Struggling yard secures barge contract

New vessel construction will return to the Portland Shipyard in the USA for the first time in years under a contract announced Tuesday. New venture U.S. Barge expects to deliver its first ocean-going barge to Young Brothers Ltd. in Hawaii in September 2007. U.S. Barge is co-owned by Vigor Industrial and Oregon Iron Works Inc. The shipyard primarily repairs U.S. military and Alaska ferry vessels.

The contract to build four barges allows Oregon Iron Works to expand into larger-vessel building. U.S. Barge expects to invest $8 million in equipment, such as a 1,000-tonne gantry crane on Swan Island, and hire about 100 workers.

Vigor, a holding company for Cascade General Inc. which took over the shipyard when the Port of Portland sold it in 2000, had planned to dramatically expand ship-repair work. Ten months later, he announced that business setbacks had forced him to sell the crown jewel of the yard, Dry Dock 4, to a Bahamas shipyard. The West Coast’s ship-building and ship-repair industry has all but dried up because vessels can be built and renovated more cheaply in China, Korea and elsewhere.

But Chandra Brown, an Oregon Iron Works vice president, said barge demand is surging, in part because higher fuel prices make barge movement a less costly transportation option. Alan Sprott, a Vigor vice president, said the barge contract marked a milestone in the shipyard’s recent years of struggle. “For a long time, this facility has been underutilized,” he said.

Seth Hudson, a Portland Development Commission senior economic development manager, said U.S. Barge has applied for a five-year property-tax waiver on new investments. The property falls within in the city’s North/Northeast enterprise zone.

If the application is approved by the PDC’s board, the city would waive most taxes on new buildings or equipment. In exchange, the company must offer well-paying jobs and focus on hiring employees from North and Northeast Portland.