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Business model: Freeport Mid-Ocean Port/Harbor

Home Forums Research Business Business model: Freeport Mid-Ocean Port/Harbor

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    Profile photo of flash3780

    Business model: Freeport
    Mid-Ocean Port/Harbor
    Commercial shipping is a worldwide, $380 billion dollar industry involving the transport of bulk cargo, finished goods, petroleum, and many other products between producers and buyers. Commercial ports derive profit by providing safe harbors for ocean-going vessels and means to exchange those goods. Seaports without trade restrictions, and with low
    docking costs are in great demand (See Figure 1).

    What’s more, most seaports around the world are operated relatively inefficiently by governments, which provides a market opportunity for a private, extra-national seaport community to facilitate safe-harboring of ships and the transfer of goods between producers and buyers. Maintaining good relations with worldwide governments will allow a privately run seaport to act as an intermediate shipping destination between countries. A free, deep-water seaport would provide shelter from storms and fuel for merchant vessels. Additionally, a free seaport will act as a de-facto trading post for commercial traffic, and will provide opportunities for light manufacturing and other industries without the high tax burdens which may be found in other countries.

    Part 1: Engineering Constraints and Feasibility
    Perhaps the largest obstacle to overcome when planning a deep-water port are engineering challenges. The sea is a harsh
    mistress, and waves and storms must be considered in any deep-water port design. The Seasteading Institute has considered
    many concepts for permanent offshore structures. Perhaps the most promising requires the use of floating breakwaters to
    dampen wave forcing, and is a seemingly cost-effective way to protect buildings from environmental challenges.

    The primary advantage to a seaport business plan over other deep-water structures is that the primary technical challenge which must be overcome to build an offshore structure also becomes a large part of the project’s marketability. The approach considered here involves the creation of a flexible web of floating concrete breakwaters. The breakwaters serve to both greatly reduce wave forces on structures, and to provide a floating island which people may inhabit. The tenants of a floating breakwater/artificial island port must be as follows:

    1. The port must be of a robust, low-maintenance modular construction The port must be constructed in such a way that damaged components must be easily replaceable or repairable.

    2. The port must be expandable Due to economic constraints, it is unlikely that a port on the scale of the world’s largest
    seaports may be constructed in a single phase. The port design should be such that it may be able to service smaller ships at a relatively low cost, yet may be expandable such that it may provide a safe-harbor for large ships with additional investment. As the population of the port grows, the design should be able to accommodate additional structures.

    3. The port must be inexpensive In order to compete with commercial seaports around the world which do not have the burden
    of being built on the sea. Luckily, trade tariffs and taxes may be considerably lower for an offshore seaport, yet construction costs are likely to be considerably higher.

    4. The port must be accessible In order for the port to be used, it must reside along highly trafficked shipping lanes.
    Engineering considerations must effectively deal with the environmental challenges that are present in these locations.

    5. The port must accommodate traditional building techniques for structures To limit the technical challenges associated with building a floating seaport, the design should be such that once a floating foundation is constructed, traditional building techniques may be used to create structures.

    Many Seasteading concepts, though well thought out, are unable to meet these criteria, and are better suited for implementation in or near an established offshore colony. Perhaps the best option involves the construction of an island of modular, flexibly-linked floating concrete wave-breaks. Such a structure may be expanded, and should reduce wave-forcing on structures which it is built on. The outermost ring of the artificial island will be subjected to the most severe wave forcing, but as one moves inward the artificial island becomes less subject to wave forcing. The intent of such a design is that there would be a “constructable zone” at some distance from the edge of the artificial island structure which is not
    significantly subjected to wave forcing (see Figure 1). In this region, conventional buildings may be constructed on floating, ballasted foundation elements. These spar-like foundation elements would be required to carry far more load than the concrete wave-breaks.

    Essentially, the engineering challenge becomes reduced to constructing a floating platform which can attenuate ocean waves and serve as a foundation for conventional buildings. If this approach is selected, the three major required innovations
    may be categorized as follows:
    1. An interlinked flexible platform for providing inhabitable surfaces and for protecting ocean-
    going ships from ocean waves. The platform must also sufficiently attenuate ocean-waves to
    protect structure foundations from wave forcing.
    2. A mooring system for deep-water installations, which tethers the platform in place, yet allows
    sufficient movement.
    3. A floating building foundation system, which allows for the construction of traditional
    structures using standard building materials.

    Engineering Challenge: Wave Forcing

    The design of floating breakwaters is a difficult fluid-structure interaction problem, which is critical to the demonstration of the feasibility of a flexible floating structure concept. This challenge is illustrated in Figure 3; the number of modular breakwaters required greatly impacts the feasibility of the project. Several resources exist for the design of floating breakwaters, however computational fluid dynamics are likely necessary to predict the performance of a particular design.

    Engineering Challenge: Deep-Water Mooring

    Apart from constructing a platform capable of attenuating
    large ocean-waves, maintaining the position of the floating platform is likely the second most difficult
    challenge to overcome. Two obvious approaches to maintaining the floating platform in a fixed location are
    mooring the structure to the bottom of the ocean, and controlling the location of the platform with motors. The
    first approach is likely the simplest, so that will be investigated here. Note that the difficulty of deep-water mooring is related to the depth of the ocean where the platform is located. For the purposes of engineering studies, an ocean-depth
    of 6000 meters or about 3¾ miles.

    Political Considerations

    Clearly, there are political considerations when creating an open-ocean port without ties to existing
    countries. A legal system is necessary for dealing with criminal and property disputes. This system
    should be constructed such that it maintains good trade relations with as many governments as possible,
    while maintaining free trade and thought within the port.
    In the interest of creating a more efficient seaport, governance costs should be kept to a minimum. The
    details of such a system are beyond the scope of this document, but the following tenants apply:
    1. Maintaining free trade is paramount.
    2. Individual liberty breeds prosperity and innovation..
    3. Individual property rights must be protected.


    Though this study is preliminary, it suggests possibilities for creating a deep-water seaport, while laying out some of the engineering challenges. The sheer volume of commercial shipping in today’s world suggests that there is a great need for additional ports to service these ships. By limiting the scope of the technological effort to creating a platform on which traditional buildings may be constructed, the effort has a much higher chance of success. Further study of deep-water seaports is suggested.

    PS I have illustrations to go along with this concept, but I wasn’t able to figure out how to upload them.

    Profile photo of nicolas1776

    If those problems had a realistic chance of being solved (and funded) we could build a whole new nation (in no way limited to a sea-port). I see this as much more suited to a generic self governed island adding businesses and residences organically as needs arise. I’m not sure why the emphasis is on producing a sea port, except as a support to local island industries.

    I can’t really wrap my head around this concept. Why would a shipping company want to make its ships stop in the middle of a shipping route… doesn’t the cargo have to somehow keep going to reach land?

    If the idea is to have a floating refueling area… this might work but I’m not sure such an investment would be warranted (a fleet of refueling ships might be more cost effective, easier to run and faster to set up incrementally).

    If the idea is to have a repair yard at sea… the additional technical challenges seem even more difficult to overcome and the cost advantage minimal (if any).

    If the idea is to have industries take in raw materials and ship out finished goods, then the focus isn’t really on building a generic port anymore (back to a more generic self governing island with specific industries funding it at first but no specific emphasis). There are also other options in this case such as factory ships taking in raw materials in one country and building finished goods while underway to the destination… whether any of this is cost effective or even doable remains to be seen of course and depends on the products being considered.
    Not sure if I’m missing something obvious here.

    I’m not sure I understand the competitive advantage and only see this idea taking off in the context of serving a whole startup nation. If the technical challenges you laid out can be overcome, a multi-purpose business park with its port, residences, industries and entertainment areas can be built. The port is quite secondary to this central idea in my mind. As it stands, I don’t see how you would get the shipping industry to be your first customers.

    Note: I understand the need for new mega-ports near (not far from) huge population centers with no deep water natural or artificial ones… or even pre-screening or customs areas to keep bombs and such out… but this is outside the scope of seasteading and self governance at this point.

    I would definitely love to see the engineering challenges being solved in a cost effective manner. No doubt there would be plenty of funding for it as the possibilities are endless.

    Profile photo of flash3780

    The real niche here would be refueling merchant ships. It would allow ships to carry more cargo per trip, and smaller ships to travel in long-distance shipping lanes. I think that this represents a significant economic advantage to shipping companies; the more weight that they have to carry as fuel, the less weight that they can carry as cargo.

    Also, I could imagine a market for a hub in which ships could safely exchange cargo at sea. For example, a ship from China carrying mattresses could stop at a mid-ocean port and split up its mattress order between multiple mainland ports, shortening its time at sea. This would allow savvy shipping companies to deliver more goods with less time at sea.

    Yes, I definately think that this would be a springboard for an independant nation with secondary industries.

    I actually has illustrations to go along with the writeup above, but I wasn’t able to figure out how to upload them onto the new site.

    Profile photo of flash3780

    The real niche here would be refueling merchant ships. It would allow ships to carry more cargo per trip, and smaller ships to travel in long-distance shipping lanes. I think that this represents a significant economic advantage to shipping companies; the more weight that they have to carry as fuel, the less weight that they can carry as cargo.

    Also, I could imagine a market for a hub in which ships could safely exchange cargo at sea. For example, a ship from China carrying mattresses could stop at a mid-ocean port and split up its mattress order between multiple mainland ports, shortening its time at sea. This would allow savvy shipping companies to deliver more goods with less time at sea.

    Yes, I definately think that this would be a springboard for an independant nation with secondary industries.

    I actually have illustrations to go along with the writeup above, but I wasn’t able to figure out how to upload them onto the new site.

    Profile photo of nicolas1776

    1. I’m not sure this would make a whole lot of sense either. Case in point, this isn’t being done, despite the ease with which it could be implemented today (islands alongs the way, some of them right on huge shipping lanes). The fuel has to get from a refinery or processing facility to the seastead, and then from the seastead into the refueling customer vessel. I’m not sure about the taxes on this type of fuel (bunker fuel) but I doubt they amount to much.
    Why not use the tanker itself to refuel the ship (on busy shipping lanes, coordinating with a few vessels becomes easy and wastes little fuel for the refueling tanker, while not requiring container ships to stop). Such a setup would eliminate the required downtime at the seastead (which a ship unloading or loading cargo in port can afford to spend refueling, but which a ship underway and loaded cannot). Of course, it might be possible to find an optimal location, in the middle of a busy shipping lane and close to an existing petroleum field. This may just be cost effective enough… maybe.
    I suspect shipping companies have run the numbers and it still makes more sense to carry the extra fuel (and weight) for the second half of the trip. As far as I can tell, the extra fuel (let’s say for half the trip) doesn’t weight much compared to the total of the other half+cargo AND cargo ships are generally already loaded to the max (the limit being structural – both because of the containers themselves and the ship’s design – and not so much because of the weight of the fuel, which in any case isn’t in the same area). Adding more cargo with less fuel might even be dangerous for the ship. Specially designed ships may be required to take full advantage of the seastead’s presence. The shipping industry seems geared toward making bigger and bigger vessels which generates much greater fuel and time savings than anything else. I hardly think a refueling seastead can bring the cost of fuel for the second half of the trip low enough to be worth the stop, while still making a profit.
    But as fuel costs rise, this may become advantageous given an absolutely optimal position for the seastead… this remains to be seen however, and refueling ships may be deployed by shipping companies before then (if this makes sense at all).

    2. The splitting of cargo (or cargo exchange) seems more promising but competition with land routes will vastly reduce the number of shipping lanes where this makes sense (if any are left at all). It may still logistically make more sense to send the whole order to one port and use trucks and trains to deliver to secondary ports (or more likely directly to the end destination which is not the port itself). I’m not sure this would save much. You are essentially replacing one big ship making a long journey with the same big ship and 2 others, all making a shorter journey. It will rarely make sense to do that, except when the destination ports are the end destination of the goods and the savings are also somewhat lessened by the need for 3 crews (negligible) instead of one, extra fuel costs and the extra unload/load operations (time and handling costs), making it interesting for only the longest routes. Some smaller ships might avoid retirement this way though. Of course, it now makes sense to also refuel the ships (#1) while loading/unloading at the seastead, which is why this option has a better chance than #1 alone.. but still a slim one.

    3.Why not simply target medical research centers, aqua farms and other businesses benefiting from a permanent presence with low taxes and regulations? Once you have attracted enough, a somewhat large port will be needed, and can be expanded to serve both #1 and #2 by piggybacking on the existing business… not the other way around (which I think has a slim chance to happen).

    Food for thought: container ships from Asia still go through the inefficient Panama canal to reach ports on the US east coast and only use West coast ports or intermediary facilities when they can’t squeeze through. They are talking of making the canal bigger to make things more efficient and allow bigger ships in. They aren’t talking about using smaller ships to ferry cargo from the canal to East coast ports while the main ship goes back to China or Japan. I suspect the giant ships are just that efficient. I am also unsure whether they even bother to refuel while waiting to enter the canal. I’m not sure if shipping companies are using Hawaii for either #1 or #2 either. This makes me quite cautious.

    Profile photo of flash3780

    To address a few of your points:
    1. Why aren’t new ports being built on small islands along shipping lanes?
    This is probably the most difficult to answer. Partly, this is due to the fact that many governments like to own or control all of the ports in their countries. That said, perhaps it’s a dry-land market opportunity that hasn’t been realized.
    2. Why not simply refuel boats from a tanker ship.
    That may be another business model, however the logistics become much more complicated. You’d have to coordinate with shipping companies to refuel their boats along their routes. The risk on their end is also much higher, since there’s a chance that your tanker doesn’t show up a the appointed time or place. Things are a lot simpler for a port with a fixed location. Essentially, customers come to you rather than you going to them.
    3. Adding more cargo and less fuel could be dangerous for the ships…
    True, ships use fuel as ballast; they also replace the fuel with ocean water as it is burned. So, yes, ships would have to be designed differently to carry more cargo and less fuel. That said, the seastead port could be readily applied to small-to-midsized ships which might not otherwise be equipped to safely make longer voyages, or who may wish to steam to their destination faster (i.e. burn more fuel) if there is a refuelling station along the route.
    4. Why not simply target medical research centers, aqua farms and other businesses…
    You don’t go to the moon to invent velcro. Likewise, you wouldn’t build a city out in the ocean to start a business which doesn’t require you to be in the middle of the ocean. Those are great businesses which might very well pop up in an offshore community given that the costs and political environment is favorable. But I can’t imagine building an offshore community to house those businesses which could just as easily be developed on dry land.
    The technical risks are much lower if you were to choose a country with lower tax burdens to build medical research centers or aqua farms on or near dry land (eg. the Cayman islands, the Isle of Mann, etc.). There are quite a few countries on earth which would love the foreign investment.
    The advantage to building a mid-ocean port is that the purpose of taking on the technical challenge is directly tied to the financial reward. A mid-ocean port would benefit from being built at sea, since you could objectively locate it exactly where it’s needed.
    It should be noted that in order for the project to be successful, management with contacts and experience within the merchant ship industry would have to build the connections necessary to ensure that the seastead is well advertised in industry circles. Before building anything, a market study would have to be done to determine whether shipping companies would be interested in the service. That said, my bet is that smaller shipping companies using small handysize ships or minibulkers would be interested.


    How about using a ramform harbor similar to Banff as a model for a mid ocean freeport (http://concretesubmarine.activeboard.com/t46994349/ramform-ship-island-as-ocean-base-mobile-stable-scaleable/)
    The Ramform triangular shape has been suggested for a aircraft carrier made out of ice – but it is only in the last years that real ships in ramform started to get in use .This flat triangular shape was already used for oceanic survey ships and stationary concepts like the Ramform Banff.But it has also be proposed for yacht concepts like the WHY yacht – to create a very stable wide hull that still can run at a reasonable speed.Other than a classic ship hull that really sucks when it stays stationary on the ocean, the ramform allows setting a stable base in open water. . . . What is interesting in the proposed “ice island” is the use of the wide aft section of the vessel for a kind of harbor – where a calm waterspace allows all kind of activity at the open ocean that would be difficult to develop in a wave ambient. Among those handling of heavy loads, diving, salvage, building and maintenance of structures etc.. . A floating base in ramform could be a blend between ship, harbor, marina, floating dock, combining all those elements like mobility and calm water spaces in one conceptMore about this theme in the axes of ocean colonization how to build a base on the waterHaving a “mobile calm deepwater harbor ” on the stern the ramform harbor base would develop all kind of commercial and industrial activities around that “harbor”On a small scale this could just be a A frame that allows to lift small boats for a quick paint job.On a larger scale this could be a drydock compareable to mighty servant.And on a even larger scale this could be a full sized marina or industrial harbor operation in open ocean along shipping lanes.As it is a triangular concept it could be developed as a concept that starts with a small triangle and keeps growing on the stern until it becomes a larger and larger triangle of almost unlimited size…


    . .

    Profile photo of Morganism

    Actually, if you are harvesting methane in the water column, or off the seafloor, you could use wave action to pump it down to CNG, and run your ships directly off that. No transport of diesel required.

    Here is the model for the floating drydock- forward base.


    Profile photo of Morganism

    Here is the wave shield. Can use tension tethers made out of the new, piezoelectric polymers.

    This is the wave reduction layout, would give you lots of mooring points, and water desalination sites.

    and here is the tether tech link- is posted over in the engineering section

    This would give you protection, flexibility, and electricity, all in the same platform. Could also be easily extended, or opened for access. If the tops were domed, would give you desalination setups without using up deck space.

    Profile photo of flash3780

    There are good and bad aspects of a ramform. One thing that I don’t like about it is, it’s not very expansible. Also, I believe that it has to be steered to face into the waves. I think that an ideal port would be at a fixed location, and could grow as trade at the port demanded it to do so.

    I think that what is necessary is a simple, protected harbor for refuelling merchant traffic.

    My thought is that a floating breakwater barrier around a floating, flexible platform would be the way to go (I haven’t settled on whether the breakwaters should be connected to the platform). The breakwaters would also provide safe harbor for customers. The area protected by floating breakwaters is proportional to the radius of the area protected squared, so it becomes much more economical as the you increase the size of your platform and harbor.

    As for buildings, the technology for building floating buildings, even larger ones, exists. From the link provided above:

    Video of floating building/base.

    So the technological leap would be to find an inexpensive way to attenuate waves and build a robust floating platform and harbor. It’s not terribly sexy, but it seems like a practical place to start, and I think that there’s a good chance of demonstrating a feasible business plan for a deepwater merchant ship port.

    Really, the last bit is the most important. If you’re going to ask people to invest in an offshore platform, you need to provide a clear path to how they might make a return on their investment. What’s needed isn’t a herculean technological leap (though some development is needed), but a well thought out business plan. If a floating port were successful, the return on investment could be huge. Hong Kong is an example of a very successful free-trading port, so there is precedent for such a place to be successful.


    What you say is true for a ramform ship – but not for a ramform harbor – the key feature is that the stern of the structure is a building site in progress – in permanent progress – so that the harbor grows with the business it handles. See the orthocone analogy (http://concretesubmarine.activeboard.com/t46994349/ramform-ship-island-as-ocean-base-mobile-stable-scaleable/) – the reason why a ramform is the most suitable is that you have a bow that allows you to deal with Draupner Events while the structure is relative small while your structure is small (and small means ship size in this context) you need a “hardened edge” to deal with the big waves that come in only 4 times a year (Draupner) in open ocean. Please check the video (http://concretesubmarine.activeboard.com/f542349/draupner-wave-freak-waves/) and imagine what would happen with a “bowless box structure” in this situation. If you don’t have a hard edge to point against such a wave – your harbor is gone…

    Profile photo of nicolas1776


    2. yes this is probably too risky and likely one of the reasons they haven’t been considering it.

    3. small and midsized ships may be a better target. Busy shipping lanes have enough frequency to not need smaller runs in between (rendering small ships uncompetitive regardless)… but perhaps less busy ones serving smaller and remote markets might benefit from it (although this is at the same time an issue in regards to profitability of the seastead). As to speed, cargo that is time sensitive is usually shipped by plane… and the market for won’t fit in a plane and can benefit from arriving a couple days earlier at a greater cost products may be quite limited.

    4. honestly, the sad truth is that there isn’t much today that requires the open ocean environment to be successful, and cannot be accomplished on a ship as it is. Most of the proposed businesses could be run just as well near coastlines subject to a pesky or rather permissive landlord state (you seem to agree many smaller states will happily create lower burden regulatory zones to accomodate such investment).
    Lower regulations and taxes… but more importantly, the SAFETY of LONG TERM, custom tailored rules (as opposed to ever changing laws and rulers) is in very short supply. In my view, the open ocean isn’t the enabler… the regulatory environment is (not just the taxes). The exodus of a few businesses will spell doom for the seastead operator… THAT is the true appeal of a seastead in my opinion… and it just happens to be sitting in deep water. Fickle rulers with fickle populations in long established large (or small) nations, can easily alter or abolish special privileges and special zones previous rulers agreed to, with little to no short term ill consequences on themselves.

    The port idea sounds great as it builds on location and regulation strengths. I’m just not convinced there is much of a need for it specifically. Hopefully you can figure out a niche that will make it work. Anything that opens the door to open ocean breakwaters and city development will get my full support regardless of the industry it was designed to serve originally.


    A port is a trading hub for a population center – so place it in mid ocean does not make much sense . What is needed in mid ocean is a BASE for deep sea mining ( http://concretesubmarine.activeboard.com/f542346/interesting-projects-for-ocean-colonization/ ) aquaculture, oil, gas production. (http://concretesubmarine.activeboard.com/f541915/oustanding-floating-concrete-structures/) – that such a base in the end might grow to a size where it takes over the function and size of a port and a population center might come true for the third or fifth generation of offshore bases – we are currently in the first generation …

    Profile photo of elspru

    could also do ship-repair, and offer retrieval and man-over-board services,
    if for instance someone has sank and is now on a lifeboat,
    or if someone has dis-masted and would like to be towed.

    Mostly though, any floating city would have to be self-sufficient,
    getting most of it’s food from nearby.

    Likely it’ll naturally form, after we have large amounts of floating ocean residences,
    they can simply inter-connect to form larger groupings like towns and cities.

    By my calculations with a boat as big as Noah’s Ark, can house 4,500 people aboard,
    which by itself is already a medium sized town.

    Most services that can be offered from a port, can also be offered from a properly outfitted boat.

    I know some of those japanese whaling ships, especially the “factory-ship” may be useful,
    it could haul small yachts onto a drydock and do repairs, wherever they may be.

    Of course as a mid-ocean-port one of the main attractants is likely to be eco-tourism.

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