Luxury at Sea: The New Wave of Accommodation Vessels
“Floatels” are all the rage and, while they may not be the Ritz-Carlton, they’re close enough for hard-pressed offshore workers.
Super Bowl XXXIX took place in Jacksonville, Florida on Sunday, February 6, 2005 between the New England Patriots and Philadelphia Eagles. The Patriots won, 24-21, before 78,125 fans and countless millions around the world watching on TV. But what made the game especially memorable was the use of cruise ships as “floating hotels” to accommodate the overflow of visitors unable to find hotel rooms in Jacksonville, the smallest city to ever host a Super Bowl. The National Football League requires a host city to have a minimum of 17,500 rooms. Jacksonville had 14,000. And so the planning committee came up with the idea of docking cruise ships on the St. Johns River to make up the shortfall. Five cruise ships were “chartered in” – the Carnival Miracle, Seven Seas Navigator, and Holland America’s Volendam, Zaandam and Zuiderdam. The fans, and NFL brass who stayed on the vessels, loved it.
Types and Uses
It’s a long way from supersized cruise ships to a Comfort at Sea floatel or a Prosafe accommodation rig. But the demand for these specialized vessels is growing rapidly, which is good news for shipyards and the maritime industry generally, mired as it is in a cyclical decline. As the global search for new sources of oil and gas moves farther and farther offshore, and as wind farms continue to sprout in the North Sea and elsewhere, there is a growing need for vessels that can accommodate large numbers of workers for extended periods of time far from shore.
“It’s a matter of economics,” explains Peter Roberts, Business Development Manager-Offshore Wind, for Damen Shipyards. “Is it cheaper to shuttle crews back and forth every day or house them for weeks at a time on dynamically positioned vessels?” Damen is currently converting the drill rig GFS Labrador into an accommodation rig for offshore workers that will be stationed off the coast of Denmark.
Accommodation rigs are multipurpose vessels that can house large numbers of workers and also do repair work and other ancillary activities involved in offshore oil and gas production. Floatels, on the other hand, are “just floatels,” in Roberts’ phrase, loaded with amenities and aimed squarely at the wind farm market, where they are employed mainly in the construction phase. A typical offshore wind farm will have 100-150 turbines and take three to five years to complete. Rig workers have “a cowboy mentality,” explains Roberts, and are used to roughing it, so accommodation rigs often represent an upgrade for them. Wind farm workers, on the other hand, are really shore-based personnel, accustomed to the comforts of home and hearth and not used to being away at sea for extended periods of time. They prefer the relative luxury of floatels. Roberts says the wind market is “very important because it’s part of the future,” and Damen will build whatever types of vessels are needed.
It used to be that workers in the offshore oil and gas industry stayed on the rigs themselves or on small boats or barges, and for the most part they still do. But as the projects got bigger and the distances longer, a new type of vessel was needed. Thus was born the accommodation rig, most of which are vessel conversions. Sembcorp Marine, for example, which advertises itself as the number two builder of offshore rigs in the world, is converting a ropax vessel to a DP2 accommodation and repair vessel for Equinox Offshore. When completed later this year, the vessel – with the functional name of ARV3 – will have accommodation facilities for 450 workers and begin a five-year contract for Petrobras in Brazil.
Players and Markets
The big kahuna in accommodation rigs is Cyprus-headquartered but Norwegian-based Prosafe. Cecilie Ouff, Finance & Investor Relations Manager, told MarEx that “Prosafe currently has six DP rigs and five anchored rigs. The DP rigs can mobilize on their own from one field to another without the use of tugboats. For longer distances – between continents, say – tug boats or a heavy lifter would be used.”
In December the company announced a contract for a new rig to be built at Sembcorp Marine’s Jurong Shipyard in Singapore and scheduled for delivery in 2014 at an estimated cost of roughly $300 million. The 450-person-capacity semisubmersible will be DP3-certified and capable of working in harsh North Sea environments. Like other rigs of its type, it will have a portable gangway that connects to the production rig or FPSO to enable personnel to move freely and safely from one to the other, even in high seas. Commented Prosafe CEO Karl Klungtvedt, “We have ordered this unit as we continue to see strong demand in the high-end segment of the accommodation rigs market.”
In addition to the North Sea, major Prosafe markets include Brazil (not surprisingly) and (surprisingly) Mexico, where Pemex is struggling to maintain production and upgrade its offshore facilities. Upgrading means additional personnel and a place to accommodate them – tailor-made for Prosafe. In addition, Pemex is actively seeking new sources of oil farther and farther offshore to replace declining production from the Cantarell field. Other promising Prosafe markets include Australia and Southeast Asia, and the company recently secured its first contract in offshore western Australia. In West Africa, where conditions are less demanding, accommodation barges can largely fill the bill.
Of the 20 or so accommodation rigs operating worldwide, nearly half are in the North Sea, and more than half are owned by Prosafe. Its closest competitor, if you can call it that, is Floatel International of Sweden, which has two rigs and a third under construction. Six other companies own one rig each.
The Floatel Superior is a DP3 semisubmersible accommodation and construction support delivered in early 2010 and designed to operate in the world’s harshest environments. She can accommodate 440 people, all in single bed cabins, and is currently working for Statoil in the North Sea. The Floatel Reliance, delivered in October 2010, is a DP2 semisubmersible accommodation and support vessel designed for worldwide operation but excluding the North Sea. She can accommodate 500 people and is contracted to Petrobras in Brazil.
A third vessel, the Floatel Victory, is being built at the same Keppel FELS Shipyard in Singapore that built the previous two vessels and is scheduled for delivery in 2014. She will have DP3 positioning, a 10-point chain mooring system and accommodations for 500. “What Keppel has built for us previously has been well received by the market,” stated Peter Jacobsson, Floatel CEO, “and both units are now operating successfully. We have ordered this third unit as we continue to see strong demand for such highly capable accommodation vessels, and we believe we are well positioned to strengthen our offerings in this market segment.”
Floatels and Wind Farms
Comfort at Sea (yes, that’s the name) is a partnership formed in 2010 between Blue Water Shipping and International Shipping Partners and aimed squarely at the burgeoning wind farm market. Its fleet consists of 22 ferries, accommodation vessels and cruise vessels with capacities ranging to more than 1,200. The company states that “Given the offshore installations planned for the next 10 years, we expect the demand for offshore accommodation to increase during installation, and also for operation and maintenance.”
The wind farm market is proving to be a bonanza for the shipbuilding and maritime industries. Not only are new types of vessels required – from Wind Turbine Installation Ships to specialized crewboats – but the demand is here to stay as Europe strives to reach its 20/20 goal: 20 percent clean energy by 2020. In the U.S., it’s 20 percent clean energy by 2030, and nobody seems in a rush to construct offshore wind farms, although there are a few efforts underway, most notably Cape Wind.
“Even if they are built,” states Marcia Blount, President & CFO of Warren, Rhode Island-based Blount Boats, “they’ll be very close to shore and won’t need accommodation vessels.” Robert Socha, Executive Vice President of Marketing for New Orleans-based Bollinger Shipyards, agrees: “We haven’t seen a demand for this type of vessel in the Gulf of Mexico or elsewhere.” Blount also worries about the Jones Act implications of building such vessels in the U.S. and sending them to Europe to work. Nonetheless, if and when wind farms do take off domestically, she wants to be ready. And so she has licensed a design for a catamaran hull from South Boats, a leading U.K. builder of wind farm vessels. She says the design can be used for other purposes as well, and Blount Boats didn’t have a catamaran prototype previously.
Bridging the gap between wind farms and energy exploration is Netherlands-based Chevalier Floatels, which serves both markets. In Kazakhstan the company partnered with Royal Wagenberg to provide accommodations for 900 for an oil-drilling project in the Caspian Sea, one of the largest offshore projects in the world. Using various shipyards and design engineers, the company converted one cruise ship into a 310-passenger accommodation barge and built two brand new 320-passenger accommodation vessels. The entire design and building process took four months. In six months the ice-class vessels were on location in the Caspian Sea.
More recently, the company partnered with Holland Shipyards and Atlas Ship Delivery on the development of a new type of accommodation vessel for the wind farm market. The company’s aim was to “deliver a viable alternative to the existing trend of small crew transfer vessels, which are certainly suited for wind parks closer to shore. But the farther offshore, the more time is lost traveling back and forth. The alternative is to create a home base inside the park from which workers operate, thus reducing travel time and the need for additional crew transfer boats.” The result? Two identical 49-passenger vessels with a 30-day autonomous operating capacity. The vessels, the DP Galyna and DP Gezina, feature individual cabins, a fitness center, restaurant and dayroom. They are equipped with DP2 navigation, a cargo crane, container space and an Ampelmann heave-compensated gangway. Luxury at sea? You bet!
While accommodation vessels and floatels are a relatively minor niche in the maritime universe, they represent a fast-growing market. And as long as the demand for offshore energy (whether fossil fuel or wind) continues to expand, it will thrive. Beyond that, the possibilities are endless.
For example, a U.S.-company named Blueseed is planning an offshore incubation center that would get around restrictive visa requirements and attract foreign entrepreneurs to the U.S. Backed by, among others, PayPal founder Peter Thiel, the concept of a “floating city” 12 miles offshore Silicon Valley conjures up science fiction images. Ferries would shuttle the 1,000 or so workers to the mainland on an as-needed basis. The so-called “Googleplex of the sea” would focus on IT and software startups. Farfetched? You be the judge. – MarEx
Jack O’Connell is Senior Editor of The Maritime Executive.
The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.