The top five trends in tug and towage in 2024

Alternative fuels gain traction in tug construction

Tug owners need to invest in their fleets to decarbonise operations and are exploring feasible and commercially acceptable alternative fuels to diesel.

Biofuels have become a short-term solution for reducing net carbon from ship handling and port operations. From sustainable resources, they make a compelling choice due to availability and ease in converting engines from burning diesel fuels.

Svitzer has become a world leader in using carbon-neutral hydrotreated vegetable oil (HVO) biofuels for its tugs in the UK and is considering them for ports in Australia and Europe.

Fatty acid methyl ester (FAME) fuels are also considered viable drop-in fuels by tug owners. These still emit pollutants in ports, such as NOx and particulate matter, although less so than diesel, which should be dealt with for improving air quality in ports.

Some tugs operating in LNG export ports, such as three in northern Norway, are already using LNG fuel, with zero NOx and particulates emissions.

Sanmar is commissioning two escort 999-gt tugs powered by LNG for HaiSea’s fleet in in Kitimat, British Columbia, Canada. HaiSea Kermode and HaiSea Warrior were built to RAstar 4000 DF design and ABS class with two Wärtsilä 6L34DF dual-fuel engines and two Schottel SRP 610 thrusters, producing a top speed of over 14 knots and a bollard pull of 105 tonnes.

In the longer term, hydrogen and methanol are seen as the main decarbonisation solutions for tugs. Boluda Towage and Svitzer have committed to methanol for their future newbuildings and Fairplay Towage is seeking to build a fleet of hydrogen-fuelled tugs.

They will be watching Port of Antwerp-Bruges in Belgium, as it starts operating the world’s first hydrogen-fuelled tug Hydrotug 1, which was developed by CMB.Tech and built in northern Spain with BeHydro engines. It was named in December and is seen as a pioneer. The port authority will also be an innovation lead in methanol. It is commissioning Methatug, which was converted from diesel power with Anglo Belgian Corp dual-fuel engines as a green-fuel demonstrator with funding from the European Union.

Kotug Canada will be the first to operate newbuild methanol-fuelled escort tugs after it ordered two from Sanmar Shipyards to RAsalvor 4400-DFM design. These will escort tankers from the harbour limits of the Port of Vancouver to the open Pacific Ocean through the commercial shipping lanes of the Salish Sea as part of the Trans Mountain Expansion Project, when they enter service in 2025.

In the US, a consortium of companies led by Maritime Partners is building the world’s first hydrogen fuel cell and battery-powered inland towboat in the US. This will use methanol as the hydrogen carrier due to its easy onboard storage and adequate sourcing. They were waiting for US Coast Guard approval to begin its construction at the end of 2023. The latest plans include demonstrating Hydrogen One on the Mississippi in 2025.

Ammonia could be considered as a fuel to decarbonise towage. Amogy plans to retrofit a 1957-built tug with ammonia fuel-cell technology, with technical support from DNV, C-Job Naval Architects and Feeney Shipyard. It hopes to have the vessel in the water in 2024, demonstrating the viability of the technology.

In Japan, NYK will test one of the world’s first ammonia-powered tugboats, with partners ClassNK and IHI Power Systems, by converting an existing vessel for testing in 2024 or 2025.

Building major powers in towage

Market consolidation is well underway in the towage industry and was heading for a crescendo in 2023. Deals already announced and well underway will be completed in 2024 resulting in behemoths in the sector with strong bargaining power and huge global fleets.

It is hard to see how these takeovers and mergers can be topped in the future, but there is still room for other major players to acquire local operators and owners.

Boluda Towage is overtaking AP Moller-Maersk subsidiary Svitzer to bag the top position with the largest global fleet once its ongoing corporate purchase of Smit Lamnalco in completed. Boluda Towage currently has a fleet of more than 300 tugs distributed in the main ports of Europe, Africa, Latin America and Indian Ocean. This was built up through newbuilding deliveries and earlier acquisitions.

Svitzer remains the top owner with the largest fleet and continues to grow this through newbuilding additions – it was the most active in 2023 – and is likely to add many more tugs in 2024.

Some of these will be in Australia, as Svitzer is adding ASD tugs to the fleet it leases to mining conglomerate BHP to support bulk ore export on Capesize ships in Port Hedland.

Cheoy Lee Shipyards is building four escort tugs in China to RAstar 2800 design, with the first scheduled to be delivered mid-2024, while Med Marine is building a MED-A2285-series tug for this fleet renewal programme and for Svitzer’s new operations in Greece.

Svitzer Australia also expects to welcome two TRAnsverse design tugs it has ordered from Uzmar Shipyard in Turkey, for operations in Port of Newcastle. New South Wales.

Perhaps the biggest corporate deal yet to be completed will be the acquisition of Rimorchiatori Mediterranei by container shipping Mediterranean Shipping Co (MSC) subsidiary SAS Shipping Agencies Services from current owners, Rimorchiatori Riuniti and asset investor DWS Group.

Rimorchiatori Mediterranei has grown its operations through acquisitions of its own, including purchasing Keppel Smit Towage and its fleet in Singapore and Malaysia in 2023. It operates tugboats and provides towage in Italy, Malta, Singapore, Malaysia, Norway, Greece and Colombia.

MSC was operating tugs in ports in Italy, Portugal and the Netherlands through its Med Tug subsidiary so this corporate deal is a huge jump in its operations and places MSC within the top three owners.

In Latin America, SAAM Towage cemented its position as the fourth-largest fleet owner through the acquisition of Brazilian owner Starnav’s towage fleet. Its sale of the ports, terminal and logistics business in Latin America to Hapag Lloyd for US$1Bn has given SAAM Towage a warchest to complete more corporate acquisitions.

In the US, Seacor Holdings has sold 20 harbour towing vessels from its Seabulk Towing fleet to two buyers: EN Bisso & Son and Bay-Houston Towing Co.

The EN Bisso transaction includes 12 harbour towing vessels across ports in Florida and Alabama. Bay-Houston is acquiring eight vessels operating in Texas along the Sabine Neches Navigation District and in the Port of Lake Charles, Louisiana.

Seabulk said it would continue to own and operate a fleet of tugs and barges in support of its Caribbean terminal and bunkering operations, including the KSM joint venture with partner Kotug International, which acquired Seaways International in 2022.

In Q1 2024, a new owner will start operating articulated tug-barges in the US after Seacor Holdings and Crowley formed strategic joint venture Fairwater Holdings.

Digitalisation and automation innovations

Optimised tug operations, improved fleet scheduling and fuel conservation are key benefits from implementing digitalisation across the sector. Communications equipment on tugs enable remote monitoring of operations and diagnostics of issues impacting their performance and efficiency.

Tug owners would admit to being late adopters of digitalisation, but they were early implementers of automation as most newbuild tugs have unmanned enginerooms and remotely controlled fire-fighting systems.

The next drive will be automating winches, cranes and other deck equipment, removing humans from the risks of deck operations.

Artificial intelligence (AI) and machine learning will increasingly be adopted for onboard operations, vessel management, scheduling and deployments.

Owners can learn from P&O Maritime Logistics, which created an AI Safety Assistant powered by ChatGPT to support team members in HSSEQ administration. AISA provides crew and shore managers with answers to a range of questions, makes suggestions for further reading and has become a safety assistant to those on board.

AI can also be used to optimise tugboat voyages to ensure they are as safe as possible while reducing emissions for longer haul routes.

Tug owners and ports will use AI to optimise scheduling, vessel management, to reduce emissions and cut costs. Kotug International has developed OptiPort for intelligent tug scheduling and it is being rolled out in more ports and terminals. During 2023, OptiPort and Helm Operations’ Helm Connect were used together for schedule more than 75% of all towage jobs in the US ports of Los Angeles and Long Beach in California, Port Arthur, Texas and the port of Tampa, Florida.

Autonomous scheduling helps tackle congestion in ports by matching tugs to the exact needs of ships as they arrive and depart from these harbours and terminals.

Tug owners are also likely to implement internet of things platforms, such as Damen’s Triton to monitor operations, performance, emissions and machinery condition on tugs. With this information and insight, owners can undertake predictive maintenance to prevent alerts becoming issues and failures, causing downtime. Ropes will also have sensors to prevent high strain and failures causing injuries.

With more connectivity, tugs will need to be cyber secure and communications will need to be reliable. With low-latency connectivity, tugs could become more autonomous and be remotely controlled from shore enabling crew to be fully rested for towage jobs and shore managers to ensure vessels will be navigated safely.

LNG terminals bring new fleet opportunities

Rising demand worldwide for natural gas is leading to LNG export and import terminals opening in all regions and each one seems to need a new fleet of tugboats, which owners are happy to provide. This has led to new fleets entering service during 2023 and will do so far into 2024 and the rest of this decade.

Each terminal requries four or five tugs for escorting, handling, manoeuvring and docking LNG and LPG carriers.

Once there are sufficient LNG terminals, more import and export facilities will be required as energy companies build centres for producing alternative fuels, synthesised and environmental fuels for various industries. These projects will be accelerated in 2024 after COP28 brings a fresh drive to these developments and the demand for net-zero fuels.

There will be terminals for shipping green methanol, ammonia and hydrogen, all needing tugboat support and these vessels will need to be net-zero or even zero pollution to help other companies cut their scope 3 emissions.

As owners gain new contracts, charters and concessions, they will be under greater pressure to renew fleets with low-emissions and zero-emissions tugs causing demand to increase at shipyards into 2025 and beyond.

On top of this, infrastructure owners are also renewing, modernising and expanding their fleets. Suez and Panama canal authorities have contracted shipyards to build new fleets, with more than 20 tugs combined to fill these requirements, and that is not the end, as each has options for more deliveries stretching into 2027 and 2028.

Some owners will argue their diesel-powered tugs are more efficient and have lower emissions, especially if they comply with IMO Tier III and US Environmental Protection Agency Tier 4 standards, but there will still be a drive to build fleets of tugs using other fuels, such as hydrogen, which will need to be shipped to these ports and other destinations.

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