Nassco Afloat Again With Launching of Ship for Navy

The first ship constructed at National Steel & Shipbuilding Co. in more than three years will be launched today in a ceremony that will also symbolize the shipyard’s re-emergence as a shipbuilder.

The 754-foot-long Supply is scheduled to be launched at 10:30 a.m., the first of three Navy combat support ships the shipyard expects to build by 1994. A fourth ship, which still must be approved by Congress, would put the total value of the contract at $1 billion, said Fred Hallett, Nassco’s chief financial officer.

The ships, known as AOEs (auxiliary oiler explosives), are designed to carry fuel and ammunition in support of individual carrier battle groups. Each ship will be able to travel 25 knots, while carrying a maximum load of 150,000 barrels of fuel and 1,800 tons of munitions.

“Each ship incorporates high state-of-the-art technology and is capable of supporting a battle group while maneuvering. They are designed to load ammunition and fuels while on the move,” Hallett said. “It’s a very large and complex ship. The older AOEs were not capable of traveling at fleet speed.”

Although the Supply will be launched today, it will not be delivered to the Navy until May, 1992. It will take that long for Nassco to complete the electronic and engine work, Hallett said.

The Supply and other construction contracts Nassco holds symbolize the shipyard’s determination to survive in an industry that has seen 44 other U.S. shipyards close in the past eight years. Nassco, the only shipbuilding company on the West Coast capable of building large oceangoing vessels, weathered severe financial problems in the past two years.

Nassco’s former owner, Morrison-Knudsen of Boise, Ida., planned to sell or shut down the yard in 1988 after a $30-million loss. Management executives and employees joined to buy the company in April, 1989, and issued profit-sharing checks a year later.

The shipyard had 1,800 employees at the time of the buyout, but that has grown to 4,000 workers in the past 18 months, Hallett said.

The company is at work on another AOE, which is expected to be delivered to the Navy in 1993. In addition, Nassco was recently awarded a $129-million contract to build a container ship for San Francisco-based Matson Navigation Co., a contract that is still in the design stage.

In the past, Nassco has survived mainly on Navy repair contracts. It competed against shipyards on the Gulf and East coasts for the Matson contract, which it won because it was able to cut costs by reducing employee wages, Hallett said. The move enabled Nassco to compete with the other shipyards, he said, where wages are traditionally lower.

“We’re also looking forward to participating in the rebuilding of American oil tankers and converting them from single to double hulls,” Hallett said.

He said industry officials supported Congress’ recent mandate for double-hull tankers, with the phasing out of single-hull ships expected to begin by 1995. There are 147 U.S. registered tankers, Hallett said.

“Many of them will be retrofitted (to double hulls), but many will also be replaced because of age. We’re looking to retrofit and build them,” Hallett said.

The call for double hulls gained momentum in March, 1989, when the Exxon Valdez ran aground off the Alaskan coast, causing the biggest oil spill in U.S. history. The Valdez was renamed the Exxon Mediterranean after a $25-million repair job was completed at Nassco this summer.

The Mediterranean and its sister ship, the Exxon Long Beach, were built at Nassco in 1986 and 1987, respectively, and are both single-hull ships.