In A NATO First, France Agrees to Sell Warship to Russia

February 11, 2010 · Posted in Defence, Industry News · Comment 
 If completed, France’s sale of Mistral-class LHDs to Russia would be the first such agreement between a NATO member and Russia. (French MoD photo)

If completed, France’s sale of Mistral-class LHDs to Russia would be the first such agreement between a NATO member and Russia. (French MoD photo)

French defense officials say France has agreed to sell Russia a technologically advanced battleship and is considering a request to sell Moscow three more. If the sale is completed, it would be the first such arms sale between Russia and a member of NATO.

News of the sale has raised concern among other NATO members and some of Russia’s neighbors, especially Georgia, which fought a war with Russia in 2008.

French President Nicolas Sarkozy approved the sale of the Mistral-class assault ship after months of discussions.

Jacques de Lajugie, of the French arms agency DGA, said Russian naval officials have now submitted a request for three more ships, and that the request is “being examined.”

David Darchiashvili, the chairman of the Georgian parliament’s Committee for European Integration, said the planned sale is “a matter of concern for Russia’s immediate neighbors and I think it should be a matter of concern more broadly, in the context of regional stability, balance, and security. And this has to be the subject of discussions for NATO and EU member states.”

He added that he expects many countries in the region will object. “In Russia’s hands this weapon is not just an ordinary one, as it would be in the case of any peaceful country that was concerned about its own security and defense,” he said. “I expect that there will be a lot of objections to that [deal], and not just on our part.”

Lithuania wrote to France in November asking for clarification of the situation and details of the ship’s ammunition.

Offensive Capabilities

The Mistral is able to anchor in coastal waters and deploy troops on land, a capacity the aging Russian Navy lacks. The 200-meter-long ship can also carry 16 attack helicopters and dozens of armored vehicles.

Last year, Russia’s naval chief said a ship like the Mistral would have allowed the Russian Navy to mount a much more efficient action in the Black Sea during the Georgia-Russia war. He said the French ship would take just 40 minutes to do the job that Russian Black Sea Fleet vessels did in 26 hours.

French Defense Minister Herve Morin held a meeting in Paris with U.S. Defense Secretary Robert Gates today and said that France hopes to contribute to European stability.

Morin said he “[understood] that for some Central and Eastern European countries…the wounds are still there,” but added that France “[wants] to develop a relationship of trust with Russia.”

Gates would only say that he and Morin had discussed the sale and had “a good and thorough exchange of views.”

In Washington, Pentagon spokesman Geoff Morrell said U.S. “friends and allies in Eastern Europe are clearly nervous about it, especially Georgia…with good reason.” He added, “They fear these new warships would give Russia additional capabilities to once again threaten Georgia from the Black Sea.”

France rejoined NATO’s military command in 2009 after a 43-year absence. President Charles de Gaulle pulled France out of NATO’s military structure in 1966, saying it undermined France’s sovereignty.

If the sale of four ships is approved, at least two would be built in France, French defense officials told reporters Feb. 9. An initial contract, covering the first ship and worth $500 million to $600 million, could be signed on March 2, when Russian President Dmitri Medvedev is scheduled to make an official visit to France.

United States Dominance in Global Defence Sectors Could Erode

February 10, 2010 · Posted in Defence, Industry News · Comment 

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The United States’ dominance of the global defence sectors is likely to be eroded over the coming decade as both Russia and China encroach on formerly assured markets, according to the latest Jane’s Industry Quarterly study: “Crossing Borders: International Defence Industrial Relationships – a Global Perspective.”

Furthermore, the rise of emerging defence equipment exporters – from South Korea and Australia to Pakistan and India – will help shape the world markets during the years to 2020 and challenge the established producers from the West.

IHS Jane’s has identified Southeast Asia, the Gulf states and South America as the principal new frontiers where United States firms and those of China and Russia, in particular, are likely to find themselves competing head to head for arms orders over the coming ten years. The level of direct competition between East and West will be far greater than in previous decades.

Guy Anderson, editor and lead analyst of Jane’s Industry Quarterly explained:  “The defence trade relationships of the past two decades were very much shaped along Cold War lines.  Those certainties are evaporating. Just as the global security environment is becoming increasingly fluid, so too will patterns of international military sales.  “The aggressive military export strategies of Russia, and China to a lesser extent, are likely to pose significant challenges for Western military producers.”

Anderson added: “Russia increased its share of the world market over the last decade through a combination of keen pricing and flexibility, with a willingness to use sovereign debt forgiveness; counter trade; and technology transfer. Most importantly, there is a willingness to use arms sales as a bargaining chip to secure access to energy fields around the world.

“Western firms, on the other hand, will in many cases find themselves hampered by the presence of arms embargoes; technology and equipment export regulations; and the need to align the strategic objectives of national governments with the wishes of shareholders,” concluded Anderson.

Fishing Dispute Looms Between Canada and Denmark

February 9, 2010 · Posted in Commercial Fishing, Industry News · Comment 

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A fishing dispute is heating up between two unlikely countries – Canada and Denmark – over the ownership of Hans Island a tiny barren atoll off the coast of Greenland.

Northern shrimp is at the centre of the dispute.

The Canadian Federal Fisheries Minister Gail Shea last week accused Denmark of overfishing in international waters off the coast of Newfoundland, and has issued a warning that vessels from Greenland, which remain a Danish protectorate and the Faroe Islands that they will be barred from Canadian ports unless they agree to adhere to a 334-tonne shrimp quota established under the Northwest Atlantic Fisheries Organization (NAFO) conservation agreement.

A Canadian government spokesman said: “Denmark has “unilaterally” set a 3,100-tonne quota for its Greenlandic and Faroese fleets in the “3L” section of ocean just beyond Canada’s 350-kilometre economic zone, which “sets a dangerous precedent that could impact conservation of the species”.

Hans Island is the smallest of three islands between that part of Canada and Greenland in an area of sea known as the Kennedy Channel. Its sovereignty has been the subject of dispute between Canada and Denmark for some years.

Denmark’s share of the shrimp quota amounts to just one per cent of the total catch allocation, while Canada has 80 per cent of the quota. The Canadian Embassy in Ottawa has so far declined to comment on the warning which could mean that Greenland and Faroese vessels will have to find other countries to land their catches.

US Navy Revises Fleet Numbers

February 8, 2010 · Posted in Defence, Industry News · Comment 

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In its latest 30-year shipbuilding plan, the US Navy (USN) has distanced itself from its ambitious 2005 plan of fielding a 313-ship fleet by the middle of the coming decade.

Instead the service has told Congress that it wants a 301-ship fleet by 2040, a force level that will require a consistent funding level of USD15.9 billion on average per year.

The new plan envisages a fleet consistent with the irregular warfare and ballistic missile defence focus of the 2010 Quadrennial Defense Review (QDR).

Emphasizing “reasonable levels of funding”, the procurement of larger surface combatants has been curtailed in favour of smaller, cheaper ships such as the Littoral Combat Ship multirole frigate and the Joint High Speed Vessel, a shallow-draught intra-theatre connector.

The future large surface combatant programs – the Zumwalt-class (DDG 1000) destroyer and the nascent CG(X) cruiser replacement – have been replaced by the purchase of more Arleigh Burke-class (DDG 51) destroyers, which will eventually incorporate the navy’s Air and Missile Defense Radar development efforts.

By 2016 the navy expects the new DDG 51 hulls will be purpose-built for the ballistic missile defence role. Additionally, the navy plans to extend the service life of the Flight IIA Arleigh Burkes (pennant numbers DDG 79 and higher) to 40 years.

UK Seeks French Defence Entente

February 5, 2010 · Posted in Defence, Industry News · Comment 

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Britain is calling for enhanced military co-operation between the UK and France, saying greater defence collaboration with the European Union may be essential if the nation’s armed forces are to operate on a reduced budget.

A green paper published earlier this week sets out the terms on which Britain will conduct its forthcoming Strategic Defence Review, the Ministry of Defence will reassert that no military alliance is more important to the UK than the one with Washington.

But the document, drawn up by Bob Ainsworth, defence secretary, will put an unexpectedly strong emphasis on the need for the UK to work with the EU if it is to maintain its role on the world stage.

The 52-page document, called Adaptability and Partnership: Issues for the Strategic Defence Review, applauds the decision by Nicolas Sarkozy, French president, to take France fully back into NATO : “The return of France to Nato’s integrated military structures offers an opportunity for even greater co-operation with a key partner across a range of defence activity.”

The paper will underscore the importance of European security and defence policy to a degree not seen in a government policy paper for some years.

“The UK will greatly improve its influence if we and our European partners speak and act in concert,” it says. “A robust EU role in crisis management will strengthen NATO.  Playing a leading role at the heart of Europe will strengthen our relationship with the USA.”

The green paper even suggests that Britain may need to re-examine the weight it attaches to its relationships with NATO and the EU: “The review will need to determine where there is scope to increase the effectiveness of those relationships in delivering our security or to rebalance our investments across the organisations.”

The next government will take decisions after this year’s general election on how it will restructure the armed forces, given the pressure on the UK public finances. In particular, it must decide whether to proceed with the current decision to construct two aircraft carriers.

However, defence experts believe the forthcoming defence review must not only examine the balance between the three armed services, but whether the UK should reconfigure its alliances with the USA and EU.

Few defence officials expect an immediate warming of relations between Britain, France and the EU. David Cameron’s Conservatives have, in the past, expressed strong scepticism about the EU’s defence arrangements. But pressures on the UK defence budget may force the next government to look harder at whether it can avoid duplicating key defence assets with France and other EU states.

United States 2010 Quadrennial Defense Review Envisions a Do-It-All Military

February 4, 2010 · Posted in Defence, Industry News · Comment 

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The 2010 Quadrennial Defense Review (QDR) unveiled Feb. 1 envisions a U.S. military that would be very different than the one Defense Secretary Robert Gates found upon taking office in 2006. The much-anticipated review calls for a force shaped for a wide swath of activities in many hotspots, not one only shaped to simultaneously fight two peer militaries.

The 2010 review keeps a requirement for a force capable of conducting two major contingencies at once, but it “breaks from the past … in its insistence that the U.S. Armed Forces must be capable of conducting a wide range of operations.”

And it’s no short list, ranging from two big operations to “homeland defense and defense support to civil authorities, to deterrence and preparedness missions, to the conflicts we are in and the wars we may someday face,” the QDR states.

Gates, during a briefing at the Pentagon, told reporters he found the Cold War-era force planning construct “too confining,” and felt it “didn’t represent the real world” in which the U.S. military will operate for years to come.

The secretary prompted the change in the Pentagon’s force planned construct months ago. As the QDR process was getting underway, Gates told reporters he asked DoD researchers and planners what would happen if the U.S. military, which already is involved in a pair of major operations in Iraq and Afghanistan, faced another serious challenge.

Examples the secretary listed included a major earthquake like the one that destroyed much of Haiti last month and a major domestic disaster. The new construct “stresses the importance of fielding forces that are versatile and that, in aggregate, can undertake missions across the full range of plausible challenges,” according to the QDR.

“Because America’s adversaries have been adopting a wide range of strategies and capabilities that can be brought to bear against the United States and its forces, allies, and interests, it is no longer appropriate to speak of ‘major regional conflicts’ as the sole or even the primary template for sizing, shaping, and evaluating U.S. forces,” the review states.

Instead, the quadrennial study calls for a U.S. force “prepared to conduct a wide variety of missions under a range of different circumstances.” It goes on to describe operations that “may vary in duration and intensity for maritime, air, ground, space and cyber forces.”

Some former officials and analysts have raised concerns about the notion of creating a military largely composed of so-called “full-spectrum forces,” meaning they are able to do many things.

One source who reviewed a copy of the quadrennial study before it was publicly released said he worries it is pushing for a generalist U.S. force.

“That notion is a total misnomer,” the source said, adding he feels forces should have a clear and strong expertise.

The Pentagon seems to have heard such alarms.

“Ensuring flexibility of the whole force does not require each part of the force to do everything equally well,” the quadrennial review states. “Not all challenges pose the same degree of threat to national interests, rely on U.S. military capabilities equally, or have the same chance of occurrence.”

The new force-shaping model was derived from what the draft report calls the Pentagon’s four defense strategy priorities: “prevail in today’s wars; prevent and deter conflict; prepare to succeed in a wide range of contingencies; and preserve and enhance the force.” Sources say the priorities are known within the QDR process as “the Four Ps.”

The study also establishes frameworks that look beyond the five-year DoD budget plan that was rolled out along with the QDR.

“Whereas [past] QDRs have often emphasized shaping the force beyond the five-year time frame, this QDR, of necessity, had to focus intensively on present conflicts as well as potential future needs,” it states. “Our force-sizing construct therefore takes into account the realities of the current operational environment. In order to shape the force of the future, however, the construct also establishes sizing criteria for the midterm [5–7 years] and long term [7–20 years].”

The study also hints Obama administration defense officials agree with many Pentagon observers who have long said past QDRs failed to make a lasting impact because they often aren’t implemented within the Pentagon’s annual budgeting process.

“To ensure a tight coupling of strategic ends to means, the QDR force-sizing construct is defined according to the priority objectives of the defense strategy,” the study states.

Additionally, the draft QDR says Pentagon officials built the review around six key mission areas: defend the United States and support civil authorities at home; conduct counterinsurgency, stability and counterterrorist operations; build partnership capacity; deter and defeat aggression in anti-access environments; impede proliferation and counter weapons of mass destruction; operate effectively in cyberspace.

The QDR calls for steps to ensure success in each mission area that could influence Pentagon procurement and research accounts.

For defending the homeland, initiatives include enhancing crisis response forces, speeding development of nuclear and radiation detection tools, and bolstering counter-IED tools to thwart potential bomb attacks inside the United States.

Under the counterinsurgency-stability-counter terror goals, the QDR calls for increased availability of helicopters, unmanned and manned ISR planes, increasing “enabling assets for special operations forces.”

For “deterring and defeating” foes in “anti-access environments,” the QDR cites a list of steps: more long-range strike systems; “exploit advantages in subsurface operations”; enhance ISR platforms; and assure access to space.

The QDR raises cyberspace operations to the top of the department’s focus list. Here, the Pentagon must “develop a more comprehensive approach to DoD operations in cyberspace.” Also needed are “greater cyber expertise and awareness,” and better organization and command of cyber activities within DoD and across the federal government, it states.

Meantime, the QDR also spawned a follow-on study that will “determine what combination of joint persistent surveillance, electronic warfare, and precision-attack capabilities, including both penetrating platforms and stand-off weapons, will best support U.S. power projection operations over the next two to three decades.”

That study will inform budget plans for long-range strike programs for fiscal 2012 through fiscal 2017.

Reaction to the QDR from Capitol Hill has been largely predictable, with Democrats praising the strategic review and Republicans voicing questions and concerns.

The top Republican on the House Armed Services Committee, Rep. Howard “Buck” McKeon, R-Calif., said in a statement he is “concerned we are not making the necessary investments in research and development – as well as across-the-board investments in our weapons platforms – that will be required to meet the threats outlined in the Quadrennial Defense Review.”

Industry analysts say the review will create new opportunities for defense firms in realms like cyber security, giving a boost to helicopter- and unmanned aircraft makers.

Crude Oil Buoyed by Weak Dollar, Positive Manufacturing Data

February 3, 2010 · Posted in Industry News, Offshore Energy · Comment 

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In a bout of post-weekend short-covering, crude futures edged back into positive territory on the New York Mercantile Exchange this past Monday led by encouraging domestic manufacturing data and a weaker dollar. As the U.S. currency lost ground against the euro, its denominated price of light, sweet crude oil for March delivery gained more than $1.50 from last week’s lower price tag to settle at $74.43 a barrel.

Additionally, Wall Street was encouraged by Exxon Mobil Corp.’s earnings report, which beat out analysts’ expectations. The world’s largest publicly traded oil and gas company, ExxonMobil posted upstream earnings of $5,780 million, up $146 million from the fourth quarter of 2008.

“Oil prices were starting to lose momentum, and coming in this week, without the dollar continuing to rebound and with better-than-expected manufacturing numbers, the market took that as a sign that things may be turning around,” said analyst Gene McGillian at Tradition Energy in Stamford, Connecticut.  On Friday, the oil price exited the month of January down more than 8% from December 2008.

He continued, “I think that the market is showing strong resistance near $74-$75, and for the price to get boosted above that, we’ll need to see another round of unexpected economic data.”

Littoral Combat Ship RFP: Cost Will Be Chief Factor

February 2, 2010 · Posted in Defence, Industry News · Comment 

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General Dynamics LCS

The Request for Proposal (RFP) issued Jan. 26 by the U.S. Navy for the next round of bids for Littoral Combat Ships (LCS) details factors that will guide the choice later this year of a design basis for Flight 0+.

Navy officials have indicated that cost will be the foremost determining factor in their choice between a Lockheed Martin design and one from rival General Dynamics. But the RFP makes it clear a number of other criteria will be considered – chiefly technical and management factors.

Unclassified portions of the RFP were made public Jan. 28, posted on the Navy Electronic Commerce Online (NECO) Web site.

The RFP lists three primary bid items for the contract: a basic seaframe, or ship; selected ship systems equipment, consisting of weapons, sensors, computers and the ship’s combat system; and the systems to handle the integration and testing of the ship’s systems and equipment.

At stake is an award this year for 10 ships, including selected ship systems – two ships per year through 2014. A follow-on competition is scheduled for 2012, when a second shipyard will be chosen to build five ships over three years. A second source also will be chosen in 2012 to supply select ship systems.

Technical and management factors listed by the RFP are, in order of preference: affordability and production approach; management; technical data package adequacy, and rights in technical data and computer software; design change impact; past performance; and life-cycle cost reduction initiatives.

The guidelines also caution bidders to provide realistic price data.”Experience in Navy programs indicates that a contract awarded to a contractor submitting an unrealistic price proposal … may cause problems for the Navy as well as  the contractor during contract performance,” the RFP reads in part.

The LCS program became a poster child for cost growth in Navy shipbuilding after the $220 million ships contracted for by the Navy in 2004 more than tripled in cost.

The inability of either contractor to meet a congressional cost cap of $480 million for each of the new ships led the service in September to drop plans to buy both variants. Instead, the Navy took up a new plan to buy only one design, hoping to find economies in standardization and quantity orders.

The RFP lists technical management as “approximately equal in importance” to price and cost as the chief factors in determining a winner.

However, it cautioned, “the importance of overall evaluated price/cost as an evaluation factor will increase with the degree of equality in technical/management between competing proposals.”

Ice Is ‘Rotten’ in the Beaufort Sea

February 1, 2010 · Posted in Industry News, Ocean Science · Comment 

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Recent observations show that Beaufort Sea ice was not as it appeared in the summer of 2009. Sea ice cover serves as an indication of climate and has implications for marine and terrestrial ecosystems.

In early September 2009, satellite measurements implied that most of the ice in the Beaufort Sea either was thick ice that had been there for multiple years or was thick, first-year ice.

However, in situ observations made in September 2009 by Barber et al. show that much of the ice was in fact “rotten” ice — ice that is thinner, heavily decayed, and structurally weak due to a uniform temperature throughout.

The authors suggest that satellite measurements were confused because both types of ice exhibit similar temperature and salinity profiles near their surfaces and a similar amount of open water between flows. The authors note that while an increase in summer minimum ice extent in the past 2 years could give the impression that Arctic ice is recovering, these new results show that multiyear ice in fact is still declining.

The results have implications for climate science and marine vessel transport in the Arctic. The research appears in the journal Geophysical Research Letters.

Authors include David G. Barber, Ryan Galley, Matthew G. Asplin, Kerri-Ann Warner and Mukesh Gupta, Centre for Earth Observation Science, Faculty of Environment, Earth and Resources, University of Manitoba; Roger De Abreu, Canadian Ice Service, Environment Canada; Monika Pućko, Centre for Earth Observation Science, Faculty of Environment, Earth and Resources, University of Manitoba, and Freshwater Institute, Fisheries and Oceans; Simon Prinsenberg, Bedford Institute of Oceanography, Fisheries and Oceans; Stéphane Julien, Laurentian Region, Canadian Coast Guard.

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