Tankers: Texas ports open but draft restricted as lightering rates jump

Lightering day rates have soared as draft restrictions along the Texas coastline keep fully-laden dirty products tankers from coming into ports seen still dredging silt in the wake of Hurricane Harvey.

“Delays are killing everyone … there are no safe itineraries right now,” a source said as ports and the US Army Corps of Engineers work to get storm-ravaged port facilities back to pre-storm activity levels.

HOUSTON SHIP CHANNEL OPEN BUT RESTRICTED

All Texas ports are open with restrictions in place.

The Houston Ship Channel below the Sidney Sherman Bridge is open with draft restrictions.

The entrance to the channel to Houston Cement West is open to vessels with 40 to 42 feet drafts, according to shipping operations sources.

The draft is restricted to 36 feet from Houston Cement West to the Sidney Sherman Bridge and movement is restricted to daylight only, one-way traffic for larger vessels with prior approval and coordination between Houston Pilots Association and the US Coast Guard Vessel Tracking Service.

The Corps has finished surveys and is carrying out dredging in different areas, shipping operations sources said, as well as issuing a contract for removal of 10 obstructions along the channel.

Authorities are focused on getting the channel back to its pre-storm level of a 46 foot draft, using the mean low water, sources said.

Calculating draft for the ship channel is a tricky proposition as it is dependent on cargo density.

“I know at 38.5 feet you could do like a full load of Eagle Ford, but that is light, so a [Panamax] is OK probably,” he said.

For Aframaxes it would be even more dependent on the cargo, he said, adding: “Mexican and Venezuelan crude might draft too much.”

OTHER TEXAS PORTS

The port of Corpus Christi is restricted to vessels with drafts not exceeding 43 feet, with daylight restrictions in place for vessels exceeding 900 feet in length and greater than 130,000 dead weight tons, according to a ship agency.

Drafts on the Sabine and Neches rivers leading to the ports of Beaumont and Port Arthur, Texas, appear to be the most limited by significant silting from the storm, sources say.

Substantial shoaling on the Neches River from ExxonMobil Dock 4 to the Port of Beaumont meant the maximum draft would be limited to 26 feet, according to the USCG.

A draft restriction of 36 feet is in place from Neches River Light 68, located near Stewts Island, to ExxonMobil Dock 4 and 38.5 feet on the Sabine-Neches Waterway from Sabine Bank Buoy SB, located offshore, to Neches River Light 68.

IMPACT ON LIGHTERING OPERATIONS

The restrictions and accompanying delays caused a substantial uptick in lightering activity, sources said, with rates surging.

“I heard some lightering done at $26,500 per day,” a source close to the Aframax lightering market said Thursday.

He added this was lower than last week where rates were seen exceeding $30,000/day.

A source engaged in the lightering market said day rates were $16,000/day before the storm.

Charterers were heard offloading partial cargoes to decrease their drafts before being able to come into port, several sources said.

“I heard that straight from a lightering company,” said a market source.

Although lightering activity has eased off this week, tonnage was still tight in the Gulf of Mexico, leading to a shortage of vessels to engage in the business.

“Lightering companies are swamped with business right now and [lightering vessels are] running late for several deals,” said a shipbroker.