PORT ANGELES — Oil tankers will be stopping somewhere other than this deep-water port for topside repair.
Portland, Ore.-based Vigor Alaska is shutting down its Port Angeles Harbor operations by July 31 due to a worldwide slowdown in oil production, the company said Friday in a surprise announcement.
The move will leave about 15 employees without jobs in Port Angeles. The workers average $70,000-$90,000 a year in compensation, and the jobs generate an $840,000-$1.1 million annual payroll, company spokesman Benton Strong said.
He said employment fluctuates annually between 10-20 workers.
What Port of Port Angeles officials learned Friday about the company’s plans left them flat-footed.
Commissioners and staff said they had no inkling the company would depart when its annual $5,700-a-month lease with the port — $68,400 a year — expires at the tax district’s 10,000-square-foot facility on West Boathaven Drive.
Vigor’s employees were officially notified in person Friday morning that the company is closing its Port Angeles business, Strong said.
A separate company-wide email to Vigor’s 2,300 employees at facilities in Portland and Clackamas, Ore., and in Seattle and Vancouver said the Port Angeles plant will shut down by July 31.
Port Deputy Executive Director John Nutter received the same email Friday morning.
“It surprised everybody here,” he said.
Strong said the port was not warned that the company would be leaving or was considering the move.
“Our volume in Port Angeles is down 80 percent compared to past operations” he said in an email.
“The decline has been underway for approximately 10 years, with the reduction in volume accelerating in the last five years.”
Those market conditions are not expected to improve, he said.
The reduction in oil production has reduced the number of tankers to support topside repair in Port Angeles, “with these market conditions being specific to this location,” Strong said.
Vigor has provided topside repair for vessels in transit between Seattle and Alaska since 2014 from its current location.
The vacancy will increase empty rentable space at port facilities to 91,000 square feet, not counting the nearly 100,000-square-foot 1010 building temporarily occupied by the COVID-19 overnight social-distancing shelter.
Strong said Vigor has been leasing port facilities since 2002.
Vigor, the port’s fifth largest business tenant, blamed a sagging oil market that has affected tanker traffic and the topside repair activities of the Port Angeles facility.
While port officials have said tanker traffic has been steady during the pandemic, Strong said the shutdown was not specific to COVID.
The company overall has been doing well enough to offer opportunities to North Olympic Peninsula workers who will be losing their jobs, Benton said.
Between April and July, 2020, Vigor was awarded $253 million in contracts, including a $133 million pact with the Navy.
“That’s why there is opportunity in Portland and Seattle on sort of our core work on ship repair, and there’s a lot of work on our Navy clients,” Strong said in an interview.
Port and business leaders took Vigor’s announcement in stride.
Marc Abshire, Port Angeles Chamber of Commerce executive director, said the maritime industry is doing well in Port Angeles, including Platypus Marine Inc. and Brix Marine, formerly Armstrong Marine USA.
“I view this as a single business decision,” he said Friday.
“I wouldn’t view it as an economic indicator.”
Port commissioner Colleen McAleer said Friday that a reporter’s inquiry was the first she heard of the decision.
She said there were far fewer employees working at Vigor than the previous renter and predicted the facility will easily be re-leased.
“I don’t think that will be a problem,” McAleer said.
“That’s an excellent space.”
Board President Steven Burke said tanker topside repair is a niche sector of marine trades that may not have that much impact on Port Angeles if not part of the business mix.
Finding a new tenant for West Boathaven Drive will be an issue for the port’s new executive director, a selection the commissioners expect to make Tuesday after being unable to do so Friday.
“It’s an additional urgency that the new executive director will certainly need to take into account,” Burke said.
“Tenant leases is how the port is able to do economic development without using a lot of taxpayer funds.”
Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 55650, or at email@example.com.