Friday, May 30, 2014

New Port of LA Executive Director Chosen

By Mark Edward Nero

On May 27, Los Angeles Mayor Eric Garcetti nominated Gene Seroka, an executive with APL shipping line, as the next Executive Director of the Port of Los Angeles.

The port’s Board of Harbor Commissioners will consider the nomination of Seroka during its June 5 meeting. The nomination is also subject to confirmation by the Los Angeles City Council.

“I’m confident that Gene will be a strong leader who will enhance our international trade agenda, increase reliability and efficiency through effective management and labor relations, and ensure our port is a sustainable and positive neighbor to the Harbor community,” Garcetti said.

Seroka is currently Head of Commercial in the Americas Region for APL, which is a subsidiary of Singapore-based Neptune Orient Lines (NOL), and the world’s seventh largest ocean carrier. He has led more than 1,000 employees and all of APL’s Sales and Operations activities in North, Central, and South America and managed sales for the company’s liner shipping as well as overseeing its four US marine terminals and intermodal operations throughout the geography.

“I’m thrilled that Mayor Garcetti has tapped me to lead the Port of Los Angeles,” Seroka said in a statement released by the port. “I look forward to focusing our operations to provide world-class customer service while continuing to invest in a healthy and vibrant harbor community.”

Before becoming Head of Commercial for APL, he was Vice President, Middle East and East Africa, based in Dubai, for NOL group from April 2008 to April 2010. From October 2005 to April 2008, Seroka was Vice President of APL Logistics Ltd. in Singapore.

“Gene Seroka is uniquely qualified to lead the Port of Los Angeles,” Harbor Commission President Vilma Martinez said. “His maritime and global commerce expertise, leadership skills, and strategic vision are exactly what we need.”

The nonprofit, independent trade group the Pacific Merchant Shipping Association applauded the selection of Seroka.

“Gene has extensive experience within the maritime industry and is greatly respected by all segment of the international trade community,” PMSA President John McLaurin said. “The May of Los Angeles and the Harbor Commission are to be congratulated for conducting a transparent, thorough and methodical search and hiring such a talented individual.”

Seroka replaces interim Executive Director Gary Lee Moore, who has served in the role since October 2013. He replaced Geraldine Knatz, who retired after a 36-year career in the maritime industry, including the last six as the Port of LA’s executive director.

Garcetti said Moore will now go back to his position as City Engineer of the City of Los Angeles, where he is responsible for the city’s public infrastructure network.

Port of Everett Receives Presidential Award

By Mark Edward Nero

US Secretary of Commerce Penny Pritzker presented the Port of Everett with the President’s “E” Award for Export Service during a ceremony in Washington, DC on May 28. The “E” Awards are the highest recognition a US entity can receive for making a significant contribution to the expansion of American exports.

The Port of Everett, located 25 miles north of Seattle, is a natural deep-water port that specializes in handling over-dimensional, high value cargoes for the construction and manufacturing industries, and is a link for the local aerospace industry transporting the parts for the 747, 767 and 777 jetliners.

In addition to aircraft parts, the Port of Everett transports heavy equipment, machinery and mining equipment manufactured primarily by Midwest companies. The cargo is transported to the port mostly by rail.

“The Port of Everett has demonstrated a sustained commitment to export expansion. The ‘E’ Awards Committee was very impressed with the Port of Everett’s commitment to finding unique solutions for logistics challenge in exporting oversized equipment,” Pritzker said in a congratulatory letter to the company announcing its selection as an award recipient.

According to the U.S. Customs and Foreign Trade Division, the Port of Everett is ranked first in Washington State for export value at $22.7 billion in 2013, making it fourth on the West Coast in export value behind the ports in Los Angeles, Long Beach and Oakland.

“The Port of Everett is a national strategic asset that plays a critical role in achieving the President’s goal of doubling exports by 2020,” Port of Everett Executive Director John Mohr said in a prepared statement. “The Port of Everett is not a throughput port, but rather a value port. We focus our operations very specifically on supporting the aerospace, construction, manufacturing and energy industries.”

The “E” Awards were established in 1961. US companies are nominated for the award through the Department of Commerce’s US and Foreign Commercial Service office network. A total of 64 US companies were presented with the President’s “E” Award this year, as well as two ports, Everett and the Port of Maryland.

Seattle Port Launches Truck Replacement Program

By Mark Edward Nero

The Port of Seattle and the Puget Sound Clean Air Agency on May 27 launched the drayage truck scrapping and replacement program ScRAPS 2 (Seaport Truck Scrappage and Replacements for Air in Puget Sound).

The program’s goal is to help truckers calling on Port of Seattle terminals to have model-year 2007 or newer engines, or meet 2007 federal emissions standards, which are aimed at reducing air emissions from port-related activities.

The program, partially funded by federal and state grants, is expected to provide up to $20,000 to owners who scrap old drayage trucks and replace them with trucks with model-year 2007 or newer engines. The current level of funding is expected to provide incentives for about 180 trucks.

“We’re happy to report that truckers are successfully signing up for the program,” Stephanie Jones Stebbins, Seaport Environmental and Planning Director at the Port of Seattle, said. “The Port of Seattle put a lot of work into reaching out to the trucker community to ensure they understood the process and were able to apply.”

The project is expected to run through mid-2015 or until funds are depleted. The port also says it is investigating other financing and assistance programs to help truck owners meet the Clean Truck Program requirements.

“ScRAPS is a proven model of success in helping truck drivers upgrade to newer, less-polluting engines,” Andrew Green, Director of Air Quality Programs at the Puget Sound Clean Air Agency, said, remarking that to date, scrappage rebate programs throughout the region have removed more than 400 dirty trucks from our roads.

More information on ScRAPS 2 is available at

Towing of Ultra-Large Containerships Tested

By Mark Edward Nero

Shipping group CMA CGM partnered with Coast Guard Sector San Francisco and other local industry partners recently to test the Bay Area’s capability to tow ultra-large container vessels.
During a May 22 exercise, the CMA CGM vessel Centaurus, an 11,400 TEU containership measuring about 1,200 feet was used to test the capability of existing tug assets within San Francisco Bay to connect to and tow an ultra-large container vessel.

The demonstration was intended as a learning experience to enhance preparedness for emergency towing operations either in the San Francisco Bay or in the approaches to San Francisco.

This exercise marked the first such attempt in the United States, according to the Coast Guard. Among the participants were AmNav Maritime, Foss Maritime and Harley Marine Services.

“This is a prime example of the forward-leaning posture of the San Francisco Bay Area Harbor Safety Committee and a testament to the commitment of our maritime community to safety and environmental protection,” Capt. Gregory Stump, commander of Sector San Francisco and captain of the Port of San Francisco said.

“There will be many important lessons learned from this exercise,” Coast Guard Cmdr. Jason Tama with the 11th Coast Guard District prevention division predicted. “It was a great example of the Coast Guard, Harbor Safety Committee, and maritime industry working together to ensure we are ready to respond to an incident involving an ultra large container vessel.”

Tuesday, May 27, 2014

The Logistics of Powering Industry Offshore with Clean, Economical LNG

By Greg Buffington

Crowley Maritime Corporation, through its wholly owned subsidiary, Carib Energy, has begun to transform how industrial companies in the Caribbean and Central America can power their facilities more economically and in a more environmentally friendly way. In September 2014, Crowley will begin delivering Liquefied Natural Gas (LNG) to industrial companies in Puerto Rico and the Caribbean, allowing these companies to become energy self-sufficient and gaining independence from their current utility providers, which typically use inefficient, costly and high-polluting fuels. The changeover to LNG for their boilers and power generation will afford customers, in most cases, the opportunity to reduce energy costs, which in turn will allow for investment in new, greener and more efficient equipment. Many customers are choosing to become independent of the electrical grid by installing Combined Heat and Power (CHP) as well as replacing high cost #2 diesel and dirtier #6 diesel with LNG, a more environmentally friendly solution for their energy plants.

Crowley acquired Carib Energy in May 2013, as both a strategic step into LNG and as a way to expand its growing petroleum and energy business. Florida-based Carib Energy, founded in 2010, was the first company to receive a small-scale, 25-year, LNG export license from the US Department of Energy (DOE). The permit allows for 140,000 metric tons of LNG transportation from the US into Free Trade Agreement (FTA) countries in the Caribbean and Central America. Carib Energy also has a pending application with DOE that would allow for Non-FTA exports of 365,000 MT. If granted, this license will also span 25 years.

Crowley, through its long-standing liner shipping and logistics business units, has established a logistical, maritime pipeline of natural gas flow from the U.S. to Caribbean and Central America industrial customers using US-sourced natural gas from the country's abundant, low-cost supplies.

As such, Crowley has recently announced the signing of a multi-year contract with Coca-Cola Bottlers of Puerto Rico to supply containerized, US-sourced Liquefied Natural Gas (LNG) to two of the manufacturer's plants in Cayey and Cidra, Puerto Rico. Carib Energy is also in negotiations with several other potential industrial customers that will soon convert to LNG in Puerto Rico and US Virgin Islands.

LNG is not a new fuel, having been in existence for more than 97 years, with the first US patents awarded in 1917. LNG is produced when pipeline natural gas is put through a cryogenic process that condenses the gas into a liquid form by taking the gas to -260F (-162C). It is in this liquefied form that Carib Energy can fill DOT ISO –IMO75 LNG containers to a capacity of 10,700 LNG gallons. The specialized LNG Tanks that Carib Energy has purchased will hold the LNG in a liquid state for 60 days from the time it is filled without any boil off which could cause a discharge. This is contrary to the large flat bottom tanks at the import terminals that have boil off that they must discharge daily.

In simplest terms, these LNG tanks act like a giant thermos bottle. There is a stainless steel inner tank that's wrapped with multiple layers of super insulation before being put inside a carbon steel tank, welded closed, and vacuum sealed. The vacuum process takes up to a week to pull all oxygen out of the void between the inner and outer tanks. This void area is the barrier that keeps the heat from the outside away from the inner tank holding the LNG. This allows the LNG to stay in this cold state without any possible build up greater than 70 psi, which would cause a discharge from the relief valves and a loss of LNG. In the event there ever was a discharge, the gas, which is lighter than air, would simply rise and quickly dissipate into the atmosphere.

The Crowley supply of LNG will come from existing utility peak shaving in the southeast and new, merchant LNG plants being built in northern and southern Florida by 2016. The LNG is produced, loaded and trucked in the LNG tanks from the liquefaction facilities for 240-400 miles before reaching Crowley's Jacksonville and Fort Lauderdale, Florida cargo terminals. The LNG ISO tanks will then be loaded and segregated in proper hazmat locations on Crowley vessels for transportation to Puerto Rico and other Caribbean islands, which will take three to six days. Once the vessel arrives at its destination port, the LNG tanks will be off loaded into designated areas to hold until Crowley's logistics group dispatches them to the customer's location.

Crowley customers will utilize multiple 15,000- to 18,000-gallon LNG vertical storage tanks at their plants depending on their daily volume consumption. They will also have onsite a regasification and pressure regulation skid and cryogenic LNG offloading pump. The LNG tank will be dispatched through daily remote monitoring of the LNG storage tanks, and with criteria and parameters that have been predetermined.

Crowley's logistics group will then pick up the LNG tank from its designated storage area at the port and have it driven to the customer's location. All drivers will go through training and certification according to DOT Hazmat regulations to certify they can carry an LNG container over road. Each driver will also carry a Crowley card that will identify this particular driver as holding certification to transport as well as certification to properly unload and discharge the LNG from the tank to the vertical on-site storage tanks.

The LNG tanks and the vertical tank installations are very clearly marked with complete instructions in both English and Spanish to ensure the drivers are able to follow complete and accurate instructions.

Once the driver does a complete discharge of the LNG, he will then close down all of the systems and give proper delivery documentation to the customer before returning to Crowley's port with the empty LNG tank. At that time, the ISO LNG tank will be placed on a northbound vessel and returned to Jacksonville where it will be driven to the LNG liquefier, refilled again and rotated back to the port. The average time for the complete rotation from fill to return to the liquefier is an average of 19 days.

To assure that customer's LNG needs are always met, Crowley will keep a 20 to 25 percent "safety stock" of full, LNG containers which can be made available in the event of a consumption increase or delay so customers do not experience an interruption of service.

The challenge for any company in the business of moving LNG in ISO tanks is the flange-to-flange logistics of inland, ocean and island movements in a timely manner to keep the flow of LNG constant to the customer. Crowley not only has the expertise but also the available assets in the U.S. and throughout the Caribbean and Central America to make this a successful business, while presenting savings and a greener energy alternative for customers.

Greg Buffington, who has more than 30 years of experience in the gas industry, was previously the founder and President of EFG Industries, a gas equipment distribution and LP Gas plant construction company. In 2010, he became the founding partner of Carib Energy, a company created to help move customers into a more friendly and more economical fuel. He can be reached at

US Congress Approves Water Resources Legislation

By Mark Edward Nero

The US Senate on May 22 voted 91-7 to approve $12.3 billion legislation that authorizes spending on infrastructure projects to boost US ports and waterways. The House of Representatives approved the same bill on a 412-4 vote earlier in the week.

The approval by both chambers of Congress now means that the bill, HR 3080, commonly known as the Water Resources Reform & Development Act of 2014, now goes before President Obama, who is expected to sign the bill into law.

The bill, which is the first major US waterways legislation in seven years, authorizes 34 projects across the country, including dredging at the ports of Long Beach and Los Angeles.

The measure identifies more than $12 billion worth of new water infrastructure projects, particularly on the East Coast and in the South, and authorizes funding for them, including flood protection, ecosystem restoration and maintenance of ports and navigation routes for commerce and the movement of goods.

“The Water Resources Reform Development Act makes an important advancement toward a more equitable allocation of harbor maintenance dollars,” Port of LA Interim Executive Director Gary Lee Moore said in a prepared statement provided by the port. “The customers of the Port of Los Angeles are the single largest contributor to the Harbor Maintenance Trust Fund, so we’re pleased to see the bill expand uses to fund port maintenance projects.”

In addition to authorizing crucial port projects, the bill reforms the Harbor Maintenance Trust Fund to increase port investment. Despite significant maintenance needs at some US ports, only roughly half of the taxes collected in the Harbor Maintenance Trust Fund each year are actually used for port maintenance activities.

The legislation calls for full expenditure of all revenues collected in the Trust Fund by 2025.

Vigor Absorbing Oregon Iron Works

By Mark Edward Nero

Vigor Industrial has announced that it is merging with specialty manufacturing firm Oregon Iron Works and that OIW will become a wholly owned Vigor subsidiary. OIW and Vigor say they agreed to terms on May 20 and expect the merger to be finalized before the end of June.

“I’ve spent the last 40 years building Oregon Iron Works into a company with some of the country’s most advanced fabrication capabilities, and we’ve been looking for ways to evolve to the next level and compete in a broader market spectrum,” Terry Aarnio, OIW Chairman of the Board, said in a May 21 statement regarding the transaction. “Vigor builds and repairs ships. OIW builds boats and other projects with complex fabrication, machining, and integration requirements. 
Vigor has some of the West Coast’s largest shipyard industrial facilities and great marine industrial workers.”

OIW’s unique fabrication abilities combined with Vigor’s shipbuilding, heavy lifting and marine launch capabilities is expected to allow the company to complete large-scale, complex projects that neither company could do alone, according to the two companies.

“This combination positions the company to meet upcoming demand from various industrial and marine sectors,” Vigor CEO and Owner Frank Foti said. “Not only will diversification allow us to better weather the ups and downs of the marine industry, incorporating good fabrication genetics from non-marine sectors is great way to achieve world-class shipbuilding standards in the US.”

“It’s industrial evolution, and it’s what our economy needs,” Foti said. “We’re doing everything we can to build and sustain family-wage industrial jobs.”

The combined company is expected to employ about 2,300 people in Alaska, Oregon and Washington.

PMSA Wins Public Records Lawsuit

By Mark Edward Nero

The San Francisco Superior Court granted the Pacific Merchant Shipping Association a significant victory on May 23 when it awarded the PMSA more than $260,000 in attorneys’ fees and costs against the State of California as a result of a Public Records Act lawsuit.

The PMSA had been seeking records documenting pilot assignments on the San Francisco Bay, and the Superior Court declared that PMSA’s case established that the Port Agent is a public official subject to the Public Records Act and that, as a result, the records he uses regarding the working hours and rest periods of the state-licensed pilots who navigate vessels in and around the San Francisco Bay must be made public.

“Our goal is to ensure that cargo vessels are safely and legally navigated in the San Francisco Bay, and for this to happen we need transparency and accountability in our state pilotage system,” PMSA General Counsel Mike Jacob said. “When assignment documents are made public anyone can see when state-licensed pilots are dispatched to ships, evaluate pilots’ actual working conditions, independently confirm pilots’ work hours, or verify minimum rest period violations. We are pleased that as a result of this action we have ensured the public’s right to access records used by the Port Agent and that the Superior Court has vindicated our efforts.”

The original case was filed in July 2012 in San Francisco Superior Court.

“Our efforts were supported by the ACLU, the California Newspapers Publishers Association, First Amendment Coalition, LA Times and McClatchy newspapers,” PMSA President John McLaurin told Pacific Maritime Magazine Online via email.

Port Metro Vancouver Planning Terminal Expansion

By Mark Edward Nero

Port Metro Vancouver says it will investigate design options to expand its Centerm container terminal to help address an anticipated shortfall in future container capacity.

Centerm, operated by Dubai-based marine terminal company DP World, is one of three primary container terminals located within Port Metro Vancouver, and handles about a fifth of the port’s annual container cargo.

In a May 16 statement regarding the matter, the port said design options will be determined over the next year, and that it is committed to a “fulsome consultative process with the community and other stakeholders” prior to finalizing the design for Centerm expansion.

The project, to be built in cooperation with DP World, is expected to cost at least $250 million, with construction proposed to begin in late 2016.

Trade to and from Canada, especially with Asia, is growing. Forecasts have shown that container traffic on Canada’s West Coast is expected to double over the next 10 to 15 years. The port says that even with new capacity at its Deltaport terminal and planned expansion in Prince Rupert, the ability to accommodate more containers on the west coast of Canada still needs to increase by the early 2020s.

As such, Port Metro Vancouver says it is actively pursuing options to maximize existing infrastructure and develop new capacity.