Horbeck-Leevac To Build Eight OSV's

Hornbeck-Leevac Marine Services, Inc. has approved a new vessel construction program for its wholly-owned subsidiary, Hornbeck Offshore Services, LLC. This is the company's third such program since its inception five years ago — the first two were seven and six vessel programs, respectively.

The current plan is to build eight additional state-of-the-art, deepwater OSVs, with construction of four 240-ft. (73.1- m) DP-2 Class vessels to commence as soon as a definitive agreement has been signed with the selected shipyard. The company has signed a letter of intent for the first four vessels with one of the shipyards currently constructing vessels for Hornbeck and, therefore, anticipates prompt contract execution.

All of the first four vessels are expected to be delivered by the end of 2003, with the first vessel due out in June 2003. Construction costs for the first four vessels will be funded by current cash and projected free cash flow from operations. The company also has available an undrawn revolving credit facility, which it does not expect to use to fund the first four vessels. Hornbeck is currently seeking price bids from shipyards for the last four vessels.

According to Carl Annessa, the company's vice president and COO, "The first four vessels in the newbuild program are an enhancement of our highly successful New Breed 240-ft. "E-class" design that we used in constructing the HOS Innovator and HOS Dominator, both of which are currently working for Sonsub. We have designed the vessel to increase its deadweight capacity and have also added additional service functionalities.

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