Vigor Alaska to build 2 ferries in Ketchikan

Alaska’s newest ferries will be the first made in the state after all.
Gov. Sean Parnell announced an agreement Sept. 20 between the state and Vigor Alaska to construct two Alaska Class ferries at Vigor’s Ketchikan shipyard.
Vigor Alaska estimated in a company release that the pair of 280-foot Alaska Marine Highway System ferries can be built for $101 million total, less than the state’s $120 million Vessel Replacement Fund budget.
“These vessels will be the largest ships ever built in Alaska,” Parnell said at an event in Ketchikan announcing the agreement. “Building these ferries in-state will be a major boost for Alaska’s economy. This has been our intent during the entire process.”
The state was able to control where the vessels are built by not using federal funds, which would require going through the federal procurement process that requires the lowest construction bid be accepted.
While the vessels are projected to be finished with money to spare, the delivery date has been pushed back more than a year to sometime in 2018, according to Parnell’s office. The project timeline on the Marine Highway System website forecasts a 2016 delivery.
Vigor Alaska’s business development lead Doug Ward said the timeline was revised in negotiations with the state in part to minimize cost. Vigor will be able to manage its workforce and reduce labor costs with longer lead times, he said.
The day ferries will mainly run in Lynn Canal between Haines-Skagway and Juneau. They are designed to hold up to 300 passengers and carry 53 vehicles.
The state currently has 11 ferries in its fleet, some of which are nearly 50 years old. Once the Alaska Class vessels are up and running one of the state’s aged mainliner ferries will likely be retired, AMHS officials have said.
The Alaska Class ferries are called day boats because they are designed for one crew shift voyages without cabins or crew living quarters to cut both capital and operational expense. This is a change from earlier plans to add a traditional mainline vessel to the fleet.
“You’re essentially getting two vessels for the price of one,” Ward said.
About a year behind the Alaska Class process, the Marine Highway also is designing a mainliner to replace the M/V Tustumena, which serves Kodiak, Homer and all of the Aleutian ports.
Early work on the day-boat project is scheduled to start in the coming weeks.
Ward said Vigor Alaska, formerly Alaska Ship and Drydock, plans to hire up to 80 full-time shipbuilders for the four-year project and ultimately grow its Ketchikan-based workforce to 250 employees. At the beginning of 2014 Vigor had 160 employees in Southeast Alaska.
A new project delivery method and the fact that the ferries will be identical will both help reduce overall cost, Ward said.
“You have a learning curve on the first vessel and then as that vessel’s getting midway into construction we can apply the lessons learned from the first vessel to assure that we stay within budget and within schedule,” he said.
Major steel construction on the second vessel will commence when the first is about 50 percent to 60 percent complete.
The Alaska Marine Highway System and Vigor Alaska project is the first time ever that a ship — in this case two — has been built using the construction manager-general contractor, or CMGC, delivery method, according to Ward. By moving away from the traditional design-bid-build process, in which “low bid takes all,” as he described, Ward said the state and shipbuilder can work closely together during the entirety of construction and mitigate the risk of delays and cost overruns.
The CMGC method removes the opportunity for large magnitude change orders that often occur during construction under design-bid-build, he said.
Under the traditional method the project owner typically selects a builder when it has a 65 percent concept design and the builder works through the technical design prior to construction.
“During that detailed design period, that’s when you start uncovering issues of constructability — if you put the engine over here you can’t change the oil filter, things like that,” Ward said.
Vigor used the CMGC process when it built the ship assembly hall in Ketchikan in collaboration with the state, which owns the shipyard property through the Alaska Industrial Export Authority.