ABS sheds light on tackling the challenges of the COVID-19 pandemic

English

By Delilah Rodrigues

As a world-renowned classification society, ABS has continually been committed to setting high standards for safety, efficiency and excellence in the industry. The company has constantly kept pace with the ever-evolving and dynamic market. Crucial to its operations is its noteworthy work alongside other industry stakeholders. ABS supports the industry to tackle an array of roadblocks including technical, operational and regulatory challenges, to facilitate the smooth functioning of the marine and offshore industries.

The recently held ABS Middle East Regional Committee Meeting highlighted some of the key developments in the company during the challenging year that 2020 was. Discussions focused on topics ranging from sustainability, digitalisation, cybersecurity and more.

Coping with COVID-19 challenges

The event commenced with an opening speech by Capt. Abdulkareem Al Masabi, ABS MERC Committee Chairman and ADNOC L&S CEO. Sharing his thoughts on how the industry was impacted by COVID-19 and how businesses responded to the disruption caused by pandemic, he said, “I would like to commend ABS, its leadership and its worldwide team for their commitment, setting standards as the world’s leading marine classification organisation. I commend them for adjusting so swiftly to the new norm, offering innovative services as we all navigate through an exceptionally challenging year. ABS is a valued partner of ADNOC L&S. Their team of experts have the ability to find solutions to the challenges brought on by global shutdowns and quarantine. Their support has been integral to our efforts to expand our fleet even as the pandemic unfolds.”

He added, “The maritime industry was impacted by the pandemic. Global trade almost came to a standstill, charter rates were in a freefall and supply chains were disrupted. Mostly, due to shutdowns, global movements were restricted. This resulted in the worst humanitarian crisis ever faced by the industry and securing our crews’ wellbeing and sending the seafarers home was our top-most priority. As an industry, we are all expected to maintain the highest standards of quality even in the face of heavily tightening markets. Substantial investments are needed to continue to ensure the shipping industry keeps pace with innovations and a renewed sense of environmental responsibility.” 

Capt. Al Masabi’s address was followed by an overview by Chris Wiernicki, Chairman, President and CEO of ABS who emphasised the importance of trust, teamwork and technology to overcome roadblocks during the pandemic. He also spoke about the significance of digitalisation, its impact on the industry and the lessons learned in light of the pandemic. Speaking about the growth in business despite the pandemic, Wiernicki said, “Through 2019, we experienced various economic and industry fundamentals that allowed us to grow the ABS class fleet to 267 Million Gross Tonnes (MGT). This helped us maintain our leadership role in the global offshore industry and the overall port state control performance as one of the top-performing recognised organisations in all three of the most active port states in all regions of the world. In 2020, ABS continued to grow the fleet, now in excess of 270 MGT.”  

Post this, enlightening discussions on regulations in the industry and the acceleration of digitalisation were held. Despite a difficult year, ABS gained numerous exciting projects that strengthened their position in the industry. The company won their first NC project with ADNOC L&S and Wanhua JV and AW Shipping for 3+2 VLGCs in China. They also have two NC LeTourneau 116Cs with Lamprell for IMI/ARO with the basic design completed and negotiations for detailed design ongoing for the 18 + jackups at IMI 2030. 

Chris Greenwood, Director of Regional Business Development, Middle East & Africa said, “2020, whilst a challenging year, did allow us to participate in several exciting projects with a number of new and existing clients. We are excited about the opportunity to work with ADNOC. We are also looking forward to being able to support the Kingdom of Saudi Arabia 2030 vision through a range of exciting collaborations.”

Market outlook

The offshore market was facing a downturn prior to the COVID-19 crisis with a drop in oil prices. The pandemic further worsened the market condition with projects being delayed or postponed indefinitely and companies along the supply chain facing substantial difficulties. Gautam Lahiry, ABS Manager, MEA Regional Business Development said that the demand for both new offshore exploration and production projects will remain very weak. Delivery delays coupled with a large number of builder stock orders have slowed the orderbook decline. 

He also stated that the offshore energy industry will continue to stagnate due to low oil prices. Weak oil demand growth and excess supply from global high production levels have driven down oil prices. $45-60/bbl Brent may be the new norm until 2020. 

Prior to the first quarter of shock, the orderbook witnessed improvement with deliveries of stranded stock orders and an uptick in the production of new orders. However, when the pandemic hit new orders dried up. Analysts predict a continued low oil price environment will drive down the orderbook to only 32 per cent of its recent 2014 peak. The orderbook is projected to bottom out in 2021 at 13 per cent of its 2013 peak (1,286 units) with gradual growth thereafter, nearly doubling in 2026 but still at 2018 level.

The need for sustainability and decarbonisation

Sustainability has been at the core of operations at ABS. The organisation works closely with industry stakeholders to advance key areas of research like vessel design, future fuels, digital technologies and decarbonization pathways. Currently, ABS is involved in a number of studies and projects with Bahri, Oman Shipping and Nigeria LNG on dual fuel, energy-saving devices, EEXI and 2030/2050 pathway studies. 

Georgios Plevrakis, ABS Director, Global Sustainability stated, “Sustainability in the industry is based on three pillars: environmental excellence, social responsibility and governance. In order to respond to the sustainability challenges that have emerged in the maritime industry, ABS has established four sustainability centres: Houston, Athens, Copenhagen and Singapore.”

“The key driver behind the current decarbonization effort is the regulatory framework established by the IMO. The IMO has certain long-term ambitions that include reducing the carbon intensity by 40 per cent until 2030 and by 70 per cent by 2050 in combination with a 50 per cent reduction of total greenhouse gases by 2050. The short term measures aim to accelerate the compliance with the long-term goals through the adoption of an efficiency design measure, the Energy Efficiency Existing Ship Index (EEXI) which apply to all existing ships and the operational measure, the carbon intensity indicator which will track the actual carbon intensity of the vessels, applying a reduction trajectory,” he said.  

As the industry traverses through a challenging period where sustainability has become integral for operators, investors and countries, investments and government incentives will play a key role in the offshore drilling industry adopting green measures. ABS has class notations (ENVIRO-OS) or Environmental Protection – Offshore Plus (ENVIRO-OS+) ABS Guide For The Environmental Protection Notation For Offshore Units, Floating Installations, & Liftboats. They also offer services to measure and record GHG emissions and determining carbon footprint or carbon intensity.

To meet the IMO goals, major decarbonization efforts will be required across the industry. ABS categorizes decarbonization solutions into three main categories –– alternative fuels and energy sources, technology improvements and operational measures, which help to create a landscape that will impact the valuation of shipping asset and the competitive advantage of fleets. ABS emphasised that the following period up to 2023 will be crucial for the development of new projects, fleet renewal and decision making in the second-hand market.

Additionally, in their recently published Low Carbon Shipping Outlook, ABS presented a forecast of the fuel mix from 2025 to 2050. It is expected that the 2050 fuel mix will consist of 40 per cent of oil-based fuels and 35 per cent of zero-carbon fuels, ammonia and hydrogen. The remaining will be LNG, LPG, methanol, and biofuels. 

Adoption of digitalisation

The COVID-19 pandemic transformed operations in the maritime industry. Manual operations were replaced by digital techniques. Although ABS had been developing technology-enabled solutions for several years, the pandemic accelerated the process, prompting them to innovate with their data and digital capabilities, effectively putting to use pioneering technologies in the maritime industry.   

In 2020, ABS worked on a Condition Based Class pilot project with P&O Maritime Logistics (POML) using their OSV; the DMS Courageous and employing ABS Nautical Systems, Remote Surveys, and POMLs organic data to move towards a condition-based maintenance approach. They also have ongoing digitalisation and cybersecurity projects with IMI Shipyard in Saudi Arabia.

Speaking at the Digital Class forum, Greenwood asserted, “Digitalisation is an important part of the future of ABS and the future of the offshore and maritime industries. Due to the ever-evolving challenges, future fleets need to remain competitive in the market. We must continuously improve to ensure we are able to provide value to our clients through these digital and data-driven technologies. New regulatory pressures mean more efficiency is needed from a vessel, which means new designs are needed. We at ABS ensure that we help our clients, members, and industry stakeholders across the spectrum in their digital transformations.” 

ABS has devised several initiatives this year to lead the industry towards an era of digitalisation. Commenting on the industry’s move away from paper documentation towards adopting digital means, he added, “The real value here is the potential to eliminate 2D paper documentation entirely from the process. This offers significant benefits in terms of enhanced visibility, leading to better safety insights.”

Smart technologies 

ABS is working with 17 different major shipyard and designer clients on 3D design review. Greenwood explained, “Imagine being able to just drag and drop ABS rules onto a 3D design to instantly confirm compliance.  We have working prototypes today and we think they will be a huge benefit to our designer clients and the industry as a whole. We see a day in the not-too-distant future where ABS Rule associations are included as part of the design disclosure.”

Greenwood stated that in the near future, Class will grow beyond Loads and Structure and will include other less visible safety validations through automation and autonomy, system inter-operability, and validation of quality software that is increasingly in control of critical mechanical systems.  He also said that the evaluation of these safety validations will be accomplished in the future through modelling and simulation tools to better assess the vessel’s operation and system performance in many conditions. “The same technology can be leveraged for advanced decarbonization studies and validation, as well as time-saving virtual commissioning,” he said.

With advancements in technology, the role of cybersecurity becomes increasingly important. It is crucial to protect the safety of vessels that are highly connected software-driven systems, including protecting its systems from malware, viruses, ransomware, spoofing, and malicious loss of control. 

Some of ABS’ path-breaking initiatives include the ABS MyFreedomTM Client Portal that is powered by smart functionality and advanced analytics, the Client Portal allows partners a window into all ABS Class services.  One can access a unique suite of total fleet management and vessel compliance services – designed to provide intuitive and informed decision support. The portal also allows users access through the ABS mobile app. Schedule surveys, remote surveys, audits, access customized port state control analytics by vessel and ISM findings, calculation of estimated survey fees across multiple ports can be performed through the portal. 

Another Digital Class focus area for ABS is 3D Based Survey and Remote SurveyGreenwood informed, “We have helped our partners through thousands of surveys in 2020 where virtual attendance or alternative means were used to credit some surveys and limit the need of a surveyor to physically attend the vessel. The future of digital survey not only considers attending remotely, but also relies on the data from the systems and components themselves, reporting their condition to Class.” 

ABS has been working with both government and commercial clients to prove that machine learning algorithms connected to SMART machines that are already part of a modern fleet, can extend the client’s investment in sophisticated maintenance programs, as well as bring additional quality and insights to the Class surveyor’s decision-making toolbox.

 

Top