Eyes of the Fleet

Eyes of the Fleet

Thursday, June 19, 2008

Want more offshore oil and gas drilling? Then you need more ships...and sailors

As set out at Shortage of Ships May Complicate Call for Offshore Drilling:
The New York Times reported that a shortage of ships used for deepwater offshore drilling may impede any rapid turnaround in oil exploration and supply.
... Demand is so high that shipbuilders have raised prices since last year by up to $100 million a vessel to about half a billion dollars, the report said.
As a result, drilling costs for some of the newest deepwater rigs in the Gulf of Mexico -- the nation's top source of domestic oil and natural gas supplies -- have reached about $600,000 a day, compared with $150,000 a day in 2002.
These record prices have spurred a new wave of drill-ship construction. This boom could lead to renewed offshore oil exploration that would eventually bring more supplies to the oil market and push down prices.
Already, 16 new drill-ships are scheduled to be delivered to oil companies this year -- more than double the number delivered over the past six years combined.
Shipyards from South Korea to Norway are working overtime to meet a huge influx of orders.
Most new orders for drill-ships have gone to Asian shipyards. Companies in Singapore and China have benefited, but South Korea's big three have gotten the bulk of orders for the most complex and expensive types of vessels.
There's shortage of sailors, too, as reported here:
THE American P&I Club’s magazine, Currents, says that the global maritime manpower shortage is a “time bomb that threatens to disrupt shipping operations severely in the near future”.
Chinese sources indicate that owners and crewing agencies are targeting the inland provinces to recruit, and some of the larger companies are headquartering their manning bases in these inland areas. These are relatively poor and the salaries offered are still attractive to the younger people. According to the Shanghai office of the American Club’s managers, quoting the Ministry of Communications, China has the most populous crew force in the world. At the end of 2006, there were 1.5m. crew working on vessels, including 510,000 on seagoing vessels. The P&I market, says Captain Gayton, is also concerned about the impending shortage of experienced, well-trained officers. The IMO has recently been under pressure to address training concerns, and currently has its STCW 95 convention under review. “However, these standards are minimum ones and actual training programmes worldwide differ significantly.”
Oddly, no mention of recruiting Americans for jobs as merchant sailors...quite possibly because they cost too much...

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