Seabulk Returns to NASSCO for LNG-Ready Product Tanker

Seabulk Tankers has returned to NASSCO shipyard in San Diego for up to two additional dual fuel-capable product tankers in the latest display showing U.S. owners’ and operators’ appetite for LNG-ready vessels in the Jones Act market.

General Dynamics NASSCO, a wholly owned subsidiary of General Dynamics (NYSE: GD), announced Tuesday it has entered into a contract with Seabulk Tankers, Inc., a wholly owned subsidiary of SEACOR Holdings Inc. (NYSE: CKH), for the design and construction of one 50,000 DWT LNG-conversion-ready product carrier with a 330,000 barrel cargo capacity to operate in the Jones Act market. The order includes the option for a second vessel.

Construction of the vessel is scheduled to begin in 2015 at the NASSCO shipyard in San Diego, with delivery scheduled for the fourth quarter of 2016. This order brings the total of on order vessels for Seabulk Tankers, Inc. at NASSCO to three following an order placed in September for two similar vessels.

Charles Fabrikant, executive chairman of SEACOR Holdings, commented, “We are pleased to expand our relationship with NASSCO with this additional Jones Act tanker order. These ECO tankers will play a vital role in offering Seabulk’s customers some of the most modern and fuel efficient vessels available as they determine their Jones Act transportation requirements for crude oil and refined products over the coming years.”

This new 610-foot-long tanker is a continuation of the ECO MR tanker design, which delivers improved fuel efficiency and incorporates the latest environmental protection features, including a Ballast Water Treatment System. Like the two previous tankers, this new vessel will be designed by DSEC, a subsidiary of Daewoo Shipbuilding & Marine Engineering (DSME), and will have conversion-capable, dual-fuel-capable auxiliary engines and the ability to accommodate the future installation of an LNG fuel-gas system and Type C LNG tanks.

Including this order, NASSCO is now under contract for the design and construction of seven product tankers, including four LNG-conversion-ready vessels for American Petroleum Tankers.

Kevin Graney, vice president and general manager of General Dynamics NASSCO, said, “NASSCO remains committed to bringing the most economical and environmentally sound technology to Jones Act owners and operators. We are pleased to extend our partnership with SEACOR through a third and potentially a fourth ECO tanker. This follow-on order is a clear indication that NASSCO is the shipyard of choice for Jones Act tankers.”

The order announced today also follows recent orders for Jones Act qualified, dual fuel containerships from Matson, which has placed orders for two 3,600 TEU vessels, and TOTE, which has ordered three 3,100 TEU vessels, at Aker Philadelphia and NASSCO, respectively.  In addition, Horizon Lines is planning to convert two of its steam-powered containerships to the use of dual fuel, one of which is being partially funded by MARAD and will be used to measure the efficiency and air emissions of the new LNG dual fuel engines as the vessel operates between Long Beach, California, and Honolulu, Hawaii.