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Shipping Corp plans to buy seven vessels

Shipping Corp plans to buy seven vessels
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First Published: Sat, Jun 06 2009. 12 11 AM IST

Revamp in order: An ONGC oil drilling platform off Mumbai. SCI is buying support and supply ships to replace its ageing fleet of 10, which is on a five-year contract with ONGC. Bloomberg
Revamp in order: An ONGC oil drilling platform off Mumbai. SCI is buying support and supply ships to replace its ageing fleet of 10, which is on a five-year contract with ONGC. Bloomberg
Updated: Sat, Jun 06 2009. 12 11 AM IST
Bangalore: Mumbai-based Shipping Corp. of India Ltd (SCI) has placed orders for two ships with Cochin Shipyard Ltd and plans to buy five more, an official said.
India’s biggest ocean carrier by fleet size and revenues, 80.12% owned by the Union government, is buying these ships to replace its ageing fleet of 10 vessels used for towing, moving anchors and hauling supplies, which have to be withdrawn from service by 2013.
Revamp in order: An ONGC oil drilling platform off Mumbai. SCI is buying support and supply ships to replace its ageing fleet of 10, which is on a five-year contract with ONGC. Bloomberg
“We have board approval to buy seven offshore vessels,” said a SCI executive, who asked not to be named. The contract with Cochin Shipyard is for two of these vessels. “Orders for the remaining five will be placed in due course,” the official added.
U.C. Grover, SCI’s director for technical and offshore services, said the contract with Cochin Shipyard, India’s biggest under state-control by capacity and order book, involves an option for building two more similar vessels.
Grover did not disclose the value of the contract signed on Thursday for the two vessels, which are scheduled for completion by March and July 2011. At current prices, these vessels could cost $30-35 million (Rs140-165 crore) each to build, depending on specifications.
The fleet of 10 is working on a five-year contract with state-run oil explorer Oil and Natural Gas Corp. Ltd (ONGC).
These ships are used as support and supply vessels in offshore oil drilling operations. They are deployed to carry water, food, cement and chemicals to oil drilling rigs and help to position drilling rigs appropriately, thus providing key support to offshore oil exploration.
In January, SCI’s board approved the purchase of four such ships that are capable of pulling 80 tonnes, two that can pull 120 tonnes and another that has traction to pull 200 tonnes.
The two ships Cochin Shipyard would be building would be able to pull 120 tonnes. Pulling power is a measure to compare the strengths of tugboats.
In October 2007, SCI ordered four of these support ships, each with pulling power of 80 tonne and worth about Rs351 crore, at Bharati Shipyard Ltd, India’s second biggest private shipbuilder.
“The orders placed with Bharati Shipyard and Cochin Shipyard totalling six ships, along with five more to be acquired as per board approval, would help us maintain market share in the offshore sector even after the current fleet of 10 ships are scrapped by 2013,” SCI executive quoted first said.
p.manoj@livemint.com
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First Published: Sat, Jun 06 2009. 12 11 AM IST