U.S. Navy Gives $856 Million Contract for New Fleet Oiler Ship

General Dynamics NASSCO has secured an $856 million funding package from the U.S. Navy for the construction of another John Lewis-class fleet replenishment oiler, identified as T-AO 217. The project is part of the Navy’s ongoing effort to strengthen its support fleet amid growing global military and maritime tensions.

The new vessel is included in the eight-ship block-buy contract awarded in September 2024, covering ships T-AO 214 to T-AO 221. With this latest funding, NASSCO is now under contract to build 17 out of the Navy’s planned 20 oilers under the program. Five ships have already been delivered, while several others remain under construction in the company’s San Diego shipyard.

The John Lewis-class oilers play a major role in supporting U.S. Navy operations at sea. These ships are designed to transfer fuel, dry cargo, and supplies to warships while underway, allowing carrier strike groups and naval forces to continue operations without returning to port. The vessels are also capable of supporting aviation activities during missions.

The funding comes as concerns continue over the future stability of the U.S. shipbuilding workforce. NASSCO President Dave Carver said the T-AO program helps maintain steady employment at the shipyard and reduces the risk of layoffs. He also stressed the importance of securing funding for the remaining ships in the program to avoid disruptions in production.

The 742-foot vessels can carry around 162,000 barrels of oil and travel at speeds of up to 20 knots. The ships are considered important assets for long-range naval operations, especially as the U.S. Navy continues expanding its presence in strategic maritime regions, including the Pacific.