Saudi Aramco Review

Abouraya ... seeing plenty of work

Abouraya ... seeing plenty of work

Zamil Offshore braces for tough competition in region

The company, together with the industry leaders in the region, agrees that the Middle East OSV market has bottomed out but claims that owners outside the region have flooded it with vessels that are keeping a lid on utilisation and rates


Despite the unstable global offshore support vessel (OSV) market scenario, optimism continues in the Middle East market driven by Aramco’s and Adnoc’s requirements, says Hassan Abouraya, consultant engineer, Zamil Offshore. The total OSVs working in the Arabian Gulf has slightly increased year-on-year.

Zamil offshore, together with the industry leaders in the region, agree that the Middle East OSV market has bottomed out but claim that owners outside the region have flooded it with vessels that are keeping a lid on utilisation and rates, he says.

"Anticipating market change is crucial, nobody could predict when the global oil prices will stabilise. There are significant opportunities for offshore vessel operators in Saudi Arabia, UAE and Egypt, but rates remain around breakeven levels," he says.

Saudi Aramco’s In-Kingdom Total Value Add programme will spur the localisation of the supply chain, creating small- and medium-sized enterprise activity. Overseas companies targeting Saudi business especially OSV owners coming from overseas to compete in Aramco chartering contracts should demonstrate an acceptable level of local content and involvement. They will be assessed, even audited, to check on the Saudi content of their operations. There will be plenty of work in Saudi waters, but not everyone will even qualify to make the shortlist, he notes.


GROWTH AND EXPANSION

Zamil offshore was founded in 1977 to work in Offshore Marine Services. In 2018 after 40 years of its growth and expansion in many diversified offshore activities, it was subjected to comprehensive restructuring. Now, Zamil offshore owns three subsidiaries: Zamil Marine, Zamil Shipyards and Zamil Offshore Construction.

Zamil Marine currently owns, manages and operates a fleet of 80 diversified offshore vessels and two lift boats. "Twenty-six vessels were built at Zamil Dammam shipyards. This includes seven Rolls-Royce UT 733 version-II anchor handlers with 80 tonnes bollard pull and 10 diesel-electric anchor handlers with 65 tonnes bollard pull," he says.

Zamil Marine’s fleet includes DP-2 dive support, maintenance, construction and supply vessels, utility and crew boats. Most of these vessels are in long-term charter contracts with Saudi Aramco, one vessel chartered in Sharjah, another is in Oman and a few chartered to a large EPC contractor in the GCC region.

During the last four years Zamil Marine faced fierce competition from a number of international offshore companies deploying their vessels in the GCC region including Tide Water, Swiper, Topaz, Seacore, Lamnalco and Swire Pacific. To keep all Zamil vessels employed, Zamil Marine was subjected to restructuring. A new experienced general manager was appointed who has almost 25 years of international OSV fleets management experience.

Zamil Marine is focusing on implementing several programmes for increasing efficiency and reducing vessel operational costs without compromising the quality of services. In addition to venturing into new areas of offshore services the company is keeping technical downtime below 0.5 per cent, cutting costs of crew changes, cutting costs of repairs by decreasing the number of docking days using the onboard crew to do most of the maintenance work onboard while afloat and during the stand-by and waiting times, minimising the shelf-time of spares, cutting fuel costs by implementing a consumption control system, and in-house ship chandelling.

Trimming the fleet operating and running costs in parallel with increasing the vessels operational efficiency moved the OSVs to a new competitive ground "operating the fleet around break even without losses under the globally bottomed chartering rates", he says. Zamil Marine is ready now for the global market competition.

At the end of 2017, Zamil Marine acquired its largest offshore unit, a brand new lift barge "Zamil LB2", a self-propelled jack-up lift barge with accommodation for 150 workers, and immediately succeeded in chartering it together with their Zamil LB1 to Saudi Aramco under LTA (Long term Agreement 5 + 2 years).

Zamil Offshore is a leading promoter of Saudisation and has already launched 100 per cent Saudi crew on board one of its OSVs.

Its recent additions include one large self-elevating self-propelled jack-up lift boat to accommodate 150 and two DP2 high bollard pull AHTSS.

Zamil Shipyards currently operates and manages four shipyards; two in Dammam for shipbuilding and ship repair, one in Ras-Tanura for Aramco offshore vessels repair and one in Jeddah for merchant ship repair.

Ever since Zamil shipyards ventured into shipbuilding, it is the premier and only shipbuilder in the kingdom. It has built and delivered 50 vessels (offshore vessels, harbour and navy tugs and surveillance/ logistics vessels).

Zamil Offshore recently appointed a new general manager with over 35 years of international expertise to manage it shipyards, and immediately started a comprehensive restructuring programme to re-organise the yard’s management and workforce, slimmed the organisation structure for better control and started implementing operational systems development to increase its shipyards’ competitive advantages. The new marketing efforts succeeded in loading the shipyards with several offshore jack-up rigs repair operations in parallel with offshore and small vessels maintenance and repair. Zamil’s Dammam shipyard rapidly acquired the trust of rigs owners in the Gulf including Rowan, Ensco and ARO and is getting regular repair works.

As per Zamil Shipyards’ new strategy to render one-stop repair and maintenance services, it started building its in-house service providers base and has already established a JV company with MTU Rolls Royce last year, which started paying this year specially with the great number of vessel construct for the Saudi Coast Guard at Lurssen shipyards in Germany.

As to new buildings, Zamil Shipyards with its track record in building a series of Rolls Royce UT-733 AHTS vessels, a series of Diesel Electric AHTS, and a series of DP-2 DSVs in addition to Logistics/ Surveillance vessels to the Kuwaiti Coast Guard and few navy tugs for the Saudi Royal navy, has won the Saudi government’s trust to participate in building locally a series of very fast aluminium interceptors (53 knots) in cooperation with the French CMN Cherbourg shipyard.

Zamil Offshore Construction is currently active in onshore, offshore and underwater construction services for the offshore oil and gas hook-up business including modification, upgrading and maintenance of all types of marine structures using the company’s self-propelled jack-up lift barges, workboats, crew boats, utility boats and DSVs. It has recently signed several teaming and cooperation agreements with Saipem, McDermott, Larsen & Toubro India, Emas AMC – Singapore to join their forces in executing Saudi Aramco’s offshore projects.




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