By his own admission, Mike Meade is an upstart who is good at starting up – and developing – companies.
While he learnt his trade working for some of the sector’s biggest names he says that often these entities need conformists, which is why he choose to forge his own path. “We parted on the best of terms and today [former employers] Seacor and Swire Pacific Offshore rank among my best customers. The key thing was never to burn any bridges.”
Since striking out on his own and setting up M3 Marine in 2005, Mr Meade has seen both the highs and lows of the industry. M3 Group has three subsidiaries which offer consultancy, brokerage and valuation services. The brokerage was the most vulnerable during the downturn. “We didn’t lay anybody off but we allowed natural attrition, so numbers went down from 14 to about seven. In 2016 I had to make the decision whether to start to let people go or invest, because the business wasn’t generating any cashflow. I decided to invest. It was a sound decision because in 2017 it turned the corner and in 2018 things are better – notice I didn’t say ‘good’, I said ‘better’. I reckon it is going to be another six years before you see wholesale ordering of OSVs, drilling rigs, and so on. You will see one or two specialist things being ordered for specialist markets, but not the wholesale ordering of days gone by.”
He is equally clear that digitalisation will disrupt the market, but it too has yet to meaningfully arrive. “We are still waiting for the key game changer, an ‘iPhone moment’ in shipping. We’ll know it when it’s here.” Mr Meade has placed his bets on drone and small ROV inspections. “We started that about a year ago and are working with the Singapore MPA and a few other bodies to develop tools and methods to underpin innovative ways of inspection work.” One example is taking cathodic protection readings of difficult-to-reach spaces utilising ROVs.
His staunch view is “we are in a survival rather than an innovative market”. Talk of innovation in the present market he says is ‘overplayed’; he’s read with interest the column inches devoted to two new Seacor vessels fitted with spinning reserve batteries and sees it as ‘interesting, but not earth shaking’.
“Reducing your fuel burn with low sulphur fuel and having a spinning reserve is a worthy concept. But with the DP redundancy concept you need spare power and what tends to happen is that spare power is engine driven. This means you are burning a lot of fuel to keep the redundancy in play. So, on these vessels any excess capacity generates the spinning reserving batteries. In the event of a failure the batteries kick in. This is quite different from true hybrid power, which in time will be the way forward.”
He offers is a similarly qualified view on autonomous vessels. “These are going to be ok for short sea trades, where you have a specific cargo that is the same every day and goes from A to B. [But] you are never going to get a DSV alongside a platform with divers out with no control on the bridge.” Mr Meade odes however anticipate fewer crew onboard, replaced by a lot more controls, a lot more cameras and a control centre monitoring operations. We do have a lot of inefficiency in the business and this is where you will see the change.”
Mr Meade is optimistic on the immediate future: “We have employed new people this year because, as vessels start to reactivate, they need more surveys, audit inspections and reactivating these new ships is not as easy as people think. Nobody had ever laid up wholesale fleets of DP2, diesel/electric, electric-controlled ships in environments like China and Bhutan and Malaysia, where you have over 65% relative humidity, 100% of the time. Even, warm-stacked vessels when reactivated won’t be immune from problems.”
Numbers on the brokerage side have also grown. “We are not seeing an increase in chartering and that increase in chartering will not come for some time,” he stresses. “What we are seeing is increasing utilisation."
Capt Meade will present a regional analysis at the annual Offshore Support Journal Conference, Awards & Exhibition in London 6-7 February 2019.