July 5, 2007: A British warship builder, BAE, thought it has done well when it got a $1.2 billion contract to build three frigates for Brunei. The Sultan of Brunei, who is the richest man in the world (because of lots of oil, and few people, in his kingdom) wanted the ships to be the most modern and, in a special touch, insisted that all workspaces and fixtures be adjusted to accommodate Brunei sailors, who tend to be short (average height of 5 feet, six inches, about three inches shorter than what European warships are designed for). No problem.

But when the ships were completed and ready for delivery in 2004, Brunei rejected them, and refused to pay, insisting that they were not built to specification. BAE took Brunei to arbitration, as specified in their contract, and won. It turned out that the Sultan had not checked with his advisors as to see if tiny Brunei (population 375,000) could come up with the 300 sailors needed to man these three, 2,100 ton, warships. It turned out the answer was no. The ships are full of quite complex mechanical and electronic systems, and requires highly trained sailors to operate. Bruneis navy only has 900 personnel, and they currently operate about a dozen patrol boats and amphibious craft. The most sophisticated ships are three patrol boats, which carry some Exocet anti-ship missiles. None of Bruneis ships are much more complex than a fishing boat (radar, radio, simple engines).

It would take the Brunei navy years, perhaps as much as five years, to recruit and train the sailors needed to man the frigates. Foreigners could be hired to handle the most complex techie jobs, but the Sultan didn't go for this idea. Instead, he paid off UAE, with the understanding that BAE would find another buyer for the ships, to help defray the cost of the settlement (which, although secret, appears to give BAE all the money they were due.)

The crew height thing is popular with the media, but is not a big issue. That's because the only potential buyers for the three frigates are in south or southeast Asia, where your average sailor is about the same height as Brunei men. You see, the three frigates were built to operate in the tropics. There's no heating system on board. One could be added, but that would drive up the cost. Moreover, there are several countries in the region, and the Persian Gulf, that would like get these ships, which are based on the popular European F2000 light frigate design.