Nicaraguan Canal Construction Delayed

By Mark Edward Nero

The developer hired by the Nicaraguan government to build an alternative to the Panama Canal, Hong Kong-based infrastructure development firm HKND Group, says it needs another year before it can begin constructing the $50 billion project.

The developer, which originally was to begin construction by late 2015, recently said that it needs more time to “fine-tune” the project, the International Business Times reported in late November. HKND was granted the exclusive right to build the canal in 2013.

As the name implies, the Nicaragua Canal is a proposed waterway through Nicaragua to connect the Pacific Ocean with Caribbean Sea and Atlantic Ocean. The 130-mile waterway is expected to take up to 11 years to complete.

It was in June 2013 that the Nicaraguan legislature approved an exclusive commercial agreement with HKND to advance the Nicaragua Canal and Development Project.

The canal is designed to accommodate container vessels up to 25,000 TEUs, super tankers of 320,000 deadweight tons and bulk carriers of 400,000 dwt. The planned project includes the construction of two ports, a free-trade zone and an international airport.

Growth in East-West trade and ship sizes could eventually lead to $1.4 trillion in total goods value transiting the combined Nicaragua and Panama canals, HKND says its own commercial analysis has found.

Seattle Port Approves 2016 Budget

By Mark Edward Nero

On Nov. 24, the Port of Seattle Commission approved its 2016 budget, which includes an estimated $583.4 million in operating revenues and $335.4 million in operating expenses. The budgeted net operating income before depreciation is $248.0 million.

Also, the total capital budget for 2016 is $408.4 million and the five-year capital improvement program is $2.23 billion, which the port said in a statement reflects its “continuing commitment to investing in the development, expansion, and renewal of port facilities that support regional economic activity.”

“This is not a status-quo budget,” Port CEO Ted Fick explained. “This is a growth-oriented budget so we can spur the regional economy, expand opportunities for small and disadvantaged businesses, increase family-wage jobs, help people acquire skills to move up the career ladder, and protect our environment.”

The 2016 budget includes funding major improvements to the Pier 66 cruise terminal. Under a public-private partnership with Norwegian Cruise Line, the cost to renovate the interior of the terminal to accommodate more passengers and improve mobility along Alaskan Way is being shared.

In 2015, the port saw a nine percent increase in cruise passengers this year over 2014, making it a record year with 898,032 passengers sailing via Seattle. Estimates indicate that 2016 will see another 6.8 percent increase.

Each homeported cruise ship that calls at one of the port’s two cruise terminals generates about $2.5 million to the local economy.

The port’s 2016 budget also assumes a levy amount of $72 million, a reduction of $1 million from 2015; the port had held the levy amount constant the past four years adjusting the levy rate downward as property values increased. A typical King County single-family homeowner is expected to pay $82 per year to fund the port in 2016.

An overview of the budget can be seen at http://www.portseattle.org/About/Financial-Info/Budget/Pages/default.aspx

BC Ferries Receives Vessel from Seaspan

By Mark Edward Nero

BC Ferries, the contract service provider responsible for ferry service along coastal British Columbia, has officially taken ownership of a new cable ferry, the Baynes Sound Connector. The vessel’s title was transferred from Seaspan’s Vancouver Shipyards in mid-November.

According to BC Ferries, the new cable ferry met or exceeded all contract specifications, during rigorous acceptance trials and testing conducted by Seaspan, including speed and lower fuel consumption compared to the Quinitsa, the vessel currently in service on the route.

“We are very pleased with the new cable ferry’s performance,” BC Ferries’ President and CEO Mike Corrigan said. “In operational trials, the vessel exceeded its maximum design speed of 8.5 knots fully loaded, achieving a speed of 8.7 knots, with crossing times consistent with the Quinitsa.”

“All speeds have been achieved on the designed one engine operation, and the second engine is there for complete redundancy,” Mark Wilson, BC Ferries’ Vice President of Engineering, explained. “The horsepower of one engine is approximately 490, compared to the Quinitsa, which has four engines at 475 horsepower each.”

The trials indicated significantly lower fuel consumption than the current vessel, he added.

BC Ferries says it will now conduct crew training and familiarization over the next eight weeks as the company prepares for full operational service. The Baynes Sound Connector is expected to be in full operational service in early February 2016. BC Ferries says passengers will continue to be served by the Quinitsa until the Baynes Sound Connector goes into service.

SAFE Boats Awarded Interceptor Vessel Contract

By Mark Edward Nero

Bremerton, Washington-based high performance aluminum boat builder SAFE Boats International has been selected by the Colombian Navy/Coast Guard to build its new Type-F Riverine Interceptor Vessel.

Under the contract, SAFE Boats will provide the Colombian Navy/Coast Guard with a state-of-the-art, shallow draft, aluminum high speed intercept vessel designed to provide tactical mobility and support in opposed riverine and littoral environments.

The vessel will perform missions of offensive patrolling, combat drug trafficking, piracy, arms and explosives smuggling and conduct vessel-to-vessel boarding operations to insure the security of commercial shipping lines within Colombia.

The SAFE Boats design has twin Yamaha outboard engines, a tropical climate retractable canopy, forward and aft machine gun mount foundations and a 10 person seating capacity, including shock mitigating seats by SHOXS for five crew members.

The Type-F Riverine Interceptor is air deployable by fixed wing, rotary wing and commercial mover. It’s built with a maximum speed of 37-plus knots and 200-nautical mile range, and has capabilities in austere shallow water environments.

“The Colombian Coast Guard currently has over 20 SAFE Boats in service,” revealed John Hotz, SAFE’s director of sales for Latin America and the Caribbean. “We have worked very close with the Colombian military to understand just how aggressive and remote their missions can be and to develop a boat that will significantly enhance their patrol and interdiction capabilities on the large rivers of Colombia.”

Moose Boats Delivers Police Catamaran

By Mark Edward Nero

Moose Boats, a vessel designer and manufacturer based in the San Francisco Bay Area, has delivered a M2-35 catamaran patrol boat to the Placer County Sheriff's Office in Carnelian Bay, Calif.

The new Marine 6, a 35-foot all-aluminum catamaran vessel with a beam of 13 feet and draft of 34 feet, will replace the Placer County Sheriff's former Marine 6, a 28 foot aluminum monohull vessel which has been in service since 1988.

Propulsion of the new vessel is provided by twin Yamaha 350-horsepower four stroke outboard engines that give the vessel a top speed of 42 knots at 6,200 feet above sea level on Lake Tahoe and 45 knots at sea level.

Also, the cabin interior is outfitted to facilitate emergency medical services and has an enclosed head, a small galley and a work surface.

Other dimensions and equipment include a range of 240 nautical miles; fuel capacity of 240 gallons; and a cruising speed of 30 knots.

The Placer County Sheriff says it utilized California Division of Boating and Waterways funding to assist in the purchase of the vessel, which will have wide ranging duties, including year-round patrol on Lake Tahoe.

“The Marine 6 crew’s primary responsibilities include enforcement of state and federal maritime law and California penal and vehicle codes,” the Placer County Sheriff’s Office said in a statement. “Commonly, you will find the crew conducting boating under the influence investigations, vessel collision investigations and less often, death investigations.”

The crew can also be called to assist with search and rescue operations, locate missing or overdue boaters, provide medical aid and transport, and assist vessels in distress: sinking, mechanical failure, etc., according to the Sheriff’s Office.

POLB Modifying Storage Fee Policy

By Mark Edward Nero

The Port of Long Beach revealed Nov. 20 that in order to increase the speed of cargo moving out of its terminals, it is considering reducing the amount of time import containers can be stored for free on the docks.

Since 2005, the length of time containers can stay on the dock – known as “free time” – has been four days. Beyond that, terminals are charged storage fees. Port officials are proposing changing free time to six shifts – the equivalent of as few as three days – in order to encourage terminals to more consistently operate at night and move imports off the docks faster.

With larger vessels calling on the port regularly, there are more containers at terminals, which inhibits the ability of workers to deliver containers quickly and efficiently.

“Truckers have told us their containers are not always accessible because of fewer evening shifts, and terminal operators want to clear space in their yards while giving their customers enough time to get their cargo,” Port of Long Beach Chief Commercial Officer Dr. Noel Hacegaba explained.

The port says that in the coming weeks, staff will work with all stakeholders to develop a final plan that will be proposed to the Board of Harbor Commissioners for consideration.

“When containers stack up in terminals, it leads to extra handling that makes the process slower for longshore workers, the shippers that depend on them, truckers who move the goods, and ultimately the consumer,” Port of Long Beach CEO Jon Slangerup said. “This approach will keep the system more fluid and help avoid congestion.”

Paper: America Vulnerable to Maritime Coercion

By Mark Edward Nero

While China continues to expand both its naval sea power and its fleet of merchant vessels, the United States has adopted an ‘abandon ship’ policy towards the merchant maritime industry, according to the authors of a new paper on maritime security.

The paper, entitled “Sea Strangulation: How the United States Has Become Vulnerable to Chinese Maritime Coercion,” was released Nov. 19. It highlights the perceived defense risks of a reduced American merchant fleet and the need to improve its capability.

The authors are Capt. Carl Schuster, former Director of Operations at the US Joint Intelligence Center Pacific, and Dr. Patrick Bratton, Associate Professor of Political Science at Hawai’i Pacific University.

In their 28-page document, Bratton and Schuster state that China has the potential to implement a strategy the authors call “Sea Strangulation,” cutting off the supply of critical military and civilian goods.

“China’s growing commercial and military sea power are carefully planned to support one another, giving China the ability to control – or even halt – shipping of essential goods by other nations,” the paper reads in part. “China could severely damage the US economy, threaten our allies, hold our military hostage and deny critical supplies to Americans in locations such as Hawai’i without firing a single shot.” Currently, nearly 30 percent of global trade passes through the South China Sea.

The authors state that in the event of a military conflict with a hostile nation, America’s reliance on foreign-flagged vessels in commercial shipping could become its Achilles’ heel.

If the US were forced to rely on foreign-flagged ships to supply US troops, other nations could refuse to carry such goods, or a growing naval power such as China could blockade crucial supplies for US military forces, Bratton and Schuster speculate.

They also argue that the US should not weaken the Jones Act, which requires US-flagged ships be used to deliver goods between US ports; and that America should strengthen – and possibly expand – the US Merchant Marine.

With a renewed commercial shipping capacity, the US can control its own destiny, they say, but by contrast, an over-dependence on flag of convenience ships belonging to China or other nations “could be worse than inconvenient.”

It could, the authors state, lead to “severe hardships for those who live and serve under the flag of the United States.”

The full paper can be seen at http://www.hpu.edu/CHSS/History/DeptNews/SeaStrangulation11_171.pdf#Read.