General Dynamics NASSCO Wins Oiler Contract
General Dynamics NASSCO has been awarded a contract by the U.S. Navy for the detailed design and construction of the next generation of fleet oilers, the John Lewis class (TAO-205), previously known as the TAO(X).
The contract is for the construction of six ships is worth around $3 billion. Designed to transfer fuel to U.S. Navy surface ships operating at sea, the oilers will have the capacity to carry 156,000 barrels of oil, including the Navy's new biofuels. The oilers also offer a significant dry cargo capacity, aviation capability and will reach a speed of 20 knots.
The contract is part of the Navy’s plans for 17 oilers, and the entire project is expected to cost around $8 billion. NASSCO is expected to try to win all of the work, and build the 700-foot vessels at its shipyard in Barrio Logan, San Diego.
The new contract is the largest group order that the yard has won from the Navy since the early 2000s. The San Diego Union Tribune reports that NASSCO was operating at capacity last year building 10 commercial tankers and container ships. NASSCO will deliver a record six ships this year, a figure that will fall to one in 2017.
The first ship of the oiler program was funded in the Navy’s FY2016 budget, allowing engineering and design work to begin immediately. NASSCO is expected to take two years to design the new oilers, which could slow production at the yard which currently employs around 3,600 people.
The U.S. Navy's FY2017 budget requests advance procurement for a second ship, with procurement expected to occur in FY2018.
NASSCO maintains an extensive history of building ships for the U.S. Navy. Similar to the TAO-205 program, NASSCO shipbuilders recently completed a 14-ship T-AKE program for the U.S. Navy.
Currently, the San Diego-based shipbuilder is under contract to construct its fourth Expeditionary Sea Base (ESB) for the U.S. Navy, USNS Hershel Williams, and is under contract to procure long-lead time material and engineering support for a fifth ESB.