Transparency Market Research has released a new market report titled LNG Bunkering Market: Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2014 – 2025. According to the report, the global consumption of bunker fuel stood at 70 kilo tons in 2013 and is expected to reach 22,540 kilo tons in 2025 at a CAGR of 63.6\% from 2014 to 2025.

LNG is an attractive bunker fuel option for many shipping companies operating in the Emission Control Areas (ECAs). The price of LNG bunker fuel is significantly lower than any other ECA complaint fuels available in North America and Europe. However, the development of LNG bunkering infrastructure is restricted to a few countries in Northern Europe such as Norway and Sweden. LNG bunkering infrastructure has only developed in ports around the Baltic Sea, North Sea, and English Channel, as shipping companies operating in these areas face stiff sulfur regulations. An anticipated tightening of sulfur emission norms and a widening gap between natural gas prices and other conventional fuels are major drivers for the development of LNG bunkering infrastructure in these regions. Natural gas providers are gradually expected to increase investments in LNG bunkering facilities as several ship owners have taken initiatives to use LNG as a bunker fuel.

Currently, Northern Europe hosts most of the region’s LNG bunkering stations, which are specifically designed to cater to the fueling requirements of inland vessels and large ships docking at ports within ECAs. The initiatives taken by different port authorities and the financial assistance provided by the European Union has led to the development of LNG bunkering facilities around major trading centers in Europe. Low natural gas prices in North America are likely to boost the sales of LNG bunker fuel in the North American ports. In Asia Pacific, countries such as China and South Korea have invested substantially for developing LNG as a bunker fuel. However, no strict sulfur emission regulations are anticipated to be enforced before 2020 in this region. As a result, demand for LNG bunker fuel in Asia Pacific is anticipated to grow from 2020 onwards.

Marine vessels consuming LNG bunker fuel have been broadly segmented into tankers, bulk and general cargo vessels, container ships, and ferries & offshore support vessels. Presently, ferries & offshore support vessels account for the major consumption of LNG bunker fuel globally. Ferries, including passenger ships, spend maximum amount of voyage time within the ECAs. As a result, shipping companies operating these vessels are slowly shifting from conventional engines to LNG fueled vessels. Container vessels and tankers are anticipated to significantly adopt LNG as a marine fuel in the next few years. Rising container traffic in Asia Pacific and Europe is one the factors anticipated to lead to the adoption of LNG as a bunker fuel.
Source: Transparency Market Research

On Tuesday December 16^th Sev and ALBA Graduate Business School at The American College of Greece organized an event in order to highlight the important role and the necessity of Human Resource Management. The event titled ”From HR Metrics to Human Capital Analytics” was attended by many executives and HR specialists who discussed and learnt about the use of special tools and methods that can contribute to the effective decision making and the application of policies to the most valued asset of modern enterprises, its human resources.

According to SEV, the competitive advantage of the job market is hidden in the knowledge and the application of the modern management methods and not in the cheap costs. That is why SEV is in a very close partnership with ALBA, toaccelerate the development of the suitable tools and methods.

Dean Travlos made a short welcome note saying that ‘research creates knowledge which is transferred from the academic to the enterprise field and turns on the flame that creates the competitive advantage of an enterprise. Greek human resources, which is exquisite, needs to be organized, motivated and also it needs the suitable management tactics in order to be more productive and more creative.’

Later on, Dr. Olga Epitropaki, The Stavros Costopoulos Chair in Human Resource Management and Development, Professor of Organizational Behavior and Human Resources Management, MSc in Strategic HRM Academic Director presented and analyzed the HR Metrics.

The event concluded with a networking workshop where 60 HR executives and specialists exchanged knowledge and expertise on practices and actions in 3 interactive discussion circles.

SEV and ALBA share a strong partnership which is evolving and becoming more robust. A representative example is the 'Women in Leadership' program, a coaching program for women executives initiated by SEV and conducted by ALBA which was realized during the last trimester of 2014 and had a huge receipt from top women executives.

source: ALBA

The supertanker TI Oceania was built to ferry vast quantities of oil across oceans, but for the next year it is expected to remain anchored off the coast of Singapore, storing millions of barrels of oil for Vitol SA, a giant trading house.

According to shipbrokers and analysts, the 3-million-barrel megaship—one of the largest in the world—is just one example of efforts by traders to turn a profit in the slumping global oil market. The strategy is simple: buy and store oil at cheap prices now, selling futures contracts to lock in the higher oil prices expected later.

“It is one of the easy ways to make money and that’s one of the interesting things about it from a trading perspective: It’s a counter cyclical source of profit for the Vitols and Glencores and Trafiguras,” said Craig Pirrong, a finance professor at the University of Houston, referring to a handful of the biggest oil traders in the world.

According to shipbrokers and analysts, major traders including Vitol SA, Gunvor SA, Trafigura Beheer BV and Koch Supply & Trading Co. Ltd have chartered supertankers capable of storing a combined total of more than 30 million barrels of oil—many of them in the past few weeks. Vitol, Gunvor and Trafigura declined to comment. Koch didn’t respond to requests for comment.

The opportunity to stockpile oil in such large quantities has come from the dramatic shift in the market for the commodity in recent months. Since June, prices have collapsed, tumbling by more than 50\% amid soaring production from the U.S. and unwavering output from the Organization of the Petroleum Exporting Countries, at a time when global economic growth—the main determinant of demand—is slowing.

The oversupply has given rise to a so-called contango in the market, when the current price of a commodity is lower than prices for delivery in the future. That makes it attractive for buyers to purchase oil now at the cheaper rates, store it and strike sales agreements at a higher price in the future, locking in profits.

The price difference between the March and August contracts for Brent crude oil, the international benchmark grade, is currently $6 a barrel. That is the steepest premium since an oil-price slump in 2008 and 2009.

For years, oil trading houses have contended with high prices and low volatility, which have squeezed margins. Firms have responded by investing in infrastructure like oil-storage tanks, terminals and refineries to gain flexibility in trading, as well as better information about what is happening in the market.

Combined with the companies’ access to the physical oil market, these investments have made the trading firms uniquely well-positioned to exploit the shift in the market and store oil for a profit.

Glencore PLC, a Swiss commodity-trading giant, and Trafigura Beheer, one of the world’s largest independent oil traders, have both already highlighted to investors that the market’s dramatic change since June is expected to bolster their profits.

Onshore storage tanks are filling up fast. According to Citigroup Inc., China’s coastline storage facilities ran out of space as the country filled up strategic oil reserves last year. Stocks at the U.S. storage hub at Cushing, Okla., have risen more than 20\% since December, according to Genscape Inc., a data provider based in Kentucky.

That means more unusual storage options, such as the ships, are becoming increasingly popular.

“Because so much oil doesn’t have a home right now, there is a frenzy of traders and companies looking to hire supertankers,” said Halvor Ellefsen, chief executive officer of Galbraiths, a London-based shipbroker .

The last time there was a similar situation, in spring 2009, more than 70 million barrels of oil were stored in tankers, according to shipbrokers.

The current tanker craze may not quite reach those levels, as the disparity between current and futures prices isn’t as steep at the moment. Bank of America Merril Lynch predicts the volume of oil stored on tankers could rise to 55 million barrels by the end of the second quarter.

However, the potentially lucrative storage trade isn’t open to everyone, nor is it risk free. It requires detailed knowledge of the way oil is moved around the world that few outside a tightknit group of oil traders possess. Making a profit depends on numerous factors, including rates for freight and storage and, ultimately, finding a buyer for the crude.

“If people think the contango is some kind of magical way to make money they are incorrect,” said Benoit Lioud, senior research analyst at Mercuria Energy Group, a Swiss-based trading house. “Storing big quantities of crude oil is not an easy game. It’s not a game at all.”
Source: Wall Street Journal

ABS, the leading provider of classification services to the global offshore industry, has awarded approval in principle (AIP) for Hyundai Heavy Industries’ next-generation HD12000 heavy duty, wide beam drillship design.

The drillship, which can accommodate a 20,000-psi blowout preventer system, has been designed in full compliance with the ABS Guide for the Classification of Drilling Systems (CDS Guide) and other applicable ABS Rules and industry standards.

The HD12000 drillship will be capable of operating in 12,000 ft (3,658 m) water depth with a drilling depth to 40,000 ft (12,192 m). Featuring an innovative hull form, the design based on HHI’s proprietary technology includes enhanced dynamic positioning (DPS-3) capability through reduced hull resistance and thruster interaction, improved motion performance in maximum roll angle, and reduced wave resistance at field transit conditions.

“Awarding AIP is an important step toward supporting the evolving needs of our clients as we collectively work to enhance safety and efficiency standards,” says ABS Executive Vice President, Energy Development Ken Richardson. “Addressing greater complexity in offshore drilling, the ABS CDS Guide provides a comprehensive approach to classing offshore drilling systems and their associated support systems and equipment.”

“This is an important milestone toward meeting the applicable classification requirements for validating the structural integrity of HHI’s latest generation of drillships,” says Mr. Yun-Sik Lee, Senior Vice President, Initial Design Team at HHI. “Through the award of AIP, the design of HD12000 has been developed and verified with improved versatility and strength, increased deck space, benign motion characteristics and a reduced maintenance profile.”

As part of the basic approval work scope, ABS reviewed the concept design and associated configurations interfacing with the drilling equipment and systems that will be installed on board the drillship.

“It is essential to verify new design concepts by an independent party and it is also desirable to share experiences throughout the collaboration process that can improve on the design early on,” adds Mr. Yun-Sik Lee, Senior Vice President. “AIP provides HHI and the future owner with the additional confidence to carry out this innovative design and improve drilling efficiencies.”

ABS was the first to provide classification services to the offshore and energy industry in 1958 and continues to support the development and application of innovative floating concepts around the globe.
Source: ABS

Golar LNG took centre stage on Wall Street this week after firming up one-year time charters for a pair of LNG carriers and appointing a new chief executive.

In a client briefing an analyst at Wells Fargo Securities argued that the deals are a positive development but not a game changer.

Michael Webber pointed out that LNG carriers are no longer the “primary driver” for Golar, which trades on Nasdaq under the ticker “GLNG”.

“While LNG carriers are no longer the primary driver for the GLNG story (it's now a FLNG concept stock) a deal like this isn't as meaningful as it once was for GLNG, particularly since the carriers are financed,” the forecaster wrote.

It’s unclear how much the 160,000-cbmGolar FrostandGolar Crystal(both built 2014) fetched but the analyst does believe the deal will boost Golar’s bottom line.

“While the actual charter rate was not disclosed, relative to our conservative numbers, we believe the cash flow impact will likely be accretive,” Webber added.

On Tuesday an equity analyst at Clarkson Capital Markets, Omar Nokta, noted the freshly minted fixtures represent the first term contracts that Golar has secured for its current newbuilding programme.

“Although the terms are for just one year, they do provide some extended visibility compared to the choppy earnings profile in recent quarters,” he continued in a weekly market briefing.

Golar made TradeWinds headlines late last week when it chartered the Golar Frost and Golar Crystal to Nigeria LNG for approximately one year.

The day rate was not disclosed but Nokta believes the duo are poised to earn roughly $67,000 daily a piece, which is slightly lower than Webber’s initial estimate.

On Monday the operator made waves again when it announced the resignation of chief executive Doug Arnell, who will be succeeded by industry veteran Gary Smith.

Today, Webber argued that the impact of the change will be minor since Smith has been in the business for 35 years and presided over Golar during the financial crisis.

He also pointed out that Smith oversaw the conversion of two LNG carriers into floating storage and regasification units that were chartered to Petrobras.

source:www.tradewindsnews.com

Major Korean shipbuilders have come up with different strategies for the survival of their offshore plant business, with international oil prices continuing to plummet.

Specifically, Hyundai Heavy Industries and Daewoo Shipbuilding & Marine Engineering are planning to cut back, whereas Samsung Heavy Industries is trying to cope with the situation by means of aggressive expansion.

Samsung Heavy Industries is planning to win back the first place in the industry this year. It is aiming to win orders worth at least US$15 billion this year and attain at least US$7 billion of it in the offshore plant sector.

Meanwhile, Hyundai Heavy Industries, which is the global number one now, recently decided to let1,500 office workers go and combined the plant business unit with the ocean business unit. Hyundai Heavy Industries president Kwon Oh-kap mentioned a business goal of US$23 billion earlier this year, which is 22 percent less than the previous year’s goal. It is said that most of the decrement will pertain to its offshore plant business.

Daewoo Shipbuilding & Marine Engineering, which was the only one of the big three that succeeded in meeting the annual business target for last year, had to see its performance in the offshore plant sector limited to just 18 percent, or US$2.7 billion, of the total orders obtained. Also, its business strategies for this year revolve around LNG carriers, meaning a performance improvement in the sector will be less likely. Still, the company is going to accelerate technological development in this field by means of partnerships with foreign offshore plant design firms.
Source: Business Korea

Euronav has today launched its long-anticipated US IPO with a $201m shares sale.

Seanergy Maritime Holdings Corp. announced its financial results for the third quarter and nine months ended September 30, 2014.

Companies in the deepwater drilling market have lost more than half of their value over the last year; Transocean, Seadrill, ENSCO and Diamond are currently priced 56\% lower on average compared to January 2014 in line with the decrease in oil prices.

While these sharp falls in share prices reflect similar trends across the oil and gas industry, the number of active ultra-deep water rigs have remained high with 171 units contracted versus 175 units last January. Dayrates have also increased slightly from an average of $470,000 to $485,465, though this is largely a result of contracts signed before the fall in oil prices.

Concerns about drilling contractors’ backlogs and their ability to put their most expensive assets to use are well founded with operators announcing decreases in capital expenditure. However, based on Douglas-Westwood’s offshore drilling forecast, there are still plenty of wells to be drilled if the 2015 oil prices average between $50-70bbl. Total wells drilled could be expected to increase by 17\% by 2020 with deepwater wells growing at 32\%, despite the current price environment.

A fundamental issue is not only a lack of demand, but one of the industry’s own making. The recent build cycle has resulted in a sharp growth in supply that will need time to be absorbed by expected long-term growth in demand. Like other subsectors of the offshore marine industry such as offshore vessels and production assets, supply not just demand will determine the future direction of the offshore drilling market.
Source: Douglas-Westwood