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NEWSBY THE NUMBERS10Maritime Reporter & Engineering News Offshore FPS Demand Grows IMA has completed a study of the floating productionmarket, and the report documents strong growth in the business sector. According to the market survey, 1 float- ing production units have been ordered over the past four months a record pace reflecting strong underlying mar- ket drivers. 256 floating production systems are in service or avail- able worldwide. FPSOs comprise 62 percent of the in- ventory. The balance is comprised of production semis (1 percent), tension leg platforms (9 percent), production spars ( percent), production barges and FSUs (5 per- cent). Of the total production floater inventory, 11 units are currently off field and available for reuse making the effective utiliation rate 95. percent. The 1 orders since March include the world?s 1st FN. At billion the Prelude FN is the most ex- pensive floating production unit ordered to date. Among the other orders are nine FPSOs (1 purpose-built unit, 6 units converted from trading tanker hulls and 2 modifica- tion/redeployments), 2 production spars and 2 purpose- built FSUs. Total value of the 1 construction contracts exceeds 11 billion. Current order backlog consists of 5 production floaters, a net increase of 6 units since March. This extends the buildup in backlog that began in second half 2009. 28 units utilie purpose built hulls, 25 are based on converted tanker hulls. 20 units are being built for leasing operators, directly for field operators. In the report IMA identifies 196 projects in the bidding, design or planning stage thatpotentially require a floating production or storage sys-tem.Number of Floating Productions Systems(FPS) ordered since March 2011.Number of potential floater projects in theplanning cycle, in Brail alone, which individ- ually is the most active region for future proj- ects.Number of projects in the bidding, design or planning stage that potentially require a float- ing production or storage system.Number of Floating Productions Systems(FPS) in service or available worldwide. The Average Cost of the 1 Floating Productions Systems (FPS) ordered since March 2011.Dollar amount of Floating Productions Sys-tems (FPS) ordered since March 2011.oure IM ssociates www.imastudies.com 1450196256$785,714,285.71$11bDOJ: Off Course in Shipyard Litigation At a time when every federal penny should count, the U.S. Department of Justice is embarking on an ill-ad-vised, potentially expensive and ultimately counter- productive legal action against the U.S. Coast uard?s primary shipbuilding contractor. o figure. Showing questionable wisdom, the United States and its justice department have filed suit against Bollinger Shipyards Inc., Bollinger Shipyards ock- port C and alter Bollinger Joint Venture C. In general terms, the government alleges that the ouisiana shipbuilder misrepresented the hull strength of a series of vessels that it was improving and lengthening about five years ago. The first con- verted cutter, according to the government, suffered hull failure when put into service. Eventually, said the U.S. Justice Department in a prepared statement,Efforts to repair the Matagorda and the other con- verted vessels were unsuccessful. The cutters are un- seaworthy and have been taken out of service. As the government seeks damages from Bollinger for the loss of the eight vessels the upgrades alone said to be worth about 95 million the Coast uard itself continues to struggle in an effort to renew an aging fleet and related equipment. Ten years after launching the aggressive, 25b Deepwater program to do just that, the nation?s fifth military, uniformed service has little to show for the b already spent. The latest DOJ action, coming years after the work it- self was complete, cannot hope to hide those failures. BNE ESPNDS For its part, Bollinger responded to the suit by say- ing in a prepared statement dated August 1, Sinceits founding, Bollinger Shipyards has operated on the principle that uality is reebered long after the price is forgotten. hree generations of the Bollinger faily hae earned a spotless record for honest and fair dealing with eery custoer, including the U.S. Nay and Coast uard, our largest client. Since 1, Bollinger has built eery patrol boat the Coast uard has purchased to date soe 1 hae been deliered. The statement went on to say, We are disappointed with the Department of Justice?s decision to file a complaint related to work completed in 2006. Throughout this process, Bollinger has been open andcooperative with the government, and we remain committed to providing the government all necessary information and assistance to bring this matter to aclose. Bollinger has tried to find a way to resolve this matter short of litigation, but we are fully prepared to defend our good name aggressively in a court of law. Indeed, and as if to underscore their response,Bollinger also noted the launch of the U.S. Coastuard?s second, 15-ft. Fast esponse Cutter from its ockport, A shipyards. The event according to the Coast uard itself marks a significant milestone in the Coast uard?s acquisition of the Sentinel-class patrol boats. And, the third Fast esponse Cutter is tentatively scheduled to be launched Nov. 10. et?s sum up 122 Coast uard patrol boats delivered since 198, an ongoing relationship with the Coast uard and a record of typically delivering what the Coast uard wants in a timely fashion. Not bad for an out- fit now accused of misrepresenting the facts. BAME AME From where I sit, there is probably plenty of blameto go around, but don?t take my word for it. The re- cent (28 July) AO eport about the Coast uard?s Deepwater program is also telling. The 86-page e- port, AO-11-1, Coast uard Action Needed As Approved Deepwater Program emains Unachiev- able, says, among other things, The Deepwater Pro- gram continues to exceed the cost and schedule baselines approved by DS in 200. None of that is any secret, of course, and the report goes on to list numerous problem and setbacks associated with thestar-crossed efforts. Central to the Coast uard?s troubles in the Deepwater effort was its own failure to properly oversee the effort from the beginning. Coast uard Commandant ADM obert Papp himself was recently quoted as saying, Ill be the first to admit, we werent prepared to start spending this money and supervising a project this big. eaving the details and supervision of the projects to the contractorsthemselves, the Coast uard eventually lost control of the multi-billion dollar project. The government?s action against Bollinger also comes as a cost-con-scious Congress, led by ep. Frank obiondo ( - NJ), are on record as saying that they will no longer provide a blank check to the Coast uard. And, while that makes sense on many levels, it also comes at a time when the Coast uard?s efforts in the rap- idly thawing Arctic are also ramping up significantly, with inadequate resources particularly in way of icebreakers that can cost up to 1 billion each to do the job. In numerous interviews over the past few years, especially where it comes to Deepwater and ship acquisition efforts, the Coast uard leadership has opted to look ahead, not behind. The party line has become, Don?t look at where we?ve been; in- stead look how far we?ve come. Fair enough. Today, however, and as the Coast uard implores Congress to forget the past, the Department of Justice seems just as intent upon dredging it up. But, it doesn?t seem right to let them have it both ways, does it Bollinger certainly won?t be afforded that luxury. At the end of the day, you have to wonder how much it will cost Bollinger and ultimately, the U.S. taxpayers, to defend and prosecute a case from whichvirtually nothing good can come. Did the shipyard drop the ball or was the Coast uard deficient in their contract administration I honestly have no idea. Five years down the road, it is a curious time to be finding out. It will also be expensive. ow many patrol boats could we be building with that money Finally, and perhaps most importantly, who will build these boats and others, if and when, years from now, the govern- ment triumphs Joseph Keefe, in his August 24 Blog on MaritimeProfessional.com ,weighs in on the legal dispute between the USCG & Bollinger.