Eastern Shipbuilding Suspends Work on Offshore Patrol Cutter Program

 

Florida-based Eastern Shipbuilding Group (ESG) has finally made the tough decision of suspending work on the troubled Offshore Patrol Cutters (OPCs) program, a development that comes six months after the Trump administration announced partial termination of the contract owing to delays and cost overruns.

ESG CEO Joey D’Isernia announced that owing to the significant financial strains caused by the program’s structure and conditions, the company has opted to suspend work on its in-construction Heritage-class OPCs, resulting in layoffs.

The OPC vessels, which are 360 feet in length with a top speed of 22.5 knots, are designed to bridge the capabilities of the oceangoing 418-foot national security cutters and the 154-foot fast response cutters. With an endurance of 60 days, the Heritage-class is needed to replace the 270-foot and 210-foot medium endurance cutters, many of which are past retirement age.

The decision has immediate effects for the first and second OPC hulls. The first, USCGC Argus, was launched in 2023 and was in outfitting for delivery in 2026. The unfinished Argus' fate has not been clarified, but there had long been concerns: Congressman Mike Ezell complained earlier this year that Argus was delivering "four years late, and with a host of non-compliant parts."

The Trump administration has already terminated the orders for the third and fourth hulls in the series. The Coast Guard put these hulls on hold in June this year, even though early stages of work had started on both of them, and then the Department of Homeland Security formally canceled the orders in July. 

The OPCs program began in 2016 when the Coast Guard selected the detailed design from ESG and went on to award the contract the following year, anticipating the first cutter would be delivered in 2021. The USCG has plans to acquire 25 OPCs, and the program promised long-term prosperity for ESG. But the yard suffered setbacks, starting with a category five hurricane in 2018, and could not catch up. The Coast Guard split the original contract and awarded hulls five through 11 to competitor Austal USA, leaving ESG with four. 

ESG has now opted to suspend the program altogether, according to a statement sent to media outlet WMBB News 13.

“ESG has made the difficult decision to suspend work on the OPC program due to significant financial strain caused by the program’s structure and conditions. Despite our best efforts, continuing under the current circumstances is not sustainable,” said ESG President Joey D’Isernia in a statement to local media. “Unfortunately, we also had to reduce our workforce — an extremely hard step, as our people are the strength of this company.”

He went on to say that the action will allow the company to remain financially stable and focused on delivering it other contractual obligations. “We’ve overcome a major hurricane and a global pandemic, and we will overcome this challenge as well,” he noted.