[Federal Register Volume 60, Number 201 (Wednesday, October 18, 1995)]
[Notices]
[Pages 53954-53955]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-25755]



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DEPARTMENT OF TRANSPORTATION
[Docket S-924]


Mormac Marine Transport, Inc.; Notice of Application for Written 
Permission to Section 805(a) of the Merchant Marine Act, 1936, As 
Amended

    Mormac Marine Transport, Inc. (Mormac) by letter of October 3, 
1995, corrected by letter of October 5, 1995, requests, pursuant to 
section 805(a) of the Merchant Marine Act, 1936, as amended (Act) and 
Article II-13 of Operating-Differential Subsidy Agreement (ODSA) 
Contracts MA/MSB-295(b) and MA/MSB-295(c), written permission (1) 
effective December 10, 1995, to own, operate, and charter its vessel 
MORMACSTAR, Official No. 569257, in the domestic intercoastal or 
coastwise service and (2) effective June 23, 1996, to own, operate, and 
charter its vessel MORMACSUN, Official No. 573770, in such service, 
both as herein stated.
    Mormac operates the MORMACSTAR, MORMACSUN, and MORMACSKY, sister 
ships, in subsidized essential bulk cargo carrying services in foreign 
commerce as provided in ODSAs Contracts MA/MSB-295(a), MA/MSB-295(b), 
and MA/MSB-295(c). These vessels were built at San Diego, California, 
with construction-differential subsidy (CDS) and delivered on December 
10, 1975, June 23, 1976, and February 2, 1977, respectively, and began 
subsidized operations under the ODSAs on those dates, respectively. The 
ODSAs will terminate 20 years after the commencement of the subsidized 
operations of the respective vessels, i.e., No. MA/MSB-295(a), December 
9, 1995; No. MA/MSB-295(b), June 22, 1996; and No. MA/MSB-295(c), 
February 1, 1997. On the same dates the respective vessels' obligation 
to operate in foreign commerce as provided pursuant to section 506 of 
the Act in the CDS contract under which they were built will expire.
    On December 10, 1995, the MORMACSTAR will cease to earn operating-
differential subsidy (ODS) (except insofar as it is eligible to share 
subsidy with the MORMACSKY under Contract MA/MSB-295(c) pursuant to the 
Maritime Subsidy Board's action of September 14, 1995, in Docket S-923, 
as discussed below). On June 23, 1996, the MORMACSUN will cease to earn 
subsidy (also with the exception of its 

[[Page 53955]]
eligibility to share subsidy with the MORMACSKY under the September 14, 
1995, action). On the same dates respectively, Mormac wishes to operate 
these vessels in coastwise and intercoastal trades. The continuation of 
subsidy under Contract Nos. MA/MSB-295(b) and MA/MSB-295(c) until June 
23, 1996, and February 2, 1997, respectively, however, will necessitate 
Mormac's receiving permission under section 805(a) for the MORMACSTAR 
and the MORMACSUN to undertake domestic operations, since section 
805(a) forbids the payment of subsidy to a contractor who owns, 
operates, or charters a vessel in domestic coastwise or intercoastal 
service without such permission.
    The three subsidized vessels are steam tankers of about 39,300 DWT, 
suitable primarily for the carriage of petroleum products.
    Mormac states that it hopes to seek employment on the spot market 
in domestic trade for the MORMACSTAR after December 9, 1995, and for 
the MORMACSUN after June 22, 1996, perhaps lifting petroleum products 
from the U.S. gulf or the west coast. Mormac notes that in these 
trades, protected by the Jones Act, most competitors' vessels are steam 
powered, and their average age is comparable to the MORMACSTAR's and 
MORMACSUN's so that they will be on a more level competitive footing. 
In this connection, Mormac points out that its vessels are well 
equipped and maintained, and in capacity, speed, and condition they 
will be well suited to the proposed trade.
    Mormac believes that the permission requested will not result in 
unfair competition to anyone operating exclusively in the coastwise or 
intercoastal service nor be contrary to the objects and policy of the 
Act. The permission sought, Mormac explains, will be requisite only so 
long as the MORMACSUN or MORMACSKY is receiving ODS; which will be only 
a little more than a year, from December 10, 1995, until February 1, 
1997, at the latest, in the case of the MORMACSTAR; and the MORMACSUN 
will not be engaging in the domestic trade until June 23, 1996, at the 
earliest, so that the permission to do so will be needed for only about 
seven months. According to Mormac, competition, if any, between the 
MORMACSTAR and MORMACSUN and other vessels now or hereafter serving the 
domestic petroleum products trade will be on a fair footing unaffected 
by ODS payments to Mormac. Mormac further believes the permission will 
further the accomplishment of objects and policies of the Act by 
helping keep in active service two well equipped, safe, and suitable 
vessels carrying domestic oceanborne commerce and capable of serving as 
a military and naval auxiliary.
    The application may be inspected in the Office of the Secretary, 
Maritime Administration. Any person, firm or corporation having any 
interest (within the meaning of section 805(a)) in Mormac's request and 
desiring to submit comments concerning the request must by 5:00 PM on 
October 30, 1995, file written comments in triplicate with the 
Secretary, Maritime Administration, together with a petition for leave 
to intervene. The petition shall state clearly and concisely the 
grounds of interest, and the alleged facts relied on for relief.
    If no petition for leave to intervene is received within the 
specified time or if it is determined that petitions filed do not 
demonstrate sufficient interest to warrant a hearing, the Maritime 
Administration will take such action as may be deemed appropriate.
    In the event petitions regarding the relevant section 805(a) issues 
are received from parties with standing to be heard, a hearing will be 
held, the purpose of which will be to receive evidence under section 
805(a) relative to whether the proposed operations (a) would result in 
unfair competition to any person, firm, or corporation operating 
exclusively in the coastwise or intercoastal service, or (b) would be 
prejudicial to the objects and policy of the Act relative to domestic 
trade operations.

(Catalog of Federal Domestic Assistance Program No. 20.805 
(Operating-Differential Subsidies)).

    By Order of the Maritime Administrator.

    Dated: October 12, 1995.
Joel C. Richard,
Secretary.
[FR Doc. 95-25755 Filed 10-17-95; 8:45 am]
BILLING CODE 4910-81-P