Oil & Gas, Renewables Keep Sector’s Largest Ships Busy
By Felicity Landon
Dubbed the “unsung heroes” of heavy-lift shipping, semi submersibles play a vital role in ensuring some of the heaviest and most unwieldy cargoes reach their destinations safely and efficiently. Breakbulk speaks to Fluor and COSCO Heavy Transport about the unique advantages of these flat-deck vessels.
From Issue 5, 2024 of Breakbulk Magazine.
(6-minute read)
Semi-submersible vessels could be described as the unsung heroes of project cargo and heavy-lift shipping – and in some parts of the industry, there’s scant knowledge of where, and how, semi-subs really come into their own. This is the view of one industry stakeholder to the Breakbulk Editorial Board member who would like to foster a better understanding – and appreciation – of semi-subs.
“It’s a topic that most people in project logistics don’t actually understand very well, or have a lot of expertise in,” he said. “Perhaps they don’t need to understand or use semi-submersibles every day – semisubmersibles are definitely a niche area, and we should recognize their importance as they relate to modular and offshore projects.”
Edward Talbot, USA managing director at Roll Group agreed that “industry can always learn and understand more about the more specialist end of the heavy-lift market.”
Roll Group owns and operates a fleet of “highly adaptable” transport vessels, including semi-submersible, multifunctional vessels and wide deck carriers, which the company says are suited for “a wide variety of situations and circumstances.”
As to when it makes sense to consider a semi-submersible, Talbot says: “It is a case-by-case, project-by-project basis. Project teams should consider not only the cargo and routing, but the entire logistics strategy from vendor to foundation.”
COSCO Heavy Transport, which operates the world’s largest fleet of semi-submersible heavy-lift vessels, took delivery of the 65,000dwt SP2 vessel Xiang Tai Kou in January. Measuring 231.10 meters LOA and 46 meters wide, it brought the total COSCO semi-subs fleet to 16, the majority of which are DP2 classed. The largest of the fleet is the 255-meter LOA, 98,000dwt Xin Guang Hua.
No other newbuilds are currently planned, said Peter Hansen, president of COSCO Heavy Transport, noting increased demand for semisubmersible heavy-lift vessels as the oil and gas market remains strong, while the renewable energy market is adding to client requests.
“We do not see a considerable change in geographical demand, even with the introduction of renewable cargoes,” he noted. However, he reported requirements to perform float-over mating installations of increasingly large topsides, and said COSCO had “built accordingly to meet market demand.”
Do customers have to be creative or flexible on timing to ensure access to the ships they need in the places they need them? Hansen said: “Demand for vessels is good, so it is wise to plan accordingly, and secure tonnage required for projects as early as possible.”
Flexibility Is Key
From the EPC’s point of view, flexibility is everything. Ben van der Hoeven, director module logistics at Fluor, in the Netherlands, said: “When we develop solutions for our clients, we would advise them on the design of a plant or project – and would already know what kinds of vessels we need, how many and the duration of employment of these vessels. As an EPC we have a big say in finding a match; we can go very big and have fewer shipments or smaller with modules but need more voyages. We are constantly working on finding an optimum there.”
He described COSCO’s X-class as the “workhorse” of the industry, “Simply because you tend to design towards the vessels that are available in the market. For us, from a modular construction perspective, we don’t want to look at the unique, big units of COSCO or Boskalis, we want to look at units where there are sufficient sister ships. That is very important for us.”
One unique vessel on its own is often not regarded as a strategic solution, explained Van der Hoeven. “It could be a solution for the big oil companies, for example when they need to move one large rig or FPSO, but if you have a multi-voyage modular project, you need to be able to use sister vessels. That said, Fluor does have large one-off projects from time to time, that require the services of these top-end-of-the-market, semisubmersible vessels.
“You can plan it, and change ships if needed, without having to change the engineering or design. From the starting point, we like to look at ship types where there are sufficient sister ships or technically equivalent ships and we would design a project in a somewhat strategic, conservative way to make sure we would not be without tonnage.”
COSCO says its vessels have been designed in close consultation with leading offshore, oil and drilling companies in order to incorporate the latest developments in the industry and “to provide the safest, fastest and most reliable transports and installations within the semi-submersible market.”
Van der Hoeven, who previously held commercial positions with Damen Shipyards, Boskalis (Dockwise) and RollDock, said: “We have active dialogues ongoing with the shipowners, who also approach us and say – hey, we are thinking about a newbuilding, what would you like us to build? The question from time to time passes my desk and then I will have an opinion.
“I would be happy if there was more tonnage of this and that in the market – that would make me smile, but that is not necessarily the same thing as would make the shipowners smile. Owners like to have a differentiating factor on their vessels, I like to have sister vessels. But in general, there are usually good discussions ongoing over a cup of coffee.”
Growing Environmental Awareness
As for innovation, Van der Hoeven points to size, capacity and, to some extent, speed – but more sustained speed. There is also increasing awareness of a project’s CO2 footprint, and therefore questions around fuels. An EPC is likely not in a position to reject ships that burn fossil fuel. “But if you have a vessel that can burn cleaner fuels, you may get some brownie points that just may tip the balance regarding the award of a contract.
“We would certainly say to the shipowner, it helps if you come up with solutions that supports Fluor to deliver solutions for our clients that demonstrate efforts to reduce the environmental footprint of a project.”
The pressure to adopt clean fuels will build - “and it has to,” he said. However, semi-subs are exceptionally strongly built, and they are built to last. “There are some older vessels still around and still in excellent shape.”
Hansen noted that the COSCO Shipping group, with its total fleet of more than 1,400 vessels, is spending considerable resources in evaluating alternative fuel sources. “Our parent company, COSCO Shipping Specialized, recently put two LNG dual-fuel powered ro-ro vessels into service,” he said.
The market is fairly quiet for large modular projects at present, according to Van der Hoeven. There has been a tendency towards projects with smaller modules, but he predicted that the larger modules “will come again. Although fossil fuels and traditional chemicals may be in a mature phase on their S-curve, they will continue to form the lion share of our industry.
“Many of the renewables and sustainable projects, recycling and upcycling projects, are still at the beginning of their S-curve and time will tell whether large-scale growth towards more mature business will lead to more and larger modules being shipped.”
Global Developments
There have been unexpected knocks – for example, the delay (or extended timescales) on projects in the Middle East, where operators were gearing up for huge demand and newbuilds were being considered to serve this, and the impact of Russia’s invasion of Ukraine, pushing back key energy projects.
“Nobody expected that we would have the war in Ukraine. If that wasn’t there, there might have been further developments in the Russian Arctic,” said Van der Hoeven. “Global developments, including present tensions in the Middle East, impact shipping needs and also the supply situation; it’s a fine balance of supply and demand and the scales can be tipped very quickly, so there is a reluctance to build new ships too intensively.
“In the minds of shipowners, it hasn’t been too long since we saw a market with an over-supply of deck carrier tonnage, causing a doldrums period of several years with prolonged idling of vessels. A few shipowners, with the right commercial and strategic vision and the financial robustness to do it, are now stepping forward to initiate new building. A prime example is BigLift Shipping/CY Logistics, whose new ballastable module carriers will soon enter service.”
Van der Hoeven says there is more demand for flat deck carrier tonnage in general, though “whether that is going to be semi-submersibles remains to be seen. It depends highly on the location of projects. At the moment, many of the semi-submersibles are engaged in the renewables industry. If we separate out that part, we are still in need of potential semi-submersibles if the location of a project requires.”
Hence, he said, there is room for some semi-sub newbuilds. He pointed to Canada and Australia as key areas, due to their large tidal variation. “Semi-submersibles have much bigger ballasting capabilities than other vessels. In certain locations we need that – where the tidal variation is so big that you do need ships with significant ballast capability.”
Some of the ballastable module carriers, however, also have high spec ballast systems to offer similar performance as the semi submersibles, Van der Hoeven noted.
Semi-submersibles have another big advantage, he added – they can be used in conjunction with piggyback systems, carrying barges that are loaded with modules. “There are applications of semi-submersibles in the market where a barge is the solution for the last mile – drop it off in deep water and the last mile or upriver stretch can be done by barge.”
Another reason to consider piggyback concepts is a possible reduction of the high day rates commanded by semi-submersibles by pre-loading barges and following up with a relatively straight forward barge float-on operation, the Fluor executive said.
“This can avoid having to develop a full-depth material offload facility, with the barge able to be pushed into a shallow material-receiving facility,” Van der Hoeven concluded.
The readiness of the heavy-lift fleet to meet rising shipper demand will be one of the topics discussed during a main stage panel session at Breakbulk Americas 2024. “Fleet Capacity: Planning for the Future”, moderated by Drewry’s Ferenc Pasztor, is on Wednesday, Oct. 16 from 11:05-11:50.
TOP PHOTO: COSCO Heavy Transport operates the world’s largest fleet of semi-subs. CREDIT: Cosco Shipping
SECOND: Roll Group owns a fleet of transport vessels, including semi-subs and wide deck carriers. CREDIT: Roll Group
