As a U.S.-based company, OSG’s U.S. Flag fleet (with the exception of two vessels) trades under the provisions of the Jones Act, a U.S. law enacted in 1920. The Jones Act requires vessels transporting cargo between contiguous U.S. ports to be built in the United States and owned, operated and manned by U.S. citizens. The Jones Act plays an important role in the maritime industry and is considered critical to homeland security.
We are one of the largest commercial owners and operators of Jones Act vessels in the United States with a trading presence in all four U.S. coastwise markets: intra-U.S. Gulf, U.S. Gulf to the West Coast, U.S. Gulf to the East Coast and the Alaska North Slope. The Company's owned and operated U.S. Flag fleet comprises Handysize product carriers and articulated tug barges.
OSG played a vital role in the revitalization of shipbuilding in the United States through its U.S. Flag fleet replenishment, which began in 2005 with an order for ten Jones Act product carriers. Along with the ten product carrier constructed at Aker Philadelphia Shipyard, an additional two vessels were converted to shuttle tankers.
In 2006, OSG acquired Maritrans Inc., a leading U.S. Flag crude oil and petroleum product shipping company. The acquisition significantly expanded OSG’s U.S. Flag presence with the addition of vessels and a technical and commercial staff based in Tampa, Florida.
In 2007, OSG was awarded the first contract to supply U.S. Flag shuttle tankers to transport oil from Floating Production Storage and Offloading (FPSO) facilities at the Chinook and Cascade ultra-deepwater fields in the Walker Ridge area of the Gulf of Mexico. Operations commenced in 2012. In 2013, OSG increased its shuttle tanker presence by one as a result of a contract award by Shell Trading Company, to supply crude transportation from its STONES field to U.S. refineries.
Two OSG vessels participate in the U.S. Maritime Security Program (MSP), which ensures that militarily useful U.S. Flag vessels are available to the Department of Defense in the event of war or national emergency. These vessels are required to trade outside the United States but are eligible for government-sponsored business. Under the program, OSG receives an annual fee, subject in each case to annual Congressional appropriations, in exchange for a guarantee that the ships will be made available to the U.S. government in the time of war or national emergency.
Minority Interest Investment
OSG holds a 37.5% stake in Alaska Tanker Company, a joint venture formed with BP p.l.c. and Keystone Shipping Co. to manage the fleet of ships that transport BP’s Alaskan North Slope crude oil from Valdez, Alaska to market destinations.