Page 18: of Offshore Engineer Magazine (Nov/Dec 2023)

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OFFSHORE WIND

THE $1 BILLION

OFFSHORE WIND PRIZE

FOR U.S. SHIPYARDS

Te growing CTV and SOV market represents a long-term demand for at least 60 to more than 130 vessels

By Philip Lewis, Research Director of Intelatus Global Partners he U.S. offshore wind market presents a $1 bil- European specifcation CTVs for around $5.5-6 million lion long-term opportunity to builders of crew per vessel, with build cycles of 8-10 months and capacity transfer vessels (CTV) and service operation to produce 10 vessels a year.

vessels (SOV) that will support both wind farm We note similar pricing trends in the SOV segment as seen

T construction and long-term operations and maintenance. in the CTV segment. We have reported previously the price

Unlike many of the construction vessels to be deployed on difference in U.S. built SOVs compared to those deployed in

U.S. wind projects, CTVs and SOVs must be Jones Act Europe and the three Tier 1 vessels currently being built in the compliant, meaning they will be built, owned and oper- U.S. are reported to cost between $97 and 162 million each. ated by U.S. companies and personnel. SOVs contracted for the European market at a similar time to

However, although seen as somewhat commoditized the three Jones Act vessels cost between $67-75 million.

vessels, a clear understanding of the commercial technical Where the right conditions exist, such as a developer or drivers in each of the segments is required. turbine OEM operating a large number of turbines in a

These are the fndings of a new analysis of the global relatively close geographic proximity, Tier 1 SOVs will be

CTV market produced by Intelatus Global Partners. used for turbine commissioning and O&M support. Tier 2

The CTV and SOV opportunity walk-to-walk vessels, mainly redeployed from the Gulf of

By the end of 2024, the U.S. Tier 1 (purpose built) and Mexico’s oil & gas sector, will also be used for turbine com-

Tier 2 CTV (conversions) feet will have grown to 23 ves- missioning and some maintenance work from time to time. sels, with owners holding options to build at least a further Vessels falling into this category include the Paul Candies 12 vessels. and one of the Hornbeck HOSSOV 300E MPSVs.

Long-term, the market has a potential O&M related de- There remains potential for additional Tier 1 vessels, mand for 60-130 CTVs with additional CTVs required for with at least three vessels currently identifed by develop- logistics during the offshore construction of wind farms. ers, for an estimated CAPEX of $450-500 million.

MARAD Title XI loan guarantee documentation indicates To confrm the theme of comparatively high costs for lo-

U.S. CTV pricing of around $12 million per vessel. As a cally built vessels, in its Q2-23 fnancial reporting, Dominion result, the net long-term capital requirement for new CTV Energy has reported that the construction of the U.S.-built construction is $440-1,140 million. Construction cycle wind turbine installation vessel (WTIV) Charybdis had cost time is at least 12 months per vessel (and as much as 15-20 $367 million as of June 30, 2023, and is forecast to rise to months) excluding design and approvals. Most yards in- around $625 million by time of delivery at the end of 2024 volved in the building of CTVs for the U.S. market appear or early 2025. To put this in context, WTIVs contracted in to be able to produce between one and four CTVs annually. Asian yards with similar specifcations in the same time peri-

By comparison, leading Southeast Asian yards will sell od as Charybdis, cost around $325 million. The delayed de- 18 OFFSHORE ENGINEER OEDIGITAL.COM