12- to expand our shipping capabilities hand in hand with our sales program. This is being done and, as a matter of fact, orders have been placed for new ships and coupled with long-term sales contracts to Japanese mills that assure utilization of those ships. San Juan Carriers is purchasing two 67,500-ton combination oil and ore carriers, the first of which will be delivered in September 1962 and the second in December 1962. The company also holds an option on a third sister-ship. The purchase of these vessels is largely financed through loans from the Japanese, and the repayment is geared to the delivery of ore under the iron ore sales contracts. We have also taken some important steps that place our dredging operations on a sounder basis. As I previously indicated to you, our dredging operations have been conducted at a loss because we have been unable to keep these dredges profitably employed on domestic work enough of the time to earn a profit. Our dredges are particularly well suited to large projects involving the hydraulic dredging of difficult material. In smaller contracts or those involving easy digging, our dredges may be either unsuited or have no competitive advantage over older dredges that may be fully depreciated and in competitive hands. This year we have concluded agreements with private interests in Japan. Under the first agreement we have made available to the Japanese our plans for the Dredge ALAMEDA and to provide technical help to them in construction and operation of a new dredge of this type. Under another agreement we have leased the Dredge ALAMEDA for five years for use in dredging activities in Japanese waters. These arrangements make good sense for all concerned. Land reclamation and harbor development are of vital importance to Japan and its industrial growth, and dredges of the ALAMEDA type are the proper tool for the job. From Utah's standpoint, we