Maritime News and Comment

February 2006

   K-SEA ORDERS ANOTHER FROM BOLLINGER.  K-Sea Transportation has ordered a fourth 100,000-barrel tank barge, to be called DBL-104, from Bollinger Marine Fabricators, in Amelia LA, for delivery in 2006.  Read Bollinger's press release here.  February 28, 2006.

   BAY AND EASTERN TO BUILD TWO FOR U.S. SHIPPING.  U.S. Shipping Partners has ordered two 160,000-barrel tank barges from the Bay Shipbuilding division of Manitowoc Marine and the tugs to go with them from Eastern Shipbuilding.  The contract with Manitowoc has two options and that with Eastern has four.  The price is said to be about $65mm each and deliveries are scheduled for August and November 2008.  Now that makes a lot more sense than the SENESCO deal.  Why could they not have done something like this the first time?  February 22, 2006.

   OPPOSITION TO DP WORLD IS ABSURD.  The political posturing by Senators Schumer and Clinton, of New York, and Lautenberg and Menendez, of New Jersey, over the acquisition by Dubai Ports World of what's left of the once great P. & O. Steam Navigation Co., which operates a container terminal in New York Harbor, among other major ports around the world, would be racist if it were not so absurd.

(1) They're a bit late.  This deal has been in the works for months. 

(2) We're not talking about port operation, we're talking about terminal operation.  There is a difference.  A port authority is concerned with security in the broad sense.  The operator of a container terminal can assume that each ship has been cleared by the U.S. Government before it arrived and that each container on that ship was cleared by the U.S. Government before it was loaded.  That's how it's done these days.  The terminal operator still checks each box as it is unloaded to make sure it doesn't raise a warning flag for any reason, as he does each container coming in from the land side.

(3) Is acquisition of P. & O. by a company based in the U.A.E. any better or worse than acquisition by a company based in Singapore, such as the Port of Singapore Authority, which was the losing bidder for P. & O.? 

(4) In case they hadn't noticed, two of the six container terminals in New York Harbor are operated by a Chinese company.  That's not a problem?  It's not so long since a bunch of equally ignorant members of the Congress were getting excited about a Chinese company operating a terminal in Long Beach, or about another Chinese company operating a terminal at the Atlantic end of the Panama Canal ("The Chinese Army has taken over the canal", shrieked one senator, who shall remain nameless but whose name is not Little.)

(5) Why would anything down at the waterfront change?  It's the ownership that has changed, not the operating management.   If the Ruler of Dubai were to buy the New York Times, do you suppose that it would suddenly become a mouthpiece for Al Qaeda?

(6) In this connection, it's ironic that Bushie's nominee for Maritime Administrator, a King's Pointer, happens to be an employee of Dubai Ports World.  It's also ironic that Bushie's Secretary of the Treasury, John Snow, used to be Chairman of CSX Transportation, which sold its container shipping company, Sea-Land Service, to Denmark's A. P. Moller and its overseas terminal operating company to, guess who, Dubai Ports World.

(7) If they are worried about foreign control of U.S. container terminals, why are they not worried about foreign control of the container ships that carry U.S. trade?  Or of U.S. terminals in general and of the ships that carry U.S. trade in general?  Or is this just another convenient stick with which to beat Bushie?

(8) If companies from the U.A.E. are to be banned from investing in the U.S., will the senators stand idly by if companies from the U.S. are banned from investing in the U.A.E.?  Not that that's too likely: the rulers of the U.A.E. are a lot smarter than New York's senators.

Why don't these nitwits make sure that they are properly briefed before they make asses of themselves in public? 

Sit down and shut up.  February 19/22, March 3, 2006.

   GUNDERSON TO BUILD TWO FOR CROWLEY.  Crowley Maritime has ordered two large oceangoing deck barges from Gunderson Marine, of Portland, Oregon.  Each will be 400 feet by 105 feet beam and will be employed in the offshore industry in the Gulf of Mexico.  No indication of the price: the first barge is to be in service in "early 2007", which means that this deal has been in place for a while and the barge is already under construction.  Read Crowley's announcement here.  February 19, 2006.

   AMO OFFICIALS PLEAD GUILTY.  Former American Maritime Officers' leaders Tom Kelly and Jerry Joseph pled guilty in federal court in Florida last week to charges of embezzlement of union funds and mail fraud.  They are expected to testify for the Government in the upcoming prosecution of Michael and Robert McKay, the current AMO President and Secretary/Treasurer.  February 15, 2006.

   BRASWELL SELLS PANAMA SHIPYARD.  Rumor has it that Astilleros Braswell, the full-service ship repair yard at the Balboa end of the Panama Canal, has been sold to one of its customers.   More to come, no doubt.  February 15, 2006.

   OGLEBAY NORTON SELLS "RESERVE".  Oglebay Norton has sold the 53-year-old laker "Reserve" (Great Lakes Engineering's hull # 299) to K & K Warehousing, the same company that bought the "Buckeye" from them last year.  The price was $4mm.  K & K will convert the "Reserve" to a storage barge.  Read Oglebay Norton's announcement here.  February 14, 2006.

   MORAN ORDERS TWO MORE FROM BAY.  Moran Towing has ordered two more 120,000-barrel tank barges from Bay Shipbuilding, for delivery in 2Q 2007 and 2Q 2008.  Read Manitowoc's announcement here.  February 7, 2006.

   ATWOOD SIGNS LOI WITH AMFELS FOR JACKUP.  Atwood Oceanics has executed an LOI with AMFELS for a Super 116-C , for delivery in Sep-07.  Read Atwood's announcement in the News Releases section of their web site, here.  AMFELS now has seven jackups to build: together with the three at LeTourneau and one at Signal, the offshore recovery is picking up!  February 7, 2006.

   NORTHROP GRUMMAN'S CURIOUS ARITHMETIC.  The USS "Forrest Sherman", (DDG ), was commissioned last week in Pensacola, and several speakers paid well-earned tribute to the Ingalls workers who built her.  Read the NG press release here.  It is interesting to read the quote from the fearless leader of Northrop Grumman Ship Systems, Phil Teel, which I reproduce here:

"Forrest Sherman represents the culmination of the art and expertise of building our nation's surface combatants," said Phil Teel, president, Northrop Grumman Ship Systems. "They have no peer in the world -- not even close. Today we build this ship for 55 percent of the cost of the original -- a far more capable ship for about half the price. This kind of stability empowers U.S. industry to give its best -- and we have."

A little hyperbole on a special occasion, such as a commissioning, is to be expected, but "half the price"?  Did the Public Affairs department slip this in while Phil was off playing golf or what?  The contract prices for the 28 ships of this class awarded to Ingalls are shown below.  The price for the latest in the series is almost 200% more than that for the first.  Even if you were to inflate the price for the first ship at, say, 3% a year, which would be very generous, the price for the latest in the series is still about 70% more than that for the first.  Part of this extra cost is undoubtedly attributable to the ever more complex combat systems, but it's still a long way from 70% more to 55% less.  And the quote is "about half the price", so he's not talking about manhours alone, or some other subset of the total.  My tiny mind is baffled, an increasingly common occurrence when wrestling with defense issues.  Perhaps someone can explain this 55% figure to me.

And isn't that bit about "They have no peer in the world -- not even close" a bit of a cheap shot?  The guys up at Bath have been building destroyers for a lot longer than Ingalls, are currently building them for much the same cost/price as Ingalls and, from the reports I'm receiving, are building better-quality ships than Ingalls.   Hyperbole's OK on occasion but let's try to stay on the same planet.  February 4, 2006.

   SEABULK PRIDE REFLOATED.  The tanker "Seabulk Pride", which grounded off Nikiski two days ago after spilling a horrifying five barrels of HVGO, has been refloated and has continued on its voyage.  Read the Coast Guard's latest bulletin here.  February 4, 2006.

For links to comment on earlier maritime news, please go to News and Comment

If you have comments or questions, suggestions or complaints, please e-mail me.