U.S. Shipping Partners L.P. (NYSE:USS)
Industry: Services
U.S. Shipping Partners L.P. (U.S. Shipping) is a provider of long-haul marine transportation services, principally for refined petroleum products, in the United States domestic coastwise trade. The Company is also involved in the coastwise transportation of petrochemical and commodity chemical products. U.S. Shipping's fleet consists of 10 tank vessels: six integrated tug barge units (ITBs); one product tanker, and three chemical parcel tankers. The Company's primary customers are oil and chemical companies. Integrated Tug Barge Unit Fleet U.S Shipping began operations in September 2002 when it acquired its six ITBs from a division of Amerada. The six ITBs primarily transport clean refined petroleum products, such as gasoline, diesel fuel, heating oil, jet fuel and lubricants, from refineries and storage facilities to a variety of destinations, including other refineries and distribution terminals. Three of the Company's ITBs are operating under time charters, two are operating in the spot market, and one is operating on a consecutive voyage charter. Regardless of its contract rates and rates in the spot market, U.S. Shipping is assured specified minimum charter rates for its ITBs through September 13, 2007, subject to certain limited exceptions, pursuant to a support agreement the Company entered into with Hess in connection with its acquisition of the six ITBs. The Company's ITB vessels are Jacksonville, Groton, New York, Baltimore, Philadelphia, and Mobile. All six ITBs are sister vessels of the same design and built to the same specifications. Product Tanker Fleet In September 2005, U.S. Shipping acquired the Houston, from the Wilmington Trust Company. The vessel is a Jones Act coastwise double-hulled product tanker, built in 1985. In December 2005, the Company signed a multi-year time charter for the vessel with Morgan Stanley Capital Group Inc. through 2011. The vessel will be trading in clean petroleum products in the coastwise Jones Act trade. Since it entered service on October 13, 2005, the vessel has operated in the spot market and will continue to do so until its multi-year time charter with Morgan Stanley, which will account for 100% of the usable capacity of the Houston, begins in 2006. Parcel Tanker Fleet U.S. Shipping acquired the first two of its parcel tankers, the Chemical Pioneer and the Charleston, in May 2003 and April 2004, respectively. These tankers primarily transport specialty refined petroleum, petrochemical and commodity chemical products, such as lubricants, paraxylene, caustic soda and glycols, from refineries and petrochemical manufacturing facilities to other manufacturing facilities or distribution terminals. The Company has contracts with Dow Chemical, ExxonMobil, Koch Industries, Lyondell Chemical and Shell with specified minimum volumes that will, in aggregate, account for approximately 74% of the anticipated usable capacity of the Charleston through July 2007, and 75% of the anticipated usable capacity of the Chemical Pioneer through February 2007. In November 2005, U.S Shipping acquired the Sea Venture, a double-bottomed chemical parcel tanker. The vessel was re-built in 1983 and is capable of carrying 21 different grades of product in independent cargo tanks. The vessel is expected to begin operating in May 2006, after an extensive drydock. At that time, it will be put in service covering the chemical contracts of the Company's first ATB under construction through the projected delivery of the ATB in December 2006. In 2007, U.S. Shipping expects that the vessel will continue trading in chemical and/or petroleum products for the Company. The Company's parcel tankers carry specialty refined petroleum, petrochemical and commodity chemical products primarily from refineries and chemical manufacturing plants and storage tank facilities along the coast of the United States Gulf of Mexico to industrial users in and around East Coast ports. The specialty refined petroleum products transported on its parcel tankers are generally not the types of refined petroleum produ
As Of: 10/07 00:00 ET
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