Marine Log - November 2007 - (Page 46) TANKERTECH Marine Engineering (DSME). The San Diego shipyard is scheduled to lay the ship’s keel in December and deliver the ship in the second quarter of 2009. Frederick J. Harris, president of General Dynamics NASSCO, says, “We have taken a proven ship design and adapted it for efficient construction in this shipyard.” In August 2006, NASSCO received a $1 billion contract from U.S. Shipping Partners to build nine ships. The doublehulled ships will be 183m in length, displace 49,000 dwt and will have a cargo capacity of about 331,000 bbl. They are designed to carry petroleum and chemical products in Jones Act trade. The Jones Act, among its many provisions, requires ships that carry cargo between U.S. ports to be built in the United States. U.S. Shipping Partners has decided to name the first ship, Golden State, in honor of California where the ship is being built and expected to operate. The other ships of the class will bear the nicknames of American seaboard states. Last month, U.S. Shipping Partners announced that it has entered into a ICE CLASS TANKERS long-term charter agreement with a major oil company for a new doublehulled product tanker being built for U.S. Shipping Partners’ tanker joint venture, USS Product Carriers LLC. This vessel is due for delivery in late 2009 and will be employed in the U.S. domestic coastwise trade. U.S. Shipping Partners chairman and CEO Paul Gridley, says the company has now obtained long-term employment for four of the nine vessels in its newbuilding series. General Dynamics has provided a performance guarantee to USS Product Carriers in respect of the obligations of NASSCO under the construction contract. Following the delivery of the first tanker in the second quarter of 2009, NASSCO will deliver subsequent tankers every six to eight months. U.S. Shipping Partners expects the cost to construct its nine tankers will be $1 billion, exclusive of capitalized interest. The base contract price is subject to increase based on increases in certain published price indexes. In addition, NASSCO and USS Product Carriers share in any cost savings achieved measured against the original contract price based on the terms of the construction contract. The first five product tankers are being financed through a joint venture, USS Products Investor LLC. As you might recall, this past summer the U.S. Navy's Military Sealift Command has agreed to charter two new tankers being constructed for USS Product Carriers. The initial charter will be for 12 months at a cost of approximately $51 million. The Navy then has options to extend the charters via three one-year options and a further 11-month option, which if exercised would increase the cost to $220 million. The U.S. Navy said the ships would be deployed globally to transport petroleum products in support of US military forces. They will replace the current government-owned T-5 tankers that are expected to reach the end of their service life in 2010. The ships are due to be delivered to the Navy in late 2010 and early 2011. U.S. Shipping Partners fixed the first of this series of vessels to oil major BP in Dec. 2006. ML 46 MARINE LOG NOVEMBER 2007 www.marinelog.com http://www.seaark.com http://www.seaark.com http://www.marinelog.com
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