"ARCO Marine's action underscores our commitment to compete successfully in the commercial shipbuilding market," remarked Albert L. Bossier, Jr., Chairman, President and Chief Executive Officer. "The initial award represented the largest commercial contract ever for Avondale. We are gratified that our progress to date on the first two ships has led to the exercise of the option for a third ship. The retrofitting and construction of crude carriers to comply with requirements of the Oil Pollution Act of 1990 remains an important focus of our marketing activities. Oil companies and other shipping interests are now taking serious steps to address the necessity of employing double-hulled ships to transport products between U.S. ports. We are intent on capitalizing on Avondale's expertise in this area. ARCO Marine's ships feature double hulls as well as sophisticated electronic systems for navigation and control. We believe that as newer, safer crude carriers are put in service, industry will continue this replacement cycle as quickly as possible."

"The Millennium Class represents ARCO's focus on safe operations through our continuous investment in equipment and crew training," said ARCO President Hersh Kohut. "We are very excited about the progress Avondale has made in building our first two tankers, which will set new standards for innovation and environmental protection."

Avondale Industries, Inc., headquartered in metro New Orleans, designs, builds and overhauls both military and commercial ships.