New Cruise Operator

A new entrant in the American cruise market will be the Norwegian line Fearnley & Eger, which has announced that it will convert a modern cargo vessel into a cruise ship, and has an option to convert an additional vessel.

Purchase and construction costs are estimated at $30 million. Capacity will be 250 passengers, and average daily rates are estimated to $300 per person.

The ship(s) will be leased to Exploration Holiday and Cruises of Seattle, which may also be part owners of the ship(s). Fearnley & Eger will be responsible for the marine operations, and the lease to Exploration Holiday and Cruises is for four years, with options that could run another six years or more. Fearnley & Eger is expecting lease revenues of more than $70 million for the period.

Built in 1973, the first ship is scheduled to be completed in May 1986, before beginning operations under the Panamanian flag. The decision whether or not to convert the second ship, will be made based upon results of the first year's operations on itineraries to Alaska in the summer and Mexico in the winter.

According to Fearnley & Eger, the line's entry into cruise shipping is based on the excellent long-term prospects for cruise tonnage.

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