The Times-Picayune: Huntington Ingalls to open Houston office to aid search for Avondale partner
Richard Thompson
Huntington Ingalls Industries said Tuesday that it will open a new office in Houston as it works to find a partner interested in developing oil and gas infrastructure to retain thousands of jobs at its Avondale shipyard, which is slated to close later this year.
On Tuesday, Chris Kastner, Huntington Ingalls' vice president and general manager of corporate development, said in a statement that Huntington Ingalls was involved in "active discussions with respected companies in the oil and gas infrastructure market."
Defense giant Northrop Grumman said in 2010 that it would shutter the yard and consolidate its shipbuilding operations in Mississippi. The shipbuilding unit of the company was then spun off in 2011 into Huntington Ingalls.
Details of the Navy shipbuilder's plans to tap into the energy sector as a growth industry are no surprise, as a Huntington Ingalls CEO Mike Petters told investors at the Credit Suisse Aerospace and Defense Conference in New York City in November that the company was still on track to shutter the yard in 2013 after finishing work on a transport ship for the Navy.
"We've satisfied ourselves that the engineering and construction elements of these projects are very comparable to shipbuilding, and we are working very hard, both internally and with prospective customers, evaluating and competing for new opportunities," Kastner said.
Petters said Tuesday that the energy industry was appealing because of Avondale's close proximity to the hub of the oil and gas industry. He expects future work would be plentiful, "in the heart of a region where there is more manufacturing demand than the current suppliers can meet, particularly in the energy markets," Petters said.
In late 2011, Louisiana officials and representatives of the shipbuilder expressed confidence that a state-sponsored $214 million incentive package would quickly draw out potential partners for a joint venture at the facility.
The deal, which would pay for workforce training and significant upgrades to the facility, was based on an assumption of 3,850 full-time workers at the site, once the largest manufacturer in Louisiana.
That number was down to about 2,200 workers, Huntington Ingalls said in December.
Members of the Louisiana Congressional delegation expressed satisfaction at the announcement Tuesday.
"Oil and gas infrastructure manufacturing at Avondale would be a welcome addition to our strong energy industry in Louisiana," U.S. Sen. Mary Landrieu, D-La., said in a statement.
U.S. Rep. Cedric Richmond, D-New Orleans, said Huntington Ingalls was taking "concrete steps to keep Avondale's workers on the job."
"It seems as though they've gotten a lot of excitement from the energy sector, so they have a good sense for the demand," Richmond said in an interview Tuesday. "I think if they're rolling it out and telling us that they fell good about it, then I feel good about it."
