# New tankers under construction.



## Rodney (Jul 21, 2010)

The following article appeared in todays newspapers. I draw your attention to the 1920 Jones Act and U,S. protectionism regarding U.S. ship building and U.S. coastal shipping being manned by U.S. crews. It's a help for our maritime industry.



Philadelphia Shipyard.

Jonathan Blakley


Scott Clapham peers down into a cavernous dry dock at the Aker Philadelphia Shipyard. He points to massive pieces of steel, some covered with a light dusting of snow. When assembled, they will form a 115,000-ton oil tanker.

It's one of two oil tankers being constructed for SeaRiver Maritime, a subsidiary of Exxon Mobil, costing $200 million apiece. It takes roughly 1,000 workers more than a year to build, and the shipyard already has orders for four more tankers and two container ships, says Clapham, the senior vice president of Aker Philadelphia. He says orders for large vessels have shot up in the past year.

"We've seen, since 2013, just a steady increase in demand for the ships, both here in Philadelphia and other shipyards across the country," Clapham says.


The energy boom in the U.S. is having a knock-on effect on the country's shipbuilding industry. Matthew Paxton, president of the Shipbuilders Council of America, says there is a relative boom in the construction of larger vessels at major shipyards across the country, especially oil tankers. He says three years ago, the tanker market wasn't even on the screen, but shale formations in North Dakota and Texas have changed that.

"All this oil is coming down to the Gulf Coast and we're going to need to move that oil around the United States to refiners," he says.

There are more than 15 oil tankers, along with hundreds of smaller tugs and barges, on order at U.S. shipyards across the country, according to the American Maritime Partnership. But it will take months, if not years, to build them.

In the meantime, the domestic energy supply is booming, yet oil companies cannot bring in foreign ships to help move the oil and gas around the country thanks to a 1920s federal law called the Jones Act. Tom Allegretti, the chairman of the American Maritime Partnership, says under the Jones Act, you can only move cargo between two ports in the U.S. under certain conditions.

"You need to do that on a vessel that is flagged under U.S. law, that is crewed by American citizens and that is built in a U.S. shipyard," Allegretti says. He says the Jones Act helps create jobs and keeps U.S. waterways in the hands of Americans.

But others say the Jones Act is pure protectionism for shipbuilders and unions. William Gray, an expert and consultant in shipbuilding, operations and regulations, says a lack of competition means the U.S. shipbuilders became less efficient and not as technologically advanced as builders in other parts of the world.

After A Downturn, Global Shipping Bets Big On Everything 

"The designing of ships and the engines for ships and the equipment for ships; the United States was not very good at figuring out how to do that," Gray says.

Gray says shipbuilding in the U.S. has declined dramatically since World War II, and that there are only a handful of major shipyards now. A good percentage of those vessels being built are ordered by the Navy. Gray says the industry cannot keep up with the demand for merchant ships at an affordable price.

"We have very few of these shipyards that we used to have that made the larger ships: tankers, bulk carriers and container ships," he says. He says the cost is about three times as much as you find in shipyards in China, Japan and South Korea.

Aker Philadelphia Shipyard's Clapham agrees the Jones Act allows U.S. builders to capitalize on the surge in domestic oil and gas. He says without that federal law, ships would more likely be built overseas.

"The Jones Act, with its requirement to be built in the U.S., greatly helps support the manufacturing facility that you see here," he says.

But until more tankers come on line, energy companies may have to rely more on rail, pipeline and road to transport the glut of domestic oil and gas.


Regards, Rodney


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## ben27 (Dec 27, 2012)

good day rodney.sm.today.06:26.re:new tankers under construction.the jones act,1920.it seems mr jones had vision.u.s ships for u.s.crews.pity it never happened in the uk.britich ships for britich seaman,(dream on)thank you for a very interesting post.regards ben27


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## Robert Bush (May 18, 2006)

My opinion the Jones Act is a rip off by not uncorrutable Unions and ship yards and politicians aided by US flag owners. Maersk have their nose in the trough too,

The cost of living in Hawai is an example.

Protectionism is always trumped by free trade


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## Wallace Slough (Mar 21, 2009)

Without the Jones Act, there would be no US Flag Merchant Marine. It's importance is critical in maintaining a small nucleus of trained merchant mariners available for emergencies. I agree with Ben27 that it is a shame that the UK didn't have similar legislation to protect it's domestic ship building industry and merchant mariners.


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## kewl dude (Jun 1, 2008)

When I sailed the Great Lakes one ship owner decided to re-flag his ancient Great Lakes built ship in Bermuda. Probably seemed to be a good idea to him. He flew in folks from the flag state to man the ship. 

Thing is the whole Great Lakes are under Pilotage rules meaning there needs be a Pilot on board at all times. Saw that ship anchored all over the place waiting for pilots. 

Also every time they came into a US or Canadian port all the usual customs and immigration folks would be waiting for them. Ship could not carry cargo between US ports so was limited to trade between Canada and US. Whole deal came and went away in the summer portion of one season. The ship was scrapped.

The US ship yards are few but those active build some nice ships. Here in San Diego we have http://www.nassco.com/ which builds mostly for the US Navy. But also commercial ships.

http://www.nassco.com/products-and-services/comm-dc/commercial-ship-portfolio.html

http://tinyurl.com/nkxfqw8

Commercial ship portfolio dating back to 1960. 

Currently they are building four 50,000 ton product tankers that will come equipped for easy conversion to burn Natural gas.

Attached:

NASSCO-ECOTANKER-GLAMOURAPT-060413LG.jpg (107.3 KB) 

Swiped from NASSCO site.

The Jones Act is a Cabotage law, MOST maritime countries have Cabotage laws. In the US it is mostly farmers who want to do away with the Jones Act. So they can bring cheaper 3rd world vessels and crews to carry their products on US inland waterways.

There are those in the US who seem to think they should pay as little as possible for a service. While of course charging US prices for their farm products. Some folks just have a ME identity, they do not have national interests in mind, only their personal higher profits.

Greg Hayden


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## ben27 (Dec 27, 2012)

good day wallace slough.sm.17th march.2014.05:42.#4.re:new tankers under construction.thank you for your view on the jones act.i hope they keep the seaman of the u.s.a.in jobs on u.s ships.they should try some law to put britich seaman on britich ships.it may happen.(live in hopes)regards ben27


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