TOTE Secures $324 Million in Government Financing for Dual Fuel Containerships

An artist's rendering of new TOTE ships,  Image: General Dynamics NASSCO
An artist’s rendering of new TOTE ships, Image: General Dynamics NASSCO

U.S. Transportation Secretary Anthony Foxx today announced the approval of a $324.6 million Title XI loan guarantee to TOTE Shipholdings, Inc. to finance the construction of two of the world’s first LNG-fueled containerships.

“This is proof-positive that when we work to build America’s green energy economy, we can directly support the creation of meaningful jobs, supporting the President’s goal to strengthen America’s middle class,” said U.S. Transportation Secretary Anthony Foxx. “This one action significantly decreases emissions, supports jobs from one coast to the other, bolsters the Nation’s manufacturing base, and continues growing our economy.”

The vessels are being built at the General Dynamics NASSCO shipyard in San Diego, California. Construction of the vessels is expected to generate some 600 new jobs at NASCCO alone, MARAD says, as well as provide for 60 new U.S. merchant mariner jobs once completed and countless other opportunities for suppliers and equipment manufacturers.

“The shipbuilding industry contributes more than $36 billion to our national economy,” said MARAD Administrator Paul ‘Chip’ Jaenichen. “The Obama Administration remains committed to our shipping industry, which does more than just create jobs and new opportunities, but also strengthens local economies.”

TOTE’s new 3,100 TEU “Marlin-class” containerships will each be equipped with a single low speed, dual-fuel ME-GI engine capable of running on primarily on LNG, which will make them among the most environmentally friendly containerships in the world.

Delivery of the Marlin-class ships is expected for late 2015 and early 2016, at which point the vessels will operate in the U.S. Jones Act market between Jacksonville, Florida and San Juan, Puerto Rico. TOTE’s contract with NASSCO includes options for up to three additional ships. The first steel was cut at NASSCO in February.

The Title XI Loan Guarantee program promotes the growth and modernization of U.S. shipyards and the U.S. merchant marine by ensuring the U.S. vessels are manufactured in U.S shipyards by U.S. workers.

The Title XI program guarantees the repayment of loans, obtained in the private sector by ship owners, for the construction reconstruction, or reconditioning of vessels in U.S. shipyards. MARAD currently guarantees approximately $1.7 billion in U.S. shipyard projects.

Full Coverage: TOTE’s Marlin-class Containerships