USCG ends deal with Bollinger

The US Coast Guard has canceled a $488 million contract with Bollinger Shipyard after the hulls on some of the vessels the Lockport company upgraded cracked and buckled. Of the eight vessels upgraded by Bollinger, four are experiencing “hull deformities,” the Coast Guard said. Two others are still in the process of being upgraded.

The problems surfaced early on when the ?Matagorda?, the first vessel upgraded under the contract, was delivered to Key West, Fla., in September 2004. The next day, it was moved to Miami to avoid Hurricane Ivan and after the trip to Miami, the crew discovered a 6-inch crack in the ship and found a buckle in the hull, according to the Navy Times.

The Coast Guard had been counting on using the upgraded boats until a fleet of newer, larger boats could be built. With the contract now cancelled, the maritime agency will have to speed up development of a new class of fast-response cutters.

In addition, termination of the contract brings to a halt the first part of an extensive $24 billion plan to replace the USCG’s deepwater fleet of patrol boats and aircraft over 20 to 25 years. It also ends an agreement that would have kept close to 200 people working in Louisiana for seven years.

The contract called for Bollinger to convert 49 ageing, 110-foot Coast Guard patrol boats into 123-foot vessels with new equipment and enhanced capabilities. The upgrades also involved installing electronic equipment and improving onboard accommodation. But the advanced deterioration of the cutters, which are no younger than 14 years, led to increased costs and technical difficulties that meant the conversions were not a viable option. The hulls on many of these vessels were in worse shape than expected when the upgrades began.

The ill-fated ?Matagorda?, for example, needed to have 35% of its hull replaced, not 15% as expected. The designs to upgrade the vessels to 123 feet were “inherently flawed,” according to the Navy Times. Bollinger was part of a team of four companies that in June 2002 won the contract to perform the upgrades. The team was headed by defense contracting giants Northrop Grumman Corp. and Lockheed Martin Corp. and also includes Bollinger’s Lockport yard and several VT Halter Marine shipyards in southeast Louisiana and southern Mississippi. Most of the work, however, was to be done by Bollinger.

A spokesperson for Integrated Coast Guard Systems, the name given to the Northrop Grumman-Lockheed Martin partnership, said the decision to cancel the contract wasn’t a reflection of the work done by Bollinger. Rather than upgrading the older vessels at a cost of $8 to $10 million per vessel, the USCG said it will put money into new platforms, platforms that would be designed to meet their new mission and they will move forward with construction of the fast-response cutters, which could be ready as early as 2007.