A strategic shipyard for Angola

What is the current state of your fleet?
We currently operate two ships, which are tankers. A bareboat charter agreement is in place for our FSIV vessel, which is a multipurpose vessel that we used to operate. This is in line with our strategic plan to focus more on our core business, which is fuel management.

How do you plan to expand the number of vessels you work with?
Through experience, we’ve learned that chartering fully operational vessels proved too costly, thus we are currently attempting to create a network with clients whom we are marketing fuel to, encouraging partnerships to form a consortium for possible future tenders, using their vessels.
The main strategy is thus to expand marketing here in Angola to ensure that clients are aware that we are a local company, owned 100% by Angolan partners. This will be very beneficial to them under the new local content framework.

Will the IMO 2020 sulphur regulation impact Angola’s potential as a regional bunkering hub?
We believe the sulphur content of the marine gas oil you can find in the Angolan market is sufficiently low. One type is the fuel oil, which already meets the 2020 standard requirements of a maximum of 0.5% sulphur content. While we already meet that standard, improving on the standard must remain the focus.
We will only become a service hub if we have sufficient fuel supply and the legislation allows us to export. We cannot be competitive just by selling internally. Looking at refineries around the world, you can no longer find marine fuel being produced with sulphur content above 0.5%. Angola can only compete internationally by having local refineries that operate and produce final products that meet international requirements.
Further, we could expand our international market if we had the necessary permits to export and import on our own, not just by relying on Sonangol. We need flexibility linked to associated national and international legislation.

What is the state of the Baía Farta shipyard project?
We have progressed significantly in the establishment of the first internationally recognised ship repair yard with associated dry dock capacity in Angola that will be servicing the marine repair needs of West Africa.
In 2018, a project information memorandum was created and officiated by Royal Haskoning for the creation of a three-phase international shipyard with a total capital requirement of USD 182 million.
In 2019, various national and international roadshows were embarked on initiating solicitation of funding for this significant Angolan infrastructure.
In 2020, the appointment for the creation of a full phase one of the Bainave project’s engineering, procurement and construction (EPC) was awarded to Royal Haskoning.
Our expectation is that phase one of these three phased projects will be operational toward the end of 2021.

What is the size and capacity of the shipyard and what kind of operations will it perform?
The shipyard will provide the entire range of services related to ship repair, such as steelwork, piping, propulsion, mechanical, valves, carpentry, electrical, electronics, coatings, tanks cleaning, NDT and safety as well as a vast range of reputable international manufacturers and service providers.
It is in a unique natural deepwater port in West Africa. With depths of 30 metres and adjacent berthing, it will therefore have unlimited potential to serve the maritime industry.
The sea footprint of the yard is 80,000 square metres and a land footprint of 35,000 square metres is owned by FAMAR.
Once fully completed, the shipyard will deliver to Angola and the entire region the much needed Panamax and Suezmax capacity, thus providing international-standard services and accreditation to a vast range of sectors, such as maritime commercial trade, the oil and gas industry and the fishing industry.
The yard will be certified to perform works as per class societies’ requirements, with ISO and OHSAS certifications.
The marine facilities will include a Panamax floating dock, Suezmax floating dock and a floating pier of 300 metres and will have 1,400 metres of adjacent berths.

What is the geographical advantage of the shipyard’s location at Baía Farta in the south of Benguela province?
Looking at just the oil companies, the business comes from the north to Angola. All the ships that are going to Namibia for repairs and maintenance have to cross the latitude here. Let me give you an example. Take a ship that is already in Gabon, Chad, [Republic of] Congo or Cameroon. Just in the sailing time back and forth, you’ll save a month in opex if you stop in Angola instead of Namibia. For a single ship that costs USD 10,000 per day, for instance, you’re already saving USD 300,000 because by stopping in Angola the ship will be ready for your clients to rehire again one month earlier.
There are no international shipyards in Nigeria. There aren’t any in Gabon or in Congo yet that have the same specifications as our shipyard. And we are closer, so the advantage is clear. On top of that, the shipyards in Namibia are fully booked for the next two years.
Strategically, we are not going to compete with other countries. We are trying to set up co-operation between our yard and their yards. We will need their support a lot.

What’s the projected demand for ship maintenance in Angola?
Angola itself is exporting about USD 200 million to its neighbour Namibia for ship repairs. If you look at the total number of ships in Angola that are following the international maritime standards, where the ships have to go into approved shipyards, there are about 300 such ships so the demand is still there.
When we owned four ships, I had to create a provision just for services – between USD 1.5 million and USD 2 million per year just for ship repairs alone. There was fighting back and forth with our banks to pay this tariff abroad. So why not create a shipyard here? We will go the extra mile and focus on this big opportunity.