Princess Cruises and BAE Systems San Francisco Ship Repair will invest $5 million to upgrade a drydock facility at the Port of San Francisco, making it the only drydock repair facility on the West Coast that can accommodate vessels in the 100,000-gross-ton range.

"We have three large ships positioned ... on the West Coast," said Dean Brown, executive vice president of Princess. "Strategically, it was important to develop the capability to be able to drydock them here." 

The three parties reached an agreement to upgrade the facility, named Drydock No. 2, at San Francisco's Pier 70.

Princess and BAE, a ship repair, modernization and conversion company, will provide the funding to stabilize and upgrade the drydock, and the port will give BAE rent credits for the remaining 10 years of the company's lease on the state-owned shipyard property. 

Princess will pay for $3 million of the facility's improvements and would be reimbursed based on the performance of the shipyard; Brown would not say what the level of performance would have to be. In addition, Princess ships and other ships in the Carnival Corp. family will get preferential berthing rights at the port.

Dean said that having the facility would give the cruise line better flexibility with its deployments. Previously, he said, a post-Panamax Princess ship operating on the West Coast and in need of drydock services would rotate its deployment to the South Pacific in order to do the work in Singapore.

The definition of a post-Panamax ship means it is too big to fit through the Panama Canal, so vessels have to sail around Cape Horn to get to an East Coast facility.

Gerry Roybal, the maritime marketing manager for the port of San Francisco, said that the facilities would bring additional ships to the West Coast in general, and San Francisco specifically. He predicted that if the lines were able to bring larger ships to busy year-round California ports like Long Beach and San Diego, they would shift midsize vessels to other ports such as San Francisco and Seattle.

"We think we'll be able to generate more market for the entire West Coast just by giving the cruise lines the capability to position their large ships out here," he said.

Ira Maybaum, general manager of BAE's San Francisco location, said the drydock facility would be able to handle Princess' and Carnival Cruise Lines' largest ships, but Royal Caribbean International's Voyager-class vessels would be too large.

Royal said that port had discussed modifying the dry-dock capability to accommodate Voyager-class ships, but it would have cost about $30 million to do so.

This is the first investment Princess has made in a dry-dock facility.  "When we decided to keep the ships here, we decided to work with the port and develop the capability to drydock the ships here," said Brown.

Princess has already reserved the San Francisco facility for scheduled hull repairs and topside renovations on two of its 109,000-ton ships, the Star Princess in fall 2008 and the Golden Princess in spring 2009.    

To contact reporter Johanna Jainchill, send e-mail to [email protected].

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