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Navy issues penny contract for ship dismantling

The U.S. Navy has given ESCO Marine a contract with a value of just a penny for the dismantling of the decommissioned aircraft carrier Saratoga, but the company will own the scrap metal.
By Richard Tomkins   |   May 9, 2014 at 9:55 AM   |   Comments

WASHINGTON, May 9 (UPI) -- The U.S. Navy has awarded a $0.01 contract for the dismantling and recycling of the decommissioned, conventionally powered aircraft carrier Saratoga.

The penny contract was issued to ESCO Marine, of Brownsville, Texas, which will own the scrap metal from the dismantled ship.

"The price reflects the net price proposed by ESCO Marine, which considered the estimated proceeds from the sale of the scrap metal to be generated from dismantling," the Navy said. "This is not a sales contract, it is a procurement contract -- $0.01 is the lowest price the Navy could possibly have paid the contractor for the towing and dismantling of ex-Saratoga."

The Saratoga (CV60) is a Forrestal-class carrier commissioned into service in 1956. It participated in the Vietnam War and was decommissioned in 1994.

ESCO Marine is now developing plans to tow the vessel from its berth at Naval Station Newport, Rhode Island, to the company's facility in Texas. The plan requires Navy approval.

The towing is expected to take place this summer, the Navy said.

The Navy award is the second of three the Navy has given for dismantling a decommissioned aircraft carrier. All Star Metals of Brownsville, Texas, was contracted late last year to tow and dismantle the ex-USS Forrestal. A third contract is in the works for International Shipbreaking Ltd. of Brownsville to dismantle the ex-USS Constellation.

"After the initial award of one carrier to each successful offerer, the Navy has the capability of scrapping additional conventionally powered aircraft carriers over a five-year period under delivery orders competed between the three contractors," the Navy said.

Topics: Rhode Island
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