View non-flash version
LEGAL UPDATE The Revitalized U.S. Title XI Financing Guarantee Program Available To The Energy Industry by Art Dimopoulos, contributor The offshore oil industry is no stranger to Title XI financing. During the height of the offshore and onshore construction boom in the late 1970s and early 1980s, over $8.1 billion in approved Title XI transactions were in force cov- ering hundreds of ships, barges, lighters, tugs, supply boats and mobile offshore drilling units. The building fervor came to a screeching halt in the mid-1980s when the market collapsed. Private lending institutions and the Maritime Administration's (MarAd) Title XI program experi- enced extensive defaults. In the late 1980s and early 1990s there was a lull in Title XI financing with very few transactions. As of 1992, no new Title XI applications were approved, and the total amount of Title XI guarantees out- standing had dropped to approxi- mately $2.3 billion. With the changing of the world's geopolitical face, emerging markets fueled new opportunities. The world's fleet aged and the need to supply energy, raw materi- als and goods produced new demand. On November 30, 1993, the National Shipbuilding and Shipyard Conversion Act of 1993 was enacted. This expanded the Title XI program to include vessels built in the U.S. for foreign owner- ship and flag and authorized Title XI guarantees for shipyard mod- ernization and improvement. From 1994 to the present, Title XI projects have totaled in excess of $2.7 billion. Projects have included a self-elevating mobile offshore drilling unit for the Rowan Companies costing $174.9 million of which $153.1 million or 87.5 percent was financed through Title XI; and a recent $110.7 mil- lion semi-submersible mobile off- shore drilling unit for Noble Drilling Corporation of which $96.8 million was financed by Title XI. Approved Title XI transactions have covered a wide array of ves- sels including: anchor handling/supply vessels, articulat- ed tug and barge units, double skin tank barges, tractor tugs, lift boats, double hull product tankers and chemical carriers. The resurgence of the offshore industry and an increased thirst for energy demand - especially in Asia - have resulted in a revital- ized industry, which is reflected in the Title XI orderbook. As a result of increased offshore oil rig utiliza- tion and increased rates, new rig construction is once again under consideration. Despite the current lull brought on by the crisis in Asia, the long-term forecast is for continued growth and demand. Vessel Eligibility The types of vessels eligible for Title XI guarantees include pas- senger, cargo and combination passenger-cargo carrying vessels, tankers, towboats, barges (includ- ing offshore drilling units) and dredges. B0XC00LER THE ONLY B0XC00LER WITH NATURAL ANTI FOULING The WEKA boxcoolers are installed in all types of river and seagoing ships as well as in stationary vessels, dredgers and pontoons. Due to mounting water pollution hence the increased wear of cooling sytems, a closed circuit cooling system became necessary. The solution was and still is the boxcooler. The principle is based on the fact, that warm water by its lower density rises, thus causing a thermosiphon circulation. 4 Weka Copper Nickel boxcoolers have bol- ted connections isolated from hull structure. WEKAEEDEO WEKA MARINE BV, The Netherlands Tel. +31180-516588, Fax +31 180-516064 Distributed by: SHIPS MACHINERY INTERNATIONAL, INC. 8375 N.W. 56 Street Miami, Florida 33166 Telephone (305) 592-7350, Fax (305) 591-8223 Circle 312 on Reader Service Card MaK I B&wl PROPULSION SYSTEMS ^DIESEL ENGINES MADE IN GERMANY & GMT MOTOR-SERVICES HUGO STAMP, INC. AUTHORIZED DISTRIBUTORS & SERVICE CENTER WOODWARI3 ® TURBOCHARGER SERVICES Authorized Deder • MAN B&W • EGT - NAPIER • HOLSET - BANNEWITZ • STATE-OF-THE-ART COMPUTERIZED BALANCING • FIELD SERVICE WITH FACTORY TRAINED ENGINEERS • REBLADING WITH NEW OR RECONDITIONED COMPONENTS • ABB TURBOCHARGER REPAIRS, OEM' SPARE PARTS & EXCHANGES 24 HOUR SERVICE HOT-LINE 1-800-622-6747 (MSHS) Please visit our Web page at http://www.mshs.com 3190 SW4TH AVENUE - FORT LAUDERDALE, FL 33315 - PH: (954) 763-3660 FAX: (954) 763-2872 28 Circle 258 on Reader Service Card Maritime Reporter/Engineering News
