MarEx 22 by Maritime Executive Magazine

October 2007

Mitags/pmi Maritime Institute of Technology and Graduate Studies/Pacific Maritime Institute (From Left):

John Scragg, Director of Training – PMI Glen Paine, Executive Director – MITAGS/PMI Walter Megonigal, Director of Training – MITAGS Gregg Trunnell, Director – PMI Robert Becker, Business Development Manager – MITAGS

The simple fact is:

The Dutch are world leaders in engineering and managing complex shipbuilding projects. The simple question is:

How do they do it? This is the worldâ&#x20AC;&#x2122;s leading trade fair for advanced maritime technology. We put the shipbuilding industry in a global perspective.

Find the answer at:

THIS is the future... Welcome aboard

6 - 9 November 2007 Ahoy Rotterdam www.europortmaritime.com

contents 10.07

MITAGS Simulator

Case Study • MITAGS/PMI

New Standards for Maritime Training by Joseph Keefe

Executive Interview

MarEx Ventures Out Onto the Cutting Edge of Maritime Technical Training – and More…

Editorial A Good Time to Catch a Ship… by Joseph Keefe

Bourbon Interview

Measuring Up in the Face of Tragedy by Marex Staff

Executive Achievement

- Robert P. Hill, Founder, Ocean Tug & Barge Engineering Corporation

Deferred Compensation

Retirement Planning in Restricted Waters by W. Richard Webster

by MarEx Staff

by Joseph Keefe

Washington Insider

Maritime Training

Troubled Waters for the “Fun Ships”

Tradition, Innovation and Technology

by Larry kiern

by MarEx Staff

Directory Listings (page 50)

Ship Finance The Elephant in the Room by John Benoit

Life and Death When Things Go Terribly Wrong

Broadband at Sea A New Era in Communications

by MarEx Staff

by Joseph Keefe

the maritime executive

editorial staff

editor in chief Tony Munoz tonymunoz@maritime-executive.com managing editor Joseph A. Keefe jkeefe@maritime-executive.com senior copy editor John J. Oâ&#x20AC;&#x2122;Connell, Jr. harvardjo@maritime-executive.com copy editor Valerie K. Leichtman vleichtman@maritime-executive.com senior vice president sales & marketing Brett Keil bkeil@maritime-executive.com art director Daniel Bastien dbastien@maritime-executive.com internet services manager Matthew Miller matt@maritime-executive.com sales administrator Elizabeth Cash elizabeth@maritime-executive.com sales associate - Germanic Europe Hansjorg Brans jbrans@maritime-executive.com sales associate - India, Asia & Middle East Raghu Menon raghu@maritime-executive.com sales associate - Eastern Europe Maciej Wedzinski maciej@maritime-executive.com published by TM Marketing Group, LLC The Maritime Executive, LLC (ISSN 1096-2751) 3200 S. Andrews Avenue, Ste. 100 Fort Lauderdale, FL 33316 Telephone: (866) 884-9034 Fax: (954) 848-9948 www.maritime-executive.com For subscriptions please visit www.maritime-executive.com.

4 the maritime executive

editorial A Good Time to Catch a Ship…

he title of this editorial says it all: It IS a good time to go to sea. In fact, there may have never been a better time to be employed on any marine platform, for any purpose. Merchant mariners, offshore seismic employees, commercial diving and salvage specialists and any number of other disciplines are clearly enjoying the benefits of being involved in one of the most demanding industries the world has ever known. That’s the good news. The bad news is that there just aren’t enough mariners to go around. A global boom in shipbuilding and a growing thirst for LNG – and every other kind of energy, for that matter – is fueling the best job market for mariners in more than sixty years. And this time, and unlike their counterparts from the 1940s, these professionals are not going to sea and looking for the inevitable torpedo as they do. Instead, they choose from an array of modern and comfortable work platforms, pay scales unthinkable just a decade ago and amenities such as wireless Internet and low-cost, ship-to-shore telephone services. As I write about such things, it is quite frankly almost enough to make me want to rethink my decision to come ashore in late 1985. Shipping has changed immeasurably since I last signed onto a merchant vessel. Technology finally caught up with the growing economies of scale presented by bigger and bigger commercial vessels. It is no longer enough to be a good seafarer, and today’s mariners boast a technical sophistication that is truly remarkable. Nowhere is this more apparent than in the so-called brown water, lower tonnage sectors of the market, where the high-tech demands of the job often exceed that expected of their blue water contemporaries. These pressures also bring new requirements in the form of training, which must necessarily incorporate new ways of teaching, new technologies and, more importantly, renewed efforts to bring new mariners into the business and keep the ones already there. In this issue of MarEx, you will read, among other exciting topics, about how industry has responded to the growing manpower shortage crisis. This takes the form of innovative training methods and expanded amenities designed to keep seafarers where they belong: at sea. It also involves creating pathways – the reopening of the hawse pipe, for example – for individuals who might not otherwise get the chance to not only go to sea, but also to advance to the highest level mariner that they are capable of being. As with most worthwhile things in a market economy, these initiatives are borne and furthered by the business community at large. That’s the way it should be. I haven’t really been honest with you, though. I didn’t choose to come ashore; I got laid off when they sent my chemical tanker to the breaking yard. And the prospects of finding another ship just didn’t seem real good. The truth of the matter is that a generation of mariners packed it in during the 1980s because they had nowhere else to go. On the other hand, had I known then what is transpiring now in the maritime world, somebody else might be writing this column. To today’s mariners, I say: Enjoy it while it lasts. It probably doesn’t get any better than this. Likewise, to their employers, I would tell them that today’s extraordinary efforts to find, train and keep qualified mariners need to continue, even into the next market downturn. The time will come when employers can once again choose from a plethora of qualified mariners vying for that one coveted position. The temptation to cut wages, benefits and training will be almost overwhelming. But in the face of that, I’m reminded of a bumper sticker that was quite prevalent back in the mid-1980s, when I lived in Houston. It read, quite simply: “Lord, please send me another oil boom – I promise not to screw it up this time.” Words of wisdom, I think. MarEx

Joseph Keefe

Managing Editor

Managing Editor Joseph Keefe can be contacted at jkeefe@maritime-executive.com with comments, input and questions on this editorial or any other piece in this magazine. The Maritime Executive welcomes your participation in our editorial content.

Distribution of The Maritime Executive:

Shipbuilders & repairers

15% Naval architects, lawyers, consultants, and insurers

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58%

Ship owners, operators, managers, charterers, and brokers

Other East Coast

Other

Western Europe

19% 36%

2% 26%

West Coast

29%

16% 14%

5% 2%

Government

Domestic Circulation:

Canada

Asia

13%

Marine equipment manufacturers

International Circulation:

Markets Served:

Scandinavia

7% South & Central America

28%

5% 3% Eastern Europe

Other (Africa, Australia, Misc. Island Nations)

Gulf Coast

15% Midwest

executive achievement

executiveachievement

By MarEx Staff

Robert P. Hill Robert P. Hill is Founder, President and Principal Naval Architect of Ocean Tug & Barge Engineering Corp. An internationally recognized naval architect with 35 years’ experience, his specialty practice is built around the design and development of AT/Bs, or “Articulated Tug/Barge” units. Mr. Hill is one of the noteworthy designers in this field, which has spawned a technological revolution

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in coastwise shipping. His involvement in this specialty dates back to 1980. His work has built on the great work done by such noteworthy naval architects as Edwin Fletcher and Takeo Yamaguchi – both early pioneers in the pinned AT/B field. He founded his present firm, Ocean Tug & Barge Engineering Corp., in 1993 to allow him to devote all his energies to this field of engineering. Since its inception, Hill’s firm has been involved in the engineering or design of over 55% of the AT/Bs built, or refit, in the United States. As Principal Naval Architect of his firm, he personally generates all of the major design and engineering concept drawings required to construct both large, high-horsepower seagoing tugs and their cargo counterparts – large, seagoing bulk, container, chemical and petroleum barges. His primary function remains being a designer. Under Hill’s oversight, the firm has designed tug/barge units as large as 70,000 tons capacity for operation on sea routes worldwide. He remains to this day an active, practicing professional naval architect and marine engineer. Hill recently told MarEx, “We have been privileged to participate in dozens of AT/B designs. Our design work is not simply ‘theory.’ It is based on actual operating experience of the AT/Bs we’ve designed or converted. We don’t simply rely on customer feedback—we actually ride our units. So what you get from us is not only the theoretical and engineering expertise; you also get PRACTICAL experience. Put simply, our boats work.” Hill has virtually done it all. He has overseen the conversion of existing vessels to AT/Bs and designed new ones, while working with all the major AT/B connec-

tion systems. He encourages and receives regular feedback from the boats he has designed, and his work includes the first 70,000-ton, shuttle-tanker AT/B. Hill’s client list is a “Who’s Who” of the marine industry—and it is expanding every day. Today, OT&BE continues to provide innovation to the marine industry and is now introducing a unique AT/B application for the offshore industry as well as expanding R&D work into container feeder AT/Bs and both chemical and LNG carrier AT/Bs. Hill’s designs are tailored to the client’s operation and include ergonomic features to provide extended service life, ease of maintenance, and maximum performance and safety. Hill says, “Tugs and barges are our true specialty, not a sideline. So everything we do is geared toward this part of the marine transportation world. We’re not here in this design specialty just because this is the hot trend now. We’ll be here doing this sort of work for a very long time.” Hill is directly responsible for many “firsts” in the AT/B technology sector. He is the inventor and co-patentee of the “Intercon” tug/ barge connection system, manufactured by Intercontinental Engineering/Manufacturing Corp. of Kansas City, MO. This system is used to mechanically connect large tugs and barges for operation at sea and is the most extensively applied system for large AT/Bs in the world. Hill continues to design and modify vessels in-house with this system, and he serves as a naval architecture advisor to Intercontinental for applications engineered by others. The firm’s client list includes major oil companies, large shipping companies, regulatory bodies and companies engaged in the shipment of products they manufacture. Hill

executive achievement acts as a consultant as well as a naval architect/marine engineer, providing advice to clients on matters of transportation economics, shipyard production issues, Owner’s Representation in shipyards, regulatory compliance and the advancement of innovative ideas in coastal and ocean shipping. Hill is the author of numerous technical papers related to AT/B design. A member of the Society of Naval Architects & Marine Engineers, he has presented papers at both the New England and Philadelphia sections of the Society. He has also presented papers on AT/B design and economics at the International Workboat Show and the Ship Construction Symposium. He was a featured speaker and paper presenter at the prestigious International Tug & Salvage Convention. Hill sits on the American Bureau of Shipping’s Committee on Rules for 90M Vessels, which annually formulates policy, technical rules and standards used to guide the design and construction of vessels built to the

Bureau’s specifications. He has also advised the U.S. Coast Guard on matters related to tug/ barge design and was involved in the original creation of NVIC-2-81, the Coast Guard Guidance on tug/barge unit regulations. Hill notes the contribution of so many others to his success – designers like Mr. Yamaguchi, who has shared his knowledge, the late Merritt Demarest, Mr. Joe Hack, the late Mr. Larry Hoeffler, the late Mr. Bart Turecamo, and the man who taught him so much about boat

design and doing it “right,” Mr. John W. Gilbert, for whom Hill worked for over 20 years. “All of these folks and dozens of others, as well as all of my clients and their operations and management people – and especially the crews aboard tugs I have spent time visiting dating back to my youth - have a hand in having helped me along and taught me. Where I fall short is where the likes of these men have not been there to teach me.” MarEx

the maritime executive

washington insider

Troubled Waters for the “Fun Ships” by Larry Kiern, Winston & Strawn LLP While the Administration remains largely preoccupied with the challenges in Iraq and Afghanistan and the global war on terror, Congress has been shining its light on important domestic matters warranting public attention. In the maritime arena, this column has previously reported on the controversy surrounding the Coast Guard’s Deepwater Program, complaints about the Coast Guard’s performance of its marine safety functions, and the lack of leadership by the Administration in the area of environmental regulation, specifically air emissions and operational discharges from vessels. Another important subject, which has suffered from lack of Administration leadership, is the continuing serious threat to the security and safety of millions of American citizens vacationing on cruise ships departing America’s ports. Despite the urgency of the danger and the ease with which meaningful improvements could be accomplished, the Administration has been noticeably missing in action. Leadership is supposed to be principally an executive branch function, but once again this Administration has failed to lead on an important domestic issue and in doing so has left a political vacuum for Congress to fill.

Congressional Testimony Shines Light on Troubled Waters In January 2007, the Los Angeles Times published an article disclosing sexual assault data provided by Royal Caribbean International as part of a civil lawsuit. The article reported startling data that in a short period of only 32 months Royal Caribbean reported over 250 incidents of sexual assault, battery, harassment, etc. In March and September of 2007, Congress conducted hearings about crime and other dangers faced by American citizens 10 the maritime executive

on these ships. As a result of the shocking testimony from those hearings, Senator John Kerry of Massachusetts and Representative Doris Matsui of California announced a legislative measure to compel more accurate reports of cruise ship crime and to mandate standards for the collection of evidence of crime on cruise ships. Senator Kerry declared that “Voluntary steps are not enough.” Representative Matsui’s resolution expressing the sense of the Congress that American citizens should be protected from crime on cruise ships immediately garnered 31 co-sponsors.

Over Ten Million Annually at Risk on Cruises From America The simple facts are that, every year, cruise companies carry about 10.6 million American citizens on ships that depart from and return to America’s ports, almost five million from Florida ports alone. Large cruise conglomerates, such as Carnival Corporation, Royal Caribbean and Star Cruises (corporate parent of Norwegian Cruise Line), profit handsomely from this lucrative vacation business targeted directly and principally at the American market. They celebrate their cruises with labels such as “Fun Ships” and “Freestyling” and promise to deliver the “Wow.” Cruise companies pour millions of dollars into aggressive advertising and marketing campaigns in the United States. Indeed, one can hardly open a newspaper or view an evening of television without being told that cruises promise you and your family a safe and enjoyable escape from the rigors of work and burdens of everyday life. These media campaigns actively promote a sense of safety, security, romance, and carefree enjoyment and urge us to trust them and purchase a cruise vacation. But the advertisements don’t tell the whole story.

Cruise Industry Cover-Up Seeks to Avoid Liability Simultaneously, however, the cruise industry actively seeks to conceal the real dangers to American passengers lurking on its ships because of its longstanding and chronic failure to take basic security precautions to protect the very same passengers it lures into a false sense of security The evidence shows that the risks presented on these ships are real and particularly disturbing because of the high incidence of sexual crimes. Cruise companies have paid millions of dollars to settle civil lawsuits filed in U.S. courts for failing to protect their passengers. For example, in 2004 a Royal Caribbean cruise line, Celebrity Cruises, was adjudged legally responsible for the rape of a passenger by one of its crew and ordered to pay one million dollars in damages. Such publicly reported results of lawsuits are relatively rare because cruise companies pay large sums to settle claims with confidentiality agreements to conceal both the details of the crimes and the payments made to silence the victims. Nevertheless, accounts available on the Internet published by law firms representing victims show that the cruise industry has settled other cases for more than the one million-dollar judgment rendered against Celebrity. Recently, congressional testimony by victims of sexual assault on cruise ships and their advocates shed a brighter light on facts that the cruise industry actively seeks to conceal. The testimony riveted audiences attending the hearings and viewing it on the Internet. Most disturbing to those who witnessed the hearings was the graphic testimony of victims and their advocates about brutal sexual assaults by crew members on female passengers. The evidence offered also showed that the cruise company involved first discounted the serious-

washington insider ness of the crimes while quickly seeking to cover up the crimes and blame the victims for crimes committed by their own employees. Fearful of their own liability, it appears that cruise companies, which are strictly responsible for the safety of their passengers, put their own bottom lines first. Simply put, these crimes and other incidents and their mishandling by cruise company management show that cruise companies cannot be trusted to act in the interests of their passengers. Such callous disregard for passenger welfare warrants congressional intervention in an industry that has long demonstrated its failure to perform such basic functions in a responsible manner.

Failure to Take Basic Safety Precautions Despite reassuring words from industry representatives designed to both minimize the danger and marginalize the victims, the industry’s actual response has been to recklessly refuse to take basic steps to avoid and remedy the dangers presented to its passengers. For example, the industry has known about the dangers presented by predator crewmen for many years but has still failed to take adequate protective measures. A report prepared for Royal Caribbean as early as 1999 identified the seriousness and widespread nature of the problem, including the fact that such crimes are “unreported and/or unpublished.” The Federal Bureau of Investigation (FBI) testified to Congress that over half of cruise ship crimes reported to it are sexual assaults and that in almost 40 percent of those crimes the suspects were cruise company employees. The testimony to Congress established that cruise companies have failed to take essential measures to ensure the safety and security of passengers. Moreover, some of these measures are so simple and inexpensive that they were adopted by the hotel industry many years ago. In the year 2007, it boggles the mind to learn that cruise ships calling in the United States are still not equipped with these basic safety and security features. For example, cruise ships still lack inexpensive and easy-to-install peep holes on passenger cabin doors to allow passengers to see who is knocking on the door before opening it. In shocking testimony to Congress, we

learned that cruise ships calling in the United States and carrying American citizens still fail to control the abuse of pass keys by crew. Therefore, as a practical matter, cruise company personnel enjoy access to passenger staterooms at all hours. In 2003, a Carnival Cruise Line employee was charged in Florida with sexual battery and burglary after he reportedly used his pass key to enter a cabin and rape a sleeping passenger. Yet the testimony to Congress reported that as recently as March of this year a cabin steward on a Royal Caribbean ship used his pass key to enter a college coed’s stateroom late at night after she had fallen asleep and rape her. Moreover, the testimony showed that the cruise company failed to exercise appropriate control and supervision over the crew member’s use of the pass

to the cruise company than protecting itself from the risk of damages awarded in a lawsuit.

Communications and Political Strategies to Block Reform Sadly, rather than taking more meaningful steps more quickly to protect its passengers, the industry has adopted communications and political strategies designed to forestall reform by (1) arguing in essence that the United States really can’t do anything about it because the ships where the crimes occur are foreign territory, and (2) denying the problem is really very serious by comparing the data to crime in American cities. Both arguments are misleading. The industry has argued that its ships are overwhelmingly registered under foreign flags and, therefore, every time an American passenger sets foot on a cruise ship in an American port the passenger is setting foot on a piece of foreign territory outside the jurisdiction of the United States. This message has been parroted by political supporters of the industry for many years to suggest that there is little that the United States can really do to protect its citizens. It aims to deflect attention from the seriousness of the crimes and frustrate potential reform measures by arguing that this is really not a matter for the United States to solve because it lacks jurisdiction. This communications and political strategy is deceptive. The Supreme Court plainly ruled over two years ago that Congress could enact legislation to protect American citizens on foreign-flag cruise ships calling on ports in the United States. In Spector v. Norwegian Cruise Line, 545 U.S. 119 (2005), the Supreme Court upheld the legality of the Americans With Disabilities Act as applied to foreign-flag cruise ships. And in doing so, its ruling was consistent with a long line of earlier decisions to the same effect. Moreover, these cruise conglomerates maintain their headquarters in the United States. Carnival Corporation, the largest with $12 billion in annual revenue; Royal Caribbean, the second largest with over $5.5 billion, and Norwegian Cruise Line with $2.5 billion are all headquartered in Miami. Simply put, as a matter of law, there is no question that these multi-billion-dollar conglomer-

While Royal Caribbean’s spokesman told Congress that “Nothing is more important than the safety of our guests,” the testimony of victims and their advocates regarding these shocking crimes shows that nothing is more important to the cruise company than protecting itself from the risk of damages awarded in a lawsuit. key to sneak into the young woman’s room. Further compounding the crime, the cruise company not only failed to provide proper medical care to the rape victim but also affirmatively misled the victim into believing the medical staff acted in her interest when they secretly really functioned as part of the company’s risk management team. While the company’s medical staff failed to administer proper medication to prevent HIV infection, they did manage to find a way to administer a powerful sedative. Then, remarkably, they sought to obtain a risk-management statement from the victim while she was sedated. The company also isolated the rape victim for hours on the ship and refused to allow the young traumatized woman to call her parents. The shocking testimony of victims and their advocates before Congress highlights the real conduct of the cruise company toward its passengers. Having failed at the outset to provide the most basic security protection, the cruise company moved swiftly to protect its own bottom line from potential liability. While Royal Caribbean’s spokesman told Congress that “Nothing is more important than the safety of our guests,” the testimony of victims and their advocates regarding these shocking crimes shows that nothing is more important

the maritime executive

washington insider ates avail themselves of the United States for their pecuniary interests. They aggressively play American ports against one another for cruise business and seek and receive subsidies from them to operate. They actively advertise in the United States in order to solicit millions of American citizens to take cruises embarking from U.S. ports. American passengers purchase their cruise tickets in the United States, and those tickets provide for jurisdiction of legal disputes in the United States. Thus, as a matter of law, there is simply no doubt that the cruise companies that own, operate and control these vessels registered under foreign flags of convenience are subject to the jurisdiction of the United States. The mere registry of their ships under foreign flags of convenience – to avoid American taxes and labor laws and hire crews from underdeveloped third-world nations at wages much lower than Americans are paid – is of no consequence to the legal authority of the United States to assert jurisdiction. The United States has repeatedly led the world maritime community by improving safety and environmental protection standards for decades through the adoption of unilateral legislative and regulatory provisions mandating safety, security and environmental improvements on vessels calling in the United States. Indeed, if it were not for the unilateral actions of the United States over the last fifty years, the world’s cruise passengers would be in far greater danger today and the industry would not be so profitable. While the cruise industry trumpets what it characterizes as its overall record of safety, improvements have occurred under the stern and watchful eye of U.S. legislators and regulators, e.g., the U.S. Coast Guard. Just as the United States did more recently in the area of pollution prevention, unilateral legislation – like the Federal Water Pollution Control Act, the Ports and Waterways Safety Act, and the Oil Pollution Act of 1990 – is a proven way to force improvements on this reluctant industry. If the U.S.-based conglomerates that own and operate foreign-flag passenger vessels want access to the lucrative market of millions of vacationers in the United States, they can and should be required to implement proper safety and security improvements immediately. There is simply no excuse for continued

cover-ups and foot-dragging. In a second and related deception, the industry’s communications strategy seeks to minimize the seriousness of the problem. According to one industry spokesman, a person on a cruise is “many times safer than a person on land.” First, the industry and its political allies repeatedly refer to the total number of passengers and crew on ships over the course of a year to minimize the number of crimes occurring on those ships. Second, it compares the number of crimes occurring on its ships to the FBI’s general crime rate statistics for the United States. But such tactics mislead. As Royal Caribbean’s own 1999 study warned, these sexual assault crimes are often “unreported.” And as testimony before

expectation that they are going to be subjected to the risks of inner city crime. So statistics that are influenced by those higher crime rates are inappropriate for comparison. Instead, a more appropriate comparison of the incidence of crime would be for the cruise industry to compare its experience and its lack of safeguards to comparably priced vacation resorts in the United States. After all, that is the vacation niche with which the cruise industry is really competing. Importantly, as we have seen, that comparison shows that the cruise industry has failed to take basic security measures to protect its passengers. With respect to the incidence of crime, the industry failed to provide Congress data or analysis showing a comparison of its crime statistics to that of American resorts of comparable price. For example, how do the crime and sexual assault data of Carnival, Royal Caribbean and Norwegian compare to Marriott, Hilton and Hyatt resorts?

These media campaigns actively promote a sense of safety, security, romance, and carefree enjoyment and urge us to trust them and purchase a cruise vacation. But the advertisements don’t tell the whole story.

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Congress showed, the industry’s statements about the comparative safety of its ships is deceptive. Indeed, detailed written testimony to Congress by industry critic Dr. Ross Klein, submitted in March 2007, showed that cruise ships presented a 50 percent greater chance of sexual assault compared to the United States generally, not a lesser chance. Although congressional hearings afforded the industry ample opportunity to rebut Dr. Klein’s findings, the industry has not. Moreover, in order for any comparison to be meaningful, it should be made to a truly comparable population. For example, those of us living in the quiet suburbs or small towns of America would not be happy to learn that our own communities were experiencing crime levels that were consistent with the general crime rate in the United States, which is influenced by higher rates of urban crime. As Dr. Klein pointed out in his critique of the industry’s characterization of the data, the industry compares its performance to crime rates in large cities rather than small communities with much lower incidents of crime. While the cruise industry likes to compare itself to the general crime rate to minimize its crime problem, cruise ships hardly represent general American urban society, where most crime is reported. Nor, for that matter, do passengers pay for their cruise vacations with the

Conclusion While the cruise industry works aggressively to conceal its dirty secrets to avoid liability and the Administration remains suspiciously silent on the sidelines, Congress has shown a willingness to shine the light of day on an industry in deep denial. This illumination deserves continuing support from all of us who may purchase cruise vacations or who have family members who may take cruises in the future. This is not an academic issue – it is a real-life issue that affects the safety and security of ourselves and our loved ones. Simply put, safety from crime is too important a matter to be left to the management of the very companies that have proven over many years that they are reluctant to take effective steps. MarEx Larry Kiern is a partner at Winston & Strawn LLP, an international law firm of 900 lawyers. His practice concentrates on maritime issues, including legislative, regulatory, and litigation matters. Before joining Winston & Strawn, he was a Captain and law specialist in the U.S. Coast Guard who served as the Legislative Counsel and Deputy Chief of the Coast Guard’s Congressional Affairs Office.

difference life and death

When Things Go Terribly Wrong

The Difference Between Life and Death for Marine Pilots by Joseph Keefe

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difference life and death Sobering Statistics In January of 2006, a veteran harbor pilot died in Hawaii when he fell from a ladder after piloting a cruise ship out of the harbor. After falling in the water, he was hit by the pilot boat. In the same month, a Columbia River Bar Pilot lost his life on the job when he tried to disembark from a log carrier he had finished guiding during a storm. As he attempted to make the leap to a smaller shuttle boat that would return him to land, he went overboard and drowned. His body was finally recovered almost two days later. The Columbia River case is now mired in litigation. In February of this year, a Chesapeake Federal Pilot fell as he attempted to board a U.S.-flagged tanker on a cold, icy winter evening. Another accident this year, involving a Texas-based pilot boat carrying two pilots back from an assignment in the U.S. Gulf, resulted in the drowning death of one individual. While returning from a Gibraltar-flagged research vessel, the pilot boat ran into trouble, and another pilot boat in the area sent a Mayday call. The U.S. Coast Guard (USCG) responded and was able to rescue one pilot in rough waters just south of the Galveston Jetties. The body of the other pilot was later located and recovered by a commercial dive team about three miles south of the Galgeveston Jetties. Both pilots were affiliated with the Texas City-Galveston Pilots Association. There was no immediate reason given for the capsizing of the 1983-built, 57-foot pilot boat. In Boston, another pilot lost his life recently in a non-seagoing accident while his vessel was still alongside the pier. All of these incidents underscore the dangerous nature of the job, as well as the need to ramp up search-and-rescue capabilities while regularly performing local audits to ensure that responsible persons remain competent at these important tasks. Aside from the Boston incident, they all involved a man overboard and an unsuccessful attempt to rescue at least one individual. We will, in all probability, never know if one or all of the victims

of these accidents could have been saved with a more competent and vigorous response. Sadly, however, search-and-rescue is a skill which many organizations pay lip service to but few truly embrace with concrete action. It doesn’t have to be that way.

U.S. Marine Pilots: Supremely Skilled and Well-Compensated – So, Where Is the Problem? The job of marine pilot is arguably the most coveted position in the world for professional mariners, and especially for deck officers who continually work with them. And why not? In most places, pilots are the highest paid workers on the waterfront with pay scales that can rival a shipping company CEO’s compensation. But pilots say they are worth the pay, given what is at stake as ships worth millions of dollars transport cargoes valued at hundreds of millions through congested waterways, narrow channels and treacherous tides. It is hard to argue with them. The path to the “center window” in the wheelhouse is a long and arduous journey for most mariners, but the rewards for regularly guiding ships the length of four football fields safely to and from the berth are usually worth the effort. Though being a marine pilot usually means membership in a small, exclusive fraternity of men and women in a commercial region, it is common knowledge that pilots work under some of the most dangerous conditions known to man. In the past two years, no fewer than eight pilots – five right here in the U.S. – went to work and never returned. The fact that accidents occur in this highly industrial and weather-impacted business is not in itself news. On the other hand, some of these tragedies might have been averted had prior planning and rescue training for pilots been part of their basic curriculum. According to the American Pilots’ Association (APA), a national trade group of professional maritime pilots, there are approximately 60 groups of state-licensed pilots in the U.S., as well as the three groups of U.S.-registered pilots operating in the Great Lakes. There are also scores of federally licensed pilots (usually unaffiliated) guiding “enrolled tonnage” through the U.S. port systems. There are standards and regulations that govern pilotage in the U.S., and they are very stringent by design. The cold hard fact is it’s not easy to become a pilot, not only in terms of achieving the required skill sets, but also in simply making it through the selection process, which can be a monumental task in itself. In stark the maritime executive

difference life and death contrast, the regulatory pressure exerted by state and federal authorities to ensure adequate emergency response and rescue procedures for U.S. pilots, while well-defined, is arguably quite lax. However, the pilot safety issue is finally beginning to get a lot more attention, and not just in the U.S. According to the International Maritime Pilots’ Association (IMPA), “No fewer than eight pilots and IMPA members died in various incidents last year alone.” In addition, as reported in the January 2007 issue of the IMPA magazine, The International Pilot, the International Maritime Organization’s (IMO) Marine Safety Committee has approved a proposal to review the IMO requirements and standards for pilot ladders and other arrangements for pilot transfer. Captain Gregg Farmer of the Boston Pilots Association recently told MarEx that part of the problem can possibly be traced to the enforcement of IMO standards regarding the proper use of equipment and the deployment of equipment by ships. “Port State Control is the key. Pilot boarding ladders have to be in compliance and must be deployed correctly off vessels,” he said. Steve Wigely of Marine Rescue Consultants, LLC doesn’t disagree, but also says, “What happens during a searchand-rescue operation is equally as important.”

A Lack of Standards and Standardization For the most part, pilot organizations have procedures for search-and-rescue of pilots or crew members ending up in the water. These procedures are rarely standardized because (a) there is a lack of standard pilot boat designs,

16 the maritime executive

(b) operating environments are unique to every pilotage area, and (c) there are varying degrees of skill for pilot boat operators. As such, the argument that “my boat and operational environment are so unique that fundamental principles do not apply” is often heard in the wake of an incident. But Steve Wigely says, “After a mishap, this is seldom true.” Since over the course of the last 24 months at least four of the five marine pilot deaths occurring in U.S. waters have involved men overboard and unsuccessful efforts to rescue them, he might very well be right. The matter of safety can and does extend beyond the equipment being used. In Connecticut, worries over pilot safety at the Bridgeport Anchorage have prompted local pilots to use an “outside” launch service. According to Connecticut Pilot Commission meeting minutes, “Several pilots expressed concern over safety issues involving the Bridgeport launch service at the anchorage. Currently, the pilots use a competing launch service from New Haven at a substantial additional cost.” Pilot officials are on record saying, “The launch proposed for use at the anchorage is deficient in its ‘man overboard’

retrieval system, handrails, walkways, and means of egress.” This issue remains unresolved and continues to be a matter for discussion at Connecticut Pilot Commission hearings. On Long Island Sound, however, equipment deficiencies are just one of a myriad of headaches for local, so-called “Memorandum of Understanding” (MOA) pilots. These local pilots fall under the joint jurisdiction of both Connecticut and New York. They have been negotiating and arguing about a pay raise for more than 24 years. Beyond this, there is no money allotted from the state of Connecticut for training, nor is there any real hope there will be in the near future. The Long Island Sound Pilots are easily the most poorly compensated and worst equipped in the United States. Furthermore, Connecticut remains one of the few – if not the only state – not to reimburse its state pilots for reasonable expenses related to the job. Captain Vin Cashin of the Connecticut MOA pilots told MarEx that he was in the process of trying to obtain a “float coat” vest, which is a safety device that carries an emergency transponder to help locate a pilot if he accidentally falls into the water while boarding or disembarking from a vessel. “We may be able to get it from Rhode Island,” said Cashin. Safety-conscious Rhode Island reportedly pays for the $2,000 devices for all of its marine pilots. The vests are standard equipment elsewhere, but not on Long Island Sound, where pilots cannot afford the extra expense. Recently, the prospect of the much-heralded arrival of a 1,026-foot Royal Caribbean cruise ship to the Port of New London, Con-

difference life and death necticut in September prompted Cashin and one of his fellow pilots to travel to Florida in order to get high-tech simulator training before the vessel’s arrival. “It is important that we stay current with the newest technologies on these ships,” said Cashin. He added that he had not been reimbursed for the trip or the training, which he stated was essential to ensuring the safety of the mega-ocean liner. Unspoken in all of this is the fact that Cashin and his colleagues are forced to choose between training for competency or trying to obtain rescue training for pilot boats that they do not own or even control. There is good news, however, for all pilots, including those on a limited budget. Wigely’s firm charges about $1,000 per day for training, which usually lasts no more than four or five days. For pilots grossing as much as $500,000 annually, the tab is a drop in the bucket when considering the downstream benefits of training, which can be amortized over as many as six pilots at once.

How It Works and Why It Does Wigely calls for focused, standardized Rescue Training for Pilot Services in the same structured and logical manner in which he

conducts each of his training sessions. What he proposes for each and every pilot organization operating in U.S. waters makes a great deal of sense, especially since it is based upon years of experience in many small-boat regimens. Wigely and his staff lay out the case for formalized pilot rescue training below:

> Rationale for Rescue Training for Pilot Services Standardized and formalized rescue training is clearly lacking at some pilot organizations. “Homegrown” procedures, currently in place, may or may not work, and may or may not be defensible afterwards. Some organizations – not just pilots – practice procedures that do not work in real life and are not in accordance with recognized principles. Professional boat operation organizations that will someday have a duty to perform rescue should conduct drills that will work in real life, that are referenced to known principles, and that are taught by professional trainers with an exhaustive background in actual water rescues.

> Benefits of Formal Training Formal training compares well to an outside audit by testing procedures currently in use for

practicality and defensibility. The training also compares local practices with standardized procedures and establishes defensible references, as opposed to using the time-honored but rarely successful mantra of “We have always done it this way.” Beyond this, the training is designed to prevent “devolution” or “procedure creep.” Both homegrown and outside training will change over time without periodic refreshers or audits. Homegrown training is especially vulnerable because it had no standard reference at inception.

> Professional Training Provides Usable Curriculum and Instructors Skilled in Conveying It Pilots get required, formalized training regularly at merchant mariner and union schools for very good reasons, and at a significant cost to these organizations. When the worst happens, their lives are in the hands of the pilot boat operator (and deck hand, if there is one). Providing equally professional training in rescue operations to pilot boat operators only makes sense, especially since a rescue boat operation is a rare occurrence for them. Most operators have rarely if ever been involved in a real-life rescue operation.

the maritime executive

difference life and death > Training Provides Pilot Boat Operators With More Than One Option The pilot boat crew (or sole operator, which can be the case at some pilot services) should know his or her practicable options and be able to perform them properly and immediately. Pilot boats are not standardized, and each pilot service operates in its own unique environment. Pilot boat operators are already expert in operating their boats and in their environments, but this can and is used as a specious argument: “My boat and environment are so unique that fundamental principles do not apply.” After a mishap, this is seldom true. Instead, it is a fact that all pilot boats will utilize one of four modes of victim recovery. They are: ■■ A bow-on approach ■■ A stern-to approach ■■ A smaller boat launched from the pilot boat ■■ They will always have one or more persons aboard any of these boats. Similarly, the environments in which the rescue will occur will always be: ■■ In open water ■■ In or near a hazard. A body of knowledge, referenced procedures and shared principles apply to all of these situations.

> Liability After a mishap or fatality, there is always an investigation. Often, this is followed by legal action. In either case, the following questions are almost always asked and very early-on in the process: ■■ What training was provided to the boat operator and crew? ■■ Who did the training? ■■ How long ago? ■■ Were the procedures employed by the operator and crew IAW training?

> Risk Assessment and Team Coordination Training In 1994, the USCG instituted “Risk Assessment and Team Coordination Training nationwide. By 1997, mishap rates in small boat and cutter operations had declined by 71% compared to pre-1994 levels. Risk assessment training should also be implicit in formalized rescue boat training and can also be offered

18 the maritime executive

independently. As a general statement, however, risk assessment and liability are two areas which should go hand-in-hand, with one meant to minimize the effects of the other.

> Search Patterns Wigely says that “Search Patterns” are analogous to CPR – guidance changes two to three times per decade. Failure to learn how to do open water searches is equally analogous: Failure to update the training periodically is like failure to renew CPR training. Steve’s experience is that very few of the clients he has trained – with the exception of Coast Guard personnel – have the slightest idea of how to conduct a search pattern in open water with a boat. Many do not even know that established procedures exist and almost universally expect to apply “common sense” to this essentially statistical problem. Familiarity with this subject is unobtainable except through formalized training and should be incorporated into an individualized SAR training program that is relevant to the type of boat, environment and personnel involved (per STCW).

Getting It Done: Use Any Qualified Trainer, But Do It, Without Fail Steve Wigely makes his living doing one thing: He provides rescue training for pilot services and other similar entities where smallboat operations are an important part of the business model. As Wigely says, “This isn’t part of a menu of fifty things that we do.” He

also believes that the market for this type of training should be a large one and that every pilot service ought to have this kind of training, whether he does it or not. That having been said, Wigely has few peers in the business, both in terms of his depth of experience and his wide and varied client base. Wigely started his business back in 1983 with his partner, both of whom were Marine Safety Officers at the City of Newport Beach, California, Marine Safety Department. With 30 years of combined experience in ocean rescue, including rescue swimming and boat operations (30-foot, twin-screw surf rescue boat that made “stern-to” approaches to victims), he soon branched out into other areas. Initially specializing in Rigid Hulled Inflatable Boat (RHIB) and Inflatable Rescue Boat (IRB) training for the USCG, he has continued that relationship for more than 22 years. Over that period, he has conducted more than 1,000 training classes for the U.S. Coast Guard, the U.S. Army, the U.S. Marine Corps, Military Sealift Command, NOAA, and more than 100 U.S. Navy combat ships. Along the way, he has also taught at virtually every one of the better known merchant mariner or union schools – and helped to develop curriculum at some of them – and today continues to provide training at the Maritime Institute of Technology and Graduate Studies (MITAGS), the Marine Engineers Beneficial Association (MEBA), Pacific Maritime Institute (PMI) and the University of Alaska. While Pilot Rescue Training is clearly one of his passions, Wigely’s expertise does not stop there. As the first company to obtain the U.S. Coast Guard’s Standards of Training, Certification and Watchkeeping-1995 (STCW-95) Fast Rescue Boat Certification, Wigely has trained and developed rescue procedures in RHIBs, single screws, twin screws, Arneson Drives and jets in boats ranging in size from 13 to 65 feet. He is also a recognized expert in davit operations and launch-and-recovery from ships, curriculum development and, interestingly, has worked as an expert witness in carefully selected rescue boat-related legal cases. But Steve still performs most of the training himself and regularly finds himself in the water being rescued by his students. Other staff includes a former USCG Academy Instructor, USCG retired Surf-

difference life and death men, active and retired Marine Safety Officers and law enforcement officers. Marine Rescue Consultants, LLC is by no means the only outfit out there providing this type of service. But for a while, back in the mid-1990s, MRC was the only source for STCW Fast Rescue boat training. Wigely’s most recent and perhaps most high-profile clients include the San Francisco Bay Pilots and Los Angeles Pilot organizations.

More Than the Bottom Line About fifteen years ago, and in another life as a marine consultant, a friend of mine told me that if I wanted to sell anything to anybody in the marine business, it had to be reduced to dollars – in other words, the bottom line. Looking at things objectively from a detached point of view, the case for Marine Rescue Training for pilot organizations probably fits under that business strategy as well. And while it is possibly callous to say so, the mitigation of risk and limitation of liability may well be the most compelling reasons to give Steve Wigely a call. But they shouldn’t be. Last year’s accidental death of Columbia River Bar Pilot Kevin Murray resulted in a federal lawsuit against the operators of the pilot

boat, Chinook, and the ship, Dry Beam, from which the ill-fated pilot was attempting to disembark at the time of his death. Brought to United States District Court in December of last year, the suit alleged unseaworthiness, negligence, and also referenced Jones Act and Longshore Harbor Workers Act issues. The fifty-year-old Murray was an seasoned mariner with about thirty years of experience, primarily in the coastwise tanker trades. Sometimes, these things end up being mere footnotes from which everyone moves on after tiring of reading about it. In 1982, however, I relieved Murray on a chemical tanker on the U.S. Gulf Coast. He and I then relieved each other in the Second Mate’s slot for about eighteen months, but on that first trip the company had him ride for a week with me since I had never before sailed on this class of vessel. I found him to be an exceptionally sharp mariner, from whom I learned much. I often wonder what happened on that last, deadly assignment that would end up costing Murray his life. Reportedly, as he disembarked the vessel, he fell into the water and attempts to rescue him were unsuccessful. His body was recovered days later. The federal lawsuit highlights a series of supposed mistakes that

led to Murray’s death, and the lawsuit specifically alleges, “During the Chinook’s attempts to rescue Captain Murray from the sea, Chinook ran over Captain Murray’s body, causing him injury and impairing his ability to survive.” Earlier this year, Lori Murray’s attorney, Joseph S. Stacey, told MarEx that both parties named in the suit had posted bonds of $3.25 million each and that the Dry Beam continues to trade in the area. The case could bring to the forefront the question of liability for countless other U.S.-based, state pilot organizations. According to Stacey, Saddle Mountain, Inc. was a contractor to, and provided pilot boat services for, the Columbia River Bar Pilots. Stacey added, “The pilots are also shareholders in the company.” The Columbia River tragedy and other recent pilot deaths simply underscore the dangers of working as a marine pilot. More than that, this type of event should be a wake-up call for all pilot organizations to ramp up their knowledge in the area of marine search-andrescue and also to make sure that the boat operators, on whom their lives may depend, are fully up to the task. To be sure, it’s about money, risk and liability. But most importantly, MarEx it’s about saving lives.

the maritime executive

bourbon measuring up

BOURBON Interview:

Measuring Up in the Face of Tragedy

By MarEx Staff

BOURBON’s CEO, Jacques de Chateauvieux

In recent months, the French energy support giant, Bourbon Offshore, has made headlines around the world due to the accident involving the anchorhandling vessel Bourbon Dolphin and the deaths of some of its crew members off the Shetland Isles in the United Kingdom. No one will ever question the professionalism of BOURBON’s crisis management team; as the event played out in full public view, its senior executives, who never shied away from the media, comforted the family members of the Norwegian crew. In fact, BOURBON’s CEO, Jacques de Chateauvieux, recently traveled to the United States and made himself available to members of the global media in New York City in early September 2007. The company released its first half of 2007 financial results on August 30, which reported that its gross operating income (EBITDA) was up 40.2%; operating income (EBIT) was up 59.8%, and net income (group share) was up 90.2%. Yet, just as de Chateauvieux spoke about the company’s astounding growth, he courteously answered questions about the accident as well. MarEx used its allotted time to speak to the busy globe-trotting CEO about the Bourbon Dolphin, the company’s huge investment in training simulators, and about crew recruitment and retention. MarEx: First of all, we are very sorry about the circumstances surrounding the Bourbon Dolphin, and extend our condolences to everyone at BOURBON, the families, crew and others affected by this tragedy. However, can you offer us an explanation of what transpired in the UK? 20 the maritime executive

JDC: First, let me say that we are appreciative of the many people and companies throughout the offshore industry, and throughout the world, who offered their support and comfort to the families and crew of the Bourbon Dolphin. Our company has established the Bourbon Dolphin Foundation for the families of the crew, and the outpouring of contributions has been heartfelt and very much appreciated. In terms of what we can say, the Bourbon Dolphin was a six-month-old vessel designed by Ulstein. It was an A102 model with 194 tons of bollard pull that was built in Norway and was heavily tested during the winter of 2006 through 2007 in the North Sea. The crew was skilled and experienced in performing anchor-handling operations in the North Sea. Furthermore, Captain Odden Arve Remoy was one of our most experienced mariners and could have taught vessel

operations at the school. He had just finished working for us in Angola, and his work received numerous accolades from many of our customers. He truly was a good person and a very competent captain. The Dolphin was contracted to move a rig in 1100-meter-deep water, per the client’s specifications. Prior to beginning the project, its procedures were established by the company performing the rig move and were approved by both the rig owner and the client/operator. A pre-job meeting was held in Aberdeen, which resulted in designating the Bourbon Dolphin as the “Assisting Vessel.” However, during the rig move, the Bourbon Dolphin was substituted to act as the “Main Vessel.” She capsized while deploying the last anchor due to the effect of three main factors: excessive weight on the anchor chain, a broadwise tension, and a strong transverse current. With that being said, nothing can bring back the precious lives that were lost, and that is our biggest regret about the event. MarEx: Tell us about the ongoing investigation, without going beyond what you can divulge. JDC: Well, as you probably know, separate investigations are going on in the United Kingdom and Norway. These professional investigations will take time, but eventually the reports about what happened and why will become public. Our crew and our management have testified and done everything possible to ensure that the investigators have absolutely all they need from BOURBON. Beyond what I have just said, I cannot comment more on the subject. We must let the findings of the professionals take their course.

bourbon measuring up MarEx: Has the speculation of uninformed people had an impact on BOURBON’s employees and on the crew’s families? JDC: Unfortunately, speculation only hurts our employees and puts them at risk. Until the final analysis is completed by the proper authorities, who will certainly exonerate the crew of any mistakes and validate its adherence to safety operations, criticism and speculation only degrade the memory of the fine, hardworking people who lost their lives. It is important that our crews understand that if they are asked to do a job that they do not feel comfortable with, they should use professional discretion, and we will support their decisions at all levels of our company. Furthermore, we

sel could not do the work. That should have been the time when the Tow Master stopped the operation and brought the proper vessel in to finish the job. MarEx: Has there been any discussion about why they released the larger vessel? JDC: Let’s not make any suppositions while the investigation is ongoing. Moreover, let’s not speculate about the circumstances surrounding this tragic event. The people who are making statements about what took place are doing so foolishly and without regard to the experts investigating the facts. MarEx: What else can you tell us in advance of the report? JDC: BOURBON has done its own internal

are reminding crewmembers not to be “overconfident.” This type of behavior serves no one, and the loss of life is unacceptable for BOURBON and all companies working in the offshore industry. MarEx: Who made the decision to release the larger vessel from the operation? JDC: The Tow Master made that decision, and this will come out during the investigation. Furthermore, it is our understanding that the report is near completion and the English version will be made available around February 2008. Additionally, BOURBON’s practices and procedures will be investigated, like those of other companies in the industry have been. MarEx: It seems that a series of errors was made, especially by releasing the large vessel and putting a medium vessel into the lead position. JDC: It has been acknowledged that we tried to stop the operation at least two times. It quickly became obvious that the medium ves-

investigation. We have reviewed the facts and gone over the accident. We didn’t find anything that leads us to believe that company procedures were not followed. Again, I want to stress that if a captain is asked to do a job and is not comfortable with it, then the captain should refuse to do the job, and our management will support his decision. MarEx: You have said that BOURBON is a “transparent” company. What do you mean by that statement? JDC: First, we are prepared to bear the risk for our actions, and if a situation like the Bourbon Dolphin takes place, then we are willing to do everything in our power to openly resolve the situation. That means taking responsibility when it is appropriate. We have nothing to hide from anyone; we are a public company with financial results open to review. We are also a transparent company that operates in the global market with many employees and business partners. We cannot hide,

and do not intend to hide, the truth or facts about any circumstance. However, with regard to the accident, people need to be patient and wait for the final results. Other companies have had accidents; some even had vessels sink, but we would never take advantage of our competitors’ mishaps and speculate about their situations. While that has not happened in our case, no one can say that our company was not open to authorities and the media. We have opened our records, and we have complied with every request. MarEx: Recently, it has come out that BOURBON is investing in three new anchor-handling simulators and training facilities. Can you tell us more about these? JDC: Today, there is only one anchor-handling simulator in the world, which is run by the Aalesund University in Norway. Using the Bourbon Orca as a model for training, the simulator’s software, with its visual graphics and simulation of the bridge of the vessel, is extremely sophisticated. It was designed to teach mariners working on anchor-handling vessels to raise their skill levels and professionalism. We were so impressed with the first training system that we asked the university to build two more, at a cost of 2.5 million euros each. The first one is currently being installed at a naval school in Marseilles, France, and will be used to teach mariners in the European region, while the second will be installed within the next year in Singapore to train our mariners in Asia. With these two types of simulators, the two BOURBON training centers in Marseilles and in Singapore will deliver specific training for our large anchor handlers and also for the smaller and middle-sized vessels that work in shallower waters. These simulators will assist in raising the skill levels of seamen who work on the technically advanced anchor-handling tug supply (AHTS) vessels like those that Rigdon Marine has in the U.S. Gulf of Mexico. Furthermore, the simulators are not just for our employees; they will be available to other companies in the industry as well. MarEx: So, the investment in these simulators took place before the accident in the Shetland Isles? JDC: Absolutely. We had always intended to bring the simulators online to train our crews. BOURBON is committed to safety at sea, and it is mandatory that all of our employees follow the safety policies of our company. Our investment is not a reaction to a situation. We have spoken about these simulators during the last the maritime executive

bourbon measuring up few years, and people following our company know that to be a fact. MarEx: Will training on the simulators be a prerequisite for new captains before their first assignment? JDC: No. However, simulator training is an important component of a mariner’s skill level. The technology on the BOURBON vessels is very sophisticated and modern, and we want to train our officers to work on the bridge of one of these next-generation vessels in a professional manner, in BOURBON’s standard of quality. We want seamen, no matter what the skill level, to become familiar with the BOURBON bridge systems and anchor-handling operations. Training on simulators allows our mariners to work through various situations and have discussions with the instructors about the procedures of safe operations. BOURBON is committed to providing a safe workplace for our seamen, and that’s why we have invested millions of euros in simulation training. But working on simulators is not all the training that we offer our seamen. All of our people go through rigorous training programs at all levels of employment, from “able-bodied seamen” all the way to captains. Going through this training is definitely part of the job. MarEx: Tell us more about training and safety at BOURBON. JDC: Today, there are only about a few thousand people in the world working on anchor handlers, and the Norway simulator is the only one in the world capable of providing this type of training. By putting our mariners through various training drills, with different missions in different situations, their ability to learn improves quickly. You can make mistakes on a simulator that you cannot make in the real world without severe consequences. But it is also important to train people to react properly in a critical situation. For instance, let us say there is only one life ring for three men in the water after going overboard. One doesn’t know how to swim; one can swim but probably can’t keep it up for very long, and the last one is the equivalent of a gold medal swimmer. Whom do you throw the life ring to? Well, you give it to the one who is about to drown or he won’t survive. Beyond the simulators, training is a team job which requires people to work together and care about each other. MarEx: We have read that BOURBON is taking delivery of a new vessel every twelve days. How can you maintain the standards of competency for your seafarers with such a rapidly growing fleet? 22 the maritime executive

JDC: While this prolific building program might seem overwhelming to some people, it is part of our strategic business plan. With that being said, our vessels are built in a series of boats. We might build 20 of one series and 30 of another. When crews move between vessels, there is nothing new to learn about the ship’s configuration. The entire design is exactly the same as the last vessel they were on. So no matter where a crew member works, if he or she works on a new generation AHTS like one of our BOURBON Liberty series (Design GPA 654) in Singapore, he or she does not need to learn anything new to work on a sister ship in Angola. MarEx: Crew recruitment is the biggest

acknowledged that our growth is swift, but we have put excellent ship managers in place. We have six ship managers in Switzerland, Norway, France, Mexico, Brazil and Singapore. These ship managers are responsible for ensuring safe vessels and for ensuring that the crews continually meet our operating standards. Another example of being able to train a lot of personnel is our engineers being trained at the plants of the key manufacturers. We have a partnership with EPD Asia and EPD, Inc., who build all of our Diesel Electric generators for the Liberty Series, AHTSs and PSVs. Our engineers will go to the plant in China and train by fully testing the engine and driv-

problem in the global maritime industry. What methods are being used to meet the company’s seafarer requirements? JDC: The BOURBON fleet has an average age of 6.5 years. Mariners come to us because our vessels are modern, comfortable and offer a lot of amenities. We recruit from the fishing industry, oceangoing deepwater industry, the maritime academies and other offshore companies. The BOURBON standards for training are high; if a mariner has the skills set, we simply have to train him or her to our modern vessel standards. We train them for dynamic positioning (DP), diesel electric, anchor handling, and to any other needed specialties (HUET, HLO, etc.). MarEx: So, as we understand it, BOURBON has standardized the vessels and the training of mariners? JDC: Yes. We are standardizing our crew members’ capabilities. It is the core of our “B-Safe” program. At BOURBON, it is

ers, and monitoring the equipment. They can also go to the shipyard and see how the vessels are built and assembled. This training is expensive, but it is part of the standardization program within BOURBON. MarEx: Standardization worked well for the Japanese tanker fleet in the ‘70s and ‘80s. Are these policies assisting the company in retaining its seafarers? JDC: We are always looking at “life at sea” issues. Soon, all of our ships will be equipped with broadband. It is extremely important that, while away from home and their loved ones, our crewmembers are comfortable. Putting broadband services on the ships is just another modern convenience that will make life at sea just a little more tolerable. It is not the only way to keep people working at BOURBON, but it helps. MarEx: We thank you for your time, sir. JDC: Thank you to The Maritime Executive. MarEx

deferred compensation

by W. Richard Webster

Retirement Planning in Restricted Waters There is little doubt that governmental policy often creates contradictions; current U.S. pension policy is a prime example. While the Treasury Department laments America’s low savings rate and its impact on capital accumulation, Congress – mandated to balance the budget – has been passing legislation that severely restricts retirement savings. The resulting impact on a company’s retirement program is like trying to maintain steerage against a quartering sea with a head wind. The regulatory complexities and the parameters of deferred tax compliance have most managers at a loss when it comes to revamping or even simply understanding a company’s executive retirement program. There are two distinct elements in corporate retirement planning: executive planning and corporate policy. The executive planning portion consists of educating the individual and providing income modeling for future retirement needs. This is “head wind” of corporate retirement planning because it factors in inflation and discretionary income. The corporate policy portion addresses issues such as compensation expenses, inflation planning and regulatory restrictions pursuant to the company’s retirement policy. Determined by third parties, this is the “quartering sea” of corporate retirement planning, where plans most frequently stray off course. The first step in determining a retirement plan is establishing targets to allow for “adequate” replacement income during the retirement years. Commonly referred to as “replace 24 the maritime executive

ment ratio,” these targets can be calculated using an elaborate personalized spreadsheet or a summarized income bracket chart. The spreadsheet method totals all pre-retirement income and then identifies family expenses that will reduce available capital. Additionally, total expenses are adjusted for disappearing items, such as FICA withholding and job-related expenditures. However, expenses then need to be adjusted again for new items, such as elderly medical expenses and retirement travel. The various factors used in creating a comprehensive replacement ratio are addressed in an extensive study completed by the Employee Benefit Research Institute, which models incomes up to $500,000.1 To determine the correct benefit package for a future executive’s retirement, let’s use

Fred

Yearly salary of $200,000 with a 50% target bonus. Annual 4% increases. Current 401(k) balance of $500,000. Retirement goal of 70% of the projected age 65 salary - $360,200.

Atlantic Maritime

Provides a 401(k) Plan with a 50% match on the first 6% of contributions. Provides a Nonqualified Deferred Compensation Plan for bonus income and 25% of base salary.

the example of a typical corporate executive. Fred, 50 years old, is the East Coast Operations Manager for Atlantic Maritime Corporation. He has worked for the company for the last 10 years and wants to retire at age 65. Before Fred does his preliminary retirement plan review, he feels pretty confident about his current 401(k) account balance and the company’s annual matching contribution. However, after completing his retirement modeling, it becomes apparent that, by age 65, his retirement income will be inadequate. Under his current savings scheme, with inflation moving at a modest three percent annually and contributions at continued levels, including a six percent annual return on the fund, his balance will only be $1,833,121 at his projected retirement age. Fred’s retirement needs and average life expectancy require at least $3,065,450 in the fund at retirement, which includes Social Security paying its full benefit. By modeling his retirement needs, it becomes clear that he has a non-inflation shortfall of $1,232,329; to meet his retirement goals, he will need to add an additional $25,000 annually to the fund during his remaining 15 years of work. Fortunately for Fred, his company has established a company-sponsored “deferred compensation plan,” which has an annual enrollment opportunity and consultants to assist him in adjusting his future contributions. Because deferrals are not included in current income, increasing his annual contributions by $25,000 and even adding an

deferred compensation additional $10,000 for college savings will only reduce his current income by $21,000 at a 40 percent tax rate. The “Fred” example illustrates an efficient solution to retirement shortfalls faced by numerous executives. During the 1980s and 1990s, Congress reduced the taxable deduction for retirement contributions, which devastatingly impacted executives who earn more than $120,000 annually. Recent legislation has tried to rectify this, but employers must adopt the plan in the proper time frame, and the company and its executives must understand the plan’s requirements. What is a “Nonqualified Deferred Compensation Plan,” and how does it work?

under the company’s qualified pension plan so that the nonqualified plan formula defines the total benefit the participant will get based on a combination of both the qualified pension benefit and the nonqualified plan benefit.

itors of the company. Unlike qualified benefits, nonqualified benefits can be left entirely unfunded, and these informally funded benefits cannot be fully protected from company creditors. Further-

Taxation

more, if a company secures the benefits from its creditors, these benefits are constructively considered “received” by the beneficiaries of the trust and are immediately taxable. Most companies choose to elevate the security of the promised NQDC benefits through implementation of a special trust, known as a “rabbi trust,” named for a rabbi for whom a trust was first established. The rabbi trust holds assets solely for payment of the NQDC benefits – except in the event of company insolvency or bankruptcy, in which case it then unfortunately must be made available to the company’s creditors. While the rabbi trust cannot guarantee NQDC benefit payments in the event of a company’s insolvency, it has been the experience of many providers that the assets in a rabbi-funded trust will often be left intact to pay all or some executives. This practice encourages key executives to remain with the company during a reorganization period.

Nonqualified Deferred Compensation Plan Nonqualified deferred compensation (NQDC) plans work much the same way as tax-qualified plans. Key differences are discussed below.

Types of Plans There are two basic types of NQDC plans: defined contribution (account balance) plans and defined benefit plans. Defined contribution plans are schemes in which employees elect planned contributions, which are then supplemented or matched by the company. The most common qualified defined contribution plan is the 401(k) mirror plan. The most popular type of nonqualified defined contribution plan works just like a 401(k) plan. Employees elect to defer a certain percentage of their salary or bonus. Many companies will then match the deferrals on the same basis that they would match them in their 401(k) plans. Alternatively, the company can make discretionary contributions or no contributions at all. Contributions are credited to an account, which is additionally credited by earnings based on an external index, such as the Treasury interest rate, mutual fund earnings or company stock performance. Defined benefit plans are schemes in which the company promises certain benefits to its participants. Often the benefit is a formula that takes into account the years of service and the individual’s annual compensation. For example, a formula can be stated as: years of service times two percent times final average compensation during the executive’s last five years of service, up to 60 percent of the final average compensation. The promised benefit is offset by any benefits provided

As long as a plan meets the requirements of Internal Revenue Code Section 409A, participants in NQCD plans are not taxed until they actually receive a distribution from the NQDC plan. However, Social Security and Medicare taxes are paid currently, which mirrors the tax treatment of deferrals and account balances under a 401(k) plan.

Vesting There are no rules on how the vesting of deferrals or account balances must take place. While company contributions and companyprovided benefits can be vested in any manner the company wishes, common practice is for executives’ deferrals to be 100% vested, just as they are in a 401(k) plan. Matching contributions will often vest under the same schedule used by the company’s 401(k) plan. Defined benefit plans will generally follow the same vesting schedule as the qualified pension plan, but there is no requirement to do so.

Security One of the major differences between an NQDC and a qualified plan is security. Qualified benefits must be funded and are protected by a trust, which holds assets solely for the purpose of paying benefits under the qualified plan. These assets cannot be reached by cred

Funding As previously noted, NQDC benefits can be left unfunded and unsecured. However, when a company’s goal is to provide the highest quality NQDC benefit for its executives, it will most likely use a funded rabbi trust. These are most commonly funded with corporate-owned life insurance and mutual funds. Some compathe maritime executive

deferred compensation nies also use company stock when the benefit is based on the value of that stock. Any earnings on assets within the trust will be taxed to the company as if the assets were owned directly by the company. This is the incentive for use of a tax-deferred, tax-free asset like corporate-owned life insurance.

In-Service Distributions Recent rulings have enhanced NQDC plan distributions by permitting “In-Service Distributions.” This provision allows NQDC participants to designate distributions from their

account while still actively employed. The distribution must be scheduled for payment after the deferred funds have been in the account for a period of five years, and it is not subject to early distribution penalties or hardship restrictions. This enhancement creates a very effective method for accumulating funds on a tax-deferred basis for large future liabilities such as college funding.

Section 409A Internal Revenue Code Section 409A was enacted in 2004 and became effective with respect to deferred compensation earned after January 1, 2005. Section 409A provides rules with respect to elections: deferring compensation, how and when NQDC distributions will be made, and a host of other plans and arrangements including severance plans, phantom stock plans, stock option and stock appreciation rights plans. Section 409A also provides additional rules applicable to the funding of NQDC plans, such as prohibiting funding trusts outside the U.S. and prohibiting funding triggered by a change in the company’s financial condition.

Setting Up a Nonqualified Plan Communication: One of the most important aspects of a successful NQDC is the proper communication of the company’s plan as each benefit scheme will vary and documents and procedures are customized to fit the company’s compensation philosophy. For the first enrollment especially, it is recommended that the presentation be conducted live at the company’s facilities. The plan administrator should be capable of providing experienced and knowledgeable people to conduct these meetings. For later enrollments, the plan administrator should have the ability to conduct enrollments via Webcasts, teleconferences and/or video-conferences. Additionally, it is essential that the plan provide a Website that allows participants to enroll electronically and take advantage of a variety of online tools. These retirement and deferred compensation planning tools should help participants determine the amount and type of deferral to elect and the type and timing 26 the maritime executive

of their distributions. Administration: Ongoing comprehensive administration is what ultimately makes a NQDC successful. The chosen plan administrator should provide an administrative process that satisfies the needs of both the executive and the company. In today’s environment, this requires a robust and integrated data management system that provides efficient, automated information that is accessible not only by the plan administrator but also by plan participants and company administrators. Consulting Services: As one of his/her primary tasks, the plan administrator should provide consulting services. NQDCs operate in a complex regulatory and social environment of tax laws, securities laws, accounting rules, and economic and social policies. The goal of the NQDC consulting process is to implement the most effective benefit program possible for attracting, retaining and rewarding key executive talent. Additionally, by integrating the NQDC benefits with the other aspects of the company’s executive compensation program, regulatory requirements will be satisfied. The plan administrator should have significant technical expertise in the form of experience in accounting, actuarial science, and legal and finance staffing. This will help ensure the best results in providing the necessary value to the company’s key executive population. Fred, our hypothetical executive, has been fortunate to receive good consultative advice and the tools necessary to complete a sound retirement plan. Atlantic Maritime has delivered a calm sea and a fair wind. Jack VanDerhei, “Measuring Retirement Income Adequacy: Calculating Realistic Income Replacement Ratios,” Employee Benefit Research Institute – Issue Brief No.297, September 2006. 1

W. Richard Webster has over thirty years experience in the executive benefit field with time spent as Executive Benefits National Practice Leader for a Fortune 500 company. Webster earned a BS in Finance from Drexel University and an MSFS from American College. His professional designations include certification as Chartered Life Underwriter (CLU) and Chartered financial Consultant (ChFC). MarEx

case study • mitags/pmi

New Standards for Maritime Training case study • mitags/pmi

by Joseph Keefe

Visiting the Maritime Institute of Technology and Graduate Studies (MITAGS) for the first time is an impressive event. Founded in 1972 and located just minutes from one of the United States’ most efficient air/rail public transportation hubs,1 the school has everything located on its spacious, eightyacre tree-lined campus. The infrastructure includes a 232-room, three-star quality hotel and conference center, 45 classrooms and one of the most advanced marine simulation technology centers in the world. The quality of the infrastructure, the attention to detail and the professionalism of the staff boldly state that customer service is much more than a slogan for this organization. The most unique aspect of MITAGS is using its traditional training center role as a catalyst to help the maritime industry address some of its most challenging training, recruitment and retention issues. Partnering with industry and labor to “prepare for the future” probably best describes the organizational philosophy of MITAGS and its West Coast counterpart, the 28 the maritime executive

Pacific Maritime Institute (PMI). The schools’ strength is rooted in their ability to (a) conceptualize new training methods, (b) redefine the relationship of the school to the workplace, and (c) continually create new and affordable venues for individuals to obtain the knowledge and skills necessary to work at sea.

Reestablishing the Chief Mate/Master and AB-to-Mate Pathways The impetus for this change in philosophy was the implementation of the “Standards of Training, Certification, and Watchstanding Code (STCW-95).” Participation in recruitment and retention conferences in early 2001-2002 clearly indicated to MITAGS’ leadership that the “Code” would dramatically and adversely impact the maritime licensing, recruitment and retention processes. MITAGS and PMI responded to this emerging manpower problem and began pre-

paring for the new training paradigm. They did not “piggy-back” on another school’s efforts but got down in the mud and rebuilt their entire training program. It cost a lot of money and man-hours, but as the Executive Director of MITAGS and PMI, Glen Paine, stated, “This is what leadership is all about.” Today there are many mariners steadily advancing through the ranks due to the MITAGS and PMI commitment to meet the licensing challenges that were created by the change in maritime training standards.

Reopening the Hawse Pipe for 500/1,600-Ton Licensed Mariners Since 2001, the total population of credentialed mariners has grown by 16,800 to a total of 210,000.2 However, this growth was not uniform for all industry sectors and masked some very serious personnel shortages. Much of the shortage is being felt by the

1 The nonprofit training Trust was set up by the Master, Mates, and Pilots (MMP) and the major U.S.-flag shipping companies in 1968. The MITAGS campus opened in Maryland in 1972. 2 From the United States Coast Guard (USCG), National Maritime Center (NMC).

case study • mitags/pmi

PMI responded to the problem immediately by working with West Coast companies and other area partners to come up with practical solutions.

Eric Friend and Robert Becker

offshore supply sector, tug operators and a host of other companies involved in the 500/1,600-ton vessel market. Generally, these organizations are experiencing enormous difficulties in their attempt to find qualified mariners. Unfortunately, this circumstance occurs because the full array of talent that comprises the 500/1,600-ton component of credentialed mariners is just five percent (5%) of the total mariner population, and the numbers are shrinking. In fact, last year 215 Mates and Masters disappeared from the employment scene, with seven of the eight 500/1,600-ton license-level classifications showing losses or remaining essentially static. The only license classification to show a gain was the 1,600-ton Master group, which was largely a function of unlimited tonnage Mates “sitting” for the extra endorsement. One of the primary reasons for this drop is the substantial amount of training now associated with the “hawse pipe,” which is the traditional career pathway for these licenses. PMI responded to the problem immediately by working with West Coast towing companies and other area partners to come up with prac-

tical solutions. The result was the development of the first new Towing Officer Apprenticeship Training Program in the last quarter century. PMI’s “Workboat Mate Program” incorporates all of the training requirements associated with STCW-95 Officer in Charge of a Navigational Watch, Able-Bodied Seaman and the U.S. Coast Guard towing endorsement. It also includes a structured “on-thejob” sea-training apprenticeship. The “Workboat Mate Program” also reduces the required sea service by one year and provides more “hands-on” vocational training than most maritime colleges. Furthermore, it gives the towing company and the apprentice mariner a two-year timeframe to “get to know each other.” By the end of the training, the company has an apprentice mariner who meets all of the regulatory requirements, possesses an in-depth knowledge of the job onboard the vessel and understands the company’s specific operational requirements. In addition to providing structured training, the Workboat Mate Program also helps to resolve one of the most difficult problems for new mariners: how to pay for the training. The cost associated with the program is distributed between the student and the company. The student is responsible for tuition, room/board and transportation. The company provides a stipend during the sea-service period of the program. Note that the stipend generally exceeds the overall tuition, room/board and transportation costs. Financing is also an option through SLM Financial Corporation (“Sallie Mae”) or through Veterans Administration loans. This setup ensures that all parties involved have a financial investment in the success of the program. As an added retention incentive, many companies are now offering to pay off the apprentice mariner’s loan at the end of the program in exchange for longevity with the company. In this situation, the mariner “wins” because he/she has an affordable way to move up the organizational ladder. However, the company also “wins” since it does not have to make the training investment up front and

face the potential risk of the mariner quitting or leaving for another company.

Recruitment Part of the Hawse Pipe Pathway The program also includes an active recruiting component. Through the use of Web sites (such as www.workboatacademy. com), industry partners, military veterans’ outreach centers and dislocated workers programs, PMI has a steady stream of qualified candidates. Each candidate is interviewed by the school and the participating towing company that provides the shipboard billet, which helps ensure the apprentice candidate possesses the proper attitude and basic skill sets necessary for a successful maritime career. The success of this program over the last two years has resulted in a similar program being offered on the East Coast at MITAGS. Throughout the U.S. maritime industry, the Workboat Mate Program has been met with enthusiasm. “Prospective mariners now have a clear, fast-track approach to a career at sea, and companies now have a viable resource for recruitment,” says Russ Johnson, Port Captain for Dunlap Towing. Other participating companies include Foss Maritime, Moran Towing, Sause Bros, Vane Line Bunkering, K-SEA Transportation, Crowley Marine Services, Western Towboat, SeaCoast Transportation, Harley Marine Services, Allied Transportation and NOAA. Gregg Trunnell, Director of PMI, states “Interest continues to build as companies learn of the program.”

Simulation Technology – Key Component in Accelerating the Upgrade Process MITAGS and PMI continually invest millions of dollars to upgrade their simulation technologies. “We do not buy simulators for the sake of owning simulators,” said Glen Paine. “The changes at sea surrounding electronics and bridge configurations for deepdraft ships, tugs, and offshore vessels have never been more prolific. These vessels are truly modern marvels. Therefore, our investthe maritime executive

case study • mitags/pmi ment in simulation is done to ensure our training capabilities exceed the needs of the industry.” Gregg Trunnell added, “We recognize the important cultural changes now taking place on vessels due to technology. The ‘same old boat’ mentality is gone. Now, when we recruit, our first question is: ‘Rate your computer skills.’” Technology has expanded the mission of modern vessels. Structured simulation training under the tutelage of experienced instructors helps transfer the necessary knowledge and skills to run these expensive vessels with a minimum of mistakes. Ship owners do not necessarily have the resources to train their

working with MITAGS to conduct initial waterway suitability simulation. While the AES project may or may not come to fruition, MITAGS has gone to public hearings and provided expert testimony on relevant subject matter and defined the risk in an objective manner. MITAGS has also collaborated with other union and maritime schools to establish training standards that exceed world standards for U.S. mariners working on LNG carriers. This action was in response to the recent Maritime Administration initiative that will help place U.S. mariners on LNG carriers that call in the United States. It also led to a partnership with SUEZ LNG for the

Association of Lighthouse Authority’s (IALA) standards. However, the relationship really goes much deeper as MITAGS provides its facilities for ongoing conferences that are sponsored by the Coast Guard and other government agencies. “When the Coast Guard, the Navy or MSC meet and train here,” Paine says, “they can’t help but get a flavor of the commercial shipping world. Of course, our proximity to the Washington Beltway doesn’t hurt either.” Bruce Riley, U.S. Coast Guard Vessel Traffic Specialist, told MarEx earlier this month that their contract with MITAGS extends over the next five years. During that time MITAGS will provide its simulators and facilities for VTS

people to operate the advanced equipment, so that’s where the schools are a viable alternative. “Training mariners on the new equipment used at sea was a motivating factor in our investment for new simulation technology. It does not make sense to train our mariners on old equipment when the bridge is full of plasma screens and electronics,” states Walter Megonigal, Director of Training for MITAGS.

upgrade of an LNG Cargo Simulator that should be online by early 2008.

training while using course curriculum that belongs to the Coast Guard. “Only the U.S. Coast Guard has the right to direct traffic in the United States,” says Riley. He adds, “VTS certification will very soon be required for all operators, and when it happens, the Coast Guard, in cooperation with our partners at MITAGS, will be able to meet those requirements.”

Modeling and Training for LNG Today, there are more than forty Liquefied Natural Gas (LNG) import facilities in the planning or construction stage in North America. One of the major LNG terminal operators is Cheniere Energy, which is scheduled to open a facility on the Sabine River in 2008. In a cooperative program, MITAGS programmed the waterway and modeled seven LNG carriers to represent the range of vessels expected to be used at the terminal. The pilots and tug masters are now using the database and models to familiarize themselves with the new ships, tugs and berths. In another project at Sparrow’s Point near Baltimore, MD, the AES LNG Group is also 30 the maritime executive

MITAGS/PMI – “National Assets” Executives at the U.S. Coast Guard (USCG), the Military Sealift Command (MSC) and various members of government, as well as many maritime leaders, have called the MITAGS campus in Linthicum, Maryland “a national asset.” This is not an empty phrase meant to evoke a patriotic response. Instead, these comments reflect the wide variety of training programs provided by MITAGS. To visit the MITAGS campus is to understand that nowhere else is there a facility where mariners can be taught in such a unique, professional environment. One such example is the U.S. Coast Guard’s use of the MITAGS facilities for Vessel Traffic Systems (VTS) training. MITAGS assisted the Coast Guard in revamping its course curriculum so it would meet both Coast Guard and the International

Future in Training Helping to resolve maritime training problems and industry-wide shortages will continue to be a primary focus for MITAGS and

case study • mitags/pmi PMI. Programs like the successful “Workboat Mate” initiative will evolve to help address other unique challenges in the offshore supply, domestic passenger and inland towing sectors. They will also be expanded to include all departments. As the need to find replacements for retiring senior officers accelerates, MITAGS and PMI will enhance the learning process by more effectively integrating marine simulators so they can train mariners at a higher level in a shorter period of time. While simulation training can not replace job experience, it can help accelerate the learning process. In fact, the simulator can allow for many scenarios that just are not economically practical or possible in real life. At the same time, operational research programs will increasingly become an integral part of training by shipping companies, pilot organizations, tug companies and terminal operators. It is a very cost-effective way to determine operational parameters and mitigate risk. These programs will “push the envelope” in the use of simulation for personnel assessment and training.

No less important is the MITAGS/PMI commitment to special programs such as advanced medical, fire fighting and emergency response training. The safety programs are essential to safe shipboard operations. Old businesses, like LNG training, will reemerge in a big new way. From the shipboard crew to terminal operations training, this industry segment will require crews and employees who are trained to the highest level. New collaboration efforts will result as the recent LNG training standards conference3 and the upcoming LNG instructor standards conference attest. No less important is the MITAGS/PMI commitment to special programs such as advanced medical, fire fighting and emergency response training. These safety programs are essential to safe shipboard operations. Furthermore, the

3 MITAGS hosted a recent Maritime Administration initiative to set voluntary LNG training standards for U.S. mariners. Another conference is scheduled this fall for setting LNG instructor qualifications. All maritime unions and academies are expected to adopt these new voluntary standards.

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medical courses will become even more important as the average age of the seagoing workforce continues to climb in the short term. MITAGS and PMI’s heritage is with the Masters, Mates and Pilots (MM&P) and the Trust Companies that formed the school to train its mariners. Its experience in the deepsea market has been leveraged to serve new sectors of the maritime industry. Today, with over one hundred and fifty different programs for a myriad of commercial and government entities, MITAGS and PMI are national assets that are quite unique in the maritime training world. That kind of statement might have been a bit of a stretch in 1972, but today it just might be an understatement. MarEx

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executive

interview

From left: Barry Reese, John Scragg, Glen Paine, Eric Friend and Robert Becker

executive

interview

With the Team From MITAGS and PMI MarEx Ventures Out Onto the Cutting Edge of Maritime Technical Training – and More…

by Joseph Keefe

There are arguably no hotter issues confronting today’s marine vessel operator than managing the changing face of the 21st century mariner, navigating the regulatory environment that is driving those changes and then integrating the two components to provide a safer and more efficient work platform. As the shipyards crank out the most efficient and modern vessels the maritime industry has ever seen, reconciling these futuristic industrial workhorses to today’s mariner has already become “job one.” 32 the maritime executive

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interview

From left: Eric Friend, Robert Becker and Walt Megonigal

Finding, recruiting, training and, finally, retaining top-notch mariner talent seemingly constitutes four separate and equally difficult tasks. At least that’s what we thought before MarEx traveled to Linthicum, Maryland to spend time with the executive team from the Maritime Institute of Technology and Graduate Studies (MITAGS) and its West Coast affiliate, Pacific Maritime Institute (PMI). However, after two days of meetings it became abundantly clear that the metric for assembling first-class mariners for the foreseeable future and beyond has been inexorably altered. Glen Paine, Executive Director of MITAGS and PMI, has been the most visible person from these world-class training facilities. But what is most important about MITAGS and PMI is that the best captains from the best ships afloat understand they cannot do their job without a competent supporting cast of seamen. To that end, Paine assembled his executive team for the MarEx Q&A session. The interview included not only Glen Paine, but also Gregg Trunnell, Director of PMI; Walt Megonigal, Director of Training, MITAGS; Captain Robert (Bob) Becker, MITAGS’ Academic Business Development Manager, and Captain John Scragg, PMI’s Training Director. What they had to say might just surprise you. On the other hand, what they are already doing will probably change the way you think about training, partnerships and the world of human resources for mariners. Listen in.

MarEx: Mr. Paine, everyone talks about partnerships and collaboration when it comes to maritime training and technical knowledge. This can mean many things to many people, but you and your staff seem to have embraced the concept. Can you explain what it really means? Glen Paine: Partnerships and collaboration come in two parts. First, there are the official regulatory committees, such as Merchant Mainer Personnel Advisory Committee (MERPAC) and the Navigation Safety Advisory Council (NAVSAC), which are basically sponsored by the U.S. Coast Guard. Then there are the industry-regulatory blended program advisory committees. Ultimately, the partnerships with regulatory bodies and collaborations with industry advisory committees are the impetus behind the industry’s technical and training requirements. The benefit of our involvement with these regulatory committees and groups is that our customers are made aware of the pending licensing and training requirements in which we are involved. This allows our customers’ input as requirements are developed. Also, being involved allows us to get a clear understanding of what is transpiring at the congressional and regulatory levels. MarEx: So, by being involved with regulatory and industry committees, this allows your organization to assist in shaping training and educational regulations?

Glen Paine: Correct. With that being said, it is important to point out that any school or company or individual can participate in the process. I happen to be a member of the Coast Guard’s Merchant Personnel Advisory Committee (MERPAC). At these meetings everyone who attends is allowed to provide input and advice. Mariners are out at sea all the time, and since these professional seamen come to us for training and education, we can share their real-world perspectives with the U.S. Coast Guard before the regulations come out. MarEx: By de facto, MITAGS and PMI are advocates for the clients? Glen Paine: Advocate is a strong word. I would say we are “honest brokers,” because we simply bring both sides together. When it comes to safety-at-sea and well-trained mariners, we all want the same page, but we also understand that raising the bar comes from different perspectives. At MITAGS, enhancing the professionalism of mariners is the highest goal of our nonprofit organization. Over the last ten years there have been lots of changes, starting with the Standards of Training, Certification and Watchkeeping (STCW) regulations and the Maritime Transportation Security Act of 2002 (MTSA). You could go on forever about the compliance issues mariners face today. But, that’s our job to assist mariners in staying compliant and in advancing their careers. the maritime executive

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John Scragg: Regulations usually come from the U.S. Coast Guard, and we are very proactive in helping guide, not steer, them through advisory committees. Numerous times we have sent our programs to the Coast Guard so they can look at a program template, a hard proposal that reflects something more concrete than a concept. It is very important that training programs are not built in a vacuum but have industry input. After adoption of STCW-95 requirements, a major problem for the marine industry was a training path that

worked with you in developing educational curriculum for the Mate program? Gregg Trunnell: Currently, one of the biggest hurdles for the maritime workboat industry is recruitment and retention. We initially worked to establish an advisory committee and then worked with that committee to develop a program that would recruit, train and deliver trained mariners to that industry. A major player in this effort has been our “skill panel.” This panel meets bi-monthly, six times per year. Crew retention remains a major issue for many

The lesson is obvious: It is absolutely critical that we work together on matters that will affect mariners. facilitated the movement from Able Bodied Seaman (AB) to licensed mate. PMI developed a regimen of training steps that, when successfully completed, allowed that AB to advance to Mate. We listened to MERPAC; they produced an outline of what should be involved in an AB’s obtaining a mate’s license. Fortunately we were able to obtain a grant that helped finance developing the program. The key is we did not do it in a vacuum. We involved people from higher education, who assisted us in developing minimum levels for entry into the program. We also got members of the maritime industry to assist us in testing various training elements. From this, we learned a lot about what worked and what didn’t work. The maritime industry, regulatory bodies, training schools and the individual working mariner all worked together to develop viable, effective standards. The lesson is obvious: It is absolutely critical that we work together on matters that will affect mariners. MarEx: Tell us about the skills panel that 34 the maritime executive

of the prominent industry groups, such as the Maritime Administration (MARAD), the Passenger Vessel Association (PVA), the American Waterways Organization (AWO), Ship Operators Cooperative Program (SOCP), the Offshore Marine Service Association (OMSA) and even the foreign operators. The issues are as diverse as the companies in the maritime industry. Along the U.S. West Coast, we have partnered with many of the major tugboat companies to solve recruitment and retention problems. These partners, along with other educational groups, came together to create the skill panel. The panel was able to identify major gaps or needs in the tug and towing industry. It became very clear to the panel that recruitment and retention was one of the largest issues impacting the health of the industry. A major part of this effort was supported by a grant from the state of Washington. MarEx: Explain the grant, and on what benchmarks or goals was the money being spent? Gregg Trunnell: Absolutely. The first year

we received $80,000; the second year was $30,000, and we just received our third-year funding of $25,000. During the first two years the skills panel saw recruitment and retention as the number one problem and put their efforts and grant funding into solving this twopronged challenge. We also recognized there are other skill gaps and now we have funds for specific or more focused projects. A major success for us was the “endurance management program,” which is a result of the skills panel’s efforts. This is not the same as the Crew Endurance Management System (CEMS) program developed by the U.S. Coast Guard. The skills panel worked together to develop a more regionally focused and relevant program that addresses the nature of vessel operations along the West Coast. A working group has been formed to review the issues of crew endurance. Over the past couple of years, we had great success with this approach. This third-year funding provided a $25,000 grant to be used solely in finding additional funding to continue to support or efforts. MarEx: Consequently, the ‘Workboat Mate’ program could be seen as a deliverable from the skills panel input and the grant funding? Gregg Trunnell: Absolutely. The success and industry acceptance of this approach can be seen by the fact there are companies that didn’t need new recruits, but believed in the necessity and validity of the program and agreed to take apprentices to work on their company vessels. That’s a very big deal. MarEx: Let’s be clear on the concept. The skills panel, the grants, West Coast companies, and the program advisory committee have come together to create a program that will take non-mariners and develop a new source of mates for workboats and offshore vessels? When does the first group graduate? Gregg Trunnell: June 2008. Robert Becker: If I might interject, this program is now working on the East Coast as well. In 2001 and 2002, MITAGS began working on recruitment and retention issues. We have been aware of the industry’s concerns for several years. Today, the benefits of the Mate program are obvious; the concept is really catching on. In fact, this type of program is applicable to engineers as well as deck officers. Our feeling is that it can be done for any sector of the industry because it is a cost-effective way to bring new people into the industry. MarEx: Are the traditions of the East Coast market making the process different? Robert Becker: The West Coast got onto the bandwagon sooner. Tanker escorts and escort

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tugs brought forth different ways of doing business along the western states. People working together on the Harbor Safety Committees for the development of escorts learned they could work together in other areas without giving away trade secrets or their competitive edge. Gregg Trunnell: Positive things are happening out there. I personally believe once the East Coast players come to the table things will change. All the companies want recruitment and retention programs. This point alone will bring them together. MarEx: It is not unusual to see three or four guys from each of the four East Coast maritime academies getting hired by the tug companies on the Eastern Seaboard. It is a natural career path once the young mariners get off the campus. Is this different on the West Coast, because there is only one traditional maritime academy and not as many potential recruits? Robert Becker: Even with the nearby maritime colleges, East Coast companies are having problems with recruitment and retention. The issue is academy graduates are just not staying out at sea. This particular issue drove companies like McAllister to reduce their draw from the academies and develop their own incumbent training program. Walt Megonigal: Moreover, wages are being driven up because companies short of trained mariners are using increased pay to take employees from competitors. This is a good thing for mariners, but it is also a symptom of a deeper industry-wide malady: Mariners are simply moving around. With this approach we will ultimately run out of qualified mariners through attrition and retirements. Great for the individual mariner, and believe me, I am glad to see the mariner get excellent wages, but the current approach insures the demise of the industry. MarEx: But the issue may even be deeper: Older generation equipment will have to be replaced sooner rather than later. In the past, getting new seamen might involve getting somebody off the street or stealing from your competitors. Now, the new-generation vessels have things like dynamic-positioning and diesel-electric systems, to say nothing about the state-of-the-art electronics on the bridge of a vessel. Perhaps it’s an issue of bringing in younger people because they are more computer savvy? Gregg Trunnell: Obviously, there is more high-tech equipment in the marketplace and, perhaps, that is an issue. And, perhaps, the

equipment is evolving a little slower on the East Coast. But I don’t agree with that perception. It is just a different market. We need a different approach to the next generation of industry-business methods. MarEx: And your new objective is delivering a new generation of mariners? Gregg Trunnell: Remember, recruitment and retention are now major considerations in developing any mariner training program. What I’ve heard for years is that people don’t want to be in the maritime industry. But we

interview

Over time, there were not enough able bodied seamen to man the vessels. Today’s companies understand they need to be part of the solution, and that means they have to grow their own. The PMI model is not the only way, but it is an efficient, cost-effective method to recruit, train and retain new mariners. MarEx: Talk about vocational versus academy route for recruitment and retention of mariners. John Scragg: I think the biggest thing is our approach to controlled focused sea-time being

John Scragg (seated) and Gregg Trunnell

The PMI model is not the only way, but it is an efficient, cost-effective method to recruit, train and retain new mariners. have learned through our www.workboatacademy.com web site that there are hundreds people interested in a maritime career. We have received over 100 applicants for our programs that begin in October 2007 and January 2008. With a recent agreement with Rigdon Marine, which will be providing four cadet billets, we now have nineteen company partnerships. Some firms are even forgiving the apprentice’s Sallie Mae loans and have agreed to pay the loan off every year a cadet works over a five-year period. Now that is a real plan for recruitment and retention. Glen Paine: In the past, companies didn’t need to spend a lot of attention on the career paths or advancement opportunities for their employees. For unlimited licenses, the academies were (and still are) the primary source, and the hawse pipe took care of the rest. In the 1990s this changed as reduced manning eliminated many ordinary seamen billets that fed the hawse pipe career path. The new STCW-95 requirements shut down the rest.

served in a specific industry. An academy cadet usually gets his or her sea service on a training vessel. Their service results in sea time but that time is not focused on a particular industry. Our program is about bringing the needs of a company together with the needs and desires of an applicant. Our apprentices are being trained to a specific area in the maritime industry. Their training and assessors are from that area of the industry, and the apprentice’s sea time provides him or her direct experience and focus in that area of the industry. This makes more efficient use of the apprentice’s sea time experience. It’s our job to assist by assessing the apprentice’s competency, making sure that s/he receives the required training and, if necessary, working to fill in any gaps that may occur in their onboard training. MarEx: In the past, blue water ships were considered to be the upper-level, unlimited licensed mariners, and the brown water were considered lower-level mariners. But today’s the maritime executive

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modern boats are technically advanced and equipped with very sophisticated equipment. Explain this aspect of your training and education and how it deals with this new reality? John Scragg: We train to the 1,600-ton level. Today, if you go on an offshore supply vessel, you will witness a level of technology that you will never see on the deep-draft ship. Glen Paine: Today, the vessels at sea, including deep-draft ships, tugs and offshore support vessels, more closely resemble an aircraft cockpit. However, we’re still moving ships

incorporating the STCW fundamentals into the Workboat Mate program. While some inland companies bemoan the advent of STCW, we understand that the premise of STCW creates good officers. The fact is that the STCW components fit well into the Mate program model. Utilization of the STCW theory and its application to the Mate program are what set PMI and MITAGS apart from the others being offered. MarEx: There has been a lot talk here about technology being the new issue for training mariners. How do you use the new MITAGS

Victor Tufts (seated) and Robert Becker

…with the fact that many of our instructors are professional working mariners, we were able and willing to change our approach much more quickly than the traditional schools. from point A to point B, and the basic job has not changed. The tools for doing so have changed, but not the job. MITAGS’ and PMI’s investment in advanced simulator technologies is to better educate the mariners and, hopefully, increase their skill sets. Gregg Trunnell: The U.S. Coast Guard has recognized these changes. They recognize the technology on the smaller platforms has become increasingly sophisticated. That is why the test for a 500-ton Mate’s license is exactly the same test for Second Mate unlimited tonnage. The old “tugboat” mentality is vanishing, and now we ask about their computer skills. MarEx: How is the new Mate program template being expanded into other areas? Gregg Trunnell: Interestingly enough, we have a new company that is taking twelve cadets annually. We will tailor a program to meet that company’s specific needs. This can be done for any segment of the industry: inland, cruise or coastwise operators. We are 36 the maritime executive

and PMI simulators to train the next-generation mariner? Walt Megonigal: We must be careful about throwing the “technology” word around. Technology only has utility and value if it is applicable to the training process. Without its direct application to the real world endeavors of mariners, there’s no point in having it. At MITAGS, we have integrated technology into our training schemes; we have done that only because new technologies have made their way into the wheelhouse. When I first came here ten years ago, I told Glen Paine that the maritime industry is at least 18 to 20 years technologically behind the aviation industry. Today, that is not the case. Perhaps it’s only five years or so, and maybe less. The new equipment on ships and working vessels like tractor tugs has allowed the vessel’s missions to be expanded. It is part of our mission to help train our mariners to operate these vessels safely, efficiently and effectively.

These expanded capabilities on today’s modern vessel mean there is a greater level of complexity and, consequently, a greater danger and possibility for error. After investing millions in newbuild boats with modern technologies, the owners don’t necessarily have the resources to train their people at the level necessary to utilize the built-in technologies safely and proficiently. That’s our business. Today, technology is the name of the game for the near-coastal and inland vessels. The new technologies stem from the needs of the industry to grow and evolve. When aviation went from prop planes to jets, the sophistication of the operators had to increase. The fact is they didn’t have pilots ready to take on the jet technology, so we had to train them. At that time, there was a ready-made avenue in the military called the Korean War. We came out of the Korean War with trained pilots capable of flying the commercial jets of that era. Nothing like that exists today in the maritime community; there are no military models which could train the modern commercial mariner. MarEx: We really like that comparison. Can we expand on the aviation-marine model a bit more? Walt Megonigal: Sure. The analogy goes beyond the prop-to-jets transition. Aviation has gone from jet aircraft that had a cockpit with 300 dials and buttons to a modern cockpit with three flat screen, multiplexed monitors. So what occurred was the requirement to manage the cockpit based on the assigned mission. That same evolution has occurred in the case of a ship’s master on his bridge. In the case of the maritime industry, it’s not about the technology as much as it’s about the people who operate it. The changes in the maritime industry have happened very rapidly during the last 10 years, but training institutions have been slow to pick up on it. It has been our goal at MITAGS and PMI to move our technological capabilities as far along the curve as possible. MarEx: Tell us about the evolution of MITAGS to meet this modern gap in training? Walt Megonigal: Professional mariners come to MITAGS to train and learn, but they will often say, “I’m sailing on those ships right now, and that is not what we are doing out there.” With that kind of input, along with the fact that many of our instructors are professional working mariners, we were able and willing to change our approach much more quickly than the traditional schools. We understood that we needed to train people on

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equipment they were actually using at sea. MarEx: Professional mariner feedback, say over a six-month period, may get you enough information to evolve a particular course, right? Walt Megonigal: It’s not even six months. Basically, our instructors experience what I call the “classroom triangle,” where a “subject matter expert,” a MITAGS or PMI instructor, stands in front of the classroom and shares the lessons learned from actually sailing. We have no students at MITAGS. I like to refer to our participants as attendees. They are professional mariners who are simply becoming more proficient in their careers by attending professional courses. Our subject matter expert, the instructor, teaches a subject about which he knows a great deal using a specifically designed curriculum and presentation approach. The attendees, who probably know a great deal about the subject, exchange information and knowledge with the instructor and with each other. Consequently, the triangle: from the instructor to the attendee, from the attendee to the instructor, and from one attendee to another. The classroom triangle is most noticeable in higher-level license courses. Because the attendees are constantly giving us feedback, we are always modifying

the courses to meet the changing maritime environment. It is a lot of work, but we need to stay alert and be proactive in the maritime training world. MarEx: Could there be a correlation with the AB-to-Mate and Workboat Mate programs providing interaction back about their real-world work issues? Walt Megonigal: Without question this will happen. It is interesting that when a new cadet comes off a tugboat, we hear things like “There’s no wheel in the wheelhouse; there’s only a set of controls.” So it’s obvious that as that cadet matures in the job, we’ll continue to get more valuable feedback. There are commonalities between the PMI Mate programs and the MITAGS Chief Mate-Master program. STCW-95 brought certain universal sets of training skills into focus. However, it is also about understanding the differences that allows MITAGS and PMI to train any part of the maritime industry. John Scragg: The reality of training is that you may have a highly skilled mariner pushing a large tow, but as technology increases the vessel’s capabilities that mariner’s skills need to be adjusted so s/he can effectively operate the new equipment. Most importantly,

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when that mariner attends PMI or MITAGS we now have the opportunity to learn from them as well. We are also receiving excellent feedback from the cadets as they return from their various sea-phases. This information is then applied to training modules to improve the course. Walt Megonigal: In Basic Ship Handling, we teach unlimited licensed mariners how to use the rudder, the wind and currents to their advantage. We find that this is the same set of skills we teach the captain of a tug or ferry. The universality of maritime skills is reflected in an experience I had years ago in the Gulf. I was working on a crew boat with a captain who was working off the 5th renewal of his 100-ton license. He could not read, but he could handle a boat under a rig in eight-foot waves like nobody’s business. The point is that he has as much to teach us as we might have to teach him. MarEx: We’ve addressed a lot of specifics about teaching and learning. What in the near and long term will set MITAGS apart from the competition? Glen Paine: There is no question that MITAGS has some of the best instructional staff in the world and that our cutting-edge simulation

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technologies are some of the finest in the business. Those are the easy things to talk about. Our campus infrastructure is equally important because it’s the finest training facility in the world. We run a first-class operation from the hotel and dining room to our classroom environments. Remember, our attendees are professional mariners and we treat them accordingly. Many of our attendees come here on their vacations, and they deserve to have a comfortable environment in which to learn. MITAGS is also set up to accommodate fam-

States today. U.S. mariners may possible be manning these ships operating at those facilities in the near future. Is the Institute working with any LNG facility or vessel operators? Robert Becker: MITAGS is working with Cheniere Energy on one of their major projects. They were one of the first to get a construction permit and their facility is scheduled to open next year. It is a cooperative program and we have modeled seven LNG ships, the terminal, and the Sabine River. The simulation is being used by pilots and tug masters

Today, we facilitate training for approximately eighty percent of the state pilots in the United States. ily members. We have recreational facilities, transportation, and the campus is close to BWI Airport, Washington DC, and Baltimore. MarEx: Can you mention a few programs done for clients at MITAGS? Glen Paine: Today, we facilitate training for approximately eighty percent of the state pilots in the United States. We are able to accommodate and support state pilot training primarily because of the operational research we do, which includes tug and ship interaction in specific ports. Additionally, the highly accurate databases and ship models allow our instructors to do so much more with the simulators during training modules. Having said all of that, the quality of the instructors is paramount. When you have the combination of excellent staff, up-to-date curriculum and high-quality training tools, the training programs provide a very professional experience. MarEx: LNG is all the rage, especially with the 40-plus import facilities in planning, permitting, or construction phase in the United 38 the maritime executive

for familiarization training. We have also worked for the AES Group at Sparrow’s Point, involving the initial waterway suitability simulation training here in Baltimore. Now, this is a prime example of MITAGS being an “honest broker.” We have gone to the public hearings and provided our experts on the relevant subject matter. We did not get involved in the political process but assisted in defining the risk factors. It helped insert some objectivity into the political debate. MarEx: The interactive nature of your tug and ship simulators is remarkable. But you also own some very sophisticated individual bridge setups as well. There are six or seven individual navigation areas that interact with the others on the same RADAR scope, talking via VHF with one another while being engaged during the same navigation-collision avoidance exercise. Are there many other systems equivalent to your setup in the United States? Glen Paine: Actually, not many to our level of sophistication. The bridge cubicles have

the same fidelity as the full-mission bridge and can be integrated into one exercise area. Each bridge cubicle has at least one channel of visuals to assist the person being trained to connect the dots about what is actually happening on the RADAR, ECDIS and the visual world. This is very important since the new generation of mariners grew up with computers and can rapidly master the technology. Their shortcoming is in interpreting the electronic information into what they should expect to see out the bridge window. This realization has made us update our electronic navigation courses. MarEx: Please elaborate a bit more on your technological infrastructure? Walt Megonigal: Technology is merely a tool to help accelerate the learning process. We teach by doing a scenario over and over again, and by making the next scenario a little more difficult. If simulation is too easy, it provokes boredom. If it is too hard, it creates frustration. And, in either case, learning isn’t taking place. With regard to the previous discussion, where there were different individuals doing the same exercise on different bridge setups, one person might be struggling while the other is doing very well. For the first guy, we can take a few ships off his RADAR and, for the other person, we can add a few and increase the difficulty of his scenario. That’s technology supporting the learning process. Glen Paine: We are also using simulation technology to provide advanced skills assessments. For ConocoPhillips, we are measuring the quality of communication between the members of the bridge team. This type of assessment wasn’t possible a few years ago. The mariners who have been through “bridge resource management” have very good technical skills, and now we are developing their communication skills. Many cruise lines are using simulation to assess the skill levels of their mariners. John Scragg: Holland America and Crowley Maritime are using simulation to assess competence levels. In fact, Crowley is using simulator assessments prior to hiring tugboat operators on both the East and West Coasts. Holland America is using simulation assessments for its deck officers to better understand any skill gaps. They are developing training programs to eliminate any deficiencies. Along the West Coast, pilot organizations are employing simulation evaluations to measure their candidates. Our goal is to provide an objective assessment. We provide a quantified, graphed report, which clearly

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identifies any weaknesses. MarEx: With simulation training being an integral part of education, what sets you apart from the other training facilities? Robert Becker: I believe it’s our thirty years of experience in simulation technologies and the quality of our instructional and engineering staff. Simulation technology has certainly improved over the years, but it still takes a substantial amount of internal work to create, program and validate a customer’s database, hydrodynamic models and desired exercises. To this end, we have developed a number of control systems to ensure that the simulation is as realistic as possible to avoid “negative training.” For example, we use simulator operators as part of the simulator instructional team. This is one of our great strengths. This approach frees the experienced instructor to focus on the training of the mariner. On advanced bridge resource management exercises we may have as many as four staff members involved. Finally, it is due to the skill level of the attendees. When you are training senior pilots, captains and tug masters, the simulation and instruction have to be top notch. MarEx: We’ve spoken a lot about simulation

training. Is there another high-profile course that should be mentioned? Glen Paine: Well, our medical programs are some of the finest in the industry. The MMP Trust companies made this training mandatory for senior officers twenty years before STCW-95. In today’s legal environment, it is a must to have someone onboard with advanced medical and other emergencyresponse skills. From a strictly humanitarian point of view, it would be a tragedy to lose a mariner because no one onboard had adequate medical or emergency-response skills. MarEx: MITAGS trains the Military Sealift Command (MSC) as well. Tell us what you do for them? Glen Paine: We take great pride in supporting our nation’s defense. These programs were set up to support the various MMP Trust companies such as Patriot Holdings, Horizon and Matson Lines that have ship operating contracts with the Military Sealift Command or MARAD. We also provide a substantial amount of training for civ-mars, the civilian mariners who sail on MSC ships. If fact we just built new confined space / damage control / CBRD trainers to enhance these MSCrequired courses.

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MarEx: While we were downstairs having lunch today, we could not help but notice that there were a number of U.S. Coast Guard personnel on the premises. Is MITAGS also providing instruction for them? Glen Paine: Most likely, the U.S. Coast Guard personnel on the campus today are here for VTS training. However, MITAGS also provides conference space to the Coast Guard and other government agencies. We are very proud of the Conference Center because it is one of the finest in the region. In terms of the military holding their conferences at MITAGS, the interaction between the military and the U.S. Merchant Marine is a great way to keep open lines of communications. MarEx: Being visitors to the MITAGS campus, it is obvious there is a tremendous amount of activity on the premises, including “students” and conference attendees. Tell us about the campus and its amenities? Glen Paine: Our hotel has 232 guest rooms, which have a capacity of 350 people based on double occupancy. We can handle over 1,000 day attendees with 55 meeting rooms, and the dining room can seat 450 people at one sitting. To give you an example of the responsive-

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ness of the Conference Center, a few years ago the Transportation Security Administration (TSA) contacted us about renting space to train their new airport security personnel for the BWI Airport. They called on Thursday and wanted thirty classrooms by the following Monday. We mobilized our staff and made it happen. That says a lot about the dedication of the staff and the flexibility of the infrastructure. MarEx: MITAGS and PMI are truly recognized throughout the world as the “leaders in mari-

minal facilities throughout the Western Hemisphere. They are using our simulator-based operational research as a way to mitigate risk. For example, the Bermuda pilots came to us for simulation-based training because they are now witnessing larger and larger ships entering their waters and ports. And as the Maritime Administration continues to negotiate with LNG operators to put U.S. Merchant Mariners on their vessels, we may encounter opportunities to provide training to those companies and crews as well.

We mobilized our staff and made it happen. That says a lot about the dedication of the staff and the flexibility of the infrastructure. time training.” What is next on the horizon for your organization? Glen Paine: Maritime regulations and the next generation of modern vessels are driving operators to train their mariners to a higher level. In recent years, both MITAGS and PMI have invested millions of dollars upgrading our simulation systems to ensure today’s mariners can work efficiently and safely on technically advanced vessels. Our Workboat Mate and AB-to-Mate programs are on the cutting edge of recruitment and retention issues. We must remain engaged with industry and government through partnerships and alliances. This all takes time and money, but it’s a commitment to the future. Gregg Trunnell: In addition to the Mate programs, we are also trying to bring non-mariners to the industry by offering a vocational onboard chef program, a vocational engineer program and a vocational AB program. Our operational research programs are growing in acceptance by pilot organizations and by ter 40 the maritime executive

MarEx: Partnerships seem to be a common theme for the Institutes. Do you partner with any other schools? Glen Paine: There is always some level of collaboration between MITAGS and other schools. LNG training standards are the most recent example of a collaborative effort between the schools. Partnering has been part of the MITAGS culture since its inception. We also support other nonprofits such as Project Liberty, alumni foundations and others. MarEx: Are there any other collaboration efforts that might be of interest to our readers? Walt Megonigal: Before Hurricane Katrina, we partnered with the University of New Orleans (UNO). The university has been trying to combine its transportation school with a U.S. Coast Guard commercial licensing program. However, they didn’t want to be a uniformed academy. After Katrina, UNO spent its time regenerating its infrastructure, and the program was put on the back burner. However, the concept

of offering a Bachelor’s Degree and a commercial marine license still retains interest within the University. The University is reviving this program, and PMI has been assisting them by formulating a template for the licensing portion of the program. All of the state’s three pilot organizations support the program, which has a goal of bringing Unlimited Third Mates to the industry. Gregg Trunnell: This UNO program falls under the “three-year apprentice mate” regulations. Students enrolled in the UNO program could obtain a Merchant Marine license without living on campus and wearing a uniform while getting a traditional college education. MarEx: Before we finish this interview, let’s address LNG training. Is MITAGS equipped to meet the training requirement for LNG vessels? Glen Paine: Absolutely. MITAGS has been doing LNG training since the 1970s. While many schools dropped LNG courses, we continued to offer a number of them and kept our knowledge base current. Our chief LNG instructor was a Chief Engineer on LNG ships for over 20 years, and he has continued to teach LNG courses to U. S. Coast Guard personnel and foreign mariners. In additional to his vast experience in the LNG industry, he still stays current by attending numerous seminars and interacting with friends and professionals in the LNG industry. Walt Megonigal: While some schools dropped LNG courses because of lack of attendance or cost, Glen understood that LNG was a viable energy source, of which someday the U.S. would consume huge amounts. For many years MITAGS was the only school in the nation to operate an LNG simulator. Recently, we shut it down. Even though it wasn’t completely obsolete, it did not reflect the latest in the technology of modern LNG ships. We’re upgrading our LNG simulation capabilities to reflect today’s standards. The new LNG simulator will come on line later this year or early next year. MarEx: Gentlemen, we thank you for your time. Can you offer our readers a final thought? Glen Paine: The influence of the international maritime community on training standards will continue to grow. It is imperative that the schools stay abreast of these changes in order to ensure that U.S. training does not fall behind world standards. It is also equally important to ensure that any new standard is implemented with the full collaboration and support of our domestic maritime industry and government. MarEx

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Homegrown Maritime Training and Compliance: Tradition, Innovation and Technology by MarEx Staff Three different approaches to learning put the exclamation point on this issue of The Maritime Executive. Emanating from different frames of reference, all three bring a distinct slant to the ongoing revolution in maritime training. Union-based or family-owned, training on site or from 3,000 miles away, today’s American maritime world has ramped up its game to the point where continuing education for mariners rivals that taught in any industry, anywhere in the world. Tune in and see why.

McAllister Towing’s “TUGBOAT U” Planning for the Next 140 Years McAllister Towing is a 140-year-old, familyowned towing company with a fleet of over 85 boats. The firm has always prided itself on the quality of its crews and the family atmosphere that pervades the company. The result: competitive pay, flexible schedules and the best medical benefits in the industry. But there’s more going on at McAllister than meets the eye. Training and crew retention are the name of the game at one of America’s oldest maritime companies. As a result, its future looks bright, indeed. McAllister demonstrated its continued commitment to its employees with the January 31st startup of “Tugboat U.” Tugboat U is a radically different approach to training in which McAllister deckhands can work a twoweeks-on / two-weeks-off rotation, but before heading back out they spend two additional days a month in the classroom. In two years, working full time, they can qualify as ABs and then sit for the 500-ton Mate exam. Those who choose to continue in the program then combine online courses in general education subjects to earn an Associate’s Degree. McAllister pays all the costs associated with the license and the degree. McAllister approached the Global Marine and Transportation School (GMATS) at the U.S. Merchant Marine Academy with a radical 42 the maritime executive

proposal: Send your instructors to McAllister yards for two days before a crew change and provide not just license preparation but actual classes in the marine subjects that a deckhand must master in order to advance to the wheelhouse. McAllister furthermore insisted that its employees earn the same academic credit given for those courses when they are taught to undergrads at the federal or state maritime academies. McAllister has also developed a basic seamanship training program with GMATS in which GMATS instructors work with McAllister captains to make them trainers and mentors for new employees just entering the industry. McAllister captains then become instructors and, using textbooks and materials supplied by GMATS, provide their McAllister crews with weekly onboard training classes that establish a firm base of maritime knowledge on which to build a career. GMATS partnered with the American Military University (AMU), which offers online courses in many of the marine and general education subjects, to develop the hybrid program, combining classroom and online training with laboratory work aboard McAllister vessels. This unique approach allows students to benefit from the technical expertise that GMATS and AMU bring to the program while learning vital hands-on skills from an experienced McAllister captain in the wheelhouse, where they will stand their first mate’s watch. The program has been approved by the U.S. Coast Guard and accredited by the Higher Learning Commission (HLC) of the North Central Association and the Accrediting Commission, Distance Education and Training Council. As McAllister plans for the next 140 years, it does so knowing that it will employ some of the best-trained – and most loyal, satisfied and safe – mariners afloat. And that’s no accident.

Calhoon MEBA Engineering School (CMES): Furthering the Mission of the Marine Engineers’ Beneficial Association (MEBA) While Meeting All of the Ever-Changing Needs of Today’s Professional Mariners “A well-trained mariner is the first and best way to ensure the safety and reliability of a ship. Bigger, faster and more advanced ships are going to be the standard in our industry, and those will require smarter, better-educated mariners to crew. This is one area where MEBA excels, and that gives us a significant advantage that must be put to good use.” This quote from Marine Engineers’ Beneficial Association (MEBA) President, Ron Davis, embodies the business and mission of the Calhoon MEBA Engineering School (CMES). Since its inception in 1966, CMES has provided quality training solely to the members and contracted company employees of MEBA. For years, the school has been approached by commercial and governmental organizations seeking access to its array of outstanding training and educational services. CMES now provides educational and training services as well as certificate programs to maritime professionals and technical industries. CMES has worked steadily to develop courses that satisfy emerging technologies and regulatory training requirements to meet the ever-changing needs of today’s professionals. Safe, secure, economic and environmentally sound transportation and handling of Liquefied Natural Gas (LNG) is at the forefront of domestic and international dialogue. Since 1977, CMES has been meeting the LNG training needs of its Deck and Engineering officers. Beginning with the operation of the first U.S. LNG carrier, the LNG Aquarius, MEBA officers have been the vanguard of the American LNG fleet. Over a period spanning four decades, MEBA has provided six companies in the LNG trade with Merchant Marine officers. CMES continues to provide the training required

maritime training by regulatory agencies for all officer billets in today’s modern, international LNG industry. In addition, the school develops and conducts exclusive training courses and seminars pertaining to company-specific systems and technologies, much of which is realized through the use of integrated simulation, whereby students are immersed in training scenarios that encompass standard shipboard and facility operations as well as non-standard situations based on system/equipment failure modes and effects. CMES and MEBA believe that as the underlying technologies of maritime transportation systems become more complex, the operator/maintainers must increase the scope and depth of their knowledge and skills. Therefore, CMES has formed a working alliance with TRANSAS USA to explore the power of leveraging new and legacy simulation systems that presently stand alone into an integrated and adaptable simulation/stimulation system-set. The goal of this venture is to elevate the students’ learning past the knowledge and comprehension level, and into the analysis and synthesis level. The twelve members who form the CMES Board of Trustees listen to mariners and monitor the trends related to the maritime work force. Owing to fluctuations in seagoing jobs and added regulatory complexities, the United States is losing its reserve of Merchant Marine Officers. Spawned from dialogue with the U.S. Department of Labor, the USCG and the Maritime Administration, CMES is exploring the development of a License Renewal Training Course to recapture and/or maintain the sailing credentials of these officers. CMES and MEBA consider this effort to be one of national pride and security. 2007 can be tagged as one of the most exciting in the school’s forty-one-year history. The scope of training was expanded again, adding courses such as Upgrading Engineers to the STCW Management-Level, gaining USCGapprovals for Marine High-Voltage Safety and Electric Propulsion, and creating the only Data Communications and Networking Lab germane to shipboard applications. The newly-formed alliance among MEBA and Excelerate Energy, EXMAR and Skaugen initiated new training in topics pertaining to LNG handling and transfers for Person-In-Charge (PIC) billets. CMES has over forty courses and in recent years has added an average of two per year. Nearly all courses are USCG-approved, covering marine engineering, control and monitoring technologies from the 1940s to the present day. But that is only part of the CMES story.

As articulated by Dr. Alan Kay when he was Director of Research at Apple Computer, “The best way to predict the future is to create it.” This belief embodies what CMES does for MEBA members to ensure continued delivery of the very best maritime deck and engineering services. Surveying the industry to determine emerging training needs is a perpetual task. As stated by a previous CMES Director, “MEBA is only as good as its members. And the members are only as good as their training.” Living up to its own high standards is the reason that MEBA’s contracted companies continue to rely on it to “deliver the goods,” something MEBA has been doing for over one hundred and thirty years.

Moxie Media: No Mystery to Mariners Everywhere Martin Glenday usually begins by telling his clients that the “Moxie” definition matches his business philosophy. The American Heritage Dictionary defines “moxie” as: (mok’se) n. 1. The ability to face difficulty with spirit, pluck, courage. 2. Experience; skill; shrewdness. 3. Initiative; aggressiveness. In actual practice, Moxie Media is a full-service Media Design & Production Company, founded in 1985 in New Orleans by Martin Glenday, also the President and Executive Producer. Moxie Media provides design and production services in a broad range of communications media: Film, Video, Interactive Multimedia, InternetWWW and Print. In the maritime and industrial world, Moxie Media, Inc. produces and distributes training and safety programs custom-designed for the demanding needs of today’s sophisticated workforce. With hundreds of video and interactive media titles in stock and under production, this firm can provide cost-effective solutions to safeguarding the health and productivity of maritime employees everywhere. Martin Glendale says, “Our approach to programming is to customize to specific industries. Workers want to hear the terminology and see the locations that they are used to, not some factory worker in the big city. Feedback from our customers lets us know that it’s working.” Moxie Media specializes in many industries, but its products are perhaps best-known in the offshore oil industry, the inland waterways industry, the maritime transportation industry, the petrochemical industry and any industry requiring OSHA Compliance Training. All of the programs in their catalog can be customized to a particular industry or company. The explosion of broadband Internet and expanded

bandwidth opportunities for shipping companies and other offshore platforms makes it easy for mariners to engage in distance learning and for their employers to provide multimedia training for their employees. Indeed, the hottest trend in training in the maritime industry is the availability of programs via the Internet for tracking crew records, utilizing a “Learning Management System.” And Moxie Media is right in the middle of all of it. As the founder, Martin Glendale brings strong leadership, vision and communications skills to the company. He honed these skills over many years, designing and managing the production of well over 100 training, safety and marketing programs for a broad range of leading business and industry clients - from ExxonMobil and Shell to Monsanto, Nissan and General Motors. Martin has served as President of the New Orleans Chapter of the International Television Association, the world’s largest association of film, video and multimedia professionals. Among the many programs developed for the maritime industry, Moxie Media has developed and hosted corporate enterprise, online Web training portals for surveyors and employees. This custom-produced program has titles which include: ■■ Confined Space Entry for ABS Surveyors ■■ New Employee Orientation Moxie also developed six modules of an Environmental Compliance interactive CD and Web-Based Training Series for ABS’s client, Maersk Line Limited, for deployment throughout their fleet. Glendale’s group also produced and developed numerous custom interactive CD ROM and Web-based interactive training programs deployed on another worldwide tanker fleet, including but not limited to: ■■ Lifeboat Awareness and Operations ■■ New Crewmember Orientation ■■ Visitor and Contractor Orientation ■■ Deck Gear Operation and Use ■■ Accommodation Ladder Operation and Use ■■ Hearing Conservation ■■ Hot Work ■■ Hazardous Communications ■■ Confined Space ■■ Respiratory Protection In addition, Moxie Media Inc. is a fullservice production company that provides script-to-screen video and software production services for the business, education and entertainment sectors. They regularly produce custom training or safety programs from the original concept to the final product at a cost MarEx that won’t break your budget. the maritime executive

a new era in communications

Broadband at Sea: Signaling a New Era in Communications A Wider Range of Satellite and Cellular Products Means Greater Productivity for Ships and a Friendlier Working Environment for Crews by MarEx Staff This morning, Gustavo Sanchez finished helping his son in Manila with his trinomial equations homework. Just before lunch, David Whitworth put the finishing touches on plans for his daughter’s upcoming wedding in Liverpool. Following afternoon tea, Captain Bob Bell pushed the button on a massive computer file containing the updated maintenance and repair data for his vessel as well as all of this week’s supply requisitions. Tonight, Constantin Miklonos will find out whether his ten year-old Saab will need a new turbocharger. So what, you ask? From your comfortable chair looking out over the harbor, all of this sounds pretty routine. But on board the VLCC Neversail, now located about 1,700 nautical miles from the nearest landmass in the southern Pacific Ocean, the seemingly mundane activities of a ship’s crew going about another monotonous day at sea are actually quite remarkable. Satellite communications and, for that matter, broadband service at sea are not new concepts. The need for ships to communicate with their shoreside principals has always been of paramount importance. The efforts that at one time or another involved waving funny flags, flashing lights, radio transmissions and Morse code telegraphy have, of course, evolved over time. And satellite communications have been around since the 1980s. Back then, in the Gulf of Mexico, a network of cellular telephone antennae made it possible for offshore oil and gas exploration operators to have 24/7 com-

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munication with their on-shore planners. All of this, however, came at a steep price, which put this sort of convenience out of the reach of virtually everyone but the businesses who needed it to remain competitive. But that was then; this is now. Today, a flexible and complete range of cellular and satellite communications, customengineered solutions, and antennae and tower services are available for offshore and onshore companies operating in remote environments worldwide. Just as demand is exploding for affordable broadband service at sea, however, so are the number of players stepping up to take advantage of this coming revolution for international shipping companies. The result has been a more affordable communications product, serving a wide range of shipboard needs, which can provide economy of scale for traditional uses as well as new pressures in an emerging and changing world economy.

This Is Not Your Father’s Broadband They still send the noon position report from sea. That time-honored message also still contains the bunker report and the other bits and pieces familiar to every ship’s operations specialist in every corner of the globe. On many vessels, however, this staccato burst of energy is likely to take the form of a huge computer file that will instantly update everyone ashore on the needs of the vessel and the status of everything from the temperature of

an obscure bearing on the main engine all the way to the PPM reading on the vessel’s oily waste monitor. On still other vessels, the “send and receive” will contain as many as 100 emails written by crew members to their spouses and loved ones. The possibilities are endless. A smaller number of today’s vessels employ crews who do not have to wait for the daily transmission; they have 24/7 “always-on” wireless service in their cabins. Off the coast of Gabon, an offshore supply vessel’s crew gathers in the ship’s lounge to watch the finals of the rugby championship, in real time, with a sharpquality TV image. And still other operators – and this is still a rarity, to be sure – provide ship-to-shore telephone communications at minimal or no cost to the crew. Large files packed with ship’s logistics information and management data now routinely go back and forth from ship to shore. Offshore exploration contractors can monitor multiple ROV operations using one skilled expert from a remote location by employing streaming video. The sky – no pun intended – is now the limit for anyone engaged in remote offshore, shipping and ocean transportation.

Separating Absolute Requirements and Frivolous Needs: Blurred Vision Determining the ideal communications package for your company in a fast-changing broadband market is no longer an easy task.

a new era in communications Even in a booming worldwide shipping market, cost-conscious owners need to ask themselves a series of questions: How much bandwidth do I need? Do I really need 24/7 “always on” capabilities? How often do I need to move data? Do I care if my crew can send email and / or communicate with their families in a cost-friendly fashion? The list goes on, and often the need for business efficiencies can spill over into the world of providing a comfortable and desirable work platform for the crew. Savvy operators are now finding that, not only can they afford to buy some previously “unnecessary” items, in today’s shipping world they can’t afford to be without these services any longer. In the 2007 world of ocean shipping, there is one constant that virtually all operators, no matter what sector of ocean business they are engaged in, have to face on a daily basis. The shortage of qualified seafarers in the best shipbuilding market in 60 years is driving an almost desperate quest to solve the worldwide problem of crew recruitment, training and, just as importantly, retention. Crew wages are at an all-time high everywhere, and it isn’t because the maritime executives reading this publication are in a generous mood. Faced with sailing “short” or not at all, some operators have resorted to – let’s just say it right out loud – stealing qualified mariners from their competitors. The practice has created a vicious cycle, which has resulted in wildly escalating wage rates in virtually every sector of the offshore business. And it is no longer silly to think that the word “broadband” may be a big part of retaining the seagoing talent you now have and attracting more. In 1980, going to sea involved writing letters home and then waiting for weeks or months to get a reply. During those fleeting port calls at exotic destinations like Carteret, NJ, telephone communication involved the long walk down the pier only to stand in line behind four other crew members who were trying to do the same thing. We’ve come a long way since then, of course. Coastwise mariners eventually took advantage of relatively cheap cellular communications, which proliferated at the end of the 1980s, but they still experienced the mind-numbing experience of receiving a four-figure cellular telephone bill after that particularly heart-wrenching call home to their sweetie while transiting the oil rigs in the Gulf of Mexico. Deep sea, blue water mariners transiting on long 30 or 40-day passages from one hemisphere to another were still out of luck, however. Ship-to-shore

communications on those vessels was still relegated to ship’s matters as a general rule, and it was not inexpensive. Today, the question of how to retain mariners for the long term in an occupation which involves long absences from home in a sterile, alcohol-free and sometimes monotonous environment involves a host of solutions. Treating these professionals right and making their stay at sea as pleasant as possible is probably the best place to start in what has become a strong seller’s market for today’s mariners. In an ideal world, this would entail streaming, live television, 24/7 “always on” telephone and WI-FI type email service. In the real world of competitive shipping, most of this is still out of reach for most operators. Providing just some of it may be the difference between idling a vessel while you shop for a substandard mariner at 2x wages and sailing safely and on time. Which would be more expensive? The unthinkable is clearly just around the corner. Bundling ship’s business with at least some level of crew amenities will very soon become the rule for the successful ocean operator. That’s because most ships already have some sort of hardware platform in place on board and in use. Ken Wright of Broadpoint Communications told MarEx recently, “If you are already using some sort of broadband, then the crew cost can be a small adjustment to your total package.” Beyond this, the separation of company data from crew amenities is essential, but not necessarily problematic. In truth, most shippers who choose to provide both will probably end up with an 85% (company) / 15% (crew) split in usage. How much of that cost they underwrite for their employees is a financial matter, but the results of that decision will very soon affect the bottom line in terms of crewing and manpower issues.

Innovative Providers: Many Paths to the Promised Land An increasingly crowded field is poised to answer the call for a wider, less-expensive and simpler way to provide the myriad of communication tasks now required on board the modern oceangoing vessel, offshore platform or any number of other workboats. This should be good news for operators as they shop for the right service at the right price. In this issue of MarEx, we take a look at just a few of the many communications providers catering to the marine markets and beyond. The list is by no means all-inclusive but instead provides the reader with a solid overview of available options:

Broadpoint Communications Based in New Orleans with offices in Lafayette and Houston, Broadpoint specializes in the design, installation, enhancement and service of telecommunications antenna, tower and satellite solutions. Broadpoint, owned by an affiliate of H.I.G. Capital, is the new name of the merged telecommunications operations of PetroCom LLC, Sola Communications and Coastel Communications. The new organization offers the most flexible and complete range of cellular and satellite communications, custom-engineered solutions, and antennae and tower services available for offshore and onshore companies operating in remote environments worldwide. Broadpoint customers now can expect an even wider range of cellular and satellite prod-

Ken Wright, Broadpoint Communications

ucts and services with 24/7 customer support to help them connect and deliver results. Broadpoint emphasizes increased productivity for companies operating in the harsh and often unpredictable offshore environment. The new company is investing heavily in expanding services globally and adding more value to existing products to provide even better coverage and a higher level of service for its customers. Broadpoint’s roots in its long service to the energy industry (PetroCom) are well known.

Broadpoint’s Service Offerings Include: Cellular: Broadpoint offers the first offshore 3G wireless network based on GSMtechnology platforms and services with more than 100,000 miles of coverage in the Gulf of Mexico. Service also is available throughout the maritime executive

a new era in communications much of the Western Hemisphere through roaming partners. The maximum mobility of Broadpoint’s cellular products and service keep people and data connected for voice, voicemail, texting, faxing, Internet, email, data and low-volume SCADA (Supervisory Control and Data Acquisition). Satellite: Broadpoint established its C-band satellite teleport and switch facility in 1986. Since that time, Broadpoint has commercialized its satellite expertise in the C-band and Ku-band frequencies and today operates one of the industry’s largest, most respected VSAT (Very Small Aperture Terminal) networks, with more than 100 active remote sites operating offshore and onshore. Broadpoint has ready-to-deploy satellite packages, allowing small-to-large customers to choose from low-cost shared bandwidth to private networks and burstable bandwidth on demand. With Broadpoint’s wide geographic coverage, satellite service options include: voice and voicemail, Internet data, VoIP, faxing, point-of-sale, multiple lines and PC connectivity, connectivity to public and corporate networks, backhaul, high-volume SCADA, SHOD (single hop on demand), video, large bandwidth applications, emergency response and dispatch services. Services: Leading energy companies and others rely on Broadpoint to engineer, design and optimize voice and data networks. Engineers perform field and turnkey engineering services, applying path profiles, reliability studies, topographic maps and more to create customized systems. Services include digital microwave systems, cellular systems, two-way systems, telephone switching networks, multiple-address paging systems, satellite LAN and WAN and VSAT antennae systems. Broadpoint executive leadership includes Ken Wright, who serves as President and Chief Operating Officer. Visit www.broadpointinc.com.

Mackay Communications Partners With KVH’s TracPhone® V7 to Provide an Exclusive VSAT Solution Positioned to meet the exploding demand for affordable broadband service at sea, KVH Industries, Inc. has recently introduced a new type of satellite communications service that enables small, 24” antennas to provide affordable, “always on” broadband data connections to vessels. The new mini-VSAT Broadband service uses sophisticated spread spectrum technology to provide vessels with data reception rates as fast as 2 Mbps and data trans 46 the maritime executive

mission rates as fast as 512 Kbps via a 24” KVH-developed marine terminal. The miniVSAT Broadband service is fast, “always on” and available in a variety of pricing packages that offer significant cost savings for heavy data users when compared with other traditional data solutions available for commercial and leisure vessels. To support this service, KVH, under a joint development agreement with ViaSat, Inc., developed the TracPhone® V7 two-way broadband satellite terminal. The system combines KVH’s market leading antenna technology with ViaSat’s novel ArcLight™ spread spectrum mobile broadband technology. KVH created the 24” diameter antenna, the smallest stabilized satellite antenna available for providing broadband data connections to vessels. A breakthrough in antenna design, the TracPhone® V7 is as much as 65% smaller and 40% lighter than Inmarsat Fleet F77 antennas, and 85% smaller and 75% lighter than 1-meter maritime VSAT antennas. ViaSat developed a new maritime version of its ArcLight spread spectrum modem currently used on business jets and by the military. The two companies jointly integrated these key technologies to enable the TracPhone® V7 two-way broadband satellite terminal. Mackay Communications, Inc. will begin offering the new KVH TracPhone® V7 with mini-VSAT Broadband service as its exclusive maritime VSAT solution (TracPhone V7). A recent press release from KVH touted the new system. “This is what broadband at sea was meant to be,” explained Martin Kits van Heyningen, President and Chief Executive Officer of KVH Industries. “In order to create a ‘cable modem’ experience at sea, we developed a 24” diameter, rugged antenna and integrated below-decks system that is well-suited for maritime markets and utilizes SES AMERICOM’s satellite network. This combination allows us to provide broadband services to commercial, government and leisure vessels that previously were unable to support high data rates due to their inability to accommodate large, 1-meter antennas.” “The addition of the KVH TracPhone® V7 system to Mackay’s product line further increases the value of Mackay as an equipment and service provider to marine customers,” said Mackay Co-President Ben Pratt. “The TracPhone® V7 is absolutely the most exciting marine satellite product to be announced in many years. It is truly unique in the marketplace.” Mariners on professional, commercial, government and private ves-

sels will enjoy the benefits of the relationship between these two established leaders in the mobile communications industry, which will provide state-of-the-art service and equipment specifically for the marine market. According to KVH, the TracPhone V7® hardware and the mini-VSAT Broadband service represent the first end-to-end package of hardware, service and support available for maritime communications. The smaller antenna could save vessel owners tens of thousands of dollars in installation costs that often must be invested to reinforce superstructures and build custom platforms to hold the larger, 250 to 400pound antennas currently needed to receive and transmit maritime broadband signals.

KVH’s TracPhone® V7

Available starting in September 2007, the TracPhone® V7 and mini-VSAT Broadband service will initially offer coverage of North and Central America along with the entire Caribbean. Later in the fall of 2007, coverage is scheduled to expand to include the North Atlantic shipping routes and all of Europe. Key features of the TracPhone® V7 and mini-VSAT Broadband service include: ■■ True broadband connections at sea with data rates as fast as 512 Kbps (maximum upload) and 2 Mbps (maximum download). ■■ Affordable, flexible airtime subscription plans, including always-on, fixed price monthly options and per-megabyte plans with pricing up to 90% less per megabyte than existing maritime data services. ■■ Commercial-grade, 24” antenna that is 85% smaller by volume and 75% lighter than those used in existing 1-meter VSAT systems, making it practical for use aboard smaller vessels. ■■ Voice over IP telephone service with multiple, simultaneous lines.

a new era in communications ■■ GPS-based, automatic system configuration and antenna skew adjustment to support seamless roaming between regions and among satellites. ■■ Integrated hardware, service, activation and support for simple installation and operation. ■■ Visit www.minivsat.com for detailed information about the TracPhone V7 and the mini-VSAT Broadband service, coverage areas, hardware and service pricing, technology white papers, and more. Mackay Marine is a division of Mackay Communications, Inc., headquartered in Raleigh, NC. It is the largest high-seas service company in the United States with 14 offices covering all major port locations on all three coastlines of the United States. Mackay’s service network enables it to bring customers advanced applications, delivering timely, costeffective, quality solutions with high-quality customer service. Visit Mackay Marine at www.mackaymarine.com. Middletown, RI-based KVH Industries, Inc. is a leading provider of in-motion satellite TV and communication systems, having designed, manufactured and sold more than 125,000 mobile satellite antennas for vari-

ous applications, including marine platforms. KVH is the winner of the prestigious General Motors Innovative Design Award, two CES Innovation Awards, 22 National Marine Electronics Association “Best Product” awards and the DAME Award in the Marine Electronics category. Visit KVH at www.kvh.com.

Globe Wireless Globe Wireless provides flexible maritime solutions, satisfying all customer communications and IT needs. As the complete maritime solution, Globe Wireless offers applications for IT and operations worldwide, “Touch-the-Ship” service capabilities, ship administrative services, airtime, and messaging and data. Its worldwide presence allows Globe Wireless to build a direct relationship with the customer, devising and creating solutions specifically tailored for the maritime industry. Globe Wireless provides a premier communications solution combining the best of satellite and global digital radio network technologies, enabling high-quality, low-cost maritime communications. This combination of options offers customers one point of contact in managing their fleet’s communications and IT needs. A brief description of its services and capabilities is shown below:

HF Digital Radio Network The Globe Wireless Network provides vessels at sea with a truly global message and data delivery network. Since ships are always on-line, messages are sent and received in near real-time at much lower rates than traditional satellite connections, using a Digital Radio Data Network to enhance its satellite data transfer protocol. Using the advanced digital HF network, vessels are immediately paged when large files or attachments are

Globe Wireless dome

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a new era in communications waiting ashore, reducing the need to connect without knowing if there is traffic waiting.

Shipboard Software Globe Wireless bills its Shipboard Software as the premier communications solution combining the best of satellite and global digital network technologies to provide high-quality, low-cost maritime communications. Globe Wireless built a worldwide, 100% digital Data Network to provide the most cost-effective messaging between ship and shore. Globe Wireless offers expanded service to include enhanced satellite communications with integration of industry-leading technology. This state-of-the-art combination provides stellar performance for messaging and data file transfers to and from commercial marine vessels throughout the world from a single system. Features include: ■■ Email Connectivity: Connects to common stand-alone or LAN email software. ■■ Data Connectivity: Transport data for any application via MAPI, Internet, or file transfer. ■■ Message Waiting & Delivery Confirmation: FREE automatic notification of messages waiting and confirmation of deliveries. ■■ Enhanced Satellite Protocol: Optimized for high-speed and sustained throughput. ■■ Digital Maritime Data Network™: Worldwide network optimized for “Now” messaging. ■■ Integrated Invoice: Consolidates all communications charges. ■■ GlobeCrew™ Kiosk: A central private email location for the crew. ■■ 24-hour Customer Support: 7-days-a-week support, FREE Service messages from ship/shore. Benefits also include the sending of all communications from a single system, advanced email functionality, centralization of all ship/shore data communications into a single system and dramatically reduced need for costly dial-up of satellite connection. The network connection is available anytime and anywhere on the high seas, and the crew can benefit from email availability without increasing vessel communications costs.

Crew Solutions Globe Wireless provides flexible crew services. The voice or email virtual cards can be purchased by the shore office, the ship or directly by the crew. Since the cards are “virtual” there is less administration required of the shore office. The card PIN numbers can now be delivered, managed and activated via email. Calling cards for Iridium or Inmarsat A, 48 the maritime executive

B, M, Mini-m and Fleet may all be purchased. For the owner who wants to avoid costs associated with crew access, convenient email Virtual Communication Cards can be purchased for $25, $50 or $100. Globe Wireless is the only global vertically integrated network that is 100% dedicated to the maritime industry. Globe Wireless has flexible solutions that will satisfy all of the customer’s messaging, data, voice, application and IT needs. As one of the world’s leading global maritime communications company, the firm maintains customer relationships with over 500 ship operators, 8,000 plus ships and 12,000 shore-based user accounts. Globe

Broadpoint’s Ken Wright is equally optimistic about the future, but he cautions potential users that “it’s not a one-size-fits-all solution.” He told MarEx recently that some cost-conscious customers are staying with a cellular solution. “Not everyone needs an ‘always-on’ solution.” Broadpoint takes at least part of its roots from the old PetroCom LLC group and, says Wright, “We haven’t given up on this regional cellular solution, and this aspect of our business is still a significant portion of our revenues.” Certainly it is hard to argue that anyone else has more experience in the oil patch than Broadpoint. Without a doubt, the maturation of broad-

… ship owners really need to ask one question: “How much are you willing to pay in order to keep your crew?” prides itself on understanding that each customer has specific needs and on its ability to custom-build a package to satisfy any set of requirements. Frank J. Coles is President and CEO of Globe Wireless. Visit Globe Wireless at www.globewireless.com.

What’s Next: A Critical Connection Although broadband at sea is not new, communications providers and their seagoing customers are experiencing a remarkable phenomenon: an across the board 100% increase in crew voice traffic. Add to this the easy accessibility to email and an increasingly sophisticated mariner – at every level of the ship – and the stage is set for a wave of change that could rival the rapid onset of automation on the bridge and in the engine room. Frank Coles of Globe Wireless told MarEx in September at the 2007 ABS Users Conference that the question of what to do next is actually a simple one. He added that ship owners really need to ask one question: “How much are you willing to pay in order to keep your crew?” And while he conceded that costs would need to come down before anyone below the top 5% of owners could afford to completely underwrite all of the communications needs of their crews, he also says that day is probably coming soon. With more than 8,000 ships under contract and fresh off the acquisition of the assets of SeaWave & Rydex, he ought to know.

band coverage and the range of services now available will transform ship-to-shore communication forever, and for the better. KVH’s Ian Palmer says that the use of its new TracPhone® V7 product is “the missing link in the broadband solution.” Mackay Marine’s David Lemoine agrees. And it is unlikely that the name that has become synonymous with marine communications for decades – Mackay Marine – would partner with anything less. Whereas, until recently, the INMARSAT pay-on-demand method was the traditional solution, companies can now buy tiered levels of bandwidth on a monthly basis. The potential to improve the quality of life for all crew members is clearly here, but users may have to be monitored so that they do not engage in “data hogging” or inordinate bandwidth use. In other words, otherwise generous employers – and their communications providers – are not going to look favorably on offshore seismic workers engaging in on-line gaming on their downtime, and the live streaming broadcast of a child’s birthday party video is probably not going to go over well either. Arguably, that’s a small price to pay for the quantum leap that’s about to impact the lives of thousands of mariners everywhere. Without a doubt, though, unlimited email and the ability to talk to loved ones anywhere and everywhere are pretty MarEx good consolation prizes.

a new era in communications

the maritime executive

maritime training CALHOON MEBA ENGINEERING SCHOOL

The Calhoon MEBA Engineering School is a private educational facility for training members of the Marine Engineers Beneficial Association, as well as all maritime industry professionals. Since 1966, CMES has provided quality training and has worked steadily to develop the necessary courses to satisfy emerging technologies and regulatory training requirements. Since 1977, CMES has been the leader in LNG training for Deck and Engineering officers. Beginning with the operation of the first US LNG carrier and spanning a period of four decades, the MEBA has provided six LNG companies with Merchant officers. CMES continues to provide the training required by regulatory agencies for all officer-billets in today’s modern international LNG industry.