MIDDLE EAST • SAUDI ARABIA Rigs at Zamil Shipyards
Saudi Global Ports Zamil Offshore adapts
The is an edited version of an article by Eng. Hassan Aly Abouraya, business development manager at Zamil Offshore.
Sufyan Al Zamil (right), president of Zamil Offshore – the largest offshore and marine services provider in the Middle East – explains how the
region’s entire oil and gas industry has adopted a strategic approach of ‘cost transformation’ in order to remain competitive in global energy markets.
‘The current oil price outlook has forced regional companies to take a hard look at costs,’ he says. ‘Oil companies have started preparing for a future with continued market uncertainty, implementing – most structural changes across the industry which go beyond today’s traditional response of delaying projects and renegotiating with suppliers and implements.’
New measures of ‘strategic cost transformation’ include how companies can optimise their portfolios, reduce costs across the entire value chain by better collaboration with suppliers and other operators, reshape their operating models, and explore how best to exploit the numerous M&A opportunities in the market, he says.
As regards the offshore marine industry, reeling from a 70% fall in oil prices since mid-2014, there is a general feeling that this may represent a structural change rather than a traditional cycle, Al Zamil continues
The Middle East Offshore Support Vessel market remains ‘highly challenged’ at present, he says, with most OSV companies operating at
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around OPEX. The number of laid-up vessels decreased marginally during late 2016 but the global OSV fleet is still more than 600 units above pre- downturn levels with around 20% of vessels laid up.
However, the Zamil Offshore president believes a ‘new business model for future shipowning’ will emerge, embracing not just shipowners but the whole cluster, with a focus on collaboration in key areas such as Research & Innovation and talent development.
Zamil Offshore itself is confident of expansion opportunities in MENA region after having completing the first phase of a comprehensive
restructuring, spinning off its business units into three separate subsidiaries – Zamil Marine, Zamil Offshore Construction and Zamil Shipyards. Internal restructuring of each individual company will now follow, with an emphasis on improving quality and efficiency and reducing costs
Zamil Marine manages 75 OSVs, 67 of which are owned, with an average age of six years. Most are on long-term charter to Saudi Aramco.
Zamil Shipyards now manages and operates four shipyards, including two in Dammam for shipbuilding and ship repair, one in Ras-Tanura for repairing Aramco Offshore vessels and marine units, and one in Jeddah for merchant ship repair. To date it has built and delivered some 50 diverse offshore vessels, harbor tugs and coast guard surveillance vessels.
On the repair side it has recently inked partnerships with various ballast water treatment system (BWTS) suppliers and is also offering a technical advisory service to owners in the region who wish to lay up vessels.
Since it began operations in April 2015, Saudi Global Ports (SGP) has ‘faced the same challenges which the global shipping industry has been experiencing in the past few years’ regarding market conditions, ceo Anderson Goh tells Seatrade Maritime Review.
‘High-freight capacity versus low growth in trade and demand, megaships, re-alliancing, consolidation and mergers amongst the shipping lines.’
Nevertheless, the terminal handled 411,000teu in its first full year of operations in 2016, which Goh says represents more than 20% of the local market share.
Not content with standing still, SGP is making plans to expand as industry demands and
expectations continue to develop.
‘With the deployment of bigger vessels and re-organisation of shipping alliances, ports must be ready to handle the increasingly complex
requirements of our shipping line customers,’ Goh comments.
The port is equipped with a deep draft of 16mtr and the necessary equipment to handle
megaships. In 2017, eight new rubber tyre gantries have been added, while work on an additional 15ha area for operations has been completed.
‘We worked closely with the Customs Authority to improve the customs process, which is now operating 24-hour round the clock and allows for cargo clearance within three days,’ Goh adds.
Anderson Goh
Seatrade Maritime Review • Quarterly Issue 2 • June 2017 53
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