DREDGING IN FIGURES 2012

INTERNATIONAL ASSOCIATION OF DREDGING COMPANIES

2
DREDGING IN FIGURES 2012
Dredging in Figures is an annual review of the
global dredging market. The document focusses
on the global dredging and maritime
construction industry over 2012. The IADC aims
to be thorough and precise in estimating the
fgures presented in this document. The statistics
provided here are based on information from
international sources as well as from IADC
member companies.
MARITIME SOLUTIONS FOR A
CHANGING WORLD
The worldwide need for maritime construction
keeps changing and so do the technologies
offered by the dredging industry. Increased
demands for clean energy, increased migration
of peoples within countries and internationally,
and growing urban hubs as well as threats from
rising sea level are a few of the challenges that
demand innovative dredging solutions.
Although the downturn in the global economy
which began in 2008 continued in 2012, the
drivers which affect the dredging industry
continue to stimulate demand. The growth of
waterborne trade, urbanisation and infrastructure
expansions, offshore and alternative energy and
climate change concerns remain in the forefront
of the global economy. These have resulted in
investments in innovations and solution-oriented
approaches by the dredging industry. Together
they have led to a 7% fnancial growth of the
market as a result of exchange rate changes
between the renminbi (CN) and the euro.
Dredging in Figures examines the industry
drivers, as well as the market turnovers in
different regions for different market drivers.
Despite economic uncertainty, dredging contracts
for new projects for port development and the
offshore industry have been strong in 2012.
Especially in South America and Australia, new
port infrastructure is being built. In the US
substantial funds for postponed harbour
maintenance and expansion work have been
allocated and work is underway to remedy the
lack of depth at various ports to meet
post-Panamax requirements. In the EU region
and elsewhere in Europe, austerity measures
have resulted in prudent fnancial policies, but
many investments in new infrastructure remain
on the drawing board for future development. In
China, the quantity of dredged material (in cubic
metres) in 2012 remained fairly similar to 2011,
although the overall turnover (measured in euros)
has grown substantially as a result of currency
exchange rates favouring the renminbi.
International institutions such as IMF, OECD,
UNCTAD and others provide well-supported
future outlooks on urbanisation. Graphs of the
other drivers for the dredging industry give
overviews of the historical situations.
WHAT DRIVES DREDGING?
Worldwide economic prosperity, as well as social
and environmental well-being, is directly related
to dredging, in particular to the construction and
maintenance of the maritime infrastructure.
In July 2013 the worlds largest container
ship the frst Triple-E ship commenced its
maiden voyage from Busan, South Korea to
Copenhagen, followed by number 2 in August
and number 3 in mid-September. A fourth vessel
in the Triple-E series will be departing in October.
In total 20 Triple E ships will come into service
in the next two years. Dredging is necessary
to ensure port expansion and maintenance, so
that these ships will be able to enter a suffcient
number of ports.
The offshore industry is as well dependent on
dredging, pre-sweeping, trenching and
backflling for pipelines and stabilising platforms.
These techniques allow the offshore industry to
explore deep waters for oil and gas in remote
parts of the world. Dredging also services
offshore windmill platforms.
The threat of fooding is addressed by the
dredging industry as they build coastal defences,
storm-surge barriers and reinforce shorelines to
prevent erosion.
High-tech, highly specialised and
capital-intensive those are a few adjectives that
describe dredging. On average the educational
level of employees at the major private dredging
companies is exceptionally high, with 40-50%
having a bachelors degree or higher.
In recent years the major international dredging
companies have broadened their operations,
developing from sub-contractors to main
contractors to Engineering, Procurement and
Construction (EPC) contractors. This allows them
to offer more comprehensive solutions to clients.
Also, they are offering more varied career
opportunities to their employees.
3
The impact of dredging on the global economy
is, in fact, far greater than its effect on direct
employment or industry turnover.
ENVIRONMENT
Incorporating environmentally sound working
methods is an integral part of most major
dredging projects. In most instances an
environmental impact study/assessment is a
pre-requisite prior to the start of the dredging
project. Environmental procedures are then
integrated into the totality of the work before,
during and after.
Remediation of contaminated soil during
maintenance dredging is common. This may also
be linked to capital dredging projects for new
maritime infrastructure. When adverse
environmental impacts are expected these are
usually mitigated or compensated in accordance
with local, regional and/or international
environmental regulations. Compensation often
produces new nature preserves, wetlands and
marine habitats, which then enhance tourism
and urban development. Remediation projects of
historically contaminated industrial sites, such as
brownfelds, are in and of themselves important
capital projects.
In recent years, this attention to environment and
sustainability has resulted in the development
of several programmes known as Working,
Engineering and Building with Nature. These
activities, often in public-private partnerships, are
devoted to research and testing of
innovative operational methods. The aim is to
create a synergy between ecology and
socio-economic development when planning and
executing dredging and maritime infrastructure
projects.
Since the United Nations formalised the
Ecosystem Services approach in 2005, this
concept has gained momentum. Balancing the
elements of the eco-social system is of
importance to the dredging industry and
infuences the way in projects are valued by
stakeholders and managed by clients and
contractors.
AWARENESS
Other developments in the dredging industry
include increased actions for Sustainability
and Safety programmes. The major dredging
contractors have developed their own Corporate
Social Responsibility action plans. The attention
to company-driven Safety plans has resulted in
heightened awareness amongst all industry
employees and a reduction in lost time injury
(LTI) rates. The IADC plans to investigate a
harmonisation of safety standards for the
industry.
SUSTAINABILITY
In line with other modern industries, all the major
dredging contractors have developed
programmes which refect their commitment to
sustainable development as well as their concern
with the areas in the world where their work is
executed.
Structural programmes, in which
contributions are made to local populations,
range from ensuring clean drinking water
and providing housing for local employees in
emerging nations to respecting the opinions of
stakeholders whose environmental concerns may
be the greatest priority. As part of these
CSR policies, some companies publish separate
annual CSR reports. These actions have
mitigated resistance to projects and provided
sound solutions that meet both the social and
economic needs of a particular community.
SAFETY
One of the highest priorities on every dredging
project is to ensure the safety of all personnel.
The major dredging contractors are in
compliance with international regulations and
industry standards expressed in various ISO
certifcates and OSHA regulations (US). Since
dredging companies work with heavy machinery
that require skilled workers, most major
contractors have developed safety training
programmes in-house. Besides regulations for
PPE and other standards, safety is emphasized
as a personal responsibility for each and every
employee from top management to dredging
crews. In some cases, outside professionals
have been brought in to establish, train and
supervise the implementation of these safety
systems. All these efforts have resulted in a
substantial decrease of Lost Time Injuries (LTIs)
between 2008 and 2012. Within some of the
IADC member companies, a reduction of over
50% has taken place.
4
0
10.000
20.000
30.000
40.000
50.000
60.000
Brazil China India Japan Russia United
States
European
Union
2000 2005 2008 2009 2010 2011 2012
DREDGING IN FIGURES 2012
DEVELOPMENTS OF DRIVERS
The GDP (Gross Domestic Product) graph shows
steady growth after the downturn of 2009
(-3.1%). In 2010 this was +4.9% (adjusted from
last years document where +4.3% was
reported); in 2011 it was +3.8% and in 2012,
+3.5% per capita.
WORLD TRADE
As mentioned above, container ships are getting
larger, putting increased demand on the
capacity and effciency of ports. Dredging
solutions support ports in meeting this challenge
by building new ports and hinterland
infrastructure, maintaining and deepening
existing channels and ports as well as supplying
dredged material for extending berths and quay
walls. Between 2000 and 2008 waterborne trade
increased with 37.2%. In 2009, however, as a
result of the global economic downturn,
waterborne trade fell with 4.5%. It picked up
again rather quickly: in 2010 waterborne trade
showed a growth of +7% as compared to 2009,
of +4% between 2010 and 2011 and of +5.9%
from 2011 to 2012.
Overall, in the period 2000 to 2012, the turnover
in capital and maintenance dredging for ports
and harbours grew from 2,000 mln to
6,680 mln, with a growth of more than 550 mln
in 2012.
According to Lloyds Register, based on todays
rate of growth, waterborne trade will double by
2030.
DEMOGRAPHY AND CLIMATE,
URBAN DEVELOPMENT AND COASTAL
DEFENCE
According to the United Nations, the world
population is growing, especially in coastal zones
and specifcally in urban areas. The UN predicts
that in the next two decades the worlds urban
populations will continue to grow by 195,000 a
day. At present, eight out of the ten largest cities
in the world are located along a coast. The
demographics in these urban areas will demand
more residential, recreational and industrial land
areas. This increases the economic value of
coastal areas which will therefore need
increased protection against sea level rise
caused by climate change.
Recent fooding in Western Europe caused by
GROSS DOMESTIC PRODUCT 2000-2012 IN
PPP PER CAPITA IN $
(Source: IMF)
GLOBAL SEABORNE TRADE 1980-2012 IN MLN TONNES
(Source: UNCTAD 2013)
CHAPTER 1: DEVELOPMENTS IN INTERNATIONAL SEABORNE TRADE 9
Source: UNCTAD Review of Maritime Transport, various issues. For 20062012, the breakdown by type of dry cargo is based on
Clarkson Research Services Shipping Review & Outlook, various issues. Data for 2012 are based on a forecast by Clarkson
Research Services in Shipping Review & Outlook, spring 2012.
F|g0re 1.2. |oteroat|ooa| seaboroe trade, by cargo type, se|ected years (N||||oos oI toos |oaded)
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
9 000
10 000
Container 102 152 234 371 598 969 1 076 1 193 1 249 1 127 1 275 1 385 1 498
Other dry cargo 1 123 819 1 031 1 125 1 928 2 009 2 112 2 141 2 173 2 004 2 027 2 090 2 219
Five major bulks 608 900 988 1 105 1 295 1 709 1 814 1 953 2 065 2 085 2 335 2 477 2 547
Oil and gas 1 871 1 459 1 755 2 050 2 163 2 422 2 698 2 747 2 742 2 642 2 772 2 796 3 033
1980 1985 1990 1995 2000 2005 2006 2007 2008 2009 2010 2011 2012
0
10
20
30
40
50
60
70
Loaded 34 60 6
Unloaded 41 57 2
Developed economies Developing economies Transition economies
F|g0re 1.3 (a). wor|d seaboroe trade, by co0otry gro0p, 2011 (Perceotage share |o wor|d toooage)
Source: Compiled by the UNCTAD secretariat on the basis of data supplied by reporting countries, and data obtained from the
relevant government, port industry and other specialist websites and sources. Figures are estimated based on preliminary
data or on the last year for which data were available.
RELATION URBAN-RURAL CIVILISATION
(Source: United Nations)
United Nations Department of Economic and Social Affairs/Population Division 3
World Urbanization Prospects: The 2009 Revision
Figure II. Urban and rural populations by development group, 1950-2050
0.0
1000.0
2000.0
3000.0
4000.0
5000.0
6000.0
1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050
Year
P
o
p
u
la
t
io
n
(
m
illio
n
s
)
More developed regions, urban population Less developed regions, urban population
More developed regions, rural population Less developed regions, rural population
TABLE 1. TOTAL, URBAN AND RURAL POPULATIONS BY DEVELOPMENT GROUP, SELECTED PERIODS, 1950-2050

Population (billion) Average annual rate of change (percentage)
Development group 1950 1975 2009 2025 2050 1950-1975 1975-2009 2009-2025 2025-2050
Total population
World.................................... 2.53 4.06 6.83 8.01 9.15 1.89 1.53 1.00 0.53
More developed regions.... 0.81 1.05 1.23 1.28 1.28 1.02 0.48 0.22 -0.01
Less developed regions..... 1.72 3.01 5.60 6.73 7.87 2.25 1.82 1.16 0.63
Urban population
World.................................... 0.73 1.51 3.42 4.54 6.29 2.91 2.40 1.76 1.31
More developed regions.... 0.43 0.70 0.92 1.01 1.10 1.97 0.82 0.58 0.33
Less developed regions..... 0.30 0.81 2.50 3.52 5.19 3.96 3.30 2.15 1.55
Rural population
World.................................... 1.80 2.55 3.41 3.48 2.86 1.39 0.85 0.12 -0.77
More developed regions.... 0.39 0.35 0.31 0.26 0.18 -0.39 -0.35 -1.01 -1.62
Less developed regions..... 1.41 2.20 3.10 3.21 2.69 1.77 1.01 0.22 -0.71
60,000
50,000
40,000
30,000
20,000
10,000
0
5
extreme precipitation (rain and snow) as well as
hurricane activity at the end of 2012 in the
New York/New Jersey Metropolitan area
demonstrate the economic and social
vulnerability of major urban areas. In other
regions extreme drought and the decrease of
river depths are causing problems for navigation
and capacity limitations for inland water
transportation of goods.
Climate changes which infuence urban
development will remain a strong driver for the
dredging industry.
ENERGY
Whilst the search for alternative fuel sources
continues, fossil fuels still dominate the global
energy arena. More and more of these
resources are being exploited offshore, often
in remote areas at great depths. Dredging is
therefore needed to prepare the seabed and dig
trenches for pipelines, and then protect these
pipelines by backflling with sand, gravel and rock.
This includes a strong increase in the demand for
liquefed natural gas (LNG), which
necessitates new port infrastructures, thus
generating a maritime infrastructure demand of
its own. On the sustainable side, more and more
wind farms are being placed at sea.
High fuel prices continue to encourage the
expansion of the energy supply, also from
non-conventional sources, for instance, the shale
revolution for gas and oil. From 2011 to 2030
production and demand for shale gas and oil are
expected to increase.
World primary energy consumption is projected to
grow by 1.6% p.a. from 2011 to 2030, adding 36%
to global consumption by 2030. The growth rate
however declines from 2.5% p.a. for 2000-10, to
2.1% p.a. for 2010-20, and 1.3% p.a. from 2020
to 2030 (BP Energy Outlook 2030, January 2013).
GLOBAL ENERGY CONSUMPTION 2000-2012 IN
MLN TONNES OIL EQUIVALENT
(Source: BP 2013)
0
2.000
4.000
6.000
8.000
10.000
12.000
14.000
2000 2005 2008 2009 2010 2011 2012
North America Latin America Europe Middle East Africa Asia
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
6
DREDGING IN FIGURES 2012
TOURISM AND LEISURE
After a sharp decrease in 2009, refecting the
economic downturn, international tourism showed
growth in 2010 and 2011. Estimated dredging
turnover in 2012 remained stable compared with
2011.
For the dredging industry the focus is
especially on the growth of water-related tourism
beaches, marinas and cruise terminals, water
theme parks and resorts. Dredging for recreation
and tourist attractions has often been a spin-off
of coastal defence activities such as beach
replenishments and urban developments.
The number of tourists is predicted to increase to
1.5 billion by 2020.
THE GROWTH OF DREDGING TURNOVER
The drivers of dredging have developed
favourably for more than a decade at a
moderate, but steady pace. This is true of the
dredging industry as well. This moderate,
favourable growth has depended on several
factors:
Technological innovation has led to improved
cost effciency and a wider range of projects:
The size and capacity of modern dredging
vessels has grown resulting in economies of
scale. The newest feets can dig to greater
depths and transport sand from remote borrow
areas at greater distances and faster speeds.
The dredging industry continues to invest in
the development of more fuel-effcient ships,
equipped with state-of-the-art technology and
high-tech systems. These advances make
complex projects more fnancially feasible.
Engineering and environmental R&D produced
by a highly skilled workforce has allowed the
industry to make a greater design contribution
to large-scale projects. Clients are benefting
from the early involvement of the major
dredging companies whose expertise has
created new markets and contributed to
sustainable solutions.
In addition, in 2012 the turnover in China rose
because of the change in the currency rates
of the renminbi (CN) toward the euro even
though the size of the dredging market has
remained similar to previous years.
INTERNATIONAL TOURIST ARRIVALS 2000-2012 IN MLN
(Source: UNWTO)
0
200
400
600
800
1.000
1.200
1990 1995 2000 2005 2010 2011 2012
Asia
Africa
Middle East
Europe
Latin America
North America
1,200
1,000
800
600
400
200
0
7
TURNOVER OF THE GLOBAL DREDGING
MARKET 2012
The estimated total turnover of global dredging
contractors private as well as state- or
port-owned companies is estimated at 11,370
mln for 2012
1
. The pie chart shows the
composition of this turnover for 2012 per driver.
From 2000 to the present, the global dredging
turnover has more than doubled. Not all regional
markets, however, have developed at the same
pace, as is illustrated in the fgure below.
The volume of dredging turnover closed to
international tenders is still substantial, with
China as number 1 and the USA as number 2. In
China, a few projects are open for international
tenders. The USA market is effectively closed to
foreign competition by the Jones Act, which
makes it impossible for non-USA owned and
controlled contractors to undertake dredging
activities. In India, state-owned
Dredging Company of India (DCI) has a preferred
position in public tendering, although upon
occasion foreign companies have been awarded
large dredging contracts. Globally, the market
share of these closed markets was 46% in 2012.
This is an increase of 3% compared with 2011.
As mentioned above, this increase resulted from
a change in exchange rates between the
renminbi and the euro.
When considering the entire dredging market, the
market share of IADC members (private
contractors) was 49% in 2012. This is a decrease
of 2% compared with 2011. When considering
only open markets with free access, IADC
members represented a total of 90% market
share in 2012, a clear increase since 2000
(2000 = 75%).
TURNOVER OF THE GLOBAL DREDGING MARKET 2012
(Source: IADC)
GEOGRAPHIC SPREAD OF TURNOVER
(Source: IADC)
41%
17%
5%
20%
13%
4%
Trade - capital dredging
Trade - maintenance
dredging
Coastal
Urban
Energy
Tourism/ Leisure
1
This fgure relates to underwater excavation, transportation
and placement of dredged material carried out in 2012.
It does not include maritime construction such as
breakwaters, offshore installations, harbour
infrastructure, dams, dikes and other infrastructure in which
dredging contractors are involved. However, within this
fgure, some 350 mln relate to rock works that are an
integrated part of land reclamations and coastal defence.
0
2.000
4.000
6.000
8.000
10.000
12.000
2000 2005 2006 2007 2008 2009 2010 2011 2012
i
n

m
i
o

India
Africa
China
Europe
Middle East
Others
12,000
10,000
8,000
6,000
4,000
2,000
0
8
DREDGING IN FIGURES 2012
DEFINITIONS AND METHODOLOGY
This review relates to the annual turnover estimated for
2012. Carried out in 2012 therefore does not
necessarily mean contract awarded in 2012, nor that
payment was received in 2012. It only refects work
that was actually performed in 2012. For projects only
partially performed in 2012 (e.g., a project started on
1-1-2011 and fnalised on 30-6-2012), the value of the
part actually executed in 2012 has been attributed.
Dredging projects in inland waterways as far as
known are included in the survey as well as stone
protection works for quay walls and coastal protection.
Also not included are stone dumping through fexible
fall pipe vessels (FFPV) vessels and
side-stone dumpers. Specifc land-based dry
engineering works are also excluded. Environmental
measures and remedial dredging, however, are
included.
TYPES OF PROJECTS
Trade:
harbour extensions (excluding offshore crude oil
terminals and LNG terminals [see Energy] and ex-
cluding marinas and cruise terminals [see Tourism])
navigation channels and turn basins
maintenance dredging
Coastal defence:
beach nourishment and replenishment
dike building/raising and food defence works
(excluding civil works)
coastal protection, river training and other shore
protection measures
Urban development:
land reclamation for, e.g.:
industrial infrastructure port, industrial, trade
and service, recreational, transport
infrastructure and for urban development
(coastal expansion)
trade and service infrastructure (trade fairs,
business parks, conference centres)
transport infrastructure (airports, roads, parking
facilities, rail projects)
residential real estate (housing driven by
demographic pressure)
dredging trenches for immersed tunnels, dams
outfalls and landfalls
marine storage basins for contaminated dredged
materials
Energy:
dredging for offshore crude oil terminals and LNG
terminals
trenching and backflling for sub-marine cables and
pipelines
(pre)dredging related to oil drilling facilities (e.g.,
platforms, glory holes)
other offshore installations (gravity-based structures
for wind farms)
Tourism:
land reclamation for recreation sites such as theme
parks, recreation piers/wharfs, shopping malls) and
marinas and cruise terminals, land reclamation for
hotels, holiday resorts
beach restoration and replenishment
METHODOLOGY
Dredging in Figures has been carefully compiled by
a Delphi survey amongst IADC members, analyses
of company reports and other (public) sources. All
information has been verifed to the best of our ability,
however, the IADC and its members cannot be held
responsible for any inaccuracies. The review does not
necessarily refect the opinions of individual IADC
members. Please contact the IADC if you wish to
reproduce any or all information in this review either
electronically and/or in any other form.
For further enquiries, please contact the IADC
Secretariat:
T +31(0)70 352 33 34
E info@iadc-dredging.com
W www.iadc-dredging.com
The International Association of Dredging Companies
(IADC) is the global umbrella organisation for
contractors in the private dredging industry. As such
the IADC is dedicated to promoting not only the skills,
integrity and reliability of its members, but also the
dredging industry in general. The information presented
here is part of an on-going effort to communicate with
clients, stakeholders and other concerned parties about
the fundamental importance of dredging and maritime
construction.
IADC SECRETARIAT Alexanderveld 84
.
2585 DB The Hague
.
The Netherlands
POSTAL ADDRESS PO Box 80521
.
2508 GM The Hague
.
The Netherlands
PHONE +31 (0)70 352 33 34 FAX +31 (0)70 351 26 54
E-MAIL info@iadc-dredging.com WEBSITE www.iadc-dredging.com