Page 22: of Maritime Reporter Magazine (October 2014)

22 Maritime Reporter & Engineering News • OCTOBER 2014

GOVERNMENT UPDATE

O ffshore supply vessels (OSVs), also known as plat- form supply vessels (PSVs), have been a distinct ves- sel type since 1956, when the MV Ebb

Tide was placed into service in the Gulf of Mexico. Ebb Tide was designed by

Alden J. “Doc” Laborde to meet the growing demand for vessels to service the increasing number of offshore oil drilling rigs in those waters. Previously, this new industry had been served, al- beit inadequately, by existing vessels, particularly surplus amphibious assault barges. Ebb Tide was designed with the pilot house at the bow and with an open deck from there aft to the stern. It was an immediate hit with customers and formed the foundation of the Tidewater

Company, now a leader in the industry.

The problem, if it can be considered from that perspective, was that the exist- ing statutory and regulatory scheme had not envisioned such a vessel. Although relatively small, it could carry a signifi - cant amount of cargo, including bulk liq- uid cargo. In a different confi guration, it could carry a signifi cant number of per- sons in addition to crew. The U.S. Coast

Guard was at a loss regarding how these vessels should be regulated. Likewise, the classifi cation societies, including the

American Bureau of Shipping (ABS), had no succinct rules for their classifi ca- tion. The Coast Guard and ABS did the same thing that Mr. Laborde had done – they improvised, initially developing one-off, ad hoc approaches intended to allow the innovative vessels to continue working while ensuring that the crews, cargoes, and vessels were safe.

The Coast Guard soon developed the practice of inspecting OSVs as cargo and miscellaneous vessels if of more than 15 gross tons and of less than 500 gross tons and carrying freight for hire (referred to as “supply boats”). Those OSVs of less than 100 gross tons and carrying more than six passengers for hire were referred to as “crew boats” and were inspected as small passenger vessels.

On October 6, 1980, Public Law 96- 378 was signed into law. It established the offshore supply vessel as a separate category of vessel subject to inspection by the Coast Guard. It also redefi ned the term “passenger” as regards OSVs to exclude a person employed in some phase of exploration, exploitation, or production of offshore mineral or ener- gy resources served by the vessel. This provision exempted OSV crew boats from coverage under the small passen- ger vessel regulations. The statute also established minimum manning levels for OSVs and provided for licensing and certifi cation of offi cers and crew. Final- ly, the new law made all OSVs subject to inspection, including those operating under bareboat charters.

The process of drafting and promul- gating regulations implementing the new statute turned out to be excruciat- ingly long. In the meantime, though, the

Coast Guard issued guidance to its fi eld personnel and to the industry in the form of a Navigation and Vessel Inspection

Circular (NVIC). As its name implies,

NVIC 8-81 “Initial and Subsequent In- spection of Uncertifi ed Existing Off- shore Supply Vessels under Public Law 96-378” provided guidance for applying standards to OSVs (and later, liftboats) that were already in operation when the statute was enacted. This guidance was updated and expanded by means of

NVIC 8-91, entitled “Initial and Subse- quent Inspection of Existing, Uncertifi ed

Offshore Supply Vessels, Including Lift- boats”, which superseded NVIC 8-81.

After two Advance Notices of Pro- posed Rulemaking (ANPRMs) in 1983 and 1987 and one Notice of Proposed

Rulemaking (NPRM) in 1989, the In- terim Rule for Offshore Supply Vessels was fi nally promulgated on November 16, 1995. For the fi rst time, it provided a complete set of regulations (new Sub- chapter L of Title 46, Code of Federal

Regulations) applicable to new OSVs, including liftboats. For purposes of the regulation, a new OSV was any such vessel that was certifi cated on or after

March 15, 1996. OSVs that were certifi - cated prior to that date were considered existing OSVs. Existing OSVs could either comply in their entirety with the new regulations or comply with the pre- vious regulations and policy, including the NVIC. The OSV fi nal rule, largely adopting the interim rule, was promul- gated on September 19, 1997. Various amendments have been promulgated over the years.

It gradually became apparent, though, that the designers of the OSV program had imposed unforeseen constraints.

Few envisioned in the early days of the industry that OSVs would exceed the 500 gross ton upper limit provided for in the 1980 statute. The oil and gas industry, though, kept building larger and larger rigs, drilling further and further offshore, and operating in harsher conditions than the Gulf of Mexico. The support ves- sels, particularly the OSVs, had to be- come larger and more robust in order to keep up with the demand. This was not a problem in other countries, where there was no artifi cial limit on OSV size, but it put an unexpected constraint on the OSV industry in the United States.

Included within the Coast Guard Au- thorization Act of 2010 (Pub.L. 111-281) was section 617. This section eliminated the upper tonnage limit of 500 GRT or 6,000 GT ITC for OSVs and set certain manning and construction requirements for larger OSVs. The section also pro- vided for the direct promulgation by the

Coast Guard of regulations implement- ing the statutory amendments. The impe- tus for these amendments was the drastic change in the industry, particularly inter- nationally. While the U.S. offshore in- dustry was bound by the 500 GRT limit, foreign competitors were building and operating larger OSVs, capable of carry- ing more freight further offshore. The

United States, where the OSV had been born, was forced to play catch-up. The 2010 statutory amendment was intended to put the U.S. OSV industry back on a level playing fi eld.

As specifi cally allowed by the 2010 statute, the US Coast Guard skipped over the usual notice of proposed rule- making (NPRM). The agency issued, instead, an interim rule (IR) on August 18, 2014 entitled “Offshore Supply Ves- sels of at Least 6,000 GT ITC”. While its provisions entered into effect upon publication, the Coast Guard requested comments from the public on potential improvements. The IR is intended to be consistent with international standards for the design, engineering, construc- tion, operations and manning, inspec- tions, and certifi cation of OSVs. In one particular aspect, the new regulations may exceed international standards. The regulations require that tanks on these larger OSVs intended for carriage of cargo oil, including drilling fl uids con- taining oil, comply with double hull re- quirements developed for tank vessels.

Similar protection is required for fuel oil tank protection on these larger OSVs.

These steps have been taken so as to re- duce the risk of pollution in the event of a casualty, a measure that has proven effective on tank vessels and has since been expanded to many cargo vessels.

The ball is now back in the court of the

United States offshore supply vessel in- dustry – the naval architects, shipyards, owners, operators and crew members – to demonstrate that they can truly com- pete in this dynamic global sector. After all, the industry was created in America.

It is only appropriate that the United

States dominate it again.

O? shore Supply Vessels

BY DENNIS BRYANT

After all, the industry was created in America ... it is only appropriate that the United States dominate it again.

The Author

Dennis L. Bryant is with Maritime Regu- latory Consulting, and a regular contribu- tor to Maritime Reporter & Engineering

News as well as online at MaritimePro- fessional.com. t: 1 352 692 5493 e: [email protected]

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