It was recently announced that a joint venture involving Saudi Aramco has started construction work for a new shipyard on the east coast of Saudi Arabia.
The International Maritime Industries (IMI) has started work on the new shipyard after reaching a loan agreement with the Saudi Industries Development Fund (SIDF)-this according to UAE based Lamprell in a statement.
Saudi Industries Development Fund last year agreed in principle to offer $1 billion in funding the ambitious project.
The shareholders of the International Maritime Industries include Aramco, Lamprell, South Korea’s Hyundai Heavy Industries Co and Saudi Arabia’s National Shipping Co. (Bahri).
CEO of the estimated $5 billion project will be An Aramco executive.
Lamprell’s statement reported that its expected total equity contribution over the duration of the shipyard’s construction will be up to $140 million.
The facility that will be almost 12 million square meters upon completion is planned to have an annual capability to manufacture four offshore rigs and more than 40 vessels, together with 3 Very Large Crude Carriers (VLCCs), and also service more than 260 maritime products.
The deal will see the establishment of a major maritime yard at the Ras Al-Khair site in the eastern part of the Kingdom, said a Lamprell statement.
The statement added that in relation to the agreement of the shareholders; all conditions had now been finalized meaning that the IMI could officially start business.
Lamprell said that the construction process at the location has started in earnest with dredging and associated activities already in progress. It said that the partners have made major progress in creating the business infrastructure.
Work started at the site after the first capital contribution was made by each partner. Lamprell’s initial contribution amounted to $20 million, invested sometime last year.
ARO Drilling would order 20 jackup rigs form the IMI yard in the next 10 years, as indicated on one of the off-take agreements. Important fragments of a component for the first two rigs were expected to be subcontracted to Lamprell’s facilities of the UAE.
CEO of Lamprell, Christopher McDonald said that they have been working closely with their partners on the establishment of the IMI business over the past few months and are very satisfied to see such solid progress in the operational phase of the project.
McDonald is optimistic that the International Maritime Industries has the capability of becoming a leading global and regional service provider to the rig and vessel markets.