05 December 2023
Ulstein study: Shipping companies regularly choose vessel conversions to secure a new life in another segment. Hence, increase the competitiveness of the tonnage. Why is this a sustainable choice?
Conversion projects of offshore Oil & Gas vessels are in demand. On a global basis, an average of 180 vessels receive conversion each year. The majority of these conversions are related to tankers and general dry cargo vessels. However, the offshore vessel conversions have increased after 2014. This is a consequence of the downturn of the Oil & Gas market.
The conversion projects are an alternative to achieving competitive and more sustainable tonnage that can be available faster and at a lower cost than newbuilds. Conversions result in substantial CO2 emission savings due to the reuse of existing tonnage. Platform Supply Vessels (PSV) are one of the single largest sources of conversions of offshore vessels in the last 5 years.
Three reasons why PSVs are great conversion assets
PSVs are a good platform for many conversion applications primarily for three reasons.
- Most of the vessels have sufficient energy-generating capacity to cater for the additional demand of the new functionality. Thus, most likely, there is no need to make a major adjustment to the power plant. This would require major investments concerning time and money.
- The vessels have a large open deck arrangement. This means that additional functionality can be easily implemented on the top of the aft deck without requiring changes to the structural hull.
- Most of the tonnage built for operations in the North Sea have high-quality standards (a large portion of the fleet features ice class 1C) incorporated in the design, which secure a long lifetime of the vessels.
Business strength and an environmental benefit
Giving a second life to existing tonnage does not only represent a business strength (typically lower cost and shorter lead time than newbuilds). But also an environmental benefit.
The environmental benefits range from;
- CO2 emissions generated during the production of the vessel
- The production and transportation of systems and equipment on board
- Recirculation of the vessel.
- Reducing visual and local contamination, as some areas have accumulated laid-up tonnage that is rusting.
Massive reductions in CO2 emissions
There is a large potential in the conversion of PSVs due to their; energy generation capacities, open deck, and high-quality standards. For instance, a conversion of a PSV to a Service Operation Vessel (SOV), can lead to large CO2 savings compared to newbuilds. The total CO2 emissions produced when converting a PSV to an Offshore Wind SOV fall in the range of up 5,500 to 6,000 tonnes.
Based on the characteristics of the base-ship, the conversion may require;
- Installation of a gangway to perform personnel transfers
- Facilitate new cabins
- Removal of underdeck storage tanks
- Energy storage systems installation.
It is likely that the conversion of a PSV will require adding additional cabins and public spaces. This is due to the people onboard capacity (POB) of SOV. It is 3 to 4 times larger than that of PSVs.
However, an SOV newbuild will lead to the emission of 20,000-25,000 tonnes of CO2 during its production. Note that the largest source is the production and transportation of equipment and components in the vessel.
As a result, the conversion leads to more than 15,000 tonnes of CO2 savings. These savings are equivalent to the CO2 emissions of the vessel operating during a 3-year period.
The converted vessel will therefore have a lower lifecycle footprint. This occurs even if used for 30 years compared to a purpose-built new build vessel.
In this example, the estimated numbers are based on a generic conversion. The actual emissions for a particular vessel will vary. With up-to-date environmental-friendly power solutions, the vessel will be a fully competitive asset to your fleet within the time span of a few months.
Conversion projects can be further enhanced by the implementation of alternative energy technologies such as batteries.
Project management and design expertise
The design, project planning, and execution are very important factors to consider for successful vessel conversions project. Ulstein Group, with experience in the design, construction, and service of more than 100 offshore vessels is firmly positioned to evaluate, develop and execute conversion projects.