The Shipping Trade

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The Shipping Trade
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First came the viking cargo ships, the knarr.
They were able to sail mostly downwind but
required the use of oars. Staying mostly within
sight of land, they knew a little about
prevailing winds and navigated with the aid of a
sundial and a sun stone.
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In the early 19th century Clipper ships sailed
all over the world. Not much was required to
sail the vessel except a strong back, a loud
voice, and a basic knowledge of navigation.
Navigational equipment probably included a
compass, a sextant and a telescope. Life
expectancy for the vessel was no more than a
couple of years.
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A cargo ship in the 1950s and 1960s was more
fully equipped

• Gyro Compass (maybe)
• Gyro Steering Stand (Doubtful)
• Radar (2) (used only approaching land)
• Loran A (probable)
• RDF (required)
• Fathometer (required)
• Radio Equipment ( Operator) Telegraphy

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The Norm in 2005 - Bridge

• Speed Log
• ECDIS
• Weather Fax
• Loggers
• Computer weather
• E-mail
• Digital Communications
• AIS
• SSAS
• Web Cams
• LookSea augmented reality
• GMDSS

• Compasses
• Gyro (2) (digital)
• Electronic compass (probable)
• Magnetic compass Sonde
• Digital Steering Stand
• Radar (2)
• Digital with built in ARPA
• Loran C (fully automatic)
• GPS (Multiple)
• Fathometer

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The Norm in 2005 Engine Room

• Steam Plants
• Diesel
• Diesel Electric
• Gas Turbines
• Generators
• Sewage Treatment Facilities
• Air Conditioning Systems
• Hydraulics
• Evaporators

Controlled by a modern computerized control room
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In the early part of the 21st century, the face
of shipping is quite different. Shipping has
become a heavily regulated industry. Crews have
to be increasingly well educated and trained and
conform to regulations and procedures designed to
protect cargo, crew, investors and environment.
No longer as subject to the vagaries of wind and
weather, modern cargo vessels are increasingly
becoming the transportation mode of choice.
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Changing Dynamics in the supply chain of ship
board officers and crew have also occurred

• Traditionally, the worlds economic powers built
  the ships and trained their citizens to operate
  them
• Today, the citizenry of the developed countries
  are less likely to seek careers at sea
• Todays ships are much more likely to have been
  built in a foreign yard and have a multi-national
  crew
• Significant shortages of qualified ships
  officers and crews are expected over the next
  decade in all segments of the shipping industry
• English is the official language of shipping yet
  for the vast majority of ship crews, English is a
  foreign language.

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Human error remains the 1 cause of shipping
accidents
The MEGA BORG released 5.1 million gallons of oil
as the result of a lightering accident and
subsequent fire. The incident occurred 60
nautical miles south-southeast of Galveston,
Texas on June 8, 1990.
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The New Era

• Natural gas is the economic/environmental fuel
  of choice
• 96 of natural gas reserves are located outside
  North America
• 25 of world natural gas consumption occurs in
  the U.S.
• We are entering a new era in LNG shipping with
  the imminent arrival of the first very large
  tankers with more that 200,000 cubic metres of
  cargo capacity. These tankers have new forms of
  propulsion (slow diesel or duel-fuel) and new
  technology such as reliquefaction plants on
  board.

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LNG ships are more technically advanced and carry
a cargo unlike any other

• Cargo is carried at extremely cold temperature
• LNG can only be carried in specially designed
  ships
• Loading and discharge process is different from
  other tankers
• Cargo immediately starts re-gasification process
  (boil-off)
• Highly reduced volume 1/600th
• Most ships are steam powered
• Re-liquification re-gasification plants on board

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LNG ships and the industry in general have
enjoyed an unprecedented safety record for nearly
40 years. Why?

• Excellence and continued training of crew
• Experienced officers with long tenure in the LNG
  industry
• Superior quality of ships and equipment
• Long term contracts with point to point delivery
• Controlled and sustainable growth (supply
  continually meeting demand)
• Quality control instituted by the owner/operators

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The Demand
Time-line Number of ships
In service as of September 2004 174 ships (including 28 ships delivered since January 2002)
In service as of May 2005 182 ships
Expected new contracts for 2005 50-65 (21 are firm orders)
Expected on order at end of 2005 143-158
Expected total of LNG fleet by end of 2009 339-354
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Traditional and new entrant operators, and
delivery years of new LNG ships (as of September,
2004)
Operators 2004 2005 2006 2007 2008 Total
Traditional Operators
Misc 1 2 2 5 2 12
Gas de France 1 1 1 0 0 3
Golar 1 0 2 1 0 4
Exmar 1 1 1 0 0 3
Nigeria LNG 2 2 1 0 0 5
MOL 0 3 5 0 0 8
Pronav 0 0 0 1 3 4
NYK 0 1 2 5 0 8
Sonatrach 1 0 0 1 0 2
Bergessen 0 2 1 2 2 7
Lief Hoegh 0 1 1 0 0 2
Kawasaki 0 1 2 2 0 5
Sub-Total 7 14 18 17 7 63
New Entrant Operators
Teekay 1 0 1 2 0 4
Petronet 1 0 0 0 0 1
Angelokousis (Maran) 0 1 2 1 0 4
Moller/Maersk 0 0 1 0 0 1
BG Group 0 0 3 3 1 7
Knutsen 0 0 1 0 0 1
TMT 0 0 1 0 0 1
Tsakos 0 0 0 1 0 1
Dynacom 0 0 0 2 1 3
Cosco 0 0 0 1 1 2
Sovcomflot 0 0 0 1 0 1
OSG 0 0 0 2 2 4
Iino 0 0 0 0 1 1
Sub-Total 2 1 9 13 6 31
Total 9 15 27 30 13 94
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RESULT SHORTAGES
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Shortage of adequately trained officers and crew
to meet increased manning requirements
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Composition of seafarers on board an LNG ship
Officers
Navigation Engine
Master Chief Engineer
Chief Officer (Nav.) 1st Assistant Engineer
Chief Officer (Cargo) 2nd Engineer
2nd Officer 4th Engineer
3rd Officer Junior Engineer
Total 5 Total 5
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Composition of seafarers on board an LNG ship
Ratings
Navigation Department Engine Department Pursers Office
Boatswain Oiler No. 1 Chief Cook
Boatswain Oiler Second Cook
Able Seaman Oiler Messman
Able Seaman Oiler -
Able Seaman Oiler -
Able Seaman Fitter -
Able Seaman - -
Ordinary Seaman - -
Total 8 Total 6 Total 3
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Composition of seafarers on board an LNG ship
Summary
Senior Officers (Management Level) 6
Junior Officers (Operational Level) 4
Total number of officers 10
(Note) 1st Assistant Engineer is a management level engineer in charge of cargo
Ratings 17
Total composition 27
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Estimated demand for officers for LNG ships on
order
Year Deliveries Newly Required Seafarers Newly Required Seafarers
Total Officers
2004(4th Qtr) 2 delivered 156 52 (32)
2005 20 1,560 520 (312)
2006 27 2,106 702 (422)
2007 30 2,340 780 (468)
2008-2010 86-101 6,708-7,878 2,236-2,626 (1,342-1,576)
Total 165-180 12,870-14,040 4,290-4,580 (2,576-2,810)
Figures in parentheses show the number of
Senior Officers (Management Level)
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Shortage of qualified engineers with steam
endorsement
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Estimated demand for turbine engineers
Year Deliveries Newly required turbine engineers Newly required turbine engineers
Officers Senior Officers
2004(4th Qtr) 2 (delivered) 26 16
2005 20 260 156
2006 27 351 211
2007 30 390 234
2008-2010 86-101 1,118-1,313 671-788
Total 165-180 2,145-2,290 1,287-1,374

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Shortage of time to adequately train senior
officers from a different segment of the shipping
industry to meet the qualifications for
commanding LNG ships
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Training
General qualification for shipmaster, deck
engine departments
Appropriate shore-based fire-fighting course
Approved tanker familiarization course
At least 3 months approved seagoing service on
tankers
Suggested training scheme for personnel on LNG
tankers
Tanker familiarization certificate
Experience appropriate to duties on LNG tankers
Approved specialized LNG training program
Certificate awarded Dangerous Cargo Endorsement
(Gas)
Service in positions with immediate
responsibility for loading, discharging and care
in transit or handling LNG cargoes
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Shortage of training billets aboard existing LNG
ships to be able to meet the loading and
discharge qualification requirements
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Shortage of LNG simulators and qualified
instructors
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Consequences?

• LNG ships sit idle, cargo doesnt move highly
  unlikely
• Poaching of qualified senior LNG officers from
  one company to another occurs
• LNG ships sail with minimally trained (qualified)
  crews
• Serious accidents occur.

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Solutions

• First, industry must recognize the looming
  problem
• International training standards for the LNG
  industry must be established by IMO and national
  entities
• Training programs for converting senior officers
  from one type of ship to LNG ships must be
  developed
• LNG companies must work together in order to
  provide training billets aboard LNG ships
• Underwriters and financiers should insist on some
  level of crew training and certification
• Worlds maritime academies must start process of
  providing basic LNG training to their
  undergraduate students
• SIGTTO and IAMU are developing model courses

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The Need
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