China Nears Completion of Land Reclaimation

By Reuters 2015-06-16 14:52:11

China will soon complete some of its land reclamation on the Spratly islands in the disputed South China Sea, the Foreign Ministry said on Tuesday, indicating that Beijing is close to setting up new outposts in the maritime heart of Southeast Asia.

The Foreign Ministry did not identify which of the seven reefs undergoing reclamation would be finished soon. Ministry spokesman Lu Kang said their statement was already “quite detailed”.

China stepped up its creation of artificial islands last year, a move that has alarmed several countries in Asia and drawn growing criticism from Washington. There have been recent tensions between the Chinese navy and the U.S. military around the Spratlys.

“Based on our understanding from the relevant authorities, in accordance with the set work plan, the land reclamation project for China’s construction on some islands and reefs on the Nansha islands will be completed soon,” the Foreign Ministry said in a statement, using the Chinese name for the Spratlys.

It gave no timeframe.

China claims most of the South China Sea, through which $5 trillion in ship-borne trade passes every year. The Philippines, Vietnam, Malaysia, Taiwan and Brunei also have overlapping claims.

Philippines defense ministry spokesman Peter Paul Galvez urged China to refrain from what he called selfish acts.

“We reiterate that their activities if not stopped only draws the world closer to further uncertainties and untoward incidents with irreparable consequences,” Galvez told reporters in Manila.

U.S. officials have said the pace and scale of China’s reclamation work far outstripped that of other claimants. One official has said that before January 2014, China had only reclaimed about five hectares, but this had soared to 2,000 acres (800 hectares), expanding the acreage on outposts it occupies by over four hundred times.

Recent satellite images show a hive of building and other work on the new islands.

Military facilities for example are under construction on Fiery Cross Reef, including a 3,000-meter (10,000-foot) runway and airborne early warning radars, which could be operational by the year-end, according to one U.S. commander.

The Foreign Ministry reiterated China’s stance that the islands would help with maritime search and rescue, disaster relief, environmental protection and offer navigational assistance as well as have undefined military purposes.

The construction was within the scope of China’s sovereignty, the Foreign Ministry said, adding it would not affect freedom of navigation and overflight in the South China Sea.

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Gulf Shipping and Oil Prepare for Tropical Storm

By MarEx 2015-06-16 13:58:57

Shipping and oil operations along the Gulf of Mexico completed preparations ahead of Tropical Storm Bill, which began pounding the Texas coast on Tuesday.

Traffic in the Houston Ship Channel, the biggest U.S. petrochemical port, was stopped on Monday to protect vessels from rough seas. The suspension of ship traffic in the 52-mile channel deeply affects the flow of crude oil and petroleum products as refineries and processing plants along the gulf depend on access to the channel.

Also, several firms, including Chevron Corp and Royal Dutch Shell, evacuated non-essential offshore workers over the weekend. However, output from oil platforms has not been affected in the U.S. Gulf, which pumps about a fifth of all domestic crude. Onshore, LyondellBasell said it was deploying sandbags at its refining and chemical facilities, and Shell said only workers essential to fuel production would work Tuesday.

According to the National Hurricane Center the storm made landfall South of Houston around noon Tuesday. Heavy rain had already drenched parts of Texas over the weekend, pushing already high rivers closer to overflowing their banks.

Flash flood watches were in effect for central Texas and the Houston area, regions where floods last month swallowed thousands of vehicles and damaged homes. Around 30 people have been killed in flooding over the past weeks.

Bill is the second named tropical storm of the 2015 U.S. Atlantic season after Ana, the U.S. National Hurricane Center said.

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China Nears Completion of Land Reclamation

By Reuters 2015-06-16 14:52:11

China will soon complete some of its land reclamation on the Spratly islands in the disputed South China Sea, the Foreign Ministry said on Tuesday, indicating that Beijing is close to setting up new outposts in the maritime heart of Southeast Asia.

The Foreign Ministry did not identify which of the seven reefs undergoing reclamation would be finished soon. Ministry spokesman Lu Kang said their statement was already “quite detailed”.

China stepped up its creation of artificial islands last year, a move that has alarmed several countries in Asia and drawn growing criticism from Washington. There have been recent tensions between the Chinese navy and the U.S. military around the Spratlys.

“Based on our understanding from the relevant authorities, in accordance with the set work plan, the land reclamation project for China’s construction on some islands and reefs on the Nansha islands will be completed soon,” the Foreign Ministry said in a statement, using the Chinese name for the Spratlys.

It gave no timeframe.

China claims most of the South China Sea, through which $5 trillion in ship-borne trade passes every year. The Philippines, Vietnam, Malaysia, Taiwan and Brunei also have overlapping claims.

Philippines defense ministry spokesman Peter Paul Galvez urged China to refrain from what he called selfish acts.

“We reiterate that their activities if not stopped only draws the world closer to further uncertainties and untoward incidents with irreparable consequences,” Galvez told reporters in Manila.

U.S. officials have said the pace and scale of China’s reclamation work far outstripped that of other claimants. One official has said that before January 2014, China had only reclaimed about five hectares, but this had soared to 2,000 acres (800 hectares), expanding the acreage on outposts it occupies by over four hundred times.

Recent satellite images show a hive of building and other work on the new islands.

Military facilities for example are under construction on Fiery Cross Reef, including a 3,000-meter (10,000-foot) runway and airborne early warning radars, which could be operational by the year-end, according to one U.S. commander.

The Foreign Ministry reiterated China’s stance that the islands would help with maritime search and rescue, disaster relief, environmental protection and offer navigational assistance as well as have undefined military purposes.

The construction was within the scope of China’s sovereignty, the Foreign Ministry said, adding it would not affect freedom of navigation and overflight in the South China Sea.

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North Sea Job Cuts Raise Skills and Safety Concerns

By Reuters 2015-06-16 09:16:58

Cost-cutting in Britain’s North Sea oil and gas sector could lead to more acute skills shortages in future, industry experts have warned, with some expressing concerns that safety could be compromised.

A plunge in crude prices over the last 12 months has prompted oil majors such as Royal Dutch Shell, BP, Chevron and ConocoPhillips to lay off hundreds of workers.

Oil field services groups such as Amec Foster Wheeler, Wood Group and Petrofac are also in consultation with employees over job cuts.

“We have seen a lot of panicking,” said Alastair Cole, a director at Spencer Ogden, an energy recruitment agency. “We’ve seen some very quick decisions made to balance the books in the short term, and there’s going to be a big gap in the future.”

A report published in February by Britain’s Oil and Gas Authority found that firms had significantly reduced staffing levels and contractor rates.

“The (cost-reduction) programs should recognize the risks of potentially losing key skills and expertise required for the future. Great care must also be taken to avoid adverse impacts on safety, the environment and maintenance programs,” it said.

Many experienced older workers are also opting to hang up their wrenches in favor of early retirement, just as ageing platforms need more specialist care and attention.

“Not only do we have installations that have been out there 20 or 30 years, but many of these installations also have a significant number of people on them who have been there from the beginning. So knowledge transfer is an issue,” said John Wishart, president of Lloyd’s Register Energy.

It’s a huge turnaround from the situation last summer when companies were struggling to recruit senior project managers of the right caliber, leading to rampant wage inflation.

“My worry is that we could take it too far,” said Brian Campbell, a director at PwC. “Then when the oil price goes back up and everyone is scurrying around for the same talent, rates could go through the roof and we’re back to square one.”

MIND THE GAP

Similar cut-backs in previous downturns created gaps in the industry in the mid-career age group of 35-45 year-olds. This led to accelerated promotions, with talent hired away by other organizations and some people promoted ahead of their competency level, industry participants say.

Cole said he knew of people retiring early because of worries that in a few years’ time, the supervisory levels offshore would be filled by less experienced people.

He cited the example of an offshore installation manager who said that since the downturn of 2008, people could be promoted up the ranks of an offshore rig in 4-5 years, rather than the minimum of 15 years that it used to take.

“It doesn’t mean they’re better – it’s just a necessity. He said that will become a safety issue and he doesn’t want to be there when something goes wrong,” Cole said.

Some industry veterans point out that younger managers have no direct memory of the 1988 Piper Alpha disaster, in which 167 men died after a gas explosion.

That accident occurred against a backdrop of industry cost-cutting adopted after the 1986 oil price plunge – a similarity that is ringing alarm bells with some.

“The scars and memories of an event like Piper are leaving the industry,” said one engineer with 33 years in the sector. “The deaths from Piper were a result of lots and lots of small but very bad decisions. Those same decisions are being taken today, I see it consistently in my work.”

As a result of Piper Alpha, offshore safety has been radically overhauled, reducing fatalities to very low levels, but some fear that as collective memory fades, standards will start to drop again.

For their part, North Sea operators insist that safety remains paramount. Commenting on job losses back in March, Shell’s upstream vice president for the UK and Ireland, Paul Goodfellow, said changes would be implemented without compromising Shell’s commitment to “the safety of our people and the integrity of our assets”.

LOSS OF EXPERIENCE

A December 2014 study by Ernst & Young estimated that around 38,000 full-time workers were expected to retire between 2014 and 2019, out of a total workforce of 375,000.

But David Gibbons-Wood, director of the Centre for International Labor Market Studies at Robert Gordon University, Aberdeen, said that where companies are undertaking redundancy programs, it will accelerate exits.

Thomas Helmer, who worked in the industry for almost 40 years as an engineer and manager, and now works for a crisis management company, said he was concerned about the loss of “a phenomenal amount of experience in a very short period”.

“The key to risk management is knowing what can go wrong,” he said. “If you don’t have that knowledge and experience you will not select and implement the appropriate controls.”

He said problems with current safety procedures included flawed management of corrosion defects, some deluge testing being overdue and poor controls over temporary equipment. He added an increase in bureaucracy over the years had kept supervisors behind desks rather than walking the floor.

“It is true that the offshore industry has become safer if you look back, but that does not mean a major event cannot happen.”

By Claire Milhench

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Next Generation Offshore Helicopter Announced

By MarEx 2015-06-16 11:57:02

Airbus has entered the development stage of a next-generation helicopter designed for oil and gas missions.

The two-year concept phase start-up for the new X6 helicopter was announced yesterday at the Paris Airshow. The X6 will be heavy-lift rotorcraft is aimed at improving fuel efficiency as energy companies look to newer, more efficient helicopters to help mitigate costs amid low oil prices.

“It will be smoother, more comfortable, lower levels of noise … And a much higher level of fuel efficiency,” Airbus Helicopters Chief Executive Guillaume Faury said.

The X6 is widely described as a successor to the Super Puma, a workhorse of the offshore oil industry. It will be Airbus’ first civil helicopter equipped with fly-by-wire technology, which reduces traditional manual flight controls with electronic interfaces tied into onboard flight control computers. Fly-by-wire technology reduces the overall weight of the helicopter, allowing for increased fuel efficiency. Additionally, the electronic control system monitors pilot input to make sure the craft is always within the flight protection envelope. The technology is already in use in many of the company’s airplanes.

“[The X6] will set new standards in the industry not only for design, but for its production strategy as well, as we will rely on the industrial capacities of our core countries,” explained Faury. “Our objective is to bring to the market the most efficient helicopter solutions adapted for how our customers’ needs and the industry itself will evolve in the future.”

Airbus will be designing the helicopter in close collaboration with a customer advisory panel to ensure that the helicopter meets desired industry specifications.

The helicopter will be able to accommodate up to 19 passengers and will be all-weather ready – including full de-icing – from the first delivery. While, initially targeted to the oil and gas segments, the X6 will also be suited for Search and Rescue operations.

Once the main architechture and design has been achieved in the concept phase, a development phase will follow, leading to an X6 entry into service anticipated in the 2020s.

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Cruise Ship Recues 41 Following Boat Fire

By MarEx 2015-06-16 10:05:53

The Holland American ship MS Noordam came to the rescue of 41 passengers stranded in Glacier Bay National Park following a tour boat fire.

The Baranof Wind, a 79-foot sightseeing boat, experienced an engine fire in the afternoon of June 10. The crew aboard the boat were able to contain the fire, however the boat was left partially disabled in the upper portion of Glacier Bay near John Hopkins Glacier.

The MS Noordam responded to a call for aid at approximately 12:35 p.m. local time. The ship lowered a tender, which collected 40 tourists and one Glacier Bay National Park ranger and returned to Noordam.

“We are proud of the proficient response Captain van Donselaar and his team executed in assisting the passengers of Baranof Wind,” said Orlando Ashford, president of Holland America Line. “Our crewmembers are highly trained to respond when needed and we were fortunate to have been nearby to provide support.”

The sightseers were brought to Bartlett Cove, where the Baranof Wind excursion originated, at approximately 5:30 p.m. local time. Noordam then sailed for its next port of call, Ketchikan, Alaska, where it arrived on Thursday, June 11.

In 2012 another Holland America ship, the MS Volendam, similarly rescued 76 passengers from the Baranof Wind after the vessel struck a rock and began taking on water. The incident also occurred in Glacier Bay National Park.

The MS Noordam was in the middle of a seven-day Alaska cruise that sailed roundtrip from Vancouver, British Columbia, Saturday, June 6.

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