Eastern Shipbuilding Suspends OPC Program
Eastern Shipbuilding Group (ESG) CEO Joey D’Isernia has confirmed that the shipyard is moving on from its Offshore Patrol Cutter (OPC) contract with the U.S. Coast Guard, citing financial loss with the program and staffing cuts.
“Eastern Shipbuilding Group has made the difficult decision to suspend work on the Offshore Patrol Cutter program due to significant financial strain caused by the program’s structure and conditions,” D’Isernia said in a statement. “Despite our best efforts, continuing under the current circumstances is not sustainable. Unfortunately, we also had to reduce our workforce—an extremely hard step, as our people are the strength of this company.”
Those moves were necessary to keep the shipyard on a solid footing for other projects, he said.
“This action allows us to remain financially stable and focused on delivering for our government and commercial customers,” D’Isernia said.
The move is the latest troubled chapter for the OPC program, which has yet to see a vessel put into service, despite the initial detail design contract awarded to Eastern Shipbuilding Group in September 2016. Construction on the first OPC, named Argus, began in 2018 just before Hurricane Michael made landfall as a catastrophic category 5 storm near the shipyard. The storm peaked at 160 mph sustained winds just before landfall on October 10, 2018, near Mexico Beach.
Damage from the storm delayed delivery of the Argus, and while the Coast Guard initially awarded contracts to Eastern for the second, third and fourth OPCs, the agency, in view of mounting delays to the Argus, awarded the next batch of hulls to Austal USA in nearby Mobile, Ala. ESG challenged the awarding of the second batch of OPCs but lost that appeal.
Eastern launched the Argus in October 2023, and the vessel now resides in San Pedro, Calif. However, the cutter continues to be outfitted, with a completion date not anticipated before the end of 2026. This past summer, the U.S. Department of Homeland Security announced the termination of the contracts for ESG to build OPCs 3 and 4.
The fates of the Argus and hull two remain unclear, but D’Isernia said the shipyard is ready to turn the page.
“Our shipyards will continue to build quality American vessels and support the regional economy,” he said. “We’ve overcome a major hurricane and global pandemic, and we will overcome this challenge as well.
“We are grateful for our team’s professionalism and for the ongoing trust of our customers and community,” D’Isernia said. “Eastern Shipbuilding Group remains firmly committed to American shipbuilding.”
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Featured photo caption: The U.S. Coast Guard Cutter Argus is launched October 27, 2023, at Eastern Shipbuilding Group’s shipyard in Panama City, Fla. The Argus is the first ship of the Coast Guard’s Heritage class of medium endurance offshore patrol cutters. (Photo by Coast Guard Petty Officer Brandon Giles)
