U.S. Shipping Partners L.P

U.S. Shipping Partners L.P. (U.S. Shipping) is a provider of long-haul marine transportation services, principally for refined petroleum products, in the United States domestic coastwise trade. The Company is also involved in the coastwise transportation of petrochemical and commodity chemical products, as measured by fleet capacity. U.S. Shipping’s fleet consists of 11 tank vessels: six integrated tug barge units (ITBs), one product tanker, three chemical parcel tankers and articulated tug barge (ATB) unit. The Company’s primary customers are oil and chemical companies.
Integrated Tug Barge Unit Fleet
U.S Shipping began operations in September 2002, when it acquired its six ITBs from a division of Amerada Hess. The six ITBs primarily transport clean refined petroleum products, such as gasoline, diesel fuel, heating oil, jet fuel and lubricants, from refineries and storage facilities to a variety of destinations, including other refineries and distribution terminals. Three of the Company’s ITBs are operating under time charters, two are operating on consecutive voyage charters, and one is operating in the spot market. The Company’s ITB vessels are Jacksonville, Groton, New York, Baltimore, Philadelphia and Mobile. All six ITBs are sister vessels of the same design and built to the same specifications.
Product Tanker Fleet
The Company’s Houston vessel is a Jones Act coastwise double-hulled product tanker. The vessel is capable of carrying approximately 240,000 barrels of petroleum products. The vessel trades in clean petroleum products in the coastwise Jones Act trade, and the multi-year time charter, which began in June 2006, accounts for 100% of its usable capacity.
Parcel Tanker Fleet
U.S. Shipping’s parcel tankers carry specialty refined petroleum, petrochemical and commodity chemical products primarily from refineries, and chemical manufacturing plants and storage tank facilities along the coast of the United States Gulf of Mexico to industrial users in and around East Coast ports. The specialty refined petroleum products transported on its parcel tankers are generally not the types of refined petroleum products transported by its ITBs or its product tanker, but are products shipped in smaller volumes and used primarily in the manufacture of other products. Petrochemical and commodity chemical products transported by the Company’s parcel tankers consist primarily of paraxylene, caustic soda, alcohol, chlorinated solvents, alkylates, toluene and ethylene glycol. The Company owns three parcel tankers: the Chemical Pioneer, the Charleston and the Sea Venture.
The Chemical Pioneer has over 40 cargo segregations, and the Charleston and the Sea Venture each have over 20 cargo segregations, which are configured, strengthened and coated to handle various sized parcels of a variety of petroleum products and industrial chemicals. Its parcel tankers, the Chemical Pioneer, the Charleston and the Sea Venture, primarily transport specialty refined petroleum, petrochemical and commodity chemical products, such as lubricants, paraxylene, caustic soda and glycols, from refineries and petrochemical manufacturing facilities to other manufacturing facilities or distribution terminals.
Articulated Tug Barge Fleet
ATBs, similar to ITBs, consist of a tugboat (which provides propulsion) and a cargo-carrying barge using a coupling system that connects the two vessels. Unlike the rigid connection found on ITBs, an ATB uses a hinged connection. In July 2007, the Company completed construction and commenced commercial operations of its first ATB, the ATB Freeport. The ATB Freeport serves chemical customers. The ATB Freeport is under contracts of affreightment to transport commodity chemical products with specified minimum volumes that, together with a requirement that the customer ship any excess volume of the products covered by the contract on the ATB unit, are expected to utilize substantially all of such ATB unit’s anticipated capacity for 2008.