Applying the lessons learnt from the 2008 financial crisis, the OSV market has responded quickly to the global oil downturn, laying up vessels
In response to the demand destruction caused by the Covid-19 pandemic and oil companies cutting capex in response to the low oil price environment there were 40 OSVs laid up in the North Sea by mid-May, according to data from shipbroker Seabrokers. Utilisation for large platform supply vessels (PSVs) fell to 50% in May, well below the eight-year historical median of 79% for the month.
On the large AHTS side, utilisation in May was recorded at 55%, not far from the 59% median, indicating a healthier situation – or maybe a delay in response. Time will tell.
"West African unemployed OSVs had gone into lay-up as far afield as Europe"
Reporting from Nigeria, OSV market consultant Mads Hoeg told OSJ that that West African unemployed OSVs had gone into lay-up as far afield as Europe, but a few were in lay-up locally, too.
There was a little bit of activity in the OSV charter market. In the Russian Arctic, FEMCO took two PSV, Rem Arctus and Rem Cetus and the AHTS Magne Viking for three months’ work, with no rate details revealed.
During the month, there were only four trades in the OSV Sale and Purchase market. The only deal with a reported price was US$1.85M for the 2004-built, 6,000 hp Bridgewater 80, which was sold by Bridgewater Offshore to an undisclosed buyer. VesselsValue reported: “PSV and AHT/AHTS showed a small softening in values but [were] generally stable, considering the current global economic situation and oil price falls.”
Unsurprisingly, there were no newbuilding orders reported in May, according to VesselsValue. However, UK-based Sentinel Marine took delivery of Malin Sentinel, the final OSV in a US$188M newbuild programme with China’s Cosco Shipyard in Dalian.
Malin Sentinel joins the Sentinel Marine fleet of emergency response and rescue vessels (ERRVs) which operate in the North Sea, performing additional tasks beyond the traditional rescue vessel duties. Earlier this year, Sentinel Marine announced contract wins and extensions worth £36M (US$45M).
The last of nine vessels in the second phase of Sentinel’s newbuild programme,
Malin Sentinel has been built with Tier 4 engines to reduce emissions and greenhouse gases to near zero. Sentinel will add three further vessels under its phase three newbuild programme.
Sentinel Marine chief executive officer Rory Deans called Malin Sentinel “a landmark vessel” with “new levels of cost, operational and environmental efficiency.” He said: “Like the other vessels in our fleet, Malin Sentinel will provide far wider reaching service than response and rescue to keep offshore workers safe.”
Added Mr Deans: “Our vessels also operate as oil recovery, tanker assist and cargo-handling vessels, offering significant cost savings for our clients who would otherwise have to charter additional vessels.”
Sentinel Marine said the multi-role functionality of its new, purpose-built fleet offers an attractive proposition for operators to vessels that have been converted.
Sentinel Marine has 300 seafarers operating its fleet currently and this will rise to close to 400 when a further three enhanced spec ERRV newbuilds currently under commission are completed.
These new additions, which are being built at the same shipyard in China, will have increased dynamic positioning capabilities with a DP2 notation, firefighting class 1, oil recovery and liquid mud and dry bulk capacities.
On the demolition front, Tidewater Marine sold seven OSVs for recycling in Turkey, with year of build ranging from 1997 to 2003. Another OSV, the 1985-built 2,200 dwt Putford Enterprise was sold for recycling in Denmark.