Tuesday, April 18 2000

Hvide Marine elects Gerhard Kurz CEO
Beleagured Hvide Marine Inc. has sprung another surprise. Today it announced the election of Gerhard E. Kurz as CEO and a member of the board. He takes over from James J. Gaffney, who was serving as interim chairman, and now becomes non-executive Chairman of the Board. Jean Fitzgerald, the former chairman and CEO who underwent successful heart surgery two weeks ago, will become a consultant to the company and remain on the board.

Gaffney described Kurz as "a logical and compelling choice to lead the company through its next phase."

Kurz, 60, is the recently retired president of Mobil Shipping and Transportation Company (MOSAT). He was appointed president of MOSAT in 1989.

Born in Stuttgart, Germany, Kurz joined Mobil Shipping Company Limited in London in 1964 as a chartering assistant following his graduation from the University of Wales with Honors in Economics. The next year he was transferred to Mobil's Marine Division in New York, during which time he also earned an MBA from New York University. After a series of promotions, he was appointed vice president of planning, Middle East and Marine Transportation, and then President of MOSAT.

Kurz is past Chairman of the MPA (Marine Preservation Association, 1995-99) and the OCIMF (Oil Companies International Marine Forum, 1991-99). He is currently a member of the ABS (American Bureau of Shipping) Board of Directors and Chairman of the ABS Finance and Nominating Committees. He also serves on the Boards of the Seamen's Church Institute, International Registries, Inc., the Coast Guard Foundation, and the Newport News Mariners' Museum. He is a founding member of the Massachusetts Maritime Academy's International Business Advisory Council.

Kurz is the recipient of numerous awards and honors presented in recognition of his leadership role and efforts on behalf of the maritime industry. Among these are the Seamen's Church Institute Silver Bell Award, the International Maritime Hall of Fame Award and the U.S. Coast Guard Award and Medal for Meritorious Public Service. He holds an Honorary Doctorate Degree from Massachusetts Maritime Academy.

Don't write off Taiwan destroyer deal just yet
"President Clinton decided yesterday to sell a package of high-tech weapons to Taiwan, but followed a Pentagon recommendation to put off the politically volatile sale of four Aegis destroyers, today's Washington Post reports.

The package approved by the administration includes sophisticated air-to-air and anti-ship missiles as well as a "Pave Paws" long-range radar system able to peer thousands of miles into mainland China. "But ," says the paper, "Congress is likely to focus on the deferral of the sale of four Aegis warships, which cost about $1.1 billion each and boast powerful radars able to track more than 100 incoming missiles and aircraft at a time."

The Washington Post story notes that "despite yesterday's decision, it is possible that Congress may yet prod the administration into selling Taiwan the Aegis destroyers--or into some compensatory measure, such as giving the U.S. Navy's Pacific Fleet more Aegis-equipped warships that could be dispatched to Taiwan in a crisis. The Aegis ships are built primarily at shipyards in Mississippi, home of Senate Majority Leader Trent Lott (R), and Maine, home of Defense Secretary William S. Cohen."

One thing is certain. Four more Aegis destroyers would fit very nicely into the production programs of Litton Ingalls and Bath Iron Works. The FY 2001-2005 Navy shipbuilding procurement program cuts DDG-51 Aegis destroyer procurement to two ships a year in FY 2002 and 2003, but extends the program by procuring two ships in FY 2004 and one in FY 2005. The first DD-21 land attack destroyer is also set for FY 2005. Adding in the Taiwanese ships (or extra U.S. Navy ships to defend Taiwan) would bring procurement back up to three ships a year, which is probably the minimum level needed to sustain efficient production at two shipyards.

UDS and Ceres Hellenic in Suezmax deal
Ultramar Diamond Shamrock Corp. and Ceres Hellenic Shipping Enterprises Ltd. today announced a 10-year agreement for a fifth Suezmax tanker to be used in the UDS's crude transportation program. The vessel, which will be owned by Ceres and built by Hyundai Heavy Industries, Ltd., is scheduled for delivery in late 2001.

UDS earlier announced a seven-year agreement with Sonatrach, the Algerian national oil company, for an additional 35,000 barrels per day of light, low-sulfur crude oil for delivery to the company's Quebec refinery located northeast of Montreal on the Saint Lawrence River.

"This agreement is an important part of our strategy to grow earnings and return through integrated operations," said Jean Gaulin, UDS chairman and CEO. "Our agreement with Sonatrach secures an additional supply of quality crude oil and our agreement with Ceres secures the means of safely and efficiently transporting the additional volume to our facilities."

The $54 million, 160,000 metric-ton vessel will be built to 40-year trading standards. Special grade steel, capable of withstanding the very low temperatures of the North Atlantic, will be used in the construction of its ice-strengthened, double-walled hull. An increased beam and shallower draft will allow for maximum cargo intake and fully laden deliveries into the shallow marine terminals of the Saint Lawrence River. The vessel's lower draft will also provide UDS the flexibility of delivering cargoes to Corpus Christi, Texas, for refining in its Three Rivers facility.

The ship's segregated ballast capacity will be over 50% of t total deadweight.

Ultramar has focused almost exclusively on very modern, ice-strengthened double-hulled tankers for its crude oil program. The Cap Georges,Cap
Laurent, Cap Jean" and Cap Romuald, which were all built in 1998, presently serve as the core lifting capacity for the company's Quebec deliveries from the North Sea, Mediterranean and West Africa.

UDS and Ceres have been strategic partners in time-charters and spot voyages to Quebec since the late 1980s.


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