Shipping, shipbuilding, offshore news

June 26, 2006

International Shipholding to move HQ from New Orleans

International Shipholding Corporation (NYSE: ISH) has announced plans to relocate its corporate headquarters and CG Railway operations from New Orleans to Mobile, Alabama, due to the closure of the Mississippi River-Gulf Outlet (MR-GO) and its uncertain future.

The announcement was made by International Shipholding Corporation Chairman Erik F. Johnsen. The company anticipates completing the move by early 2007.

"Our company, unfortunately, is another victim of Hurricane Katrina," said Johnsen. "With the post-Katrina closure of the MR-GO to deep-draft shipping, and after extensive research, we could find no other site in Louisiana for our specialized rail-ferry service."

The Mississippi River-Gulf Outlet Canal is a 66 mile channel that provides a shorter route between the Gulf of Mexico and New Orleans' inner harbor. Completed in 1965 it was intended to be useful both as a shorter route than the twists of the Mississippi River and for deep-draft vessels that cannot transit the Industrial Canal locks. In the Hurricane Katrina disaster, levees along MR-GO were breached in approximately 20 places along its length, directly flooding most of Saint Bernard Parish and New Orleans East. Storm surge from MR-GO has also been a suspect in the three breaches of the Industrial Canal. The Supplemental Appropriations Bill agreed on by House and Senate conferees this month directs the Army Corps of Engineers to develop, in conjunction with its ongoing Comprehensive Coastal Protection and Restoration planning, a plan that would close MR-GO to deep draft navigation and to address wetland losses and storm risks linked to MR-GO.

International Shipholding will be moving its headquarters at Poydras Center along with its CG Railway service to a facility in Mobile. However, its barge repair operation, LASH (Lighter Aboard SHip) Barge Repair Yard in Lafitte, Louisiana, will remain along with all of its 50 employees. Additionally, the company expects to retain its terminal lease, while exploring alternative uses for the site.

"I want to emphasize that our decision to relocate is based upon the unique post-Katrina circumstances facing our company," Johnsen continued. "It should not be seen as an indication of our views on the future economic health of the greater New Orleans area. In fact, we are optimistic that the City of New Orleans will enjoy a vibrant rebirth, which is already evidenced by the return of the Port of New Orleans to its pre-Katrina levels."

International Shipholding Corporation was founded as Central Gulf Steamship Corporation by the Johnsen family in 1947. It went public in 1979 and is a registered member of the New York Stock Exchange.

"Our roots are in New Orleans and it pains us to leave. However, we will have a continued presence in Louisiana," said Johnsen.