buckley and Eric on board, McAllister has reinvested in its fleet—operating some of the most powerful tugs on the East Coast. The McAllister’s know full well that fewer ships are being docked at ports—on average, calls at ports have dropped five percent a year—but the few ships that do come in and dock are large and require more powerful, expensive tugs.

To meet demand, over the last 14 years, McAllister has added two tractor tugs to its fleet per year. Those z-drive tractor tugs feature

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SPOTLIGHT the latest firefighting equipment and capabilities. McAllister has invested heavily in technologies and vessels that will meet the industry’s growing transportation and regulatory demands.

Its fleet of over 1,000 hp consists of 24 Z-drive tractor tugs, six Tier II compliant tugs, 20 plus vessels involved in coastal towing and 35 ABS load line class vessels.

Recently, the company took delivery of the Buckley McAllister from Senesco Marine, North Kingstown, RI. Named after company President Buckley McAllister, the 5,100 hp, 92 ft x 36 ft Jensen designed ASD tug will provide service on the Cape Cod Canal. The Tier III compliant tug is fitted with a pair of 3516C HD diesel engines from Caterpillar, rated at 2,575 hp at 1,800 rev/min. The Buckley is ABS classed, can reach a speed of 12 knots and has a bollard pull of 67 tons.

The Eric McAllister, named after the company CFO, is the next addition to McAllister’s f leet, and is currently under construction at Senesco. The Tate, named after famous actor Tate Donovan (who also happens to be a cousin), is being built at Washburn & Doughty, East Boothbay, ME. Another piece of the reinvestment puzzle is McAllister’s role at ports down the United States East Coast. Over the course of its history the company has expanded its business, setting up towing operations at various ports. It currently operates in Baltimore, MD; Charleston and Georgetown, SC; Jacksonville, FL; New York, NY; Philadephia, PA; Port Everglades, FL; Portland, ME; Providence, RI; San Juan, Puerto Rico; Virginia; and Wilmington, NC.

A TOUCH OF MAGIC When Marine Log made its way over to McAllister’s headquarters in Battery Park—a mere five-minute walk from our own offices— we were surprised to learn that magician Harry Houdini had

enlisted the help of McAllister back in 1914.

As the story goes, Houdini was forbidden to perform his Underwater Box Escape act off of the piers, so he used a McAllister tug, invited the press on board and performed the act on July 15, 1914 off of Battery Park.

The act involved his hands being cuffed and his legs shackled.

Once Houdini was in, the box was closed and nailed shut, rope was tied around it and it was weighed down before being lowered into the river.

According to a 1914 New York Times article, Houdini was thrown into the water from the tug J.A. McAllister. The Times reports that 15,000 came to watch Houdini perform the stunt off of Battery Park, where he reappeared on the surface of the water in a minute.

RESILIENCY IN THE FACE OF ADVERSITY McAllister’s legacy will be in the next generation—not only of McAllisters but of future mariners as well. The company is involved in both the PVA (Passenger Vessel Association) and AWO (American Waterways Operators). It is also a co-sponsor, along with Morty Bouchard, for the Cafeteria at SUNY Maritime, Fort Schuyler, Bronx, NY. As the McAllisters put it, they want to invest in the industry’s future labor force. “We want to be here for the long haul.” Captain Brian as well as Buckley are SUNY Maritime alumni.

As Buckley told our Marine Log audience, “resilience is the ability to both endure adversity and recover from a disabling event.”

For McAllister Transportation and Towing, its trajectory hasn’t been easy. Throughout its 150-year history, it has faced trying times, but its real character shows in how the company manages to remain afloat in spite of what storm comes its way. ■

MT_Natural gas_tug_1_2_032014

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C26:33 lean-burn LNG engines provide enhanced operational efficiency, a 22% reduction in CO2 emissions and a 92% reduction in NOx emissions. SOx and particulates are also negligible and methane slip is at very low levels.

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August 2014 MARINE LOG 23

FOR TRUE RISK REDUCTION, YOU HAVE TO LOOK DEEPER Noble Denton Marine Assurance and Advisory

Our Noble Denton Marine Assurance and Advisory services have been setting the standard in marine warranty for over 50 years. Much of the industry follows our guidelines, standards and rules, and we have contributed significantly to developing global best practice in marine operations. But, with the oil and gas sector working on more complex projects in increasingly challenging environments, we believe that the benchmark can always be higher.

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11/07/2014 10:21

INSURANCE

MANAGING RISK

By Grantley Berkeley, Chairman, IGP&I

S

hipowners and operators need to be able to mitigate and manage the risks inherent in ship owning and operating.

It is the job of the global insurance industry to ensure the availability of adequate and sustainable insurance cover. The International Group of Protection & Indemnity Clubs play a key role in this, ensuring the availability for shipowners and operators of the highest limits, and broadest range, of marine liability insurance coverage that can be provided.

The global economy is highly interdependent and could not function were it not for ships and the shipping industry.

Whether it is the food on people’s tables, the technology that is a vital part of today’s businesses or the fuel that powers transport and factories, the items that are considered the basic necessities of modern life are brought to their respective consumer markets by sea.

For trade to continue, shipowners and operators need insurance products, and marine insurers, including the P&I Clubs, need to be in a position to meet these needs. The International Group Clubs have been responding to the shipowners’ needs for marine liability insurance, in some cases, for over 150 years. The International Group system has ensured that shipowners have

Increase in passenger liability and oil pollution response pose challenges Originally published in the IGP&I’s Annual Review 2013-2014

the highest limits, and broadest range, of marine liability insurance cover which can be provided, coupled with unparalleled expertise, experience, advice and support in claims handling and loss prevention advice.

The world fleet continues to grow The world merchant fleet is now around 1.14 billion GT, of which around 1.02 billion GT (or roughly 90%) is insured by the International Group Clubs. During 2013, the world f leet grew by an estimated 3.8% in terms of gross tonnage and by 1.7% in vessel numbers. It is forecast that both the absolute number of vessels, and tonnage, will continue to grow until at least 2024. It is also likely that container ship tonnage, which has roughly doubled since 1996, and now accounts for around 17% of the world f leet, will continue to grow over the coming years. All of this will present new opportunities and challenges for the Clubs, the Group and the Group’s reinsurers.

A difficult trading environment, 2013 again proved a difficult year for shipowners, with average earnings for all vessel types (with the exception of offshore and LNG vessels), significantly below the August 2014 MARINE LOG 25

INSURANCE 10-year average. The ClarkSea Index reached $15,885/day in January 2014, somewhat above the 1990s average values of $12,000/ day but well below the 2000s average of $22,250/day. The projected growth in the world fleet will provide little comfort or assistance in driving firmer rates for shipowners and operators. The key will be to drive efficiencies in operating expenses to improve returns without compromising on safety and training.

Achieving this goal will be helped by an increasingly modern global fleet with a reduced age profile, better hull and machinery design and fuel savings achieved through slow steaming.

Claims trends For 2013, Clubs are reporting significant levels of claims activity within the current $9 million retention. In excess of that, 17 claims were notified to the Group Pool ($9 million to $70 million), down from 25 in 2012, totaling approximately $465 million, down from approximately $687 million in 2012. Last year was another good year for new claims on the Group’s reinsurers, with only one claim notified with an exposure of less than $40 million to reinsurers.

Challenges This year has seen the entry into force of the Athens Convention 2002 Protocol, bringing with it a significant increase in passenger liability limits. The Protocol limits have been in force within EU member states since December 31, 2012. The increase in limits, coupled with the increasing size of passenger vessels, led the Group in 2006 to introduce a passenger limit of $2 billion, and a passenger and crew combined limit of $3 billion.

Regulatory developments continue apace, particularly in China, with a focus on requirements on shipowners in relation to oil

26 MARINE LOG August 2014

pollution response arrangements. These do, and will continue to, occupy an ever-increasing amount of Group resources and time.

In 2014 or 2015 Club boards will need to address the issues arising out of the Maritime Labor Convention 2006 in relation to crew back wages, which will come into effect in or around 2016. This relates to the financial security for wages owed to crews follow-

The entry into force of the Athens Convention 2002 Protocol brings with it a significant increase in passenger liability limits ing a shipowner’s insolvency. The Nairobi Convention on Wreck Removal will come into force in April 2015, and the Group is engaging with States who have yet to ratify on the dangers of not applying the Convention to territorial waters.

Within the Group, diversification by Clubs away from their traditional core mutual P&I businesses will undoubtedly raise challenges, and put new pressures on the Group system. Diversification may enable Clubs to enhance the benefits which they can offer to shipowners through the provision of more comprehensive insurance cover, but it also has the potential to damage or undermine the concept of mutuality, both within the Clubs themselves, and within the Group. It may also raise issues for Clubs with their respective solvency/financial regulatory authorities. The issue will be one of increasing focus within, and outside, the Group in the year ahead. ■

EMISSIONS

NORWAY’S NOX FUND: A blueprint for others?

Fund has been crucial in developing innovation, such as LNG as marine fuel

By Paul Bartlett, Contributing Editor

I

n its first seven years, Norway’s NOx Fund has proved to be a catalyst in the development of a range of new energy-saving technologies in shipping, such as LNG as a marine fuel. The Fund is due to expire in three more years, but Norway’s shipping community wants to see its life extended so that it can continue to pioneer initiatives to raise efficiency and boost shipping’s environmental profile.

International shipping is undergoing a period of unprecedented change as it enters a new era of growing fuel diversity, a drive to raise shipboard energy efficiency, and a need to embrace automated performance monitoring.

Ship operators are grappling with other challenges, too—an increasingly heavy regulatory burden, emissions compliance, ballast water management and, of course, another year in which all of shipping’s main markets are awash with tonnage and earnings remain stubbornly below average as a result.

Many owners now realize their very survival is at risk if they do not adapt. But access to suitable finance— either for retrofit projects or for new and more expensive propulsion systems on newbuilds—is an obstacle for many.

Norway’s highly successful “NOx Fund” could provide a blueprint for others. It works by charging a levy on ships operating in Norwegian waters based on their emissions of nitrous oxides (NOx). The funds so generated are then channelled as grants into the development and adoption of emissions-saving technologies.

So far, more than NKR 6 billion ($970 million) has been allocated to support projects including the use of Liquefied Natural Gas (LNG) as a marine fuel. For instance, Norway will have more than 100 gaspowered vessels by 2017. Other projects have focused on developing electrical power on board ships and even the application of a fuel cell on board an offshore support vessel.

Norwegian owners, including tug operators, ferry companies and Powered by the NOx Fund: Two gas-fueled firsts from Norway include the cargo ship Høydal (above) and the tug Borgøy (below)

August 2014 MARINE LOG 27

EMISSIONS Rolls-Royce gas engine in the MF Boknafjord, the world’s largest gas-powered ferry built at Fiskerstrand BLRT shipyard in Norway and operated by Fjord1

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firms running fishing vessels all concede that their moves into LNG as a marine fuel would not have come about without support from the NOx Fund.

Norway is not a member of the European Union, but is connected through its membership of the European Economic Area.

Before it established the Fund in 2007, therefore, it sought approval from the EU which has guidelines on state aid to industry and the Fund was granted a 10-year life until the end of 2017.

But experts point out the success of the NOx Fund to date and the fact that it has provided the financial support necessary for a range of innovative Norwegian projects to proceed. Moreover, they say, the grants have come over a period in which shipping’s traditional lenders have been anxiously reducing their exposure to the sector.

Global shipping will need to continue innovating, they say. But the end of the NOx Fund’s 10-year life will come just as ship operators everywhere face the earliest possible date for a global sulfur reduction in heavy fuel oil, from 3.5% to 0.5% in 2020.

This will transform the economics of ship operation. By 2030, consultancy firm PwC has estimated that low sulfur fuel oil is likely to cost more than $1,500 a tonne in 2014 prices.

Recognizing the funding challenge that shipping faces, companies and organizations have devised funding schemes to assist ship operators. The New York-based Carbon War Room, for example, partnered recently with the University of London Energy Institute to produce a study “Financial Models for Retrofits.”

Meanwhile, Copenhagen-based MAN Diesel & Turbo introduced PrimeServ Trident, a two-year financing scheme aimed at helping owners install energy-saving retrofits whereby project costs are financed out of fuel savings.

Marine coatings manufacturer International Paint has launched a scheme together with the Gold Standard Foundation in which carbon credits awarded as a result of fuel savings and reduced emissions can be used to offset the cost of premium hull coatings.

These are clever schemes as far as they go.

But the NOx Fund, although limited to Norway, has established an unbeatable and far more diverse track record in funding maritime innovation.

Sources reveal that the Norwegians will be doing everything they can to ensure that the Fund, or something similar, remains in place beyond 2017. But some experts suggest that the success of the Norwegian model could well be replicated elsewhere. ■

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ENERGY EFFICIENCY

REGULATORY IMPACT and the Role of Technology

While shipping and offshore industries have gone through many changes in the last 10 years, there are even more dramatic changes in the decades to come

By Kirsi Tikka, President & COO, ABS Europe Division

O

il exploration is moving to deeper waters and harsher environments and trade flows are evolving as new discoveries and unconventional sources join the energy mix. Shipping’s fundamental mission remains the same, but owners and operators must learn to adapt to a landscape that combines a volatile earnings environment with the challenge of high fuel costs and an influx of new regulations with a hefty price tag attached.

For the marine community, the quest for more efficient designs and ship operations will require the application of new technology, some of which has not yet been developed. This quest has two interrelated drivers: new environmental regulations on air emissions and the high cost of fuel.

REGULATORY DRIVERS On January 1, 2015 we will see a step change in the first of these, when the maximum sulfur permitted in marine fuel in the International Maritime Organization’s Baltic/North Sea Sulfur Emission Control Areas and the North American ECA will be reduced to 0.1%.

While the current 1.0% limit can be achieved with low sulfur residual fuel, the new, lower limit will effectively require ships to burn distillate fuels or use an alternative means of compliance.

Given that fuel costs can be around 70% of a ship’s operating expenses and the big price differential between heavy fuel oil, low sulfur fuel and distillate, these changes will clearly have a major impact on the cost of ship operations.

Another related regulatory development concerns climate change.

Following the example of other industry sectors, the IMO has led the development and adoption of its own energy efficiency regulations.

The Energy Efficiency Design Index (EEDI) measures the potential energy efficiency of a ship’s design at a specified condition while the Ship Energy Efficiency Management Plan (SEEMP) is more akin to a management system under which all ships are encouraged to implement operational best practices to improve the energy efficiency.

Even without further carbon-specific rules, it is clear that the IMO regulations, combined with the upward trend of the marine fuel prices are a major incentive to design, build and operate ships with the minimum fuel consumption and maximum achievable energy efficiency possible.

The industry in general agrees that there is potential for improvement, the majority of which is expected to come from implementation of new technology in ship design and operations. The question is how much improvement is possible and cost efficient, with the technology available to the industry in the next decade?

August 2014 MARINE LOG 31

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ENERGY EFFICIENCY CHANGING MINDSET For many years, almost the sole focus in ship design has been to maximize the cargo carrying capacity and to optimize the designs for production. While there have been technology improvements in ship design such as improved hull forms, better coatings, more efficient propellers and improvements to the efficiency of main and auxiliary engines, these have not had the same impact as conceptual changes and the introduction of bigger vessels.

The in-service performance of the ships has traditionally been specified at a single draft and for calm sea conditions, with a theoretical sea margin—conditions in which the ships seldom if ever operate. The majority of ships therefore have not been designed for the best operational efficiency.

The industry has also lacked a feedback system for operational performance. Ship classification has traditionally provided this for structural and machinery performance, by collecting data on failures and developing and amending rules that the future ships are built to, but no such system exists for operational performance and energy efficiency. Ship designers have limited knowledge on the performance of their designs in actual operational and different weather conditions.

The new regulatory and economic drivers for energy efficiency have led the engine manufacturers, propeller designers, ship designers, and increasingly the shipyards to develop new, energy efficient designs and equipment that can be used on both new and existing ships. Many old energy saving ideas have been resurrected and, with the help of more efficient computational tools, some of them have been commercialized successfully. Some novel ideas have been introduced but are still only at a concept stage.

DESIGN FOR EFFICIENCY At the same time, the industry is looking at ways to improve, measure, and benchmark operational efficiency. These start with the hull form, which is constrained by the functional requirements of the vessel. The changes for ships with a high block coefficient, such as bulk carriers and tankers, are focusing on the bow and the stern, whereas for lower block coefficient ships such as containerships, the hull lines overall are being optimized.

Available numerical tools have also improved and a large number of different hull forms can be analyzed before verification of the results by model tests. The same applies to the various energy saving devices such as ducts, propeller boss fin caps and pre-swirl devices. Computational fluid dynamics makes it possible to investigate the losses in the flow fore and aft of the propeller and to customize the energy saving devices to a specific hull form and rudder propeller configuration, as well as to study the propellerrudder interaction.

Appropriate selection of the propulsion system and matching of the propeller to the main engine is another key factor in the efforts to improve energy efficiency. The efficiency gains for propulsion have been considerable and the trend has been to move to slower RPM engines and larger propeller diameters.

The total potential improvements are a sum of many factors and therefore true energy efficiency calls for an holistic approach, including systems for power generation to cargo handling, heating and hotel loads.

Below the water line, the potential for marine coatings to increase efficiency by reducing friction and slime build-up is a focus of research and development. The latest anti-fouling coatings work at the molecular level to provide a degree of surface regeneration and future systems could incorporate nanotechnology to repel water and marine growth.

The demand for energy efficiency is changing the way ships and equipment are designed

NEW APPROACHES New materials are another potential source for a step change in ship design. Introduction of steel and welding made it possible to build ships larger in size and more economically. New types of steel with more ductility and higher tensile strength have been introduced to ship building but the use of other materials is limited. I predict that new materials will one day change ship construction and make the seaborne transportation even more energy efficient.

Performance monitoring systems with varying levels of sophistication are already available in the market. Some use hydrodynamic models to simulate vessel performance, others are based on statistical models, but many operators still rely on the data received from the vessel’s noon report. Significant improvements are possible and desirable using current computational, sensor and communications technology and this is an opportunity to demonstrate to shipping that the collection and analysis of ’ “Big Data” can have a positive benefit.

Another significant potential change is in the use of alternative fuels, and particularly the use of LNG as fuel. This still has challenges: the technology for LNG propulsion is available and the regulatory environment is still developing. Small vessels using LNG as fuel have been operating in Northern Europe for some time and the first containerships with LNG as fuel are being constructed in the US, but wider worldwide application is not yet in sight.

The scale of energy efficiency and regulatory challenge facing the shipping industry is considerable. Big changes in permissible fuels and the need for compliance, particularly in the U.S. and Europe together present considerable adaption challenges and risk for owners and operators. Even with the resurrection and refinement of some old concepts and the introduction of new tools and methodologies, we will very soon hit a “wall” in terms of the degree of savings that can be practically achieved.

These market needs and regulatory drivers have together created exciting opportunities for engineers and scientists. To make significant improvements in energy efficiency, a step-change is needed: the challenge to the research community is in the development of novel concepts and solutions that can significantly reduce the environmental footprint from shipping and make what is already an efficient mode of transportation, even more effective. ■ August 2014 MARINE LOG 33

NEWSMAKERS

DNV GL names new manager for Oil & Gas division in Europe TOBIAS ROSENBAUM has been named the new regional manager for DN V GL O i l & G a s ’ Continental Europe region. Rosenbaum, who will be based out of the Milan, Italy office, will be in charge of accelerating DNV GL’s growth in the region.

Lloyd’s Reg ister ha s made sever al key leadership appointment s, including naming Nick Brown its Marine Chief Operating Officer. Lloyd’s says Brown’s appointment “ref lec t s the g row th in Lloyd’s Register ’s Mar ine Business— both in scale and breadth of ser vices.”

Brown will be responsible for LR’s four global operating regions: Asia, Americas, Nor thern Europe and Southern Europe.

Additionally, LR named DAVID BARROW Regional Marine Manager (RMM) for the Northern Europe region; and APOSTOLOS POULOVASSILIS has been named RMM for Southern Europe.

Austal USA , Mobile, AL, has appointed L AWRENCE RYDER as its Director of Customer Relations, Navy Programs.

In his new role, the retired Marine, will be the customer interface with the Navy and Marine Corps for all Austal USA programs. Ryder comes to Austal from General Dynamics, Advanced Information Systems (GD-AIS) where he worked on both the LCS and JHSV programs.

BR ADLE Y K ERR has been named the new Sales and Marketing representative for Detyens Shipyards. He previously worked with Enman & Associates as the Director of Sales at Det yens Shipyards facility. In his new, full time role with the yard, Kerr will continue to suppor t the existing international agency network as well as develop new international markets and help facilitate domestic sales and marketing.

W i s co n sin - b a s e d Fai r b a nk s M o r s e Engine has named RHET T MERRIMAN sales manager for Marine Power Systems.

Merriman, who is a member of ASNE, the Navy League of the United States and the Surface Navy Association, has a 36-year career within the indus tr y. He mos t recently served as Manager of Government Engine Sales.

The American Association of Por t Authorities’ (A APA) Board of Directors has elected KRISTIN DECAS—CEO and Port Director of the Por t of Hueneme, California—as its incoming chair for AAPA’s 2014-2015 activity year. Decas will take on the role in November, at the conclusion of the Association’s convention in Houston, TX. JA SON BUNDOFF has joined Alan C. McClure Associates, Houston, TX, as a Naval Architect.

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EXPANDED PORTFOLIO catches Marco Polo’s eye MACGREGOR, PART OF CARGOTEC, will supply deck equipment to two 76m, 9,000 kW anchor handling tug supply (AHTS) vessels with bollard pulls of 150 tonnes.

The vessels are being constructed for Marco Polo Marine, Singapore, by its wholly owned subsidiary Marco Polo Shipyard PTE Ltd., Indonesia.

MacGregor will supply each ship with a high-pressure windlass/mooring winch, tugger winches, capstans, storage reels, hydraulic power packs and a telescopic provision crane. Additionally, each AHTS will be equipped with a 300-tonne low pressure anchor handling/towing winch with a 400tonne brake holding capacity, along with its hydraulic power pack.

The contract “represents an important milestone for MacGregor,” according to Francis Wong, MacGregor’s Vice President, Segment Sales, Offshore, since it demonstrates “the advantages we now can offer to our customers with our expanded portfolio comprising

both MacGregor and Hatlapa products. The expanded product range provides customers with three different technologies to meet any particular requirement.

“The combination,” says Wong, “strengthens the company’s position in the deepwater anchor handling market.”

MacGregor will deliver the first shipset in the first half of 2015, with the second shipset to follow first half 2016. Both vessels will be delivered to Marco Polo Marine in 2016.

Marco Polo also has options for two additional AHTS vessels.

MacGregor also recently launched a new alert system to complement its Hatlapa and Porsgrunn range of steering gear.

Named Soteria, after the Greek Goddess of Safety, the system works by providing the operator with both visual and audio warnings when a steering problem occurs.

MacGregor says the required alerts for each pump can be suited to a vessel’s specific steering gear configuration. macgregor.com

CAT OPENS UP order board for EPA certified Tier 4 engine CATERPILLAR MARINE has opened the order board for its U.S. EPA Tier 4 certified CAT 3516C engine. The auxiliary and diesel-electric propulsion (DEP) power solution is also IMO Tier II certified and IMO Tier III compliant.

Ideal for customers in the tug, salvage and offshore industries, the 3516C is available in a “B” rating of 2,240 bKW at 1,800 rev/min and a “C” rating of 2,350 bKW at 1,800 rev/min.

“The Cat 3516C Tier 4 certified solutions offer vessel owners enhanced vessel integration options, serviceability and the lowest cost of ownership,” says Jason

Spear, Caterpillar Marine Product Definition Engineer. “The 3500 engine platform has developed an incredible reputation in the commercial marine industry as a rugged and reliable powerhorse.”

The technology combines an after treatment system with an optimized engine to meet low NOx regulations. It also uses the Cat Clean Emissions Module incorporating selective catalyst reduction (SCR) technology. The efficient SCR system enables the customer to leverage shared components as well as a similar engine footprint to EPA Tier II and Tier III engines. marine.cat.com

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CONTRACTS SHIPYARD CONTRACTS While every care has been taken to present the most accurate information, our survey gathering system is far from perfect. We welcome your input. Please e-mail any changes to: marinelog@sbpub.com. Some contract values and contract completion dates are estimated. Information based on data as of about July 1, 2014. (*) Asterisk indicates first in series delivered. A “C” after a vessel type indicates a major conversion, overhaul or refit. Additional commercial and government contracts are listed on our website, www.marinelog.com.

SHIPYARD

LOCATION

QTY

TYPE

PARTICULARS

OWNER/OPERATOR

EST. $ MIL

EST. DEL.

$255.0

2017 2015

RECENT CONTRACTS Bollinger Shipyards Burger Boat Company

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6 1

FRCs excursion boat

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U.S. Coast Guard Wendella Sightseeing

Eastern Shipbuilding Vigor Fab

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MPFSV fireboat

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Harvey Gulf International San Francisco Fire Dept.

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Bollinger Shipyards Horizon Shipbuilding

Lockport, LA Bayou LaBatre, AL

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ocean tug towboat

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Crowley Maritime Canal Barge Co.

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U.S. Navy Norton Sound EDC

New Generation PENDING CONTRACTS

Houma, LA

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pushboat

72 ft x 30 ft, 2,000 hp

Blessey Marine

Aker Philadelphia BAE Systems Southeast

Philadelphia, PA Mobile, AL

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50,000 dwt 7,700 ft3

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Seabulk Tankers Inc. Otto Candies LLC

Option Option

Gulf Coast Shipyard Leevac Shipyards

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PSVs PSVs

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Harvey Gulf Intl. Marine Tidewater

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TBD TBD

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Offshore Patrol Cutters convert steam to LNG

U.S. Coast Guard Horizon Lines

RFP/Phase I RFP

TBD TBD

1 6

double-end ferry car ferries

70-car 1,200 PAX (convert to LNG)

VDOT Washington State Ferries

$27

RFP RFP issued

3 1

double-end ferries 4,500 PAX Roll-On/Roll-Off 692 ft, 26,600 dwt

NYCDOT Pasha Hawaii Transport

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JUL14 JUL14 SEP14 NOTES

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533633 I HMC2014 – SMM – Anzeige I Motiv: Offshore I Datei: HMC_533633_SMM_AZ_Offshore_203x133 I 4c Euroskala, Offset I Format: 203 x 133 mm I 36 MARINE LOG August

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Open Positions: General Manager – Brooklyn, NY Port Captain – Seattle, WA Port Engineer – Seattle, WA and Brooklyn, NY Port Mechanic – Seattle, WA; Alameda, CA; U.S. Gulf Coast and Brooklyn, NY ATB Captain – West Coast ATB Mate – West Coast Pilot – U.S. Gulf Coast Tankerman – U.S. Gulf Coast and Seattle, WA For a list of all open positions or to apply online, please visit our Careers page at www.harleymarine.com

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EXAMPLES OF TYPICAL TASKS: Manage day to day below deck operations and assist in daily operations of the Ferry Operations unit. Maintain engine department operations, crewing schedules and vessels within the framework of a Safety Management System. Supervise engine department personnel and staffing on a 24-hour-a-day basis. Supervise all aspects of budget management, including but not limited to such tasks as approving labor, materials, supplies, equipment and parts within vessel engine department operating budgets. Evaluate routine engine department work orders, store requests and labor expenditures to assure they comply with budgetary constraints. Manage vessel regulatory compliance. Oversee fuel facility operations. Serve as technical advisor to the Chief Operating Officer for marine engineering matters. May perform as contract/project manager for unit procurements and activities. May represent the Staten Island Ferry at internal and external meetings, when appropriate. In absence of supervisor, may assume duties Director of Ferry Operations.

Minimum Qualification Requirements 1. A baccalaureate degree from an accredited college in engineering, architecture, landscape architecture, business administration, or public administration, and five years of full-time satisfactory experience in the planning, administering or expediting of engineering design, and/or construction, or coordinating a very large engineering project, two years of which must have been in an administrative, managerial, executive or supervisory capacity; or 2. A four year high school diploma or its educational equivalent and nine years of experience as described in "1" above; two years of which must have been in an administrative, managerial, executive or supervisory capacity; or 3. Education and/or experience equivalent to "1" or "2" above. An accredited Master's degree in one of the disciplines described in "1" above, a law degree, or a valid New York State license as a Professional Engineer or Registered Architect or Landscape Architect may be substituted for one year of the required experience. However, all candidates must have the two years of the administrative, managerial, executive or supervisory experience as described in "1" above.

Preferred Skills 1. Strong background in all aspects of maritime management including operations, maintenance and repair, personnel management and regulatory issues.

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LICENSE REQUIREMENT: Possession of a valid U.S. Coast Guard Merchant Mariner Credential, with endorsement as Chief Engineer of Motor Vessels of Any Horsepower.

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INDEX OF ADVERTISERS COMPANY

PAGE #

COMPANY

PAGE #

ABS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Karl Senner LLC . . . . . . . . . . . . . . . . . . . . . . . . . .C4

American Vulkan Corporation . . . . . . . . . . . . . .S6

MAN B&W Diesel A/S . . . . . . . . . . . . . . . . . . . . . . 3

Bland & Partners P.L.L.C . . . . . . . . . . . . . . . . . . . 2

Marine Art of J Clary . . . . . . . . . . . . . . . . . . . . . . . 4

Blank Rome LLP . . . . . . . . . . . . . . . . . . . . . . . . .S2

Noble Denton Marine Assurance and Advisory 24

Class NK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

Omnithruster Inc . . . . . . . . . . . . . . . . . . . . . . . . 12

Continental Underwriters LTD . . . . . . . . . . . . . .26

Pivotal LNG/AGL Resources . . . . . . . . . . . . . . . . 19

Cummins Generator Technologies. . . . . . . . . .SC4

Rapp Hydema . . . . . . . . . . . . . . . . . . . . . . . . . . .C3

Deutsche Messe (SMM Hamburg Messe) . . . . .36

Rolls Royce Marine . . . . . . . . . . . . . . . . . . . . . . . 23

DNV-GL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S5

Scania USA Inc . . . . . . . . . . . . . . . . . . . . . . . . . .S8

ExxonMobil Global Fuels & Lubes . . . . . . . . . . .C2

Scienco/Fast . . . . . . . . . . . . . . . . . . . . . . . . . . . .S3

Great American Insurance Co . . . . . . . . . . . . . . 13

Sea Tow Services International . . . . . . . . . . . . .22

Hornbeck Offshore . . . . . . . . . . . . . . . . . . . . . . . . 7

SNAME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

IMO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

W&O . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .S4

International Workboat Show . . . . . . . . . . . . . .28

WQIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Japan Radio Co Ltd(JRC) . . . . . . . . . . . . . . . . . . . 35 August 2014 MARINE LOG 39

SHIPBUILDING HISTORY

ESCORT CARRIERS

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ships were retained and commissioned in the U.S. Navy. (Eleven seems to be a magic number in the world of aircraft carriers.)

A second batch followed, designated the Casablanca class. This time, the design chosen was slightly larger, a modification of the Maritime Commission’s C4 cargo ship, labelled the S4-S2-BB5 and 50 were built, all by the Kaiser yard in Vancouver, Washington: they were delivered at the rate of roughly one a week, from July 1943 thru July 1944. The Casablanca-class ships were over 500 feet long, had a service speed of 20 knots and carried around 28 planes. All were commissioned into the U.S. Navy.

Following the Casablanca class was the Commencement Bay class and this represented a major step forward, in that these ships were ordered as CVEs, not ordered as merchant ships and then designated

The USS Windham Bay was part of the Casablanca class of escort carriers

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40 MARINE LOG August 2014

CVEs. The design was based on the Maritime Commission’s T-3 tanker, giving them a length of over 557 feet by 75 feet beam, a service speed of 19 knots and a payload of 34 planes. Although 33 were ordered, only 19 were built, all by Todd Tacoma, the balance being cancelled when the war ended.

Including the early conversions and the ships transferred to Britain, 122 escort carriers were built. They were relatively vulnerable ships and six were lost. Most of them were scrapped in the 1960s, although some of those transferred to Britain and some of the Commencement Bay class continued in service into the 1970s. Sadly, none survive today: the last to be scrapped was one of the first to be built, the former USS Barnes, (CVE 6), which had a second career as the cruise ship Fairsky and was in service until 1980.

U.S. Navy National Museum of Naval Aviation

WHEN WWII STARTED IN EUROPE, the U.S. Navy had six aircraft carriers in service and two—the future Wasp and Hornet—under construction. A year later, 11 more had been ordered and another 11 were planned for the following fiscal year. But the active fleet still only numbered eight carriers and it was clear that the build-up of the carrier fleet was not going rapidly enough to meet the Navy’s needs. Carriers were large complex ships which took a long time to build and some kind of smaller, simpler carrier was going to be needed that could take up the slack until the big ships started to arrive. The solution to this problem was the escort carrier (CVE). Escort carriers would primarily be employed to escort convoys but, as more of them joined the fleet, they were also used in other roles, such as providing air support for amphibious operations and transporting replacement planes.

After experimenting with a couple of conversions, the design that the Navy settled on for this new type of ship was a modification of the Maritime Commission’s C3-S-A2 cargo ship, and 45 of these were ordered.

Todd Tacoma built the bulk of this fleet—37 ships—with Ingalls and Western Pipe & Steel each building four. Collectively, they were designated the Bogue class. They were less than half the size of a regular carrier—a bit less than 500 feet long by 72 feet beam, with a service speed of 18 knots and the ability to carry 20 to 25 planes. The bulk of them, 34 ships, went straight to the Royal Navy: they were modified for British service by Burrard Dry Dock, in Vancouver, BC. The other 11

By Tim Colton

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