Navy awards $13.3M contract for specialized vessel charter, highlighting deep-sea rescue capabilities

Contract Overview

Contract Amount: $13,340,350 ($13.3M)

Contractor: Hornbeck Offshore Operators LLC

Awarding Agency: Department of Defense

Start Date: 2025-02-12

End Date: 2026-02-17

Contract Duration: 370 days

Daily Burn Rate: $36.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: N103 - PM42 - M. PRICE: 183-DAY SPCIALTIME CHARTER W/ ONE 182-DAY OPTION PERIOD SUMARINE RESCUE MISSION.

Place of Performance

Location: VIRGINIA BEACH, VIRGINIA BEACH CITY County, VIRGINIA, 23451

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $13.3 million to HORNBECK OFFSHORE OPERATORS LLC for work described as: N103 - PM42 - M. PRICE: 183-DAY SPCIALTIME CHARTER W/ ONE 182-DAY OPTION PERIOD SUMARINE RESCUE MISSION. Key points: 1. Contract value represents a significant investment in specialized maritime support. 2. Competition dynamics suggest a potentially efficient market for these niche services. 3. Risk indicators appear low given the definitive contract type and fixed pricing. 4. Performance context centers on critical deep-sea rescue missions. 5. Sector positioning is within specialized maritime logistics and support services.

Value Assessment

Rating: good

The contract value of $13.3 million for a 370-day charter with an option period appears reasonable for a specialized vessel like a submarine rescue ship. Benchmarking against similar high-demand, specialized maritime charters suggests this pricing is competitive. The firm fixed-price structure further supports value by transferring cost overrun risk to the contractor.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely considered. The presence of 3 bids suggests a healthy level of interest and competition for this specialized service, which typically benefits price discovery and ensures the government receives competitive offers.

Taxpayer Impact: A competitive bidding process for this essential service helps ensure taxpayer dollars are used efficiently, securing necessary capabilities at a fair market price.

Public Impact

The primary beneficiaries are the U.S. Navy and its personnel, ensuring readiness for submarine rescue operations. The service delivered is the charter of a specialized vessel equipped for deep-sea rescue missions. The geographic impact is likely focused on areas where U.S. Navy submarines operate, with potential global reach. Workforce implications include the employment of skilled mariners and support staff for the chartered vessel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if mission requirements expand beyond initial parameters.
Dependence on contractor's operational reliability and maintenance schedules.
Geopolitical factors could impact operational availability or deployment.

Positive Signals

Firm fixed-price contract mitigates cost overrun risks for the government.
Full and open competition suggests a robust market and competitive pricing.
Clear definition of service (submarine rescue charter) limits ambiguity.
Option period provides flexibility for extended operational needs.

Sector Analysis

The maritime logistics and support sector is critical for defense operations, particularly for specialized assets like submarine rescue vessels. This contract fits within the broader defense spending on naval readiness and operational support. Comparable spending benchmarks in this niche often involve high capital costs and specialized operational expertise, making such charters a common procurement method.

Small Business Impact

This contract does not appear to have a specific small business set-aside. However, the prime contractor, Hornbeck Offshore Operators LLC, may engage small businesses for subcontracting opportunities related to vessel maintenance, supplies, or specialized support services, contributing to the broader small business ecosystem.

Oversight & Accountability

Oversight will likely be managed by the Department of the Navy contracting officers and program managers. Accountability measures are embedded in the firm fixed-price contract terms and performance requirements. Transparency is facilitated through contract award databases, though specific operational details may remain sensitive.

Related Government Programs

Naval Vessel Charter Contracts
Submarine Support Services
Maritime Rescue Operations
Defense Logistics Support

Risk Flags

Potential for extended operational requirements beyond initial period.
Dependence on specialized contractor expertise and asset availability.
Geopolitical factors impacting deployment or operational zones.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.3 million to HORNBECK OFFSHORE OPERATORS LLC. N103 - PM42 - M. PRICE: 183-DAY SPCIALTIME CHARTER W/ ONE 182-DAY OPTION PERIOD SUMARINE RESCUE MISSION.

Who is the contractor on this award?

The obligated recipient is HORNBECK OFFSHORE OPERATORS LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $13.3 million.

What is the period of performance?

Start: 2025-02-12. End: 2026-02-17.

What is the track record of Hornbeck Offshore Operators LLC in fulfilling similar government contracts?

Hornbeck Offshore Operators LLC has a history of providing offshore services, including vessel charters, to various government agencies, particularly within the defense sector. While specific details on past submarine rescue charter performance require deeper investigation into contract databases, their established presence suggests experience in operating specialized vessels under demanding conditions. Reviewing past performance evaluations and any reported disputes or contract terminations would provide a more comprehensive understanding of their reliability and capability in meeting government requirements. Their portfolio often includes support for offshore energy and defense operations, indicating a capacity for complex logistical challenges.

How does the daily charter rate compare to market benchmarks for similar specialized vessels?

Determining an exact daily charter rate benchmark for a specialized submarine rescue vessel is challenging due to the niche nature of the asset and its specific capabilities. However, considering the complexity, crew requirements, and operational readiness demanded for such missions, the implied daily rate within this $13.3 million contract (approximately $36,000 per day over 370 days) appears competitive. Similar high-specification offshore support vessels or specialized maritime assets can command daily rates ranging from $20,000 to over $50,000 depending on equipment, certifications, and operational scope. The firm fixed-price nature of this contract further suggests that the government has secured a predictable cost for a critical capability.

What are the primary risks associated with this contract and how are they mitigated?

The primary risks associated with this contract include potential operational failures of the vessel, crew availability issues, and unforeseen environmental or geopolitical challenges impacting mission execution. Mitigation strategies are embedded within the contract structure. The firm fixed-price nature transfers significant cost overrun risk to the contractor. Performance standards and reporting requirements ensure operational accountability. The option period provides flexibility but also introduces a risk of extended commitment if not carefully managed. The contractor's own operational risk management, including maintenance schedules and crew training, is crucial for successful performance.

What is the historical spending pattern for submarine rescue vessel charters by the Department of the Navy?

Historical spending on submarine rescue vessel charters by the Department of the Navy can fluctuate based on operational tempo, fleet readiness, and the availability of government-owned assets. While specific figures for this exact type of charter are not readily available in public summaries, the Navy consistently invests in specialized maritime support capabilities. Spending in this category is often driven by strategic needs for maintaining submarine force safety and operational readiness. Analyzing past solicitations and awards for similar services, even if infrequent, would reveal trends in contract duration, value, and competitive landscape, indicating whether this $13.3 million award represents a typical investment or an outlier.

What are the key performance indicators (KPIs) for this contract?

Key Performance Indicators (KPIs) for this submarine rescue vessel charter contract would likely focus on vessel availability, operational readiness, response times to distress calls, crew competency, and adherence to safety and environmental regulations. Specific metrics might include the percentage of time the vessel is available for deployment, the time taken to mobilize the vessel upon notification, successful completion of simulated rescue exercises, and zero major safety incidents. The contract terms would detail these requirements, and performance would be monitored by the Navy's contracting officer's representative (COR) to ensure mission objectives are met effectively and efficiently.

Industry Classification

NAICS: Transportation and Warehousing › Deep Sea, Coastal, and Great Lakes Water Transportation › Deep Sea Passenger Transportation

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N3220525R4025

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 103 NORTHPARK BLVD, COVINGTON, LA, 70433

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $13,340,350

Exercised Options: $13,340,350

Current Obligation: $13,340,350

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline