OSV Market Outlook....bummer

Greeting All,
Just read through this:

[B]OSV markets present a mixed bag for vessel owners[/B]

		 				 					By Richard Sanchez  [I]  6/15/2009 10:20:50 PM GMT[/I]

			[IMG]http://www.energycurrent.com/public/pictures/s-osv-03.jpg[/IMG] 				HOUSTON, TEXAS: The U.S. Gulf offshore support vessel (OSV) market continues to feel the effects of the downturn in shelf activity, while in the North Sea, vessel owners are enjoying a rise in rates, for now.

[B]U.S. Gulf of Mexico[/B]
U.S. Gulf OSV fleet utilization continues to fall: There is simply less work for platform supply vessels in the region. As a result, day rates in the region have fallen even further. Rates for some platform supply vessels (PSVs) under 200 feet (61 m) in length have dropped below US$4,999, confirming talk in the market heard in May.

Vessel owners are sullen, bemoaning the depressed rates and lack of work. One PSV owner working on the shelf said he was looking at “nothing. It’s quiet, too quiet.”

A similar sentiment was expressed by a manager of one of the larger fleets with some deepwater coverage. “The market is changing from a month ago. There is not a lot of demand. There is more capacity. The rates are impacted and we’re seeing more lulls between jobs.”

Another vessel owner suggested, “It’s going to be tough with the hurricane season just starting.”

Owners have no choice but to stack vessels. Hornbeck Offshore Services has cold-stacked approximately five conventional PSVs, although fleet utilization for the company’s new generation vessels remains above 90 percent. Trico Marine has opted to warm stack some PSVs, but is keeping a minimum crew on board.

The typically tight U.S. Gulf anchor-handling towing supply vessel (AHTS) market has also experienced some slackening in demand.

In response, Seacor Marine has cold stacked 18 older offshore support vessels, including the 8,400 bhp AHTS Seacor Reliant and Seacor Rigorous. However, Seacor Davis, a new 265-foot (81-m), 10,750 bhp AHTS, is now working in the area. The vessel, which was delivered in May, went to work briefly for Eni, and is now working for ATP Oil and Gas for about a month. Seacor Davis is one of Seacor’s new generation diesel electric DP2 anchor handlers, which has a liquid mud capacity of 7,852 barrels and ROV support capability.

[B]North Sea[/B]
Term and spot demand in the North Sea market has improved this month compared to May. The region had been experiencing basement-level day rates last month, but an increase in demand and a net loss of seven vessels to other markets seems to have translated into a bump in average and spot day rates. PSVs less than 4,000 dwt suffered a decline in average day rates.

Day rates for large AHTSs undertaking rig moves have picked up significantly, however, with newbuilds on the way and vessels scheduled to move into the area from other markets, the bump in rates may be short-lived.

Demand for offshore support vessels in Northwest Europe is expected to trend slightly down over the next 12 months, but no dramatic changes in the market seem likely. According to ODS-Petrodata’s [I]The OMEGA Report - North Sea Supply Vessels[/I], the biggest concern facing OSV owners is the large number of newbuild vessels in the pipeline for delivery over the next 12 to 18 months. The increase in supply will be difficult for a stagnant market to absorb.

[B]Central & South America[/B]
The Central and South American OSV markets remain relatively strong, with 251 vessels on term charters and another 26 in the spot market, according to ODS-Petrodata’s MarineBase online market intelligence service. U.S. vessel owners are looking south for opportunities for some of their underutilized vessels. However, competition is stiff, there are barriers to entry and OSV demand is not likely to grow rapidly in the current economic climate.

Things might look bleak, but it’s no were near what was going on in the 80’s from what I have heard.

Oil closed at in the low $60’s a barrel for June delivery, that helped stabilize things. With it looking like were going to have a July delivery of $75+ a barrel we’ll start to see things pick up again. It just takes a few months for things to work out.

just talked w/ a “companyman” consultant type I know…his comment was “last year I couldn’t get a relief and right now there is nothing for me to do; there are projects out there but the companies are in a holding pattern”…they are telling him to not to expect it to turn arround till next year…suggest you all hang on to whatever you got.

myself am trying to locate a position on a tug and doesn’t seem to be much out there either.

Hornbeck is doing well in the deepwater markets and has contracts already signed for it’s nine new generation osv’s! The jobs are coming back, we must be patient.