Page 28: of Maritime Reporter Magazine (September 1998)

LEGAL UPDATE order to avoid a substantial expense that will likely not be recovered in a short period of time.

The phase-out of these vessels could, therefore, occur even earlier than noted in the chart to the right.

An additional 18 vessels com- prising 902,214 dwt. are presently within the U.S.-flag double-hull fleet. These include four retrofit- ted vessels operated by American

Heavylift and the Double Eagle vessel, American Progress, built for Eletson Holdings then sold to

Mobil Oil Corporation.!

U.S. Flag Vessel Phase Out Projections

YEAR NUMBER OF VESSELS TOTAL DWT 1999-2003 38 3,339,783 2004-2008 27 2,042,738 2009-2015 18 1,151,390

TOTALS 83 Vessels 6,533,911 dwt.

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Maneuver. • .Propel.. .Position

Tunnel Thrusters 100 to 2000 HP

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Outstanding deliveries remain fc four Double Eagles representin 227,200 dwt. and two 125,000 dw tank vessels.2

Presently, the gap betwee

Jones Act tankers expected to g out of service versus those antic: pated staying in the U.S. trad represents about 60 vessels or ii excess of 5,000,000 dwt. carryin capacity. To an extent, that ga] will be filled by alternative means the increased use of double hul tank barges, integrated tug/bargt units, product carriers fron refineries at the point of sourci and pipelines (although the impac of pipelines on the environmen may limit their ability to increase capacity.) The need for deep drafi

Jones Act replacement tonnagf still exists. Therefore, it is crucia' that proposed legislation imple- menting the OECD Shipbuilding

Agreement recognize the impor- tance Jones Act vessels have to the

U.S. shipbuilding base and that the U.S. maintain and bolster incentives such as the Title XI pro- gram and Capital Construction

Fund. Both regimes are vital to continued private investment in such vessels. 1 Originally Eletson Holdings (a.k.a. Fleves Shipping

Corporation) ordered four product tankers at Newport

News Shipbuilding in additional to an order for five

Double Eagles placed by Hvide Van Ommeren tankers I-V

L.L.C. 2 The 125,000 dwt. vessels were ordered by ARCO Marine at Avondale Industries shipyard in Louisiana.

U.S. House Passes Ocean

Shipping Reform Act

The House of Representatives passed a bill aimed at partially deregulating the ocean freight business, but it must return to the

Senate after removal of a provision on merchant marine death bene- fits. With the Senate already out on its summer recess, a new vote will have to wait until September.

The Ocean Shipping Reform Act would allow carriers to negotiate confidential deals with individual shippers, which would break cur- rent cartel pricing by groups of ocean lines known as conferences.

Although the bill was approved by the Senate in April, it must return because Arizona

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