Friday, October 22, 2010

CN Inks Forest Product Deal With Western Stevedoring for Vancouver, BC Terminal

Canadian railroad giant CN, Western Stevedoring Company and several forest-products companies have reached a memorandum of understanding for seven-day-a-week unloading services at Western Stevedoring's Lynnterm Terminal at the Port of Vancouver in British Columbia.

The three party agreement among the railway, terminal and forest-products customers is designed to produce a more consistent flow of forest-products traffic through Lynnterm Terminal and help improve supply chain efficiencies at PMV, according to a release by the Canadian National Railway Company, or CN.

Financial details of the deal were not released.

Under the terms of the agreement, CN will provide daily service to Lynnterm Terminal, which, in turn, will guarantee to unload cars seven days per week. The forest-products companies will work with both CN and Lynnterm Terminal to manage inbound traffic flows, according to officials.

"I am pleased that the parties have collaborated on an innovative service plan that will generate productivity improvements and foster growth of traffic through this important Pacific Gateway terminal for forest products and other bulk commodities," said Claude Mongeau, CN president and CEO. "Working together in this manner will enhance supply chain performance."

Tim Chapman, president of the North Vancouver, BC-based Western Stevedoring agreed.
"Western is pleased to have been chosen by CN and our major forest-products shippers to work toward a cooperative agreement to improve the forest-products logistics chain and to define service expectations among the parties," said Chapman.

The 145-acre bulk and breakbulk Lynnterm Terminal features seven berths and eight warehouses comprising a total of more than 875,000 square feet. The terminal is service directly by CN and features 5.6 miles of track providing direct access to warehouse and storage area.

SoCal Port Industry Leaders Oppose Measure D

A coalition of leaders representing Southern California's goods movement industry have joined the fray over a contentious City of Long Beach ballot initiative, warning that Measure D threatens the economic well-being of the Port of Long Beach and the positive economic impact the port has on the region.

Measure D, drafted by Long Beach Mayor Bob Foster and Council member Gary DeLong, seeks to turn over control of all port-controlled oil property and revenues to City Hall. The measure also seeks to change the way an annual port-to-city transfer of port profits is formulated, from 10 percent of net income to 5 percent of gross revenues.

In a release issued earlier this week, the coalition unanimously opposed Measure D, arguing that it "threatens local jobs and will make it more difficult for the Port of Long Beach to hold its position as a premiere international port and solid economic engine for the region."

“Measure D is just a bad idea,” said Dan Meylor, President, Los Angeles Customs Brokers and Freight Forwarders Association. “City politicians put it on the ballot without thinking about the negative impact on the local economy, jobs, or important projects ensuring clean air in the Long Beach Community. It will likely affect the Port’s bond ratings and associated borrowing costs, driving up the cost of every project and program and reducing the number of these that can be accomplished, which in turn will drive discretionary cargo to other ports in the United States.”

In addition to the LACBFFA, the coalition includes the LA/LB Propeller Club, the Pacific Merchant Shipping Association, the Harbor Association of Industry and Commerce, FuturePorts, and the California Marine and Intermodal Transportation System Advisory Council, or CALMITSAC. Members of the various groups represent nearly all the major stakeholders in the Southern California shipping industry.

Much of the groups' concern focuses on the potential for the measure to limit the port's ability to invest in development.

“Measure D could put a halt to the continued economic viability of the Port. Failing to invest in the Port only puts us at a greater disadvantage in the years to come,” stated William Lyte, past president of the Harbor Association of Industry and Commerce.

Lyte's concerns were echoed by Sue Dvonch, Vice President, Propeller Club of Los Angeles-Long Beach.

“Those involved in international commerce play a vital and important role in our state’s economic structure, and they are concerned that Measure D will threaten California’s position as a leading global gateway and will negatively impact our economy should we fail to adequately invest in our state’s transportation infrastructure.” said Dvonch.

Long Beach Mayor Foster has argued that the ballot measure is meant to clarify language in the City Charter and is not an attempt to take more money from the port. Despite no analysis being conducted to determine the future financial impacts of the measure, Foster has maintained that the fiscal impacts to the port will be minor.

However, a study conducted by port staff prior to the announcement of the ballot measure estimated that the port expected to make $120 million in oil revenues from existing wells between 2010 and 2014. This would mean, if Measure D is approved by voters, that an average of $24 million a year will be diverted from the port to City Hall coffers.

In addition, based on the net and gross revenues of the port over the past ten years, the city stands to receive an average of $3 million more per year via the annual transfer under the "5 percent of gross" formulation proposed in the ballot measure.

A recent PMM Online analysis found that the long-term impacts of Measure D could include: threats to the port's exceptionally positive bond credit rating; impacts to the port's timely investment in infrastructure; the possibility of increased cargo diversions; and, threats to the autonomy of the port from city politics.

A recent poll of likely Long Beach voters conducted by Research found that 36.6 percent of Long Beach voters oppose the measure, 27.7 percent favor the measure and 35.7 percent are undecided.

Guam Port Celebrates 35th Anniversary

The commercial port of Guam celebrated its 35th anniversary this week, with five days of celebrations and ceremonies marking the formation of the Port Authority of Guam.

The celebrations began Monday with a flag-raising ceremony and will conclude Friday with an awards banquet.

The United States government turned over the port to the island nation in 1966 but it was not until 1975 that the autonomous PAG, which oversees the port's operations, was formed.

During the past 35 years, little of the port's technology or infrastructure has been upgraded – a problem being addressed by a more than $260 million PAG port development plan.

The modernization plan received a sizable boost on Sept. 25, 2010 when the United States Defense Department appropriated $50 million to PAG – the first major source of funding obtained for the project.

The PAG has cited the federal funding as critical to kick starting the modernization plan to upgrade the island's commercial port infrastructure. The most critical need for the upgrades is to deal with the anticipated increases in cargo from an impending relocation of U.S. military operations on the Japanese island of Okinawa to Guam. The military buildup will see more than 8,000 Marines, their operations and more than 9,000 military dependents shift from Okinawa to Guam by 2014. The buildup is set to begin later this year.

The first phase of the modernization plan is expected to cost just over $100 million and focus on critical waterfront infrastructure and equipment upgrades at the port. The PAG also plans to use the $50 million in Defense Department funds to secure an additional $50 million loan for port upgrades from the US Department of Agriculture.

Three West Coast Ports Awarded $40 Million in Fed Construction Grants

Three United States West Coast ports have received a total of nearly $40 million in capital project grants from the second round of federal Transportation Investment Generating Economic Recovery program funding, or TIGER II.

The three West Coast projects, at the ports of Los Angeles, Coos Bay, and Vancouver USA, are part of 42 construction projects and 33 planning projects in 40 states approved by the US Department of Transportation to share in nearly $600 million in grants being offered in TIGER II funding.

The Port of Los Angeles will receive $16,000,000 to construct an intermodal railyard, which includes staging and storage tracks connecting on-dock railyards with the Alameda Corridor, as part of the port's West Basin Railyard project.

The Oregon Port of Coos Bay will receive $13,573,133 to rehabilitate the track structure of the 133-mile Coos Bay Rail Link, which closed in 2007 as a result of deferred maintenance.

The Washington-state Port of Vancouver USA will receive $10,000,000 to help complete construction of a new rail access route to alleviate rail traffic congestion at the port.

The TIGER II grants grew out of the original TIGER grant program that sought to invest in U.S. highway, transit and goods movement infrastructure projects as part of the American Reinvestment and Recovery Act. During the first round of TIGER funding, port projects received only 8 percent of the $1.5 billion in available grants. In the TIGER II funding, a total of seven port projects will receive a total of nearly $95 million in grants, or about 17 percent of available funds.

Wednesday, October 20, 2010

WTIV Market Expanding Rapidly

In something of a surprise within the world’s shipbuilding industry South Korea’s Daewoo Shipbuilding & Marine Engineering Co., currently ranked as the globe’s second-largest shipbuilder, indicated in August that it plans to generate 30 percent of its sales from wind power by 2020. “It’s a very ambitious target and it won’t be easy,” said the company’s Chief Strategy Officer, Koh Young Youl. “Still, the market potential for wind power is very big, partly because there’s a lot of interest in going offshore as the space on land runs out.” Daewoo, which is building two Wind Turbine Installation Vessels (WTIVs) for Germany’s RWE Innogyl group, expects to generate about $25 million from wind-power sales this year, and possibly as much as $800 million by 2012. However, Koh said that figure could go as high as $7.5 billion by 2020. Daewoo, which already manufactures turbines in South Korea, may also open a turbine factory in China as well as move into wind farm development worldwide. “It is our plan to eventually be able to provide a full chain of services for wind energy – from making turbines to operating mills,” Koh said. Although most offshore wind farms are being built in northern Europe, Koh said China plans to install a wind generating capacity of 100 gigawatts by 2020 to help it reduce its dependency on fossil fuels. To get a lead on wind technology development, Daewoo recently bought DeWind Inc. from Irvine, California-based Composite Technology Corp. and may start building wind turbines at its shipyard in Romania for the rapidly growing European wind market.

Daewoo Duo
The new WTIVs that Daewoo is building for RWE Innogyl are only two of a rapidly growing number of WTIVs being ordered or planned worldwide. The Daewoo-built ships, to measure 109 meters by 40 meters, will be jack-up type self-propelled vessels that will be able to transport four multi-megawatt turbines in a single voyage plus perform installation work in water depths of more than 40 meters. They are costing about $127 million each to build and will be fitted with a DP 2 class positioning system that will make use of six retractable thrusters of 1,600 kW output each. This is expected to provide exceptional on-station maneuverability as well as a transit speed of about 7.5 knots. RWE Innogyl plans to use the twin ships to build two offshore wind farms in the German area of the North Sea area, one of 295 MW capacity and the other of 960 MW capacity, as well as a third farm of 576 MW capacity off the coast of Wales in the United Kingdom.

Samsung Series
Another South Korean builder, Samsung Heavy Industries, has been contracted by Swire Pacific Offshore Operations of Singapore, part of Great Britain’s John Swire & Sons Limited, to build an WTIV capable of operating in depths up to 75 meters. Swire has taken an option on a second WTIV of similar capacity, with the first to be completed by June 2012 and the second, if ordered, in 2013. Both jack-ups will be for Swire’s new Denmark-based subsidiary, Swire Blue Ocean, which was created earlier this year following Swire’s purchase of Copenhagen-based Blue Ocean Ships. The Samsung-built WTIVs will each have a crane capacity of 1,200 tons, be equipped with DP2 positioning, and have single cabin accommodation for up to 111 people. Usable deck area for the 13-knot vessels will be in excess of 4,000 square meters with a total jackable weight of not less than 8,400 tons.

Singapore Seafox
Being built in Singapore by the Keppel FELS shipyard is a WTIV ordered by Seafox of the Netherlands to be delivered in the second half of 2012. This Jack-up type vessel is costing Seafox $220 million to build and will be managed and operated by WorkFox BV, a new subsidiary set up as a joint venture between Keppel and Seafox. Under the venture’s signed agreement, Seafox will have the option of purchasing all of Keppel’s shares in the future. The new WTIV will be christened Seafox 5 and will be able to carry up to 12 turbines at a time while installing them at depths of up to 65 meters. Because of the vessel’s configuration and construction it will also be able to support activities in the offshore oil and gas industries, offering a deck area of 3,500 square meters and a variable deck load capacity of 6,500 tons.

MPI Offshore
Following its recent purchase of Stokesley, UK-based MPI Offshore, Vroon of The Netherlands has gone to China for its next two WTIVs, both to be operated by MPI. The vessels are being built by the Cosco Nantong Shipyard and have been loosely based on the design of the world’s first WTIV, Mayflower Resolution, which MPI acquired in 2004 following the bankruptcy of the ship’s original owner, Mayflower Energy. The two new WTIVs will be slightly larger than the original WTIV, measuring 137 meters by 40 meters, and will have a number of other enhancements. These will include a much larger construction crane of 1,000 tons lifting capacity at 25.5 meters as well as more accommodation and enhanced jacking and positioning capability. Rotterdam-based Gusto MSC will supply the vessels’ jack-up systems and cranes while their engines and thruster systems will be delivered by Great Britain’s Rolls Royce. The total investment for both 12.5-knot ships is expected to be around $550 million, with delivery and commissioning scheduled for the first and third quarters of next year.

Also going to China for a new WTIV is Denmark’s A2SEA which has signed a contract with the COSCO Shipyard Group for a 132 meter by 39 meter ship at a cost of $139 million. A2SEA already operates four vessels capable of wind turbine installation and has installed more than 60 percent of all offshore wind turbines to date. The newbuilding, to be delivered in late 2012, will be a jack-up type with a capability to operate in water depths of up to 45 meters while carrying eight to ten wind turbines. To be named Sea Installer, the 12-knot ship will have accommodation for 60 people, a loading area of 3,200 square meters and a load capacity of 5,000 tons. Although A2SEA is owned by DONG Energy of Denmark, Siemens of Germany is preparing to make a substantial investment in this company, which should be completed before the end of the year.

Olsen Windcarrier
Going to the Middle East for new WTIV construction is Fred. Olsen Windcarriers AS, part of Norway’s Olsen Group. Windcarriers AS has ordered a 131-meter by 39-meter WTIV from Lamprell plc of the United Arab Emirates (UAE), well known for its oil rig work. The new ship will be of the Gusto MSC NG-9000 design and will be capable of carrying up to 10 wind turbines on deck. Installation work will be carried out using a 800-ton revolving crane to be incorporated in one of the vessel’s four jack-up leg mounts. Power and propulsion will be provided by four Wärtsilä generating sets to include one 6-cylinder, two 9-cylinder and one 12-cylinder unit, all based on the Wärtsilä 32 engine. A transit speed of 12 knots will be furnished by three Voith Schneider Propellers (VSP) while maneuverability will be enhanced by three forward mounted tunnel thrusters. The first of the Olsen WTIVs is expected to be completed by mid-2012 while the second should follow before 2013.

Beluga Hochtief
Moving into the turbine installation business but not yet ordering ships is Beluga Hochtief Offshore, a new venture formed by German heavylift shipping specialist Beluga Shipping and Essen-based Hochtief, a large construction and engineering firm. The WTIVs proposed by Beluga Hochtief will be of the jack-up type, with each ship to measure 147 meters by 42 meters and carrying a rotating crane with a lift capacity of up to 1,500 tons at 31.5 meters. Like several other WTIV designs the vessels will incorporate four lattice-style legs and a rack and pinion jacking system with a jacking speed of 1-meter-per-minute. Accommodation will be provided for 120 workers, to include the ship’s crew, while a landing deck will be fitted capable of handling Sikorsky S92 type helicopters. Although a propulsion system has yet to be announced, the WTIVs would comply with DP2 requirements and have a service speed of about 12 knots. Cargo capacity would be 8,000 tons, which translates to about 7 wind turbine generators of up to 6MW output.

Ulstein X-Bow
Proposing a radically new design for WTIV construction that would do away with the jack-up method is Norway’s Ulstein group, which has developed two new concepts for turbine installations: the Windlifter system and the F2F (floating to fixed) concept. The Windlifter would be a dynamically positioned X-Bow vessel that would transport four turbines at a time and use a modular, mechanical system rather than a crane to move the turbines onto their foundation blocks. According to Ulstein, this would result in a considerable reduction in power demand as well as a quicker installation time. However, the modular “clamp and skid” system, as proposed by Ulstein, has yet to be proven in actual operation. Looking beyond fixed foundation installations, Ulstein has also drawn up its F2F concept, which would make use of semi-submerged floating turbine platforms. Based on proven technologies from the offshore oil industry, the F2F wind turbine units would be constructed and commissioned inshore, then towed to offshore locations using tugs or OSVs. As the turbine units would float in the water they would not require sophisticated installation vessels. In addition, their decommissioning would leave no remains on the sea floor, which would not be the case for foundation units.

Service Vessels
Both the foundation-based and floating turbines would require annual maintenance and several builders, including Ulstein, have come up with new designs for service vessels. Ulstein has already signed a letter of intent with SeaEnergy Marine of Scotland to develop a new class of service vessel that would be based on Ulstein’s existing SX128 design. These X-Bow vessels would incorporate ship-based self-stabilizing platforms developed by Ampelmann of The Netherlands to allow maintenance workers to move between ship and turbine. Australia’s Austal group, well known for its high-speed catamaran ferries, has put other less sophisticated maintenance vessel designs forward. The Austal vessels would come in three sizes measuring 17.5 meters, 19.3 meters and 28.5 meters in length. The two smaller lengths would have an operational deadweight of 10 tons, a range of 330 nautical miles and a speed of nearly 26 knots utilizing a catamaran hull. The larger 28.5-meter lengths could be ordered with either a catamaran or an Austal-developed Tri-SWATH hull, with the latter having a better seakeeping ability in rough water. These craft would have a deadweight of 20 tons and be capable of carrying up to 52 passengers at a speed of better than 26 knots.

Winter Work Term Wanted

Students of Webb institute are starting to plan where they will spend their Winter Work term. The freshmen will be heading out to shipyards, the sophomores will spend their time onboard ships, and the juniors and seniors will look for work in engineering offices in the United States and abroad.

If your company has internships for January and February, please contact Josie Wilson by email at or by telephone 516-671-2213 Ext. 108 and she will get the word out to the students. Josie will be contacting shipyards and shipping companies in the next few weeks for the freshmen and sophomores. If you are working in a yard that you believe will have a very interesting experience to introduce to the freshmen, please contact Josie. Webb is also always on the lookout for new seafaring adventures for its students and welcomes any berths aboard ships that will fulfill the sophomore sea term requirements. -PMM Staff

Update of Long Beach Port Volume Numbers

In the Friday, Oct. 15 edition of PMM online, we reported several September cargo volume numbers and percentages for the Port of Long Beach as posted on the port website. These numbers have since been updated. The complete and final September numbers for the port are:

The Port of Long Beach reported handling a total of 574,790 TEUs in September, a 30.5 percent increase over September 2009. The port handled 288,905 loaded inbound TEUs for the month, a 28.4 percent increase, and 124,021 loaded outbound TEUs, a 13.4 percent increase over volumes reported in September 2009.

PMM Online apologizes for any inconvenience this may have caused.

Seattle Port Volumes Continue to Climb, Tacoma Returns to Negative Growth

Cargo volumes at the two major domestic Puget Sound ports returned to moving in opposite directions in September, with Seattle up double digits and Tacoma moving into the negative once more.

The Port of Seattle moved a total of 177,870 TEUs in September, a 22.1 percent increase over September 2009. Port officials reported handling 78,564 loaded inbound TEUs, a 32.8 percent increase over the year-ago period. The port also handled 43,536 loaded outbound TEUs, a 2.0 percent increase over the same month last year.

The Port of Tacoma, after experiencing its first month of positive numbers in nearly two years during August, fell again into the negative for September. The port handled a total of 139,732 TEUs during September, a 4.6 percent drop compared to September 2009. The port handled 49,718 loaded inbound TEUs, a 6.6 percent decline over the year-ago period and 31,587 loaded outbound TEUs, an 18.1 percent drop compared to September 2009.

California Seeks to Expand Low-Sulfur Fuel Zone Along Coast

California air regulators have put forward their plan to stop cargo vessels from avoiding the main coastal shipping route between the Channel Islands and the Santa Barbara/Ventura coast and skirting through a US Navy missile range on the west side of the Channel Islands.

Captains are taking the outer route to avoid a California Air Resources Board regulation requiring vessels within 24-miles of the coast to burn more expensive low-sulfur fuel. The Navy reports a nearly seven-fold increase in the number of vessels using the outer route and transiting through the Pt. Mugu Sea Range. The range sits mainly in international waters outside of the 24-mile CARB limit. The vessel traffic is a safety concern to the Navy, which conducts test almost every day of the year at the range, and raises the potential for disrupting missile tests.
CARB also said that the vessels taking the outer route are impacting anticipated emission reductions that were predicted to be achieved by the regulations.

CARB is now proposing to extend the 24-mile zone from the Channel Islands instead of the coast, thus placing the outer route through the missile range within the low-sulfur fuel zone. To give vessels incentive to take the coastal route, the proposed plan would also create a "window" in the northern approach area that would not be subject to the low-sulfur regulation.

The main goal of the proposed plan, according to CARB, is to recapture the emission reductions being lost as vessels take the outer route through the missile range, and to reduce traffic moving through the missile range. CARB believes that expanding the 24-mile low-sulfur zone to fully encompass the outer route will eliminate the economic incentive for vessels to deviate from the main shipping routes along the coast.

CARB estimates that vessels using the outer router typically save about $3,000 in fuel costs but experience an extra hour of transit time. By taking advantage of the northern approach "window" and using the main shipping route along the coast, CARB estimates that vessels could save $400 or more on fuel costs and shave their transit time by an hour.

Currently, about 50 percent of the vessels heading to the Southern California ports of Long Beach and Los Angeles utilize the Channel Island routes.
CARB will be holding an additional workshop on the proposal early next year. A decision is not likely until at least March, when the CARB board is set to discuss the issue.

Los Angeles Port Taps New Environmental Chief

The Port of Los Angeles has named Christopher Cannon as its new Director of Environmental Management.

Cannon, a more than 20-year veteran of the environmental services industry, has worked at the Port for several years as a consultant--most recently helping to manage the implementation and daily operation of the port's Clean Truck Program. Cannon fills the position vacated by Ralph Appy, who retired earlier this year.

In his new role, Cannon will oversee the Environmental Management Division, which assesses environmental impacts of port development projects and determines appropriate mitigation measures. The division also prepares and distributes any environmental documentation mandated by state and federal law; special studies involving dredging, noise abatement, water quality and air quality; contamination characterizations; wildlife management; and establishment of policies regarding environmental quality issues.

Prior to consulting on the port's truck program, Cannon worked with the port's Environmental Management Division’s Air Quality and CEQA groups, supporting the development of key air projects such as the Clean Air Action Plan and its efforts to complete critical environmental impact reports for port-related projects. Cannon previously served with ENVIRON International Corporation and TRC Environmental Solutions.