NASSCO gets $578.2 million T-AKE contract
National Steel and Shipbuilding Company (NASSCO), a wholly owned subsidiary of General Dynamics (NYSE: GD), announced yesterday that the U.S. Navy has exercised options to build two additional ships under the T-AKE program.
The $578.2 million contract brings the total number of these ships awarded to NASSCO to six, and the total contract value to $1.87 billion. The contract includes options for an additional six ships.
Richard Vortmann, president of NASSCO, said, "We are extremely pleased that Congress continues to fund additional ships for the T-AKE program, the first new Navy combat logistics force ship design in almost 20 years. These two additional ships will provide sustained employment for 1,500-1,800 NASSCO employees through 2007."
Exercise of this option expands NASSCO's firm backlog to 10 ships, the largest in the company's history.
In addition to the six T-AKEs, the company is building four double-hull oil tankers for BP Shipping Company of Alaska.
"A 10-ship backlog affirms NASSCO's position as the leading U.S. builder of commercial ships and the U.S. Navy's 'Center of Excellence' for construction of auxiliary and support ships," Vortmann said.
Construction on the first T-AKE, the USNS Lewis and Clark, began in September 2003. Delivery is scheduled for 2005. The Navy's 12-ship program will have a total value of $3.7 billion and will give NASSCO a firm backlog through 2010.
The T-AKE is a dry cargo/ammunition ship that will be operated by the Military Sealift Command, providing logistic lift from sources of supply either in port or at sea. The ships will transfer cargo - ammunition, food, fuel, repair parts, and expendable supplies and material - to station ships and other naval forces at sea. The T-AKE will contribute to the Navy's ability to maintain its global presence, replacing aging T-AE ammunition ships and T-AFS combat stores ships that are nearing the end of their service lives.
The T-AKEs will be 210 meters (689 feet) in length and 32.2 meters (105.6 feet) in beam, with a design draft of 9.12 meters (29.9 feet). The ships will carry almost 7,000 metric tons of dry cargo and ammunition and 23,500 barrels of marine diesel fuel. The T-AKEs will be the first modern Navy ships to combine proven international marine technologies such as an integrated electric-drive propulsion system with commercial design features that will minimize their cost of operation and maintenance over their expected 40-year life.