Maritime News and Comment

June 2007

    SEACOR TAKES OVER SEAMARSeacor Holdings and Nabors Industries have announced the formation of a new company, SeaMar Offshore, to operate Nabors' Jones Act fleet.  Seacor will be the majority owner and manage the fleet: Nabors, which moved to Bermuda in 2002, raising questions about its Jones Act status, will own the balance.  The deal apparently involves only 20 of SeaMar's 25 OSVs: see the SeaMar fleet here.  Read Seacor's announcement here and Nabors' here June 29, 2007.

    GLADDING-HEARN BUILDING THREE FOR CIRCLE LINENew York's Circle Line has revealed that it signed a contract in November for the construction of three new boats by Gladding-Hearn Shipbuilding, in Somerset MA.  The boats are 165 feet long and carry 600 passengers: they will be delivered in 2008.  June 29, 2007.

    BOLLINGER TO BUILD 8 MORE CPBSThe Coast Guard has ordered eight more of its 87-foot "Protector"-class coastal patrol boats from Bollinger Shipyards.  Read Bollinger's announcement here.  This brings the series to 75 boats.  June 28, 2007.

    THE COAST GUARD RESPONDS TO THE SUNRead the Coast Guard's public statement here June 27, 2007.

    LPD 17 RE-INCLINED?  Reliable sources say that the misbegotten LPD 17 is to be re-inclined, or possibly has just been re-inclined.  Good grief!  How many changes have been made since her original inclining that a re-inclining is required, more than two years after delivery.  Whatever next?  June 27, 2007.

    K-SEA ACQUIRES SMITH AND SIRIUSK-Sea Transportation continued its seemingly never-ending growth yesterday, by buying Smith Maritime, of Honolulu HI and Sirius Maritime, of Seattle WA.  Read K-Sea's announcement here June 27, 2007.

    PHILLY DELIVERS OSG #2Aker Philadelphia Shipyard has delivered OSG America's second product carrier, the "Overseas Long Beach".  Read the shipyard's announcement here June 27, 2007.

    COAST GUARD JUDGES UNDER ATTACKCorrection: Yesterday's report inadvertently concentrated on the follow-up story.  Read the Baltimore Sun's original investigative report here.  (You may have to register to read it, but it's free.)  U.S. Representative Elijah Cummings, who is the Chairman of the Subcommittee on Coast Guard and Maritime Transportation, is planning to hold hearings to look into allegations that the Coast Guard's administrative law system is rigged in the Coast Guard's favor.  Read the Baltimore Sun's story here June 26, 2007, revised June 27.

    TWO MORE NEW SHIPYARDSWaterways Journal reports that two new shipyards have opened recently - Boatreidt Shipworks, in Fort Smith AR and McAlpine Marine Industries, in Louisville KY.  By my count, that makes exactly 40 shipyards that are building ships, boats and barges today that weren't five years ago.  Have these people never heard of business cycles?  The time to get in on this boom was at least five years ago: pretty soon it will be time to get out.  Very, very stupid behavior.  June 26, 2007.

    BULKER AGROUND OFF BRUNSWICK GAA Bulgarian-flag bulker, the 23-year-old, 24,000-dwt, 612-ft "Koznitsa", loaded with grain, ran aground while leaving the Port of Brunswick GA yesterday.  Read the Coast Guard's announcement here June 25, 2007.

    K-SEA GOES TO JEFFBOATK-Sea Transportation, which has built almost all its new tank barges at Bollinger Shipyards, has ordered four 50,000-barrel barges from JeffBoat, with options for four more.  Read K-Sea's announcement here.  The contract is valued at $40 million, with deliveries scheduled at three-month intervals between December 2009 and September 2010.  June 23, 2007.

    VT HALTER GETS FUNDS FOR EGYPTIAN FMC PROGRAMThe Navy has modified its contract with VT Halter Marine for the design of three Fast Missile Craft for the Egyptian Navy.  Read the DefenseLink announcement here.  This $41 million mod. is for long-lead-time material, most of it coming from Lockheed Martin, and brings the total amount funded for this contract to date to about $236 million.  The construction phase is scheduled to be funded in FY-08.  June 23, 2007.

    LETOURNEAU DELIVERS JACK-UPThe independent-leg, cantilever jack-up "Panuco" has been delivered by LeTourneau's shipyard in Vicksburg MS to the Mexican drilling contractor Perforadora Central.  June 21, 2007.

    TOWBOATS SINK AT PIERTwo towboats - the Miss Marjorie and the Amy Sue - sank yesterday at their moorings at the Valero refinery dock in Krotz Springs LA.  Read the Coast Guard's announcement here June 21, 2007.

    CREWBOAT BUILDER WINS YP CONTRACTThe Navy has awarded a contract for construction of two YPs to C. & G. Boat Works, of Mobile AL, a leader in the crewboat market sector.  Read the DefenseLink announcement here.  The contract is valued at $18.3 million, with completion by November 2010.  There's nothing in the announcement about options, but the Congress has authorized acquisition of four new YPs.  I'll bet that these YPs will be quite a bit different from the current ones.  June 21, 2007.

    AUSTRALIANS PAY A PREMIUMSometimes I focus on the familiar and overlook the real story.  The Australian Navy's announcement about its destroyer acquisition program was actually more notable for the price it's paying than for its choice of design.  AUD 8 billion - that's about USD 6.7 billion - for three ships?  That's a helluva premium to pay for propping up the Australian shipbuilding industry.  Wow!  Why don't they just buy three F100s from Navantia, or, better still, three DDG 51s from BIW?  And on top of this, the Australian taxpayers are apparently also planning to spend another USD 2 billion for two large amphibious assault ships (LHD).  I'm all for our allies increasing their defense budgets and playing a larger role in world affairs but I had never previously thought of the Australians as being such profligate spenders.  And, by the way, if these are the only major ships that the Australian shipbuilding industry, such as it is, is going to have to build in the next 10 to 15 years, then it's a sure thing that they will actually cost a lot more and take a lot longer than is currently anticipated.  June 21/22, 2007.

    US DESIGN LOSES OUT TO SPAINThe Australian Navy has announced that its new-generation destroyers will be built to the F100 design developed by Navantia, the Spanish shipbuilding group, rather than to a version of the "Arleigh Burke" (DDG 51) design.  Read the announcement here June 20, 2007.

    BP RELEASES ANNUAL REVIEWBP has released the 2007 edition of its "Statistical Review of World Energy'.  Download it, or selected bits of it, here.  As usual, it's impressive stuff, very well presented.  June 16, 2007.

    TODD DISAPPOINTSOn a day on which the market as a whole continued to do very well, Todd Shipyards' stock price was one of the few to fall, presumably because they announced their results for the fiscal year ending April 1 and those results were lousy.  Read their 10-K here.  Revenues down by 37% from last year, operating profit essentially zero, net income only 2% of revenues.  Not very good when you consider how well the industry as a whole is doing.  June 16, 2007.

    WSF BIDDERS TEAM UPThe folks in the Washington State government must be masochists.  Having cut off one of their hands by restricting the competition for the construction of four ferries for the Washington State Ferry system to shipyards located in Washington State, they have now cut off the other by allowing the only three qualified shipbuilders to team up and submit a single joint bid.  After all, who needs competition?  It only gets in the way of the real goal, which is, of course, poor value and lousy quality.  How stupid can you get?  Read the WSF announcement here and note the idiotic statement from its Executive Director.  June 14, 2007.

    TWO MORE FOR SCRAPMARAD has sold two more NDRF ships for scrap.  One is the "State", better known as the Fort Schuyler training ship "Empire State V", which was built in Camden NJ in 1951, by New York Ship, as the "President Jackson".  The other is the "Cape Clear", which was built in Sparrows Point MD in 1963, by Bethlehem Steel, as the "Mayo Lykes".  Read MARAD's announcement here June 14, 2007.

    OSG SELLS US-FLAG BULKEROSG has sold the US-flag bulker "Overseas Marilyn" to Sealift, Inc., for $10 million.  Sealift, which bought the sistership "Overseas Harriette" six months ago, has renamed her "Marilyn".  June 13, 2007.

    OSG SELLING TANKERS TOO?  OSG has sold the single-hull tanker "Perseverance" (ex-"Philadelphia Sun") for scrap and is said to be close to selling her sistership "Allegiance" (ex-"New York Sun").  June 13, 2007.

    THE HOLLY AND THE SAGEThe New York Times revealed today the saga of two elderly Coast Guard cutters, "White Holly" (originally built in 1944 by Basalt Rock as YF 341, later WLM 543) and "White Sage" (originally built in 1944 by Erie Concrete & Steel as YF 444, later WLM 544).  Our inimitable Congress directed the Coast Guard to donate these two ships to a "faith-based initiative" called Canvasback Missions, to be used for humanitarian purposes in the South Pacific.  Canvasback Missions, however, sold them for cash, $425,000 in total.  One of them is now a ferry in Nicaragua and the other a research vessel based in San Francisco.  It's only money.   June 13, 2007.

    AMSEC TO BE SPLIT UPNorthrop Grumman and SAIC have agreed to split AMSEC into two parts, with NG keeping the naval side, which includes once-great naval architects, M. Rosenblatt & Son, and SAIC keeping the rest.  Read NG's announcement here June 12, 2007.

    SECOND OSG TANKER COMPLETES TRIALSThe second of OSG America's series of product carriers, "Overseas Long Beach", has completed its sea trials with a "clean sweep" and will be delivered later this month.  June 12, 2007.

    RABAGO IN DEEP WATERThe Commandant has appointed RADM Ronald J. Rabago to run not only Deepwater but all the Coast Guard's acquisition programs.  Another good decision.  Read the announcement here June 8, 2007.

    TOWBOAT AGROUND NEAR CAIROThe towboat "Cindy L. Erickson" - built by Nashville Bridge in 1962 and operated by Marquette Transportation - grounded near Cairo IL yesterday and lost its 20-barge tow.  Read the Coast Guard's announcement here June 8, 2007.

    ANOTHER $398MM FOR DDG 1000The Navy has modified its existing contracts with NGSS and BIW to provide an additional $398 million for long lead material, production planning labor, integrated logistics support, and systems integration engineering of the DDG 1000.  Click here and here to read the announcements on DefenseLink.  Prior to this, the Navy had already committed $1.168 billion to this effort, not counting what they had previously spent on its failed predecessor programs, known as DDG 21 and DD(X).  June 6, 2007, expanded 6/12.

    THE FRONT FELL OFFThis isn't exactly a news item - it's a video on YouTube - but it's well worth watching and in a twisted way it actually contains a message for the maritime industry.  Click here.  This video, starring satirists John Clarke and Brian Dawe, originally appeared on Australian television, shortly after the "Kirki" accident.  To read more about the "Kirki" accident, click here June 5, 2007, expanded June 9.

    SYNOPSIS OF RFP ISSUED FOR FRC PROGRAMThe Coast Guard has released a synopsis of the RFP for the restructured FRC program.  Read it here.  The RFP itself is scheduled for issue on June 22.  June 5, 2007.

    BOLLINGER DELIVERS DBL 104Bollinger Marine Fabricators has delivered another double-hull tank barge to industry leader K-Sea Transportation.  The new barge, "DBL 104", is that company's fourth in the 105,000-barrel size category.  June 5, 2007.

    $2.4 BILLION FOR LHA 6The Navy has modified its existing contract with No Good Ship Systems for the design and construction of LHA 6.  The original contract, awarded in July 2005, provided $110 million for initial studies.  This mod provides $2.4 billion for detail design and construction.  LHA 6 - formerly known as LHA(R) - is supposed to be a modified version of the LHD 8 design, although even that extremely expensive ship didn't come close to costing $2.4 billion, and will be the first of five ships that will replace the 30-year-old "Tarawa" (LHA 1) class.  Completion is supposed to be by the end of August 2012.  Read the announcement here.  Note that the work is to be split 95/5 between Pascagoula and New Orleans: another indication that it's goodbye, Avondale.  I have no doubt that we will have more to report on this project as it progresses.  In the meantime, see the table below for the shipyard's past performance on LHAs and LHDs.  June 2, 2007.

Pennant # Name Original Contract Price ($mm) Contract Keel Launch Delivery Keel to Delivery (months)
LHA 1 Tarawa 112.5 1-May-69 15-Nov-71 1-Dec-73 14-May-76 55
LHA 2 Saipan 112.5 15-Nov-69 21-Jul-72 18-Jul-74 11-Aug-77 62
LHA 3 Belleau Wood 112.5 15-Nov-69 5-Mar-73 11-Apr-77 18-Aug-78 66
LHA 4 Nassau 112.5 6-Nov-70 16-Aug-73 21-Jan-78 25-Jun-79 71
LHA 5 Peleliu 112.5 6-Nov-70 12-Nov-76 25-Nov-78 3-Apr-80 41
LHD 1 Wasp 822.0 28-Feb-84 30-May-85 4-Aug-87 5-May-89 48
LHD 2 Essex 402.5 10-Sep-86 20-Mar-89 23-Feb-91 10-Jul-92 40
LHD 3 Kearsarge 352.7 20-Nov-87 6-Feb-90 26-Mar-92 16-Aug-93 43
LHD 4 Boxer 341.4 3-Oct-88 18-Apr-91 7-Aug-93 21-Nov-94 44
LHD 5 Bataan 731.3 20-Dec-91 22-Jun-94 15-Mar-96 23-Jun-97 37
LHD 6 Bonhomme Richard 761.0 11-Dec-92 18-Apr-95 14-Mar-97 12-May-98 40
LHD 7 Iwo Jima 795.4 28-Feb-95 12-Dec-97 2-Feb-00 6-Apr-01 30
LHD 8 Makin Island 1,370.0 19-Apr-02 14-Feb-04 22-Sep-06 31-Jul-07 42
LHA 6 Unnamed 2,400.0 1-Jun-07     31-Aug-12  

    AUSTAL DELIVERS HAWAIIAN FERRYThe first of two large, high-speed, inter-island ferries has been delivered by Austal USA, in Mobile AL, to Hawaii Superferry Corporation.  The new vessel, named "Alakai", will begin service in August.  Read the announcement here June 1, 2007.

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.