April 14, 2025 • 59 mins
America's maritime dominance has quietly eroded over decades, with our ocean-going commercial fleet shrinking from nearly 3,000 ships in 1960 to just a few hundred today. Meanwhile, China's fleet has exploded to over 9,000 vessels. This stark contrast sets the stage for our fascinating conversation with Aaron Smith, President of the Offshore Marine Service Association (OMSA; offshoremarine.org), who brings us inside the world of vessels powering our offshore energy sector.
Aaron reveals how the offshore vessel industry began with repurposed shrimp boats and mothballed WWII vessels before evolving into purpose-built technological marvels. Today's offshore service vessels are essentially maritime pickup trucks – delivering everything from construction materials to people, fuel, and supplies to offshore installations. The industry seamlessly supports both traditional oil and gas operations and renewable wind energy development, with many vessels capable of switching between sectors with minimal modifications. Beyond energy production, these capabilities directly impact national security. When Chinese vessels cut undersea telecommunications cables, America needs the capacity to respond.
So how do we grow?
Oil and gas and offshore wind need many of the same things to grow - stable financial and development policy allowing long-term investments in ships and workforce, subsea innovation, and collaboration across dual-use communities of the military and the private sector.
The maritime industry offers exceptional career pathways. Without requiring college degrees, committed workers can rise from entry-level positions to six-figure incomes within six years. This upward mobility represents the American dream in action – with many company owners having started as deckhands themselves.
It's all hands on deck, so let's go!
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:11):
With all that's going on.
I wouldn't be surprised if youmissed it, but last week the
White House released anexecutive order restoring
America's maritime dominance toaddress national maritime
capacity and capability concerns.
It's no secret that USocean-going commercial and
military shipbuilding hasatrophied over the last 60 years
.
In 1960, the Americanocean-going fleet had almost
(00:34):
3,000 ships of over 1,000deadweight tons.
Today there are just a fewhundred.
China, in contrast, has over9,000 ships of the same size.
But what about the fleetsupporting offshore energy?
Jim and I got a chance to speakwith Aaron Smith of AMSA to
understand how we got here andhow we need to grow next on the
(00:54):
Offshore Energy Podcast.
I'm Jim Bennett and I have over40 years of experience
developing energy in the ocean.
I'm Ian Vopero and I've spentthe last 20 years developing
(01:16):
offshore energy projects aroundthe world, and this is the
Offshore Energy Podcast.
Speaker 2 (01:26):
Hey Jim, good morning , how are you?
Good morning, Ian, how are you?
You ready for another podcast?
Speaker 1 (01:30):
Jim, I noticed you stepped right past how you are,
so I'll just say it I'm veryconcerned about our current
trade policies, the financialmarkets and the impacts all of
this is having on everydaypeople like us.
But I'm ready to talk aboutsomething more fun, and what
better way than spending sometime with you and talking about
offshore energy?
Speaker 2 (01:51):
huh, I think you got a great point.
These market things willcertainly go up and down and
they're of great concern andthere are long-term impacts.
But when the ship's got to runand the boat got to sail and
that's what we're going to talkabout- I love it, jim.
Speaker 1 (02:08):
What a transition.
The ships got to run, the boatsgot to sail and today we are
really lucky to have Aaron Smithfrom AMSA joining us to talk
about ship sailing and offshorevessels supporting the maritime
industries, particularly aroundenergy.
Aaron, how are you?
Good morning, I'm doing great.
How are you?
Gents doing sailing an offshorevessel supporting the maritime
industries, particularly aroundenergy.
Speaker 3 (02:28):
Aaron, how are you Good?
Speaker 1 (02:30):
morning I'm doing great.
How are you gents doing?
Jim and I always banter aboutthe weather.
So I'm up here in New Englandit is still winter, even though
we are well into April, and,aaron, I noticed that you are a
little lighter dressed than I.
I hope the weather is nicewhere you are.
Speaker 3 (02:47):
I am.
I'm calling in from New Orleans.
Today it is beautiful, it's 71.
Just a great day.
Sun is shining, looking forwardto getting into festival season
.
We got French Quarter Feststarting this weekend, going
into Jazz Fest after that.
It's just really hard to getwork in at these times.
Speaker 1 (03:06):
Sounds really good.
Les et les bons temps roulés,monsieur.
All right, the good times roll.
Yeah, aaron, it's great to haveyou.
You know, will you do a littlepersonal introduction?
Share with our listeners whyyou're here, why you think, why
it's important to talk aboutoffshore energy and offshore
vessels in the United States?
Speaker 3 (03:26):
Well, certainly, certainly.
I'll start with the leastinteresting part about this and
talk about myself.
I spent 10 years on CapitolHill, working in mostly
transportation and energy policy.
During that time, I married agirl from New Orleans and for
anyone that's doing that, justknow you're, if you do that, you
will end up in new Orleans.
(03:48):
Regardless of where you find aspouse from new Orleans, you'll
end up in new Orleans, um, andso I realized that later and
then realized, well, shoot, Igot to figure out a way to get,
to get down there and to, to youknow, have make a living.
So, fortunately, I was workingfor a congressman that had
(04:09):
announced his retirement and atthe same time, there was a
freshman congressman named JeffLandry who had just won election
and he needed a transportationexpert, an energy expert, and
was able to link up with himexpert and energy expert, and
was able to link up with him andand just let me tell you that
that Jeff Landry is a great guyand he was so much fun to work
(04:30):
for.
So I spent ended up spending 10years on Capitol Hill.
The two I worked for Jeff.
I passed more bills andamendments than the other eight
combined, and most of that wasjust on his personality and his
just wanting to get stuff done.
So unfortunately Jeff lost inCongress.
(04:51):
But that opened up some otherdoors for him and he's now our
governor down here in Louisiana.
But it also introduced me tothe offshore service and supply
industry industry.
And so when Jeff lost, amsaactually was looking to start up
a dynamic positioning operatorcertification body, and so they
(05:11):
put me in charge of that andstarted that organization, grew
that organization and then a fewyears later they needed a
president and so came to me andI've been here about 10 years
now, so it's been great.
It's been great.
Speaker 1 (05:28):
It sounds great and for listeners OMSA, o-m-s-a
Aaron, it stands for.
Speaker 3 (05:35):
Yes, it stands for the Offshore Marine Service
Association.
We are the trade associationfor the segment of the US
maritime industry engaged inoffshore energy.
So our organization is 52 yearsold now, not surprisingly, like
most things in Louisiana,officially we are 52 years old.
Unofficially we date back tothe early 60s and we were
(06:02):
founded by the families thatfounded this industry.
These were the guys who tookwhen offshore energy developed.
It was kind of an afterthoughtof, well, how do we get
everything out there?
And so they took repurposedshrimp boats.
They took mothballed World WarII vessels and it wasn't until
the early 60s that we startedpurpose building vessels for
(06:23):
offshore construction.
And the families that startedthat the Labordes, the Cheramis,
the Ogerons, the Candys, theSchwest, the Terrios, the
Hilarios Don't worry, there willbe a spelling test at the end
of this they came together andfounded AMSA to support their
industry and support theirbeliefs, and so it's been great.
It's an amazing industry towork for.
(06:46):
It's so exciting, sointeresting.
For a boat nerd like me, I loveit.
Speaker 2 (06:53):
Well, that's great, aaron.
We really appreciate you beinghere.
I would like you to expand alittle bit, because our podcast
is, of course, ocean Energy, andit's certainly oil and gas, but
it's also wind.
We focus a lot on wind, andwhen we focus on wind, we have a
tendency to focus on it as anindependent kind of separate
(07:15):
industry, which it is not at all.
So if you could explain alittle bit more about what the
marine industry is, so that wecan get into a discussion of how
the two interact and how thingsare going to develop over time.
Speaker 3 (07:31):
Certainly so.
I think we're kind of.
You know, when people thinkabout maritime, they think about
ships that take things from onepoint to another.
You know international shipping.
Or they think about the bargesthey see on the Mississippi
River, the Ohio River, theIllinois Waterway.
They think about the bargesthey see on the Mississippi
River, the Ohio River, theIllinois Waterway.
They think about those.
We're different.
You have the brown water on therivers, the blue water in the
(07:53):
shipping.
We are offshore.
What we do is we takeeverything that is used,
consumed or is being builtoffshore or under the water and
we take that out there.
So you know, you think about.
You know, the way most peoplerecognize our industry is if you
(08:15):
think back to the pictures ofDeepwater Horizon and you think
about the rig that is burningand the vessels that are
spraying water on it.
Those are my member companiesand in fact the vessel that
rescued all of the workers whowere on the Deepwater Horizon
that night was the DamonBankston.
And, kind of interestingly,damon Bankston the man signed
(08:39):
OMSSA's Articles ofIncorporation.
So that is what we do.
We are the vessels that takeeverything offshore for, be it
wind or be it oil and gas, weare that link between America
and our offshore energy.
Speaker 2 (08:54):
Let me touch on that, because Macondo, of course, is
an unfortunate example, but itmakes your point about vessels
that service and are neededoffshore for all kinds of
activities, but it's not justemergency activities.
You're talking about a hugeindustry that constantly needs
(09:17):
service vessels, all kinds ofactivities that just to keep it
going in the normal sense, asopposed to the unusual situation
like we had with Macondo.
Speaker 3 (09:30):
It really is and it's .
We are out of sight, out ofmind.
You know we operate over thehorizon and usually the ports we
operate out of are not placespeople go.
You know, down here inLouisiana the main port is Port
Fouchon.
You know we now, with wind, weare in more populous areas and
(09:50):
so people are starting to seethe vessels that our member
companies run and so they'regetting some more information
about it, but it's still it'snot known.
You know you think about whathas to go into a project.
You know, if you think aboutyou're drilling a deep water
well in 8,000 feet of water well, that means you need 8,000 feet
(10:12):
of risers to connect the rig tothe ocean floor, and the oil
isn't at the ocean floor.
The oil is an equal distancedown below the seabed.
That means you need that muchdrill pipe and then you need
water, you need fuel to makethat work, you need people to
make that work.
Those people need food.
(10:32):
All of that has to be taken outand then constructed, and
that's what our members do withwhat are now purpose-built
vessels that are amazingtechnological masterpieces.
You know these vessels, at seastate, will hold position within
a meter and you're talkingabout a vessel that's 320 feet
(10:54):
long and can sit in eight-footseas without even moving.
It's really like I said, I'm aboat nerd and I love talking
about this stuff.
It's so interesting.
Speaker 1 (11:05):
Aaron, it's great to have you on.
I'm a boat nerd and I lovetalking about this stuff.
It's so interesting.
Aaron, it's great to have youon because I'm a boat nerd too,
as a former oceanographer aswell as an offshore energy
developer, so I love it.
It's very exciting.
You mentioned some of the.
Give us a little bit more aboutthe size and scale of the
industry in the US.
What do we have heredomestically?
How many vessels or the typesof vessels, that kind of thing.
Speaker 3 (11:33):
Yeah, so there are a bunch of different purpose-built
vessels that are used in ourindustry.
We also are constantly alwaysconverting and repurposing
modifying vessels to dodifferent things.
Modifying vessels to dodifferent things but our basic
platform is called an offshoreservice vessel or an offshore
supply vessel Same thing.
Internationally they're calledplatform supply vessels.
(11:54):
Look, I always say don't letboat guys name things, we're
just going to create a myriad ofdifferent and confusing names.
Just call them an OSV.
This is the pickup truck of theindustry.
It usually has the wheelhouseup front, giving it a wide and
(12:15):
long open back deck that you canput, deck cargo on.
There will be tanks all underthat deck that can bring out
liquid mud, can bring out fuel,can bring out water either water
for the rig or potable water.
So that is the main vessel andthere are in the US fleet.
Right now there are about 800OSVs working.
(12:38):
That's about a usual size.
Most of these vessels staypretty close to home, so they're
each built in a market.
There's about an equal numberin West Africa.
North Sea doesn't utilize asmany vessels.
Their vessels are biggerbecause of the sea state, but
(12:58):
they don't use as many.
So there's only about.
I'd say there's probablythree-fifths of what we have in
the Gulf they have in the NorthSea.
Middle East is the opposite.
They use a ton of vessels butthey're smaller.
So there's about one and a halftimes what they do in the
Middle East.
Southeast Asia is kind of thesame.
Brazil is probably about halfthe market as we are, and all of
(13:21):
those are kind of similar.
For that osv.
Now you also have you have liftboats, which are vessels that
will have 100 foot long legsthat they use to elevate
themselves out of the, out ofthe water, to provide a stable
work platform.
You have crew boats, which aresmaller osvs but made out of
aluminum and go fast, uh, to getcrew out and back.
(13:41):
That's why they're called crewboat.
And then you have anchor,anchor handler, tug supplies,
which does exactly like it saysit handles anchors and and and
tugs stuff and supplies stuff,um.
And then you have subseaconstruction vessels.
Uh, those are the vessels thatinstall what's on the seafloor.
So it's a they're.
(14:02):
Those are each like said,they're kind of purpose-built
but they can each be modified todo a different range of
activities.
Speaker 2 (14:10):
The US marine industry, the US maritime
industry that we're talkingabout.
Is it second to none, is itcomparable to other countries
around the world, or how do wecompare?
Speaker 3 (14:27):
Well, as a spokesman for the maritime, for the US
maritime industry, it's thenumber one.
It is.
You know, we invented thisindustry actually, and it's some
great histories.
There was a gentleman namedfrom, from Rhode Island, named
Luther Blount um, who heardabout offshore drilling.
(14:48):
This was back in the fiftiesand he had a ferry that he
thought would would adapt wellto it.
So he built one in Rhode Island, um put his station wagon on
the back, sailed it down toLouisiana.
Um sold four of them, sold thatone and three others to a
(15:09):
gentleman named Minor Jeremy andthen drove the station wagon
back up north.
And that's how offshore servicevessels were invented.
And you know, you think aboutjust doing that on spec.
Entrepreneurship there Can youimagine that right, I've got to
bring my own transport with me.
Speaker 1 (15:29):
Let me throw the station wagon in the back and.
Speaker 2 (15:32):
I love the analogy of the OSV being the pickup truck
of the industry, and that'sbasically what it is.
It's also a car trailer too, Iguess.
Speaker 3 (15:42):
Evidently, In that instance it is you got the right
?
ramps?
It sure can be, it is.
So you know that was where itinvented.
We also now, you know, now inthe subsea market we have a host
of really high test probably inthe subsea market we have the
newest fleet of vessels and wecan get into that about why that
(16:07):
is later.
You know, we've also pioneeredthe use of liftboats and we're
kind of one of there's agentleman over in Houma that
invented the liftboat.
Houma is a town in Louisianawhere our industry has a lot of
a lot of our members are basedin.
So it really is we.
We founded this industry and wecontinue to innovate in this
(16:28):
industry in really cool ways.
Speaker 1 (16:32):
Aaron, just for readers to note and I know we
discussed this when we werechatting earlier uh, there's a
great book called the rise ofthe Cajun Mariner, which you
know.
If you can find a copy of it,buy it and read it.
It's full of great stories, ofinspiration and entrepreneurship
and, frankly, reallyinteresting stories too.
(16:55):
you know all kinds of salaciousdetails about how Louisianans in
particular and the existingmariners of Louisiana, brought
their skills, technology andtechnique to really start deep
water development and the supplyvessels supporting deep water
development all over the rest ofthe world testaments of the
(17:29):
industry and really it is a trueAmerican success story of how
these people just figured outhow to convert something, how to
work something, and grew notonly a family business but grew
an entire industry.
Speaker 3 (17:42):
And you know, that's.
That's the sort of things we weas public policy experts or
public I don't want to say I'm apublic policy expert, but a
public policy participant thatwe should be leaning into and
creating, because they are somegreat success stories.
Where you can go from, you know, I think the first, there's
(18:02):
another family, the LittleBoards, who also take credit for
developing the first OSV.
They built that vessel with$100,000.
They had nine partners each putup $10,000, and then got
(18:23):
$10,000 from the bank to build avessel that was, I believe, 120
feet long.
You know, now we're talkingagain about vessels that are 300
feet long now cost $120 million, not $100,000, to build.
It's a great success story ofgrowing an industry, yeah for
sure.
Speaker 2 (18:50):
I'd like to pivot a little bit and start talking
about the wind industry and therelationship between the two.
Yeah, for sure, and repairs atdepth, or anything that you
haven't mentioned already.
Speaker 3 (19:04):
Well one.
You know when I think aboutespecially from the vessel side,
I don't split offshore windfrom oil and gas.
They are the same to me.
And you have vessels that goback and forth will actually go
back and forth without anymodification.
You have other vessels thatwill go back and forth without
any modification.
You have other vessels thatwill go back and forth with the
(19:28):
installation of a piece ofequipment called a walk-to-work
gangway.
These vessels will slide upnext to a wind turbine or a
monopile and will transfer techsover to that wind turbine and
they'll do so through a gangwaythat is motion articulated, so
(19:51):
it provides a stable workingplatform, and those will be
installed on a vessel or takenoff of a vessel in a few days'
time and that's all that will benecessary to transition a
vessel from oil and gas tooffshore wind.
Other times there won't be anymodifications.
You know, if you're puttingarmoring mats over a cable, it's
(20:12):
the same as putting armoringmats over a pipeline.
It's the same thing.
So a lot of this.
I don't split the twoindustries.
They are from a marineperspective.
They are really the sameindustry in most respects.
Now, of course there's somevery specialized vessels, but
that's the 10% on either side.
The healthy part of that bellcurve, the vessels are the same
(20:39):
a great point.
Speaker 2 (20:42):
I do want to talk about how the technology is very
in a lot of instances, is verymuch the same, and the synergy
between what we call is theoffshore oil and gas industry
and the wind industry is great.
But it's the service industrythat you're talking about is
(21:03):
also critical, and you mentionedHOMA.
That's a great example, not interms of service industry, but
HOMA is where the platforms, orthe foundations, if you will,
for the first offshore wind farmoff of Rhode Island of all
places were built.
They were built in HOMA andbarged up around to Rhode Island
(21:25):
, and it's a great example ofwhere the offshore industry in
oil and gas strengthens theability of the US economy to
support offshore wind as well.
So let's talk a little bit moreabout the relationship between
offshore wind and the maritimeindustry.
What do you see as theimmediate future and the
(21:48):
longer-term future for it?
Speaker 3 (21:51):
You know what we have now is you really have that
electricity supply is certainlygrowing faster and is actually
leading our, our energy needsmuch more than than oil or
natural gas is we really have aelectricitydriven economy in
(22:15):
many ways and know that requireselectricity and more and more
that is being developed from,you know, renewable sources, be
(22:42):
it on land or be it on water.
So for that reason you know weneed electricity demand just as
much, if not more, as we needliquid fuel demand.
And so I think, for that reason, I think we will see a growth
of an offshore wind industry.
And when you have really seen,you know that the technology on
(23:07):
the turbines themselves and thegenerators themselves and then
on the grid, you know they arejust getting more and more
efficient.
And I think for that reason youcontinue to see a development
of an offshore wind industryalongside and again, I don't
reinforce that with the conceptthat it's not just electricity
(23:38):
or liquid fuels.
Speaker 2 (23:40):
Virtually all demand for energy is outstripping the
existing supplies on all fronts,and it's not something that can
be kind of an either or let'sdo this or let's do that.
We're going to have to developall strategy, all possibilities,
and that's going to put demandson all kinds of phases as well
(24:02):
as, of course, marine serviceactivities.
Speaker 1 (24:07):
And Aaron I would just jump in and I want to make
sure too that I understand ifthey're in your organization but
all of the other criticalinfrastructure that we need,
both for kind of offshore energygeneration but also
telecommunications movement ofpower.
You know there's a lot ofcabling vessels that do a lot of
(24:27):
different kinds of cables,including telecommunications,
and I think one of the thingsthat we've seen are the
opportunities to runtransmission cables, potentially
offshore, between major loadcenters in the United States and
generation and load.
Those all have the opportunityto be quite active here in the
(24:48):
near future too, because we needto solve this challenge of
energy demand solve thischallenge of energy demand.
Speaker 3 (25:01):
So you know, we have really the offshore market.
Is the subsea market?
To me?
Yeah, and that's what happens,you know, when I'm on the Hill
to give these members ofCongress and congressional
staffers some perspective I talkabout, you know, if you put a
modern floating oil and gasplatform above the cap, you will
have that field that willextend out past Dulles Airport
(25:25):
and past on the other side, pastBWI Airport, you know,
extending all the way throughBaltimore, north of Baltimore,
and that will be one oil and gasplatform.
All of that has to be connectedvia pipelines and you don't
think about this also has to beconnected not only via pipelines
but via cables, because all itwon't just be one.
(25:46):
You know one place in northBaltimore connected to the
capital.
It will be a dozen wells upthere, all of which have to be
connected and all of which haveto be powered.
So you have to lay umbilicalsall the way out there along with
that pipeline.
Then you have to have thecompressors, you have to have,
of course, the wellheads.
All of that has to be installedand you're talking about
(26:08):
something that's in, you know,10,000 feet of water, and that
is where, you know, kind of.
We have seen in the unitedstates since about 2010, a just
a massive build in the subseaconstruction market, where these
vessels have been developed.
That, now, you know, startedwith modification again.
(26:30):
Our industry is always great atrepurposing a vessel.
They were first first putting,you know, 50-ton cranes on it.
Now you have vessels that have250-ton cranes, and these cranes
are amazing.
They will, you know, if youthink about it, you're trying to
install something in a veryprecise location, that's, you
(26:50):
know, let's say, 8,000 footbelow the sea.
Again, well, seas go up anddown, and so that crane has to
pay that line out and then pickit up so that, as the vessel
goes up and down, that equipmentit's trying to install doesn't
also go up and down, and sothese cranes do that.
(27:12):
When the merchandise getspicked up off the deck of the
vessel, if you think about it,it picks up that vessel is going
to rock back and forth.
Well, these cranes will haveautomatic anti-healing
technology, so they willautomatically sense that
something's been picked up andwill transfer ballast to keep
that vessel stable.
It is some amazing technologyand it doesn't only, like you
(27:34):
said, doesn't only have energytechnology, but it also has the
how the.
You know if you remember theChinese spy balloon that was
shot down a few years ago.
Speaker 1 (27:45):
Yeah, two years ago.
Speaker 3 (27:46):
It was.
The wreckage was found by foundin retrieve by one of my member
companies, because my membercompanies have made themselves
into subsea experts.
Yeah, you know, that's the sortof technology Taken another way
.
A few years ago, there was oneof our fighter jets slid off an
aircraft carrier on the otherside of the globe and it was
(28:08):
retrieved by a Chinese subseaconstruction vessel.
That's not good.
We shouldn't have China evertouching our fighter jets.
I don't want that.
And so by building up thisdomestic offshore energy fleet,
we also are building ournational security.
Speaker 1 (28:25):
And skill sets to do this all effectively around the
world.
Not only are these reallyamazing operations, but so much
of the technology is also beingused to do them safely to people
, to assets, to the environment.
I sat in that space in the oiland gas business and the
(28:48):
technology to make people safe,like walk to work, is really
high tech.
Imagine balancing between twodifferent positions on a rolling
sea.
But it's done because it's moreconvenient and it's safer for
people.
That mindset really runsthrough the energy business and
is very strong in the offshoreenergy business, because that's,
(29:09):
frankly, the worst thing tohappen if you were to hurt
someone or the environment right.
Speaker 3 (29:14):
Yes, I have a mentor that always talks about you know
that you can, and I'll say hisname because he deserves to be
recognized.
Suman Mugasetti is one of thebest safety minds in the entire
world in my mind, and he willtalk about that.
You can talk about all sorts ofdifferent risk profiles
offshore, but it really comesdown to four levels.
(29:38):
If you have something elevatedin the air, that's a risk.
If you have something on a deck, that's a little bit less of a
risk, but that's your baseline.
If you have something in thewater column, that's more than
on the deck, more than in theair.
But if you have something belowthe seafloor and by that he
(30:01):
means hydrocarbons that's yourtop risk.
And really, if you put thosefour risk buckets, everything
falls into one of those four andthat's where you need to spend
your time.
And so those walk-to-worksystems.
That falls into that firstin-the-air risk profile, and so
(30:24):
you really have to take care ofthat.
And so those systems well,first, offshore vessels use
what's called dynamicpositioning, and dynamic
positioning is to dumb it way,way down, is a very complex
autopilot.
What it does is it will takereferences from satellites and
then we'll take references fromlocal references, by bouncing a
(30:45):
microwave or a laser off ofsomething nearby, or the
seafloor or something that's inthe water column like a ROV, and
then we'll combine thatinformation with wind sensors.
We'll combine that informationand we'll put that into an
algorithm and then assume alsowhat the current that's
affecting that vessel is.
(31:05):
We'll wrap that all up and givethat information to the vessels
thrusters to so that vesselwill follow a predetermined
track.
We'll follow something, willfollow like a pipeline, all
automatically, or will holdposition next to a windmill and
in fact this technology is soadvanced that the ends of those
(31:29):
gangways, those ends of thosewalk-to-work gangways, are
providing data back to thatdynamic positioning system, so
that this system is actuallyit's learning the ocean system
and knows that as the vesselgoes up and down, it knows how
to adjust so that gangway staysperfectly level and safe.
It is a really cool technologythat it's not only a cool
(31:53):
technology but these operatorsthat operate it are really.
They are, you know, those arethe jobs we should be
incentivizing.
Speaker 2 (32:01):
And I think we are going to see a lot more in terms
of technological innovation inthe days to come.
You've touched on offshoresecurity and, with regard to
technology, some of the offshoresecurity issues and, as a
result, defense applicationsthis is real Big phrase in the
(32:23):
news of course these days isdominance.
So my question is with thekeeping up with the
technological developments andkeeping the market and keeping
the industry developing, is themarine industry in a position to
stay dominant to meet thechallenges that we're looking at
over the course of the nextcouple of decades?
Speaker 3 (32:45):
Where I look the most right now is cable security.
You know, we saw around theturn of the year there was a
cable in Europe that was cut bya Chinese vessel, took out a
large set of telecommunicationassets.
Actually, just at the end oflast month it was announced that
(33:09):
China has a new cable cuttingdevice that they can put on
vessels.
Cable cutting device that theycan put on vessels uh, this
thing can work in up to 13 000feet of water.
You know 13 000.
Think about, like, if you're ona plane and you take off, um,
and then there's the ding thatsays that you can start to use
your laptops or whatever that's,when you're 10 000 feet above
(33:31):
the, above the ground.
So think about that, that's 10000 feet.
Look down, look how smalleverything is on the ground.
Then now you're talking about13 000 feet below the sea.
This thing can cut cables atthat depth.
Now, and you know cables arearmored.
They are steel armored.
So this thing is cutting with adiamond tip blade that is
(33:55):
spinning at, I believe, 14 or1600 RPM.
We need to ensure that we and Imean we, as the United States
has to have the capability tolay another cable or repair that
cable that is cut.
You know, because you know whatwe've seen.
(34:15):
And you know, because you knowwhat we've seen, and you know,
ian, you started this programtalking about the economic
turmoil and you know, overnightthere was another set of tariffs
raised by China.
We need to have the domesticcapabilities within our maritime
space to respond to that andyou know, in that aspect we are
lacking.
We really are lacking and weneed to have some improvements.
(34:40):
And Washington needs to givethe US maritime industry the
conditions that we can competeand can build to that market.
Speaker 1 (34:52):
And Aaron, it seems like it's a great opportunity
for the defense sector, whichhas some of the capabilities
that we're talking about, forsure, and the commercial sector
to really combine on ways thatthe commercial sector can be
value add when needed, whencalled upon.
So there is the right kind ofsubsurface tooling, subsurface
(35:13):
detection equipment,intervention equipment available
.
You know, what we need is theability to deploy this quickly
with any vessel of opportunity,of a certain parameter right,
and a certain security clearance.
That's what's going to makethis effective, because the
whole oceans of the world arenow this geopolitical stage.
You didn't mention it, but butI know, you know everyone is
(35:36):
also familiar with the attackson the nordstrom pipelines as
well too, so you know that thisis clearly going on.
And to say that, uh, you know avessel was dragging anchor for
five or six miles and didn'trealize they were dragging
answer seems incredulous, right,right.
Speaker 3 (35:53):
Yes.
Speaker 2 (35:54):
Well, this pretty effectively identifies needs,
problems and opportunities, ifyou will, but what's holding us
back?
What does Washington need to doin order to help us meet the
demands that we're facing forthese various situations?
Speaker 3 (36:24):
When I go up to DC, I have, in a lot of respects, a
very simple ask.
Everyone goes up asking formoney, the maritime industry.
We're not asking for money onthis aspect.
We'll take some of your issuegiven.
We don't need money in thisrespect.
What we need is for we need thelaw to be enforced as written.
You know everyone, everyone hasheard about the Jones Act.
(36:45):
But you know, looking, reallythe Jones Act is is is unique in
that it has a preamble to itthat states its purpose.
You don't see this a lot in thefederal code and it says that
we have to have a US merchantmarine that carries a
significant portion of commerceand is ready to act in times of
(37:08):
conflict.
That's what we're talking aboutright now.
But and then you have to lookat what, what the Jones Act
covers.
The Jones Act covers whenmerchandise is transported from
one point in the United Statesto another point in the United
States.
But what has happened since,really, the late 70s is, you
(37:30):
know, bureaucrats within and no,I'm not, i'm'm not using that
with any tone in my voice there.
Jim, I know you have spentyears in federal service.
Speaker 1 (37:40):
I spent, again, I spent 10 years working on
Capitol Hill.
We all have bureaucratic ways,but we're not all bureaucrats.
Speaker 3 (37:48):
sometimes Exactly, exactly so.
But we have allowed.
You know, that's the statute,that's the law.
If you are transportingsomething from one point in the
United States to another pointin the United States, you need a
US-built, us-crewed, us-ownedvessel.
That's the law.
Laws are made by electedofficials, but what we've had
(38:11):
since 78 is a situation whereyou have lawyers within the
Customs and Border ProtectionAgency that have said well, I
don't think this law applies tothis situation, and they will
give someone the permission touse a foreign flag vessel to
move merchandise between onepoint and another point in the
United States, and they will doso in a private letter.
(38:34):
It's just a letter that isissued to one person and it's
supposed to be for that singulartransaction.
But after Al Gore invented theinternet, they put these letters
up online so you could see them.
Well, what you had was you hadsomeone that would come in and
say, well, I see this letter andI'm doing something.
(38:54):
That's sort of the same.
So since you approve that, canyou approve this?
And we've moved one degree, onedegree, one degree, one degree
off to the point where, inpipeway, in cableway, we don't
have US vessels, we only haveforeign vessels that have a
monopoly over these markets andhave pushed out the US from
(39:18):
being able to build.
We can certainly build, youknow, these are not like I said.
We have built complex vessels.
We built subsea constructionvessels.
We have.
We can build anything we want,but we have to be able to have
the certainty to make moneydoing so.
And look, it's not even just mymembers knowing the law, the
(39:38):
banks know the law just as wellas we do.
And if you were to go into abank right now and say, hey,
give me some money, I want tobuild a cable-a vessel, I'm
going to say no, customs andborder protection rulings
prevent you from doing so,prevent you from competing with
foreign vessels, so no, we'renot going to lend you money to
(40:01):
build that vessel.
Speaker 1 (40:02):
Aaron, I do want to ask a question, because
sometimes we propose to do stuffoffshore where there is limited
availability of the vesselswith the capabilities to do that
.
And I think of one veryspecific example that I was
involved in which required avery heavy hook height lift of a
certain facility that we didn'thave a domestic vessel that was
capable of doing that lift.
So to have an opportunity to doderogations to the Jones Act,
(40:26):
you know, in a formal letter fora particular activity may be
required sometimes, but I thinkwhat we want to get to is the
place where we start to buildmore and more capabilities in
our domestic fleet so that wecan do those.
So where do we find thisbalance between needs of today
and opportunities for tomorrow?
Speaker 3 (40:50):
Certainly so you know .
Again I go back to well, whyare those vessels not available
in the US?
And for a segment of those, asmall, very small segment, like
the vessels, you know, some ofthe vessels, you're talking
about a drill ship, a modu, evenreally the heaviest of heavy
lift vessels we'll.
(41:18):
You know, look, I'm, I'm, mrjones, act, I'm, I'm, everything
is us.
But even those vessels, it'svery hard, almost impossible, to
make a, a business case forthat doesn't involve some sort
of pixie dust or something likethat, or massive
government-backed pixie dust.
Um, you know.
So those, let's set those aside.
But that is five percent of themarket.
You know, maybe 10 percent ofthe market.
(41:39):
On the other 90 percent, Ithink we look at the question
again of why is there not thosevessels in the US fleet?
And to me that usually comesdown to because you have foreign
actors that are acting in USsovereign territory but playing
by a different set of rules.
And if you make everyone playby the same set of rules, then
(42:03):
you'll have US that can build tothose markets just like
everyone else does.
Speaker 2 (42:11):
Does this tie in with the American Offshore Workers
Fairness Act and can you tell usa little bit about what that is
and how that's playing out?
Speaker 3 (42:21):
Yes, it does.
So if we go back when offshoreenergy was first starting to be,
you know, really getting goingin the late 70s Congress, the uh
, what's called the outercontinental shelf lands act, or
oxla I've heard um and yes.
And oxla says this theseresources belong to the american
(42:47):
public.
You know, you get an offshorelease.
You don't get an offshoreownership.
You are leasing this propertyfrom the United States.
Therefore the United States,the citizens thereof, should
have the first crack, the rightof first refusal of employment
in the exploitation of theseresources.
(43:07):
And so Oxlis says if you areworking offshore, you should be
an American citizen or apermanent resident, right.
But in the late 70s it was alsounderstood that there was
development and the idea wasagain to pick on Norway.
(43:31):
A Norwegian vessel with aNorwegian crew could come into
US waters.
So a US vessel witha US crewcould go into Norwegian waters.
(43:55):
But when the law wasimplemented, coast Guard
apparently didn't get that memoand what they did was they
bifurcated the crew nationalityand the vessel nationality.
So now you have a Norwegianflagged vessel that has a crew
that comes from Estonia, ukraine, the Philippines, india.
And not only are those crewimported to US waters, waters,
(44:28):
their wages, their wage levelsare imported as well.
So we routinely find deckhandsworking on foreign vessels that
are making $30 a day in theUnited States.
You know, put this on land, putyou know, go to the West Texas
oil fields around Odessa.
You know, we would never allowa Ukrainian making $100 a day to
(44:49):
displace someone from the, youknow, the Permian Basin.
You know, put this in a.
And you know, in my home stateof Colorado, put this into a
Colorado wind farm.
We would never allow someonefrom the Philippines making $30
a day to displace a Coloradanworking in those assets.
(45:10):
But that's what we allow 13miles from our coast.
So the American Offshore WorkerFairness Act says if a foreign
vessel is working in US waters,its crew has to match its
nationality.
So if it's a Norwegian vessel,it's a Norwegian crew or has to
be an American crew, and thatway that vessel is playing on
(45:33):
the same playing field as ourvessels are.
And so then you have thatparity, and if you have that
parity, you have thatcompetition, that parity, and if
you have that parity, you havethat competition.
You can then compete and youwill see the US market grow,
just like it did in the subseamarket.
You know I've referenced a fewtimes that really the subsea
(45:56):
construction market started in2010 in the United States.
Well, that was because CBPchanged its enforcement of a
very minor set of its, of thoserulings it had given, which
allowed for US vessels to towork, and you know there a lot.
At the time, a lot of foreigncompanies said you know, we will
(46:18):
never build, the US will neverbuild subsea construction
markets.
Some companies you know maybesome people on this call used to
work for said that those samecompanies now put out press
releases when they hire a USsubsea construction vessel.
So we could do the same, anissue that is of direct
detriment to the.
American worker.
Speaker 2 (46:50):
And we definitely need to be looking at that.
Speaking of which, I have agreat interest in the
development of the workforce andin various arenas, not the
least of which, of course, isoffshore energy, but in talking
about marine services, how doesthat workforce get developed and
where does that?
Where does that come from, andare we going to be able to meet
(47:15):
the needs of the future?
Speaker 3 (47:17):
You know it is.
I love this question, jim,because I love, as much as I
love talking boat nerd stuff, Ilove talking about mariners
because these are the jobs thatwe should be providing in the
United States.
We should be incentivizing thiswork.
You know this is we take pridein our industry that we can take
(47:40):
someone out of high school inour industry, that we can take
someone out of high school andwithin six years, if they put in
the time and they do the rightthings and and they, they apply
themselves and take the rightcourses, they're going to be
making six figures in six years.
No, no college required.
Um, and you know right now, uh,what's called a, uh, an
able-bodied semen, uh, kind of,uh, not an entry level, but you
(48:02):
know you're one or two steps upfrom entry level.
Those guys are making $375 aday right now.
You know you get up and thenyou work your way from an AB up
to a captain.
Big boat captains right now aremaking $1,000 a day and you
know that is the jobs we shouldbe encouraging in this industry.
(48:25):
Again, no college required.
You can go to a maritime academy.
We have five of them in theunited states.
They are great work.
I work a lot with texas a&mmaritime academy.
It's one of the best schoolsyou'll ever see, one of the best
returns on an education dollar.
You know that, that you can.
When you go to a MaritimeAcademy.
You walk across the stage witha diploma and you walk across
(48:49):
the stage with a Coast Guardthird mates license, which lets
you start making a job that's,you know, above six figures in
the current marketplace.
That's a great thing, you know.
You think about these othercollege degrees that don't
provide necessarily thatimmediate pathway to financial
success.
So I love talking aboutmaritime stories.
Speaker 1 (49:12):
They're really great and it's really great.
So much upward mobility.
This is the American dream.
Right is in the maritime sectortoo, and you mentioned
certifications and from what Irecall of a lot of mariners,
they're always collectingcertifications.
They're getting skilled at alldifferent kinds of skills,
besides being awfully practicalwhenever we deal you know kind
(49:32):
of work with mariners ondifferent offshore projects or
challenges.
Tell me some interestingstories around that space,
because I'm sure you have them,aaron.
Speaker 3 (49:41):
Oh, yes, so the US maritime industry in most
respects uses what's called theHaas pipe system and the Haas
pipe this goes back to.
The Haas pipe is where theanchor chain goes through the
hull of the vessel and what usedto happen is a stowaway would
climb up the anchor chainthrough the Haas pipe, stow
(50:04):
themselves away on board, thenask for a job once the vessel
had left port and they basicallyhad to be given work and then
you could work your way up.
Uh, so that is an intrinsicallywhile it's a british term, it
is an intrinsically americanconcept where you start at the
bottom.
You start as an OS, an ordinaryseaman, and you work your way
(50:27):
up to the wheelhouse.
I have board members actuallythat started.
I have multiple board membersthat started as deckhands and
work their way up to thewheelhouse and then bought their
own company and are now owntheir own vessels.
So really, that is what you know.
That is the American dream.
(50:47):
You know, that is thatmotherhood and apple pie type
situation.
And you're right, every marinerI know carries around a three
ring binder with it and it's,you know.
Here's my advanced firefightingcertificate.
That's a week long course.
Here is my celestial navigation.
That's another week, longcourse.
(51:08):
You know, here is another.
Whatever course, none of thosealone make themselves a mariner,
but that binder collectivelymakes themselves a mariner, and
that's.
You know, that's an interestingand unique educational system
and it doesn't fit well into DCbuckets.
Speaker 2 (51:31):
Yeah, I see, I definitely see your point,
although I got to note the threering binder is getting rarer
and rarer Old school.
Speaker 1 (51:39):
Now it's got to be on your iPhone with digital
certificates.
Speaker 3 (51:41):
Yeah, yeah, but but that would require the Coast
Guard to modernize its licenses.
Here we go.
Speaker 1 (51:51):
Aaron, it's been great to have you join us today.
You know it's a really excitingindustry for me personally as
an oceanographer, and I hopeit's really interesting for our
audience too, because theservice industry is the one that
makes offshore energy go, nomatter which side of energy
(52:12):
you're on.
We need that service industryto thrive here in the United
States.
It's fantastic.
Thank you for all of the greatstories too.
You're reminding me a lot aboutmy time down on the bayous Jim.
Are there any key points thatyou'd like to capture from our
discussion?
Speaker 2 (52:27):
Yeah, the discussion was enlightening for me in that
it pointed to a continuing andexpanding demand for marine
services, and that's not onlybecause of the expanding market
but also because oftechnological developments.
And then pile on top of thatmaybe some legal corrections
(52:51):
that are in the best interest ofthe American worker.
So I think it's a criticalfactor for offshore, not only
for oil and gas, but also forthe wind industry as it moves
forward.
So I really appreciate thecomments you've made.
It's been very enlightening.
Speaker 1 (53:08):
We do this last drop in the oceans section, which is
just a moment or two to mentionanything else going on in your
world related to offshore energythat you'd like to mention but
that we're not going to diveinto in this episode.
You're our guest.
Would you like to take thefirst drop?
Speaker 3 (53:25):
Well, just first, thank you all for the
opportunity.
This has been a greatconversation.
I really appreciate y'all'stime and I hope the listeners
enjoy it as much as I, as muchas I have done giving it.
But for for my last drop, youknow what I would say is is
number one.
If you like these marinerstories, if you want to learn
(53:45):
more about them, check out ourYouTube channel, which you can
find at offshoremarineorg, orcheck out our Instagram handle,
which is Offshore America.
We have a bunch of the storieswhere we've highlighted some of
these men and women that areworking in these positions and
them telling their stories, andit's just some fascinating,
(54:08):
great stories of Americanworkers.
So we'd encourage everyone tocheck that out.
Also, if you happen to be in DCmid-May, may 13th every year
AMSA brings up about a thousandpounds of crawfish to Capitol
Hill and we have a crawfish boilon Capitol Hill for members of
Congress and congressional staff.
(54:29):
If you're interested withmaking connections with our
industry and our industry runson connections come on up.
We'd love to have you.
If you're going to be inVirginia Beach end of April for
conference there, you know weagain, our industry is built
upon connections, so we know howto throw a party.
So if you're in, if you're inVirginia beach end of April,
(54:51):
come on by the AMSA AMSA happyhour there.
It's always a good time.
Those are my last drops.
Speaker 2 (54:57):
My last drop is a little not not on on track with
this.
It's unrelated to thediscussion well, not totally
unrelated but I think there's avery interesting thing going on
in terms of news cycles rightnow.
We've had a lot of stuff goingon, of course, since January
20th, and the big item in thenews cycles right now is the
tariffs.
(55:17):
I think you're going to see ashift from that, because we've
been a few months in and we'regoing to start having the budget
discussions hit home and you'vestarted to hear of this.
But there's a lot of districtsthat are red districts and
they're going to start puttingpressure on the administration,
(55:38):
and I think this certainly is afactor in the offshore wind
industry, but in a bunch ofother industries as well, and I
think people should be lookingfor this shift and this
discussion that'll be coming upsoon.
Speaker 1 (55:53):
I've got two quick last drops and of course one of
the things is related to the newadministration.
Obviously, many of you areaware that a number of LNG
export permits and other LNGproject permits have moved
forward in the last couple ofweeks, and so we expect that
industry to start growing evenfurther in the United States.
(56:13):
There are a couple of keyprojects that are now
approaching final investmentdecision and we'll see them
likely move forward after thatdecision is taken.
And a shout out to all myfriends back at Shell for a
sub-sea tieback to Appomattox.
They just started productionfrom Dover, which is a sub-sea
tieback into there.
That is increasing productionand it's great to see the
(56:36):
announcement of First Oil.
So great job everybody at Shell.
Speaker 3 (56:40):
I did see that, Ian, and congrats to them as well.
Yes, I saw that this week andyou mentioned those LNG exports.
Hope to see more of them viaoffshore ports.
There was a young, enterprising, incredibly brilliant and
incredibly handsomecongressional staffer who
changed the Deepwater Ports Actby adding the words or export to
(57:04):
the statute and that allowedfor those offshore LNG export
terminals to go forward.
Speaker 1 (57:11):
Now, aaron, I won't ask you the snappers, but I have
a feeling I know who you'retalking about.
Well, well done, well placed.
Sir, aaron, great to have you.
Thank you for joining us.
Thanks for the great,thoughtful conversation, Aaron.
Great to have you.
Thank you for joining us.
Speaker 2 (57:25):
Thanks for the great thoughtful conversation.
I'd just like to extend thanks,of course, to all of the
listeners and would want to askagain, as we always do, if you
have any topics that you thinkwe ought to be covering.
Please let us know.
We'll be happy to do so and welook forward to our next episode
(57:46):
, which I don't believe we'vedetermined what the subject is
going to be.
Speaker 1 (57:48):
We're still trying to align schedules, jim.
I know Sorry.
Speaker 2 (57:51):
Listeners we'll get to it as fast as we can.
We'll get there, we'll leteverybody know and, Jim, you
know I was thinking too.
Speaker 1 (57:58):
Another good opportunity for us maybe is
product placement right, so wemight be able to generate some
more support from some reallykey product placement, like they
do in the movies.
And I was thinking right now,you know, speaking about energy
and offshore energy andinternational trade.
Maybe we could get asponsorship from Pepto-Bismol.
Pepto-bismol take away an acidstomach to survive the
(58:22):
challenges of the next 90 days.
What do you think, jim?
Sound good.
Speaker 2 (58:27):
I'm going to have to give that some thought, oh, okay
.
Speaker 1 (58:31):
Well said, well said, mr Politician Bureaucrat, great
to see you guys.
Thanks for coming.
Speaker 2 (58:36):
I was thinking you were going to go with Coca-Cola,
but you're much more inventive.
That's good too.
Speaker 1 (58:43):
That's good too.
That's good too.
All right, listeners, great totalk to you.
Talk to you soon on the nextOffshore Energy Podcast.
Thank you.
With all that's going on.
I wouldn't be surprised if youmissed it, but last week the
White House released anexecutive order restoring
America's maritime dominance toaddress national maritime
capacity and capability concerns.
It's no secret that USocean-going commercial and
military shipbuilding hasatrophied over the last 60 years
.
In 1960, the Americanocean-going fleet had almost
(00:34):
3,000 ships of over 1,000deadweight tons.
Today there are just a fewhundred.
China, in contrast, has over9,000 ships of the same size.
But what about the fleetsupporting offshore energy?
Jim and I got a chance to speakwith Aaron Smith of AMSA to
understand how we got here andhow we need to grow next on the
(00:54):
Offshore Energy Podcast.
I'm Jim Bennett and I have over40 years of experience
developing energy in the ocean.
I'm Ian Vopero and I've spentthe last 20 years developing
(01:16):
offshore energy projects aroundthe world, and this is the
Offshore Energy Podcast.
Speaker 2 (01:26):
Hey Jim, good morning , how are you?
Good morning, Ian, how are you?
You ready for another podcast?
Speaker 1 (01:30):
Jim, I noticed you stepped right past how you are,
so I'll just say it I'm veryconcerned about our current
trade policies, the financialmarkets and the impacts all of
this is having on everydaypeople like us.
But I'm ready to talk aboutsomething more fun, and what
better way than spending sometime with you and talking about
offshore energy?
Speaker 2 (01:51):
huh, I think you got a great point.
These market things willcertainly go up and down and
they're of great concern andthere are long-term impacts.
But when the ship's got to runand the boat got to sail and
that's what we're going to talkabout- I love it, jim.
Speaker 1 (02:08):
What a transition.
The ships got to run, the boatsgot to sail and today we are
really lucky to have Aaron Smithfrom AMSA joining us to talk
about ship sailing and offshorevessels supporting the maritime
industries, particularly aroundenergy.
Aaron, how are you?
Good morning, I'm doing great.
How are you?
Gents doing sailing an offshorevessel supporting the maritime
industries, particularly aroundenergy.
Speaker 3 (02:28):
Aaron, how are you Good?
Speaker 1 (02:30):
morning I'm doing great.
How are you gents doing?
Jim and I always banter aboutthe weather.
So I'm up here in New Englandit is still winter, even though
we are well into April, and,aaron, I noticed that you are a
little lighter dressed than I.
I hope the weather is nicewhere you are.
Speaker 3 (02:47):
I am.
I'm calling in from New Orleans.
Today it is beautiful, it's 71.
Just a great day.
Sun is shining, looking forwardto getting into festival season
.
We got French Quarter Feststarting this weekend, going
into Jazz Fest after that.
It's just really hard to getwork in at these times.
Speaker 1 (03:06):
Sounds really good.
Les et les bons temps roulés,monsieur.
All right, the good times roll.
Yeah, aaron, it's great to haveyou.
You know, will you do a littlepersonal introduction?
Share with our listeners whyyou're here, why you think, why
it's important to talk aboutoffshore energy and offshore
vessels in the United States?
Speaker 3 (03:26):
Well, certainly, certainly.
I'll start with the leastinteresting part about this and
talk about myself.
I spent 10 years on CapitolHill, working in mostly
transportation and energy policy.
During that time, I married agirl from New Orleans and for
anyone that's doing that, justknow you're, if you do that, you
will end up in new Orleans.
(03:48):
Regardless of where you find aspouse from new Orleans, you'll
end up in new Orleans, um, andso I realized that later and
then realized, well, shoot, Igot to figure out a way to get,
to get down there and to, to youknow, have make a living.
So, fortunately, I was workingfor a congressman that had
(04:09):
announced his retirement and atthe same time, there was a
freshman congressman named JeffLandry who had just won election
and he needed a transportationexpert, an energy expert, and
was able to link up with himexpert and energy expert, and
was able to link up with him andand just let me tell you that
that Jeff Landry is a great guyand he was so much fun to work
(04:30):
for.
So I spent ended up spending 10years on Capitol Hill.
The two I worked for Jeff.
I passed more bills andamendments than the other eight
combined, and most of that wasjust on his personality and his
just wanting to get stuff done.
So unfortunately Jeff lost inCongress.
(04:51):
But that opened up some otherdoors for him and he's now our
governor down here in Louisiana.
But it also introduced me tothe offshore service and supply
industry industry.
And so when Jeff lost, amsaactually was looking to start up
a dynamic positioning operatorcertification body, and so they
(05:11):
put me in charge of that andstarted that organization, grew
that organization and then a fewyears later they needed a
president and so came to me andI've been here about 10 years
now, so it's been great.
It's been great.
Speaker 1 (05:28):
It sounds great and for listeners OMSA, o-m-s-a
Aaron, it stands for.
Speaker 3 (05:35):
Yes, it stands for the Offshore Marine Service
Association.
We are the trade associationfor the segment of the US
maritime industry engaged inoffshore energy.
So our organization is 52 yearsold now, not surprisingly, like
most things in Louisiana,officially we are 52 years old.
Unofficially we date back tothe early 60s and we were
(06:02):
founded by the families thatfounded this industry.
These were the guys who tookwhen offshore energy developed.
It was kind of an afterthoughtof, well, how do we get
everything out there?
And so they took repurposedshrimp boats.
They took mothballed World WarII vessels and it wasn't until
the early 60s that we startedpurpose building vessels for
(06:23):
offshore construction.
And the families that startedthat the Labordes, the Cheramis,
the Ogerons, the Candys, theSchwest, the Terrios, the
Hilarios Don't worry, there willbe a spelling test at the end
of this they came together andfounded AMSA to support their
industry and support theirbeliefs, and so it's been great.
It's an amazing industry towork for.
(06:46):
It's so exciting, sointeresting.
For a boat nerd like me, I loveit.
Speaker 2 (06:53):
Well, that's great, aaron.
We really appreciate you beinghere.
I would like you to expand alittle bit, because our podcast
is, of course, ocean Energy, andit's certainly oil and gas, but
it's also wind.
We focus a lot on wind, andwhen we focus on wind, we have a
tendency to focus on it as anindependent kind of separate
(07:15):
industry, which it is not at all.
So if you could explain alittle bit more about what the
marine industry is, so that wecan get into a discussion of how
the two interact and how thingsare going to develop over time.
Speaker 3 (07:31):
Certainly so.
I think we're kind of.
You know, when people thinkabout maritime, they think about
ships that take things from onepoint to another.
You know international shipping.
Or they think about the bargesthey see on the Mississippi
River, the Ohio River, theIllinois Waterway.
They think about the bargesthey see on the Mississippi
River, the Ohio River, theIllinois Waterway.
They think about those.
We're different.
You have the brown water on therivers, the blue water in the
(07:53):
shipping.
We are offshore.
What we do is we takeeverything that is used,
consumed or is being builtoffshore or under the water and
we take that out there.
So you know, you think about.
You know, the way most peoplerecognize our industry is if you
(08:15):
think back to the pictures ofDeepwater Horizon and you think
about the rig that is burningand the vessels that are
spraying water on it.
Those are my member companiesand in fact the vessel that
rescued all of the workers whowere on the Deepwater Horizon
that night was the DamonBankston.
And, kind of interestingly,damon Bankston the man signed
(08:39):
OMSSA's Articles ofIncorporation.
So that is what we do.
We are the vessels that takeeverything offshore for, be it
wind or be it oil and gas, weare that link between America
and our offshore energy.
Speaker 2 (08:54):
Let me touch on that, because Macondo, of course, is
an unfortunate example, but itmakes your point about vessels
that service and are neededoffshore for all kinds of
activities, but it's not justemergency activities.
You're talking about a hugeindustry that constantly needs
(09:17):
service vessels, all kinds ofactivities that just to keep it
going in the normal sense, asopposed to the unusual situation
like we had with Macondo.
Speaker 3 (09:30):
It really is and it's .
We are out of sight, out ofmind.
You know we operate over thehorizon and usually the ports we
operate out of are not placespeople go.
You know, down here inLouisiana the main port is Port
Fouchon.
You know we now, with wind, weare in more populous areas and
(09:50):
so people are starting to seethe vessels that our member
companies run and so they'regetting some more information
about it, but it's still it'snot known.
You know you think about whathas to go into a project.
You know, if you think aboutyou're drilling a deep water
well in 8,000 feet of water well, that means you need 8,000 feet
(10:12):
of risers to connect the rig tothe ocean floor, and the oil
isn't at the ocean floor.
The oil is an equal distancedown below the seabed.
That means you need that muchdrill pipe and then you need
water, you need fuel to makethat work, you need people to
make that work.
Those people need food.
(10:32):
All of that has to be taken outand then constructed, and
that's what our members do withwhat are now purpose-built
vessels that are amazingtechnological masterpieces.
You know these vessels, at seastate, will hold position within
a meter and you're talkingabout a vessel that's 320 feet
(10:54):
long and can sit in eight-footseas without even moving.
It's really like I said, I'm aboat nerd and I love talking
about this stuff.
It's so interesting.
Speaker 1 (11:05):
Aaron, it's great to have you on.
I'm a boat nerd and I lovetalking about this stuff.
It's so interesting.
Aaron, it's great to have youon because I'm a boat nerd too,
as a former oceanographer aswell as an offshore energy
developer, so I love it.
It's very exciting.
You mentioned some of the.
Give us a little bit more aboutthe size and scale of the
industry in the US.
What do we have heredomestically?
How many vessels or the typesof vessels, that kind of thing.
Speaker 3 (11:33):
Yeah, so there are a bunch of different purpose-built
vessels that are used in ourindustry.
We also are constantly alwaysconverting and repurposing
modifying vessels to dodifferent things.
Modifying vessels to dodifferent things but our basic
platform is called an offshoreservice vessel or an offshore
supply vessel Same thing.
Internationally they're calledplatform supply vessels.
(11:54):
Look, I always say don't letboat guys name things, we're
just going to create a myriad ofdifferent and confusing names.
Just call them an OSV.
This is the pickup truck of theindustry.
It usually has the wheelhouseup front, giving it a wide and
(12:15):
long open back deck that you canput, deck cargo on.
There will be tanks all underthat deck that can bring out
liquid mud, can bring out fuel,can bring out water either water
for the rig or potable water.
So that is the main vessel andthere are in the US fleet.
Right now there are about 800OSVs working.
(12:38):
That's about a usual size.
Most of these vessels staypretty close to home, so they're
each built in a market.
There's about an equal numberin West Africa.
North Sea doesn't utilize asmany vessels.
Their vessels are biggerbecause of the sea state, but
(12:58):
they don't use as many.
So there's only about.
I'd say there's probablythree-fifths of what we have in
the Gulf they have in the NorthSea.
Middle East is the opposite.
They use a ton of vessels butthey're smaller.
So there's about one and a halftimes what they do in the
Middle East.
Southeast Asia is kind of thesame.
Brazil is probably about halfthe market as we are, and all of
(13:21):
those are kind of similar.
For that osv.
Now you also have you have liftboats, which are vessels that
will have 100 foot long legsthat they use to elevate
themselves out of the, out ofthe water, to provide a stable
work platform.
You have crew boats, which aresmaller osvs but made out of
aluminum and go fast, uh, to getcrew out and back.
(13:41):
That's why they're called crewboat.
And then you have anchor,anchor handler, tug supplies,
which does exactly like it saysit handles anchors and and and
tugs stuff and supplies stuff,um.
And then you have subseaconstruction vessels.
Uh, those are the vessels thatinstall what's on the seafloor.
So it's a they're.
(14:02):
Those are each like said,they're kind of purpose-built
but they can each be modified todo a different range of
activities.
Speaker 2 (14:10):
The US marine industry, the US maritime
industry that we're talkingabout.
Is it second to none, is itcomparable to other countries
around the world, or how do wecompare?
Speaker 3 (14:27):
Well, as a spokesman for the maritime, for the US
maritime industry, it's thenumber one.
It is.
You know, we invented thisindustry actually, and it's some
great histories.
There was a gentleman namedfrom, from Rhode Island, named
Luther Blount um, who heardabout offshore drilling.
(14:48):
This was back in the fiftiesand he had a ferry that he
thought would would adapt wellto it.
So he built one in Rhode Island, um put his station wagon on
the back, sailed it down toLouisiana.
Um sold four of them, sold thatone and three others to a
(15:09):
gentleman named Minor Jeremy andthen drove the station wagon
back up north.
And that's how offshore servicevessels were invented.
And you know, you think aboutjust doing that on spec.
Entrepreneurship there Can youimagine that right, I've got to
bring my own transport with me.
Speaker 1 (15:29):
Let me throw the station wagon in the back and.
Speaker 2 (15:32):
I love the analogy of the OSV being the pickup truck
of the industry, and that'sbasically what it is.
It's also a car trailer too, Iguess.
Speaker 3 (15:42):
Evidently, In that instance it is you got the right
?
ramps?
It sure can be, it is.
So you know that was where itinvented.
We also now, you know, now inthe subsea market we have a host
of really high test probably inthe subsea market we have the
newest fleet of vessels and wecan get into that about why that
(16:07):
is later.
You know, we've also pioneeredthe use of liftboats and we're
kind of one of there's agentleman over in Houma that
invented the liftboat.
Houma is a town in Louisianawhere our industry has a lot of
a lot of our members are basedin.
So it really is we.
We founded this industry and wecontinue to innovate in this
(16:28):
industry in really cool ways.
Speaker 1 (16:32):
Aaron, just for readers to note and I know we
discussed this when we werechatting earlier uh, there's a
great book called the rise ofthe Cajun Mariner, which you
know.
If you can find a copy of it,buy it and read it.
It's full of great stories, ofinspiration and entrepreneurship
and, frankly, reallyinteresting stories too.
(16:55):
you know all kinds of salaciousdetails about how Louisianans in
particular and the existingmariners of Louisiana, brought
their skills, technology andtechnique to really start deep
water development and the supplyvessels supporting deep water
development all over the rest ofthe world testaments of the
(17:29):
industry and really it is a trueAmerican success story of how
these people just figured outhow to convert something, how to
work something, and grew notonly a family business but grew
an entire industry.
Speaker 3 (17:42):
And you know, that's.
That's the sort of things we weas public policy experts or
public I don't want to say I'm apublic policy expert, but a
public policy participant thatwe should be leaning into and
creating, because they are somegreat success stories.
Where you can go from, you know, I think the first, there's
(18:02):
another family, the LittleBoards, who also take credit for
developing the first OSV.
They built that vessel with$100,000.
They had nine partners each putup $10,000, and then got
(18:23):
$10,000 from the bank to build avessel that was, I believe, 120
feet long.
You know, now we're talkingagain about vessels that are 300
feet long now cost $120 million, not $100,000, to build.
It's a great success story ofgrowing an industry, yeah for
sure.
Speaker 2 (18:50):
I'd like to pivot a little bit and start talking
about the wind industry and therelationship between the two.
Yeah, for sure, and repairs atdepth, or anything that you
haven't mentioned already.
Speaker 3 (19:04):
Well one.
You know when I think aboutespecially from the vessel side,
I don't split offshore windfrom oil and gas.
They are the same to me.
And you have vessels that goback and forth will actually go
back and forth without anymodification.
You have other vessels thatwill go back and forth without
any modification.
You have other vessels thatwill go back and forth with the
(19:28):
installation of a piece ofequipment called a walk-to-work
gangway.
These vessels will slide upnext to a wind turbine or a
monopile and will transfer techsover to that wind turbine and
they'll do so through a gangwaythat is motion articulated, so
(19:51):
it provides a stable workingplatform, and those will be
installed on a vessel or takenoff of a vessel in a few days'
time and that's all that will benecessary to transition a
vessel from oil and gas tooffshore wind.
Other times there won't be anymodifications.
You know, if you're puttingarmoring mats over a cable, it's
(20:12):
the same as putting armoringmats over a pipeline.
It's the same thing.
So a lot of this.
I don't split the twoindustries.
They are from a marineperspective.
They are really the sameindustry in most respects.
Now, of course there's somevery specialized vessels, but
that's the 10% on either side.
The healthy part of that bellcurve, the vessels are the same
(20:39):
a great point.
Speaker 2 (20:42):
I do want to talk about how the technology is very
in a lot of instances, is verymuch the same, and the synergy
between what we call is theoffshore oil and gas industry
and the wind industry is great.
But it's the service industrythat you're talking about is
(21:03):
also critical, and you mentionedHOMA.
That's a great example, not interms of service industry, but
HOMA is where the platforms, orthe foundations, if you will,
for the first offshore wind farmoff of Rhode Island of all
places were built.
They were built in HOMA andbarged up around to Rhode Island
(21:25):
, and it's a great example ofwhere the offshore industry in
oil and gas strengthens theability of the US economy to
support offshore wind as well.
So let's talk a little bit moreabout the relationship between
offshore wind and the maritimeindustry.
What do you see as theimmediate future and the
(21:48):
longer-term future for it?
Speaker 3 (21:51):
You know what we have now is you really have that
electricity supply is certainlygrowing faster and is actually
leading our, our energy needsmuch more than than oil or
natural gas is we really have aelectricitydriven economy in
(22:15):
many ways and know that requireselectricity and more and more
that is being developed from,you know, renewable sources, be
(22:42):
it on land or be it on water.
So for that reason you know weneed electricity demand just as
much, if not more, as we needliquid fuel demand.
And so I think, for that reason, I think we will see a growth
of an offshore wind industry.
And when you have really seen,you know that the technology on
(23:07):
the turbines themselves and thegenerators themselves and then
on the grid, you know they arejust getting more and more
efficient.
And I think for that reason youcontinue to see a development
of an offshore wind industryalongside and again, I don't
reinforce that with the conceptthat it's not just electricity
(23:38):
or liquid fuels.
Speaker 2 (23:40):
Virtually all demand for energy is outstripping the
existing supplies on all fronts,and it's not something that can
be kind of an either or let'sdo this or let's do that.
We're going to have to developall strategy, all possibilities,
and that's going to put demandson all kinds of phases as well
(24:02):
as, of course, marine serviceactivities.
Speaker 1 (24:07):
And Aaron I would just jump in and I want to make
sure too that I understand ifthey're in your organization but
all of the other criticalinfrastructure that we need,
both for kind of offshore energygeneration but also
telecommunications movement ofpower.
You know there's a lot ofcabling vessels that do a lot of
(24:27):
different kinds of cables,including telecommunications,
and I think one of the thingsthat we've seen are the
opportunities to runtransmission cables, potentially
offshore, between major loadcenters in the United States and
generation and load.
Those all have the opportunityto be quite active here in the
(24:48):
near future too, because we needto solve this challenge of
energy demand solve thischallenge of energy demand.
Speaker 3 (25:01):
So you know, we have really the offshore market.
Is the subsea market?
To me?
Yeah, and that's what happens,you know, when I'm on the Hill
to give these members ofCongress and congressional
staffers some perspective I talkabout, you know, if you put a
modern floating oil and gasplatform above the cap, you will
have that field that willextend out past Dulles Airport
(25:25):
and past on the other side, pastBWI Airport, you know,
extending all the way throughBaltimore, north of Baltimore,
and that will be one oil and gasplatform.
All of that has to be connectedvia pipelines and you don't
think about this also has to beconnected not only via pipelines
but via cables, because all itwon't just be one.
(25:46):
You know one place in northBaltimore connected to the
capital.
It will be a dozen wells upthere, all of which have to be
connected and all of which haveto be powered.
So you have to lay umbilicalsall the way out there along with
that pipeline.
Then you have to have thecompressors, you have to have,
of course, the wellheads.
All of that has to be installedand you're talking about
(26:08):
something that's in, you know,10,000 feet of water, and that
is where, you know, kind of.
We have seen in the unitedstates since about 2010, a just
a massive build in the subseaconstruction market, where these
vessels have been developed.
That, now, you know, startedwith modification again.
(26:30):
Our industry is always great atrepurposing a vessel.
They were first first putting,you know, 50-ton cranes on it.
Now you have vessels that have250-ton cranes, and these cranes
are amazing.
They will, you know, if youthink about it, you're trying to
install something in a veryprecise location, that's, you
(26:50):
know, let's say, 8,000 footbelow the sea.
Again, well, seas go up anddown, and so that crane has to
pay that line out and then pickit up so that, as the vessel
goes up and down, that equipmentit's trying to install doesn't
also go up and down, and sothese cranes do that.
(27:12):
When the merchandise getspicked up off the deck of the
vessel, if you think about it,it picks up that vessel is going
to rock back and forth.
Well, these cranes will haveautomatic anti-healing
technology, so they willautomatically sense that
something's been picked up andwill transfer ballast to keep
that vessel stable.
It is some amazing technologyand it doesn't only, like you
(27:34):
said, doesn't only have energytechnology, but it also has the
how the.
You know if you remember theChinese spy balloon that was
shot down a few years ago.
Speaker 1 (27:45):
Yeah, two years ago.
Speaker 3 (27:46):
It was.
The wreckage was found by foundin retrieve by one of my member
companies, because my membercompanies have made themselves
into subsea experts.
Yeah, you know, that's the sortof technology Taken another way
.
A few years ago, there was oneof our fighter jets slid off an
aircraft carrier on the otherside of the globe and it was
(28:08):
retrieved by a Chinese subseaconstruction vessel.
That's not good.
We shouldn't have China evertouching our fighter jets.
I don't want that.
And so by building up thisdomestic offshore energy fleet,
we also are building ournational security.
Speaker 1 (28:25):
And skill sets to do this all effectively around the
world.
Not only are these reallyamazing operations, but so much
of the technology is also beingused to do them safely to people
, to assets, to the environment.
I sat in that space in the oiland gas business and the
(28:48):
technology to make people safe,like walk to work, is really
high tech.
Imagine balancing between twodifferent positions on a rolling
sea.
But it's done because it's moreconvenient and it's safer for
people.
That mindset really runsthrough the energy business and
is very strong in the offshoreenergy business, because that's,
(29:09):
frankly, the worst thing tohappen if you were to hurt
someone or the environment right.
Speaker 3 (29:14):
Yes, I have a mentor that always talks about you know
that you can, and I'll say hisname because he deserves to be
recognized.
Suman Mugasetti is one of thebest safety minds in the entire
world in my mind, and he willtalk about that.
You can talk about all sorts ofdifferent risk profiles
offshore, but it really comesdown to four levels.
(29:38):
If you have something elevatedin the air, that's a risk.
If you have something on a deck, that's a little bit less of a
risk, but that's your baseline.
If you have something in thewater column, that's more than
on the deck, more than in theair.
But if you have something belowthe seafloor and by that he
(30:01):
means hydrocarbons that's yourtop risk.
And really, if you put thosefour risk buckets, everything
falls into one of those four andthat's where you need to spend
your time.
And so those walk-to-worksystems.
That falls into that firstin-the-air risk profile, and so
(30:24):
you really have to take care ofthat.
And so those systems well,first, offshore vessels use
what's called dynamicpositioning, and dynamic
positioning is to dumb it way,way down, is a very complex
autopilot.
What it does is it will takereferences from satellites and
then we'll take references fromlocal references, by bouncing a
(30:45):
microwave or a laser off ofsomething nearby, or the
seafloor or something that's inthe water column like a ROV, and
then we'll combine thatinformation with wind sensors.
We'll combine that informationand we'll put that into an
algorithm and then assume alsowhat the current that's
affecting that vessel is.
(31:05):
We'll wrap that all up and givethat information to the vessels
thrusters to so that vesselwill follow a predetermined
track.
We'll follow something, willfollow like a pipeline, all
automatically, or will holdposition next to a windmill and
in fact this technology is soadvanced that the ends of those
(31:29):
gangways, those ends of thosewalk-to-work gangways, are
providing data back to thatdynamic positioning system, so
that this system is actuallyit's learning the ocean system
and knows that as the vesselgoes up and down, it knows how
to adjust so that gangway staysperfectly level and safe.
It is a really cool technologythat it's not only a cool
(31:53):
technology but these operatorsthat operate it are really.
They are, you know, those arethe jobs we should be
incentivizing.
Speaker 2 (32:01):
And I think we are going to see a lot more in terms
of technological innovation inthe days to come.
You've touched on offshoresecurity and, with regard to
technology, some of the offshoresecurity issues and, as a
result, defense applicationsthis is real Big phrase in the
(32:23):
news of course these days isdominance.
So my question is with thekeeping up with the
technological developments andkeeping the market and keeping
the industry developing, is themarine industry in a position to
stay dominant to meet thechallenges that we're looking at
over the course of the nextcouple of decades?
Speaker 3 (32:45):
Where I look the most right now is cable security.
You know, we saw around theturn of the year there was a
cable in Europe that was cut bya Chinese vessel, took out a
large set of telecommunicationassets.
Actually, just at the end oflast month it was announced that
(33:09):
China has a new cable cuttingdevice that they can put on
vessels.
Cable cutting device that theycan put on vessels uh, this
thing can work in up to 13 000feet of water.
You know 13 000.
Think about, like, if you're ona plane and you take off, um,
and then there's the ding thatsays that you can start to use
your laptops or whatever that's,when you're 10 000 feet above
(33:31):
the, above the ground.
So think about that, that's 10000 feet.
Look down, look how smalleverything is on the ground.
Then now you're talking about13 000 feet below the sea.
This thing can cut cables atthat depth.
Now, and you know cables arearmored.
They are steel armored.
So this thing is cutting with adiamond tip blade that is
(33:55):
spinning at, I believe, 14 or1600 RPM.
We need to ensure that we and Imean we, as the United States
has to have the capability tolay another cable or repair that
cable that is cut.
You know, because you know whatwe've seen.
(34:15):
And you know, because you knowwhat we've seen, and you know,
ian, you started this programtalking about the economic
turmoil and you know, overnightthere was another set of tariffs
raised by China.
We need to have the domesticcapabilities within our maritime
space to respond to that andyou know, in that aspect we are
lacking.
We really are lacking and weneed to have some improvements.
(34:40):
And Washington needs to givethe US maritime industry the
conditions that we can competeand can build to that market.
Speaker 1 (34:52):
And Aaron, it seems like it's a great opportunity
for the defense sector, whichhas some of the capabilities
that we're talking about, forsure, and the commercial sector
to really combine on ways thatthe commercial sector can be
value add when needed, whencalled upon.
So there is the right kind ofsubsurface tooling, subsurface
(35:13):
detection equipment,intervention equipment available
.
You know, what we need is theability to deploy this quickly
with any vessel of opportunity,of a certain parameter right,
and a certain security clearance.
That's what's going to makethis effective, because the
whole oceans of the world arenow this geopolitical stage.
You didn't mention it, but butI know, you know everyone is
(35:36):
also familiar with the attackson the nordstrom pipelines as
well too, so you know that thisis clearly going on.
And to say that, uh, you know avessel was dragging anchor for
five or six miles and didn'trealize they were dragging
answer seems incredulous, right,right.
Speaker 3 (35:53):
Yes.
Speaker 2 (35:54):
Well, this pretty effectively identifies needs,
problems and opportunities, ifyou will, but what's holding us
back?
What does Washington need to doin order to help us meet the
demands that we're facing forthese various situations?
Speaker 3 (36:24):
When I go up to DC, I have, in a lot of respects, a
very simple ask.
Everyone goes up asking formoney, the maritime industry.
We're not asking for money onthis aspect.
We'll take some of your issuegiven.
We don't need money in thisrespect.
What we need is for we need thelaw to be enforced as written.
You know everyone, everyone hasheard about the Jones Act.
(36:45):
But you know, looking, reallythe Jones Act is is is unique in
that it has a preamble to itthat states its purpose.
You don't see this a lot in thefederal code and it says that
we have to have a US merchantmarine that carries a
significant portion of commerceand is ready to act in times of
(37:08):
conflict.
That's what we're talking aboutright now.
But and then you have to lookat what, what the Jones Act
covers.
The Jones Act covers whenmerchandise is transported from
one point in the United Statesto another point in the United
States.
But what has happened since,really, the late 70s is, you
(37:30):
know, bureaucrats within and no,I'm not, i'm'm not using that
with any tone in my voice there.
Jim, I know you have spentyears in federal service.
Speaker 1 (37:40):
I spent, again, I spent 10 years working on
Capitol Hill.
We all have bureaucratic ways,but we're not all bureaucrats.
Speaker 3 (37:48):
sometimes Exactly, exactly so.
But we have allowed.
You know, that's the statute,that's the law.
If you are transportingsomething from one point in the
United States to another pointin the United States, you need a
US-built, us-crewed, us-ownedvessel.
That's the law.
Laws are made by electedofficials, but what we've had
(38:11):
since 78 is a situation whereyou have lawyers within the
Customs and Border ProtectionAgency that have said well, I
don't think this law applies tothis situation, and they will
give someone the permission touse a foreign flag vessel to
move merchandise between onepoint and another point in the
United States, and they will doso in a private letter.
(38:34):
It's just a letter that isissued to one person and it's
supposed to be for that singulartransaction.
But after Al Gore invented theinternet, they put these letters
up online so you could see them.
Well, what you had was you hadsomeone that would come in and
say, well, I see this letter andI'm doing something.
(38:54):
That's sort of the same.
So since you approve that, canyou approve this?
And we've moved one degree, onedegree, one degree, one degree
off to the point where, inpipeway, in cableway, we don't
have US vessels, we only haveforeign vessels that have a
monopoly over these markets andhave pushed out the US from
(39:18):
being able to build.
We can certainly build, youknow, these are not like I said.
We have built complex vessels.
We built subsea constructionvessels.
We have.
We can build anything we want,but we have to be able to have
the certainty to make moneydoing so.
And look, it's not even just mymembers knowing the law, the
(39:38):
banks know the law just as wellas we do.
And if you were to go into abank right now and say, hey,
give me some money, I want tobuild a cable-a vessel, I'm
going to say no, customs andborder protection rulings
prevent you from doing so,prevent you from competing with
foreign vessels, so no, we'renot going to lend you money to
(40:01):
build that vessel.
Speaker 1 (40:02):
Aaron, I do want to ask a question, because
sometimes we propose to do stuffoffshore where there is limited
availability of the vesselswith the capabilities to do that
.
And I think of one veryspecific example that I was
involved in which required avery heavy hook height lift of a
certain facility that we didn'thave a domestic vessel that was
capable of doing that lift.
So to have an opportunity to doderogations to the Jones Act,
(40:26):
you know, in a formal letter fora particular activity may be
required sometimes, but I thinkwhat we want to get to is the
place where we start to buildmore and more capabilities in
our domestic fleet so that wecan do those.
So where do we find thisbalance between needs of today
and opportunities for tomorrow?
Speaker 3 (40:50):
Certainly so you know .
Again I go back to well, whyare those vessels not available
in the US?
And for a segment of those, asmall, very small segment, like
the vessels, you know, some ofthe vessels, you're talking
about a drill ship, a modu, evenreally the heaviest of heavy
lift vessels we'll.
(41:18):
You know, look, I'm, I'm, mrjones, act, I'm, I'm, everything
is us.
But even those vessels, it'svery hard, almost impossible, to
make a, a business case forthat doesn't involve some sort
of pixie dust or something likethat, or massive
government-backed pixie dust.
Um, you know.
So those, let's set those aside.
But that is five percent of themarket.
You know, maybe 10 percent ofthe market.
(41:39):
On the other 90 percent, Ithink we look at the question
again of why is there not thosevessels in the US fleet?
And to me that usually comesdown to because you have foreign
actors that are acting in USsovereign territory but playing
by a different set of rules.
And if you make everyone playby the same set of rules, then
(42:03):
you'll have US that can build tothose markets just like
everyone else does.
Speaker 2 (42:11):
Does this tie in with the American Offshore Workers
Fairness Act and can you tell usa little bit about what that is
and how that's playing out?
Speaker 3 (42:21):
Yes, it does.
So if we go back when offshoreenergy was first starting to be,
you know, really getting goingin the late 70s Congress, the uh
, what's called the outercontinental shelf lands act, or
oxla I've heard um and yes.
And oxla says this theseresources belong to the american
(42:47):
public.
You know, you get an offshorelease.
You don't get an offshoreownership.
You are leasing this propertyfrom the United States.
Therefore the United States,the citizens thereof, should
have the first crack, the rightof first refusal of employment
in the exploitation of theseresources.
(43:07):
And so Oxlis says if you areworking offshore, you should be
an American citizen or apermanent resident, right.
But in the late 70s it was alsounderstood that there was
development and the idea wasagain to pick on Norway.
(43:31):
A Norwegian vessel with aNorwegian crew could come into
US waters.
So a US vessel witha US crewcould go into Norwegian waters.
(43:55):
But when the law wasimplemented, coast Guard
apparently didn't get that memoand what they did was they
bifurcated the crew nationalityand the vessel nationality.
So now you have a Norwegianflagged vessel that has a crew
that comes from Estonia, ukraine, the Philippines, india.
And not only are those crewimported to US waters, waters,
(44:28):
their wages, their wage levelsare imported as well.
So we routinely find deckhandsworking on foreign vessels that
are making $30 a day in theUnited States.
You know, put this on land, putyou know, go to the West Texas
oil fields around Odessa.
You know, we would never allowa Ukrainian making $100 a day to
(44:49):
displace someone from the, youknow, the Permian Basin.
You know, put this in a.
And you know, in my home stateof Colorado, put this into a
Colorado wind farm.
We would never allow someonefrom the Philippines making $30
a day to displace a Coloradanworking in those assets.
(45:10):
But that's what we allow 13miles from our coast.
So the American Offshore WorkerFairness Act says if a foreign
vessel is working in US waters,its crew has to match its
nationality.
So if it's a Norwegian vessel,it's a Norwegian crew or has to
be an American crew, and thatway that vessel is playing on
(45:33):
the same playing field as ourvessels are.
And so then you have thatparity, and if you have that
parity, you have thatcompetition, that parity, and if
you have that parity, you havethat competition.
You can then compete and youwill see the US market grow,
just like it did in the subseamarket.
You know I've referenced a fewtimes that really the subsea
(45:56):
construction market started in2010 in the United States.
Well, that was because CBPchanged its enforcement of a
very minor set of its, of thoserulings it had given, which
allowed for US vessels to towork, and you know there a lot.
At the time, a lot of foreigncompanies said you know, we will
(46:18):
never build, the US will neverbuild subsea construction
markets.
Some companies you know maybesome people on this call used to
work for said that those samecompanies now put out press
releases when they hire a USsubsea construction vessel.
So we could do the same, anissue that is of direct
detriment to the.
American worker.
Speaker 2 (46:50):
And we definitely need to be looking at that.
Speaking of which, I have agreat interest in the
development of the workforce andin various arenas, not the
least of which, of course, isoffshore energy, but in talking
about marine services, how doesthat workforce get developed and
where does that?
Where does that come from, andare we going to be able to meet
(47:15):
the needs of the future?
Speaker 3 (47:17):
You know it is.
I love this question, jim,because I love, as much as I
love talking boat nerd stuff, Ilove talking about mariners
because these are the jobs thatwe should be providing in the
United States.
We should be incentivizing thiswork.
You know this is we take pridein our industry that we can take
(47:40):
someone out of high school inour industry, that we can take
someone out of high school andwithin six years, if they put in
the time and they do the rightthings and and they, they apply
themselves and take the rightcourses, they're going to be
making six figures in six years.
No, no college required.
Um, and you know right now, uh,what's called a, uh, an
able-bodied semen, uh, kind of,uh, not an entry level, but you
(48:02):
know you're one or two steps upfrom entry level.
Those guys are making $375 aday right now.
You know you get up and thenyou work your way from an AB up
to a captain.
Big boat captains right now aremaking $1,000 a day and you
know that is the jobs we shouldbe encouraging in this industry.
(48:25):
Again, no college required.
You can go to a maritime academy.
We have five of them in theunited states.
They are great work.
I work a lot with texas a&mmaritime academy.
It's one of the best schoolsyou'll ever see, one of the best
returns on an education dollar.
You know that, that you can.
When you go to a MaritimeAcademy.
You walk across the stage witha diploma and you walk across
(48:49):
the stage with a Coast Guardthird mates license, which lets
you start making a job that's,you know, above six figures in
the current marketplace.
That's a great thing, you know.
You think about these othercollege degrees that don't
provide necessarily thatimmediate pathway to financial
success.
So I love talking aboutmaritime stories.
Speaker 1 (49:12):
They're really great and it's really great.
So much upward mobility.
This is the American dream.
Right is in the maritime sectortoo, and you mentioned
certifications and from what Irecall of a lot of mariners,
they're always collectingcertifications.
They're getting skilled at alldifferent kinds of skills,
besides being awfully practicalwhenever we deal you know kind
(49:32):
of work with mariners ondifferent offshore projects or
challenges.
Tell me some interestingstories around that space,
because I'm sure you have them,aaron.
Speaker 3 (49:41):
Oh, yes, so the US maritime industry in most
respects uses what's called theHaas pipe system and the Haas
pipe this goes back to.
The Haas pipe is where theanchor chain goes through the
hull of the vessel and what usedto happen is a stowaway would
climb up the anchor chainthrough the Haas pipe, stow
(50:04):
themselves away on board, thenask for a job once the vessel
had left port and they basicallyhad to be given work and then
you could work your way up.
Uh, so that is an intrinsicallywhile it's a british term, it
is an intrinsically americanconcept where you start at the
bottom.
You start as an OS, an ordinaryseaman, and you work your way
(50:27):
up to the wheelhouse.
I have board members actuallythat started.
I have multiple board membersthat started as deckhands and
work their way up to thewheelhouse and then bought their
own company and are now owntheir own vessels.
So really, that is what you know.
That is the American dream.
(50:47):
You know, that is thatmotherhood and apple pie type
situation.
And you're right, every marinerI know carries around a three
ring binder with it and it's,you know.
Here's my advanced firefightingcertificate.
That's a week long course.
Here is my celestial navigation.
That's another week, longcourse.
(51:08):
You know, here is another.
Whatever course, none of thosealone make themselves a mariner,
but that binder collectivelymakes themselves a mariner, and
that's.
You know, that's an interestingand unique educational system
and it doesn't fit well into DCbuckets.
Speaker 2 (51:31):
Yeah, I see, I definitely see your point,
although I got to note the threering binder is getting rarer
and rarer Old school.
Speaker 1 (51:39):
Now it's got to be on your iPhone with digital
certificates.
Speaker 3 (51:41):
Yeah, yeah, but but that would require the Coast
Guard to modernize its licenses.
Here we go.
Speaker 1 (51:51):
Aaron, it's been great to have you join us today.
You know it's a really excitingindustry for me personally as
an oceanographer, and I hopeit's really interesting for our
audience too, because theservice industry is the one that
makes offshore energy go, nomatter which side of energy
(52:12):
you're on.
We need that service industryto thrive here in the United
States.
It's fantastic.
Thank you for all of the greatstories too.
You're reminding me a lot aboutmy time down on the bayous Jim.
Are there any key points thatyou'd like to capture from our
discussion?
Speaker 2 (52:27):
Yeah, the discussion was enlightening for me in that
it pointed to a continuing andexpanding demand for marine
services, and that's not onlybecause of the expanding market
but also because oftechnological developments.
And then pile on top of thatmaybe some legal corrections
(52:51):
that are in the best interest ofthe American worker.
So I think it's a criticalfactor for offshore, not only
for oil and gas, but also forthe wind industry as it moves
forward.
So I really appreciate thecomments you've made.
It's been very enlightening.
Speaker 1 (53:08):
We do this last drop in the oceans section, which is
just a moment or two to mentionanything else going on in your
world related to offshore energythat you'd like to mention but
that we're not going to diveinto in this episode.
You're our guest.
Would you like to take thefirst drop?
Speaker 3 (53:25):
Well, just first, thank you all for the
opportunity.
This has been a greatconversation.
I really appreciate y'all'stime and I hope the listeners
enjoy it as much as I, as muchas I have done giving it.
But for for my last drop, youknow what I would say is is
number one.
If you like these marinerstories, if you want to learn
(53:45):
more about them, check out ourYouTube channel, which you can
find at offshoremarineorg, orcheck out our Instagram handle,
which is Offshore America.
We have a bunch of the storieswhere we've highlighted some of
these men and women that areworking in these positions and
them telling their stories, andit's just some fascinating,
(54:08):
great stories of Americanworkers.
So we'd encourage everyone tocheck that out.
Also, if you happen to be in DCmid-May, may 13th every year
AMSA brings up about a thousandpounds of crawfish to Capitol
Hill and we have a crawfish boilon Capitol Hill for members of
Congress and congressional staff.
(54:29):
If you're interested withmaking connections with our
industry and our industry runson connections come on up.
We'd love to have you.
If you're going to be inVirginia Beach end of April for
conference there, you know weagain, our industry is built
upon connections, so we know howto throw a party.
So if you're in, if you're inVirginia beach end of April,
(54:51):
come on by the AMSA AMSA happyhour there.
It's always a good time.
Those are my last drops.
Speaker 2 (54:57):
My last drop is a little not not on on track with
this.
It's unrelated to thediscussion well, not totally
unrelated but I think there's avery interesting thing going on
in terms of news cycles rightnow.
We've had a lot of stuff goingon, of course, since January
20th, and the big item in thenews cycles right now is the
tariffs.
(55:17):
I think you're going to see ashift from that, because we've
been a few months in and we'regoing to start having the budget
discussions hit home and you'vestarted to hear of this.
But there's a lot of districtsthat are red districts and
they're going to start puttingpressure on the administration,
(55:38):
and I think this certainly is afactor in the offshore wind
industry, but in a bunch ofother industries as well, and I
think people should be lookingfor this shift and this
discussion that'll be coming upsoon.
Speaker 1 (55:53):
I've got two quick last drops and of course one of
the things is related to the newadministration.
Obviously, many of you areaware that a number of LNG
export permits and other LNGproject permits have moved
forward in the last couple ofweeks, and so we expect that
industry to start growing evenfurther in the United States.
(56:13):
There are a couple of keyprojects that are now
approaching final investmentdecision and we'll see them
likely move forward after thatdecision is taken.
And a shout out to all myfriends back at Shell for a
sub-sea tieback to Appomattox.
They just started productionfrom Dover, which is a sub-sea
tieback into there.
That is increasing productionand it's great to see the
(56:36):
announcement of First Oil.
So great job everybody at Shell.
Speaker 3 (56:40):
I did see that, Ian, and congrats to them as well.
Yes, I saw that this week andyou mentioned those LNG exports.
Hope to see more of them viaoffshore ports.
There was a young, enterprising, incredibly brilliant and
incredibly handsomecongressional staffer who
changed the Deepwater Ports Actby adding the words or export to
(57:04):
the statute and that allowedfor those offshore LNG export
terminals to go forward.
Speaker 1 (57:11):
Now, aaron, I won't ask you the snappers, but I have
a feeling I know who you'retalking about.
Well, well done, well placed.
Sir, aaron, great to have you.
Thank you for joining us.
Thanks for the great,thoughtful conversation, Aaron.
Great to have you.
Thank you for joining us.
Speaker 2 (57:25):
Thanks for the great thoughtful conversation.
I'd just like to extend thanks,of course, to all of the
listeners and would want to askagain, as we always do, if you
have any topics that you thinkwe ought to be covering.
Please let us know.
We'll be happy to do so and welook forward to our next episode
(57:46):
, which I don't believe we'vedetermined what the subject is
going to be.
Speaker 1 (57:48):
We're still trying to align schedules, jim.
I know Sorry.
Speaker 2 (57:51):
Listeners we'll get to it as fast as we can.
We'll get there, we'll leteverybody know and, Jim, you
know I was thinking too.
Speaker 1 (57:58):
Another good opportunity for us maybe is
product placement right, so wemight be able to generate some
more support from some reallykey product placement, like they
do in the movies.
And I was thinking right now,you know, speaking about energy
and offshore energy andinternational trade.
Maybe we could get asponsorship from Pepto-Bismol.
Pepto-bismol take away an acidstomach to survive the
(58:22):
challenges of the next 90 days.
What do you think, jim?
Sound good.
Speaker 2 (58:27):
I'm going to have to give that some thought, oh, okay
.
Speaker 1 (58:31):
Well said, well said, mr Politician Bureaucrat, great
to see you guys.
Thanks for coming.
Speaker 2 (58:36):
I was thinking you were going to go with Coca-Cola,
but you're much more inventive.
That's good too.
Speaker 1 (58:43):
That's good too.
That's good too.
All right, listeners, great totalk to you.
Talk to you soon on the nextOffshore Energy Podcast.
Thank you.
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