Seatrade Maritime is part of the Informa Markets Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Loosening OSV age requirements in a tight market

Informa Markets The offshore FID panel at SMLME 2023
High demand and limited supply of Offshore Support Vessels (OSVs) in the Middle East is leading a rethink of the usual 15-year age limit for contracted vessels.

At the Seatrade Maritime Middle East 2023 Offshore Marine and Workboats Forum, experts discussed the role of age limits in maintaining safety in offshore operations, and the likelihood of easing those limits.

“It's an inherited standard that has been followed for many, many years,” said Capt. Mohamed Al Ali, Senior Vice President, Offshore Logistics, ADNOC Logistics & Services. “I don't think there's a scientific methodology that was followed to define this age, maybe it was based on risk assessment."

Ali said that with limited newbuilding in the sector and high costs for new vessels, companies are focused on what’s available and loosening age requirements is the easiest way for operators to get the resources they need.

“We need to look at this age limit again, and it’s something that is being studied within ADNOC. It’s something we can review and change.”

Douglas R. Korth- Former Senior Director- Marine Operations Offshore ME, McDermott saw changes from other big players in the market.

“What we're seeing with Aramco in particular is they have relaxed back off on age restrictions already on say, the Safaniya increment bids that are coming out, because they recognise there is a scarcity [of vessels]. If they maintain their existing age restrictions, it's going to have a huge potential to delay their projects or their development,” said Korth.

Matthew Tremblay, Vice President of Global Offshore Markets, ABS said age is just an indicator.

“Age is just a number, right? From our perspective, as a class society, it comes down to how well these assets are maintained. It's really about specification and capability. Whether you want to draw a line at 15 years or 20 years, does that asset meet the needs of the work?” said Tremblay.

Martin Helweg, CEO, P&O Maritime Logistics, said he has seen tenders from Saudi Aramco come out allowing vessels up to 20 years of age and exceptions made in other circumstances.

“I think it's fairly simple right now. The dynamics are in favour of the owner of the operator and the oil companies, our customers, are scrambling for capacity. As they scramble they will go down the chain saying if we can't get a 15-year old vessel, can we get 16 ?17? 18? 19? 20?” said Helweg.

Dr. Anil Sharma, Founder & CEO, Global Marketing Systems (GMS) added: “As you said, age is just a number. The youngest ship I recycled was five years old; it was a terrible vessel. And the oldest vessel I recycled was almost 50 years old, a US Jones Act vessel, it was an excellent ship.”

Panellists said they had seen more interest in assurance of vessel quality through classification societies and the like to mitigate any additional risk from using older assets and ensure those assets are fit for purpose.

With a current low orderbook and tight yard space, the tight capacity does not look set to resolve itself soon.

“It's going to take a lot of newbuilding to move that average age of the fleet,” said Tremblay.