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Three Wire - A Journal of Naval Aviation (www.threewiremagazine.com) coming this fall!

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DOT Assessing Cost of Road Clearance, Air Traffic Operations Survive Hurricane Rita Mostly Unscathed

Washington September 26, 2005 - The Department of Transportation is working with state and local officials to assess the cost of road clearing so Emergency Relief funds can be made available in the wake of Hurricane Rita, Secretary of Transportation Norman Y. Mineta announced today. Mineta added that transportation equipment needed to restore normal travel patterns in the area survived Hurricane Rita largely unscathed, including air traffic control facilities at most of the region's commercial airports.

"We have the equipment and personnel in place to help get the Gulf Coast up and running as fast as possible," Secretary Mineta said. "Our focus is on making sure state and local officials have the resources and support they need to repair, rebuild and reopen for business."

Road crews are working throughout Texas and Louisiana clearing debris - including trees and power lines - from highways and bridges. Mineta noted that the Department is working with highway officials from both states to estimate the final cost of clearing the region's highways in order to begin providing needed Emergency Relief funds to help pay for the work.

In addition, the Secretary noted that the Department is doing the following to support the federal, state and local response to Hurricane Rita and last month's Hurricane Katrina:

Highways and Bridges

• The I-10 Bridge in Lake Charles, LA appears to be structurally sound despite reports that a barge may have collided with the bridge during the Hurricane. Once cleared of debris, the bridge should be reopened to traffic this week.
• Resuming work to repair the I-10 Twin Span Bridges between New Orleans and Slidell, LA. Work was temporarily halted over the weekend in preparation for Hurricane Rita.

• Moving ahead of schedule with repairs to the I-10 Bridge in Pascagoula, MS that was damaged during Hurricane Katrina. Repairs should now be completed sometime the first week of October.

Airports and Air Traffic Control

• Resuming air traffic control operations at airports in Texas and Louisiana that were temporarily affected by Hurricane Rita. FAA equipment was not damaged significantly by the Hurricane.
• All commercial airports in the region, except for the airports in Beaumont, TX and Lake Charles LA, are handling commercial traffic again.
  

Ships and Ports

• Working with other federal agencies and state and local officials to clear the Sabine River Channel so the ports of Beaumont, Port Arthur and Orange can reopen as quickly as possible.

Trucks and Supplies

• Continuing to provide relief supplies to the Gulf Coast region. As of the morning of September 26th, the Department has provided over 580 shipments, including 1 tanker of diesel fuel, 5,040 rolls of plastic, 43,760 tarps, 540,000 gallons of water, 2,736,000 meals ready to eat, 5,000 blankets, 21,000 cots and 73 generators.
  
  Buses
  

• Providing over 500 buses to Texas and Louisiana to support their efforts to return evacuated residents to coastal communities.
  

The Department stands by to provide any additional support that may be requested by the Federal Emergency Management Agency or from state and local officials, Mineta added.

Washington September 19, 2005 - Today the Bush Administration released its bill to reauthorize the Magnuson-Stevens Fishery Conservation and Management Act. The bill contains key elements to implement the President’s 2004 Ocean Action Plan and calls for a hard deadline to end overfishing. Additionally the bill provides Congress with clear and commonsense ways to strengthen the nation’s governance of ocean resources.

The Administration’s bill:

Building on the commitment in the U.S. Ocean Action Plan to promote greater use of market-based systems for fisheries management, Secretary Gutierrez pledges to work with the Fisheries Management Councils to double the number of dedicated access privileges programs by 2010.

This goal will bring eight new fisheries under market-based management programs. In the eight fisheries where DAP has been implemented since 1990, fishermen have enjoyed higher profits, lower costs, longer fishing seasons and a safer, more stable industry.

"Oceans are important to everyone and one of our highest priorities is to create a vibrant well managed fishery system that can provide healthy food and good jobs to Americans for generations to come," said Chairman Jim Connaughton, White House Council on Environmental Quality. "These new tools will help us toward ending over fishing and rebuilding our fish stocks."

The Magnuson-Stevens Fishery Conservation and Management Act is the nation’s premier fisheries conservation law. Originally developed in 1976, the Act provides for federal management of fisheries in the U.S. Exclusive Economic Zone. The Act establishes authority with the Department of Commerce, through the National Oceanic and Atmospheric Administration’s Fisheries Service and the eight regional fishery management councils, for management of U.S. fishing industries and conservation of living marine resources.

Maritime Administration Moves Ahead on Ship Disposal

Washington September 20, 2005 - The Maritime Administration (MARAD) today announced four new disposal contracts for obsolete ships in its National Defense Reserve Fleet. Two of the ships are in the James River Reserve Fleet in Virginia, and two are in the Suisun Bay near San Francisco, CA. Three of the ships will be dismantled in Brownsville, TX, and one in Chesapeake, VA.

"Our ship disposal policy of ‘worst first’ has worked for us," said Deputy Maritime Administrator John Jamian. "We have cleared out the ships in the worst condition, most of which were in the James River. Now we can work ahead and dispose of ships before the situation becomes so critical."

The Santa Lucia, a 1966-vintage cargo ship, currently in the James River site, will be towed to the Marine Metal facility in Brownsville, under the terms of a contract worth $565,827; the Pawcatuck, a tanker built in 1946, also in the James River, will go to Bay Bridge Enterprises of Chesapeake, under a contract worth $569,373. A contract for $1,299,327 to dismantle the 1958-vintage tanker Connecticut, now at Suisun Bay, was awarded to International Shipbreaking, Ltd., of Brownsville; and ESCO Marine, also of Brownsville, was awarded a contract to tow and dismantle the Nemasket, a tanker built in 1942, for $1,224,100.

"The removal of the Santa Lucia and the Pawcatuck is another positive step in the proper management of the James River Reserve Fleet," Senator George Allen said. "Along with members of the Virginia delegation, Deputy Maritime Administrator John Jamian, and other government officials, I will continue to work hard and remain vigilant to protect the James River and the interests of Virginians who depend on it for their recreation and commerce."

The James River Reserve Fleet and the Suisun Bay Reserve Fleet are two of the three National Defense Reserve Fleet (NDRF) anchorage sites. MARAD maintains the NDRF as a reserve of ships for national defense and national emergencies. When ships are no longer considered viable for defense or aid missions, MARAD arranges for their responsible disposal.

Washington September 15, 2005 - A vessel came ashore during heavy surf on September 14 in front of the NOAA Hawaiian Islands Humpback Whale National Marine Sanctuary office in Kihei, Maui. The vessel, a 45-foot trimaran named Sugarae, apparently broke loose of its moorings during a large south swell that impacted areas throughout South Maui.

Sanctuary staff reported that the vessel first came ashore on top of the submerged walls of a historic native Hawaiian fishpond, Ko‘ie‘ie Fishpond during hightide. A nonprofit group, ‘Ao‘ao O Na Loko I‘a O Maui, working to restore and revitalize the fishpond is planning a community celebration to officially kickoff restoration of the fishpond walls this Saturday. Ko‘ie‘ie Fishpond, located near Kalepolepo Park and the sanctuary office is a National Registered Historic site.

According to Kimokeo Kapahulehua, president of the fishpond association, "The boat grounded itself on the wall and proceeded to move down along the wall, scraping the rocks and damaging the algae which is an important nutrient and food source for the fish and small organisms living in the fishpond. Fortunately, we are just beginning the rebuilding of the wall; otherwise this boat would have destroyed an intact wall of the fishpond."

The U.S. Coast Guard is currently working to determine if materials on the vessel poses any threat of pollution. State officials are working to contact the vessel owner to have the vessel removed from the shoreline. In addition, sanctuary staff are working with NOAA Law Enforcement officials to investigate if any sanctuary regulations were violated.

The Hawaiian Islands Humpback Whale National Marine Sanctuary is administered by a partnership of NOAA’s National Marine Sanctuary Program and the State of Hawaii Department of Land and Natural Resources.

NOAA’s National Marine Sanctuary Program seeks to increase the public awareness of America’s marine environment and maritime heritage by conducting scientific research, monitoring, exploration and educational programs. Today, the program manages 13 national marine sanctuaries and one coral reef ecosystem reserve that encompass more than 150,000 square miles of America’s ocean and Great Lakes natural and cultural resources.

The National Oceanic and Atmospheric Administration, an agency of the U.S. Commerce Department, is dedicated to enhancing economic security and national safety through the prediction and research of weather and climate-related events and providing environmental stewardship of our nation’s coastal and marine resources. Through the emerging Global Earth Observation System of Systems (GEOSS), NOAA is working with its federal partners and nearly 60 countries to develop a global monitoring network that is as integrated as the planet it observes.

Hornbeck Offshore Fleet Escapes Rita Unscathed

Covington LA September 26, 2005 - Hornbeck Offshore Services, Inc. announced today that it has experienced no damage to any of its vessels as a result of Hurricane Rita, including those currently under construction or conversion in various Gulf of Mexico shipyards. In addition, the storm had no impact on the Company's vessel charters. The Company's new generation offshore supply vessel fleet continues to operate at pre-storm levels of 100% utilization.

No physical damage related to Hurricane Rita occurred to the Company's corporate headquarters in Covington, LA, which is now fully operational with all electrical power, Internet connectivity and telecommunications service having been restored since Hurricane Katrina caused a loss of utilities at that location as reported a few weeks ago.

In addition, all Hornbeck executives and other Covington-based personnel have returned from their temporary post-Katrina work locations and may now be reached through normal communication channels. All temporary offices and temporary telephone numbers previously established by the Company for Hornbeck executives are no longer in use.

Alliance Formed to Move Mississippi Casinos Ashore

Jackson MS September 26, 2005 - With millions in tax revenues lost daily because Mississippi's offshore gaming industry has been destroyed by Hurricane Katrina, and with banks and insurers reluctant to support new floating structures, business groups have formed an alliance to ask the State Legislature to allow reconstruction adjacent to the waters edge.

"The people of Mississippi benefit in many, many ways from the estimated $95 million in taxes that goes directly into the state treasury from the coastal gaming industry, and the fact is all of that is about to go away," said Woody Bailey, Chairman of Mississippians for Jobs. "The citizens of this state have suffered terribly from the storms, and it will be a tragedy if they have to suffer even more when state services are cut back because coastal casino tax revenues dry up."

Mississippians for Jobs, along with the Harrison County Board of Supervisors, the State Department of Tourism, Coastal Convention and Visitors Bureaus and other business groups, are calling on the State Legislature to approve measures allowing the coastal gaming industry to reconstruct the 13 resorts destroyed by Katrina slightly inland because banks and insurance companies have balked at plans for reconstruction over water.

"Look at all of the good this industry has done for our state, for roads, schools, medical care, public safety and economic growth in general in the past 12 years," said Beth Carriere, Director of Hancock County Visitors Bureau and President of Mississippi Coastal Visitors Partnership. "It would be a shame if the legislature failed to support this vital industry in its time of need, and essentially asked all Mississippians to get ready for huge budget and service cuts. It's a survival issue."

The whole state of Mississippi will feel the effects. "With inevitable budget cuts, children will lose teachers and the Highway Department will lose an estimated $20 to $30 million, said State Sen. Tommy Gollott, D-Biloxi.

The 13 coastal casino resorts destroyed by Katrina also attracted an estimated 3 million tourists to the region annually, generating millions of dollars more in tax revenues from retail sales, dining out, local entertainment, lodging and motor fuel purchases that benefited cities and towns throughout Mississippi. The resorts directly employed 17,000 people and more than 50,000 indirect employees.

If shore based reconstruction is approved, Mississippians for Jobs spokespersons say the new resorts will be larger and feature more amenities - qualities that will attract even more patrons, create more jobs and generate even more tax revenue to benefit all Mississippi citizens.

"We must also consider what sort of message it sends to businesses considering coming to Mississippi if we simply sit back and let a large part of an industry die," said State Sen. Ralph Doxey, R-Holly Springs. "Who will want to locate in a state that abandons an industry when it is down and out? I wouldn't."

Global SantaFe Reports Two Rigs Disappeared in Hurricane Rita

Houston September 26, 2005 - GlobalSantaFe Corporation today reported that two of its offshore oil and gas drilling rigs, the GSF Adriatic VII and GSF High Island III, could not be found on their drilling locations during a search by fixed-wing aircraft Sunday. There were no signs of any major damage from Hurricane Rita to the company's other rigs in the Gulf of Mexico.

GlobalSantaFe's fleet in the Gulf of Mexico includes nine jackup rigs, four semisubmersible rigs and one ultra-deepwater drillship, the GSF C.R. Luigs. The drillship relocated before the area was impacted by Hurricane Rita, and all other rigs were safely evacuated in advance of the storm.

All of the company's rigs are insured under a hull and machinery policy subject to a total deductible of $10 million for this event. The two missing jackup rigs had a combined net book value at June 30, 2005 of $22.2 million and are insured for a total of $125 million. The rigs contributed $5.3 million of the company's total $135.3 million of net income for the first six months of 2005.

Tiger Woods Lawsuit Against Vancouver Yacht Builder Goes Ahead

Miami September 26, 2005 - A federal court in Miami has ruled that golfer Tiger Woods' lawsuit against Christensen Shipyards, Ltd. will proceed in the U.S. District Court for the Southern District of Florida and that an order enjoining Christensen from the unauthorized use of Woods' name or photographs of his boat will remain in place.

Mr. Woods filed his rights-of-publicity suit against Christensen last October in the U.S. District Court for the Southern District of Florida. The suit alleges that the luxury yacht manufacturer, based in Vancouver, improperly used Mr. Woods' name, his wife's name, and photographs of a yacht built for Woods in connection with the advertising and marketing of Christensen's products. Mr. Woods also seeks injunctive relief from Christensen.

After a November 8, 2004 hearing, Chief Judge Howard J. Zloch entered a consent preliminary injunction prohibiting Christensen from improperly using Woods' name and photographs of the yacht to promote and advertise the company.

On December 8, 2004, Christensen filed a motion asking the Court to dissolve the preliminary injunction and dismiss the case under a "forum selection clause" in the yacht contract opting for Washington State Court to resolve certain disputes. Ms. Woods is not a party to the yacht contract and is not bound by the "forum selection clause."

On September 23, 2005, after extensive briefing on the issues, Judge Zloch denied Christensen's request and held that "the result of enforcement of the forum selection clause would be parallel proceedings in different forums on the same set of facts and legal issues ... The Court finds that enforcement ... would lead to ... unreasonable and, arguably, unjust results ..." In other words, enforcement of the clause would result in the unreasonable situation of requiring Woods to sue in Washington while his wife's case would proceed in Florida.

The Woods' attorney, J. Douglas Baldridge of Washington, D.C.-based Venable LLP, stated: "We firmly believe that the evidence will show Christensen violated and exploited the Woods' valuable rights for the company's own commercial gain. We are pleased with today's well-reasoned ruling and look forward to presenting the merits of this case in Florida where the Woods reside."

The case will remain in Florida and the preliminary injunction against Christensen remains in tact.

OMI Announces Vessel Sale, New Time Charter, Dispute Settlement and New Policy Regarding Tanker Rate Disclosure

Stamford September 26, 2005 - OMI Corporation of Stamford, Connecticut announced that it has agreed to sell the SABINE, a 1998-built Suezmax vessel. The vessel is expected to be delivered in the fourth quarter of 2005, at which time the Company will recognize a gain on the sale of approximately $27.5 million or $0.33 basic earnings per share. The Company had previously announced the sale of the PECOS, also expected to be delivered in the fourth quarter.

The Company has entered into a time charter agreement for the vessel THAMES, for one year commencing in October 2005. The time charter will add approximately $10.8 million to the contracted revenue of the Company, most of which will be received in 2006.

OMI also announced that its arbitration dispute relating to the failed delivery to it of a Suezmax tanker in August 2004 has been settled. The Company's deposit of $6.45 million has been returned to it, together with interest. No other payments were made by either party. There is no material affect on the Company resulting from the settlement.

The Company also announced that in order to provide better current information to investors, it adopted a new policy with respect to announcing rates being achieved by its vessels. Each month, the Company will announce the average daily time charter equivalent ("TCE") rates earned to that date for the portion of the current quarter's days then booked on its spot market Suezmaxes, its time chartered Suezmaxes, its spot market product carriers and its time chartered product carriers. Profit sharing amounts for vessels with profit sharing arrangements will not be included until earned for accounting purposes and are not included in any of the below TCE rates.

In the third quarter, we will recognize profit sharing for three product carriers.

As of September 23, 2005, the Company has achieved the following average estimated TCE rates by percentage booked for vessels operating in the third quarter:

Number of Percent

Number of Revenue of Days TCE

Vessels Days (a) Booked Rate (b)

---------------------------------------

Suezmax vessels on spot (c) 18 1,549 94% $30,500

Suezmax vessels on time charter 2 184 100% $30,000

(does not include profit sharing)

Product carriers on spot 9 800 100% $22,500

Product carriers on time charter 21 1,900 100% $15,200

(Does not include profit sharing)

(a) Revenue days are days the vessels are in our fleet and are not in drydock for our owned vessels or off-hire for our chartered-in vessels.

(b) Time charter equivalent ("TCE") rates are derived by calculating revenue from vessels operating on time charters and voyage revenue less voyage expenses from vessels operating in the spot market and dividing by the number of days in the applicable period. TCE revenue is used to measure and analyze fluctuations between financial periods and as a method of equating TCE revenue generated from a voyage charter to time charter revenue.

(c) Suezmax vessels on spot include 11 vessels owned, four vessels chartered-in and three vessels from pool participants operating in the Gemini Pool. The revenues of Gemini are reflected in OMI's consolidated revenues, and the charter hire expense for the non-OMI pool participants, which is based on the TCE revenue of the pool, are included in OMI's consolidated charter hire expense.

All numbers in the above table are estimates and may be adjusted depending on a number of factors. Those attempting to understand OMI's earnings must also take into consideration (1) drydock days; (2) timing of entry of new vessels into the Company's fleet (e.g. the time chartered in CAPE BONNY entered the fleet on September 17, 2005, and will therefore provide only a small affect on the third quarter results) and exits from the Company's fleet (e.g. the SABINE and PECOS are scheduled to be delivered in the fourth quarter, and will have less than a full quarter's affect on fourth quarter results); (3) profit sharing on ten vessels with profit sharing time charters arrangement is recognized once each year for each vessel (for example, there are three profit shares to be recognized in the third quarter of 2005 and none in the fourth quarter.)

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