Northrop Shipyard Could Run Out Of Work By 2013

BATON ROUGE, La. (AP) -- The Avondale shipyard outside New Orleans could close by early 2013 if Northrop Grumman follows through on plans to consolidate some shipbuilding operations in Pascagoula, Miss., company executives told state officials Monday.

Even if the consolidation doesn't happen, The Times-Picayune reports the shipyard's 11,500 direct and indirect jobs are in danger of disappearing by 2016 unless state officials can persuade the Navy to change its latest procurement plans.

"This would be a tremendous economic challenge, not only to the greater New Orleans area, but to the entire state of Louisiana," Gov. Bobby Jindal said Monday after a meeting with U.S. Sen. Mary Landrieu and Mike Petters, president of Northrop Grumman's shipbuilding operations.

The governor said he plans to join the state's congressional delegation in the coming days for a meeting with Secretary of the Navy Ray Mabus in an effort to keep Avondale open. Mabus is a former Democratic governor of Mississippi.

The immediate issue involves the Navy's LPD-17 San Antonio-class amphibious assault ships, which cost about $1.7 billion each and are built at Northrop's shipyards in Avondale and Pascagoula.

With two ships now under construction, the Avondale plant has enough work to keep it busy through 2012. But Northrop executives told the governor they are considering building the final two LPD vessels in Pascagoula. A decision on where the two ships will be built could be announced within days, Jindal said.

The long-term problems come after the LPD-17 program is completed. Under the Navy's latest shipbuilding plan, unveiled earlier this year, there are no more large contracts in the procurement pipeline that are suitable for Avondale, making it unlikely that Northrop Grumman will have any need for the facility.

An Avondale closure would be a major blow to a state economy that is reeling from the national recession and the more localized economic pain brought by the Gulf of Mexico oil spill and the federal moratorium on deepwater drilling it inspired.

Jindal also cited the announced cancellation of NASA's Constellation program, which would lead to the loss of jobs at the Michoud Assembly Facility in eastern New Orleans, as an example of federal policies he thinks are hurting the state.

"Federal policy decisions are destroying or preventing the creation of tens of thousands of jobs in Louisiana at a time when our country is facing the most severe recession we have faced in decades," Jindal said.

The governor said the state's short-term focus is on keeping Avondale open through 2015 by persuading Northrop to build the final two LPD-17 ships in Louisiana. That would buy the state more time to line up potential new tenants, a process the state already has begun.

"We're exploring every alternative," Jindal said.

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