A significant competitive edge for Norwegian shipping is the unique synergies emerging from a well-developed cooperation between all of the major players in the Norwegian maritime cluster. Oslo is an important international financial centre for shipping, and in the northwestern part of the country, the Møre cluster features an extraordinary closeness between the players – enabling projects to be implemented shortly after they have been designed on the drawing board.
Taking advantage of the continuous exchange of knowledge between shipowners, designers, equipment manufacturers, engineers and shipbuilders, the Ulstein Group is one of the world’s most effective organizations in the implementation of shipping projects soon after the idea has been born. Ulstein and most of its subcontractors are located in the Møre cluster.
“We are not very formal and theoretical. When we have a good idea, we implement it as soon as possible,” says deputy CEO and director of market and business development of the Ulstein Group, Tore Ulstein.
One example of the rapid implementation of projects is the Ulstein AX104, an anchor handling tug supply vessel. Handling anchors in offshore installations can be very challenging in rough seas, so sufficient power in the most important areas is an absolute necessity. The AX104 is the first anchor handling tug supply vessel with a diesel-electric propulsion system.
“This is important because it gives us a lot more flexibility. These ships are often in one location for a longer period of time, and with a diesel-electric system we are able to apply several diesel aggregates when we need full capacity,” Ulstein explains.
And extreme power is truly needed to hold offshore installations in place. Winches have to be able to withstand pressure of 500 tonnes and the ship’s bollard pull must be as much as 300 tonnes.
Ulstein is especially pleased with the ship’s new hull shape. “Her bow is the reverse of a conventional bow, leaning backwards instead of forwards, and thus, the vessel cleaves the waves, significantly reducing noise and vibration,” he explains, adding that the third AX104 innovation is an entirely new anchor handling system, including a new stern ramp, moveable towing pin, cranes mounted on cargo rails and equipment for catching the pennant wire.
“The AX104 started as a vision, and then developed into a concept design. The cooperation in the Norwegian maritime cluster has also been an important part in turning this vision into reality,” says Ulstein.
The market for offshore vessels has never been better, and while Ulstein is very aware that such times can’t last forever, he believes the Norwegian maritime cluster will continue to give the company a competitive edge, “We have to intensify our efforts to become more international, and at the moment we are building vessels in Brazil and China. The national market is vulnerable, and therefore we need more strings to play on.”
Within the Møre Cluster, the competition is hard, but not too hard. It is a strong cluster because of the cooperation. “We cooperate when we can and compete when we have to,” says Ulstein.
In the Møre cluster in northwestern Norway, there are short distances between the drawing board and the implementation of shipping projects. One example of this is the Ulstein AX104 anchor handling tug supply vessel.
© Ulstein Group
Investing in Human Capital
Rolls-Royce Marine, one of the world’s leading marine systems companies, has more departments and production facilities in Norway than in any other country – most of them situated in the Møre cluster. Consequently, all companies in the Norwegian maritime cluster, whether in Møre or elsewhere, have a common interest in investing in human capital. While these have been heady times for Norwegian shipping – and for the Norwegian economy as a whole – this also means intense competition in order to recruit the best people. Therefore, education is an important element in the maritime cluster.
Rolls-Royce Marine director of research and technology, Rune Garen, is very familiar with this issue. “We have to involve ourselves in the proper mechanisms to recruit the human capital needed for advanced shipping applications. It is unfortunate when we have to turn down business because we don’t have enough competent people,” Garen says.
As one of the major players in ship design and ship’s gear in Norway, British-owned Rolls-Royce invests heavily in research and technology. This results in demands to Norwegian universities and colleges, and thus, Norwegian students gain specific skills needed by the industry.
Rolls-Royce has also formalized its cooperation with the Norwegian University of Science and Technology (NTNU) and the Norwegian Marine Technology Research Institute (MARINTEK) located in Trondheim, a central city in the Norwegian maritime cluster. Together with Ålesund University College, located close to Rolls-Royce Marine’s headquarters in Ulsteinvik, Møre, these universities and research institutions provide the industry with exactly the expertise demanded in a competitive environment.
“Rolls-Royce chooses universities and institutions worldwide with potential areas important for the company. The skills acquired in educational institutions are closely connected with a system of innovation, and we want the students to think locally and act globally,” Garen says.
Some years ago, capital to finance shipping projects was sometimes a problem, but now the challenge is to find the proper human capital. However, Garen is optimistic that Norwegian shipping will continue to recruit the best professionals and the brightest heads for the further development of the industry.
“Some Norwegians think we are a nation of peacemakers. This is not true. We are a small, insignificant nation, but when it comes to shipping, we are a maritime superpower. The world listens to us,” he says.
Even with the focus on maritime training and education, the Norwegian shipping industry cannot depend solely on domestic competence in order to handle all of the challenges from an increasingly technologically advanced industry.
Tor Espedal is the vice president of the Norwegian division of Subsea 7, one of the world’s leading subsea engineering and construction contractors. Together with the Norwegian Shipowners’ Association (NSA), Odfjell Drilling and Acergy, the company wants to recruit 50–60 Russian engineers annually to several shipowners and offshore companies. “We don’t have enough engineers, and Russia has a good reputation when it comes to educating students in mathematics and science,” he says.
Norwegian ships also depend on international experts to operate ships, and the Philippines, Russia, China and the Baltic countries are vital in providing the professionals needed. Since 1999, 1,200 Chinese sailors have been recruited and educated through the China Coordination Council for Overseas Seamen Employment. And the Philippines is the biggest supplier of sailors to Norwegian ships, with recruitment stemming from the Norwegian Training Centre – Manila.
Centre of Expertise
To take advantage of all of the aspects of the Norwegian maritime cluster, the Norwegian government have supported the start-up of the Norwegian Centre of Expertise – Maritime. Because the Møre region has the most complete maritime cluster in Norway, the authorities chose to locate the core administration in Ålesund, the largest city in Møre. Annually, the Møre cluster generates about NOK 25 billion, but in ten years the goal is to quadruple the amount to NOK 100 billion.
The director of the Centre of Expertise, Per Erik Dalen, is aware that this is a very ambitious goal, but doesn’t feel that it’s out of the realm of possibility. “It is a realistic goal. Our vessels are increasingly advanced, travelling in deeper and colder waters and operating in extreme subsea conditions. We started off with fishing boats, but now we are talking about advanced vessels for the offshore industry,” says Dalen.
The centre opened in the fall of 2006. “The companies are the experts, and here there are people who are dedicated to serving them. Furthermore, we will give them significant academic competence,” he adds.
The goal of the expertise centre is to connect the various players in order to ensure the foundation for cooperation between the companies and make sure that shipping projects have enough capital in the different phases of business development. “We want to be active in marketing our cluster and the general activity so that it can be visible for all relevant parties,” Dalen says.
Norwegian Minister of Trade and Industry Dag Terje Andersen was also present at the opening of the centre, and he is proud and excited that the Møre cluster is an international leader and an example to others. “The northwestern corner of Norway is a centre for innovative and world-leading shipping companies. You have created a complete cluster,” Andersen said, emphasizing the advantage of a close cooperation.
Oslo Maritime Network
Serving as the Norwegian Minister of Trade and Industry from 2001 to 2004, Ansgar Gabrielsen developed and still has a passion for shipping. The former minister initiated the Oslo Maritime Network in the fall of 2006. Gabrielsen wants to inspire the shipping industry in the Oslo region to pull together, and to realize that it has tremendous competence – without necessarily needing to recruit professionals from far away.
However, Gabrielsen doesn’t see a contradiction between strong shipping clusters in the Oslo region, Møre, southwest Norway, western Norway and other maritime environments in Norway. He views all of the areas as one big cluster.
In the same way as Møre, Oslo has its own advantages. “Oslo has one of the world’s most complete clusters, except for the shipbuilders,” says Gabrielsen from his office at the NSA. “We have big shipowners, ship finance institutions, shipbrokers and classification companies. Furthermore, large parts of the legal and educational institutions are located in Oslo.”
In Oslo, there are about 1,000 companies involved in shipping in one way or another, and Gabrielsen wants the Oslo Maritime Network to increase the awareness about the importance of the maritime-related companies in Oslo in both in the professional and general population segments.
“We don’t want to build a huge administration, but we want to encourage innovation between traditional maritime companies and companies not immediately connected with the maritime industries. We can take advantage of some important synergies here,” he says.
Gabrielsen admits that other areas in Norway have been better able to take advantage of these synergies. “The maritime industry has been more fragmented in Oslo than in other parts of Norway, but we want to connect companies together in order to help them discover their mutual dependence on each other,” he says.
Financing Global Shipping
The world’s shipping markets need reliable and secure funding, and Norwegian banks and financial institutions play a vital role in financing, insuring and advising on global shipping activities.
Norway has two heavyweights when it comes to ship financing. The Nordic bank Nordea, with shipping headquarters in Oslo, has global shipping commitments of $12.5 billion, while Norway’s largest bank – DnB NOR – has corresponding figures of $11 billion. These tallies place the two banks alongside Citibank as the three largest ship finance institutions in the world.
“Combined, these two banks give a tremendous boost to the market,” says Carl E. Steen, head of Nordea’s shipping, offshore and oil services division.
Even if the Norwegian stock market is small by global standards, the Oslo Stock Exchange is one of Europe’s – and possibly the world’s – leading stock exchanges for the shipping industry. “Norwegian shipping analysts are highly skilled, and they provide quality analysis of the individual companies and the different segments in the industry,” says Oslo Stock Exchange senior vice president Per Eikrem.
In addition to shipping finance, Norway is also one of the driving forces within marine insurance, represented by flagships Skuld and Gard. Combined, Norwegian insurance companies have about 15 percent of the global shipping insurance market. “Our workforce possesses a unique mix of expertise in marine insurance, energy insurance and claims handling, as well as a broad range of professional qualifications and practical experience,” says Gard CEO Claes Christian Isacson.