Conoco and Maritrans to develop advanced shuttle tanker technologies

Conoco and Maritrans announced that they are jointly developing advanced shuttle tanker technologies to safely transport newly discovered deepwater Gulf of Mexico crude oil reserves to US refineries more economically than current pipeline alternatives. Technologies being evaluated have the potential to greatly reduce the time between discovery and production of deepwater crude reserves.
"The industry is actively exploring for the 10 bn barrels of crude oil reserves that are estimated to be contained in the deepwater Gulf of Mexico," said Rob McKee, Conoco executive vice president for exploration production. "Operations in deepwater are expensive, and we are continuously seeking ways to improve the economics of our deepwater program. Reducing the time between investment and the return on that investment makes deepwater exploration even more attractive than it is today," he emphasised.
The companies said they had decided to proceed with development plans as the Minerals Management Service (MMS) continues to evaluate the use of shuttle tankers to transport crude oil production in the Gulf of Mexico. The MMS is expected to make a final decision next year.

"We are hopeful the safety and performance records of shuttle tankers used in other parts of the world will help convince the MMS the concept is suitable for use in the Gulf of Mexico," said Eric L. (Rick) Oshlo, Conoco vice president and general manager of supply and trading. "If the MMS does approve the concept for use in the Gulf, Conoco and Maritrans will have state-of-the-art technologies ready for deployment," he said. "If they don't, we will have some very innovative ideas that would be applicable to help other nations develop their deepwater reserves, quickly, safely and economically," Oshlo added.
Oshlo said the companies were evaluating variations of shuttle tankers and deepwater loading systems successfully used elsewhere in the world to transport remote crude oil reserves to determine their applicability in the Gulf of Mexico. Conoco's world-wide fleet of double-hulled ships includes the "Rangrid," a specially designed, state-of-technology shuttle tanker used to transport crude oil from the Heidrun field in the Norwegian Sea to European markets.
The Heidrun field, located north of the Arctic Circle and in some of the world's stormiest seas, could not have been economically developed without the use of shuttle tankers and proprietary loading systems. Direct shuttle loading from Heidrun to the "Rangrid" and other shuttle tankers boasts an unprecedented 100 % uptime since first oil was produced in 1995.

Over 25 years ago, Maritrans pioneered the lightering system that supplies almost 100 mm barrels of crude oil each year to eight refineries in the Northeast United States. Maritrans' sophisticated vessel allocation process is designed to reduce on shore crude storage and keep deliveries on a consistent, reliable schedule. Maritrans' multi-vessel system for unloading cargo directly from large oil tankers situated offshoreand in the Delaware Bay remains the most cost-effective alternative for delivering foreign crudes.
"Conoco and Maritrans are working as quickly as possible to finalise our approach for Gulf of Mexico shuttling before we begin talking with prospective third-party customers for the system," said Stephen A. Van Dyck, chairman and CEO of Maritrans. "Our first concern will be to ensure an environmentally sound operation," he emphasised.

Conoco is a major, integrated energy company active in more than 40 countries. The company's nine double-hulled vessels, including two deepwater drillships, are managed by Conoco Shipping. Conoco, the first US oil company to commit to building only double-hulled tankers, has operated an all double-hulled tanker fleet since 1998 and was rated the safest US shipping company in 1998 and 1999 by the National Safety Council Benchmarking Study.

Maritrans is a US-based company with a 72-year commitment to building and operating petroleum transport vessels for the US domestic trade. The company owns and operates 15 oil tankers and large, integrated tug/barge units, of which six are double-hulled. Maritrans has been recognised with the United States Coast Guard's prestigious William M. Benkert award for environmental safety and compliance three times since the award's inception in 1996.