Dutra Dredging Company
1000 Point San Pedro Road
San Rafael, CA 94901
415 721 2131

December 20, 1996                                  Serial Letter No. 0212

Department of the Army Corps of Engineers, San Francisco District Construction Service Branch Bay Model Building 2100 Bridgeway Avenue Sausalito, CA 94965

Attn: Mr. Leonard SooHoo, P.E., Administrative Contracting Officer

Ref: Contract No. DACW 07-95-C-0003

Subj: Environmental Concerns, Galbraith Disposal Area Turning Basin, Todd & Schnitzer Wings

Dear Mr. SooHoo;

At our schedule presentation meeting on December 13, 1996, we identified a time
period beginning immediately after the first of the year to start development
of a work plan for the completion of dredging

As a first step in the preparation of a plan for the completion of contract
work at Todd, Schnitzer and Galbraith, the following prerequisites are

 1.  Testing should be undertaken at Galbraith to assure that contaminants have
     not been introduced into the Galbraith Disposal Area.

 2.  Testing should be undertaken in the Todd & Schnitzer Wings of the Turning
     Basin and in IC-1C to determine whether or not storage of dredge spoils
     from those areas can safely be resumed at the Galbraith Disposal Area.
     Results of tests by the Port, Dutra and the Corps should be shared by all
     three parties.

Leonard SooHoo
December 20, 1996
Page 2

 3.  A group should be assembled which would include the Corps, the Port of
     Oakland, Dutra, environmental consultants and representatives of our
     insurance and bonding companies.  This group would sort through and
     evaluate actual and potential hazards and establish a detailed work plan.

The Contractor's bid did not contemplate the handling or disposal of toxic or
hazardous material and, because of the sensitivity of this subject with the
Port, the regulators and our surety and insurers, the procedure implemented by
the Corps for completing ths work must be by concensus with all concerned.

Given the importance and complexity of this subject, we solicit the Corps'
assistance in setting a time and place and in organizing for the commencement
of the work plan formation.


Mr. Robert D. Johnston President