GCC remains one of the best markets for workboats

Despite a global slowdown in the workboat market on the back of cancelled offshore projects, the workboats market in the GCC is expected to remain active, according to a senior industry executive.

While some construction projects in the region have either been cancelled or delayed due to the current economic crisis, the trend has not been felt in the offshore construction projects.

"We are very positive about the market in the GCC region and still feel investments in workboats are worthwhile," Sairi bin Ismail, Managing Director for Penguin Marine Boats Services (PMBS) and Director of Penguin Marine Offshore Services (PMOS), told Emirates Business.

"The slowdown in activity does little to dent the hopes we have in this region."

With the region accounting for a large portion of the world's offshore development projects, Ismail believes the GCC is still one of the best markets for workboats.

PMBS has assembled a number of workboats and passenger ferries for work on its new logistics management contract with local developer, Nakheel, for The World islands project.

Ismail said the company has for the past few months been moving the required vessels to the project sight at Port Rashid and that more large-size boats would be delivered in the coming weeks.

"Work is going ahead as scheduled and most of the required infrastructure has been put in place. We do not expect to be affected by the current downturn in the market," said Ismail.

The contract, with the potential to generate revenues of $200 million (Dh734m) over five years for the company, involves the management of a 87,000-square metre construction logistics port at Port Rashid, which has been purpose-built to handle transportation of personnel, materials and equipment in support of construction projects on a group of 300 man-made islands that form The World.

Although the initial investment in the contract by PMBS is not clear, the company had hoped to support the project through joint ventures, strategic partnerships, vessel charters and selective acquisitions. "We have been very positive about this region from day one and we plan to expand our footprint here," said Ismail.

PMBS is a 49-51 joint venture set up in 2007 and owned respectively by PMOS and local partner Demat Group, a Sharjah-based marine services and equipment provider, with interests in aluminium ship design, ship building and ship owning.

The company is investing in workboats in Abu Dhabi, Saudi Arabia and Kuwait.

Workboats include construction vessels, supply vessels, dredgers and anchor handling tugs.

The Middle East currently forms between 15 and 20 per cent of the global workboats market, with most of the vessels operating in the oil and gas sector. However, the region is believed to have the highest demand for workboats in the world for both infrastructure development and exploration activities.

The GCC was last year believed to be investing to a tune of $60 billion in a number of offshore oil and gas exploration projects in the next three to four years and a further $20bn in offshore infrastructure schemes.

Most shipbuilding yards in the region have been focusing on building and repairing workboats to satisfy the demand caused by huge investments in offshore projects.

The majority of shipbuilding firms in the UAE are mainly involved in the construction of supply vessels, tugs, accommodation work barges and landing crafts, which are on high demand.

"Shipyards prefer them because building such types of vessels does not require very huge budgets," said Mohammed Obaid Mubarak, General Manager, Dubai Shipbuilding and Engineering. "They are also assured of an available market due to the high demand for workboats in the region."

According to industry observers, more than 2,000 workboats, from tugs to dive boats to dredgers, are docked or repaired in the Middle East annually. There are currently 13 ship repair yards in the region sustaining five dry docks, eight floating docks and 17 slipways.

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