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Conrad Industries, Inc. says that its net loss for the first nine months of 2016 is primarily due to a $12.5 million gross loss recorded on the construction of America's first dedicated LNG bunker barge.

For the quarter ended 30th September, Conrad posted a net loss of $4.7 million - and a loss per share of $0.92 - compared to a net income of $2.0 million and an earnings per share of $0.35 during the third quarter of 2015.

The company reported a net loss of $858,000 - and a loss per share of $0.17 for the first nine months of the year - compared to a net income of $7.2 million and an earnings per share of $1.24 during the corresponding period in 2015.

Johnny Conrad, President and CEO, remarked: "The net loss for the nine-month period was primarily the result of a $12.5 million gross loss recorded on the LNG bunker barge. Our repair and conversion segment achieved gross profit of $2.8 million for the nine months ended September 30, 2016 compared to a gross loss of $108,000 during same period of 2015, reflecting continued solid performance in a very competitive environment. Although we have incurred losses on the LNG barge, we believe we have developed resources to position our company as a leader in LNG marine-related construction in North America."

The CEO added: "Our results reflect a continued difficult operating environment. Our bid activity has been good and we see some opportunities, but we have also seen many new construction customers continue to delay projects and the environment remains very competitive. We are cautiously optimistic in the vessel construction segment due to our record backlog at September 30, 2016."

Vessel details

The LNG barge in question has been built at Conrad Orange Shipyard Inc, a division of Conrad Shipyard, LLC, for WesPac Midstream LLC and Clean Marine Energy LLC. It is to be used to service TOTE's newbuild Marlin-class container ships and other LNG-powered vessels in and around the port of Jacksonville and the south-east coast of the U.S.

The new 2,200-cubic-metre (cbm) barge includes an LNG Mark III Flex cargo containment system designed by Gaztransport & Technigaz (GTT).

Designed by Bristol Harbor Group and classed by the American Bureau of Shipping (ABS), the vessel is outfitted with Conrad's custom-fabricated 20-metre bunker mast under GTT license, which will enable the barge to service a wide variety of vessels.

The barge is also equipped with six DH Industries StirLNG-4 cryocoolers capable of handling the boil-off gas (B.O.G.) in addition to the other systems specifically designed for the vessel's LNG bunkering application to deliver the coldest LNG to the end user.

Study contract

In February, Bunker Index reported that offshore marine and engineering consultancy Aqualis Offshore, part of Oslo-listed Aqualis ASA, had been contracted by Gas Entec Co. Ltd to provide an engineering study of the Conrad-built LNG bunkering and transportation barge.

Aqualis Offshore's work scope is to provide a failure mode and effects analysis (FMEA) study for a control and alarm monitoring system (CAMS), emergency shutdown system (ESDS), and wireless telemetry system installed on the vessel.