NASSCO Receives Exxon Contract For Two Alaska-Class Tankers

National Steel and Shipbuilding Company (NASSCO) of San Diego, Calif., announced it has received a contract for approximately $250 million from Exxon Shipping Company for construction of two 209,000-deadweight-ton Alaska- Class Tankers.

The NASSCO-designed tankers will be the largest ships yet built on the West Coast. Each will be 987 feet in overall length, 166 feet in beam, 88 feet in depth, and will have a 641/2-foot draft in loaded condition.

Propulsion will be by slow-speed diesel, capable of maintaining an average speed of 16% knots.

Keel-layings will take place during the third and fourth quarters of 1985, with deliveries scheduled for the fourth quarter of 1986 and the first quarter of 1987, respectively.

The contract is the first new construction contract received by the shipyard since 1980, according to C.L. French, chairman and chief executive officer of NASSCO, which is a wholly owned subsidiary of Morrison-Knudsen Company, Inc.

of Boise, Idaho. Repair and conversion of existing ships have been the yard's principal activities in recent years.

"NASSCO is acutely aware of the fact that the current demand for new ships, both military and commercial, is far less than is needed to maintain the current shipbuilding base," he said.

Mr. French said the contract was awarded NASSCO after direct design and price competition with several East Coast yards, and that NASSCO has priced the ships using estimates of manhours based upon production techniques employed extensively in foreign yards, particularly Japanese shipbuilding yards.

"We are confident that the employees of NASSCO will accept the challenge of these more advanced methods of shipbuilding and therefore maintain jobs at NASSCO," Mr. French said. "NASSCO has bid very aggressively to obtain this contract because our employees deserve the opportunity to prove they can master the higher productivity methods currently pursued in successful foreign shipyards." As transporters of Alaskan crude oil, the tankers will operate between Valdez, Alaska, and Panama where the crude will subsequently be transported to Gulf and East Coast ports. The ships will also be capable of delivering crude to West Coast ports. They are designed with the most modern equipment available and will meet the latest safety and environmental protection standards, including a protectively located clean segregated ballast system, inert gas system, safeguards to prevent the pumping of oily waste to the sea, sewage treatment system, collision avoidance radar, and a back-up steering system. The ships will also meet the latest Safety-of- Life-At-Sea regulations.

Since 1971, NASSCO has established itself as the predominant tanker design and construction yard in the United States with its design, construction and delivery of a total of 33 tankers to date.

NASSCO's current work force totals approximately 4,900, although a decline is anticipated before the end of 1984, extending well into 1985, as converted maritime prepositioning ships and converted fast logistic support ships are delivered.

Production work on the Exxon Shipping Company contract is expected to start late in the second quarter of 1985, Mr. French said.

On average, the new contract is expected to maintain employment at NASSCO during the construction cycle for about 1,100 oeople in addition to the yard's otner work. On this basis, it is expected that employment will regain its present level in late 1985. Mr. French explained that for every job created at NASSCO, about three to four additional jobs will be generated throughout the economy. It is expected that many of these jobs will be created in California and in particular in San Diego.

NASSCO's current backlog, including the Exxon Shipping Company contract, is approximately $820 million.