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SCA Weekly Report | October 18 - 22, 2021

Shipbuilders Council of America

20 F Street NW, Suite 500

Washington, DC 20001




SCA Weekly Report | October 18 - 22, 2021





Thank you again to everyone that joined us last week for the 2021 SCA Fall Membership Meeting in San Diego. For your reference, the speaker presentations are below:


  • The SCA staff reports can be accessed HERE.
  • Bradley Byrne's presentation can be accessed HERE.
  • Domenic Carlucci's presentation can be accessed HERE.




HASC Schedules Depot Maintenance Hearing

Next week, the House Armed Services Committee (HASC) Subcommittee on Readiness will hold a hearing on “Depot Maintenance and Modernization.” In the context of a national discussion on infrastructure, and given the $900 million increase for organic industrial base recapitalization included in the House-passed NDAA, this hearing will focus on the requirements, plans, and resources needed to modernize and optimize the infrastructure, facilities, processes, and equipment at the military depots. Jay Stefany, Acting Assistant Secretary of the Navy for Research, Development and Acquisition will be one of the featured panelists. 




President Biden Nominates Phillips to Be Next MARAD Administrator

President Biden has nominated Rear Adm. (Ret.) Ann Phillips to be the next Maritime Administrator. A White House statement said Phillips is a leader in the field of coastal resilience and climate impact on national security at the regional, national and international level. Prior to her current appointment, Phillips served nearly 31 years on active duty in the U.S. Navy, retiring as a rear admiral. Her final flag command was as commander, Expeditionary Strike Group TWO, including 14 ships and 10 subordinate commands — all the Amphibious Expeditionary Forces on the U.S. East Coast.


Biden Says U.S. Would Defend Taiwan from China

President Joe Biden said the U.S. was committed to defending Taiwan from a Chinese attack, in some of his strongest comments yet as the administration faces calls to clarify its stance on the democratically ruled island.


Biden answered “yes” when asked during a CNN town hall yesterday whether he could pledge to protect Taiwan. “I don’t want a Cold War with China -- I just want to make China understand that we are not going to step back, we are not going to change any of our views,” Biden told host Anderson Cooper in Baltimore.


Pressed whether he would come to Taiwan’s defense if China tried to attack, Biden responded: “Yes, we have a commitment to do that.” A White House spokesperson said that Biden didn’t announce a change in U.S. policy toward Taiwan. The U.S. would continue to uphold its commitment under the Taiwan Relations Act, support Taiwan’s self-defense and oppose unilateral changes in the status quo, the spokesperson said.


The Biden administration has faced growing calls to clarify the American commitment to defending Taiwan as Xi ramps up diplomatic and military pressure against its popularly elected government. Beijing views the island as part of its territory and has reserved the right to use military force to bring it under its control.




Navy Releases Report on Bonhomme Richard Fire

A U.S. Navy investigation released on Wednesday found that a fire aboard a warship last year, which was caused by arson, was preventable and that a series of failures after it started led to the destruction of the ship.


More than 60 people, including about 40 sailors, were treated for minor injuries during several days of fighting flames on the 844-foot-long (257-meter) amphibious assault ship Bonhomme Richard, which was docked for maintenance at its home port at U.S. Naval Base San Diego.


A U.S. Navy sailor was charged earlier this year with starting a fire which eventually destroyed the ship. But an investigation found that after the fire was started, commanders in the Navy and sailors aboard the ship were responsible for a series of failures.


The report said that the crew on the ship lacked a basic knowledge of firefighting, there was ineffective oversight by commanders and the ship did not have proper heat detection capabilities.


On the morning of the fire, the report said, 87 percent of the ship’s fire stations were in “inactive equipment maintenance status.”

“The loss of this ship was completely preventable,” Admiral William Lescher, the vice chief of naval operations, said.


Navy Re-Evaluating Shipyard Improvement Program Cost Following Portsmouth Cost Overruns

After the bid for shipyard improvements at Portsmouth Naval Shipyard in Maine came in far above estimates, the Navy is re-evaluating the cost of its ongoing 20-year, $21 billion Shipyard Infrastructure Optimization Program. Navy spokesman Lt. Lewis Aldridge told Inside Defense in a statement Monday that SIOP costs have increased since the initial estimate.


Vice Chief of Naval Operations Adm. William Lescher told the House Armed Services readiness subcommittee in June that the Navy received just one bid for the work at Portsmouth which was well above what the Navy expected.


The Navy awarded Nebraska-based 381 Constructors a $1.7 billion contract to build a multimission dry dock at Portsmouth in August.


The Senate Armed Services Committee expressed worry about the over 150% cost overrun for the Portsmouth project in the report accompanying its fiscal year 2022 defense authorization bill, released in September. The overrun “not only costs finite resources, it risks unacceptable delays for a project that is essential for maintaining the submarine force,” the report states.


Aldridge said the Portsmouth project involves constructing a partitioned addition to the shipyard’s Dry Dock 1 to enable the simultaneous docking of three submarines.




U.S. Planning Offshore Wind Farms from Maine to California

The United States plans to hold up to seven offshore wind auctions in the next four years and will extend its ambitions to areas that have yet to be developed such as off the coast of California and in the Gulf of Mexico, a Biden administration official said last week. The announcement comes as the administration is looking to bolster the nascent industry as part of a plan to address climate change by decarbonizing the power sector by 2035.




South Korea’s Hanjin Shipyard Wins First Commercial Order in Six Years

Six years after being forced to leave the commercial newbuilding business due to financial troubles, South Korea’s Hanjin Heavy Industries & Construction announced it has won its first commercial shipbuilding contract since 2015. The order comes as the shipbuilder completed a reorganization last month after being acquired in the spring of 2021. The new order is for four 5,500 TEU containerships that are being built for an unnamed European shipping company. Hanjin reported that it will build a class eco-friendly container carrier designed to reduce greenhouse gas emissions while reducing energy consumption. The contract, which was valued at approximately $270 million, calls for the delivery of the vessels before November 2023.


China Signs Huge LNG Deals with U.S. Supplier Venture Global

China just recently agreed to multiple liquefied natural gas (LNG) deals with U.S. exporter, Venture Global LNG, as the world's second-biggest economy looks to secure long-term supplies amid soaring gas prices and domestic power shortages. According to documents posted on the U.S. department of energy website, the agreements with China's state oil giant, Sinopec, include two 20-year deals for a combined 4 million tons of LNG per year.


For China - which has this year overtaken Japan as the world's top LNG buyer - the deals will be its single largest LNG trade agreement in terms of volumes without an equity stake, a senior Beijing-based gas industry source said.




New Record: 100 Vessels Are Waiting to Berth at LA / Long Beach

The twin ports of Los Angeles and Long Beach have hit yet another new congestion milestone: a record 100 ships are waiting at anchor or in drift zones, including 70 container ships. Following pressure from President Joe Biden, LA / Long Beach terminal operators have agreed to transition to 24/7 gate hours. However, extended hours are not expected to resolve the supply chain crisis at a single stroke: the backlog is just as serious in rail yards, truck depots and warehouses.


"These issues go through the entire chain, from ship to shelf," Secretary of Transportation Pete Buttigieg told ABC. "That's why we're not just working with the ports. It's the truckers, the rail companies, the operators and also those retail companies that are at the other end of those supply chains."


Sea Machines Completes World's First 1,000 Nautical Mile Autonomous Voyage

Sea Machines Robotics, the developer of autonomous command and control systems for the maritime industry, recently announced that it has completed the world’s first 1,000+ nautical mile autonomous and remotely commanded journey of a commercial vessel at sea. The autonomous tug Nellie Bly completed its journey in just 129 operational hours over 13 days. The program was commanded by U.S. Coast Guard-licensed mariners remotely stationed 3,000 miles away in Boston, many of whom are also members of the American Maritime Officers union.


Wreck Removal Crews Begin Lifting Golden Ray’s Final Section

The operation to remove the final section of the Golden Ray wreck kicked off last weekend in St. Simons Sound, Georgia, putting the end to the years-long wreck removal operation finally in sight. Wreck removal personnel began lifting Section Four, the final section, on Saturday. The lifting of the final section comes more than two years after the Golden Ray car carrier capsized as it departed the Port of Brunswick with over 4,100 vehicles inside. The NTSB determined the probable cause of the capsizing was the chief officer’s error entering ballast quantities into the stability calculation program, which led to his incorrect determination of the vessel’s stability.




If you have any questions, please do not hesitate to contact the SCA staff.