Maritime Memos


December 2009


A RUM YEAR

2009 was a year packed with all kinds of bizarre events.  Hawaii SuperFerry folded and MARAD took control of the two big ro-pax boats: the expectation is that they will soon be painted gray.  US Shipping Partners was pushed out of its over-ambitious product carrier program at NASSCO and filed for Chapter 11, but emerged under its same old tired management before the year was over.  Superior Boat Works and Island Boats closed.  Erie Shipbuilding also closed but Donjon Marine took over the yard: why, who knows?  Bender Shipbuilding got into contractual disputes with all its new construction customers and ended up filing for Chapter 11: VT Halter Marine acted as a stalking horse for the resulting auction and offered $21 million for some, but not all, of Bender’s assets, but other bidders will join in the bidding in January.  Appeals courts overturned both the lower court decisions concerning rebuilds of Jones Act ships in foreign shipyards, opening the way to a further decline in the U.S. ship repair industry.  The Navy decided to classify its INSURV reports, presumably to attempt to avoid further embarrassment from that unimpeachable source.  Bollinger Shipyards formed an operating company to run the PSVs it has been building on spec.  The DoT handed out $115 million in grants to small shipyards for capital improvements and another $110 million in grants for ferry projects, many of which involved construction of new ferries.  President Obama nominated a young and inexperienced lawyer to be Maritime Administrator but his confirmation hearing was mysteriously postponed.  The sad old Independence finally showed up off Alang, having apparently been hiding in the Arabian Gulf, but the Indian Government would not allow her in: she is now aground and falling apart.  Shell America terminated its product carrier program with American Heavy Lift Shipping, for which Atlantic Marine Alabama is the shipbuilder, but it is not clear what will happen next.  NGSB delivered the USS New York, (LPD 21), and she was commissioned with appropriate hoopla in New York City.  Austal delivered the other LCS, the USS Independence, (LCS 2).  And the trailer barge La Princesa got caught in a storm and ran aground in Virginia Beach, home to countless retired Navy folk: she was refloated without any of the locals discovering that she had been carrying 36,000 cases of Captain Morgan.  As I said, it was a pretty rum year.  December 31, 2009.

ONE OF NEWPORT NEWS' FINEST STILL GOING

We're used to the idea that Newport News Shipbuilding builds fine ships and we're used to the idea that many US-built ships tend to keep going almost indefinitely, but their Hull # 176, the Doulos, pictured on the right, is quite something, still going at age 95.  She was built in 1914 as the break-bulk cargo ship Medina, for Mallory Steamship Company - forerunner of the well-known shipbrokers.  She was sold in 1948 and converted to a passenger ship, named Roma, and then in 1952, Costa Line bought her and converted her to diesel, renaming her Franca C and operating her in the Italy-Argentina immigrant service until 1959, when they converted her for cruising.  Since 1977, she has been the Doulos, a floating library - now there's an esoteric service for you - and is currently in Singapore.  As she comes up for her 18th Special Survey, her present owners - Gute Bücher für Alle - have decided that they can't keep her going any longer, but Tradewinds reports that there is a plan to turn her into a museum and training ship in South Africa.  Let's hope this comes off.  December 30, 2009.

ANOTHER CASINO SHIP OPERATOR FOLDS

The operators of the casino ship Palm Beach Princess - pictured on the right - have filed for Chapter 11 protection, most of the employees have either been laid off or have quit, and the ship is tied up pending repairs to the main engines.  This company's not coming back.  Read the story in the Palm Beach Post here.  According to Clarksons, International Shipping Partners sold this ship - built by Wartsila in 1964 for the Helsinki-Stockholm service - to its present owner for $15 million, just last year.  $15 million for a 45-year-old boat in a trade which has nowhere to go but down?  What an idiot!  December 29, 2009.

GOLDEN BEAR TO BE SOLD AT AUCTION

The Cal Maritime training ship from 1972 to 1999, Golden Bear, ex-DelOrleans, ex-USS Crescent City, (AP 40/APA 21) - pictured on the right - and most recently ArtShip, will be sold at auction next week, according to an announcement in Pacific Maritime magazine.  She was originally a C3 cargo shop, built at Sparrows Point in 1940.  December 29, 2009.

FIRST BULKER TO BE SCRAPPED

Tradewinds reports that the 17,900-dwt Melvin H. Baker has been sold for scrap.  This is an historic ship, the first true bulker, as opposed to an ore carrier.  She was built in 1956 to carry gypsum between Eastern Canada and the U.S., to a design conceived by Ole Skaarup, the well-known Greenwich shipowner who is also famous as a star of the musical stage and as the man who led the exodus of shipping from New York City to Connecticut.  The now familiar octagonal cross-section of the cargo holds of a bulker is now standard on over 7,000 ships.  Read an article about it hereDecember 26, 2009.

EGYPT REQUESTS A FOURTH FMC

The Defense Security Cooperation Agency reports that the Government of Egypt has asked for a fourth Fast Missile Craft to be added to the program at VT Halter Marine.  Read the announcement here.  This was originally a four-boat program but it got cut back to three, presumably for budgetary reasons.  December 26, 2009.

CONNAUGHTON BACK IN POLITICS

Sean Connaughton, the former Maritime Administrator and current ABS employee, is to return to the political arena, as Secretary of Transportation for the Commonwealth of Virginia.  Read the report in the Richmond Times-Dispatch hereDecember 23, 2009.

VT HALTER GETS ANOTHER T-AGS

The Navy has awarded a firm-fixed-price contract to VT Halter Marine for the construction of T-AGS 66, the seventh of its Pathfinder class of survey ships.  The six previous ships of the class were all built by Halter.  The price is $87 million an, with delivery in April 2013.  Read the DefenseLink announcement here and the company's announcement hereDecember 23, 2009.

WORLD'S LARGEST SHIP SOLD FOR SCRAP

The legendary tanker Knock Nevis, ex-Jahre Viking, ex-Happy Giant, ex-Seawise Giant, ex-Oppama, has apparently been sold for scrap.  Built by Sumitomo in 1979 and converted to an FSO in Dubai in 2004, she was, at 260,000 GT, clearly the largest ship in the world, although some untrained folks used inappropriate units of measurement to claim otherwise.  Press reports say that she recently moved from anchorage off Qatar to anchorage off Alang.  The world's largest ship is now the TI Oceania, a 234,000-GT tanker owned by OSG.  In case you were wondering, the Oasis of the Seas is about 220,000 GT.  December 21, 2009.

MERRY SOLSTICE, EVERYONE

OK, relax, panic over.  The days are getting longer again.  Time to celebrate.  December 21, 2009.

LCS 2 DELIVERED

The Navy has accepted delivery of the future USS Independence, (LCS 2), and Austal USA has laid the keel for the future USS Coronado, (LCS 4).  Read the Navy's announcement here and Austal's hereDecember 19/21, 2009.

OSG COMPLETES ACQUISITION OF OSG AMERICA

OSG America didn't last long.  Spun off at the end of 2007, it is now part of OSG again.  Read OSG's announcement hereDecember 18, 2009.

COAST GUARD ORDERS THREE FRCs FROM BOLLINGER

The Coast Guard has exercised options on its contract with Bollinger for the next three 154-foot, 28-knot Sentinel-class fast-response cutters (FRCs) - pictured on the right.  The contract price is $142 million, i.e., about $47 million each.  Deliveries are not stated but the plan is believed to be to deliver the whole class at eight-week intervals, consistent with Bollinger's manufacturing approach to patrol boat construction, developed on the Island-class program and refined on the Protector-class program.  Read Bollinger's announcement here and the Coast Guard's hereDecember 18, 2009.

DEFENSE APPROPRIATIONS BILL FALLS SHORT

The bill isn't law yet but apparently the conference report includes $15 billion for the SC,N account, covering one DDG-51, one SSN, two LCSs, one JHSV and two T-AKEs.  December 18, 2009.

DONJON TAKES OVER ERIE SHIPYARD

Marine Log reports that Donjon Marine has taken over the lease of the shipyard in Erie PA and formed Donjon Shipbuilding & Repair, LLC.  Read the story here.  Oh, dear.  Donjon is a fine company, with competent and experienced management, but .....  Well, we shall see.  Maybe they have some wizard scheme for building a new generation of lakers.  December 18, 2009.

MATSUDA NOMINATION HELD UP

The Maritime Executive reports that the Senate hearing of David Matsuda's confirmation as Maritime Administrator has been postponed.  Read the story hereDecember 18, 2009.

HORIZON CUTTING COSTS

As part of a "broader, ongoing, cost-reduction initiative", Horizon Lines says it will eliminate "all perquisites for executive officers".  Read the announcement here.  Well, good for them.  Maybe now they'll be able to make a down payment on a new ship.  December 17, 2009.

FABRICATION STARTS ON EGYPTIAN FMCs

Fabrication has finally started on the three Fast Missile Craft being built for Egypt by VT Halter Marine, under an FMS agreement.  Read the U.S. Navy's announcement here.  Although the announcement says that the construction contract was signed in September 2008, the reality is that this project was initially contracted with VT Halter's predecessor, Halter Marine, in 2000 - why, that's so far back that I was still working there.  Those Egyptians are certainly patient people.  Note that this 200-ft boat - pictured on the right - which is based on the Ambassador Mk. III design developed by Scottish naval architects Vosper International, is more heavily armed than an LCS and can do 40 knots.  What's more, at $210 million each, this boat is about a third of the cost of an LCS.  Now, how about a simpler version of this design for the Coast Guard's OPC program?  December 17, 2009.

VT HALTER OFFERS $21MM FOR BENDER

It seems that VT Halter has taken on the role of stalking horse in the bankruptcy auction of the assets of Bender Shipbuilding, with an offer of $21 million for the main yard.  This does not include Bender's prefabrication shop, the upstream Yard 9 or the Mexican operation.  Read the report in the Mobile Register here.  The deadline for competing bids is January 11.  December 16, 2009.

OSG SETTLES WITH ASC AND BUYS TWO SHIPS

OSG has settled its dispute with the inappropriately named American Shipping Company and Aker Philadelphia.  Read the announcement here.  As a result, OSG will buy the two ships to be converted to shuttle tankers instead of bareboating them from ASC.  The first of the two, Overseas Cascade, was delivered simultaneously.  December 14, 2009.

ALANG SHOWS OFF

When you beach a ship for scrapping, it's generally a good idea to pick an unoccupied stretch.  Click here to see a You-Tube video of what happens otherwise.  (I know this clip is six months old but it's new to me and, I suspect, to most of you.)  Do you suppose that the international maritime industry might get serious about ship recycling some day?  No, I guess not.  December 14, 2009.

HILL'S BILL INCLUDES MILLS FOR SHIPBUILDING

The omnibus appropriations bill passed yesterday - known on the Hill as the "minibus" bill -  includes $15 million for the Small Shipyards Grant Program and $5 million for Title XI, as well as $174 million for the operators of foreign-built but US-flag ships.  Read the relevant language here.  The $5 million for Title XI is not nearly enough - it will fund only around $100 million in contracts - but I suppose that it's better than nowt.  December 14, 2009.

FORMER INDEPENDENCE NOW ABANDONED

The sad old Independence, now technically called the DV (for dead vessel) Platinum II, appears to have been abandoned by her owners.  She is aground in an anchorage off Copnath, near Alang, breaking up and taking on water.  Tradewinds reports that none of the Alang breakers want anything to do with her and she is said to be in a location where she cannot easily be salvaged.  This is really disgraceful, an embarrassment to the United States.  Will anyone bring this up in Copenhagen?  How could MARAD and the EPA have allowed this and what do they have to say about it?  Read more on MarineBuzz.com here.   December 12, 2009.

SHIPBUILDERS LOSE MATSON CASE

The Shipbuilders Council's challenge to the Coast Guard's approval of Matson's rebuilding of the Mokihana in a Chinese shipyard was rejected in federal court in Alexandria VA this week.  Read the judge's ruling hereDecember 11, 2009.

AHL RESPONDS TO PRESS REPORTS

American Heavy Lift Shipping has responded to press reports concerning the three-ship construction program at Atlantic Marine Alabama.  Read their press release here.  The gist of the message is that the shipyard's over-runs and delays created cash problems.  In addition, they reiterate that AHL Shipping itself is not affected.  The lawsuits arising from this will run for quite a while, I think.  December 11, 2009.

MATSUDA PROMOTED

David Matsuda, who has been Deputy Maritime Administrator for all of four months, has now been nominated for the Administrator's position.  Mr. Matsuda's experience consists of four years in the safety law division of the Federal Railroad Administration and seven years on the staff of Senator Frank Lautenberg.  December 10, 2009.

AHL'S THREE SHIPOWNERS ALL FILE

The three LLCs that are the owners of record of the three product carriers that were being assembled by Atlantic Marine Alabama have filed for protection under Chapter 11 of the Bankruptcy Act.  The three companies - Dos Ravens Tankships, First Mesa Tankships and Keet Steel Tankships - all operate from the same address as American Heavy Lift Shipping.  In addition, Tradewinds reports that Atlantic Marine has asked the court to declare that it has valid liens on the work-in-progress.  December 10, 2009.

MARINETTE GETS ARRV

Surprise, surprise.  As predicted in this column, Marinette Marine has been awarded the ARRA-funded contract to build the Alaska Region Research Vessel, (ARRV).  The value is $123 million, with delivery in 2013.  Read the announcement hereDecember 10, 2009.

NASSCO DELIVERS

NASSCO has delivered the Sunshine State, the third of its series of 49,000-dwt product carriers, about 11 months ahead of schedule.  Read the announcement here.  That's three product carriers and two T-AKEs delivered this year: not bad.  The extent to which NASSCO has improved its productivity and schedule performance since teaming up with Daewoo is truly remarkable and an example to other U.S. yards, large and not so large.  December 5, 2009.

LCS COSTS REVEALED

The Navy has finally revealed the contract cost of the second pair of LCSs.  The contract prices are $471 million for LCS 3 and $434 million for LCS 4, to which must be added $78 million and $114 million, respectively, for material ordered for the earlier contracts, which were cancelled.  So that means that LCS 3 will cost $549 million and LCS 4 will cost $548 million, two remarkably adjacent numbers.  Read the Navy's announcement here.  Read the Defense News article hereDecember 3, 2009.

U.S. ARMY DEFEATS THE DEMON BEER

The London Times reports that the U.S. Army has destroyed 7,000 cans of beer belonging to the Royal Navy.  Read the story here.  A narrow escape from the ever-present threat of rampant alcoholism!  December 3, 2009.

NEXT DDG FUNDED, SORT OF

The Navy has given NGSB a letter contract for $170 million to order long-lead-time material for DDG 113.  Read the DefenseLink announcement here.  Why do we still not have a Defense Appropriations Act?  The House version was passed on July 30 and the Senate version on October 6: one might think that they could have found time by now for a conference, but apparently not.  December 3, 2009.

RUM GALORE

Shades of the SS Politician, which had 24,000 cases of Scotch on board when she was wrecked on Eriskay, in the Outer Hebrides, in 1941, giving rise to the famous novel by Compton Mackenzie and the movie Whisky Galore.  It's a good thing that all those retired naval persons in the Virginia Beach area didn't know that the barge that ran aground there last week, La Princesa, had 36,000 cases of Captain Morgan rum on board.  Ah, well, too late now.  December 2, 2009.

ALASKAN SHIPYARD DELIVERS

Alaska Ship & Drydock Inc., which operates the state-owned shipyard in Ketchikan, delivered the marine fueling station Chevron Legacy to Chevron Canada yesterday.  Read the announcement here.  Yes, that's right, Chevron Canada: an export order, no less, to be employed in Vancouver BC.  One suspects that there was more to this deal than met the eye.  December 2, 2009.

BOB MAGEE DEAD AT ONLY 61

Bob Magee, the President of Saltchuk's shipping group, which includes TOTE and Sea Star, has died at the ridiculously early age of 61.  Read the announcement here.  I first met him when he worked for Sun Ship: a great guy, excellent at whatever he took on.  December 2, 2009.


~~~~~ NEWS & COMMENT ARCHIVES ~~~~~

To read earlier news and comment, click here.