Saturday, May 25, 2024

Houthi Claim Long-Range Attacks Including LPG Carrier in the Mediterranean

The Houthi claimed specific long-range attacks on Friday during their weekly rallies after weeks of threatening to expand their range during the so-called fourth wave of their efforts. Military sources and security analysts are warning of the capabilities while most of the attacks continue to be in closer proximity to the Houthi-controlled areas of Yemen.

In the latest statement of Houthi spokesperson Yahya Saree, he took credit for three recent attacks without providing details. Two of these he said took place in the Arabian Sea and the Mediterranean, although monitors such as the UK Maritime Trade Organizations, EUNAVFOR Aspides, and the U.S. Central Command have not recorded these attacks.

One cited was on a vessel called Essex that they said was Israeli and had entered the ports under the Houthi blockade. Multiple sources are matching the vessel up with the LPG carrier Essex (26,447 dwt) with a capacity of 35,000 cbm of gas. The ship’s AIS signal shows it in the anchorage at Alexandria, Egypt after shifting from Port Said.

The vessel registered in Liberia is managed by Zodiac Maritime of the UK, which has been a target of the Houthi due to the investment by Israeli shipping magnate Eyal Ofer. Reuters is quoting a spokesperson from Zodiac as saying nothing unusual has happened to the vessel recently while Ambrey says the vessel has not left Egypt recently.

The direct threat on a specific ship in the Mediterranean comes after Bloomberg cited an unnamed “senior defense official” saying this week that the Houthi could reach the Mediterranean. The report said the U.S. was concerned based on the advanced weaponry the Houthis were using.

While it appears they might have the range, security experts are still questioning the accuracy of their attacks, especially given the frequent misses of moving ships at a much closer range. Also, they cite the ability of Israel, the U.S., and other forces to detect long-range missiles.

Clustering of incidents between February and May (Aspides)

In its most recent assessment, EUNAVFOR Aspides writes, “UAV and missile attacks occur along the primary navigation route off the coast of Yemen, with the highest risk area spanning approximately 200 nm northbound and eastbound of Bab al-Mandab Strait, towards the South Red Sea and the Gulf of Aden.” They published a map showing the clustering of attacks.

The second threat came against the MSC Alexandra (190,734 dwt) one of MSC’s larger vessels sailing currently from Spain and due to reach Abu Dhabi tomorrow, May 25. The Houthi claimed to have fired on the vessel while it was in the Arabian Sea. They have frequently targeted MSC for its association with Israel, although this vessel is owned by the Geneva-based company.

It is unclear when the attacks allegedly took place because the third one they took credit for happened yesterday. The vessel, a Greek-managed bulker named Yannis (50,779 dwt) and registered in Malta reported an explosion in the waters nearby on Thursday. A single missile hit the water while the vessel was 68 miles off the Yemeni port of Al-Hudayda. The ship’s AIS track shows it transited the Suez and reports it is heading to Mombasa, Kenya.

The Houthi singled the ship out and its manager Eastern Mediterranean Maritime, saying that three of the group’s ships had called in Israeli ports on May 4 and 5. Eastern Mediterranean Maritime reports it currently manages 75 vessels. The company manages another bulker, another bulk carrier, Cyclades, which was attacked also in the Red Sea last month and sustained minor damage.

U.S. CENTCOM also reported that two Houthi-launched anti-ship ballistic missiles fell into the Red Sea on May 23. They said there were no injuries or damage reported by U.S., coalition, or commercial ships.

“The occasional drop of confirmed attacks in the Red Sea, Bab al-Mandab Strait, and the Gulf of Aden shall however not dismiss the fact that Houthis still hold the capacity to launch such attacks,” Aspides warned this week.

Belgium Bans Exports of “Dirty Fuels” to West Africa

The Port of Antwerp will no longer be used by oil companies and traders to export so-called dirty fuels to West Africa. The Belgium government banned the export of toxic motor fuels that are highly harmful to public health and the environment.

Belgium’s Minister of Environment Zakia Khattabi announced the country has banned the exports of toxic fuels that are domestically prohibited but continue to be shipped to West African nations including Nigeria, Ghana, and Cameroon. This comes following the Royal assent of a new legislation that seeks to tighten the quality of exported fuels.

The ban targets oil companies that export motor fuels, primarily from the port of Antwerp, with excessively high sulfur or benzene content that have long been banned in Europe due to their harmful effects. Data show that oil companies have been exporting dirty fuels with a sulfur content as high as 1,500 ppm (parts per million), far exceeding European standards that are capped at 10 ppm.

In imposing the ban that will take effect after three months, Belgium highlights that the standards it applies at home to protect the environment and citizens from the harmful effects of toxic fuels should also apply to exported products. The country now joins the Netherlands which in April 2023 also banned the export of low-quality gasoline and diesel to West Africa through the ports of Amsterdam and Rotterdam.

Netherlands’ decision to stop the exports meant that Antwerp, Belgium’s main sea terminal for oil trade (both crude and oil products), became Europe’s main hub for exporting the toxic fuels. Antwerp is centrally located and as such a main port for liquid bulk cargoes. The port has emerged as a leading European oil and chemical hub. About 30 companies operating in the oil and chemical sector, including at least 10 top world players, are located in Antwerp’s port area which also has two leading refineries.

S&P Global Commodities at Sea data show that West Africa imported about 137,000 barrels per day of gasoline from Belgium in April, an 18 percent increase compared to the same period last year.

Khattabi highlighted that the Netherlands’ decision to restrict the exports of dirty fuels has seen the trade shift to Belgium, which is now being used by oil producers and traders to export gasoline with excessively high levels of benzene and sulfur.

“For far too long, toxic fuels have been departing from Belgium to destinations including Africa. They cause extremely poor air quality in countries such as Ghana, Nigeria, and Cameroon and are even carcinogenic,” said Khattabi.

The move to ban the exports of dirty fuels was taken in collaboration with the Ministries of Energy and Public Health.

Mysterious Tug That Caused Tobago Oil Spill May Have Been Found in Angola

capsized barge — Trinidad and Tobago has been seeking details on the tug towing the barge for more than three months (TEMA)

After three months of searching, government officials in Trinidad and Tobago may have finally located the mysterious tug thought to have caused the disastrous oil spill off the coast of Tobago in February. International sources and independent researchers have all been working to confirm the identity of the tug and to locate it after it went dark at the beginning of February.

“The government has received information that the tug Solo Creed may have been detained by the authorities in Angola,” the Trinidad and Tobago Energy Ministry announced in a statement yesterday. They reported that an official inquiry had been submitted to Angola through diplomatic channels.

The incident began on February 7 with reports that a capsized vessel had washed ashore and was leaking oil. Initially, it was thought to be a small cargo ship but later investigations confirmed that it was an oil barge named Gulfstream. The open-source intelligence experts at Bellingcat identified the overturned vessel as a formerly American-owned ATB barge and then tracked its movements suggesting it was being towed by a tug alternately known as Solo Creed or Ranger. TankerTrackers.com using satellite imagery and other data also tracked the tug and barge.

The vessels were thought to be coming from Panama and according to some reports were bound for Guyana. Some suppositions were that it was carrying Venezuelan oil and that the tug got into some form of trouble and cut the barge loose. The last signal from the tug was February 5 and some people told local media that they thought they saw the barge drifting offshore before the grounding.

“The government is committed to continuing its pursuit of those responsible for this oil spill,” they said in their latest update.

Ownership of the tug and barge has also been debated. A media report in The Guardian newspaper in Trinidad suggested the tug and barge had been purchased by a Nigerian businessman Abraham Olalekan. The tug is reported to have been built in 1976 in the United States and is 128 feet (39 meters) with 538 gross tons. Most databases reflect it as the Ranger registered in Tanzania but in most cases, the data is reported as old or the owners as unknown.

The government retained international salvage teams to stop the oil leaking from the barge and assist with the shoreline cleanup. Some reports suggest the spill reached as far north as Grenada and west to Bonaire. Recent statements suggested there could be as many as 2,000 barrels left aboard the barge. The barge has 12 fuel tanks with reports saying it could have been loaded with as much as 35,000 barrels.

Government officials recently reported that they have lowered their initial claim to $23 million but noted that the clean-up and salvage continue. They had previously filed a $30 million preliminary claim with the International Oil Pollution Compensation Fund and are reported to be negotiating a settlement.

Schooner Running Eco-Cargo Service Lost Off Bahamas with Two Missing

schooner cargo ship — De Gallant built in 1916 was operating an eco-cargo service (Blue Schooner)

One of the historic schooners used to operate an eco-cargo service crossing the Atlantic was reported lost with two of its eight crewmembers missing. The U.S. Coast Guard and the Royal Bahamas Defense Force reported that suspended the search operation late on Wednesday after 44 hours and a search covering 3,700 square miles.

Six crewmembers were recovered and two of the vessel’s lifeboats were located along with a debris field approximately 20 miles north of Great Inagua at the southernmost end of the Bahamas. The crewmembers had donned their survival suits they told their rescuers when it became apparent the vessel was sinking.

The survivors reported that the ship was sailing in good conditions with winds less than 10 knots and a good sea state on Tuesday, May 21. They are indicating that an “extremely sudden and violent” meteorological phenomenon overtook them while they were underway in otherwise mild conditions. The captain is among the survivors and they are reporting the people were professional sailors and trained in sea survival and rescue techniques. The operation had been designed to possibly carry passengers or trainee sailors, but it is not clear if any were aboard during this voyage.

Life rafts recovered at the wreck site (USCG)

The Coast Guard reports it began receiving signals from personal locators early on Tuesday and was unable to reach the vessel. A helicopter was dispatched which located the survivors around 8:00 a.m. on Tuesday and transported them to the USCG Air Station Miami. Working with the Bahamas, planes, boats, and helicopters undertook the search.

The vessel, named De Gallant, left Santa Marta, Colombia on May 11. The company had posted pictures online showing a cargo of coffee, cocoa, and cane sugar being loaded aboard. Reports said they were bound for Europe with a planned stop in the Azores.

The cargo service was launched in 2017 by a French company called Blue Schooner designed to use wind energy to transport mostly organic goods. De Gallant, with a length overall of approximately 119 feet (36.2 meters), had a capacity of 35 tonnes. Built in Vlaardingen (Netherlands) at the Figee brothers' shipyard and launched in 1916 under the name Jannetje Margaretha, she displaced 160 tonnes. She was most recently registered in Vanuatu and operating under charter to Blue Schooner.

De Gallant in Colombia on a prior voyage alongside a small containership (Blue Schooner)

The concept was to carry cargo as well as passengers and trainees. They also offered the opportunity to conduct scientific experiments while underway. The tentative schedule posted online shows the vessel was to be in Europe before a planned return to Colombia in November.

The Coast Guard extended its condolences to the families while the French consulate in Florida was providing support for the six survivors. The vessel was lost at a depth of more than 2,000 meters.

Allianz: Shipping Losses Continue Decline Hitting All-Time Yearly Low

tanker fire — Shadow tanker Pablo caught fire in May 2023 highlighting the losses from fire and the dangers of the growing shadow fleet (MMEA)

The global shipping industry is recording a continuing decline in large vessel losses despite the sector facing growing risks. Global insurer Allianz released its Safety and Shipping Review 2024 which shows shipping losses hit an all-time low, maintaining a trend that has been developing in recent years.

The review contends that despite the global fleet grappling with growing volatility and uncertainties from war and geopolitical events, climate change, and the resurgence of piracy among other risks, the sector lost just 26 large ships in 2023. This represented a decline of more than one-third year-on-year and by 70 percent over the past decade. In 2022 and 2021, a total of 41 and 59 losses were recorded respectively while 729 ships have been lost over the past decade.

Allianz highlights the decline in losses is taking place in an increasingly dangerous environment. The shipping industry is confronting a broad range of issues, including the conflicts in Gaza and Ukraine, the re-emergence of Somali piracy after a long lull, climate change instigated drought, shift towards even larger vessels due to decarbonization pressures. The challenge is that these issues are fast evolving changing the operating environment for shipping companies.

“The speed and extent of the way the industry’s risk profile is changing is unprecedented in modern times,” said Captain Rahul Khanna, Allianz Commercial Global Head of Marine Risk Consulting.

The 2024 review shows that Southeast Asia remains the global loss hotspot. The South China, Indochina, Indonesia, and the Philippines maritime region accounted for almost a third of vessels lost last year, eight in total. Over the past decade, 184 large ships have been lost in the region. The East Mediterranean and Black Sea regions ranked second with six losses in 2023.

The review highlights that cargo ships accounted for over 60 percent of vessels lost globally during the year. Foundering was the main cause of the losses, accounting for 50 percent, of all vessel casualties. Extreme weather was reported as being a factor in at least eight vessel losses around the world in 2023, with the final total likely higher.

The trend of declining losses also carried over into the number of total incidents in 2023. Allianz calculates that globally, the number of incidents declined slightly from 3,036 to 2,951 in 2023. The British Isles had the highest number of incidents at 695.

Allianz continues to spotlight fires aboard vessels, a perennial concern of the shipping industry. The fact that fire remains a key safety issue on larger vessels given the potential threat to life, the scale of the damage, and as a result, the associated costs can be severe. Allianz says the constant high numbers of fire incidents remain a major concern. In 2023, 205 fire incidents were reported, the second-highest total for a decade after 2022. Over the past five years, 55 losses have been caused by fires.

In the review, Allianz highlights a picture of the current dangers facing global shipping. The conflict in Gaza is a case in point of how global shipping has become vulnerable to proxy wars, disputes, and geopolitical events. They point out that more than 100 ships have been targeted in the Red Sea alone by Houthi militants.

Russia’s invasion of Ukraine, a war that is now in its third year, has also resulted in a significant increase in the “shadow fleet” of tankers being used to transport Russian oil. Allianz projects that in an effort to evade sanctions, the size of the dark fleet has ballooned to between 600 and 1,400 vessels. Considering that the dark fleet consists of mostly older, often poorly maintained vessels that operate outside international regulation, and often without proper insurance, their high number presents serious environmental and safety risks Allianz cautions.

“Both the war in Ukraine and the Red Sea attacks have also revealed the increasing threat to commercial shipping posed by new technology, such as drones, which are relatively cheap and easy to make, and difficult to defend against without a large naval presence,” noted Khanna.

While external factors continue to cause vulnerabilities to the global fleet, the pressure to decarbonize is also bringing about challenges. This is because the industry needs to develop infrastructure to support vessels using alternative fuels, such as bunkering and maintenance. This comes with potential safety issues considering that terminal operators and vessels’ crew face the prospects of handling alternative fuels that can be toxic or highly explosive.

Senior Maryland Pilot Warned Officials of Risk of Bridge Strike

A senior Maryland pilot raised concerns about the risk of an allision between a big ship and the Francis Scott Key Bridge at least as early as 2006, and continued to discuss the matter in local safety meetings for years, according to detailed records uncovered by the Washington Post. The documents also show that at the staff level, the Maryland Transportation Authority was aware that their bridge was "not designed to withstand collisions from large vessels," and that the cost of protecting it would be high.

Through requests and online sleuthing, the Post obtained copies of the meeting minutes for gatherings of the Baltimore Harbor Safety and Coordination Committee dating back two decades. This advisory committee is a quarterly gathering of representatives from the port's main stakeholders in industry and government, including the pilots' association, the Army Corps of Engineers, the Coast Guard, the port authority and state transportation officials.

The possibility of a ship hitting and damaging the bridge came up at least as early as 2004, when pilots' representative Capt. Joe Smith voiced concerns about the need for solid communications protocols in the event that a ship should go off course near the structure.

Two years later, in 2006, an engineer with the Maryland Transportation Authority (MTA) joined the safety committee meeting to talk about standards for protecting bridge piers from ship strikes. At that meeting, Capt. Smith "stressed the importance of bridge protection" and "noted that the agencies should be meeting and discussing implementation possibilities." No protection upgrades were planned, the engineer said, noting the high cost. He confirmed that the bridge piers were not designed to withstand a strike from a large, modern ship.

Smith continued to raise the matter of bridge protection for six more years, and the discussion frequently returned to the cost of the necessary upgrades. The line of discussion ended in 2014, shortly after Smith's retirement, according to the Post. The Key Bridge's limited protections were not upgraded, and former state officials told the paper that the matter was never discussed at a high level.

At the Delaware Memorial Bridge, 60 miles away on the same freeway system, a different agency reached a different conclusion. Delaware's bridge transport authority assessed that the risk of a catastrophic ship strike on the Memorial Bridge was too high, and it began planning a comprehensive pier protection system for the Memorial Bridge in 2015. With considerable political effort, it successfully got it funded through a bond measure and toll hike. Construction started on the eight protective steel-and-rock dolphins last year and should be done by 2025. The final cost will come to about $93 million; the cost of replacing Baltimore's Key Bridge is expected to run towards $2 billion.

NTSB: High Current Led to Allision at McAlpine Locks

Louisville energy — Courtesy Louisville Energy and Environment Cabinet

The NTSB has released a report on the allision of a barge tow with a lock structure on the Ohio River in March 2023, concluding that the $2 million accident was due to high current and human error.

In late March, the Ohio River at the McAlpine Dam was approaching 15 feet and rising, triggering an "extreme high water / extreme high flow" warning. The Coast Guard broadcast a notice to mariners warning them to exercise caution in the area, given the high outdraft currents from the dam. Eight of the dam's nine gates were open to let the excess flow past.

On the morning of March 27, the towboat Queen City got under way on the Ohio near Hebron, Kentucky, downbound and headed for Paducah. She had 11 barges in tow as she neared the McAlpine Locks. At the time, the locks' upper gage measured 17.5 feet of water, well above the "extreme" level.

At about 0218 on March 28, the pilot was alone on watch in the wheelhouse and approaching the locks. As soon as he was clear of the Clark Memorial Highway Bridge, about 800 yards from the lock, the current began to set the tow to starboard at a rate of about one knot - towards the Vane Dike and the lower dam gates. It "started grabbing me, it wasn't looking good," he later told investigators. The pilot ordered a deckhand to call the captain, and the master got out of bed and was on his way to the wheelhouse when he felt Queen City's tow hit the tip of the Vane Dike mooring cell.

The tow broke apart on impact, and six barges went through the dam gates. The current pinned three more across the gates, including one barge filled with methanol, the only hazmat cargo in the tow. Because of the risks of a methanol release, the river was closed to navigation temporarily and a unified command organized a response. After planning, a commercial salvor lightered off the methanol cargo and recovered the damaged barges from the waterway. The cost of repairing the barges came to about $1.5 million, and the lost cargo (corn) was worth about $500,000.

The pilot had seven years of experience and had been working aboard Queen City for about 18 months. He had transited the same route more than a dozen times before, he said, but this was the highest water he had ever experienced.

The risk of an allision at the McAlpine Lock and Dam was well known, and the local pilotage advisory guide cautions mariners to "exercise extreme caution, enter chambers at slowest safe speed, and prepare for potential outdrafts." The dike was hit twice in a month in February 2022 alone, according to NTSB, and AIS data showed that other tows in 2023 had been set towards it by the current.

NTSB determined that the cause of the Queen City allision was the pilot's failure to compensate for the strong outdraft during high current conditions.

"Near dams, greater dam openings in high-water conditions lead to high flow rates, which can produce outdraft currents near the dam. Mariners should thoroughly assess the potential impact of outdraft currents when entering or exiting locking channels," NTSB cautioned.

Climate Change May Be Fueling a Resurgence of Piracy Across Africa

[By Selina Robinson]

In the churning waters off Nigeria, armed pirates in small skiffs speed towards a cargo ship. They clamber aboard, seizing control of the vessel and its valuable cargo. This isn’t a scene from a swashbuckling film; it’s a stark reality for seafarers in many parts of the world.

Piracy poses a threat to global shipping, trade and the safety of seafarers. In 2020 alone, there were 135 maritime kidnappings, with the Gulf of Guinea off the West African coast accounting for over 95% of abductions. Pirates often subject hostages to violence, torture and even execution.

What’s more concerning is that climate change seems to be making the problem worse. In regions like East Africa, climate change is devastating the coastal fisheries that people have depended on for generations.

Climate change is causing fish stocks to decline as some species migrate out of the reach of local fishermen. And prolonged drought and extreme weather have exacerbated food insecurity and poverty on land. Some former fishermen, in collaboration with militias and unemployed youth, have turned to piracy as a means of survival.

Armed security measures in Somali waters over the past decade have successfully reduced the number of piracy incidents in the region. However, recent data suggests that piracy in Somalia is rearing its head again. In the first quarter of 2024, there were 33 incidents reported off the Somali coast, including two hijackings.

A similar story is unfolding thousands of kilometres away in the Gulf of Guinea. Piracy there is linked to oil theft by criminal groups who recruit impoverished youths to hijack tankers and siphon crude. Research has found that warming waters and rampant illegal fishing have decimated local fisheries and have left coastal residents with little to fall back on.

In the Ivory Coast, the total catch fell by nearly 40% between 2003 and 2020. In Ghana, landings of small fish dropped by 59% between 1993 and 2019. And projections for these two countries and Nigeria suggest that the haul could plunge by another 50% by 2050.

The illicit profits from oil theft are immense. For Nigeria alone, these profits are estimated to be between US$3 billion (£2.35 billion) and US$8 billion each year. This dirty money fuels arms trafficking, corruption and lawlessness – a vicious cycle that undermines development and security efforts.

As climate change and illegal fishing deepen poverty in the region, more desperate people may turn to maritime crime. This would perpetuate instability and threaten the safety of seafarers and global trade.

Tackling piracy’s roots

Investment in sustainable fishing, alternative livelihoods and economic development in coastal regions made vulnerable by climate change are essential to stem the rising tide of piracy.

The Puntland Maritime Police Force, a security force based in the semi-autonomous region of Puntland in north-eastern Somalia, curbed piracy in Somali waters effectively after its formation in 2010. Pirate attacks off the Somali coast fell from a peak of 237 in 2011 to just nine in 2017.

By patrolling territorial waters, the force deters pirate activity and intercepts attacks before they happen. It also focuses on training and equipping local authorities, fostering a sense of ownership in maritime security.

Alongside security measures, the Puntland Maritime Police Force has helped build coastal communities that are more resilient to the effects of climate change. With the support of the United Arab Emirates, it is investing in infrastructure projects like schools, hospitals and roads, while also supporting alternative livelihoods through fishing cooperatives and vocational training programmes.

The success of the Puntland Maritime Police Force showcases the effectiveness of an approach that addresses both the symptoms and the underlying causes of maritime crime.

Climate change is not solely responsible for the resurgence in pirate activity. Illegal fishing by foreign vessels is further depleting fish stocks and damaging marine habitats. This, alongside climate change, limited economic alternatives and weak governance, is creating conditions that are conducive to the rise of piracy.

Thus, cracking down on illegal fishing and improving maritime surveillance capabilities can also contribute to tackling piracy. In Somalia, the EU’s satellite monitoring systems have helped to track fishing vessel activity in the region and deter the illegal fishing that can fuel piracy.

And information sharing initiatives between countries are fostering greater regional cooperation and enabling a more coordinated response to maritime threats. The so-called Shared Awareness and Deconfliction initiative in the Gulf of Guinea, for example, involves regular meetings between navies, coastguards and industry stakeholders to share intelligence, coordinate patrols and develop best practices for maritime security in the region.

Ultimately, piracy is a symptom of the wider instability caused by climate change in many of the world’s most vulnerable coastal regions. Inaction will put more lives at risk and threaten the maritime trade that powers the global economy.

The surge of piracy in the world’s warming waters is a forewarning. It shows how quickly communities can destabilise when climate change erodes traditional livelihoods. Defusing this threat will require a more sustainable, equitable and climate-resilient future for coastal communities – before more desperate people turn to piracy to survive.

Selina Robinson is a Senior Lecturer in Forensic Investigation at the University of Winchester

This article appears courtesy of The Conversation and may be found in its original form with its supporting links here.

Spanish Frigate Secures Cargo Ship After Failed Pirate Attack

Spanish frigate and cargo ship — Spanish frigate Canarias secured the Basilisk after being boarded by pirates (EUNAVFOR)

The Spanish frigate Canarias which is operating as part of EUNAVFOR Atalanta came to the rescue of the second merchant vessel in less than two weeks. A team from the Spanish vessel boarded and secured the German-managed Basilisk which had been boarded yesterday and provided medical treatment.

The Canarias (3,160 tons displacement), commissioned in 1994, has regularly been assigned to the region by Spain as part of its contribution to the security efforts. Atalanta reports the vessel reached the Basilisk Thursday night and Spanish troops used the “Fast-Rope technique” transferring by helicopter to the deck of the Liberian-registered Basilisk (17,800 dwt).

The multipurpose cargo ship was approximately 380 nautical miles east of Mogadishu, Somalia, heading north when two small boats had come alongside on Thursday. An undetermined number of pirates boarded the ship and attempted to take control. Security consultant Ambrey reports that the 17 crew, except the captain, secured themselves in the citadel and remained there until the Spanish forces boarded.

Spanish troops boarding the Basilisk (EUNAVFOR)

When the pirates boarded the vessel one of the crewmembers was injured according to EUNAVFOR and they provided medical assistance. Ambrey is reporting it was the captain who had been shot in his arm.

The Spanish forces reported that the pirates had fled the vessel and they confirmed that the ship was secure. The Basilisk is continuing on its voyage to the United Arab Emirates.

Spanish forces secured the Basilisk and provided medical attention to the injured crewmember (EUNAVFOR)

Separately today, EOS Risk Group is reporting that a cargo ship registered in Panama, sailing approximately 185 nautical miles southeast of Hafun, Somalia, was approached by three small boats. The vessel is the Al Amal, an 8,900 dwt cargo ship, is managed out of Oman. It is unclear where the vessel was heading.

“Al Amal was requested to reduce speed, however, increased speed to open distance from suspect dhows,” writes Martin Kelly, Head of Advisory at EOS Risk Group. The small boats reportedly were following the cargo ship for over five hours.

Nearly two weeks ago, the same Spanish frigate, Canarias, also responded to reports of another incident in the Indian Ocean. Pirates had exchanged gunfire with the security crew on a product tanker. The pirates withdrew without boarding the vessel, but the Canarias was able to find the pirates. They were handed over to the Seychelles for prosecution.

"Mixed Bag" Outlook for Offshore Energy

While renewables stagnate, it’s full speed ahead for offshore oil and gas.

(Article originally published in Mar/Apr 2024 edition.)

The “energy transition." You know the term, but where did it come from? While interest in alternative energy sources can be traced back to the oil crisis of the 1970s, it was during the 2015 Paris Agreement that the first hard goals were placed toward limiting global warming to below 2oC compared to pre-industrial levels.

“Energy transition” refers to a shift from fossil fuels — including oil, natural gas and coal — to renewable energy sources like wind and solar as well as power storage driven by lithium-ion technology. The push for electrification and improvements in energy storage are all key facilitators of the transition.

In the marine space, a sector notably excluded from the Paris Agreement though responsible for approximately three percent of total greenhouse gasses globally, most of the recent attention has been on IMO 2050 — the International Maritime Organization’s Greenhouse Gas Strategy, which sets a target of net-zero emissions by 2050.

These goals — net-zero emissions, less than 2oC — impact investment strategy, operating procedures and equipment selection. Ultimately, they provide a lens through which the entire offshore energy sector can be viewed as investors and regulators prioritize environmental, social and governance (ESG) factors.

State of Renewables

Offshore wind has long been touted as a viable solution, yet 2023 found the sector battling stormy seas.

On the U.S. East Coast, 2023 saw major projects cancelled due to macroeconomic factors such as skyrocketing inflation, increasing interest rates and supply chain issues that impacted the entire industry. Moving forward means more favorable terms are needed for developers, but those terms will come with higher energy costs to the already squeezed consumer.

On a potentially positive note, previous windfarm partnerships were dissolved earlier this year with Equinor and bp splitting their joint ventures. Equinor will take full ownership of the Empire Wind 1 and 2 projects while bp assumes full ownership of the Beacon Wind project. Likewise, Ørsted is vying for full ownership of Sunrise Wind, working to acquire Eversource’s 50 percent stake in the project.

Sole control over these projects should allow developers to make better business decisions while gaining negotiating leverage over regulators. Because despite the noble intentions of the transition, “If it don’t make dollars, it won’t make sense.”

M&A Market

While companies are moving apart in the renewables space, they’re consolidating upstream.

Both Exxon and Chevron have made massive investments of around $60 billion each, acquiring Pioneer and Hess, respectively. Chevron’s purchase of Hess looks to future inventories, specifically the Stabroek Block in Guyana, which is core to Chevron’s future production plans.

Talos Energy recently completed its acquisition of QuarterNorth, adding production of approximately 30 thousand barrels of oil equivalent per day (Mboe/d).

In the natural gas space, Chesapeake Energy and Southwestern Energy announced a $7.4 billion all-stock merger at the start of the year that will create the largest natural gas producer in the U.S. “This powerful combination redefines the natural gas producer,” stated Chesapeake President & CEO Nick Dell’Osso, “forming the first U.S.-based independent that can truly compete on an international scale.” Dell’Osso will head the combined company.

Investing in 2024

The energy industry is off to a strong start, largely thanks to high oil prices, which will allow the upstream industry to maintain its 2023 hydrocarbon investment level of about $580 billion and generate over $800 billion in free cash flow in 2024. These investments are driven by expected stable oil prices from 2023 with WTI crude expected to average $78.84 per barrel.

This isn’t all positive for renewables, though.

A 2023 Deloitte survey of O&G executives found that investment in low-carbon projects would be made if returns on those projects exceeded 12 to 15 percent. Yet 2022 returns on major renewable electricity projects ranged from six to eight percent. This means the 2024 focus is more likely to be on (1) addressing operational efficiency and reducing direct emissions, and (2) alternative, low-carbon fuels such as natural gas, biofuels and hydrogen.

But if investment in renewable projects is sitting this inning out, there were major upstream projects greenlighted in 2023 that will bolster the industry in 2024.

In the U.A.E., ADNOC group awarded contracts for development of the Hail and Ghasha offshore gas fields. This is an interesting project as it’s the world’s largest offshore sour gas development, and it aims to operate with net-zero CO2 emissions. The design aims to capture 1.5 million tons of CO2 per year by transporting it onshore and storing it underground – a truly integrated solution.

In the U.K., both Equinor and Ithaca confirmed investment decisions for the controversial Rosebank Field, finally approved by the North Sea Transition Authority. The project targets an estimated 300 million barrels of oil and will tie back subsea wells to a redeployed FPSO. Production is expected to begin in 2026 or 2027.

The Gulf of Mexico saw multiple projects getting the green light including Woodside Energy’s Trion project in the Perdido Basin. The project will use a floating production unit (FPU) connected to a floating storage and offloading (FSO) vessel. Shell made the decision to move forward with the Dover project in the Mississippi Canyon block, tying back to the Appomattox production hub. It also greenlit the Sparta project, which includes eight production wells tied back to a semisubmersible FPU.

And in Guyana the Stabroek Block continues to heat up with ExxonMobil sanctioning its fifth development project – Uaru. It includes up to ten drill centers and 44 production and injection wells.

FPSO Development

Increased production and investments in field developments are relying heavily on Floating Production Storage and Offloading (FPSO) units with many of them planned for Guyana.

The FPSO Errea Wittu, which means “abundance,” will be deployed approximately 200 kilometers offshore Guyana at a water depth of 1,690 meters and storage capacity of two million barrels of crude. It will be “one of the most sustainable FPSOs in the world, using an energy production system with a combined cycle turbine on board.”

The mooring preinstallation contract has been awarded to Jumbo Offshore Installation Contractors by MODEC Guyana. The FPSO mooring system consists of nineteen legs with suction anchors, 8,800 meters of chain sections and 43,168 meters of polyester rope. Jumbo’s heavy lift vessel Fairplayer is uniquely designed with large amounts of cargo space to perform the transport and installation with a minimal number of voyages.

Igor Rijnberg, Head of Sales & Business Development Subsea at Jumbo Offshore, said, “The Jumbo Offshore team is very grateful to MODEC for this opportunity. We will use the extensive deep-water mooring installation experience gained over the last years to deliver a reliable, smart and efficient project execution.”

OSV Market

Growing EPC (engineering, procurement and construction) spend and increasing scarcity of premium vessel supply (less than 15 years old) could see OSV utilization rates reach 83 percent by the end of 2024, says Westwood Global Energy Group.

The active global OSV fleet totaled 3,077 vessels in 2023 with around 250 premium vessels still laid up. These will continue to be brought out of layup as the year progresses. Vessel day rates have also become more attractive with increases of nearly 70 percent since the recovery began in 2021.

Despite this, however, rates still don’t justify newbuilds due to the increased costs of vessel construction. An analysis by Tidewater suggests rates need to increase to $38,000/day with utilization at 90 percent to justify ordering a $65 million newbuild to achieve its cost of capital over a 20-year life.

No newbuilds, rising demand and limited supply mean both vessel costs and day rates will continue to climb.

Limited vessel supply also means that those on the market need to operate more efficiently with full visibility for ESG requirements, and ABS has been working with operators such as Edison Chouest Offshore (ECO), which operates a fleet of nearly 300 vessels, on its decarbonization journey with greenhouse gas inventory and sustainability reporting services.

Carbon accounting, also known as a greenhouse gas (GHG) inventory, is the process by which organizations quantify their GHG emissions. Quantifying emissions provides insights to organizations so they can understand their climate impact and set goals to limit emissions. This helps manage carbon compliance risks, meets the requirement for emissions reporting and addresses stakeholder expectations.

“It’s ECO and ABS’s collective commitment to transparency and environmental and social stewardship that led us to collaborate with ABS on sustainability reports that set a new standard in corporate responsibility,” stated Bryan Rousse, ECO’s Sustainability Coordinator.

2024 and Beyond

While renewables are working through a rough patch, overall the offshore energy industry is looking strong into 2024 and beyond. Future investment in infrastructure and storage technologies will play a key role in accelerating the transition while continued investment offshore will keep the home fires burning.

The energy mix, still driven primarily by oil and gas, is benefiting from operational efficiencies and the smart use of assets. GHG planning helps offshore assets operate more cleanly and efficiently than any other time in history.

The future is looking bright.

Sean Hogue is Senior Vice President of Operations for Baker Energy Solutions.

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