Value of existing units going up
Larilla TempletonOnce considered the proverbial stepchild of the offshore industry, the liftboat - the most versatile craft operating in the Gulf of Mexico - is taking on an ever-expanding international image. For many years, liftboats have been viewed as a unique Gulf of Mexico solution. Today - thanks in no small part to an oil business that's becoming more flexible by the year, and more willing to share tasks, risks, and technology - this perception, together with a lot of other traditional notions about liftboats, is changing.
Robert Alario, the president of OSMA, has stated: "Since 1998, the unique liftboat industry has seen its fleet evolve from a mishmash of highly functional but relatively small, unsophisticated and uninspected vessels operating almost entirely within shallow Gulf of Mexico waters, to a fleet of large, well designed, deepwater, multifunctional pieces of equipment which are, more and more, beginning to poke their noses into the international market."
For almost forty years, the liftboat industry has been fighting vigorously to earn its way in the highly competitive offshore marketplace, and now - having moved from minor player to major participant - it stands ready to take on an expanding role in offshore operations around the world. Liftboats have evolved into vessels capable of working just about anywhere oil and gas is found.
Born of need and necessity, liftboats originated along the bayous of South Louisiana as a "homegrown" technology, a means to an end. The first vessels were built by men who knew exactly what they wanted. The bays and coastal waters held no secrets from them.
Original conceptThe original intent wasn't all that ambitious - to design and build an easily deployable work vessel that would provide support for the fixed platforms popping up in the Gulf of Mexico. The work vessel would come alongside the platform, elevate to deck level, and then offload its cargo onto the platform.
This objective gave birth to a utilitarian design which combined the shape and capability of the conventional crane/deck barge, the legs and jacking system of the MODU, and the propulsion of the standard workboat - to wit, a liftboat, cheap to own, and easily repairable with tools and skills carried onboard.
Design and construction would follow an experiential learning curve. These men had no practical need for complex calculations and sophisticated drawings. Practical experience was the knowledge they trusted and understood - they knew how to build a boat to suit a purpose.
When ready to begin, they would discuss among themselves, occasionally taking chalk or pencil in hand to scribble a calculation or sketch a diagram, using anything handy at the moment, maybe a scrap of paper or the shop floor. Technical expertise and its trappings would come later, after the storm that changed everything.
As one might imagine, the first liftboats were small, most grossing less than 15 tons. Operating in shallow bays and coastal waters, the new vessels soon demonstrated a functional versatility that surprised both owners and clients alike.
Compared to anything else in the Gulf, the new vessels could adapt to a greater variety of work situations, mobilizing and demobilizing quickly. And there was the economic advantage to consider. For example, in the transfer of heavy equipment to and from fixed platforms, what could be accomplished by a liftboat in just a few hours might take several days for a crane barge and tug. Soon, there was a general consensus among those who counted in the offshore industry - liftboats were here to stay.
Oil activity migrated further and further offshore, creating a demand for larger and larger liftboats. Using knowledge gained through practical experience, liftboat owners responded by modifying the initial designs to meet the ever increasing demands of the offshore industry. Boats would soon become bigger, more seaworthy, capable of working at greater depths, but there would still be a lack of design sophistication.
What changed everything1985 was the year Hurricane Juan entered the Gulf of Mexico and changed the liftboat industry forever. The wrath of the storm will long be remembered by those who work in the offshore industry. Juan circled in the Gulf for several days, as if determined to sink every vessel out there. Most liftboats made it to port safely, but a number of those evacuated at sea went down. The time for change was at hand. Soon, the strangers would come - men with clean fingernails carrying sliderules and calculators.
Regulations carry both blessing and curse and, depending upon the particular point of view, always more one than the other. Most owners and operators realized - with the boats venturing into deeper, less protected waters, and insurance premiums rising - that the time had come for rules and regulations.
Some, with an eye on international markets, were even less resistant to change, knowing that USCG inspection and certification was the first step toward internationalization. But there was yet another reason - a deeper, more abiding concern. The liftboat industry was composed of friends and family members. The men and women of the bayou country didn't want to lose a crew.
USCG study groupNVIC 8-91 initiated the inspection/certification process. Most existing liftboats operating in the Gulf of Mexico were "grandfathered" under the provisions of NVIC 8-91. The USCG also set up a study group to evaluate liftboat design, practices, safety and operational patterns. The following quotes are taken from the interim report for select project 9614, Development Of Standards For Liftboats, published in January 1989:
"The objective of this select project is to survey the causes of past casualties to liftboats and suggest new design and operational standards to reduce the liftboat casualty rate.
"In this NVIC (8-81, Change 1), intact stability and leg strength criteria developed for Mobile Offshore Drilling Units (MODUs) are applied to liftboats because of the apparent similarity in hull form. However, it is recognized by the Coast Guard that these criteria may not be fully appropriate. There is a need for ongoing evaluation of these regulations both from within the Coast Guard and from the liftboat industry.
"The NVIC's intact stability requirements for restricted service are more severe than those used by the CFR or ABS, and further study is required to determine whether they are perhaps too restrictive, especially in light of the relatively few casualties attributed to inadequate intact stability..."
In September 1997, Subchapter L was established as the standard for new-built liftboats. Ironically, this new standard would prove to be even more restrictive than NVIC 8-91 or the international standards of classification societies.
Industry responseFor the first time in its history, the liftboat industry found itself yoked to a mass of regulations, and a strange load it was for these people. The response that it triggered was similar to a debriefing process, with the industry trying to unlearn construction practices and operation procedures that had been in place for almost two generations, while simultaneously trying to internalize new ideas and unfamiliar methods. Not as simple as one might think at first glance.
The road to regulations was not without potholes. From the point of view of USCG personnel - those charged with protecting life, property, and the environment - too much had gone on for too long. They used what was readily available, the rules written for offshore service vessels (OSVs), later to be amplified by the rules written for mobile offshore drilling units (MODUs).
From the point of view of the liftboat industry, some of the rules just didn't make good sense, the ultimate put-down from practical, pragmatic people, who felt that too much regulation had been implemented with not enough input from those within the industry. However, in the final analysis, no one wanted to substitute one set of problems for another set of problems, not the liftboat industry, and not the USCG.
Liftboat owners and operators, those represented by the Offshore Marine Service Association (OMSA), set up a committee within OMSA to develop industry positions and liaise with the USCG to revise existing rules. Those familiar with the economics of the offshore industry knew that it was a dynamic, fluxional marketplace. If the liftboat industry was to continue competing effectively, there had to be some built-in flexibility in the rule making process.
In 1998, a group of owners, builders, designers, and operators of liftboats (OBDOL) loosely organized and joined in, hoping to hurry the revision process along. A quote from one of their position papers reads:
"It is readily apparent that the special capabilities and limitations of liftboats make them distinct from either OSVs or MODUs. In this sense, the modern liftboat is a design hybrid, needing a set of regulations solely dedicated to its unique blend of technologies and capabilities. These regulations will eventually come, but, in the meantime, there is an immediate need for an interim regulatory solution."
Defining a liftboatThe liftboat industry holds that the special capabilities and limitations of their boats make them distinct from OSVs and MODUs. For example, liftboats routinely deliver equipment to offshore installations but, unlike OSVs, rarely transport work crews. Their maximum speed, ranging from four to ten knots, renders them impractical as people movers. Liftboats do, however, serve as temporary flotels for work crews when in the elevated mode. The industry believes that limits on the number of persons accommodated should not be the same as those imposed on crewboats of similar tonnage. To quote again from the OBDOL position paper:
"In the offshore industry, there is a large demand for liftboats that can carry more than 36 PACS [current limit under Subchapter L], which means that an interim solution must be found, one that will allow owners, designers and builders to proceed forthwith."
Unlike MODUs, which of necessity are designed to withstand hurricanes, liftboats use their mobility to run from heavy weather. A liftboat can usually disconnect and demobilize within minutes, and must, if it is to make headway, leave before wave heights reach 3-6 ft. It makes little sense, then, for liftboat legs to meet the same design criteria as previously established for MODUs.
The liftboat Industry is in a state of flux. Liftboats - which were once little more than small barges with elevating legs cobbled to the corners - have become world-class vessels, classed by ABS, Bureau Veritas, and Lloyds, and capable of operating in 200 ft and greater water depths. Even though the modern boats are superior to the prototypes in every respect, the basic design formula, worked out by trial and error in the bayou shipyards of South Louisiana, remains unchanged. Modern sophisticated designs still employ a barge hull for maximum variable load, have one or two diesel engines for propulsion, and large spud cans for minimum penetration.
Lightly loaded spud cans coupled with ultra-fast jacking systems allow the modern boats to quickly redeploy. The new jacking systems elevate in a tenth of the time considered acceptable for MODUs, while continuously monitoring load conditions and adjusting for abuse. OSL's new jacking system is a prime example: instrumentation - integrated into the gear drives, power source, and controls - monitors the loading of each pinion, loading of the entire pinion set, jacking speed, and the general operational state of the entire system.
Today, the website, www.liftboats.com lists boats of all sizes and uses.
One example, the giant Prisa 110, carries one million pounds of variable deckload, and a 175-ton leg-mounted SEATRAX crane with 360 degrees of reach. This vessel recently underwent sea trials and will eventually be joined by the two sister ships currently under construction in Semco's Lafitte yard.
One unique design integrating the conventional OSV concept with state of the art liftboat engineering, originates out of Dynamics Marine in Luling, LA, where a 250 ft Class Liftboat, four-legged liftboat has been detailed to include a conventional V-hull shape. The liftboat would include a 175-ton crane with over 6,500 sq ft of deck space, including a 1.5 million pound deckload capability. The shipshape hull provides for better transit speed and seakeeping capabilities while also allowing for jacking up and down in seas up 8-10 ft. Also, incorporated into the hull, is a steerable port nozzle and bow thrusters for better maneuverability to and from the platforms.
Even larger boats are under construction. Four Trident boats, 165 ft by 140 ft in area, will carry 210-ton cranes. And there are several more large boats on the drawing board. Power Offshore, for example, is designing a boat similar in structure to the Prisa class vessels, and the plans include two of the 175-ton leg-mounted cranes.
These versatile craft will function as crane barges, pipe-laying barges, diver support platforms, workover and coiled tubing rigs, temporary housing for construction and service crews, and so on. Ultimately, the list of uses will be limited only by the vision of the operators and demands of the market. The driving force is always imagination and economics.
The cost of the new boats has become a catalyst for technological innovation, bringing them into direct competition with MODUs. Take the standard work platform as an example; it would seem to make little sense to employ a MODU, a vessel that must be towed and costs $100 million to replace. A self-propelled liftboat, classed and certified, can be built for $10-25 million, depending on water depth and operator requirements.
While the Gulf Of Mexico remains the chief theater of operations, some owners are moving their boats into international waters. Liftboats are working in Lake Maracaibo, Nigeria, and West Africa. Several US-built boats are operating in the Arabian Gulf. Halliburton's 181 ft by 90 ft Irish Sea Pioneer, the largest liftboat now afloat, has been certified for North Sea operations.
The future will reveal an increasing demand for liftboats for two reasons: (1) Modern versions can function efficiently and effectively in most of the world's offshore oil provinces. (2) No one can beat the price.
ConclusionThis brings us back full circle to the matter of regulations. The Coast Guard's purpose is to protect life, property and the environment, which begs the question: can the regulations be made to serve that purpose without doing undue violence to the economic viability of the Liftboat Industry? Compliance with the increased wind criteria alone adds 40% - 60% to the cost of new construction.
The USCG is in the process of reviewing the criteria in Subchapter L with a view to possible revision. Rear Admiral North USCG expressed concern in a recent letter to Robert Alario of OMSA with the impact the regulations of Subchapter L are having on the liftboat industry. "To help us strike a fair balance, we make every effort to engage industry and the public in the rulemaking process.
This possible revision by the USCG is not anticipated until the Spring of 2000, which begs yet another question: what happens in the meantime? The market has life of its own - it waits on no one. How do matters stand today?
Copyright 1999 Oil & Gas Journal. All Rights Reserved.