Voice of the Industry - SubTel Forum 9.pdfApr 01, 2004 · SubOptic 2004 and Submarine Telecoms...

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Voice of theVoice of theVoice of theVoice of theVoice of theIndustryIndustryIndustryIndustryIndustry

Issue 9July 2003

An international forum forthe expression of ideas andopinions pertaining to the

submarine telecoms industry

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Contents

Advertisers

Editor’s Exordium 3

SubOptic Survey 4

Emails to the Editor 5

NewsNow 6

Maintenance News 10

A Simple ViewJack Runfola 13

A Troubled ChapterChapter 11 leaves its mark Daniel J Carragher 15

Autonomous SubmarinesAlternatives for ROV and AUV operationsJules BenBenek 20

Telecom experts display market savvyEntrepreneurs founded fibre-optic company,sold to a US giant and recently bought it backAndy Riga 24

Breaking with ConventionA Different Way of Laying Submarine CablesMichael Jones 28

Dublin is Attached to BostonHibernia AtlanticAlasdair Wilkie 32

Tracking the Cableships 34

Letter to a FriendJean Devos 38

Upcoming Conferences 39

Great Eastern 5C&W GOES 6,7,8,9,12GMSL 10,11WFN Strategies 12CTC 19BJ Marketing Communications 22Fugro 23Thales Geosolutions 26Nexans 27Caldwell Marine 30OFS 31Lloyds Register 33STF Marketplace 36Parkburn PHS 37

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ExordiumExordiumExordiumExordiumExordiumSubmarine Telecoms Forum is published bi-monthly byWFN Strategies, L.L.C. The publication may not bereproduced or transmitted in any form, in whole or in part,without the permission of the publishers. Liability: whileevery care is taken in preparation of this publication, thepublishers cannot be held responsible for the accuracy ofthe information herein, or any errors which may occur inadvertising or editorial content, or any consequence arisingfrom any errors or omissions.

Submarine Telecoms Forum is an independentcommercial publication, serving as a freely accessible forumfor professionals in industries connected with submarineoptical fibre technologies and techniques. The publishercannot be held responsible for any views expressed bycontributors, and the editor reserves the right to edit anyadvertising or editorial material submitted for publication.© WFN Strategies L.L.C., 2003

Contributions are welcomed. Please forward to theManaging Editor: Wayne F. Nielsen, WFN Strategies,19471 Youngs Cliff Road, Suite 100, Potomac Falls,Virginia 20165, USA.Tel: +[1] 703 444-2527, Fax:+[1] 703 444-3047.Email: [email protected]

Advertising - Europe/ME/Africa - Hildegard PeltierTel: +[33] 1 4785 2207Email: [email protected]

Advertising - Houston USA, Robin GentryTel: +[1] 281 895 6880Email: [email protected]

Designed and produced by Ted BreezeBJ Marketing Communications, Colchester, UK(44) 01206 230472

Welcome to the 9th issue of SubTel Forum!

In a recent sailing trip on the Chesapeake Bay, I had the

opportunity to clear my head, take in the sights, and ponder an

ever-increasingly interesting future. On this particular exploit I

had the opportunity to sail among other places, to Tangier Island in

the middle of the bay, which was discovered by John Smith of

Pocahontas fame around 1610, and settled some thirty years later by

the extended Crocket family.

And a thought came to me - about the longevity of our industry -

about hundreds of individuals that have indeed served the industry

through the years - about the corporate pillars of our community

that despite name changes or logo redraws, have withstood the test

of time - and on that old-world island in the middle of the bay I

found solace and new insight.

This issue brings what we hope to be new insight to you our readers,

and we have we have included again a one-page industry survey

cosponsored by SubOptic 2004, which we hope more will take the time

to complete and forward, the results of which will be

shared in an upcoming issue of STF.

Wishing you fair winds.

Wayne.

mailto:[email protected]



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SubOptic 2004 and Submarine Telecoms Forummagazine are co-sponsoring the first annual SubmarineTelecoms Industry Survey, the results of which will beshared online and published in an upcoming issue.

One lucky responder will receive a free copy of the 2002edition of Undersea Fiber Communication Systems,which was edited by Jose Chesnoy, Head of SystemDesign & Technology, Alcatel Optics Group, France.

Please take a moment to respond by printing this pageand mailing or faxing to:

WFN Strategies19471 Youngs Cliff Road, Suite 100Potomac Falls, Virginia 20165 USAFax [1] 703 444 3047

1. Which best describes you?

AcademicEngineer/Project ManagementManagementMarketingOther

2. What best describes your business?

Cable ownerSystem IntegratorCable Installer/MaintainerMarine SurveyorOther

3. Which Keynote Speaker would attract you toattend SubOptic 2004?

___________________________________________

___________________________________________

4. What would you find the most stimulating andrelevant topic for a SubOptic Roundtable?

___________________________________________

___________________________________________

5. Are you planning to attend SubOptic 2004?Yes No

6. Are business conditions improving or gettingworse?

Improving Worse

7. Are you optimistic or pessimistic about the future?Optimistic OtherPessimistic

8. Does your current business performance indicatethat we are still in a recession, or has yourbusiness not been affected?

___________________________________________

___________________________________________

9. How have client requirements changed over thelast three years?

___________________________________________

___________________________________________

___________________________________________

10. How has the type of project you handle changedover the last three years?

___________________________________________

___________________________________________

___________________________________________

11. How would you rate the content of SubmarineTelecoms Forum magazine

Excellent UnsatisfactoryGood PoorSatisfactory

12. How would you rate the content of News-Nowand the STF website?

Excellent UnsatisfactoryGood PoorSatisfactory

13. Would you like to see any changes in STF orNewsNow, or other website information services?

___________________________________________

___________________________________________

14. In your opinion, what does the industry most need?

___________________________________________

___________________________________________

Name___________________________________________

Company_________________________________________

Address_________________________________________

City_______________________________________________

State/Province ______________________________

Country_________________________________________

Telephone_________________________________________

Email____________________________________________

Submarine Telecoms Industry Survey

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Read your latest edition,

packed with great stuff as

usual.

Les Valentine, Nexans

Very good website - most

informative.

Sonya Comstock, KDDI-SCSAmerica, Inc.

Thanks - and keep up the

good work

Peter Phibbs

Congratulations on your

paper I enjoy it immensely;

obviously a daily paper

would be great but hey is

there enough news!

Mike Wiseman, Esq.

Emails tothe Editor

....................................

....................................

....................................

http://www.greateasterngroup.com

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A brief synopsis of current news itemsfrom NewsNow, the weekly news feedavailable on the Submarine TelecomsForum website.

From business case to operation, from satellite networks to submarine, from Alaska to Bahrain to New Zealand

Alaska Cable Contract AwardedGeneral Communication, Inc. (GCI) officials haveannounced the building of a $50 million fiber opticcable connecting Seward, Alaska and Warrenton,Oregon.

www.subtelforum.com/NewsNow/6_july_2003.htm

Asia Netcom Unveils IP VPN SolutionsAsia Netcom has announced key enhancementsto its IP VPN (Internet Protocol Virtual Private Net-work) solution for enterprise customers. For thefirst time, businesses in Asia Pacific will be offeredfive classes of service (CoS) combined with theoption for usage-based pricing.

www.subtelforum.com/NewsNow/22_june_2003.htm

Broadwing Sale ClosesCorvis Corporation and Cequel III, announced thattheir joint venture, C III Communications, LLC, hasclosed on the purchase of Broadwing Communica-tions, subject to regulatory requirements.


BT Adds MPLS Nodes in USBT announced its strategy to expand its commitmentto US corporations. An extended IP infrastructure,owned by BT, will support a more comprehensive suiteof ICT and telecoms services, enabling US multi-sitecorporations to be more competitive internationally.

www.subtelforum.com/NewsNow/18_may_2003.htm

C2C Woes ContinueSingapore Telecommunications Ltd. (SingTel) hascancelled a loan commitment to unit C2C Pte Ltd.,which operates a US$2.0 billion, 17,000-km cablenetwork linking seven countries across Asia.


Cable to Tasmania CompletedThe 240-kilometer installation of submarine opticalfiber cable across Bass Strait commenced fromGodfreys Beach at Stanley, Tasmania on 4 May2003 and was completed at Inverloch, Victoria, on23 May 2003.


http://www.subtelforum.com/NewsNow/6_july_2003.htm

http://www.subtelforum.com/NewsNow/22_june_2003.htm


http://www.subtelforum.com/NewsNow/18_may_2003.htm



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Not everyone has our depth of experience or breadth of capability - but now everyone can profit from it

Realise your business vision with Cable & Wireless www.cw.com/goes

C&W to Exit USCable & Wireless (C&W) has announced a majorrefocusing of its group operations.


Carrier Doubles Capacity at NAPTerremark Worldwide, Inc. has announced thatEPIK Communications, Inc., has doubled its pres-ence in the NAP of the Americas.


FLAG Expands in EuropeFLAG announced that it will enhance its Europeannetwork through an agreement with Verizon.


FLAG Telecom Files ReportsFLAG Telecom has announced that it has filed allreports required by Section 12 of the SecuritiesExchange Act of 1934 subsequent to the compa-ny’s emergence from protection under Chapter 11October 9, 2002.


Global Crossing/STT Deal Gets TimeThe U.S. Bankruptcy Court has ruled in favor ofkey Global Crossing motions to amend its purchaseagreement with ST Telemedia (STT), and extendits exclusivity.


Global Crossing Monthly Report ReleasedGlobal Crossing has filed a Monthly Operating Re-port (MOR) with the U.S. Bankruptcy Court, as re-quired by its Chapter 11 reorganization. Results re-ported in the May 2003 MOR are unaudited.


Gulf of Mexico System Signs Customer Gulf Fiber Corporation has announced that BP hascontracted with the company for fiber optic com-munications services to several of its new deepwaterdevelopments in the Gulf of Mexico.


IT International Telecom Wins ContractIT International Telecom announced that it has beenawarded a contract to supply a non-repeatered sys-tem between the Gaspé and the Îles de la Madeleinein Quebec, Canada.










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From business case to operation, from satellite networks to submarine, from Alaska to Bahrain to New Zealand

Indian Carrier Announces Services on i2iBharti announced the launch of international dataservices using the Network i2i submarine cable.


International Telecom Group Unit SoldThe office of the International Telecom Group inToms River, New Jersey, has been sold. The newcompany is named Caldwell Marine International.


Level 3 Raises $325 MillionLevel 3 Communications, Inc. has announced thatit has priced the offering of $325 million aggregate

principal amount of its 2.875% Convertible SeniorNotes due 2010 in an underwritten public offering.


MFN Closer to Emerging from Chapter 11Metromedia Fiber Network, Inc. (MFN) has filed itsDisclosure Statement in the United States Bank-ruptcy Court. This follows MFN’s submission of itsPlan of Reorganization and moves the companyfurther in the process to emerge from Chapter 11.


New Bid for Global CrossingXO Communications, Inc. has announced an offerto acquire all assets of Global Crossing Ltd. and

Global Crossing Holdings Ltd for over $700 million,increasing proceeds available to Global Crossingcreditors by over $100 million versus the currentbid by Singapore Technologies Telemedia Pte Ltd.


New Scandinavian PoPs for T-SystemsDeutsche Telekom’s T-Systems International Car-rier Sales & Solutions (ICSS) has announced a newLocal Business Unit for ICSS in Denmark as wellas Points of Presence (PoPs) in Copenhagen andOslo. The new PoPs ensure reliable and high-qualitytransmission of voice and data, via T-Systems’worldwide backbone, the Telekom Global Net.


Parkburn Consolidates BrandsParkburn Precision Handling Systems Limited (P-PHS) is a new name, but a very experienced playerwhich now encompasses the traditional 30 year







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Not everyone has our depth of experience or breadth of capability - but now everyone can profit from it

Realise your business vision with Cable & Wireless www.cw.com/goes

class heritage of the Dowty brand naval and com-mercial handling systems as well as the recentlyacquired company IPR and service rights of Ma-rine Projects Developments Limited.


Sale of Pacific Crossing Ltd. ApprovedPivotal Private Equity has announced that the U.S.Bankruptcy Court has approved the sale of PacificCrossing Ltd. and its subsidiaries (PCL) to PivotalTelecom LLC, for $63 million. Judge Peter J. Walshhas signed the sale order that approves PivotalTelecom as the buyer.


Teleglobe Acquisition CompletedThe purchase of the core voice, data, Internet andmobile roaming businesses of Teleglobe, Inc. byTeleglobe International Holdings Ltd. has been com-pleted.


VSNL Launches Units in the US, SriLankaVidesh Sanchar Nigam Limited (VSNL) has an-nounced the formation of VSNL America Inc., awholly owned subsidiary in the United States.


WFN Strategies Establishes ASEANStrategic Partnership

WFN Strategies of the USA and Thag Sdn. Bhd. ofMalaysia recently announced the establishment ofa strategic partnership to promote areas of mutualinterest in Malaysia and North America.


XO Communications Ups Bid for GlobalCrossing

On May 30 billionaire investor Carl Icahn, who con-trols more than 80 percent of XO CommunicationsInc., a regional phone company, offered more than$700 million for bankrupt long-distance carrier Glo-bal Crossing, or $250 million in cash and the rest indebt, stock and warrants.








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MAINTENANCE NEWSMAINTENANCE NEWSCTC Marine Achieves ISO 9001:2000AccreditationAs a result of their drive to meet and exceedthe needs of customers, CTC Marine Projectshas successfully achieved ISO 9001:2000 ac-creditation.


Cable Maintenance Contract forHibernia AwardedThe cable maintenance contract for the HiberniaAtlantic cable system, which stretches fromDublin to Canada, to Liverpool via Boston andback to Dublin again, has been awarded to Glo-bal Marine Systems Limited.


Carriers Upgrade Malaysia-JapanBackbone

Internet Initiative Japan (IIJ) has announced thatits 26.7% affiliate Asia Internet Holding Co., Ltd.(AIH) has reached an agreement with TMNetSdn Bhd to upgrade TMNet’s A-Bone connec-tivity between Malaysia and Japan to 300 Mbpsfrom 45 Mbps.


Cables Damaged by EarthquakeAt least three cable ships are en route to Alge-ria to repair submarine cables damaged by adevastating earthquake on Wednesday.


Deep Water Cable Repair Record forAlcatelAlcatel has successfully completed a fiber op-tic cable repair in depths close to 9400 meters— breaking the world record for deep-sea ca-ble repair operations.


FT, TM to Share Capacity Some AsianCapacityFrance Telecom and Telekom Malaysia have anagreement on sharing some of their Asian ca-pacity.








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MAINTENANCE NEWSMAINTENANCE NEWS

FiberNet Provides Wavelengths for FLAGTelecomFiberNet Telecom Group, Inc. has signed a 15-year agreement with FLAG Telecom NetworkUSA Limited, for transport services within theNew York City metropolitan area.


Hibernia Atlantic UpdateHibernia Atlantic has opened its dedicatedsuperhighway from Ireland to New York andBoston – the only direct transatlantic subma-rine cable network linking Ireland to the UnitedStates.


Global Marine, BP Sign AgreementBP Exploration Company Ltd (BP) has signeda submarine cable maintenance agreement withGlobal Marine.


Interoute Restores OTE Traffic Lost toEarthquakeAs reported earlier, a recent Algerian earth-quake damaged FLAG and SEA-ME-WE-3.


New Services Tested over MedNautilusNetworkPacketLight Networks, announced that it hassuccessfully completed a trial to transport

multiple services — TDM and Gigabit Ethernetover 10Gbps/STM-64 links — on MedNautilusterrestrial fiber network.


Network Renews ContractTeliaSonera International Carrier (TS IC) hasannounced that DANTE renewed its contractto buy IP transit for the pan-European gigabitresearch network GEANT.


SEA-ME-WE-3 Repairs CompletedThe SEA-ME-WE-3 cable, damaged last monthin the Algerian earthquake, has been repaired.









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WFN Strategies assists clients involvedin a variety of activities from businessdevelopment, marketing & salesplanning/implementation to installationsupport, submarine cable provision,system design, system or productprocurement, system engineering andinvestment services. One of our key strengths is the ability tohelp you re-evaluate your products orservices for alternate markets and futuremarket positioning.

Our corporate mission is simple: To assistcustomers by increasing their profitability,corporate and stockholder value

WFN Strategies, LLC19471 Youngs Cliff RdSuite 100Potomac Falls,Virginia 20165 USA

Tel: +1 (703) 444-2527Fax: +1 (703) [email protected]

wfnstrategies

From business case

to operation

From satellite networks to

submarine

From Alaska to Bahrain

to New Zealand

Not everyone has our

depth of experience or

breadth of capability -

but now everyone can

profit from it

Realise your business vision

with Cable & Wireless

www.cw.com/goes

http://www.wfnstrategies.com

http://www.cw.com/goes

http://www.wfnstrategies.com

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To add my thoughts to others, these last fewyears in the submarine system market havebeen pretty bad. Actually, it has been damnugly. Many new entrants have disappeared,which is old news, as well as some old-linecompanies who have been forced intofinancial positions one would never haveimagined. Unfortunately, this is still an on-going event.

So, what does it all mean?Business is bad and hundreds of thousands

of people are out of work worldwide. Not good.Or is there some good, albeit limited, after all?

Each of us has our own opinion, and myopinion is straightforward. The telecomsindustry has made the same overbuild mistakesas the oil companies in the 1980’s, as well as steel,automotive, defense and many other industries.No one ever seems to plan for a bust. But sureenough, a downturn always occurs. This is theforce of nature, market nature, and as an oldAmerican television commercial said, “You don’tfool with Mother Nature.”

Well we did, and some gained financially inthe short term, while the consumer gained fromnew technologies and better pricing for services.

I have long felt that the long haul marketwas slightly overrated. Building to span andconnect the continents so that Internet, data andvoice may be exchanged, to where redundancyalready existed, and to where one is not sure whyit needed to be there in the first place, seemedto be the goal. What a goal!

Frankly, I have never heard an analyst say,“We got it wrong”. Maybe they have, but I wasn’tthere to hear it. The objective being achieved,the consumer benefited from lower prices whileincreasing instability. Like Lady Justice, theconsumer and supplier were blind.

Not all efforts end in failure, or Chapter11. Apollo, Southern Cross, Australia Japan,Japan-US, and many other systems havesurvived. Why? Simply put, these systems werebacked and utilized by major carriers andoperators who already had a customer base. Nodoubt each of these systems have had to facethe impact of the downturn, but they are stillactive and very much alive. What I findinteresting is that they are able to maintain theirrespective operations without having the benefitof court approved restructure, which allows debtto be made just about non-existent. Looks likethese systems, as an example, have some prettygood management and teamwork. To me, thislittle fact is very impressive.

The telephone industry is prettyuncomplicated to describe, albeit complex torun. A carrier/operator collects revenue all week

A Simple A Simple A Simple A Simple A Simple VVVVVieieieieiewwwww

by JACK RUNFOLA

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and the puts money in the bank on Friday. Thenon Monday, it begins to look at spending. Atelephone or communications system is like aliving creature – it takes food to fuel its activity.That fuel is consumer need and revenue. To meetneed, an operator must repair, replace, keep upwith technology changes, and expand as needed.That is and will be the nature of its existence.That is where revenue and profit are needed.When cost exceeds the selling price even afterall cost factors have been brutalized, then lowprices are not beneficial.

This is also the nature of the operatorproblem. Over the last several years, we theconsumer, have benefited from lower prices.Without the new entrants, it is hard to believethat the old-line operators would have loweredtheir prices for the good of the consumer. So,once again, competition showed itself to be goodto a point.

The point where competition is not so goodis when prices become so low that companiescannot afford to stay in business. Whencompanies go out of business it is mostly due toover extended loans and questionablemanagement decisions and a whole host ofsimple problems from political to practical.However, based on some recent CEO packagesfailure pays well! No company, no investor, noeconomy, no country ever gains where there ishigh unemployment. Everyone loses. In otherwords, prices may need to go back up, as too

much capability and talent have been lost whichreflects on stability.

The word “rationalization” has been useda lot in our industry. My dictionary poses twointeresting definitions:

1. (Psychiatry) a defense mechanism bywhich your true motivation is concealed by explainingyour actions and feelings in a way that is notthreatening.

2. The cognitive process of makingsomething seem consistent with or based on reason.

While neither meaning seems appropriate,I think we are all trying to create a process ofapplying reason, experience and action in athoughtful manner so it may create stability.

The phrase, “What makes good businesssense” has also been used, which, it seems, isusually said when no one can come up with agood idea.

The long haul market has been thedominant feature of our market. As such, duringits reign of dominance, it forced the short haulmarket to be gravely overlooked. When thisoccurred, it started to turn the blood off fromthe brain. Only by local operator and businessneed can you expand connectivity.

The market and ensuing opportunities arecoming back, and this time major projects arenot the leader. Short haul systems for telecom,science and offshore petrol-chemicalcommunication needs are advancing. It seemsthat need is being regenerated and although this

will not put an abundance of people back towork, it can be a humble start.

Hopefully, if there is a next time ofsubstantial market growth, we will be better atour decisions in making it a stable andsustained growth. Hopefully.

Jack Runfola has spent over 25 years in seniormanagement positions primarily in businessdevelopment, submarine fiber optic cablemanufacturing and project management intelecom, offshore petrochemical and defenseindustries. Among his accomplishments, hewas involved in building the world’s largestprivately owned optical festoon system. Herecently became associated with WFN Strat-egies as Senior Consultant.

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The depressed state of the undersea cableindustry has lead to multiple filings under theU.S. bankruptcy laws by companies caughttrying to build out or pay for their networksat the time that pricing and demand for theirsystems plummeted. The favorable U.S.reorganization laws have been used inconjunction with multinationalinsolvency proceedings, as Chapter 11gives companies a unique opportunityto retain control of their business andattempt to reorganize. Chapter 11 alsoallows the companies to eliminatemountains of debt and emergeunencumbered by the crushing debt thatbrought them into bankruptcy. Thesurviving owners, or distressed asset buyers,then have a competitive advantage in themarketplace.

The public nature of the proceedings allows

for the review of detailed financial informationabout the companies, the deals they cut withtheir creditors and the infighting between andamong competitors, owners and creditors. This

article will provide some of the details of threesuch proceedings, FLAG Telecom, Asia Global

Crossing and Pacific Crossing, all of whichbegan in 2002 and all of which have eitherbeen confirmed or resulted in sales ofsubstantially all assets.

FLAG TelecomFLAG Telecom was a Bermuda company

that acted as the holding company forabout 50 corporate entities operating a

global telecommunications network servingthe international wholesale broadband

market. Its owned undersea cable networkincluded FLAG Europe-Asia (FEA) Network, FLAGAtlantic-1 (FA-1) Network and FLAG North AsianLoop (FNAL) Network. In addition, FLAG had

A TROUBLED CHAPTERA TROUBLED CHAPTERA TROUBLED CHAPTERA TROUBLED CHAPTERA TROUBLED CHAPTERChapter 11 Leaves its Mark on the Submarine Telecom Industry by Daniel J Carragher

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terrestrial networks and had acquired terrestrialbackbone capacity across the U.S. and trans-Pacific undersea capacity.

FLAG Telecom, the holding company,raised over $633 million in its IPO in February2000, and in the ensuing months raised over$576 million in additional funds from the saleof bonds in the United States and Europe. FLAGLimited then issued another $430 million ofbonds. In addition, a banking syndicateprovided a $575 million construction line toFLAG Atlantic, of which $286 million was drawnbefore the bank group terminated itscommitments in 2001. Even higher credit lineswere extended to the FLAG companies, but hardtimes hit before FLAG could use them.

On April 21, 2002, the FLAG companiesfiled U.S. Chapter 11 proceeding in the SouthernDistrict of New York. FLAG simultaneously filedthe necessary documents pursuant to Section 161of the Companies Act 1981 of Bermuda in orderto commence proceedings in the Supreme Courtof Bermuda for the appointment of JointProvisional Liquidators. At the time of thebankruptcy filing, FLAG had consolidated assetsof $3.3 billion and consolidated debts of $2.6billion. The filing was triggered by thedeclaration of a default the day before on theFLAG Atlantic bank credit line and the seizureof funds in certain European bank accounts.FLAG immediately moved $210 million out ofthe other banks in the FLAG Atlantic syndicate

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to FLAG Pacific accounts and filed bankruptcythe next day to prevent any more seizures. Oncethe Bankruptcy Code’s automatic stay was inplace, the funds were returned.

FLAG’s goal in the Chapter 11 case was tokeep the company intact, restructure its balancesheet and emerge from Chapter 11 as quickly aspossible to avoid interference with customerrelationships. It achieved that result when itobtained confirmation of its reorganization planon October 9, 2002 less than six months afterthe companies filed.

Under FLAG’s complex debt restructuringplan, ownership of the holding company wastransferred to various creditor groups. Asubstantial portion of the companies’ cashreserves were used to partially satisfy the holdingcompany bond debt.

The creditor groups received all of the stockof the reorganized company, and preexistingstock holdings were canceled. The estimatedvalue of the stockholders equity distributed tocreditors upon emergence was $272 million.

The equity was distributed to FLAG Limitedbondholders (62.8%), the FLAG Atlantic banks(26.25%), the holding company bondholders(5%), and individual creditors (Alcatel (4.38%)and CIENA (1.58%)). The reorganized companyhad only $71 million in financial debt uponemergence (some of which can be prepaid at adiscount) as opposed to the $1.23 billion inexistence at the time of filing.

The effect of the reorganization was thecreation of a solvent company with a healthybalance sheet. The company has recently filedits overdue Form 10-K and 10-Q reports with theSEC and hopes to have its stock re-listed on theNASDAQ later in the year.

Asia Global CrossingAsia Global Crossing did not reorganize inChapter 11. Instead, it filed for relief inNovember 2002 as the last step in its plan to selloff its assets.

Asia Global Crossing was formed as a jointventure company between Global Crossing,Softbank Corp. and Microsoft Corporation inNovember 1999. The respective ownershipshares were: Global Crossing (58.9%), SoftbankCorp. (14.6%) and Microsoft Corporation(14.7%), with the balance of the stock held bythe public. Its stock was traded on the New YorkStock Exchange but was de-listed on February28, 2002, a month after Global Crossing filedfor Chapter 11.

Asia Global Crossing owned the East AsiaCrossing (EAC) subsea cable system and, throughPacific Crossing Ltd., an 84.5% controllinginterest in the Pacific Crossing (PC-1) system. Itsnetworks connected Japan, Hong Kong, Taiwan,South Korea, the Philippines and Singapore toeach other and to the United States.

To finance construction of EAC, Asia GlobalCrossing placed $408 million of Senior Notes in

October 2000. When Global Crossing withdrewits $400 million in standby credit support to AsiaGlobal Crossing in December 2001, Asia GlobalCrossing went into restructuring mode. InFebruary 2002, it engaged Lazard Frères torestructure the obligations under the SeniorNotes and to pursue a sale of the company.Lazard solicited buyers for the company andpursued some 30 strategic and financial buyers.The sale process culminated in November 2002in an offer from Asia Netcom, a Bermudainvestment vehicle formed by China NetcomCorporation (Hong Kong) Limited, a member ofthe China Netcom group, one of two wirelineoperators in China.

To accomplish the sale to Asia Netcom, AsiaGlobal Crossing and its U.S. operating subsidiary,Asia Global Crossing Development, filed forChapter 11 protection in the Southern Districtof New York on November 17, 2002.Concurrently, Asia Global Crossing Limitedpetitioned the Bermuda Supreme Court for theappointment of provisional liquidators andcommenced a winding-up proceeding underBermudian law.

The sale to Asia Netcom provided $81.2million in cash to Asia Global Crossing’screditors.

The buyer agreed to honor prepaid capacityagreements on the EAC network valued between$277 million (at estimated cost to perform) and$1.1 billion (at gross dollar amount of capacity

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purchased by customers). Outstandingconstruction obligations of $280 million to NECand KDDI were settled in connection with thesale. A Chapter 7 trustee will handle thjedistribution of the $81 million sales proceeds,as the creditors and the company could not reachagreement on how to handle the funds. Needlessto say, bondholders will receive a fraction of theirdebts, and the interests of shareholders werecompletely extinguished.

Pacific CrossingPacific Crossing took another route throughChapter 11. Pacific Crossing owned PacificCrossing-1 (PC-1), one of only two trans-Pacificfiber optic cable systems with available capacitylinking Japan and the US. The total cost of thePC-1 project was $1.35 billion, and most of thecost was financed.

Pacific Crossing was owned 84.5 % by AsiaGlobal Crossing and 15.5% by Vectant Inc.Pacific Crossing sold capacity to Global Crossingand Asia Global Crossing, which in turn resoldit to end users under long term contracts. ThePC-1 system was operated and maintained underturnkey contracts with Global Crossing affiliatesand their subcontractors, so Pacific Crossing hadno employees of its own. Global Crossing, whichfiled for Chapter 11 protection in January 2002,stopped providing many of the services, andPacific Crossing transitioned those to Asia GlobalCrossing and others.

In May 2002, prior to filing Chapter 11,Pacific Crossing engaged investment bankers tosell the PC-1 system. At the request of the bankgroup, an independent crisis management firmwas brought in to run the company. Theinvestment bankers contacted 30 potentialstrategic buyers and 23 potential financialbuyers.

The Pacific Crossing companies filed forChapter 11 protection on July 19, 2002 in theDistrict of Delaware with no buyer identified.As of the petition date, Pacific Crossing owed atleast $716 million to its bank group. The saleprocess continued during the bankruptcy case,but only four parties, including two who wereacting jointly, submitted indications of interestby the September 20, 2002 deadline.Negotiations with buyers continued until earlyJanuary 2003 at which time a lead bidder wasselected, but it then withdrew its offer. Furthernegotiations transpired until finally, in early May2003, Pacific Crossing sought permission to sellthe PC-1 system to Pivotal Telecom LLC, aPhoenix buyout firm, free and clear of liens,claims and encumbrances, for $63 million. Thesale was finally approved on June 3, 2003 and isexpected to close by November followingregulatory approvals.

Differences and Common ThreadsThe three cases demonstrate the wide variancein outcomes and uses of the Chapter 11 process.

FLAG initially used Chapter 11 defensively whenits banks precipitated a crisis by starting to seizeassets.

However, FLAG then accomplished acomplete restructuring in the Chapter 11 caseand emerged with its assets and businesses intact.

Asia Global Crossing used the process in amore typical fashion in the current environment.It held off its creditors while it shopped thebusiness and then filed Chapter 11 to seekapproval of the sale. Rather than having to seekapproval for the transaction from publicshareholders who were getting no benefit from

Dan Carragher is a partnerin the Boston office of thelaw firm of Day, Berry &Howard LLP. He is a mem-ber of the American Bank-ruptcy Institute and is a fel-low of the American Collegeof Investment Counsel. Heis Board Certified in Business Bankruptcy bythe American Board of Certification and is agraduate of Dartmouth College and BostonUniversity School of Law.

Day Berry & Howard has representeddebtors, creditors, equipment lessors, and sup-pliers in several Chapter 11 cases in thetelecom and broadband sector, includingTeleglobe, 360 Networks, PSINet and others.

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the sale, the company was able to obtainexpedited bankruptcy court approval of the saleprocess and the ultimate sale to the buyer. Thebuyer of the EAC assets from Asia Global Crossingwas a strategic buyer that has now acquired theassets at a favorable price.

Pacific Crossing filed before it hadidentified a buyer and was racing the clock tosee if it could complete a sale before it ran out ofcash and had to shut down PC-1.

The sale to a financial buyer is also typicalof many Chapter 11 cases in thetelecommunications area where low prices haveattracted private equity buyers who hope tostabilize or improve the businesses beforereselling them to strategic buyers.

These cases, along with many others bycarriers and system owners, reflect the extremedecline in value and marketability of subsea cablesystems in recent years. The sale of PC-1 for lessthan five percent of its cost is dramatic evidenceof the decline in values.

These cases also illustrate the simultaneoususe of U.S. and foreign bankruptcy laws, withthe U.S. proceedings taking the dominant role.Chapter 11 generally allows management toremain in control of the company and is thepreferred vehicle for restructuring ailingbusinesses. In a global industry liketelecommunications, we are likely to seethis pattern repeated in the future.

http://www.ctcmarine.com

20

Offshore marine industries, including bothcommercial and research disciplines, have re-ceived many advances in marine equipmenttechnologies from the world’s navies. Themilitary, making significant strides in all ar-eas of intervention, inspection and surveys,have provided a steady stream of advances tothe non-military arena from the earliest daysof marine exploration to the present dayscene.

Technologies such as Side Scan Sonar, ROV,AUV and Manned Submersibles can all be tracedback to naval development roots. Perhaps themost significant contribution in recent years isthe Autonomous Submarine. Submarines startedtheir practical development over 100 years ago.In that time they have provided naval organiza-tions with practical and safe means to conductsubmerged operations independent of surfacesupport. Utilizing nuclear or diesel engines,submarines have been responsible for cable, pipe-line and other submerged structure inspections,hydrographic surveys, marine research, new sys-tem testing, in addition to their security andoffensive capabilities.

Manned Submersibles represent a dilutedform of the autonomous submarine technology.During the 1980s, Manned Submersible useweaned, giving way to emerging ROV technolo-gies. Although the two share similar support shipneeds and sea state limitations, ROVs ultimatelycost less to operate.

RS Submarine SafetyDuring the past 10 years ABS and GL have for-mulated classification rules for engineering, con-struction and maintenance of MannedSubmersibles used in the growing tourist sector.This has created a segment, which over time hasproven to be among the safest in the marinevessel industry. To date, over 20 million individu-als have boarded tourist submersibles ranging insize from 10 to 60 passengers without incident.The RS Submarines were designed, built and aremaintained to these proven and safe industrystandards. Due to their classification and com-pliancy to SOLAS standards, many worldwideunderwriters economically and competitivelyinsure The RS Submarines.

Autonomous SubmarinesAutonomous SubmarinesAutonomous SubmarinesAutonomous SubmarinesAutonomous SubmarinesAlternatives for ROV and AUV operations

By Jules E. BenBenek PhD

The RS Series Autonomous Inspection andResearch Submarine is the first of a line of sub-marines that is now available outside of the mili-tary arena. Used extensively for over 12 years,the 50-foot RS Submarine has proven to be a safe,practical and cost efficient sub-sea platform.Eliminating the need for weather sensitive de-ployment support ships, the RS Submarine canoperate in sea states that would otherwise causedelays in projects utilizing ROV or AUV plat-forms. Total operating costs are calculated with-out such support and represent an overall sav-ings approaching 30%, when compared to mid-column working class ROV operations with sur-face support requirements.

21

Practical ApplicationsThe RS Submarines open new doors for the re-searcher and offshore commercial engineer alike.Operations are no longer restricted to a small areaon the sea floor per dive session. Up to 6 passen-gers can be transported to several dive locationsin any given day, spending more quality timeengaged in work. Sea State is much less of a fac-tor and price is significantly reduced by the elimi-nation of the costly deployment ship. Tasks andphenomenon can be viewed in real time, whererapid judgment and assessment can be made.

Operations such as pipeline and cableinspections can be performed simultaneouslywith the installation, allowing for corrections tobe advised before problems escalate or perhapseven begins. Engineers can efficiently conductcable suspension assessment and interventionover large areas. The RS Submarine can provideassistance to ROV, Hard Suit and CommercialDiving operations as well. An engineer, who must

otherwise wait for the description of the sub-merged project’s status, can now inspect as thediver works. The generous energy budget of theRS Submarine allows for a variety of hydraulictools to be used, as in Working Class ROV appli-cations. Hard Suit operators can be transportedfrom one dive site to another without the needto surface and benefit by having an engineer orgroup of peers in close proximity to assist indocumentation or intervention.

Qualified individuals at the target scene canassess projects that are sensitive to marinearcheological, environmental and biological is-sues. Cable and pipeline lays, to name a few, areoften hampered by lengthily environmental con-cerns, and often are challenged or litigated incourt. Expert testimony is more acceptable insuch cases when real-life evidence is presented,as opposed to remotely acquired data or thirdparty interpretations. Proof of the existence, oras important, proof of the absence of certainmarine life, can be more accurately determinedby the professional at the dive location, and thereports and testimony generated by this ap-proach are logically given more weight.

Hydrographic surveys are carried out muchin the same manor as in AUV operations, withthe exception of human control and decision-making being present at all times. Unliketraditional tow fish operations, the side scan ormulti beam system is attached to the hull andoperated by skilled technicians onboard the sub-

marine. Data is acquired and processed in realtime. The RS Submarine can suspend thehydrographic survey temporarily to visuallyinspect anolomies, eliminating the need to re-turn with an ROV to accomplish the same taskat some future point. The result is a completedsurvey with anomalies accurately documented.As with other RS operations mentioned, Sea Stateis much less a concern and delays caused by foulweather reduced, further saving time and money.

The RS Submarine is an ideal platform fornaval and security operations. ASW and newsystem testing can be performed for a fractionof the cost normally allocated to such tasks. TheRS Submarine has 8000kg of reserve buoyancyand therefore is capable of carrying a myriad ofbolt-on or internal ancillary equipment.

Hydraulics as well as various voltagesupplies and computer interface protocols areavailable for a broad range of applications.

22

RS Submarine OperationsIn normal operations, the RS Submarine is de-ployed with all hands, including technicians,engineers and researchers from the pier, and

arrives at the dive site utilizing independent andreliable diesel power. The vessel’s 400 NauticalMile range can be further increased by at-searefueling if needed.

The Submarines are fitted with a snorkelInduction System, which is designed to allow thesubmarines to transit submerged during roughweather condition, while still capitalizing on thediesel power plant’s range. The Snorkel alsoproves as an effective stealth component forASW, coastal and harbor security missions.

The RS Submarines are equipped with a fullgalley, including refrigeration, stove, sink and amicrowave. A sleeping compartment, head anden-route entertainment provide both comfortand livability to the crew on long missions.

The RS-1 and RS-2 are fitted with both bowand stern thrusters, allowing the vessels tomaneuver in their own diameter. Vertical stationkeeping thrusters, normally recessed in the sail,are hydraulically deployed when accurate alti-tude positioning is required.

A large, 1.1-meter hemispherical view-portin the bow allows several individuals to observe

Dr. Jules E. BenBenekholds Masters Degrees inNuclear Physics, OpticalSciences, Communica-tions and Engineering aswell as Doctorate degrees

in Physics, Human Resources and Commu-nications, at Harvard University and theMetropolitan Collegiate Institute (London)respectively. He was employed 20 years withRCA as Vice President of Research Labs.He served as an Engineering Officer in theUS Army War Department Technical Staffand consulted for NASA and other agencies.Dr. Jules BenBenek is currently employedas Director of Applied Technologies withKokes Marine Technologies, LLC.

the worksite simultaneously, while a single cu-pola view hatch on the sail provides complimen-tary viewing in 180 degrees.

Six function hydraulic manipulator armsare available, and provide one of many meansto perform intervention at depth. Additional spe-cialized equipment, both hydraulic and electriccan be installed at the request of the clients.

SummaryEliminating the need for costly and weather sen-sitive deployment ships, the RS Submarine hasproven itself to be a cost efficient platform whencompared to ROV and AUV operations with de-ployment requirements. Sea state is less of a con-cern, allowing for the reduced likelihood ofweather related project delays.

The RS Submarine represents the mostrecent and significant military technology to bebe made available to the civilian market. Theculmination of more then 100 years of develop-ment, and 12 years of direct offshore applica-tions, assures the reliability, safety andpracticality of this tool.

HowHowHowHowHow’s your image?’s your image?’s your image?’s your image?’s your image?BJ Marketing Communications Providing support to companies in the submarine cable industry for over 10 years

Brochure and literature design and production exhibition design and management website design and maintenance

Contact Ted Breeze Telephone +44 1206 230472 Facsimile +44 1206 231640 Email [email protected]


23

www.fugro.com

http://www.fugro.com

24

Local telecom expertsdisplay market savvy

Jacques Lèvesque, Mike Kennah and JohnGraham are experts in sinking telecoms assets,literally and figuratively.

The owners of Canada’s only installer ofunderwater fibre-optic cables sold their Kirklandfirm to a US giant at the peak of high-tech marketeuphoria in 2000, staying on to run things asthe industry self-destructed.

In April, with telecom finally showing signsof recovery, the three entrepreneurs bought ITInternational Telecom Group back from GeneralDynamics Corp at a discount. Price tags weren’trevealed, but in 2000 anything telecom-relatedfetched a high premium. The buyback comeswhen investors are still telecom-phobic. Theysold high and bought low.

So far, the wager is paying off. In the sixweeks since they took control, they nabbed twocontracts worth a total of $3.8 million – one inNova Scotia, the other in the Bahamas.

“General Dynamics is focusing more on itsmilitary side and we saw a bright future for thebusiness, so we decided to buy back ourfreedom,” said Lèvesque. ITG’s president.

The walls of ITG’s boardroom are coveredwith maps crisscrossed with coloured linksshowing marine fibre-optic lines.Much of thatmass of spaghetti was created during telecom’sheyday when there was a mad rush to connectthe world to handle growing Internet traffic.

ITG was launched using a $250,000 bank lineof credit in 1996. The company, which says it has

Entrepreneurs founded fibre-optic company, soldto a US giant at the peak of high tec euphoria, and

recently bought it back

By Andy RigaReprinted from the Montreal Gazette

25

been profitable every year since, flourished withoutoutside investors or government aid. Its workforcenumbers 21, including 13 in Kirkland, whereengineering and sales are centred, six in a 45,000sq ft Halifax plant and two in a British office.

ITG’s four founders, including Kennah andGraham, were from the marine division ofMontreal’s Teleglobe Inc., which by 1996 wasleasing rather than building fibre-optic capacity soit could focus on its core business – serving all ofCanada’s international telecom needs.

“We saw the industry was going to take off, agolden opportunity to take our experience andwalk out the door,” said Kennah, ITG’s chiefoperating officer. “Internet usage was doublingevery three months and eating up capacity.”

They didn’t leave empty-handed: Teleglobeimmediately hired the nascent company. Initially,ITG did consulting and maintenance work forTeleglobe and other carriers such as AT&T. Theyused profits to buy specialized equipment that dives1,500m under water, digs metre-deep trenches, andburies cables. Within two years it was workingon bigger projects – on its own for routes of under350 kilometres, and as a sub-contractor for largerrivals on longer, trans-oceanic routes.

“The big players subcontract to us becausewe’re cheaper,” said Levèsque, a former Teleglobevice- president since 1998. “We have always beenafraid of rusting assets, so instead of buying bigships that would have created big overhead, weleased them.”

ITG, whose workforce peaked at 60, hiredlaid-off and retired workers from Canadian firmswith telecom know-how, including Bell Canadaand Teleglobe.

“We brought all these older guys who werereal craftsmen in the industry, whereas (big newcompanies building global telecom networks)were in a hiring boom, taking on these youngguys,” Kennah said. “We did it at the same priceor cheaper but with more experienced people.”

By 1999, ITG was nipping at giants likeGlobal Crossing, Kennah said. “We popped upon the radar and that’s a dangerous thing for a

“The big players subcontract tous because we’re cheaper.”

ITG head Jacques Lèvesque

small company. When the big guys decide to killyou, they can easily undercut you and drive youout of business.”

ITG needed a big brother to survive and toland fatter contracts.

Then General Dynamics, with $14 billionUS in revenue and 57,000 employees, cameknocking. Its mainstay, US defence spending, waslagging and it wanted to expand commercialactivities. IT already had a fibre-optic installationdivision, but it focused on military contracts.

As part of the sale, Lèvesque, Kennagh andGraham stayed on to run ITG’s Canadian andBritish operations for up to five years. Two

founders, Vince Portulese and Steve Silvano,retired.

At the time, a slew of ambitious companiesflush with cash and dreams of limitless growthwere fuelling an underwater building boom.ITG’s expertise was in demand. Revenue reached$96 million in 2001, a four-fold increase from1999. Its client list was as industry Who’s Who:Alcatel, Tyco, SBC, China Telecom, MCI.

But by mid-2001, telecom’s descent beganas investors realized there was too much fibre-optic capacity. Carriers started failing.

And General Dynamics, a make of nuclearsubmarines and the M1 Abrams tank, saw biggeropportunities elsewhere. With George W Bushin the White House, defence spending was o theupswing. “We became more and more a marginaloperation,” Lèvesque said.

In its 2002 annual report, GeneralDynamics said it was exiting the cable-layingbusiness “because of substantial overcapacity inthe market and lack of contract backlog.” Citinga confidentiality agreement, ITG’s three owners,who each hold one-third of the company, wouldnot reveal the buy-out and buy-back prices.

“We bought it back at a good price,” wasall Graham, senior vice-president in charge ofsales and marketing, would say.

Overcapacity is still a problem for thetelecom industry but it is limited to high-trafficroutes such as London-New York and SanFrancisco-Tokyo.

26

“There is overcapacity in the oceans but thereare many opportunities in regional systems,”Graham noted, adding the telecom sector isbeginning to show signs of life, with carriers takingadvantage of the lull to boost capacity. Contractorslike ITG are also sought after because telecom firmsare reluctant to hire new workers.

ITG, which competes against either othersin the global cable-laying business, IncludingAlcatel, Tyco and Fujitsu, signed two deals lastmonth: a $750,000 contract with EastLinkCablesystems to link Cape Breton to mainlandNova Scotia, and a $3 million contract withCaribbean Crossings to install a Bahamas-Floridaconnection.

“I knew they had done quite a bit of workfor the local phone company and their price wasso much cheaper than the other (European)bidders,” said John Sheridan, EastLink’s fibre-optics planner.

ITG is bidding on several projects,including a $10 million contract to connect Îlesde la Madeleine to Gaspé, and a $40 million (US)Alaska-Oregon link.

The firm is in a nice niche, said telecomanalyst Iain Grant. There is a capacity glut onmany transatlantic. Trans-Pacific and Mediter-ranean routes, he noted. But there are “still manyplaces that need to be connected and water isstill a very good route to do that,” said Grant ofthe Seaboard Group. “There will be plentyof opportunities for them to keep busy.”

27

At submarine depths, goes deeper

500 m

Nexans was the firstto manufacture andinstall 384 fibersubmarine cable.Nexanshas qualified andinstalled their URC-1cable family for fibercounts up to 384 fibers.

For furter information, contact:Telecom: Vegard LarsenTel: + 47 22 63 76 47 E-mail: [email protected] & Gas: Jon SeipTel: +47 22 63 88 25E-mail: [email protected]

Nexans Norway AS P.O Box 130 Økern, N-0509, Oslo Norway Tel: + 47 22 63 88 20 Fax: + 47 22 63 74 55US Contact:Les ValentineTel. +1 281 578 6900 Fax: +1 281 578 6991 E-mail: [email protected]

Global expert in cablesand cabling systems

exans1500 m




28

The Recent PastFor SMD, as the leading supplier of trenchingequipment to the submarine telecoms industry,the last five years has seen staggering changes inlevel of production and pace of technologydevelopment. Some figures that illustrate thefirst point are that in it’s first 15 years SMD built27 subsea systems for telecoms; in the past 5 yearswe have built an amazing 43 machines. Thesehave included ploughs which could bury cableup to three times deeper than a standard ploughfor little increase in size. This plough, with thehelp of a unique jetting system, could go deeperand faster in sand, and with a similarly uniqueripping system, could extend cable protection

A DIFFERENT WAY OF LAYING SUBMARINE CABLES

by Michael Jones

using a ploughing into rock. And these are toname but a few of our innovations in cable layand burial over that period.

The Present RealityAt this moment, most of these ploughs and someof the ROV’s are laying idle. We don’t anticipatea recovery in this sector of the telecoms marketuntil well into the second half of this decade.

So, what is a telecoms supplier supposedto do in the meantime? Fortunately, as arelatively small company based around a core ofinnovative and flexible engineers, we have beenable to seek and exploit other outlets for ourtalents. In applying our thinking to the

renewable energy and military markets we havedeveloped technology, which has potential forfuture application to submarinetelecommunications and is the subject of thisarticle.

Breaking with ConventionTraditional practice in the submarine cableindustry is to lay the cable from a surface vesseland to either simultaneously or in a separate,later operation, bury the cable. When SMD wereapproached by Mayflower Energy, a newlyestablished offshore wind farm installer, to builda vehicle for burying power cables, we devised asystem, which brings together proven elementsfrom more conventional equipment to create auniquely capable machine. This has been doneby carrying the spool of lay cable on the vehiclerather than the surface vessel.

The self-propelled tractor carrying the spoolof cable is able to simultaneously lay and buryan entire interconnecting cable between adjacentwind turbines. Whilst it is performing thisoperation, it’s host vessel, the Mayflower jack-up vessel Resolution, can carry on with it’sprimary task of installing the topside windturbine.

The DetailThe Lay & Burial Tractor (LBT 1) is large bytelecom construction vehicle standards,weighing in at almost 60 tonnes (132,000lbs)

BREAKING WITHCONVENTION

29

when fully laden. Despite this, its large footprintenables the tractor to support and propel itselfon the weakest soil anticipated at wind farm sites.

The cable is spooled onto a large reelmounted on top of the tractor and which can beeasily removed for maintenance or loading newcable rapidly. The reel is also driven so that itcan pick up and payout whilst on the seabed.

Mayflower Energy’s 900kW LBT 1A combination of high power (900kW / 1200hp)and two different trenching tools, a chain cutterand a jet tool means that the vehicle can protectcable to 3m deep in a wide range of seabedconditions in a single pass. With a typical speedof 500m/hr (1640ft/hr), even in firm seabed, theaim is to launch, lay, bury, return and recover

LBT 1

Cable buried up to 3m directly from the reel

the vehicle in much less time than it will take toinstall the topsides. The tractor will also be ableto perform post lay burial on any cable ends leftexposed once the j-tube pull in is completed.

BenefitsThe system brings a number of benefits to thequality and efficiency of the cable installation.A major advantage is the cost saving from beingable to lay and bury the cable from the turbineconstruction vessel simultaneous to the topsideinstallation. Even if the cable installation is doneseparately from the turbine construction, thevehicle can be deployed from a lowerspecification and hence cheaper vessel thanwould otherwise be needed to conventionallylay and bury cable.

Laying cable directly from the vehicle intothe trench means there is less risk of damage tothe cable. Damage can typically occur from thetensioning device on the ship or on the seabedif the burial device runs over the cable.

A crucial part of laying cable to and fromoffshore structures is the j-tube pull-in. This isthe part of the operation where the cable is pulledinto the structure through a receiving bellmouth.Damage can often occur to the cable during thisoperation from pulling the cable over a roughseabed or exceeding its bend radius at the j-tubebellmouth. The cable can be pulled straight offthe tractor mounted reel into the bellmouth atthe first structure and then laid and buried

directly away from it. At the second structurethe vehicle lays a loop of cable into a zone infront of the bellmouth from where it can bepulled into the j-tube. The tractor has theadvantage of being able to lay much closer tothe tower than a vessel and also has much greatercontrol over the position of the loop. Also,during the pull-in the vehicle can be used toobserve the operation and even manipulate theloop using its crane and a special tool.

The idea of placing the lay cable on a subseavehicle is by no means a new one. Indeed, forthe past three years SMD has been developing aplough for military application, which carries apack of small diameter cable for direct lay into atrench created by a passive narrow share. Theplough has many of the features that have madeSMD ploughs so successful such as passive power

30

steering and a lifting drawbar. It also has otherinnovations such as a tow umbilical, whichmeans there is only one cable in the watercolumn, and an onboard inspection class ROVin a garage for carrying out various surveillanceand intervention duties.

Telecom ApplicationsAn obvious use for vehicles, which can lay andbury cable, is in lightweight, repeater less cable.Controlling the catenary of lightweight cable isnotoriously difficult in areas of strong currentsand usually the cable is laid directly into theburial device leading to high residual tensions.Also, lightweight cable cannot provide stabilityto the plough during launch in the same way anarmoured cable does and even with the help ofpositioning thrusters it can sometimes spin. Theresult of this is a tangled towrope, umbilical andlay cable! All of these problems could beovercome, together with the same benefits as forthe wind farm application of improved efficiencyand quality of installation, by placing the laycable on the burial vehicle.

This technology is immediately applicablefor use in the offshore oil and gas industry andwhere fibre optic communication betweenplatforms and subsea structures is becomingmore widespread. There will be limitations inrange to around 30km, but as the technology insubsea fibre optic connectors improves, longerruns will be more practically possible. The

technique also raises the possibility of being ableto replace damaged lengths of cable without needto recover the cable to the surface.

From contract commencement in earlyMarch 2003, the Mayflower LBT system wasscheduled for completion in late August. To meetthe customer requirements, the project teamhave managed to pull delivery forward by anincredible four weeks to just 22 weeks from startto finish. SMD will also be providing a fulloperating team through our sister companyBywell Subsea to assist with the first job on theNorth Hoyle Development in the Irish Sea.

SMD are planning an open day in the firstweek of August for visitors to come and see theLBT1. This will be a unique opportunity to notonly see the system, but also to meet theteam that designed and built it.

Michael Jones has tenyears experience as aDesign Engineer, ProjectManager and Sales &Marketing Manager insubsea cable and pipelineburial equipment at SMD.He has a Bachelor of

Engineering from the University of Nottinghamand is a Chartered Engineer. He worked forBritish Petroleum before joining SMD in 1992.

(We also do short and medium haul systems)

The name Caldwell has been synonymous withsubmarine cable installation and repair for over 40 years.

The Caldwell Group is a marine construction groupspecializing in submarine cable operations worldwide.

Pre-Laid Shore EndsRoute ClearancePre-Lay Grapnel RunsRepeaterless SystemsCable Clearance

Cable Burial to 10mDepth of CoverCable repairsDiving/Vessel ServicesHDD Operations

IN FOR THEIN FOR THEIN FOR THEIN FOR THEIN FOR THELONG HAUL!LONG HAUL!LONG HAUL!LONG HAUL!LONG HAUL!IN FOR THEIN FOR THEIN FOR THEIN FOR THEIN FOR THELONG HAUL!LONG HAUL!LONG HAUL!LONG HAUL!LONG HAUL!

1433 Hooper Avenue, Toms River, NJ 08753, USA732-557-6100 (Tel) 732-341-3078 (Fax)

[email protected]


http://www.caldwellmarine.com

31

For more information on OFS’ completefamily of fibers for the submarine market,please visit the OFS Fiber website at www.ofsoptics.comor call Tom Davis at (973) 655-1502

OFS innovates today’s major submarinenetworks with fibers that support longerdistances and higher capacities than everbefore. The results? Lower system costsand unrivaled performance.

OFS has the optical fiber to support allyour emerging system design needs –

Lower dispersion management costHigher reliabilityGreater capacity and bandwidth

To unleash your system’s fullcapabilities while keeping yourcosts competitive, choose OFSfiber for your next submarinecable project.

http://www.ofsoptics.com

32

Hibernia Atlantic is the new name for whatwas 360atlantic, originally owned by360Networks. Once 360Networks filed forChapter 11 they decided to sell off 360atlanticand Columbia Ventures Corporation boughtthe system for $18M.

Columbia Ventures Corporation are acommodities company based in Vancouver, WA.They own an aluminium smelter in Iceland, afibre company in Spokane, WA as well as variousother interests. Ken Peterson is the head of thecompany and when asked why he boughtHibernia Atlantic he quoted “I bought it becauseI thought that the price was right”

The system has not changed in design sinceit was installed by Tyco some two and a half years

ago. It is a four fibre pair ring connecting Ireland,UK, Canada and the USA.

There are some unique features about thesystem as follows:-

The only direct connection between thecontinental United States and Ireland.The landing point in Southport in theUnited Kingdom is diverse from the usualCornwall landings resulting in a shorterbackhaul into London.The landing point in Boston, MA is diversefrom the usual New Jersey landings.As the trans-atlantric route is shorter than

some others this gives an improved latency time.The system has been operational from the

day the system was completely handed over to

the new owners, however buying a “distressedasset” will always have it’s challenges and thepurchase of Hibernia Atlantic was no exception.The number of permits, wayleaves, leases,crossing agreements, and contracts that wererequired to be novated, assigned or transferredseemed to grow on a daily basis.

However once all these had beencompleted the job of advertising the system as“open for business” got underway.

There was a dual opening ceremony inDublin, Ireland and Boston, MA a review ofwhich follows.

History was made at the recentsimultaneous Trans-Atlantic seminars thatlaunched both the Hibernia AtlanticInternational Exchange Centres in Dublin andBoston. Using the Hibernia Network itself clearlydemonstrated that this submarine system is fullyoperational. It also highlighted the potentialvalue derived from using such a low cost, highspeed and high capacity network

The entire seminar content was relayedfrom Dublin to Boston using a combination ofthe Spectel voice and Data conferencing bridgetechnology and the latest video conferencingofferings from Tandberg. This demonstration initself highlighted the potential that noweconomically exists for the dramaticimprovement of corporate communications, tothe point that highly effective collaborativeworking environments are created with their US

DUBLIN ADUBLIN ADUBLIN ADUBLIN ADUBLIN ATTTTTTTTTTACHED TO BOSTON!ACHED TO BOSTON!ACHED TO BOSTON!ACHED TO BOSTON!ACHED TO BOSTON!

by Alasdair Wilkie, Marine Manager, Hibernia Atlantic

33

counterparts. This is of particular importance forthose Irish subsidiaries seeking to expand theirIrish operations by trying to attract even morecritical tasks within their corporation. The TransAtlantic connectivity options now available fromHibernia Atlantic provide the executives of theseoperations with a major competitive advantagewhen competing with other corporate locations.

A senior executive of the Nortel ProductsGroup presented the developing market trendsfor Optical level services. They highlighted thestrong emergence of both LAN interconnect andstorage networking over exceptionally longdistances. Nortel presented both the

The seminar audience of 170 people in total(40 in Boston) also witnessed Minister forTelecommunications and the Marine, Mr.Dermot Aherne T.D. open these two HiberniaAtlantic Centres simultaneously – 2 placesat once.

has entered into an arrangement with

Lloyd’s Register -Fairplay

making available, complimentary tosubscribers, comprehensive databases ofcommercial vessels (www.sea-web.org/),ports and companies (www.portguide.com).

In order to qualifyfor a free trial of these services, contact

[email protected].

Alasdair Wilkie is MarineManager for HiberniaAtlantic. He is a qualifiedengineer, with a B.Sc. inElectrical and ElectronicEngineering, havingspent the past eighteen

years in the submarine cable industry, firstlywith STC Submarine Systems (now AlcatelSubmarine Networks), then Cable & WirelessMarine, then International Telecom and mostrecently as the Technical Director of Flute Ltd.His work has ranged from terminal equipmentdesign, terminal station design, and systemdesign through to the installation andcommissioning of systems.

requirements and growth statistics of thesemarkets and they endorsed the Hibernia Atlanticservice offering developed for these increasinglyimportant corporate markets. To illustrate theunique capabilities and characteristics of theHibernia Atlantic system 2 global informationtechnology leaders combined to demonstrate thevalue to corporations of mirroring their entireIT operations across the Atlantic.

EMC, the dominant market leader inremotely mirrored storage systems, with an 80%market share and CNT the likewise 800lb gorillaof Remote Data Storage NetworkingTechnologies, constructed a mirrored ITproduction environment in both Hibernialocations in Dublin Ireland and Boston MA. TheDublin system was running a 2,000 userMicrosoft Exchange environment which wasmirrored, at each individual transaction level,to a similar environment in Boston. Acatastrophic failure of the Dublin server was thensimulated and full recovery of this systemoccurred from the Boston servers, resuming fullservice availability in just the few minutes itrequired to ‘boot’ their Boston server. Thisrecovered environment was in synch with theDublin system image and all managementcontrols and audit trails were also available. Thisoffers huge potential for combined USA IrelandIT operations. Such an environment had neverbeen recovered Transatlantic before so historywas made.

http://www.sea-web.org

http://www.portguide.com


http://www.portguide.com


34

A global guide to the latest known locations ofthe world’s cableships, as at JULY 2003.

SAILING DETAILS (or last known location)Vessel Name Built Best Contact GT Speed

Sailed Date Port Country

Arcos 2002 BOHLEN & DOYEN 3790 0 02/06/03 Pasir Gudang Malaysia

Asean Restorer 1994 SINGAPORE TELECOMMUNICATIONS 11156 16 24/05/03 Singapore Republic of Singapore

Bold Endurance 1979 SECUNDA MARINE 9418 14.3 24/05/03 San Francisco United States of America

C.S.Wave Mercury 1982 GLOBAL MARINE SYSTEMS 10105 16 07/05/03 Kobe Japan

Cable Protector 2002 SINGAPORE TELECOMMUNICATIONS 2935 0 17/05/03 Pulau Batam Indonesia

Chamarel 1974 NOT APPLICABLE 5925 16.5 24/05/03 Durban South Africa

Discovery 1990 FRIARY OCEAN 8248 12 04/05/03 Dundee United Kingdom

Eclipse 1980 CAL DIVE INTERNATIONAL 7114 13 05/06/03 Gibraltar Gibraltar

Elektron 1969 STATNETT ENTREPENOR 1628 0 27/05/03 Schiedam Netherlands

Heimdal 1983 ALCATEL SUBMARINE NETWORKS 10471 16 07/06/03 Kobe Japan

Ile de Batz 2001 NOT APPLICABLE 13973 15.4 02/05/03 Melbourne Australia

Ile de Brehat 2002 LOUIS DREYFUS ARMATEURS 13978 15.4 19/06/03 Cape Finisterre Spain

35



Ile de Sein 2001 NOT APPLICABLE 13978 15.4 02/06/03 St. Michael’s Portugal

KDD Ocean Link 1992 KOKUSAI CABLE 9510 15 06/06/03 Yokohama Japan

KDD Pacific Link 1993 TOKYO LEASE 7960 13 10/06/03 Moji Japan

Koushin Maru 1998 DOKAI TUGBOAT 4822 12 17/05/03 Moji Japan

Leon Thevenin 1983 FRANCE TELECOM 4845 15 31/05/03 Vigo Spain

Maersk Defender 1996 MOLLER A.P. 5746 0 12/06/03 Calais France

Maersk Recorder 2000 MOLLER A.P. 6292 14 07/06/03 Panama Canal Panama

Maersk Repeater 2000 MOLLER A.P. 6292 14 28/05/03 Wakamatsu Japan

Miss Clementine 1996 COASTLINE MARITIME 3637 9 17/06/03 Kemaman Malaysia

Pacific Guardian 1984 GLOBAL MARINE SYSTEMS 6133 10 25/05/03 Auckland New Zealand

Pertinacia 2003 NOT APPLICABLE 12100 14 19/06/03 Tarifa Spain

Peter Faber 1982 NOT APPLICABLE 2854 0 23/05/03 Calais France

Pleijel 1972 TELEVERKET 1650 11 16/05/03 Ronne Denmark

Provider I 1978 MARINE SURVEY 10493 14 18/06/03 Rotterdam Netherlands

Raymond Croze 1983 FRANCE TELECOM 4845 15 29/05/03 Catania Italy

Rene Descartes 2002 FRANCE TELECOM 13864 15 14/06/03 Gibraltar Gibraltar

Teliri 1996 ITALMARE 8345 14.5 11/06/03 Valencia Spain

Teneo 1992 TRANSOCEANIC CABLE SHIP 3051 14.5 04/06/03 Catania Italy

Tyco Decisive 2002 NOT APPLICABLE 12130 13.9 01/06/03 Baltimore United States of America

Tycom Reliance 2001 NOT APPLICABLE 12130 13.9 26/05/03 Baltimore United States of America

36



Umm Al Anber 1972 EMIRATES TELECOMMUNICATIONS 7750 18 31/05/03 Jebel Ali United Arab Emirates

Wartena 1958 NOT APPLICABLE 407 9.5 14/06/03 Oskarshamn Sweden

Wave Sentinel 1995 GLOBAL MARINE SYSTEMS 12330 18.25 15/05/03 Belfast United Kingdom

Wave Venture 1982 GLOBAL MARINE SYSTEMS 10076 16 13/06/03 Singapore Republic of Singapore

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38

My dear friend,No need to say that I have appreciated yourreactions to my last letter. Very kind of you. Hopeit is sincere from you, not just politeness. Myintention is to stimulate debate not to look forconsensus!

The world situation has recently changed,and is still changing in an incredible manner!For the American people and rightly soSeptember 11 has drastically changed theirperception of the world.

In Europe it is the collapse of the Berlinwall which played the similar role. China andIndia represents one third of the worldpopulation. It should be no surprise thateverything is destabilized, that it has suddenlybecame more difficult to understand each other.The 21st century is here!

This will impact enormously the submarinecable business. The past models and methods aregone. We cannot just wait for a restart of it, as ifit the present period was a temporary pause; wewill need to reinvent something completely new.The business will only restart through a hugeeffort of imagination, creativity.

At the heart of this effort lie thefollowing questions: What type of globalnetwork infrastructure does the world need?What is the role of such an infrastructure?Being connected to an efficient global network

is it the privilege of rich and developedcountries, or is it a development tool accessibleto everyone?

Oxygen project was an attempt in such adirection. At this moment, we have empty cablein the Atlantic, and several countries are stillwaiting for their first fibre optic connection.

An infrastructure is not just a product. Asubmarine cable is like a bridge on a river, it isa tool of public and general interest. Decidingwhere to build it, which technology to use,which design, all these decisions need to betaken in a somewhat planned and collectivemanner.

Where are those issues thought through,analysed? I am somewhat amazed andconcerned not to see any initiative being takenduring the present recession!

We had initiated years ago in Europe, underthe name of Europtic, informal meetingsbetween the main Telcos and the suppliers. Thesemeetings were events of non-committingexchanges of views, on technology trends andbusiness evolutions. Such informal structureexists in every business. Why not here? A dialogbetween the capacity owners and the suppliersis indispensable!

My friend, the business is frozen, but soare the managers around! They need a wake-upcall. Is there a pilot in this plane?

Jean Devos

Letter to a friend

from Jean Devos

39

DiaryDiaryDiaryDiaryDiary FORTHCOMING CONFERENCES AND EXHIBITIONS

24-27 August 2003 13th International Symposium on Unmanned Untethered Submersible Technology,

University of New Hampshire, USA. www.ausi.org/uust/uust.html

26-29 August 2003 Offshore Comunications Conference and Exhibition 2003, Houston, Texas, USA. www.offshorecoms.com

2-5 September 2003 Offshore Europe 2003, Aberdeen, Scotland, www.offshore-europe.co.uk/

9-12 September 2003 Defence Systems & Equipment International, London, UK, www.dsei.co.uk/

22-26 September 2003 Oceans 2003 MTS/IEEE, San Diego, California, USA, www.oceans2003.com/

24-26 September 2003 Submarine Networks World 2003, Singapore, www.carriersworld.com

7-8 October 2003 4th India Telecom Conference, Mumbai, India. www.indianteleconference.com

12-18 October 2003 ITU Telecom World 2003, Geneva, Switzerland, www.itu.org

24-26 November 2003 Hydro 2003: 4th Australasian Hydrographic Symposium,

Christchurch, New Zealand, www.hydrographicsociety.org.nz/conference.htm

17-19 February Underwater Intervention 2004, NewOrleans, Louisana, USA. www.underwaterintervention.com

11-14 January 2004 Pacific Telecom Conference 2004, Honolulu, Hawaii USA. www.ptc.org/ptc2004

16-19 March 2004 Oceanology International 2004, London, UK, www.oceanologyinternational.com/

28 March - 1 April 2004 SubOptic 2004, Principality of Monaco, www.suboptic.biz

http://www.ausi.org/uust/uust.html

http://www.offshorecoms.com

http://www.offshore-europe.co.uk/

http://www.dsei.co.uk/

http://www.oceans2003.com/

http://www.carriersworld.com

http://www.indianteleconference.com

http://www.itu.org

http://www.hydrographicsociety.org.nz/conference.htm

http://www.underwaterintervention.com

http://www.ptc.org/ptc2004

http://www.oceanologyinternational.com/

http://www.suboptic.biz

Voice of the Industry - SubTel Forum 9.pdfApr 01, 2004 · SubOptic 2004 and Submarine Telecoms...

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Transcript of Voice of the Industry - SubTel Forum 9.pdfApr 01, 2004 · SubOptic 2004 and Submarine Telecoms...