Marcon International, Inc.

Ship Sales & Charters Consultants September 2002

TANK BARGE MARKET REPORT Gentlemen: Following is a breakdown of both foreign and U.S. tank barges officially on the market and available through Marcon. Not included are those barges not officially on the market, which we may be able to develop on a private and confidential basis.

INLAND TANK BARGES Barrel Capacity

Under 10,000

10,000- 19,999

20,000- 29,999

30,000- 39,999

40,000 Plus

Total

Jan 1998 31 18 12 0 0 61 Jan 1999 31 14 11 1 0 57 Jan 2000 33 12 14 0 0 59 Jun 2000 22 15 15 0 0 52 Sep 2000 22 14 17 0 0 53 Feb 2001 22 14 11 0 0 47 May 2001 16 8 10 0 0 34 Sep 2001 11 8 8 0 0 27 Dec 2001 11 8 8 0 0 27 Mar 2002 22 7 10 1 0 40 Jun 2002 21 17 13 1 0 52 Sep 2002 (total) 26 22 15 4 0 67 Sep 2002 (U.S.) 16 20 9 3 0 48 Avg. Age (total) 1974 1972 1968 1963 -

OCEAN AND COASTWISE BARGES Barrel Capacity

Under 10,000

10,000- 19,999

20,000- 29,999

30,000- 39,999

40,000- 49,999

50,000 Plus

Total

Jan 1998 12 7 9 4 5 4 41 Jan 1999 12 10 3 4 5 4 38 Jan 2000 15 8 5 5 4 2 39 Sep 2000 16 8 4 3 3 3 37 Feb 2001 12 5 4 3 3 2 29 May 2001 13 4 3 2 2 2 26 Sep 2001 13 3 4 3 1 2 26 Dec 2001 11 4 3 3 1 4 26 Mar 2002 16 7 2 4 0 4 33 Jun 2002 16 7 3 3 0 3 32 Sep 2002 (total) 12 6 5 3 1 3 30 Sep 2002 (U.S.) 1 1 4 3 1 3 13 Avg. Age (total) 1996 1991 1976 1971 1971 1965

In addition to those tank barges officially listed for sale, Marcon currently has 6 inland and 15 ocean / coastal tank barges available for charter.

PO Box 1170, 9 NW Front Street Coupeville, WA 98239 U.S.A. EasyLink 4931464 Telephone (360) 678 8880 Fax (360) 678-8890 E Mail info@marcon.com www.marcon.com

Market Overview Of the 2,571 barges (excluding vessels) Marcon currently tracks, 554 are tank barges with a total of 97 currently officially on the market for sale. Twelve of the ocean/coastwise barges, mostly of foreign registry, were built within the last ten years. Ten of the ocean and coastal barges listed for sale are over 25 years of age with the oldest listed being a 34,636dwt barge built in 1956 as a tanker and converted to a single hull barge in 1977 (see File TB99021 under “Featured Listings” at the end of this report). Only three of the 67 inland barges for sale are less than 10 years of age with 36 being over 25 years of age with the oldest being 1952. Ages are not shown for 21 of the inland and 3 of the ocean / coastal barges listed. As always, there are exceptions and a lot of variables depending on flag, exact barge condition, OPA’90 retirement date, coatings, size, certificate status, etc. but average asking prices compared to June 2002 have remained steady for inland barges under 10,000bbl, fallen abt. 27% for those in the 10-20,000bbl range and fallen abt. 8% for those in the 20-30,000bbl range. This year to-date, actual sales prices for all vessels and barges sold by Marcon have averaged 83.45% of asking prices, up from the previous report at 76.51%, but this increase was primarily due to a couple recent sales at full asking price where the Sellers negotiated on non-compete terms than the actual sales price. U.S. Waterborne Commerce Statistics Center – August 2002 Following statistics from the U.S. Army Corps of Engineers Navigation Data Center.

Market Comments Generally we have had a decline in both domestic barging freight rates and reduced volumes. Although there was an exceptionally strong 2002 driving season and a higher demand for gasoline, this will weaken in the coming weeks. U.S. and international economies have been stuck in low gear and both this and continued low demand for jet travel as evidenced by airline industry cutbacks have generally dictated a low energy demand. We need a healthy and confident economic recovery to have a healthy tank barge market. Both are now uncertain and very fragile due to dominating factors from economics to the political which we do not have to necessarily outline as all we have to face the headlines daily.

Coming to the tail end of the asphalt season leaves some operators wondering if there even was a season this year as barge asphalt movements are estimated to be down by 50% over last year. Reasons given for the poor stats fault - 1. State, county and municipalities deferring road maintenance while redirecting highway funds to meet immediate security needs. 2. Refineries making less & less asphalt as they squeeze every last drop of crude to produce cleaner (more valuable) products. 3. Imported asphalt available at costs way above normal. Much of the inland river heated barge fleet is tied up out of service with regulatory & maintenance deferred until better times – lets hope for a cold winter! Recent News – Newbuildings & Conversions New construction OPA’90 double skin tank barges continue to be built in the U.S. and there are even discussions between some builders and operators for larger ATB units in the range of 285-300,000bbl with some builders having designs on the board for 335-340,000bbl ATB’s. One builder contacted though felt that some of the oil companies were “dragging their feet” on future long-term commitments and until operators have firm contracts these new big ATB’s will continue to only exist on paper.

Vane Line Bunkering of Baltimore, MD recently launched the first of two 364’ x 62’ x 25’ double skin, coastal service tank barges appropriately named “Double Skin 51” at Jeffboat in Jeffersonville, Indiana. “Double Skin 51” was built to a new design provided by Maritime Design, Inc., naval architects and marine engineers, Ponte Verda Beach, Florida. The manned barge features a flush deck, with recessed crews quarters and machinery spaces to provide better visibility for the tug operators and an ice-strengthened bow. “Double Skin 51” is designed to carry Grade “B” oil and other petroleum products in 10 tanks and is equipped with an 8.6 million BTU Vapor Thermal Heater and can load at a

maximum rate of 17,000 barrels per hour, with a discharge rate of 8,500 barrels an hour from its two diesel driven deep well pumps. Barge is equipped with two Caterpillar 3412 engines as prime movers driving Byron Jackson 4-stage pumps and two Caterpillar 3304, 105kw generators providing electricity for the barge and thermal heater. Deck equipment includes Parker make-up winches, 30” hydraulic capstans fore and aft, Yokohama fenders, hydraulic hose booms and a hydraulic anchor windlass. “Double Skin 51” is an ABS +A1 Oil Tank Barge and will carry all U.S. Coast Guard approvals and certificates. This barge may be the largest vessel launched at Jeffboat since the LST’s during World War II. The three boats that “caught” the barge after being launched were all owned by McBride Towing Co. out of Harrods Creek, KY. They usually just have one boat standing by to grab a barge as she comes down the ways, but this barge being 25’ high and 364’ long required a little more. McBride hung straps and did a perfect job of easing her alongside after the ceremony. Barge is along side Jeffboat’s pier for about two

weeks of outfitting and preparing before the 3,000 mile delivery to Baltimore. The Vane triple screw, 110’, 2700HP Vane tug “Patriot” will take over the barge, once delivered to Baltimore, Maryland and will make up the “unit”. Vane Line Bunkering operates a fleet of over 40 vessels, which services the mid Atlantic and Northeast. The barges ranging in size from 13,000 to 53,000 barrel are split into clean oil and black oil categories. Vane also provides launch service, lube oil delivery and has a Marine Safety Service that also includes USCG approved life raft service. Vane Brothers was established in 1898.

Gunderson Marine of Portland, Oregon launched Sause Bros.’ newest 374’ x6’ x 29.5’, 80,000bbl, OPA’90 double skin barge “Commencement Bay”. After launching, the 12,700ltdw barge was towed to Coos Bay, where crews from Southern Oregon Marine (SOMAR) will outfit her with deckhouses, pump machinery and cargo piping which are being fabricated and assembled at SOMAR. Final delivery of “Commencement Bay” to U.S. Oil and Refining is scheduled for December 2002. The completed barge will have an increased heating capacity and Grade “A” certification to carry crude oil as well as vacuum gas oil and asphalt. Barge will be equipped with a vapor recovery system and a new electronic closed gauging system allows tankermen to both gauge individual tank locations and view status of all tanks from a centralized location on deck. At this same time, Gunderson is starting the sub-assemblies of the “Alsea Bay”, which is the second of this class under construction. Launch date for this barge is scheduled for January 2003. “Alsea Bay” will be almost identical to “Commencement Bay” except for skeg design. Sause Bros. recently commissioned Nautican of Vancouver, BC and the B.C. Research Institute to perform model tests comparing conventional skeg design with a newer type of hydralift skeg. Results of testing looks very good and Owners decided to fit “Alsea Bay” with hydralift skegs. This will allow a full scale test between two barges of identical design with different skeg designs. Sause Bros. feels that with the new skegs, “Alsea Bay” may be as much as 40% easier to tow. Model tests also showed some other areas where the design can be improved, but these will require further analysis to know if the savings would be significant. Manitowoc Company, Inc. in July announced the launch of the 127’ “Ocean Reliance” the first of two tugs being built at Manitowoc's Marinette Marine subsidiary for Vessel Management / Crowley Maritime. When delivered, “Ocean Reliance” and sister “Coastal Reliance” will be mated with 155,000bbl, double-hull petroleum barges, which are being constructed at Manitowoc's Bay Shipbuilding subsidiary. “Ocean Reliance” is powered by 9,280hp engines and equipped with an Intercon system that will link the ocean-class tug with its 512’ barge. Scheduled for delivery later 2002, both units comply with OPA '90. Both will operate in the Pacific Northwest and are reportedly among the largest and most-sophisticated units of their type constructed in the U.S. Halter Marine launched “Capella” (the brightest star in the constellation Auriga) an 80,000bbl tank barge for J&L, Inc. The barge, the first project Halter has undertaken for J&L, was built at Halter’s Gulfport, MS yard. Delivery was planned for the 30th of August. The new barge is 332’ x 74’ x 25’ and built to U.S. Coast Guard standards under Sub-chapter ‘D’, as a tank barge certified to carry Grade ‘A’ or lower bulk petroleum products and certified by the American Bureau of Shipping as an +A1 Oil Tank Barge.

Bollinger Shipyards, Inc., Lockport, La., delivered “DBL101”, the first of four OPA’90 double hull, ocean tank barges to K-Sea Transportation. While the “DBL 101” was in final stages of construction, Bollinger also retrofitted the tug “Tasman Sea” with a JAK coupler system, creating an ATB unit. Bollinger Marine Fabricators (BMF), Amelia, La., fabricated modules for the new 400’ x 74’ x 25’, 100,000bbl barge and shipped them to Bollinger Gretna, Harvey, La. for final assembly and installation of piping and other systems.

Bollinger Gretna has built numerous double hull and OPA ’90 barges throughout its 65-year history. “DBL101” was built to a new design by Guarino & Cox, Mandeville, La., which was adapted from a Richard Taubler Inc. design. The unmanned barge features an 8’ high trunk deck to increase cargo capacity, and is designed to carry Grade “A” oil and other petroleum products in ten 9,700 to 10,300bbl tanks. “DBL 101” is equipped with vapor recovery and Metritape closed gauging and alarm systems and can load at a maximum rate of 17,500 BPH, with a discharge rate of 4,900 BPH from each of two diesel driven deepwell pumps. Barge is also equipped with a Byron Jackson ballast system with two hydraulic deepwell pumps. “DBL101” is classed ABS + A1, Oil Tank Barge, Unlimited Ocean and U. S. Coast Guard Sub-Chapter “D”. K-Sea’s “DBL 81”, the first of two 80,000bbl clean oil barges built at Bollinger, is under construction at BMF with a projected January 2003 delivery. Walter Berry, executive VP and COO, of Bollinger said, "While “DBL101” was under construction, K-Sea’s 123.5’ tug, ‘Tasman Sea’, was being retrofitted at Bollinger Gulf Repair in New Orleans with a JAK coupler system. The installation required 42 days to complete, allowing K-Sea to plan its

withdrawal from service with a minimum of downtime as the entire ATB project and completion dates were under one integrated management and production system. These are exactly the kinds of expanded services and synergies we envisioned when we added the two New Orleans area shipyards in August 2000, along with another in Calcasieu, Louisiana and two others in Texas. The yards worked simultaneously on the same project to provide our customer with better service." Built by Acomarin Engineering, Oy Ltd., Finland, a sister company of Acomarin International, the JAK coupler system, unlike old hawser boat/barge connection systems, allows the tug and its barge to act as one unit in the water. The tug has a steel cylinder, or pin, on each side near the front of its hull and the barge has a corresponding plate on each side to receive the pins. Air pressure provides the force required to hold the cylinders in place. According to Acomarin, the JAK coupling offers a number of advantages when compared to other assemblies including: The system weighs approx. 35% less than other systems; the couplings contain no cast steel components, the coupling fixing plates are surface mounted (welded) to the barge; no changes in general arrangements are required on existing vessels as the JAK-equipment is mounted just below the main deck of the tug; dynamic forces exerted to the JAK activating cylinders and supports are more controlled than with conventional systems; no separate hydraulic system is required as JAK is driven by the tug’s ordinary compressed air system; and design and installation require considerably less labor than other comparable systems. Bollinger Gulf Repair installed the first application of the JAK coupling system on the K-Sea Transportation, 111’ tug, “Kara Sea” and 380’ barge, “Spring Creek” in 2001. K-Sea operates 54 vessels in both domestic U.S. and international service. The tug fleet is primarily used to deliver K-Sea barges, but is also involved in general harbor work. The 37 barges and coastal tankers, ranging from 165,000 to 12,015 BBL’s, are generally split into three categories: clean oil, black oil and specialty products. In June, K-Sea Transportation and the Maritime Administration (Marad) closed the sale, and the related U.S. Government guarantee, for $40.4 million in privately placed bonds. These funds will provide permanent financing for K-Sea’s on-going construction program for their new 80–100,000bbl double hulled barges which will replace single-hulled barges scheduled to phase-out of the U.S. Coastwise service over the next several years. The $40.4 million in bonds were issued under Marad’s Title XI financing guarantee program. Under this program, repayment of interest and principal on the bonds is guaranteed by the U.S. Government, which results in extremely attractive interest rate and payment terms. After delivery of the fourth new barge in this program, K-Sea’s fleet will be in compliance with the double-hulling requirement of OPA’90 until December 2014. Following is latest breakdown of Current Commercial Shipbuilding Contracts from MarineLog and Colton Co.:

Type Hull # or Status Customer GT Size $mm Delivery

Alabama Shipyard (Mobile AL)

Tank Barge Firm Allied Transportation 129,000 barrels 17 2002 Tank Barge Firm Penn Maritime 120,000 barrels 17 2002

Tank Barge Firm Penn Maritime 120,000 barrels 17 2002

Tank Barge Firm Penn Maritime 80,000 barrels 11 2002

Tank Barge Firm Reinauer 150,000 barrels 18 2003

Avondale Industries (New Orleans LA)

Crude Carrier 2499 Polar Carriers 82,545 140,000 dwt 164 Dec-02

Crude Carrier 2500 Polar Carriers 82,545 140,000 dwt 196 Sep-03

Crude Carrier 2501 Polar Carriers 82,545 140,000 dwt 205 May-04

Crude Carrier Option Polar Carriers 82,545 140,000 dwt Jun-05

Crude Carrier Option Polar Carriers 82,545 140,000 dwt Jun-06

Bay Shipbuilding (Sturgeon Bay WI)

Tank Barge 749 Vessel Mgmt. Services 150,000 barrels 18 Sep-02

Tank Barge 751 Vessel Mgmt. Services 150,000 barrels 18 Nov-02 Tank Barge Option Vessel Mgmt. Services 150,000 barrels 18 Tank Barge Option Vessel Mgmt. Services 150,000 barrels 18

Bollinger Shipyards (Lockport LA)

Tank Barge Firm K-Sea Transportation 80,000 barrels 13 Jul-02 Tank Barge Firm K-Sea Transportation 100,000 barrels 16 Nov-02 Tank Barge Firm K-Sea Transportation 80,000 barrels 13 Mar-03 Tank Barge Firm K-Sea Transportation 100,000 barrels 16 Jul-03 Tank Barge Firm Bouchard Coastwise 110,000 barrels 17 Jun-03

Tank Barge Firm Bouchard Coastwise 135,000 barrels 18 Jun-04

Halter Marine (Gulfport MS)

Tank Barge F 309 Vessel Mgmt. Services 150,000 barrels 18 Aug-02 Tank Barge Option Vessel Mgmt. Services 150,000 barrels 18 Tank Barge Option Vessel Mgmt. Services 150,000 barrels 18 Tank Barge H 287 Undisclosed 80,000 barrels 7 Oct-02

NASSCO (San Diego CA)

Crude Carrier 484 Alaska Tanker Co. (BP) 95,000 185,000 dwt 210 4Q 2003 Crude Carrier 485 Alaska Tanker Co. (BP) 95,000 185,000 dwt 210 4Q 2004 Crude Carrier 486 Alaska Tanker Co. (BP) 95,000 185,000 dwt 210 4Q 2005 Crude Carrier 487 Alaska Tanker Co. (BP) 95,000 185,000 dwt 210 4Q 2006 Crude Carrier Option Alaska Tanker Co. (BP) 95,000 185,000 dwt 2007 Crude Carrier Option Alaska Tanker Co. (BP) 95,000 185,000 dwt 2008

SENESCO (North Kingstown RI)

Tank Barge 23 Barges Unlimited 80,000 barrels 7 Jul-02 Tank Barge Firm Unidentified 80,000 barrels 7 Nov-02 Tank Barge Option Unidentified 80,000 barrels 7 Mar-03 Tank Barge Option Unidentified 80,000 barrels 7 Jul-03

PENDING CONTRACTS

Type # of Vessels Customer Size Notes

Product Carriers 4 Keystone Tankers 45,000 dwt Pending Title XI

Product Carriers 2 AHL Shipping 45,000 dwt Pending Title XI

Crude Carriers 2+1 SeaRiver Shipping 100,000dwt

Chemical Carrier 1 Marine Transport Corp. 32,000 dwt Conversion of "Stolt Spirit"

Recent Legal News Coast Guard Announces NPRM to Change its Jurisdiction-Defining Regulations In the August 14, 2002, Federal Register, the Coast Guard announces a significant notice of proposed rulemaking to amend the jurisdictional terms in 33 CFR part 2 and other related federal regulations "so that their meaning conforms to existing law." The impact of this rulemaking stretches from the definition of "inland waters" for purposes of the Inland Navigation Rules Act, to what constitutes "navigable waters of the United States" for purposes of the Clean Water Act, a/k/a the Federal Water Pollution Control Act, recently addressed in Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers, 531 U.S. 159 (2001). Coast Guard's Chemical Transportation Advisory Committee to Meet October 8 & 9 CTAC will meet October 8 and 9, 2002, at Coast Guard headquarters in Washington, D.C. The agendas for each meeting, which appear in the August 15, 2002, Federal Register, include, among other items, "Discussion of steps that can be taken to increase public interest in Committee and subcommittee work" and "A presentation by Shell Chemical Company on vessel vetting systems and quality assurance issues." Coast Guard Sets September 26, 2002, Public Meeting on Potential New Rules on Salvage and Marine Firefighting Requirements and Response Plans for Vessels Carrying Oil. In the August 7, 2002, Federal Register, the Coast Guard announces an additional (fourth) public meeting in Louisville, Kentucky, on this Notice of Proposed Rulemaking first published in the May 10, 2002, Federal Register. The August 7 notice also extends the comment period on this NPRM to October 18, 2002. Coast Guard Looks for Comments on Proposed Changes to Rules On Foreign Lease-Financing of U.S.-Flag Vessels In the August 9, 2002, Federal Register, the Coast Guard publishes a Supplemental Notice of Proposed Rulemaking to solicit further comment on its previous NPRM entitled, "Vessel Documentation: Lease-Financing for Vessels Engaged in the Coastwise Trade." The regulations implement a 1996 federal law codified at 46 U.S.C. 12106(e), which was designed to enlarge vessel financing sources by allowing lease financing to be offered by companies which are less than 75% U.S.-owned. The notice explains the history of the 1996 law and the proposed regulations. Comments on these proposed regulations must reach the Department of Transportation's Docket Management Facility by October 8, 2002. (copyrighted 2002 Burns, White & Hickton LLC and used by permission).

Recent U.S. Corporate News ConocoPhillips has completed the merger of Conoco Inc. and Phillips Petroleum Company, following clearance by the U.S. Federal Trade Commission. Shareholders of both companies and all U.S. and foreign regulatory authorities cleared the merger earlier this year. ConocoPhillips is the third-largest integrated U.S. energy company. On a global basis, it is the sixth-largest publicly held energy company based on hydrocarbon reserves and production, and it is the fifth-largest global refiner with a net proved reserves of 8.7 billion barrels of oil equivalent (BOE), daily oil and natural gas production of 1.7 million BOE, and a refining capacity of 2.6 million barrels per day, and has assets of $75 billion. U.S. refineries and their crude capacity include facilities in Lake Charles, LA (248,000bpd); Ponca City, OK (184,000bpd); Denver, CO (58,000bpd); Billings, MT (59,000bpd); Linden, NJ (250,000bpd); Trainer, PA (180,000bpd); Wood River, IL (286,000bpd); Belle Chasse, LA (250,000bpd); Borger, TX; Sweeny, TX (213,000bpd); Woods Cross, UT (25,000bpd); Los Angeles, CA (132,000bpd); San Francisco, CA (76,000 + 44,000bpd); Ferndale, WA (95,000bpd) plus five refineries in Europe. Saltchuck Resources of Seattle, WA, has taken over operation and management of a number of barges previously operated by Newport Petroleum of Signal Hill, CA. The 70,000bbl, 9,995dwt, 328’ x 76’ OPA’90 double skin black oil barge “Cascades” built in 1993 and the sister barge “Kays Point” built in 1999 will be managed by Foss Maritime, while three clean product barges will be handled by Seacoast Towing. SaltChuck Resources, parent company of Foss Maritime, Hawaiian Tug and Barge and Seacoast Towing also operates Totem Ocean Trailer Express. Newport Petroleum, founded in 1991, focused on transportation of crude oil and petroleum products along the west coat of the U.S. including Alaska and Canada. In 1993, Marcon arranged the purchase of the 70,600bbl, 320’ x 64’ single skin black oil barge “E-67”, later renamed “N-67” from Eklof Marine. Newport Petroleum still operates on a limited basis, two tugs and two barges mostly in the California coastwise trade. Maritrans Inc. provided further insight into their expectations for the remainder of 2002 plus announced term contracts with its three largest customers through 2004. While Maritrans continues to believe its overall outlook remains positive, it is lowering its likely range of estimated 2002 earnings from ongoing operations to $1.00 - $1.50 per share from the prior anticipated earnings range of $1.50 - $2.00. Maritrans will also report higher maintenance expense for 2002 than was projected earlier in the year. To respond to worldwide marine safety concerns, customers have raised their vetting standards for all industry participants, in many cases above the standards set by the U.S. Coast Guard and the American Bureau of Shipping. Maritrans has been taking steps to meet those new requirements and also to meet increasing regulatory requirements for its fleet of 15 petroleum tankers and tug/barge units. Earlier in the year Maritrans anticipated an increase in spot market rates occurring in the latter part of 2002, but rates have remained relatively flat through August. For planning purposes the Company believes that the lower end of its revised estimated reported earnings range should reflect rates continuing at present levels through year-end. Maritrans believes that the current downward pressure on rates is caused by an unusually high level of refined products being imported into the United States as a result of lower international petroleum consumption and low international tanker rates. Demand for U. S. vessels has been reduced by the higher level of imports and the low demand for domestic jet travel, as evidenced by airline industry cutbacks. Maritrans' commitment to its long-term double hull rebuilding program may result in capital expenditures as high as $30 million in 2002 and may require additional borrowings under its existing revolving credit agreement. Capital expenditures are expected to be higher than in either of the prior two years, primarily due to the timing of rebuild payments and capitalizable improvements to its existing fleet. The barge “Ocean 252” and rebuilt tug “Navigator” were redelivered in the first quarter of 2002, and the barge “Ocean 250” and tug “Intrepid” are currently being rebuilt for expected redelivery in the fourth quarter. In addition, the Company is allowing for potential prepayments for future double hull projects. Maritrans' contracted business has remained solid for 2002, and the Company recently reached an agreement with Sunoco, Inc., to continue its exclusive lightering service for Sunoco's Philadelphia-area refineries through the summer of 2005. Substantially all of Maritrans' lightering service is provided through term contracts. Sunoco committed to minimum annual utilization that will result in revenue levels that are higher than in the past, and it will utilize Maritrans' vessels for any additional lightering requirements beyond minimum levels. With this agreement, Maritrans has contracts in

place with its three largest customers through the end of 2004. Maritrans expects that its three largest customers will generate nearly half of its revenues through 2004, although the contracts allow for some variance in customers' demand levels. Maritrans enters into other term contracts for its clean oil vessels to maintain its goal of keeping a significant portion of its vessel capacity on term arrangements. All of these term contracts are substantially above current spot market rates. Maintaining spot market availability allows opportunistic revenue during market peaks, flexibility in meeting variable term contract requirements and enables scheduled vessel shipyard periods to occur with a minimal requirement to charter in additional vessels. When a term contract customer elects to move only the minimum contracted amount of cargo, Maritrans has additional vessel capacity available in the spot market. These periods tend to occur when overall demand for petroleum is lowest, and the overall spot market rates are at lower levels than the Company's contracted rates. Approximately twenty percent of the Company's fleet has been working in the spot market over the past year. Maritrans’ fleet currently consists of four oil tankers and eleven oceangoing tug/barge units with an aggregate fleet capacity of 3.6 million barrels, with over half of its capacity double-hull. Danielson Holding (DHC) of Jeffersonville, IN reported net income of $4.3 million for the quarter ending 30th June compared with a loss of $5.6 million the second quarter 2001. The quarter included approx. one month of results from American Commercial Lines (ACL) and three related companies – Global Material Services, a network of marine terminals located on the major river systems in the U.S., Europe and South America and Vessel Leasing LLC, a subsidiary that leases barges to ACL – which were acquired by DHC on 29 May. These three companies, collectively referred to as “Marine Services” had a decrease of $20 million in pro-forma operating revenues the last quarter compared to the same period last year due primarily to a year-over-year decline in domestic barging freight rates, reduced volumes and lower marine construction revenue as a result of a strike, since settled, at Jeffboat, ACL’s inland shipyard which manufactures towboats and barges. ACL’s liquid cargo revenues were $25,571,000 for a total of 2,255,000 tons over the last quarter compared to $28,806,000 and 2,165,000 tons for the second quarter 2001. Year-to-date figures for liquid cargoes are $49,240,000 and 4,300 tons for 2002 compared to $54,615,000 and 4,250 tons for the same period last year. Hornbeck Offshore Services, Inc. reported that for the three months ending June 30th 2002, they had an average number of 16 tank barges with an average fleet capacity of 1,130,727BBL working with an average utilization rate of 73.9% at an average day rate of US$ 9,511. Average barge size was 70,670BBL. This compares to an average of 10 barges during the same period in 2001 with a utilization of 84.4% and average day rate of US$9,095 with an average barge size of 66,572BBL. Utilization is based on a 365 day year. Seabulk International reported revenues of $81.6 million the current quarter were down 11% from $91.4 million a year ago, due primarily to reduced demand and lower day rates for offshore vessels. "Strong results from our domestic tanker business and from international offshore operations, … were not enough to offset the weak Gulf of Mexico market, which peaked in the second quarter of 2001 and hopefully touched bottom in the quarter just ended," commented President and CEO Gerhard Kurz. "The bright spot in the quarter was our tanker business, where operating income rose 12% over the year-earlier period and 39% for the first six months of the year -- a trend we expect to continue for the remainder of 2002. Our focus on core assets led to the sale of the Port Arthur and Sun State shipyards and surplus offshore support vessels. Proceeds from these transactions were used mainly to pay down debt. Our strategy going forward is to complete the transactions announced on June 13, including the $100 million private placement of 12.5 million newly issued shares of common stock at $8.00 per share and a new bank credit facility of $180 million, which we believe will give us the financial flexibility to strengthen the fleet and generate future growth in earnings." Revenue from Seabulk Tankers, their domestic marine transportation business, totaled $29.7 million or 36% of total revenues versus $32.3 million in the second quarter of 2001. The revenue decline is primarily attributable to the sale of Sun State Marine Services subsidiary. Operating income of $7.3 million was up 12% from the year-earlier quarter as a result of higher average charter rates for the Company's fleet of 10 U.S.-flag, Jones Act tankers, which includes five modern double-hull vessels. Seabulk has five tankers operating under time charters of one to three years and a sixth tanker on a ten-year bareboat charter. A seventh tanker, which has been trading in the spot market, commences a three-year time charter in August with a major oil company. All ten product tankers are now fully employed under time charters or contracts of affreightment.

In July, Ingram Industries Inc. of Nashville, TN completed acquisition of Midland, a leading U.S. inland marine transportation company that includes The Ohio River Co. and Orgulf Transport. The proposed transaction had been announced January 24 between Ingram and Midland’s owner, Eastern Enterprises (now KeySpan New England), a subsidiary of KeySpan Corporation of New York. Midland’s history dates 1925 with the founding of The Ohio River Company. “This is a significant commitment to superior service for our customers who depend on our fleet of more than 140 boats and 4,100 barges,” Mr. Ingram noted. “It is also the strongest possible statement we can make about the importance of the inland water transportation industry and its future. This will enable us to bring excellent service

to a broader base of valued customers – in keeping with our tradition and Midland’s, too.” In addition to vessel ops through Ingram Barge, ORCO, Orgulf, R& W and Orsouth, Ingram will provide: harbor services in Kentucky, Missouri and Louisiana; marine terminal ops in Tennessee, Kentucky, West Virginia and Florida; shipyard operations in Kentucky; and midstream fueling at nine locations on the inland waterways. Kirby Corp. of Houston, TX announced lower second quarter 2002 results. Net earnings for the second quarter ending 30th June were US$ 8,756,000 compared with $10,764,000 for the 2001 second quarter. Joe Pyne, Kirby’s President and CEO, commented that “petrochemical volumes to the Midwest and along the Gulf Coast remain at depressed levels; however, this quarter we did see a marginal improvement in our Midwest volumes. Weaker Midwest volumes of refined products and liquid fertilizer more than offset this marginal improvement. Midwest inventories of refined products were high at the beginning of the second quarter and the demand was lower this year compared with last year. Fertilizer volumes during the quarter were very low. Significant rainfall in the Midwest during the quarter kept farmers out of their fields, reducing demand for fertilizer usage. Also, high water on the upper Mississippi, Illinois and Ohio Rivers in April and May and on the lower Mississippi in June, resulted in delays, increased transit times and forced us to use smaller tows.” Mr. Pyne further commented, “Although Midwest petrochemical volumes are continuing to improve, we are experiencing pressure on spot rates. We believe that demand is stabilizing, and we anticipate that petrochemical and fertilizer volumes will continue to improve during the third quarter. 2000 and 2001 were exceptionally strong years for our Midwest refined products business. We expect that refined products volumes will return to pre-2000 seasonal levels, but will continue to be affected by Midwest refinery outages and inventory balances…. Finally, we believe that the current market environment continues to be favorable for further consolidation of the inland tank barge industry.” Kirby operates the largest inland tank barge fleet with 875 barges comprising 15.5 million barrels of capacity. There are 212 inland towboats working 12,000 miles of commercial waterways. The fleet is aligned according to routes and services – Canal, River and Linehaul – as well as product carried including 741 clean petrochemical and chemical barges, 56 black oil barges, 60 pressurized barges, 11 anhydrous ammonia barges and 7 specialty barges. Kirby’s barges can handle a broad array of sophisticated products and include barges equipped with heating or refrigeration systems, high-capacity pumps, pressure tanks, stainless steel or aluminum tanks and special coatings. European News After steering failed, the 93m, 2250 ton vessel “Kaunas” built in 1957 and belonging to Volgaflot, sank within minutes Friday 16th August in 15m of water after striking the Liteiny Bridge across the Neva River in the historical center of St. Petersburg, Russia. This blocked fuel oil shipments to the Port causing shortages in products for export. The port, on the Gulf of Finland, usually receives its fuel oil shipments by rail and river barges during the ice-free season and then exports oil products to Western markets in larger vessels. The port was able to load cargoes from its on-hand storage, but stocks were running dry. Some 50

barges, each carrying 4,500 tons of fuel oil, were lining up on the river costing hundreds of thousands of dollars a day for shipping companies including abt. $4,500 a day demurrage per river barge. Estimate of total damages could run as high as $50 million. By the following Friday, the salvage team sawed off parts of the deck superstructure with a 150m cable attached between two tugs and dismantled parts of the vessel using a crane and barge to provide 4-5m clearance for vessels up to 5,000 tons displacement. At the time of the sinking, the vessel was transporting 2,000 tons of steel down the river to be loaded on another ship for export. The eight crew and two teenage passengers aboard the “Kaunas” were rescued by a tugboat. The 94.84 x 9.27 x 2.47m tank barge “Eiltank 3” enroute from Amsterdam to Vienna with 1.7 million liters of gasoline began to sink in a lock after two tanks holding 220,000L were torn open the end of August. The stern of the barges was protruding out of the water and about 30 – 50,000 liters of gasoline poured into the river. Due to the risk of an explosion, ship traffic on the river was halted and the fire service was pumping foam into the lock around the disabled vessel. Highlighted Listings TB13014 / 15 / 16 / 17 Inland Tank Barges (4 each) 147.5’ x 54’ x 12’ built 1975/75/73/75 respectively by Dravo Corp. G/NRT 812. U.S. flag. 13,338BBL in 6 coiled tanks. Double hull OPA’90 compliant boxes. Trading in asphalt & No.6 oil. 3.5/2.3/2.5/3.5 million BTU Hopkins Volcanic heaters resp. 2 loading stations P/S. ABS Great Lakes Limited Loadline. USCG Subch. “D” Grade “A” thru 7/05. 2100BPH 10” Byron Jackson screw / GM8V71 pump. 50kW generator. Prefer to sell “en-bloc” as unit-tow with TB26029 Inland Tank Barge 297’ x 54’ x 12’ built 1974 by Dravo. G/NRT 1641. ABS Great Lakes Limited Loadline valid for abt. 3 years. USCG Subch. “D” Grade “A” expires July ‘05. Abt. 26,022BBL. Coiled tanks. Double hull OPA’90 bow rake. Asphalt / No.6 service. 6 million BTU Hopkins Volcanic heater. 2 loading stations aft P/S. 2600BPH Byron Jackson screw / Cummins 400HP pump. 50kW Deco/GM3-71 generator. Price on request. File TB28375 Double Skin Ocean Tank Barge 275.0’ x 54.0’ x 17.5’ depth / 13.8’ loaded draft. U.S. flag. GRT 2210. Built 1980 by Omni Fabricators; Brownsville, TX. Double Ice strengthened Type III hull. Double rake. Skegs aft. Double bottom height 30”. ABS +A1 Oil Barge. Int’l Load Line. USCG Subch. "0" Grade "A" & Lower. Abt. 4236 ltdw. 28,664bbl in 10 tanks (5 P/S). 12 wing tanks. 2-3000bph (2100gpm) Johnston Deepwell / GM8V71 pumps. Self loading & pump-thru capabilities. 2 loading stations aft. Distillate petroleum, residual petroleum products & chemical service trading Great Lakes region. Designed and equipped to transit restricted rivers and harbors. All valves stainless steel trimmed. 2.5" Coils; 40:1 Ratio; Shore steam accessible. 1-20 KW/ GM2-71 generator. 4 Beebe deck winches. Brokers invite your best firm cash offers to test. Full details on internet. File TB28286 ex-Ocean Chemical Tank Barge 286.5’ x 52.5’ x 18’. @4424stdw on 13.6’ draft. Built 1973 by Jeffboat. Rebuilt ‘95 with reportedly $1.8 million spent renewing bottom, double bottoms, etc. U.S. flag. USCG “OD” Hull Type III Oceans, but not to Ports or Terminals under Jurisdiction of Foreign Countries

Signatory to MARPOL 73/78 when carrying petroleum. Drydock overdue 5/01. Needs steelwork & coatings. ABS Loadline exp. 8/2003. Double skin with three stainless steel center tanks. Void space surrounds center tanks for additional safety barrier. Vapor recovery. High level alarms and closed gauging. No.1 & 2 wing tanks zinc coated and No. 3 & 4 wing tanks Devoe Cathacoat 305. Center tanks, as well as pumps, valves and piping solid 308 stainless steel. 9 segregated systems. Tanks served by separate cargo pump & manifold. Small notch in stern. Double raked. Skegs aft. 500kW Marathon / GM12V92 440vAC 820A 3Ph generator. Keen sellers looking to sell outside of U.S. registry bulk petroleum or chemical trade. Prompt inspection / delivery U.S. Gulf Coast.

DB26088 Ocean Deck / Molasses Barge 260’ x 74’ x 13.6’. Built 1975 West Gulf Marine. U.S. Flag. ABS +A1. Loadline thru 2/05. ABS til 9/30/02. Special Survey No.5 done 2000. USCG COI valid to 2/2005. Drydocking outstanding. @3750dwt on 9.4’ draft. Molasses may be carried provided mean draft does not exceed 10’8”. Blackmer 100HP molasses pump. 150kW/GM8V71 generator for pump & 30kW/GM4-71 for ballast pump & lighting. Reported in over-all fair condition. Machinery reportedly good shape. Substantial internal steel repairs done in 2000 to complete ABS Special Survey. Copies of certificates on internet. Brokers invite best cash offers “as is, where is”.

TB52392 Pressurized Ocean Tank Barge / Tug 392' x 56' built 1971 Kelso Marine. U.S. flag. ABS+AI Pressure Tank Barge. Ocean liquefied gas carrier. Deep notch. Bludworth link. 2 long’l insulated pressure tanks. 6,036st liquid flammable gas at or below 100psi. Drydocked 5/01. Early 2001 cargo piping, valves & machinery stripped, re-built or renewed. Jan ‘05 OPA-90 retirement. Possible candidate for double-hulling as is fitted with diment coated void wing & end tanks. Condition reported excellent. Tug 100 x 34.8' built ‘79. ABS + A1 Towing Service +AMS (to 9/05). Raised foc’stle. 3-tier deckhouse plus raised pilothouse. 2 x Alco 16-251F total 5800HP. Priced now at US$ 3.6 million and close offers encouraged. Photos, surveys on website. As brokers only, we also welcome offers for either tug or barge separately.

File TB29999 30,000bbl Ocean Double Hull Tank Barge- ABS+AI Oil Barge: 259.7’ x 53’ x 22’ depth built by Wyatt Industries, Houston in 1967 to carry fructose corn syrup in tanks No. 2S, 4S, 3P, 5P. Stainless load/discharge piping & hydraulically pumped. Double hull tank barge with raked bow, square raked stern with skegs and shallow stern notch. Tanks framed externally on deck providing smooth interior tank surfaces and increasing tank strength to carry high density cargoes. 6 transv. & 3 long’l & partial long’l bulkheads form 10/5 cargo tanks, 5 each side wing voids, 2 stern rake compartments, bow rake port side pump room and bow rake stbd. side machinery room. Reported capacity 29,937 bbls. Centerline raised walkway. Cargo tanks with raised ullage openings & butterfly valves. No vapor recovery or electronic gauging. Pumping equipment includes GM4-71 with PTO to pump room powering 6” & 8” Blackmer cargo pump. 25hp & 40hp electric motors power fore & aft 6” & 8” dia pumps via shoreside electrical service. Periodic Special Survey No. 8 due Oct 2005; Intermediate Survey due April 2003; USCG COI Grade “A” & Lower & Specified Noxious Liquid Cargoes expires Nov 2005. Drydock due Sep 2004. Barge trading fructose, vegoil & lard and is not designated for OPA-90 compliance. No notation on Certificate of Inspection reference OPA ’90 phase out date. Barge is operational with cargo tanks empty and clean. Hull & machinery reported to be in good overall condition. Call for price. Further details including survey, drawings, certificates & photos on website. Inspection / delivery New Orleans.

TB99021 OCEAN TANK BARGE 562.75’ / 560.0’ x 90.3’ x 45.25’ depth of hull. G/NRT 16,660. @ 34,636ltdw. Light ship abt. 5,889LT. ABS +A1 Oil Barge. Int’l Load Line exp. 3/01. Class exp. 3/01. USCG Certificate Grade “A” & Lower. Drydock, internal inspection & cargo tank inspection overdue 10/99. @282,979 / 268,830bbl at 100%/95% in 8 tanks. 4-12” transverse loading & discharge manifolds. 4 cargo segregations. 4-4500GPM @ 350’ head Goulds 3 stage GM16V71 pumps. 8 mooring winches (4 P&S). 5 vertical capstans. 2–5T hose handling cranes with 40’ booms. . Anchor winch with 8,000# anchor on 2.75” chain. 5 port side mounted fender slides used in lightering ops with air winches. Dry storage below deck in bow rake and stern voids. 2

compressors. 1-30kW Lima/GM2-71 generator. Barge originally built as a tankship by Bethlehem Steel in 1956. Previous Owners acquired the hull and converted to deep notch tank barge (not fitted with articulated tug/barge connection) at Avondale in 1977. Barge was engaged in lightering operations and transport of residual fuels and crude oil along the Northeast Coast of the U.S. Barge is again available due to change in contract. As brokers, we invite best firm cash offers “as is, where is” for an immediate sale. Inspection U.S. Northeast by arrangement through this office. Price guidance & full details on request. Photographs & drawings on internet. TB10225 Ocean Tank / Deck Barge 250' / 238.56’ x 50' x 18.5' depth with 14.5’ loaded draft. built 08/1966 by Gunderson Marine; Portland, OR. U.S. flag. ABS +A1 Chemical Barge. ABS Class and International Loadline expire 6/2004. U.S. Coast Guard Certificate of Inspection Subchapter “D” and “O” cargoes expires 2/2005. 8 full transverse and 2 x12.5’ partial off centerline, 1 partial length and height centerline longitudinal bulkheads. "U" configured wing and double bottom voids isolate fore and aft center deep cargo tanks and eight cargo tanks from outer shell of barge. Double rakes (fwd. 43.5’ and aft 59’). 5' breakwater forward. Skegs aft. 7/16” deck plate, and 3/8” side and bottom plate. 3600dwt. Liquid Capacity: 10,285BBL in 8 tanks. Sodium chlorate (in tanks #2 & #3 port and starboard coasted with Plastite 4007), and caustic soda service. Also fitted with 4 x 300mt pressurized / cylindrical chlorine saddle mounted tanks mounted on 7/16” flat steel plate to deck. Six "Pump, Pipe & Power" (Mod#6-7C8-14L) 10hp/150gpm and two each Byron-Jackson electrically driven deep well tanks. One for each product tank with associated control boxes, pump houses, etc. Bilge system fitted to the non-cargo spaces, however system is currently out of service. 1-1000mt Danforth anchor. 50mt Beebe manual winch. The barge is located in the Pacific Northwest, and can be inspected promptly. As brokers we can guide on current price ideas. We would also invite all serious charter interests to forward proposals. Further details, copies of drawings, stability data, photographs can be obtained on request via this office, or by viewing / downloading via the Internet on our Website. TB75000 Single Skin Ocean Tank Barge 340’ x 90’ x 19.3’ built 1982 by Misener Marine and rebuilt / converted 1988. U.S. flag. Abt. 9570dwt. ABS +A1 Oil Tank Barge. OPA’90 retirement date 2015. G / NRT 4310 / 3517. Double rake. Clean service. Abt. 70,000bbl in 18 tanks. Three separate pumping systems with 3 Byron Jackson pumps. 100kW generator. Single drum mooring winch aft. Two 55’ hose handling cranes. Anchor windlass. Owner prefers long term charter, but may consider a partial sale of assets. Further details, rate ideas available on request.

File TB37627 Ocean Tank Barge 272’ x 68’ x 17’ depth with 14.25’ loaded draft. DWT abt. 5,369T. Built 1956 Alameda, CA and rebuilt in 1993. US Flag. ABS +A1 Oil tank Barge (SS passed 9/98). USCG COI valid. Single skin (OPA ’90 Date 2015) petroleum barge for refined products (diesel, gasoline, Jet fuel). Total 37,600BBL in 10 coated tanks (International Paints Interguard EXA Series HB). Two stern rakes serve as segregated ballast tanks 1,200LT total. Double block valves provide separation for all cargo tanks and manifolds. Below deck valves are controlled via hand wheels on deck. 1 long’l and 5 transv. bulkheads. Double raked. 2-10” Byron Jackson deepwell 1,500BBL./hr. (total) cargo pumps each driven by GM 6-71 diesel. 1-3” stripping

pump. 2- Hydraulic cranes (5T each port and starboard). Anchor windlass and 6,000# anchor. 4-50T wire mooring winches. 1-75kW / GM6-71, 460v powered generator set. All diesel machinery located forward in deck house. 4-20’ containers on stern with spill recovery and oil spill containment equipment and supplies, miscellaneous parts and supplies, and small office space for tankermen. Owners reportedly invested $600,000 during last dry-docking for special survey which included a complete and comprehensive external coating system including blasting and coating the deck and all above deck structures (Aug. / Sept. ’98). Previously (late 1990’s) used in service for US Navy in the Far East. Most recently the barge was employed in the Pacific NW. Owners are keen to sell the vessel and as brokers we would encourage firm / cash offers to test – basis ‘as is, where is’. Call for price guidance. Barge currently idle in U.S. Northwest. Photographs & drawing available on the website.

Copy of Fall 2002 Marcon International Newsletter now available in .pdf format on the internet at www.marcon.com

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Details believed correct, but without guarantee. Offered subject to availability.