OSV overcapacity in the Gulf?
February 26, 2013
Gulf shipyards are bursting at the seams with OSVs. The
newbuild OSV business for TY Offshore,
Eastern, Bollinger, LEEVAC and
other yards is good, and, based on their backlogs, it should stay that way into
At the International
WorkBoat Show in December, TY CEO John Dane estimated that 61 high-spec DP
OSVs were underway in the U.S. Since then, more OSV contracts have been
Driving demand is a deepwater market that many feel is just
entering a period of sustained growth. There are about 183 rigs under
construction worldwide with 63 options through 2016. And, Dane said, “These
rigs are all going to need boats.”
However, some small operators are worried about future
overcapacity problems in the OSV market, pointing to Harvey Gulf and Hornbeck.
Both operators are stretching existing boats and building
new ones at a steady pace.
Hornbeck is having six of its Super 200-class, DP-1 OSVs
stretched 40' and converted to DP-2 at Bollingerat a cost of $50 million. Redeliveries are scheduled for April, May,
and two each in August and December. Hornbeck also announced that it is
increasing its fifth OSV newbuild program by four vessels, to 24, and intends
to build up to eight Jones Act-qualified multipurpose supply vessels. The MPSVs
will service the Gulf subsea construction and inspection, repair and
maintenance market that Hornbeck and others expect to significantly grow
beginning in 2015.
Bollinger is also stretching five of the nine OSVs Harvey
Gulf purchased from Bee Mar last year. The 210' Busy Bee-class PSVs will
be extended by 40'. Harvey Gulf also said it is close to announcing a deal to
build two Jones Act-compliant offshore construction vessels — 328' and 360'.
In addition, Aries Marine recently awarded a contract
to LEEVAC Shipyards to build two DP-2, 270' PSVs, and BAE Systems
Southeast Shipyards will build two 252' PSVs for Jackson Offshore
Operators with options, rumored to already be exercised, to build two more.
If business continues to go well in the deepwater Gulf, then a glut in the high-spec DP-2 OSV market may not materialize.
However, with some deliveries stretching into 2015, that means business must
chug along until at least 2016. Only time will tell.