New Tankers Ordered


September 2015


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The SIU already was gearing up to sail aboard four new tankers being built in Philadelphia – and now the union is poised to double that welcome assignment.


On Aug. 10, Aker Philadelphia Shipyard announced Kinder Morgan had purchased contracts for the construction of four, 50,000- dwt product tankers (one of which is in the earliest stages of construction). Although at press time the vessel operator’s identity had not been publicly disclosed, the union confirmed that SIU members will sail aboard the new ships.


It adds up to eight new SIU-crewed tankers from Aker that will sail in the Jones Act trade. The first ship in the first four-vessel order (for Crowley Maritime) – the Ohio – was expected to crew up in late August. The expected delivery dates for the recently announced order range from November 2016 to November 2017. All eight vessels (known as MT50 product tankers) will be essentially identical.


“This is fantastic news for the SIU, for the shipyard and for supporters of the Jones Act,” stated SIU Vice President Contracts George Tricker. “It means job security for the membership, and we absolutely are ready to provide all the manpower that will be needed.”


The MT50 ships will be LNG-conversion- ready, and each will have a capacity of 337,000 barrels. They will be slightly more than 600 feet long and will be able to sail at 15 knots. According to the shipyard, the most recent four-ship order is valued at a total of $568 million.


Kristian Rokke, chairman of Aker Philadelphia Shipyard, stated, “We are pleased to announce today’s transaction with Kinder Morgan as a successful outcome for Philly Tankers’ shareholders. Philly Tankers (an Aker Philadelphia entity) has made noteworthy achievements since its inception, including securing longterm employment for two of its vessels, the opportunistic exercise of its options and now the assignment of all four of its new building contracts to Kinder Morgan, which provides an attractive return to Philly Tankers’ shareholders.”


“There continues to be strong demand for domestic waterborne transportation to move petroleum products and crude oil, and our fleet of highly efficient tankers will provide stable, fee-based cash flow to KMI shareholders for many years to come through multi-year contracts,” said Kinder Morgan Terminals President John Schlosser. “This latest transaction clearly underscores Kinder Morgan’s commitment to marine transportation of crude oil, condensate and refined products in the U.S. domestic trade.”


The Jones Act is vital to American’s homeland and economic security. It requires that cargo moving between domestic ports be carried on vessels that are built, crewed, owned and flagged American. The law helps support nearly a half-million jobs in the U.S., and a study by PricewaterhouseCoopers found the Jones Act contributes billions of dollars to the economy every year. It also helps maintain a pool of reliable, well-trained U.S. Merchant Mariners who would be available to sail on U.S. military support ships in times of need.

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