Utilization of U.S. Vessels and Mariners

The Maritime Administration's first priority under the Deepwater Port Act is to ensure that liquefied natural gas (LNG) imported into the United States is accommodated safely and securely as part of the on-going need to balance the nation's security requirements with our growing energy and economic needs.  

Deepwater ports serve as the nation's point of entry for vessels transporting LNG and oil to be delivered by pipeline for end use by consumers.  At present, the continental United States has two operational LNG deepwater ports and one oil deepwater port. Increased consumer demand for LNG and oil clearly will require new and expanded terminal infrastructure.

Additionally, it is estimated that as many as 3,700 to 5,000 additional mariners may be needed by the end of 2010. This increased need for additional mariners coincides with the growth of the global LNG fleet.  Over the last five years, the global LNG carrier fleet grew by 73 percent, from 128 to 222 vessels.  An additional 133 LNG vessels are scheduled for delivery to service the global LNG trades by 2010.  This expanded fleet will require as many as 10,000 additional seafarers, of whom almost 3,000 will be licensed officers.

Advances in LNG tanker size, the increased number of LNG carriers in the worldwide fleet, and improvements in LNG transfer technology have made importing energy ever more efficient and cost effective.  Accordingly, there is strong international competition from China, Japan, and Korea for both energy resources and mariners.  This intense competition within the LNG industry has led to the lack of a single U.S.-flagged LNG vessel.  As a direct result, this has limited the opportunities of U.S. mariners to gain vital hands-on experience in this growing industry. 

There is significant interest in building new deepwater ports to address the nation's future need for LNG (as previously mentioned, two (2) LNG terminals are already in operation, one oil terminal is currently in operation, five (5) LNG licenses for construction have been issued, and five (5) applications are currently pending).

Congress addressed the manning and security issue by amending the Deepwater Port Act through the Coast Guard and Maritime Transportation Act of 2006 (CGMTA) and to provide priority processing to applicants that commit to utilize U.S.-flag vessels at their proposed deepwater ports. The CGMTA directed the Maritime Administration to develop and implement a program to promote the transportation of LNG to the United States on U.S.-flag vessels. The CGMTA also requires applicants to provide the nation of registry for and the citizenship of officers and crew members serving on vessels transporting LNG to U.S. deepwater ports. 

The Maritime Administration is required to consider national interests in the issuance of deepwater port licenses. We consider the employment of American citizens aboard LNG vessels serving the nation's natural gas receiving facilities is in the best interest of the United States.  Placing the transportation of LNG under the control of U.S. mariners, who are subject to strenuous security checks, will add an additional layer of security to our nation's energy supply chain.

Under separate statutory authority, the Maritime Administration educates and trains future merchant marine officers for various employment opportunities within the maritime industry.  To this end, the Maritime Administration operates the U.S. Merchant Marine Academy and provides financial support to six state maritime academies.  All six state maritime academies and the U.S. Merchant Marine Academy, as well as other related training facilities, have indicated a strong interest in expanding their curricula to include course work focused on the unique demands of the LNG trade. 

Ultimately, the employment of highly trained and skilled licensed U.S. mariners will alleviate the growing worldwide shortage of professional mariners confronting the international LNG shipping industry.  It will also serve to support the industry's excellent safety record by maintaining the number of qualified mariners in the LNG officer pool.

U.S. mariners are highly skilled in the operation of steam plants used on the majority of LNG vessels and are experts in operating other marine main propulsion systems, such as diesel, diesel electric, and gas turbines.  In addition, America's maritime officers unions continue to train their members to the highest industry standards in LNG technologies.

We are already seeing results from our efforts.  As a result of this program, the Maritime Administration has entered into innovative public-private partnerships with several deepwater port license applicants.  Under one such agreement, Woodside Energy agreed to register its two LNG regasification vessels under the U.S. flag, provide training and employment opportunities for U.S. citizen officers, cadets, and unlicensed mariners serving aboard their tanker fleet and at their deepwater port terminal planned for construction and operation off the coast of Southern California. Other deepwater port applicants have committed to similar manning agreements with the Maritime Administration to develop programs to train and employ U.S. mariners on LNG vessels.

The Maritime Administration will continue to reach similar voluntary agreements with our pending and future deepwater port license applicants and other energy companies serving the nation’s international maritime markets.