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Strategic Sealift (Roll-On Roll-Off Vessels)

The Strategic Defence Review identified a need for six Roll-On Roll-Off vessels (Ro-Ros) to give an improved strategic sealift capability to support the Joint Rapid Reaction Forces. Operational experience has demonstrated the difficulties in obtaining suitable ships to move military equipment in the short timescales demanded by the Joint Rapid Reaction Forces, and for the Armed Forces’ needs in operations worldwide. An improved strategic sealift capability was a commitment in the SDR. It will play a key role in fulfilling the Armed Forces’ equipment lift requirements in a wide range of operations, including those involving the deployment of the Joint Rapid Reaction Forces.

The full six-ship service will only be required for major operations and exercises. The MOD has therefore pursued a contract for a long term service under the Private Finance Initiative. Under the terms of the contract the service provider can make ships available for the generation of commercial revenue, at times when they are not needed by MOD – thus delivering better value for money for the taxpayer.

The ships providing the service will be equipped and classed as merchant ships. As the requirement is non warlike, the competition was conducted under EC Treaty and public procurement rules, within which the Government has ensured that the four competing bidders - NOVOMAR, The Maersk Company, A.W.S.R.Shipping Ltd, and Sealion - gave British shipyards every opportunity to bid for a share of the work The decision represents the best value for money for defence, having regard to price, quality and delivery.

AWSR Shipping Ltd will provide British officers and crews for the ships while in MOD use. The seafarers will be eligible for call out as Sponsored Reserves for operational requirements. The contract will be worth approximately £950M over 25 years, depending upon the amount of operational usage.

On 26 October 2000 Defence Secretary Geoff Hoon announced the selection of preferred bidders for the MOD’s landing ship and Strategic Sealift requirements. This package of work, worth £1.25 billion, will deliver early and significant improvements to UK Armed Forces’ ability to deploy rapidly and effectively world-wide. It is another significant step forward in implementing the Strategic Defence Review. These decisions secured over 2,000 jobs and create 1,000 new jobs in the UK’s shipbuilding industry.

A preferred bidder was selected for the strategic sealift service. A.W.S.R. Shipping Ltd was selected as the preferred bidder for the 25-year Private Finance Initiative contract to provide this service. The preferred bidder is a UK company and the contract will provide considerable UK employment opportunities, not just in shipbuilding but through supply of equipment, service operation and provision of crews. Over the life of the contract, it is likely that up to 85% of the total service price, - probably over £800M - will be spent in the UK. While the ships are in MOD use, they will be fully crewed by British merchant seamen. AWSR Shipping Ltd will be responsible for the provision of the crews, operation and maintenance of the ships – which are not warships - throughout the life of the contract. They will build two ships at the Harland and Wolff shipyard in Belfast, which are expected to secure 400-600 jobs in Northern Ireland, and four ships at the Flensburger yard in Germany. Constructing the vessels at two shipyards enables earlier availability than construction in one yard can provide, and the full service is expected to be available from early 2004. The contracts will be let while observing European regulations and without compromising on the quality of equipment the Armed Forces rightly expect.