Coast Guard Awards $110 Miilion Contract to Build Offshore Patrol Cutters

A rendering of Eastern Shipbuilding Group’s preliminary design for the Offshore Patrol Cutter. Image courtesy: Easter Shipbuilding Group

After a thorough evaluation process lasting more than two years, the U.S. Coast Guard has selected Eastern Shipbuilding Group of Panama City, Florida to design and construct up to nine Offshore Patrol Cutters.

The contract calls for the finalized design and production of the lead Offshore Patrol Cutter (OPC) with up to eight follow-on vessels. The contract is valued at $110.29 million and has a potential value of $2.38 billion if all nine are built.

The Coast Guard has described the acquisition of the offshore patrol cutter as its highest investment priority, and the program is said to be the largest vessel procurement contract in the history of the service. The Coast Guard plans to build a total of 25 OPCs representing a total investment of more $10 billion.

The OPCs are to replace the aging service’s aging fleet of 29 medium endurance cutters, some of which are more than 50 years old.

“The OPC will be the backbone of Coast Guard offshore presence and the manifestation of our at-sea authorities,” said Commandant of the Coast Guard Adm. Paul Zukunft. “It is essential to stopping smugglers at sea, for interdicting undocumented migrants, rescuing mariners, enforcing fisheries laws, responding to disasters and protecting our ports.”

In 2014, Eastern Shipbuilding was among three shipyards selected to provide preliminary and contract design for the first phase of the project. The two other shipyards included Bollinger Shipyards of Lockport, Louisiana and General Dynamics Bath Iron Works in Maine. The second phase (Phase II) was only to be awarded to a single shipbuilder and consists of the detailed design and construction contract.

Eight shipbuilders originally provided draft designs for the cutters.

Brian D’Isernia, Eastern CEO and Joey D’Isernia, Eastern President expressed their absolute confidence in the ability of ESG to secure this contract. Joey said,

“We knew from the beginning, that the U.S. Coast Guard would appreciate our excellent performance record of on time delivery of high quality vessels built by our first-rate craftsmen,” said Joey D’Isernia, President of Eastern Shipbuilding.

Construction of the first vessel is expected to commence in 2018 with delivery anticipated for fiscal year 2021.

“Securing this contract was based on Eastern’s reputation as an industry leader in the construction of mid-range tonnage commercial ships,” Eastern Shipbuilding said in a statement. “With a record of delivering 149 out of 150 ships on time and on budget since 2002, Eastern’s performance record is unmatched. Over the past 10 years, Eastern has delivered vessels, ranging from 80 feet to 433 feet in length, many with complexity comparable to the Offshore Patrol Cutter. Efficient, commercially based production processes ensure affordability in the construction of these Coast Guard vessels.”

Eastern Shipbuilding currently employs more than 1,500 employees. Since 2008, it has spent more than $75 million in upgrades and expanding its shipbuilding facilities.

“We believe that the Coast Guard is going to get the best value for its money and the finest vessels to succeed in its mission,” added Brian D’Isernia, Eastern’s CEO.

Update: GAO Study Finds Significant Risks in Coast Guard’s Offshore Patrol Cutter Program