Skip to content
dls insights

Today it’s Cash Flow. Tomorrow Oil Flow?

SIR, YOUR CARD IS MAXED OUT

On an adjusted dollar value basis oil hasn’t been this cheap in over thirty years. Fuel is the biggest single expense for vessel operators so this should be a blessing. Even the shock of IMO 2020 low sulfur fuel regulations have been greatly softened with the difference between high sulfur and low sulfur fuels dropping to a small gap. Only in today’s economic climate it is not the blessing it could be.

It doesn’t matter what bunker fuel costs if you can’t buy it.

With the battered world economy maritime industry, be it operators of the largest container ships, an ocean going tug, or a local fisherman, cash flow is needed to buy the fuel to run the ship. But petroleum is a cash product. Cash on delivery – from the refinery to a transporter or from a fueling site/barge to an end user. You don’t get the fuel unless you have laid down the cash.

For some end users it is actual cash, but for most national or international users it is through bank transfers which may depend on credit ratings dependent on a company’s financial health or lack of health.

At a time when lenders may already have to worry about their asset-based loans, they may also have to worry about whether the customer can run the vessel if it gets work.

INTO THE CRYSTAL BALL

The American Bureau of Shipping (ABS) has produced a study “LOW CARBON SHIPPING OUTLOOK” which opines on shipping’s compliance with the IMO guidelines for 2050. Of particular interest might be the graphs showing the make-up of the world fleet into the future, the type fuel they will be using and the commodities they will be carrying.

The ABS study, and several others I’ve read, believe that LNG will be the fuel of the future, but just of the near future. Say 20 years, the lifetime of vessels being designed and built now. The problem is that LNG, when looked at in the overall picture, including its production, is not as clean as other products. Hydrogen is the longer term future and larger hydrogen fuel cells are being designed and built. The ABS report I noted above also shows ammonia being the future along with hydrogen. I was originally surprised by ammonia being a growth fuel as I think of it as being very dangerous to humans and requiring special handling. Fine to power an ammonia tanker which already has ammonia on board and can use the boil off as fuel for its diesel engine.

But some deeper diving into the world of chemistry, a scary world for this brain, I learned that ammonia can be a cheap and easy way to produce more hydrogen for fuel cells. But the production of ammonia produces a large output of CO2. There are now a number of trial plants around the world that are using solar or wind power to produce ammonia then hydrogen through water electrolysis. I will be trying to learn more about that as I do believe hydrogen fuel cells will be a major source of power for many industries and modes of transportation in the future.

One benefit of having so many experienced surveyors in the field is having constant feedback on what is going on onboard the vessels, at the docks, and in the shipbuilding and repair yards. This daily interface with the maritime front lines is of great immediate value in understanding the markets, which is useful in DLS’s appraisal work and for helping underwriters and owners on repair costs. At the same time, we continue research to try to understand what we and our customers may be dealing with in the future. Future articles will try to look at what the industry might look like in the next decade as new technology takes hold, and what the new technology might mean to vessel designs.

Norman Laskay

nlaskay@DLSmarine.com

Follow Us for more like this:

Additional articles
Green Ships DLS Marine Survey & Appraisal

Do Green Ships Have a Nuclear Future?

The amount of money being put into meeting the 2050 air cleanliness goals of the Paris Accords and the IMO is staggering. Every week we read more news items and long reports on studies and research and experiments on new technology.

Read More »
Off Shore Wind Farm DLS Marine Appraisal and Valuation

So, What About Offshore Wind Farms?

We are headlong into the new world of wind power. Not so new if you consider that Hero of Alexandria (20 AD-70 AD) invented a windmill that pumped a bellows attached to a pipe organ. (And he invented the first vending machine – it dispensed holy water). The first windmill to provide electricity was built in 1887 by a Scottish inventor, James Blyth, to power his home.

Read More »
DLS Marine - US Join The Green Wave

Will the U.S. Join the Green Wave?

This month I look at the new administration’s first proposed bill that affects the oceans and shipping, an intro to a new cargo carriage idea that is not so new, and how diesel exhaust scrubbers are currently doing in the marketplace.

Read More »

Get A Quote

The Fastest Way To Get Your Project Started

DLS Marine Valuation Logo
Matt McDaniel DLS Marine Survey and Appraisal

Matt McDaniel

Hull & Machinery Surveyor

Areas of Expertise:

  • Hull and Machinery
  • Damage Assessment and Repairs
  • Condition
  • Inspections
  • Project Management

Memberships / Professional Certification:

  • NAMS-CMS

Background:

Matt began marine surveying in 2014 and has experience with damage causation, reviewing transit plans, new construction, cargo transfers, salvage operations, on/off charters, and general condition surveys. He joined the Hull & Machinery department at DLS in 2019.

mmcdaniel@dlsmarine.com
Jessie Page DLS Marine Survey and Appraisal

Jessie Page

Hull & Machinery Surveyor

Areas of Expertise:

  • Hull and Machinery
  • Diesel Technician
  • Marine Repair and Fabrication
  • Engine Causation Analysis
  • Equipment Damage
  • Vessel Conditions and Safety

Professional Certifications:

  • NAMS-CMS

Certified Specialist in Caterpillar diesel engines to include:

  • Small Engine Fuel Systems
  • Medium Engine Fuel Systems
  • Engine Diagnostics
  • Electronic Sensors and Control Logics
  • Electric and Electronic Troubleshooting
  • 3500 A/B/C Diesel Engine Master Mechanic I MUI/MEUI

Background:

Jessie joined DLS in 2021 with extensive experience in the marine industry. Jessie began his career as a shipfitter, machinist, and propulsion machinery installer at a shipyard. He then spent ten years as a diesel technician doing everything from routine mechanical repairs to complete engine overhauls and dynamometer testing. Jessie specializes in engine failure analysis and recognizing improper maintenance and installation. He is able to make recommendations regarding failure causation and potential imminent failures. Jessie transitioned to marine surveying in 2016 and is now a part of the DLS Hull & Machinery department.

jpage@dlsmarine.com

Ave P. Boudreaux

Marine Surveyor

Areas of Expertise:

  • Hull and Machinery
  • Project Management Supervisor (QC) – overseen numerous construction and delivery schedules for vessels
  • Extensive knowledge of U.S. Coast Guard and ABS rules and regulations for vessel construction and repair

Education:

  • Rolls-Royce Z-Drive Failure Analysis Seminar
  • Flex-Core and Aluminum Welding Course
  • Extensive training in engine, gear, and shaft alignment
  • Extensive training in vessel repair and new construction

Memberships / Professional Certification:

  • NAMS-CMS

Background:

Mr. Boudreaux has 15 years experience with offshore supply vessels, crewboats, and anchor handling tugs. During this time, he served 8 years in vessel repair and new construction, 3 years in vessel operation and logistics, and 4 years as a vessel port captain.

Mr. Boudreaux served over 3 years as a marine surveyor performing numerous types of surveys in the marine industry prior to joining DLS.

 aboudreaux@dlsmarine.com

Norm Laskay - DLS Marine Valuation

Norman F. Laskay

Of Counsel

Mr. Laskay joined Stickney, Dufour & Associates, Inc. in 1988 as a partner. He is now of Counsel. He became a Marine Surveyor in 1974, having gained prior experience in steamship agency, bulk cargo handling and vessel operations. He has been involved in many aspects of marine surveying including hull, machinery and cargo, both inland and ocean. Since becoming an Accredited Senior Appraiser of commercial marine equipment, he has been active with the American Society of Appraisers’ International Machinery and Technical Specialties Committee. He has written a comprehensive exam for the Commercial Marine Appraisal specialty and has written a 30-hour course for the American Society of Appraisers on appraising commercial marine vessels and yachts and is the lead instructor.

Areas of Expertise:

  • Commercial Marine Appraisal
  • Hull Damage and Repair
  • Cargo Loading, Securing and Trip in Tow Preparation

Education:

  • Maine Maritime Academy Graduate
    B.S. in Marine Transportation
  • Continuing education credits in Law, Appraisal, Marine Survey, and Diesel Repair.

Professional Certification/Memberships:

  • NAMS Regional Board of Directors Member 1989-1994
  • American Society of Appraisers – Chapter Treasurer 1991-1994
  • American Society of Appraisers – Chapter President 1994-1995
  • Mark Twain Club (Charter Member)
  • Machinery and Technical Specialties International Committee 1995-Present

Publications

  • The Journal of the International Machinery & Technical Specialties Committee of the American Society of Appraisers “TUGBOAT DESIGN 101” Vol 13 No. 2 Fall 1996
  • The Journal of the International Machinery & Technical Specialties Committee of the American Society of Appraisers “KEEPING AN EYE ON YOUR MARINE ASSET” Vol 13 No. 3 Winter 1996
  • Marine Money, The Ship Finance Publication of Record “ASSET BASED APPRAISAL:, Vol. 21, No. 3, May/June 2006 Wrote the chapter on Marine Asset Appraisal for the American Society of Appraisers text book: “VALUING MACHINERY AND EQUIPMENT: THE FUNDAMENTALS OF APPRAISING MACHINERY AND TECHNICAL ASSETS” Second Edition. In 2008, revised the chapter for the future Third Edition and wrote an accompanying Work Book section.

Email: nlaskay@dlsmarine.com

  

Harry Ward President DLS Marine

Harry Ward

President

Harry Ward is the President of Dufour, Laskay & Strouse, Inc. Harry is a US Navy veteran and has spent much of the past decade in the maritime industry in sales, finance and general management. He has extensive experience in asset and business valuation and is working to maintain DLS leadership in marine appraisal and survey for another 50 years. Harry is a graduate of the US Naval Academy and served as a helicopter pilot and survival instructor through multiple tours of duty. He has an MBA from San Diego State University.

Areas of Expertise:

  • Fleet and Vessel Appraisals
  • Marine Business Valuation
  • Transaction Support – Due Diligence
  • Transaction Support – Marine M&A Advisory
  • Digital Inspection – Marine and Offshore Wind

Education:

  • U. S. Naval Academy, Annapolis, MD – 1991, Bachelor of Science
  • San Diego State University, San Diego, CA – 1999, MBA with emphasis in Finance

Licenses and Professional Associations

  • FINRA Licenses, Series 63 and 79 (Investment Banking)
  • American Society of Appraisers, AM
  • Certified Exit Planning Advisor, CEPA (Business value assessment and strategy development