Crowley Maritime Corp. plans $800 million shipping fleet expansion

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31 Aug 2009

While other shipping companies pull back on new vessel building, Crowley Maritime Corp. plans to spend $800 million on its fleet over the next five years. The move reflects the confidence of the Jacksonville company, which hasn’t experienced the cargo slump that many trans-Atlantic shipping companies have felt in recent months.
The new fleet will allow the company to be more competitive in the West Coast and Gulf Coast petroleum hauling industry, pull heavier cargo and better operate a recent Alaskan acquisition, said Ed Schlueter, the company’s vice president of vessel management services.
“Our philosophy is that there will be ups and downs in the market,” he said. “We have been in business for 117 years and we’re looking at the next 117 years.”
The company, which had $1.6 billion in revenue in 2007, hasn’t experienced any “significant declines” but has felt a softening in the market, Crowley spokeswoman Jenifer Kimble said.
Crowley is handling the international trade slump better than many other shipping companies largely because its Latin American and Caribbean trade is in goods less affected by a decline in consumer appetites, said John Martin, president and CEO of port and shipping consultants John C. Martin & Associates LLC.
He added that Crowley was wise to keep its fleet prepared for a resurgence in cargo traffic, and shipbuilding could be more affordable as many other shipping companies have canceled or pushed back orders, thus creating potential for deals.
Crowley, which spent about $650 million on its fleet in the past decade, plans to build 17 articulated tug barges, which are tugboats attached to the stern of a barge, Schlueter said. The ships, whose capacities range from 155,000 barrels to 300,000 barrels, are more cost-effective than traditional petroleum tankers because they require a smaller crew to operate.
The ATBs also can be built in any of the more than 20 small-tier shipyards, whereas tankers need to be built in larger shipyards, which number only about three in the U.S. The company is also planning to order two 156-foot tugboats that will have 11,000 horsepower, which is about 4,000 horsepower more than the average tugboat.
This “next generation of ocean-towing vessels” can tow anything up to about 18,000 tons, Schlueter said.
Crowley also has signed a contract for two 400-foot heavy-lift barges that can be used to move rigs for the offshore drilling industry. The company plans to order four more barges and keep options for an additional nine.
Lastly, Crowley will add two 78-foot, 1,200-horsepower tugboats to the fleet of Yutna Barge Lines, which Crowley bought about three years ago, Schlueter said. The “pretty stubby little dude,” which entered the fleet in April, is special in that it can operate in the shallower drafts of the Kuskokwim and Yukon rivers in Alaska and in the ocean.
All the vessels will meet rules recently approved by the Environmental Protection Agency on emissions and what precautions need to be taken so petroleum doesn’t hit the water. The vessels can also be equipped to meet stricter EPA guidelines expected over the next few years.

Source: BizJournals