Accord Near in Dispute on Cruise Ship Refit : Shipyard: Southwest Marine and owners of the Viking Serenade reportedly reach agreement ending dispute that halted the $75-million renovation of the vessel.

Southwest Marine and Miami-based Royal Caribbean Cruises Ltd. have reached a tentative agreement that calls for Southwest to complete a $75-million refurbishment of the Viking Serenade, a large cruise ship that has made regular calls at Southern California ports.

Southwest on April 19 ordered its crews, who had been working around the clock, to stop work on the complex refurbishment. That decision was driven by a contract dispute with Royal Caribbean, according to officials at both companies.

Intense negotiations that began early last week in Miami and San Diego could produce a final agreement to resume work as early as this morning, Southwest spokeswoman Jacqueline Kreisler said.

“We have reached (a tentative) agreement to continue work,” Kreisler said. “The line at our employment office has been really long because the 1,000 people we laid off (on April 19) are coming back to get jobs.”

Kreisler declined Monday to elaborate on terms of the agreement. A Royal Caribbean spokesman, said an “announcement” would be made this morningbut declined further comment.

On April 23, Royal Caribbean announced that the contract disagreement had led to the termination of the $75-million contract. At that time, the Miami-based cruise operator indicated that it was looking for another yard to complete the renovation.

The extensive refurbishment, which includes the addition of nearly 300 cabins, a new bow, a huge disco and expanded galley and dining facilities, is the largest commercial cruise ship repair contract won by a U.S.-based shipyard in 30 years. Southwest began work on the ship in mid-January, but a substantial portion of the refurbishing has yet to be completed.

Maritime industry sources said that Royal Caribbean and Southwest had been bickering for some time about the timetable that governs the complex refurbishing job. Southwest, the sources said, believes that its crews have been forced to do additional work that was not specified in the contract with Royal Caribbean.

The work stoppage has cast doubt on whether the ship, which arrived at Southwest’s bayfront yard in January, will be ready for a scheduled return to service June 17.

The Viking Serenade contract is important to Southwest because it has helped to replace work that is being lost as the Navy reduces the size of its fleet. In recent years, Southwest and other U.S. yards have grown almost totally dependent upon government repair contracts, with most commercial work being lost to foreign yards.

Arthur Engle, Southwest’s president, said earlier this month that Southwest, by successfully completing the $75-million contract, could prove to the world that its yard is competitive with European and Asian yards that now dominate the commercial shipyard business.

Southwest won the Viking Serenade contract in a heated competition with heavily subsidized shipyards in Germany and the Far East. The contract originally called for Southwest to complete the refurbishing in just 13 weeks.