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EXECS FIGHT SHIP SCRAPPING PLAN

by NOELLA KERTES, American Metal Market

WASHINGTON, June 11 -- Leave shipbuilding to shipyards and shipbreaking to scrappers, two scrap industry executives told the House subcommittee on Coast Guard and maritime transportation. "The skill set required to dismantle obsolete ships is as different from shipbuilding as lumberjacking is from carpentry," Kevin J. McCabe, chairman of International Shipbreaking Ltd., told a subcommittee hearing. "They are all skilled labor, but they have completely different skill sets. "You don't ask Chrysler to scrap obsolete Jeeps for the Army. Why ask a shipbuilder to dismantle a ship?"

Kerry R. Ellis, an executive at Patapsco Recycling in Baltimore, Md., agreed. "They are of a different mindset. ... Shipyards are not shipbreakers."

The hearing was convened by Rep. Wayne T. Gilchrest (R., Md.) to examine the results of the Defense Department's ship-scrapping review. Patricia Rivers, who headed up the Defense panel, provided the subcommittee with an overview of the panel's recommendations, which included:

That the federal government still have the option of scrapping ships overseas.

Developing procedures to share information about potential ship-scrapping contractors.

Implementing a pilot project to determine the costs associated with dismantling a ship.

Conducting coordinated inspections of scrapping operations.

However, industry representatives had their own list of recommendations for the federal legislators. In his testimony, McCabe said that companies need multi-ship contracts and coordinated government oversight instead of gathering information through a pilot program. They also need to be located near the end customer and efficient transportation to get the best price for the scrap.

He suggested a number of ways to accelerate the takedown of ships, such as providing towing of vessels to qualified facilities and performance bonuses based on staying ahead of schedules while maintaining safety and environmental compliance.

David Watson, president and chief executive officer of Baltimore Marine Industries Inc., Baltimore, Md., asked the lawmakers not to allow ships to be exported overseas and suggested a pilot program being advocated by the Shipbuilders Council of America under which "competent certified shipyards" could be selected to dismantle ships.

Watson suggested that the costs of the pilot program be funded initially by the U.S. Navy "through the use of the moorage fees which they would be saving." The same day that the House subcommittee hearing on ship scrapping was held, two environmental organizations criticized the Defense Department panel's report, saying it failed to recognize the Basel Convention and other international agreements that could prohibit the export of hazardous wastes to Third World countries.

However, a State Department source said it was not clear whether dismantled ships would be considered hazardous waste under the Basel Convention.

Armando Roggio, Philadelphia, contributed to this story.

(c) 1998 Chilton Media Inc. All rights reserved.

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