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updated: 8/28/2014 8:20 AM

New ship rules come amid worst barge spills since 2008

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Bloomberg News

Tighter regulation of U.S. ships carrying record exports of diesel and gasoline is coming amid the worst year for oil spills from barges since 2008.

Coast Guard rules to be issued within the next 90 days would require commercial vessels nationwide to be equipped with Automatic Identification System, or AIS, technology, which uses transponders and electronic chart displays to alert pilots to neighboring ships, according to trade group American Waterways Operators. A pending inspection regulation would bring ships more in line with trains and trucks that carry similar cargo.

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Growing amounts of shale oil that's made the U.S. the world's biggest energy producer moves through inland waterways on ships almost twice as long and that carry 10 times the load of vessels plying the same routes in the 1960s. Export traffic on the Houston Ship Channel in 2013 rose 8.8 percent to a record 109.2 million metric tons. Towing vessels or barges were involved in 1,852 accidents and other mishaps nationwide last year, up 4 percent compared with 2012.

"More traffic is indicative of more opportunities for things to go south," Steven Nerheim, director of the Coast Guard's Vessel Traffic Service for Houston-Galveston, said in an Aug. 4 phone interview. "Think about the size of the average merchant ship 50 years ago and then think about the size of the ships today." He added: "You're dealing with 100,000-ton things."

Houston Collision

A March 22 collision in the Houston Ship Channel, which closed the country's largest export gateway for three days, spilled 168,000 gallons of oil from a barge, making this year the worst since at least 2008, when 286,653 gallons were lost from tank barges, according to a July 30 report by the Coast Guard and American Waterways Operators. There were 17,529 gallons spilled last year.

AIS is required in Vessel Traffic Service zones, the busy waterways monitored for ship traffic by Coast Guard staff who watch radar and advise pilots, and has been voluntarily installed by other operators, Jennifer Carpenter, executive vice president of American Waterways Operators, an Arlington, Virginia-based trade group for the U.S. tugboat, towboat and barge industry, said in an Aug. 6 phone interview.

Compliance Cost

The group also is pushing the government to publish a towing-vessel inspection regulation that was authorized by Congress in 2004 and has yet to take effect. According to the Coast Guard, it doesn't issue inspection certificates to such vessels unless they are ocean-going and above 300 gross tons.

Based on Coast Guard data, the radar technology requirement is expected to cost the industry about $69 million to comply, including capital costs, installation and training, Ann McCulloch, a spokeswoman for the waterways group, said in an Aug. 26 e-mail responding to questions.

Adapting an existing safety management system in line with the pending inspection rule would cost about $15,000 per company, while the cost of creating a new, approved safety management system would range from $61,000 to $150,000 per company, McCulloch said.

"In spite of the costs, AWO and our members are very supportive of these proposed regulations," she said.

New regulations would make inspections more uniform, as they would apply to towing vessels that are 26 feet or longer, as well as any such ship pushing, pulling or hauling a barge carrying dangerous or hazardous materials.

Export Boom

Booming oil production and crude export restrictions have made the U.S. the most profitable refining center in the world and helped boost shipments of petroleum products such as gasoline and diesel to a record 3.3 million barrels a day in December.

In March, the Summer Wind, a 585-foot Liberian-flagged vessel operated by Cleopatra Shipping Agency Ltd. traveling at 12 knots, and the Miss Susan, a Kirby Inland Marine LP tug that was towing a barge carrying fuel oil at 4 knots, didn't realize they were on a collision course until a few minutes before the crash, even as a Coast Guard radar was tracking their positions through the channel. There's no speed limit in the waterway.

The AIS technology and inspection regulations may not be enough. The Miss Susan was already equipped with AIS, Matt Woodruff, Kirby's director of government affairs, said in an e- mail responding to questions.

Reverse Effect

Different types of vessels can handle in radically different ways, Kathy Metcalf, director of maritime affairs for the Chamber of Shipping of America, the Washington-based trade organization that represents U.S. shipping companies, said in an Aug. 7 phone interview.

Even the same ship can have a different turn radius or weather impact based on whether it's loaded with cargo coming into a port or empty after it leaves, Metcalf said, and because they travel relatively slowly in port, they're more often affected by wind and ocean currents.

"An invisible hand from shore can never take the place of the well-trained hand of the person operating that vessel," Carpenter said.

The new rules are being proposed as export volume is growing at ports in New Orleans, a major exporter of grain, coffee and petrochemicals; Los Angeles, where containers filled with raw materials and agricultural goods move offshore; and Norfolk, Virginia, a major coal hub.

Speed Limits

According to Coast Guard steering and sailing rules that mariners on U.S. waterways must follow, there is no specific speed that is defined as appropriate for all situations and types of vessels. The rules say that all vessels should consider visibility, traffic density, vessel maneuverability, lighting, and wind and sea conditions when determining on their own the appropriate "safe speed" to avoid a collision.

By comparison, trucks must follow posted speed limits, while the Federal Aviation Administration requires aircraft below 10,000 feet not to exceed a speed of 250 knots. Freight trains also are subject to speed limits on certain tracks.

U.S. barges and ships that operate in the Houston Ship Channel, home to the largest petrochemical complex in the country, generally are not inspected while in transit between locations, Gary Messmer, the Coast Guard's chief of prevention for the Houston-Galveston sector, said in a telephone interview Aug. 4. Those vessels are given an annual inspection and are subject to periodic audits.

Unlike foreign vessels arriving via the Gulf of Mexico or another country, they don't have to give 96-hour notice of arrival, he said.

Airline Rules

U.S. commercial airlines, by comparison, are required to file flight plans to be able to take off, and air traffic controllers maintain strict control over the airspace in which those planes travel. The FAA also requires business-jet operators to provide their origin, route and destination so the agency can manage traffic flow.

Coast Guard and shipping industry officials say they are open to a broader discussion of the regulations and level of oversight in the shipping industry as port traffic increases. Making those rules more similar to those for other modes of transport is complicated because conditions on the water can change quickly.

"We see the people who are best equipped to take action to prevent a casualty are the men and women who are operating those vessels using the tools that have been provided to them," Carpenter of the American Waterways Operators said.

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