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AUGUST 2019 NEO-PANAMAX FLOATING DOCK REVIEW, MARKET ANALYSIS AND STAKEHOLDER PERSPECTIVE. DR JACK DYER.

www.blueeconomyfuture.org.za; [email protected]

Disclaimer

The following document vision represents only interim conclusions from the perspective of this maritime economist and all intellectual copyright under the 1968 Copyright Act, remains with this author who exerts the moral right of authorship over this paper. Permission to cite/utilise may be offered only through the above email address and the author accepts no liability for any subsequent usage of these results.

Table of Contents

http://www.blueeconomyfuture.org.za/

NEO-PANAMAX FLOATING DOCK REVIEW, MARKET ANALYSIS AND STAKEHOLDER PERSPECTIVE.

ABBREVIATIONS AND ACRONYMS.........................................................................................................................6

SECTION I: INTRODUCTION AND BACKGROUND.................................................................................................6

1.1: Global Market, Trends and Motivation for Dock..................................................................................................7

1.2: Regional/Africa Market, Trends and Motivation for Dock....................................................................................8

1.4: Structure/Synopsis of Report and Overview......................................................................................................11

SECTION II: MARKET EFFICIENCY AND COMPETITOR ANALYSIS...................................................................12

1. INTRODUCTION..............................................................................................................................................12

2. PORT AND BACK OF PORT/ECONOMIC HINTERLAND: EFFICIENCY AND PERFORMANCE ANALYSIS12

2.1: Durban Port Pricing and Cost-Competitiveness...............................................................................................14

2.2: Durban Port Productivity and Efficiency Indicators............................................................................................18

2.3. Durban Port Efficiency Analysis.........................................................................................................................23

3: FLOATING DOCK EFFICIENCY ANALYSIS........................................................................................................27

3.1: Existing Challenges and Floating Dock Requirements for Stakeholders...........................................................27

3.2: Current SA Shipyards and Transnet Dock Facilities in Durban.........................................................................28

3.3: Private Sector Durban Competitors to South African Shipyard Dock Facilities.................................................30

3.4: Other Ship Repair Facilities/Floating Dock Characteristics To Consider...........................................................38

4.: SOUTH AFRICA DRYDOCK COMPETITOR PERFORMANCE AND EFFICIENCY ANALYSIS.......................46

4.1: Richard’s Bay Proposed Dock...........................................................................................................................47

5: AFRICAN COMPETITOR PERFORMANCE AND EFFICIENCY ANALYSIS......................................................49

5.1: East Africa Competitors.....................................................................................................................................51

5.2: Other African Potential Competitor Dock Facilities............................................................................................53

6: INTERNATIONAL COMPETITOR PERFORMANCE AND EFFICIENCY ANALYSIS.........................................54

7: Advantages Of Creating A Floating Dock Within A Port.......................................................................................80

8: Disadvantages/Externality Costs Associated With the Floating Dock..................................................................81

9: Risks/Challenges/Concerns/Constraints...............................................................................................................82

10.2: Global Opportunities and Recommendations..................................................................................................84

REFERENCES.........................................................................................................................................................85

SECTION III: DEMAND AND SUPPLY MARKET FORECASTINNG MODEL AND ANALYSIS..................................86

3.1: Introduction........................................................................................................................................................86

3.2: Stakeholder Perspective....................................................................................................................................86

3.2.1: Major Container Shipping Company A, Prospects of A Floating Dock and Ship Repair Perspective............87

3.2.2: Prospects of A Floating Dock and Ship Repair Perspective (Academia).......................................................87

3.2.3: Second Major Shipping Company Floating Dock and Ship Repair Perspective.............................................88

3.2.4: Recreation and Yacht Repair Perspective......................................................................................................89

3.2.5: Third Major Container Shipping Company Floating Dock and Ship Repair Perspective................................89

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3.3: Forecasting Potential Market Demand for the Neo Panamax Floating Dock....................................................90

Model Methods, Assumptions and Parameters........................................................................................................90

4: Conclusion and Recommendations......................................................................................................................92

References................................................................................................................................................................93

LIST OF TABLES AND FIGURES

Table 2.1: Aggregated Ship Repair Industry Stakeholder Requirements.....................................................................14

Figure 2.I: Vessel Dimensions and Class Types For Various South African Ports.......................................................15

Figure 2.2 South African Coal Port Due Costs (As Deviations From the Global Average)...........................................16

Figure 2.3. South African Container Port Costs (As Deviation From the Sample Global Average)..............................17

Figure 2.4: Container Vessel Costs Per Standardised Vessel......................................................................................18

Figure 2.5: Container Cargo Dues Per Standardised Vessel........................................................................................18

Figure 2.6: Terminal Handling Charges by Port, US$ per Standardised Vessel...........................................................19

Table 2.3: Additional Indicators of Durban and Competitor’s Port Performances.........................................................23

Table 2.4: Efficiency Analysis of Durban’s Port Performance.......................................................................................25

Table 2.5: Durban Port Efficiency and Productivity Indicators (This Study)..................................................................26

Table 2.6: Port of Durban 2018-2019 WEGO Indicators of Port Performance............................................................27

Figure 3.1: South African Shipyards: Existing Ship Yard Repair Facilities...................................................................30

Figure 3.2: Bayhead, Durban Private Ship Repair Dock Facilities................................................................................31

Figure 3.3: TNPA Durban Graving and Floating Dock Facilities...................................................................................31

Figure 3.4: Indian Ocean Trade Routes Overview........................................................................................................32

Figure 3.5: Indian Ocean Trade Routes in Detail..........................................................................................................33

Table 3.1: Competitive Rivalry Within the Durban Market............................................................................................35

Figure 3.6: Existing Ship Repair Facilities in South Africa............................................................................................35

Table 3.2: Transnet National Vessel Construction and Repair Facilities in South Africa..............................................36

Figure 3.7: Competitor Dormac’s Floating Dock Repair Facility, Durban......................................................................37

Figure 3.7: Competitor Elgin, Brown and Hamar Shipyard, Durban.............................................................................37

Table 3.2: Durban Drydock Costs Versus Cape Town and East London.....................................................................42

Table 3.3: Durban, Grand Bahama, Bahrain Dry Dock Tariff Comparison for the MV Patagonia................................42

Table 3.4: Durban, Grand Bahama, Bahrain Dry Dock Tariff Over 10 Days Comparison for the MV Patagonia.........43

Table 3.5: Comparison of Vessel Dimensions versus Costs For Durban Ship Repair.................................................43

Table 3.6: Local Ship Repair Supply Chain Component Opportunities........................................................................45

Table 3.7: Comparing Local Small and Medium Enterprise Shipyard Products Versus Global Market Averages.......46

Table 3.8: Average Vessel Characteristics and Related Scheduled Service Repairing Times.....................................47

Figure 3.6: Vessel Types Versus Average Vessel Size................................................................................................47

Figure 3.7: Vessel Types Versus Average Repairing Time..........................................................................................48

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Figure 4.1: Existing Richard’s Bay Repair Quay and Proposed Future Capesize Dock...............................................50

Table 4.1: Existing South African Port Facilities...........................................................................................................50

Table 5.1: Average Cargo Dwell Time in 2018 For 6 Leading African Ports.................................................................51

Table 5.2: Elgin, Brown and Hamar, Namibian Floating Dock Facilities.......................................................................52

Table 2: List of African Competitors..............................................................................................................................52

Figure 5.2.: SECO Ship Repair Facilities, Mombasa....................................................................................................54

Table 5.3: Comparing Durban to Mombasa’s Port Performance 2013 Average...........................................................55

Table 5.4: Tema Shipyard, Ghana Repair Facilities.....................................................................................................56

Figure 6.1: Geographical Distribution of the World’s Top Dock Competitor Facilities...................................................57

Table 6.1: Global Neo-Panamax Dry Dock Competitor Facility By Vessel Type.........................................................57

Table 6.2: The Caribbean and America’s Top 10 Potential Dry Dock Competitors......................................................58

Table 6.3: Global Floating and Dry Dock Top Competitors to South African Shipyards’ Proposed neo-Panamax Dock

......................................................................................................................................................................................59

Figure 6.2: Global Ship Repair Market Services Market Share by Vessel Type 2017..................................................80

Figure 6.5: Global Port Rankings..................................................................................................................................81

Table 6.4: List of Major Global Competitors For the Indian Ocean Rim Trade Route...................................................82

Table 19: Employment Opportunities in the Floating Dock/Ship Repair Sector............................................................84

Table 20: Potential Environmental Disadvantages/Externality Costs of a Floating Dock and Ship Repair Facilities. . .85

Table 21: Constraints/Challenges Potentially Affecting a Floating neo-Panamax Dock...............................................87

Figure 1: Calculating the Optimal SAS Floating Dock Market Demand Process..........................................................93

Table 1: Indian Ocean Rim Competitors to Durban Port and SA Shipyards’ Floating Dock.........................................96

Table 2: Historic Vessel Arrival Numbers and Extent of Possible South African Market Demand 2007-2018 for Ship

Repair Facilities in Durban............................................................................................................................................97

Table 3: South Africa Total Historic Vessel Arrivals Market Demand 2008-2018.........................................................98

Figure 2: Historic Vessel Arrival Numbers, Types and Extent of Possible Market Demand 2015-2018 for Ship Repair

Facilities in Durban........................................................................................................................................................98

Figure 3: South Africa Total Historic Vessel Arrivals Market Demand 2008-2018........................................................99

Table 4: Lloyd’s List Sample Market September 2017-2018 of Durban Vessel Types...............................................100

Figure 4: Lloyd’s List Sample Market September 2017-2018 of Durban Vessel Types..............................................101

Table 5/Figure 4: Durban Port Vessel Callers: Distribution of Ages for the Lloyd’s List 2017-2018 Sample..............102

Figure 5: Lloyd’s Sample of Durban Port Caller’s Vessel Registration Source...........................................................103

Table 6January-June 2019: Durban Port Vessel Arrival Numbers.............................................................................104

Table 7: January-June 2019, Durban Ship Repair Berth Occupancy Numbers and Potential Demand.....................104

Table 8: Future Vessel Arrival Numbers and Extent of Possible South African Market Demand 2017-2051 for Ship

Repair Facilities in Durban (1% Annual Decline)........................................................................................................105

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Table 9: Average South African Market Demand 2017-2051 (5% of Total Demand) for Ship Repair Facilities in

Durban (1% Annual Decline).......................................................................................................................................106

Table 10: No of Potential Vessel Demand for Various Sized Ship Repair Facilities in Durban (1% Annual Decline).107


Repair Facilities in Durban (3% Annual Growth).........................................................................................................109

Figure 6: Future Vessel Arrival Numbers and Extent of Possible South African Market Demand 2017-2051 For Ship

Repair Facilities in Durban (Scenario 2: 3% Annual Growth).....................................................................................110


Durban (Scenario 2)....................................................................................................................................................110

Table 13: No of Potential Vessel Demand for Various Sized Ship Repair Facilities in Durban..................................111

Scenario 2...................................................................................................................................................................111


Repair Facilities in Durban (5% Annual Growth). Scenario 3.....................................................................................113

Figure 7: Future Vessel Arrival Numbers and Extent of Possible South African Market Demand 2017-2051 for Ship

Repair Facilities in Durban (5% Annual Growth).........................................................................................................114


Durban. Scenario 3.....................................................................................................................................................114

Table 16: No of Potential Vessels’ Demand for Various Sized Ship Repair Facilities in Durban. Scenario 3............115

Table 17: Sub-Optimal SAS Floating Dock Market Demand Potential for Scheduled Ship Maintenance in Other South

African Ports 2019-2023 (Lloyds Sample)...................................................................................................................117

Figure 8: Sub-Optimal SAS Floating Dock Market Demand Potential for Scheduled Ship Maintenance in Other South

African Ports 2019-2023 (Lloyds Sample)...................................................................................................................118

Table 18: Optimal Market Supply Analysis for Three Proposed Panamax Docks......................................................119

Figure 10: Optimal Market Supply Analysis for Three Proposed Panamax Docks.....................................................119

Table 18: Number of Global Floating and Drydock Competitors by Dock Length Limits............................................120

Figure 11: Number of Global Floating and Drydock Competitors by Dock Length Limits...........................................120

ABBREVIATIONS AND ACRONYMS

AMGECO African Marine and General Engineering Company

DCT Durban Container Terminal

DWT Deadweight Tons

GRT Gross Registered Tons

MV Merchant Vessel

SAMSA South African Maritime Safety Agency

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SECO Southern Engineering Company

SOLAS Saving Our Lives At Sea

TEU Total Equivalent Units

TNPA Transnet National Port Authority

USA United States of America

SECTION I: INTRODUCTION AND BACKGROUND.

Global economies, supply chains, stakeholders and communities are increasingly dependent upon the ocean sector as catalysts of growth, development, survival and opportunity. From 2010-2030, estimates project increased growth from US $1.5 trillion in economic activity and 31,000,000 direct jobs to over $3 trillion and 45,000,000 jobs. Ocean assets are valued at over $24 trillion. More government and maritime stakeholders are increasingly prioritising the transition from an extractive ocean economy model; to the emerging “blue economy.” United Nation Sustainable Development Goal 14 specifically concentrates on harnessing oceans. This aims for a more sustainable, long term future through exploiting myriad opportunities. For example, the United Nations Environmental Programme define the blue economy as a “vision of improved well-being and social equity, while significantly reducing environmental risks and ecological scarcity.” The World Bank note it as: “the sustainable use of ocean resources for economic growth, improved livelihoods and jobs, whilst preserving the health of marine and coastal ecosystems.” Blue economy activities and markets incorporate fisheries and aquaculture; shipping, transport and ports, marine education, training and research; marine, coastal and cruise tourism with recreation, marine construction, offshore oil and gas, marine

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insurance, finance and business, marine and cargo services. Other emerging sectors include navies, marine protection, security and ocean governance (including drones), renewable energy, biotechnology and seabed mining. However; this report’s scope specifically excludes these blue economy areas to concentrate on the global, regional and local opportunities of the ship building, repair, demolition and conversion markets. In particular, it concentrates on investigating the economic, market and technical feasibility of a Panamax floating dock and the associated industry’s maritime potential,

1.1: Global Market, Trends and Motivation for Dock

Global macroeconomic prospects and market trends indicate generally favourable if slightly uncertain justification towards establishing a Panamax floating dock or equivalent ship repair facilities in South Africa. Global seaborne trade increased to 4% in 2017 from a 3.5% average during 2012-2017 (UNCTAD 2018). Total volumes reached 10.7 billion tons, reflecting an additional 411 million tons, nearly half of which were made of dry bulk commodities. Container vessel profits exceeded $7 billion. For shipyards, the world fleet expanded by 3.3% with 45,000,000 gross tons added. 64,989 vessels were constructed, contrasting with only 22,916 scrapped. Over 90 % of shipbuilding activity occurred in China, Japan and Republic of Korea. 79% of ship demolitions took place in South Asia, notably in Bangladesh, India and Pakistan. Larger vessels or those over 500 gross tonnes (GT) created over US $475 billion of economic production value with direct average annual production value of US$ 82 billion. The related marine supplies industry adds US$ 50.4 billion Second-tier suppliers add an additional total production value of US$ 100-120 billion. (Balance Consortia 2018). Other potential developments include an ageing global fleet and increased pressures for fleet modernisation and conversion to Liquified Natural Gas given global volatility in fuel prices; Middle East source regional instability and increased greenhouse gas mitigation pressures in response to global climate change. Other trends include the ratifying of the Ballast Water Convention and 2020 Sulphur Cap. Global shipping companies face increased reputational risks for environmental sustainability and corporate social responsibility; generating opportunities for shipyards to convert existing fleets. As vessels become increasingly autonomous with fewer seafarers; additional potential exists to reconfigure vessels to maximise cargo utilisation.

Yet, as this report motivates through a market competitor, efficiency and market feasibility analysis; the global shipbuilding, repair, conversion and demolition market remains highly competitive with at least 5,076 registered shipyard competitors. Vessel orders have remained essentially static across dry bulk, container, wet bulk and general cargo vessels. An increased demand for short sea shipping with reduced route distances, favours closer yards over remoter docks. Increasing vessel sizes; historically low freight rates and fluctuating commodity prices, favour increasing technical economies of scale, stagnating demand for existing drydock and floating dock competitors. Despite increasing maintenance and repair markets, falling orders increases pressure on existing fleet operators, vessels and shipyards. With the expansion of the Panama and Suez canals alongside rapidly evolving technology and economies of scale, new vessels are increasing in magnitude, causing obsolescence of smaller facilities. Climate change creates further physical risks, whilst many governments and ports regionally in Africa and internationally have yet to invest sufficiently in their operated facilities. From 2017-2018 the ship repair market expanded by 6.4% to $20,532,600,000, dominated by 15 companies. The global

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market is projected to reach $39, 934,800,000 by 2028. It is dominated by Singapore, Dubai, Bahrain, China and India. Therefore, there is increasing economic pressure for shipyards remain competitive and relevant through investment in a Panamax size vessel, floating dock. No equivalent significant floating dock exists across Africa and few in the Southern Hemisphere, as the competitive analysis in Chapter 2 illustrates. This will enable shipyards to service multiple consumers across a broad market spectrum including including major shipping companies; naval; offshore supply, oil and gas, fishing and cruise vessels; recreational yachts and superyachts.

1.2: Regional/Africa Market, Trends and Motivation for Dock

Across the African region various market trends provide increasing motivation to investigate the market feasibility of creating a Panamax class dock. In terms of physical port expansions increasing capacity between 2013-2033 no other sector economically could even begin to compete with the opportunities presented by myriad African, physical port expansions and modernisation programmes from Durban in South Africa to Mombasa, Bagamoyo, Maputo, Port Victoria and Dar es Salaam in East Africa to Tema and Takoradi ports in West Africa may provide. Table I illustrates projected container cargo throughput growth in SADCC port demand and supply volumes between 2013-2033 (Dyer 2015). For example, Durban and Mombasa’s projected port expansion are among 2 of Africa’s largest current infrastructure projects. These illustrate the potential to transform the local, regional and national economies from a maritime perspective through associated expenditure, improved infrastructure, services; training and related employment, productivity; revenue, trade, investment and other potential benefits (although there are always significant social, environmental, opportunity and other associated development costs). This potentially translates into increased vessel traffic and subsequent demand for drydocks and floating docks. Increased naval traffic is further projected from the April 2013 IMO Anti-Piracy Code and a dedicated though under-supported Counter Piracy Strike Force.

Table I: Rival SADC Port Competitors Projected 2013-2033 Demand and Supply

Source: Dyer 2015.

But Africans face several core maritime challenges aside from inefficient ports and scarce skills that it is essential to resolve. The continent has no maritime stock exchange or insurance sector; archaic maritime infrastructure, technology and services for most ports –paralysing developments. Many local terminals and ports are leased to foreigners. There are few maritime

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lawyers, few shipyards and floating or drydocks capable of world class competitiveness. There exist far too few academics and professionals equipped; no specialised maritime banks –not even local shipping companies and vessels. However, as Africa’s governments and maritime stakeholders turn towards implementing the 2050 envisioned, African Union Integrated Maritime Strategy. Goal I is unlocking the ocean economy. Goal II is engaging with the ocean. Goal III is ‘ensuring healthy, living marine ecosystems.’ Goal IV is contributing to good ocean governance.’ Further implications for SA Shipyards and its competitors include increasing regional government pressure to construct African shipping fleets and pursue cabotage policies to ensure ocean governance, commerce, defence, security and sovereignty over Combined Exclusive Zones of Africa.

AIMS 2050 calls for a ‘tool to address Africa’s maritime challenges for sustainable development and competitiveness, further aiming to foster more wealth creation from Africa’s oceans, seas and waterways by developing a thriving maritime economy and realising the full potential of sea-based activities in an environmentally sustainable manner. The strategy aims to foster overall development and improve independence for African countries. Ruppel and Bian (2016) identify that to take back the seas from international fleets; African governments are prioritising cabotage as a strategy regardless of the constraints, challenges and risks. The African Union (AU), through its 2009 African Maritime Transport Charter objectives include ‘promoting the establishment of national and regional shipping lines and provide them the assistance necessary for their success (Article 8) including legal policies, cooperation, financial incentives and a dedicated specific fund (Article 13). The 2012 African Union, Africa’s Integrated Maritime Strategy, specifically challenges governments to support African merchant fleets and become world leading maritime powers by 2050. Article 3: 1 states Africa to “Declare, articulate and implement harmonised maritime transport policies capable of promoting sustained growth and development of African Merchant fleets.” The SADC Protocol on Transportation, Communication and Meteorology (Article 8.2) seeks a consistent, coordinated maritime and inland waterway cabotage policy including the promotion of ship owning, ship registration, ship operations and slot chartering, the growth and development of a viable SADC Merchant Shipping Industry, including the role of concessions and incentives to improve competitiveness, tonnage capacity in member states, including enhanced use of coastal shipping and feeder services and endorsing joint ventures and alliances between ship owners to promote economies of scale, similar to the international liner pooling arrangements.

Alternative potential exists in the cruise industry. Africa currently has only one cruise terminal and regular cruise company (MSC). Developments are being considered in Cape Town, Cape Verde and Mombasa. The Indian Ocean Cruise Association, the Organisation For Economic Cooperation and Development (OECD), (2016) in ‘The Ocean Economy in 2030’, and United Nations Economic Commission for Africa, 2016 have recently indicated it as a future growth chance for the continent’s blue economy. The African Development Bank, New York University Africa House and the Africa Travel Association, (2015), considered unlocking Africa’s tourism potential which in 2014 represented only 5.6% (65.3 million) of the global total of 1.33 billion, over $45.6 billion in revenue, supporting an estimated 8,7,00,000 Africans in direct employment which cruise tourism can contribute to if sustainably and responsibly managed. Other African trends include developing regional trade across the BRIC’s region (Brazil, Russia, India and China), encouraging more vessel callers. Liberia’s registered shipping fleet is expanding rapidly

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((3,521 vessels and 3.53% of world total). Nigeria is pursuing its own rapid cabotage policies in developing its fleets. Mozambique discovered 200 trillion cubic feet of offshore gas, increasing offshore gas vessels whilst many nations including Gabon and Angola lack their own dock facilities to service the oil industry. There is growing interest by Namibia/Namport in Walvis Bay over repairing oil/gas rigs/fishing vessels. However, Africa lacks suitable floating or dry dock facilities capable of addressing global, regional and local demand market trends, as Chapter 2’s competitor and efficiency analysis will further analyse. A decision to investigate the market feasibility of a Panamax floating dock represents one of the few answers currently being pursued across Africa.

South Africa mirrors other global and African nation opportunities to capitalise on emerging blue economy opportunities including shipyards, shipbuilding, demolition, conversion and cabotage. Locally, South Africa is currently reviewing its historic position of avoiding cabotage through potential Cabotage Laws, which more clearly articulate Operation Phakisa. Since 2014, it has pursued this under Operation Phakisa, targeting 1000,000 maritime related jobs by 2033. Opportunities and investments citied under African Integrated Maritime Strategy and Operation Phakisa including ship repair, maritime education; aquaculture, marine tourism, oil and offshore gas. Operation Phakisa claims to maintain and refurbish existing ship repair facilities at all ports. It seeks R2 billion cofounding, targeting 20,000 jobs by 2023 and R6.5 billion projected GDP contribution. Further commitment to the maritime and ship repair sector is echoed through the Comprehensive Maritime Transport Policy 2017; National Transport Master Plan 2050, National Industry Policy Framework, National Transport Policy, KZN Integrated Maritime Strategy, forthcoming eThekwini Blue Ocean Economic Framework and 2030 National Development Plan and New Growth Path.

The national port authority Transnet is undertaking port expansions for 7 ports including more dredgers, tugs and pilots requiring servicing and construction. Durban’s future as the most significant of African ports, is challenged further by the ascendency of Post-Panamax size vessels (over 350 metres long, with up to 12,000 containers and a 170,000 deadweight ton carrying capacity), with the potential for ever greater economies of scale, efficiency and productivity but also increased externality costs for users and seaports able to permit their entry. Its existing port capacity denies their potential macroeconomic benefits, especially from significant forecasted international trade growth and possible container demand exceeding 12 million TEUs by 2044 (Transnet January 2014). Geophysically, Durban’s present harbour cannot expand, currently encircled by the city and the Indian Ocean. Transnet has committed to investing a total of R250 billion up to 2050, to convert the former Durban International Airport and even potentially the Bayhead Basin, railway marshalling yard sites into further dugout port extensions to reach an annual 20 million TEUs of cargo handling capacity. Until 2019, R33 billion will be invested in enhancing existing port container throughput capacity to its maximum potential of handling 4.8 million TEUs at most, as another constraint requiring a physical port expansion. While these may potentially resolve current problems of port-related capacity constraints; the DIA site alone is projected to cost R100 billion over the next twenty five years to develop. Due to budgetary; environmental, zoning and local community tensions; this development has been paused.

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The South African Maritime Safety Authority (SAMSA 2013) proposed utilising African shipping and coastal trade to support infrastructure development and the growth of the African maritime economy. However, shipyards will need to consider the risks and opportunities presented by Transnet’s upgrading of local infrastructure including the Cape Town 130-year-old Robinson dry dock, the 70-year-old repair pier and Sturrock dry dock, and the 45-year-old Syncrolift. This extends to the development of R2 billion floating dock and Repair facility at Richards’ Bay by Transnet. Other demand is projected to increase from the refurbishment of small crafts and harbours by SA Department of Public Works/Chinese, promoting yachts and recreational vessels. In February 2019 Total discovered potential oil reserves of 1 billion barrels, possibly generating increased demand for offshore supply and gas repair vessels. Durban port also expands over 500,000 cars per year, hosting many ro-ro vessels. Maydon Wharf possesses the greatest sugar terminal in the Southern Hemisphere. Therefore, various opportunities exist to validate the investigation of South Africa as the most probable contender for investment in the global ship repair market.

1.4: Structure/Synopsis of Report and Overview

The report overview is structured to initially motivate the proposed case for a Panamax floating dock in Africa and globally. This includes an overview of global, regional African and local market trends or developments. This further presents a direct response to particular blue economy opportunities for the ship repair, building, conversion and demolition market from Operation Phakisa, AIMS and others. Chapter 2’s market analysis of the dock; port and economic hinterland; will further determine its competitiveness, efficiency and technical productivity against global and African alternatives. Its economic and financial feasibility and justification will further be investigated in Chapter 3, specifically in response to emerging maritime stakeholder requirements, demand and supply. Assessing its potential costs; benefits; disadvantages; risks and opportunities further motivates the extent to whether investing in the ship repair, building, conversion and maintenance markets reflects a viable, long term solution. Chapter 4 will further identify existing gaps to ensure the most technically proficient, environmentally sustainable, climateproofed, economically feasible floating dock scenarios are evaluated against prospective opportunity costs. Study limits and the significance of findings will also be highlighted.

SECTION II: MARKET EFFICIENCY AND COMPETITOR ANALYSIS

1. INTRODUCTION

This report’s core objective is to investigate the extent to which existing port, existing and proposed dock facilities are sufficiently efficient and competitive to sufficiently justify investment in a neo-Panamax floating dock for investors and the client shipyard. To resolve this, it initially investigates the productivity and capacity performance of port and back of port facilities in section 2. in relation to consulting and identifying stakeholder priorities and requirements. This is prior to determining the optimal capacity and efficiency of existing ship repair dock facilities, both floating and drydock in section 2. A South African case study is used as a hypothetical example not reflective of any current commercial decision but from maritime economist personal

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experience with Durban port. It also evaluates other local, regional African and international competitor facilities in sections 3-5. This will aid shipyards and potential clients to determine how sufficiently attractive and reputable the port is in relation to other ports, to generate optimal demand, supply and market feasibility characteristics in Section 3. It will aid them in creating the optimal floating dock and back of port layout, sufficient to maximise locational and technical economies of scale for cost minimisation. Identification of core competitors will enable shipyards to ensure their ship repair facilities remain not only competitive and commercially viable, but technically feasible, ecologically sustainable and minimise adverse externality costs and other emergent risks.

2. PORT AND BACK OF PORT/ECONOMIC HINTERLAND: EFFICIENCY AND PERFORMANCE ANALYSIS

In determining the extent to which existing and future port or ship repair facilities are efficiently performing, this report considers it essential to identify the core expectations of shipping companies, navies, port authority’s and other stakeholder’s needs or requirements. Table 2.1 was devised in consultation with core port and facility users. These requirements include that regardless of the port and repair industry’s presence, these stakeholders desire certainty that functions will exist with minimal disturbance risk to port, supply chain, business performance, community and environmental health and quality of life. They expect port authorities and other stakeholders involved are sufficiently informed, prepared and aware about proposed cruise industry arrivals, departures and impacts to prevent unnecessary delays. These stakeholders anticipate that they will not lose any functional requirement or be adversely affected by any related age changes.

If providing a neo-Panamax floating dock or drydock services are to be commercially, technically and socially feasible it must satisfy market demand with supply to adequately provide a consistent, adequate, profitable and productive service capable of allowing for fluctuations in growth, existing capacity and future projected growth. It is therefore highly recommended that shipyards need to satisfy the following Table 2.1 stakeholder requirements identified from this reports’ consultation with key stakeholders. The most significant is that it will not adversely impair nor be inconsistent and incompatible with existing tax, trade, security, environmental, legal, technical, training and other requirements. The extent to which business flourishes increasingly depends on the extent to which relationships are successfully coordinated and information shared to minimise disruption costs across stakeholders. Ship repair value chain stakeholders’ specific requirements differ significantly, but each seeks reassurances of professional speed, efficiency, cost reduction, value for money, hospitality and respect or being listened to, with any adverse or unusual incident addressed or arbitrated promptly, professionally, courteously and with customer service prioritised.

As Report One highlighted, South Africa’s port facilities are investing in significant port expansion and modernisation programmes to remain globally competitive. Operation Phakisa is considering a 10% growth in local content procurement and more minerals via local flagged vessels. Durban port remains the among the most efficient and competitive of African ports, within South Africa, regionally in Africa and the Southern Hemisphere. The decision to locate a neo-Panamax shipyard will enable the a shipyard to potentially service many of the vessel

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types and numbers of callers within South African ports, given strong geographical proximity to major shipping routes and intermodal transport/economic hinterland connections. Figure 2.1 identifies which South African ports can accommodate various vessel types and sizes. Durban port is able to take all vessel sizes apart from Cape Size and Suezmax vessels, which are targeted as part of Richard’s Bay’s proposed port expansion and drydock facilities. Durban’s plans to accommodate these vessels through a dugout Airport site has been paused due to political and contractual issues, community and environmental risks. However, existing modernisation plans will be able to service ultra large container vessels up to 18,000 TEU’s consistent with projected demand for the next 15-25 years.

Table 2.1: Aggregated Ship Repair Industry Stakeholder Requirements

Expectations of Value Chain Service Provider Commercial/Community ExpectationsProvide sufficient information AvailabilityPrompt Turnaround Time -port/Back of port SpeedTo consistently update information Promptness/swiftness of services/infrastructureSecurity Allocative/Productive EfficiencyCost Competitive Functions are modernized as much as possibleProductive/Efficient – swift and accurate processing Direct service/hinterland connections existReliable/frequent functions of sufficient quality Productive, trained labour responsive to needsSatisfying unusual requests – altering schedules/ flexible to changing circumstances

Sufficient Capacity exists Efficient – utilises capacity/economies of scale

Sufficient quantity of functions exists. Utilisation Rate Commercially profitable

It satisfies marginal caller requirements Equitable in satisfying the user pays principleIt avoids delays/strikes etc Minimises negative externality/congestion costs

Source: This Study.

Figure 2.I: Vessel Dimensions and Class Types For Various South African Ports.

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Source: TNPA 2018.

2.1: Durban Port Pricing and Cost-Competitiveness

One of the most significant factors determining the extent to which Durban’s port and associate facilities can attract these vessel types is cost-competitiveness. To a certain extent, evaluating South African tariff methodology and port pricing mechanisms internationally is complicated as they differ from most global ports, where typically some port capital costs such as quay walls; channels and breakwaters are funded through state or municipal budgets. Transnet National Port Authority, however, is entirely financially autonomous, responsible for seeking cost recovery. Although TNPA has higher profits deriving from its revenues indicating higher port charges, to some extent this is economically justifiable, given the lack of government funding and the extent of cross-subsidisation as a landlord (representing 15% revenue sources). Thus, Transnet is highly reliant upon port charges to finance services and infrastructure. It would greater satisfy economic efficiency upon the user pays principle if it were to increase rents, lease more terminals, cargo infrastructure and services to be rent generating; especially if combined with tariff reduction possibilities for greater port efficiency/ cargo throughput and cost minimisation. This satisfies international port pricing recommendations of greater equity via cost sharing between port users; aiding cargo operators cross-subsidizing operating and infrastructure costs. In a global study of South African versus equivalent global port prices (Port Regulator Authority, 2018; South African ports remained among the most internationally expensive ports for vessel callers. Interviewed stakeholders confirmed decreasing vessel services, partially in response to high costs, frequency of labour disruption, poor service and other requirements outlined in Report 3.

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The extent to which South Africa’s port pricing mechanism satisfies market efficiency, in the absence of differentiating between domestic ports, is considered through comparing international rival pricing mechanisms. Durban port has become increasingly more cost-competitive for ro-ro/vehicle related cargos at only 34.8% above equivalent international average port due costs in 2019, compared to a 212% premium above international averages in 2012. Whilst average cargo port users experience 198% above global averages in 2019 (up from 178% inn 2018); dry bulk vessels experience international comparative advantages at 46% below the average compared to competitor counterparts. Richard’s Bay coal total port costs is 49% below the average, whilst Saldanha iron ore is 31% below the average. Figure 2.2 illustrates South African port’s comparative advantage for coal with cargo dues 53% below global averages. This demonstrates improved competitiveness since 2012 (23% below the average), further aided by a 35.5% depreciation of the rand relative to the US dollar between 2012-2018.

Figure 2.2 South African Coal Port Due Costs (As Deviations From the Global Average).

Source: Port Regulator Authority 2018.

Containerised cargo remains highly penalised however, with port costs 271% above the global average compared to 874% in 2012 as illustrated in Figure 2.3. According to Figure 2.3 Durban and Cape Town, with per TEU cargo due, lack price competitiveness in relation to the global average given self-financing requirements but higher labour costs. Total port costs (including terminal handling costs) are expensive at 221% above global averages but more competitive than 560% in 2012. Durban and Cape Town are competitive in containerised vessel costs per standardised vessel, just below the global average of $25,095. However, it remains highly expensive for container vessels with average container cargo dues of $150,000 in 2019 (down from $250,000 in 2013) compared to a global average of $41,136. South African container terminal handling charges further emphasise the anticompetitive practise of South Africa’s port monopoly. They remain at 221% above the global average at $274,422 versus $88,299 internationally.

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Figure 2.3. South African Container Port Costs (As Deviation From the Sample Global Average)


From a port user perspective, the cost of utilising port facilities (often segmented into port and cargo dues) reflected through the port pricing, tariff methodology and structure and the aforementioned indicators, is paramount in determining their decision to enter ports. As Figure 2.7 illustrates, the time in port per ship, together with the daily capital and operating cost per TEU incurred by the shipper, the port and others can influence the total shipping cost per TEU. It influences the extent of potential demand and thus the degree to which marine, cargo and other infrastructure and services need to be augmented and expanded. As pointed out in Dyer (2015), it is essential to ensure asset cost recovery and a reasonable profit margin to finance the construction and maintenance of these port functions, basing port financing on the principles of equity and efficiency. Following a port’s expansion, ports also need to avoid either under or overpricing, which influences the extent to which stakeholders will support or value port investments. Underpricing inhibits potential port efficiency; requiring the opportunity cost of cross-subsidisation from either the state or other port stakeholders, violating the user pays principle. Overpricing reduces potential port efficiency through lowering quantity demanded of port services amid increasing global inter-port competitiveness.

Figure 2.4: Container Vessel Costs Per Standardised Vessel.

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Figure 2.5: Container Cargo Dues Per Standardised Vessel


Figure 2.6: Terminal Handling Charges by Port, US$ per Standardised Vessel.

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Source: Port Regulator Authority 2018

2.2: Durban Port Productivity and Efficiency Indicators

Stakeholders have reported other concerns, summarised in Table 2.2, when interacting with Transnet national port authority, other than high port process that potentially discourage global demand for port and ship repair facilities for Durban Port. It is advised that SA Shipyards ensure key concerns are addressed when aiming to operate Africa’s largest ship repair dock facility, especially with neo-Panamax capability. Dyer (2015) investigated the extent to which Durban’s existing and proposed port expansion was economically justified. It provided various indicators to assess the efficiency and productivity performance of Durban and competitor ports. It defined productivity as a ratio of output relative to input, or maximizing the returns on the initial injection for a fixed quantity in a port, based on reviewing over 125 sources. Tioga (2010) derives Port Productivity as either being affected by the rate and system of using resources or the capability to operate effectively – the rate of utilization or productivity. Specific port productivity indicators are outlined below. The extent to which Durban’s port is efficient can be evaluated by the following outlined thesis-derived indicators including Figure 2.6.

Figure 2.7: Measures of Vessel Efficiency Performance Indicators

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Source: De Monie 2005.

Table 2.2 Transnet’s Key Stakeholder Reported Issues.

Shareholders Funders CustomersCorporate social investment Policy and regulatory

uncertaintyOperational Efficiency and service reliability

Economic growth and jobs created Credit ratings Infrastructure capacity to meet demandFinancial stability – Governance/ PFMA compliance

Financial performance and stability

Competitive pricing and services

Improved profits, productivity and efficiency, lower logistics costs

Impact of global economic downturn

Ability to deliver on capital plan

Ability to deliver on capital plan Commodity demand forecasting uncertainty

Private sector participation

Integrate with region Capital prioritisation Social unrest and strikesLocalisation/skills development Social unrest/strikes Reliable Electricity supplyOptimise social, environmental and economic impact

Electricity supply Flexible, safe, swift

Suppliers Organised Labour Non-governmental organisationsFair procurement Higher wages Community benefitsLocalisation of procurement Transparency and trust Climate change mitigationBlack economic empowerment Skills development Waste managementLocal skills development Safety Biodiversity enhancementTransformation requirements for international suppliers

New union recognition Pollution – visual, noise etc

Employees Provinces/communities and municipalities

Parliament, regulators and policy making government departments

Safety, Dignity and respect Creation of local jobs and skills/local procurement

Execution of stakeholder’s mandate, accountability

Supervisory managerial skills Youth Development CompetitionRecognition and reward Consultation on port plans Environment protection and safety

complianceFair remuneration Social welfare support Infrastructure capacity creation

PORT EFFICIENCY INDICATORS

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Vessel Waiting Time for Berths: This reflects the frequency with which vessels can access facilities and the degree to which sufficient maritime infrastructure and services are provided in existing port capacity for projected port demand versus supply.

Average Cargo Dwell/Clearing Time: The time taken for cargo to be transferred and processed between the vessel via the shore to storage facilities/transport links, is a significant indicator in determining the degree to which sufficient cargo infrastructure and services is provided in existing port capacity and for projected port demand versus supply.

Average Customs Clearance Processing Time: This dissertation proposes a proxy measure for a historically ignored factor inhibiting a seaport’s performance potential, by assessing the time taken to complete customs formalities as an indicator of the extent to which customs procedures enhance or inhibit port user requirements and the extent to which customs can be modernised to improve port capacity.

Vessel Turnaround/Clearance Time: This reflects the total waiting, berthing and other port time to a vessel and its operators whilst utilising port facilities as a measure of its potential competitiveness and efficiency against other comparable ports.

Road/Rail Turnaround Time. This measures the total port time taken to collect/deliver cargo consignments as an indicator of the service, reliability, efficiency and quality of port superstructure, storage facilities and surrounding transport interlinkages affecting the dependent economy.

Durban Port Road to Rail Ratio. This measures the share between road and rail for containers leaving the port.

Total cost to port users per year. This indicates how cost efficient the port is over a specific time period compared to its competitors. It reflects port user willingness to pay for facilities and the extent to which a seaport can lower port user costs along with increasing potential macroeconomic benefits, by enhancing port performance through addressing concerns and constraints.

Tonnage of cargo carried per unit of worker/No of potential strikes/days lost: These are prototype physical estimates of the extent to which labour productivity has the potential to be improved for enhancing port capacity, given the influence of labour costs to total port user costs and potential port activity, historically ignored in port project research studies.

Gross crane moves per hour, Tonnage of cargo carried per running metre of quay, Tonnage of cargo carried per unit of cargo employed, Number of containers handled per ship working hour. These physically determine the extent to which cargo infrastructure, superstructure and services in terms of technology/capital equipment have the potential to be improved for enhancing Durban’s current and future port capacity and performance.

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PORT ACTIVITY/CAPACITY INDICATORS

Average Berth Occupancy Rate: This establishes the optimal berth configuration in projected port designs, as an indicator of port activity/capacity and projected demand for marine infrastructure.

Total Port Capacity and Traffic (TEU’s)/(No of vessels): In aligning projected demand with projected supply and utilisation of facilities and the extent to which ports and their functions can become more efficient to port users, these measures approximate the extent to which modernisation of existing site capacity and layout is a more feasible and cost-efficacious alternative to Durban and other physical port expansion developments. This ideally should be divided into different strategic port users, reflecting variations in port function requirements, efficiency and cost including dry bulk, container vessels and for cruise vessels (numbers only – ignoring any minimal cargo capacity).

Cargo Capacity Utilisation: Dividing annual TEU activity by estimated total TEU capacity; measures the extent to which potential port capacity is utilised.

In determining the optimal site for the neo-Panamax floating dock such as the suggested; this market efficiency analysis advises considering the above indicators. It needs to maximise locational economies of scale considering potential congestion and road/rail hinterland connectivity, proximity to air transport sufficient berth space and capacity along with equivalent landside capacity and cargo storage and distribution facilities. Traffic volumes from transport interlinkages and port layout affect berth utilisation and speed. The location of marine economic activities will aid in procuring parts and close proximity to potentially skilled labour from the SA Maritime School and Transport College, Transnet School of Ports, Durban University of Technology, UNISA, Mangosuthu University of Technology, TVET colleges and the University of KwaZulu Natal. The eThekwini Maritime Cluster confers certain locational strategic advantages for cost minimisation and locational economies of scale. Complimentary marine or blue economy activities such as yachting and recreation, dry bulk, cruise and ro-ro terminal, liquid bulk and containerised cargo operate within close proximity to be internationally competitive. However, Durban’s existing port already experiences significant cargo dwell time based on insufficient sizes, numbers and speeds of trains; high frequency of truck strikes (including recent Salisbury Island blockades) and low capacity for cargo storage with plans to redistribute cargo to a dry port at Cato Ridge/Hammarsdale 40 kilometres inland. However, customs are located on the other side of the port and require clearance prior to unloading and redistributing cargo.

This analysis further recommends a strategic site location will create technical economies of scale for marine and cargo infrastructure and services, land, labour, management and technology. Technical economies of scale refer to the possibility of lowering average costs or using fewer resources for the same output produced. These economies of scale aim to improve port user welfare via lowering long-run average costs maximising profits, augmenting efficiency and facilitating swifter cargo clearance, enhancing commercial opportunities. Locational economies of scale can affect time, opportunity and other user related costs, directly and

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indirectly for those dependent upon harbours. It is advised that SA Shipyards consider potential locations of clients and value chain stakeholders providing components and services; retaining sufficient flexibility to retain the floating dock’s mobility for significant ship repairs, offering advantages of static, drydock alternatives.

Both locational and technical economies of scale are therefore considered essential to improving current and future port arrangements before undertaking expensive projects such as a multimillion rand floating dock. These potentially improve welfare gains, in lowering costs and intensifying cargo throughput for port users. Idle capacity, equipment, technology, infrastructure, training and management with the potential to be upgraded and modernised for higher capacity/efficiency thresholds, is evidently inefficient. The concept of Port Efficiency is defined as a comparative indicator of current deficiencies in port performance – something is comparable against a specific standard/against other ports as a measure of port activity and efficiency. This is extended to consider the distinction between the potential of ports with complete utilisation versus their current degree of utilisation, as an indicator of the extent to which port productivity can be augmented further. Efficiency can be basically summarised as “the aggregate cost of passing cargo through a port.” As a comparative basis by which port planners can consider improving existing port performance and efficiency for Durban and other seaports; this report proposes a homogenous set of assessment criteria, concentrating specifically on indicators of potential port efficiency based on Dyer’s extensive review for Durban and other ports (2015). These can be classified as determinants of activity, time, effectiveness of ports and cost to port users. Research concludes that in order to validate the extent to which efficiency exists, the extent to which existing capacity is being utilised and to what extent congestion is apparent in current infrastructure, must first be determined. Table 2.3 provides certain financial and operational measures.

Table 2.3: Additional Indicators of Durban and Competitor’s Port Performances

Financial Indicators Operational IndicatorsTonnage worked Arrival timeBerth occupancy revenue per ton of cargo Waiting time; Service timeCargo handling revenue per ton of cargo Fraction of time gangs are idleLabour expenditure Turn-around timeCapital equipment expenditure per ton of cargo Tonnage per shipContribution per ton of cargo Fraction of time berthed ships workedTotal contribution Number of gangs employed per ship per shiftTons per gang hours Tons per ship-hour in port or berth

Source: Esmer 2010.

Examples of port activity financial and operational indicators (UNCTAD 2018) include: average berth occupancy rate, number of containers or tonnage handled per ship working hour, tonnage of cargo handled per running metre of quay, per unit of worker and per unit of capital employed, along with total port traffic, all of which can assess a potential productivity, efficiency and capability. Tioga (2010) adds the number of gate transactions and TEUs per acre/hectare and berth to establish a comparative basis of port activity per specific port area or facility. However, these are insufficient without considering the perceived functions and purposes of seaports plus different vessel and cargo types. Dyer (2015) emphasises average cargo dwell or clearing time

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for ports such as Durban as a particularly astute time, speed and throughput measurement of port efficiency, with the potential for upgrading current capacity for cargo infrastructure and services. As this time increases, facilities become congested, imposing significant opportunity costs to other port users (including port authorities). In assessing overall port expansion prospects, Esmer (2010) advises minimising turnaround time (total time spent in port) for vessels, road vehicle and railway infrastructure connections and also transport service frequency and reliability. This is essential in maximising revenue, the number of vessels and utilisation of facilities for the port authority, while lowering opportunity costs and being most cost efficacious for other prime stakeholders. Another time determinant of comparable port efficiency includes vessel waiting time for berths (including any congestion, port and cargo dues plus other costs). Port effectiveness can be improved via the potential for locational and technical economies of scale/port productivity enhancements to lower port user costs. Tempi (2006) summarised the following indicators of world class port proficiency, which this research contends Durban fails to completely satisfy:

• Container-stacking densities of 2,000-4,000 TEUs per hectare• Continuous ship-to-shore gantry crane productivity of 50 moves per hour• Three day cargo dwell times• 30 minute truck and railway turnaround times• Port market demand for improved railway capacity, access and service frequency • Berth water depth exceeding fifteen metres.

A port is considered post-Panamax ready when it has met four key criteria:

Channel depth of 16 metres with sufficient channel width and turning basin size Cranes capable of loading and unloading post-Panamax ships Docks engineered to incorporate new larger cranes. Sufficient port/back of port facilities to accommodate cargo throughput volumes.

2.3. Durban Port Efficiency Analysis

A market efficiency analysis of Durban port indicates high performance in relation to other African and Southern Hemisphere ports, but not when compared to rival global port competitors. Limited information is publicly available for most of the core indicators identified above. Those available are summarise in Table 2.4 below. Although new equipment has been invested in, consultation with shipping companies emphasised Durban port’s especially poor work ethic and approach to maintenance; as partially explaining why it is similar to Mauritius in moves per gross container hour, despite Port Louis possessing far older equipment. Low equipment availability and storm damage influenced productivity. However, Transnet are investing R2 billion in ship repair facilities including a Richard’s Bay floating dock by 2019, 7 additional tugs, a new pilot helicopter and recently acquired 7 post Panamax giant cranes.

Table 2.4: Efficiency Analysis of Durban’s Port Performance

Key Performance Area and Indicator

Unit of Measure

2017 Actual 2017 Target 2018 Target 2018 Actual

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Anchorage Waiting Time Average hours

33 N/A N/A N/A

DCT Terminal 1 Average hours

New 40, 30 36

DCT Terminal 2 Average hours

46 N/A N/A N/A

Berth Waiting Time Containers STAT hour

New 32 26 28

DCT Pier 1 Containers STAT hour

New 51 55 43

DCT Pier 2 Containers STAT hour

New 53 55 53

Berth Occupancy % 69 65-75 61 65-75Berth Utilisation % 89 85-95 75 85-95Container Dwell TimeDCT Pier 1

Days

Imports Days 2.7 3 3.1 3Exports Days 4.7 5 5.3 5Transhipments Days 5.4 10 6.6 10DCT Pier 2 Days 2.2 3 2.5 3Imports Days 5.5 5 6.1 5Exports Days 5.5 5 6.1 5Transhipments Days 5.9 10 7.8 10Moves per gross container hour DCT Pier I

No. 26 26 25 26

DCT Pier 2 No. 24 32 23 32Container moves per ship working hour DCT Pier 1

No. 45 53 46 50

DCT Pier 2 No. 55 70 53 65Train turnaround time DCT Pier 1

Hours 2.9 4 2.4 4

DCT Pier 2 Hours, 3.5 4 2.2 4Truck turnaround timeDCT Pier 1

Minutes 37 35 35 35

DCT Pier 2 Minutes 79 35 72 35

Source: This Study based on Transnet National Port Authority 2018.

Durban’s port volumes have increased to 2,960,000 TEU’s for containerised cargo. Port operations occur 24/7. However, this not necessarily a measure of the port’s comparative efficiency and performance but rather its geographical accessibility to Africa’s largest economic hinterland and strategic Cape Route; existing port capacity over rival African ports and Transnet’s monopoly position. Dry bulk cargo volumes expanded by 5.8% by year and liquid bulk by 3.1%. Ro-ro vehicles increased exports by 15% to over 487,000 in 2018 and imports by 4%. Transhipments are consistent around 15-20% of total cargo. South Africa exported 6.8% of total global coal and 4.4% of iron ore exports in 2017. Port users have complained of port turnaround time taking 16-48 hours for trucks, when it previously took 90 minutes. One interviewed shipping company was discouraged through over 60 days for their cargo to be sent from the Point railway marshalling yards to Gauteng, when it took 10 days voyage between Durban and Singapore. Average berth utilisation at 89% is congested compared to international

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averages of 70-75%. Since 2011 Durban port, has become increasingly more cost-competitive and efficient, as Table 2.5 analyses, especially in comparison to other African and international port targets. For example, average waiting time has decreased from 62 hours in 2012 to 33 in 2018.

Table 2.5: Durban Port Efficiency and Productivity Indicators (This Study)

Durban Measure 2011 2012 2013 Target 2013 Actual International Target

Average Annual Berth Occupancy Rate 84% 87% 75-85% 85%Vessel Waiting Time for Berths: Hours 63 46 63 46 24 (Singapore)Average Cargo Dwell/Clearing Time: Days 4.2 4 3.5 4 2Average Customs Clearance Processing Time: Hours

80 80 72 82 24

Vessel Turnaround/Clearance Time: (Days)

4.2 4 3.5 4 2

Road/Rail Turnaround Time: Minutes 40 37 35 32 Pier 147 Pier 2

20

Total cost to port users per year. Panamax

NA (Not Applicable)

$250,000 $150,332

No of potential days lost to strikes 6 4 NA 7 NAGross crane moves per hour 23 26 30 23 (Pier 1)

28 Pier 270

TEU per stat working hour 40 45 53 40 120No of containers handled per ship working hour.

84 86 100 136 200

Source Dyer 2015.

Transnet and the Port Regulator of South Africa are currently favouring the WEGO indicators which give 20% equal weight and measurement of Ship Turnaround time; Ship Productivity Indicator (total number of TEU’s/tons/kilolitres or number of units handled divided by total vessel time taken at berth; Vessel Delay at Anchorage; Berth Productivity and Ship Working Hour. This measure was adopted in 2017. The average weighted gain or loss for each measure are summarised in Table 2.6 for average 2018/2019 values. South Africa’s berths mostly confirm to the guideline of 1 crane per 100 metres of quay and average of 25 container crane moves per hour (Scholtz 2017; Zangwa 2018). Average moves per ship working hour have increased from 47-70 from 2012-2018 for Durban Container Terminal Pier 1. Gross container moves per hour have slightly increased from 24-33. It compares favourably with other African and international ports for certain indicators such as 33 hours versus a global average of 129 hours, 91 tons per working hour of cargo handled and 73 days cargo dwell time (UNCTAD 2018). However, Europe, Hong King and Singapore manages 1-3 days for cargo dwell time, up to 580 tons of liquid bulk per hour and 1,250 tons of dry bulk. However, average cargo dwell time has remained consisted at 2-6 days since 2011. Average berth occupancy decreased to 61% in 2017 from 85% in 2014. Africa’s training costs average 3.5% of average total yearly wage compared to a global average of 1.3%.

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Table 2.6: Port of Durban 2018-2019 WEGO Indicators of Port Performance

Automotive Containers Breakbulk Dry Bulk Liquid BulkKey Performance Measures Weighted Gain/Loss %Anchorage Waiting Time 13.8 13.3 11.6 13.6 13.6Ship Working Hour -1.2 2.3 1.1 1.6 -0.5Berth Productivity -8.1% 3.4 0.0 0.0 0.2Ship Productivity Indicator 4.7 -3.9% 28.2 -2.8 3.6Ship Turnaround Time -3.0 0.3 1.6 0.2 0No of Vessel Calls 3,184No of Operational Vessels 2,386

Source: Transnet 2019.

In conclusion, recent port developments are aiming to further modernise the efficiency of Durban’s and other proposed port developments such as a private Richard’s Bay, edible oil import terminal and 3 new dredgers. Yet, a high risk exists of a container quay wall failure. However, with the dugout port paused due to fiscal and projected demand constraints, Durban’s proposed R7 billion berth deepening suspended under investigations of procurement fraud and contract irregularities; this presents uncertain risks for new ship repair facilities such as a shipyard’s decision to invest in a floating neo-Panamax dock facility.

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3: FLOATING DOCK EFFICIENCY ANALYSIS

In order to determine whether or not shipyards should invest in a neo-Panamax floating dock, this section evaluates the components essential to ensure the most efficient ship repair facilities satisfying stakeholder requirements, competitive in South Africa, Africa and internationally. Global SOLAS requirements entail vessels to be serviced a minimum once per 5 years in a dry or floating dock. Passenger vessels need annual hull inspections. Therefore, facilities need to be able to sufficiently service all vessel components including engines, propulsion, navigation, fire prevention, safety equipment, electricals, mechanicals, wiring, bilges, pumps and water systems. Vessel repair facility types include graving (land/drydocks), floating and marine rail dock along with ship and marine mobile lifts for smaller vessels. Although there are no specific international requirements established for floating docks nor standards to assess their efficiency; this efficiency analysis identifies core characteristics based on an extensive literature review, stakeholder consultation and technical appraisal of South African and international ship repair facilities. Floating docks such as the one proposed for Durban’s Salisbury Island AMRSCOR site require the capacity to emerge and submerge. More detail is provided in the WSP Technical Assessment Report. It requires the ability to be efficiently and speedily de-ballast/remove water. It requires a sufficient shoreside space loading/unloading area and storage for equipment, cranes and possible removal of cargo, equipment and superstructure. It requires connections to electricity, waste removal/recycling and water along with the capacity to be mobile and operationally flexible as needed. It needs mooring equipment for sufficient stability and separating caissons to enable 2-3 smaller vessels to be worked on simultaneously to maximise suboptimal use and demand. For a vessel to utilise a dry or floating dock safely it needs sufficient stability, an upright position with no list, removed tank drain plugs, sufficient size to navigate; a small or moderate trim keel, minimal ballast and offloaded cargo as much as possible. Moorings need to be secured.

3.1: Existing Challenges and Floating Dock Requirements for Stakeholders

Challenges affecting Durban’s ship repair facilities were highlighted in a University of Natal Master’s thesis including the absence of specific initiatives favouring ship repair facilities, physical port constraints and structural/operational inefficiencies (Jonkers 2003). A degree of competitiveness exists between Transnet and the 3 private sector operators for smaller vessel repairs. Since 1905, the South African market has been restricted to 2-4 operators, excluding the government. From 1905-1978, existed African, Marine and General Engineering, James Brown Limited and Gilbert Hamar and Company, merging in 2012. South African Shipyards was founded in 1960 but acquired its name in 1996. Dormac entered in 2000. The potential neo-Panamax Durban floating dock market and value/supply chain will be analysed in Section III. Ship repair yards also need to provide vessel access points, personal protective clothing, handle materials capably, ensure capable cleaning, painting, coating, and other material/mechanical work. Sufficient infrastructure, labour, land, technology and experience that remains internationally cost-competitive are pivotal. Elgin, Brown and Hamar claim to obtain up to 70-75% of components are locally fabricated and 25-30% imported, whereas Dormac cite up to 5% of required resources and supplies are imported, with 95% local. Primary imports include bearings, valves, specialised engines, electronic equipment and services. A dry dock also needs pumps, a pumphouse or station and caisson chambers, keel, capstans, bollards, cranes,

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welding, refrigeration, and other dock equipment. Dormac pioneered a cofferdam technology system to replace and service rudders by diverting water, independently supported. The Robinson Dry Dock in Cape Town favoured pipe connected roller brushes to avoid paint spray whilst high pressure water cleaning, is more ecologically sustainable than sand blasting.

A shipyard is further considered to need the ability to conduct damage condition, cargo, hull, machinery, salvage, wreck removal, general average, third party liability and other surveys. More efficient docks have established supply chains to procure parts sufficiently in advance so as to minimise vessel turnaround time and idle berthing capacity costs. Vessels consider drydocking costs in close proximity to existing and scheduled trade routes. Quality and speed are frequently perceived as more essential than cost in determining projected market demand and potential efficiency. Sufficient records and information need to be adequately developed to ensure all costs, risks and challenges are monitored and learnt from, to internalise externalities. Other South African ship repair industry challenges include labour, an absence of locally registered ships including a declining fishing fleet, issues over port competitiveness, environmental, quality and productivity concerns along with the need for an actual floating dock facility capable of satisfying post-Panamax demand of sufficient length, width and depth. A common user booking system for Transnet’s Prince Edward Graving Dock, mostly several months in demand; limits total operational time and availability of current facilities. Therefore, SA Shipyards can benefit with its independently operated floating dock proposal provided it ensures sufficient capacity, zoning, quay and storage space with sufficient cranes and equipment. Yet to generate sufficient regular newbuilding, ship repair, maintenance, conversion and demolition market revenue and dock utilisation rates, these facilities will be increasingly compared to international Middle East and Asia rivals such as Singapore, Taiwan, Japan, China, Korea and Vietnam, as sections 4/5 emphasise.

3.2: Current SA Shipyards and Transnet Dock Facilities in Durban

Aside from stakeholder requirements listed in Table 2.1, the most efficient floating neo-Panamax dock for Durban is advised to consider vessel sizes and dimensions compatible with demand/supply market characteristics in Report 3. Current layout is strategically located in close proximity to the graving dock and road/rail connections although a significant difference from commercial vessel berths, customs clearance and Transnet Port Authority. Figure 3.1 provides SA Shipyard’s current repair facilities. Whilst existing facilities experience a certain competitive efficiency advantage for smaller vessels, they currently lack physical access or experience at the current sites for Panamax class and greater vessel dimensions. The vessel condition and type of repair needed will determine the extent to which the floating dock requires being mobile and the ability to access road/rail connections to obtain raw materials/resources. The vessel’s schedule route and budget will further influence the extent of the facility’s demand and competitiveness. Shipyards in undertaking floating dock are advised to consider ensuring sufficient buoyancy, stability, a small moderate vessel trim aft, environmental factors and climate/climate change related risk events; to minimise adverse risks. It also requires effective communication, training and cooperation between ship crews and repair facility workers. Common repair needs include bilge and fuel pumping, cranes, piping and hatches. South African Shipyards (SAS) already possesses significant facilities. These facilities will need to be sufficiently provided at the proposed new floating dock size, to adequately address stakeholder

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requirements and emerging vessels up to the maximum neo-Panamax dimension limits. Current SAS ship repair facilities include 11.2 hectares with 20,000 m3 of covered facilities and private floating dock with 4,500 ton vessels maximum capacity and dimensions up to 75 metres, length 50 and wall width 30 metres with two 30 ton cranes. A 200 metre Repair Quay presents access to electricity, compressed air and water. It employs 420 skilled people including a current 42 apprentices, aiming for 60 apprentices in marine engineering.

Figure 3.1: South African Shipyards: Existing Ship Yard Repair Facilities

Source: SA Shipyards 2019.

However, it currently experiences the commercial risk of being dependent on Transnet, first for access, and second in ensuring the graving dock is sufficiently well maintained and operated. Facilities include ten cranes, steel fabrication, a paint, wielding and pipe fabrication workshop, propulsion, tank cleaning, marine engineering and electrical services, customs bonded warehouses and stores (South African Shipyards 2019). Others include riding squads, float, propeller, thrusters, tunnel rebuilds, rudder stock, precision machinery, hull treatment and survey capacity. It has gained experience through providing construction of recreational, naval, patrol and pilot vessels along with myriad repair types. They are able to source sampling and chemical analysis, fuel, lubricants, solvents and basic marine equipment/products. SA Shipyards is in close proximity to competitor rivals such as Dormac and Elgin, Brown and Hamar (Figure 3.2). Staff are trained to international standards, capable of working 24/7. It can access the Prince Edward Graving Dock (Figure 3.3) from its main competitor Transnet National Port Authority. This is the largest drydock in South Africa and Africa and originally justified on the following grounds. “To keep pace with the shipping trade already established and the expansion there is every reason to anticipate, it is therefore, desirable that adequate port and terminal facilities, the equal at least of those provided at ports in other parts of the world, should be available to encourage shipping to Union ports. And not least important of such facilities are those for enabling the cleaning and repairing of vessels. Indeed, a graving dock although, seldom, if ever, showing an adequate return on cost, is a necessary adjunct to any port of even moderate size and quite indispensable where there is a likelihood of such services being

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required by large ocean vessels.” (The New Graving Dock at Durban, Natal, July 1924 Jonkers 2003). Transnet facilities are summarised in Table 3.1. As a competitor it is unable to accommodate the majority of major Durban port callers. This dock has an entrance depth limit of 11 metres and width of 33.52 metres, overall dock length of 352.04 metres, divisible into an inner dock of 138.5 metres and outer dock of 206.9 metres. Existing de-ballasting time is four hours, comparable to international standard averages of 2-6 hours. It hosts 1 50 ton, 1 24 ton, 15 and 10 ton crane along with two 8 ton cranes. Transnet also operates a 109 mete long, 4,500 ton floating dock and 230 ton floating crane with 4 slipways, repair workshops, electrical and hydraulic facilities.

Figure 3.2: Bayhead, Durban Private Ship Repair Dock Facilities


Figure 3.3: TNPA Durban Graving and Floating Dock Facilities.


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3.3: Private Sector Durban Competitors to South African Shipyard Dock Facilities

The purpose of this section is to provide an overview of the competition in terms of the global, regional and local ship repair market. This will contribute to the identification of gaps in the market area that will stimulate the demand for the proposed floating dock development in Durban. It is likely that demand is going to emanate from ships that are plying the Indian Ocean Trade Route (Figures 3.4 and 3.5) mainly and this will be taken as the primary market area. It is assumed that the major competition would be ports along the Indian Ocean Trade Route as shown in the figures below. The focus in this section therefore is the large floating docks in the ports identified within the delineated market area. Direct Competitors are considered to be shipyards with Floating Docks of at least 250 metres in length. It is assumed that the docks/harbours/ports outside of the Indian Ocean Trade Route have a different target market compared to the proposed floating dock development and therefore are of limited consequence to the proposed development. The following assessment provides the supply side input into the market demand model. In many ship repair industries around the world, the ship repairers operate and own the facilities (docks). Ships are mobile and can pick and choose where it suits them to dry dock. They also represent very large capital investments with competent back-up management staff able to plan the operation and maintenance of their vessels. Owners actively seek the best deal on ship repair they can get, sometimes planning up to a few years ahead. Irrespective of the set-up in any particular port, there is no such thing as a monopoly in ship repair and ship repairers have to be competitive on an international basis.

Figure 3.4: Indian Ocean Trade Routes Overview

Source: Tes Teach with Blendspace 2017.

Figure 3.5: Indian Ocean Trade Routes in Detail

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Source: Tes Teach with Blendspace 2017.

Ship Repair is generally considered as an evergreen industry, both globally as well as domestically. Ships, being floating structures, require regular inspection and maintenance of equipment and machinery for smooth and safe functioning during the ocean voyages and during cargo handling operations at Ports. Ships are also generally governed by scheduled periodic repairs for which the Classification Society and other Statutory Bodies have formulated guidelines for periodic survey such as; Special Hull and Machinery surveys every five years, Drydocking at two and half years and Hull and Machinery annual survey every year. Hence ship repair yards generally have continuous and consistent flow of business which makes ship repair revenue generation more predictable as opposed to shipbuilding or shipping, which is often prone to pulls and pressures of market forces and cyclic change. The ship repair industry is directly linked to the activities of ports and tends to be very volatile at times, resulting in extremely active times followed by depressed times. E.g. closure of the Suez Canal in the 1960’s - huge increase in activity in the ship repair activities in Durban. The world financial crisis that started in 2008 resulted in a collapse in vessel charter rates, which in turn caused a severe downturn in the repair market.

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The South African ship repair industry was last surveyed and evaluated in 2012. The private sector includes Dormac, Elgin, Brown and Hamar along with SA Shipyards and Sub-Tech in Durban; Damen and DCD Dorbyl in Cape Town. The nine South African ports that fall under the custodianship of Transnet, as per the National Port Regulations of 2005, include: Port Nolloth, Saldanha Bay, Cape Town, Mossel Bay, Port Elizabeth, Ngqura, East London, Durban and the Port of Richards Bay (Figure 3.6). South Africa‟s shipbuilding and support segment of the industry is largely dominated by five companies that includes South African Shipyards (which builds tugs and deep-sea patrol vessels and undertakes repairs), Damen (specializing in tugs, patrol vessels, research vessels, barges and pontoons), DCD-Dorbyl (provides turnkey ship repair solutions to the marine and oil & gas sectors), Dormac (specializing in double hulled bunker barges, harbour, pusher tugs and dumb barges construction and providing ship repair solutions to the industry) and Elgin Brown and Hamer (which provides the international ship industry with a full in-house service in all aspects of ship repair). Shipbuilding and repairs facilities in the ports such as graving docks, quays and floating docks or slipways are owned and operated by Transnet National Ports Authority (TNPA). Only one floating dock is under private sector undertaking, i.e. Elgin Brown and Hamer floating dock in Durban. There are also smaller slipways in fishing harbours under the control of the Department of Environmental Affairs.

Both Dormac and Elgin, Brown and Hamar’s 8,500 ton floating docks are 155 metres long, 23 metres wide and 6.5 metres depth. Transnet National Port Authority operate facilities in Durban. Dormac’s facility (Figure 3.7) contains back of quay support facilities, two 7.5 ton cranes, biometric security access points, computerised levelling and loading technology and two compensating ramps. It offers a 195 metre, dedicated private repair quay with 8 metre draft. As a competitor it also offers similar facilities to South African Shipyards, except Cameron riser refurbishment and a fabrication outdoor grillage to preassemble barges, accommodation modules and other equipment. The grillage facility covers 1 60 ton, 2 30 ton, 1 25 ton and 1 15 ton crane. Its hatch repair facility can manage 37 hatches simultaneously. It also hosts a 140 metre, 35 metre width, slipway. Dormac are aiming to increase facility demand to 42 vessels per year from 8. Another floating Dock named Dormac Dock 1 is unique to all other Floating Docks in operation in South Africa and neighbouring Namibia, Dormac Dock 1 is equipped with the latest state-of-the-art technologies which include two 7.5 ton cranes. The floating dock is attached to two pawls on the floating docks’ dedicated quay which is a 175m’s long. This area is ideal for offshore fabrications, conversions to ships, equipment laydown and of course support to the east coast oil and gas projects. With the Floating Dock alongside a newly built repair quay, as opposed to the more common ‘Mediterranean-mooring type of placement, the ship repair is more efficient. Dormac Dock 1 is the first brand new composite floating dock to enter service in Southern Africa. Dormac Dock 1 allows Dormac not only to accommodate a greater volume of clients’ vessels, but also to better utilise existing Panamax docking facilities.

Dormac Pty Ltd, the major player in the ship repair industry in Durban, also introduced a unique cofferdam system of repairing ships without having to enter a dry or floating dock. An added advantage of this new technology emanates from the fact that vessels are not required to offload cargo, to carry out repairs. The cofferdam has been specially designed, developed and patented by Dormac to carry out any repair work required on damaged rudders as though in the dry-dock. The cofferdam technology entails a water diversion or fluid retention system for use in

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open water and is used for construction, rehabilitation, and flood protection and inspection projects. By utilising a unique freestanding steel support system and impervious fabric membrane, the technique allows many types of in-water construction and repairs to be accomplished in "dry conditions”. Repairers in Durban have indicated that they find themselves in a competitive industry. Two rather conflicting views were obtained with regard to the barriers to entry as Dormac indicated that the barriers to entry are low, while EBH indicated that they are high. While both EBH and Dormac indicated that local and international competition is high, mixed responses were received for national competition. Competitive rivalry is identified in Table 3.1. Though Dormac indicated that national competition is moderate, EBH felt it to be low, due to their representation in the other major ports, but also due to the Terminal Status of Durban.

Table 3.1: Competitive Rivalry Within the Durban Market

Repairer Local Competitors National Competitors International CompetitorsDORMAC Elgin

MSC WorkshopElginDorbylGlobe Engineering

Far EastSingapore and ChinaVietnam and Korea

EBH Dormac DorbylGlobe Engineering

Far EastSingapore and ChinaVietnam and Korea

Source: Jonkers 2003

Figure 3.6: Existing Ship Repair Facilities in South Africa

Source: Jonkers 2003.

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Table 3.2: Transnet National Vessel Construction and Repair Facilities in South Africa

Facility Capacity (tons) Length (m) Beam (m) Draft (m)Richard’s Bay Plan for 2 hectares

None None None None

Durban Graving Dock Floating Dock SlipwayExclude 3 private floating docks

80,0004,50050

35210920

33.023.05

12.66.02.7

East London Graving DockSupport vessels, tugs

30,000 200 24.8 10.0

Ngqura None None None NonePort Elizabeth Slipway 1,200 60 12.0 4.5Mossel Bay Slipway 200 30 12.0 3.0Cape Town Sturrock Dock Robinson Dock Synchrolift A Berth

120,00017,0001,800275 (afloat)

3691616176

45.120.715.0

13.77.9611.8

Saldanha Bay Slipway 1,200 NA NA NA

Source: SAMSA 2012; Transnet 2017.

To address Dormac’s other competitor advantage; it is recommended South African Shipyards consider; is its mobile ship repair teams with the capacity to be deployed elsewhere in South Africa, Africa and globally to assist vessels to reach repair dock facilities. In assessing local ship repair facilities; consulting the professional South African Association of Ship Repairers noted overall efficiency and performance often depends on factors beyond the dockyard’s control such as climate; environment; extent of professional crew and maintenance standards/schedules for the vessel clients. Repairers often have to manage unfamiliar vessels with skeleton or non-existent crew. Yet repair teams may only involve 2-50 people. As offices remain separated from facilities, this requires capable supervision and experience to resolve decentralised control of labour and equipment. Other risks impairing the capacity and performance include those relating to port/back of port services outlined in Section 2.1, frequently complained about by shipping firms but highly dependent on the extent of professional relationships and connections between the ship repair facilities, Durban or other host city and port authority.

Figure 3.7: Competitor Dormac’s Floating Dock Repair Facility, Durban

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Source: Dormac website, 2019.

The other private competitor floating dock is operated by Elgin, Brown and Hamar (Figure 3.7), specialising in similar services, such as underwater dives, pipe/cable maintenance, surveys and dredging services. It possesses alignment and vibration analysis, cargo pump and turbo charger repairs, tail-shaft surveys and marine equipment. Damen Shipyards in Cape Town offers access to the current Transnet facilities and own floating dock but 6 synchrolifts and similar facilities to Durban’s port but is unable to service post-Panamax size vessels. This report contends ship repair facilities within South Africa need to consider design, material procurement, fabrication, surface preparation, painting, outfitting, testing and delivery capacity in alignment with value chain requirements identified by SAMSA (2012). 75 registered boatbuilders existed with 65 building and repair yards. The sector contributed 23,750 jobs and R5.01 billion. South Africa’s skills depended on 20 South African Shipbuilders and Repairers Association members, 75 SABBEX members, 435 of SAIMENA and 75 Marine Industry Association members.

Figure 3.7: Competitor Elgin, Brown and Hamar Shipyard, Durban.

Source: Elgin, Brown and Hamar website 2019.

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The only commercial dry-docks along South Africa’s coastline capable of taking larger commercial ships (although still small by international standards and quickly becoming largely obsolete due to the cascading effect of ship sizes) are found in Durban and Cape Town. The port of Cape Town is a full-service general cargo port, ideally situated to serve as a hub for cargoes between Europe, the Americas, Africa, Asia and Oceania. Amongst the South African ports, the Port of Cape Town has been the leading port for rig and vessel repairs due to its location, infrastructure and capacity with two dry docks; a repair quay and ship lift facilities. The bulk of ship repair activities and all oilrig repairs take place in the Port of Cape Town with Durban being second and East London third. Cape Town port offers extensive ship repair facilities with the main dry dock, known as Sturrock Dry Dock, having an overall docking capability of 369 metres length and 45 metres width at the entrance top plus a depth of 14 metres. The dock can be divided into two sections of varying lengths to accommodate two vessels at the same time. The Robinson Dry Dock in the Victoria Basin measures 161 metres in length with an entrance top of 20 metres and a depth of 8 metres, accommodating smaller vessels especially those associated with the fishing industry. The port also has a synchrolift capable of handling ships up to 61metres in length, 61 metres beam and 1,750 tons, as well as a repair quay situated in the Duncan Dock.

A sharp decline in the number of vessels repaired in the Port of Cape Town can be attributed to the increased number of large oilrigs and ocean-going vessels. These vessels take up a larger portion of the ship repair capacity due to their size and duration of their stay in the repair facilities in the port. In the Eastern Cape, ship repairs are undertaken in the East London Graving Dock which has a docking length of 200 meters and a repair quay of 106 meters available adjacent to the dry-dock. The port of East London has a dry dock with the capacity to accommodate vessels with a beam of 10 metres draft and 23 metres width, with an overall length of 200 metres. Even though Elgin Brown and Hamer Pty Ltd (EBH) operates a shipyard in East London and utilises the dock, it is quite underutilised. The reasons for this include:

The port of East London does not enjoy the terminal port status as Durban; The maximum draught in the port is 10.4 metres; and The principal deep sea callers are car carriers and grain bulkers.

Both Port Elizabeth and Mossel Bay have very limited ship repair facilities and repairs are mainly done alongside the Port of Ngqura. Available space within the Port of Ngqura is being utilized for maintenance and repair work, especially in the oil and gas sector. In Saldanha Bay the port accommodates the repairs and upgrades of offshore semi-submersible drilling rigs, Jack-Up rigs and other vessels requiring deeper water depths due to their draft restrictions. Transnet has placed a floating dock and ship-repair facility back on the agenda at the Port of Richards Bay, with a forecast completion date of March 2022. One of the inherent strengths of the Richards Bay port is its deep-water infrastructure, with a maximum permissible draught of 17.5 metres while further offering a repair quay of 300 metres in length and 7.7 metres in depth. The installation of a new large floating dock to bolster ship repair capacity at the Port of Richards Bay and to accommodate Capesize vessels, bulk carriers and tankers greater than 150,000 dwt, that now cannot be accommodated in any dry dock facility in South Africa, remains on track in Richards Bay, according to the TNPA. The Port of Durban is equipped to handle ship repairs at the Prince Edward Graving Dock, two floating docks and a slipway. In the Port of Durban, the Prince Edward Graving Dock can be separated into two separate compartments,

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one of 206.9m and the other 138.7m. The dock has five electric cranes ranging from 10t to 50t. The Port of Durban has two floating Docks, RMAC’s floating dock has 8500 tons lifting capacity 155,3m LOA and 26m beam with two 7.5 ton fully functional cranes. Jonkers (2003) noted that stakeholders expressed a number of reasons why ship repair demand was declining including very poor cost-competitiveness; inadequate maintenance and no investment, inadequate cranage, poor service delivery, inadequate facilities, conflict of interests between the NPA and the industry, low productivity and skills shortages. Several of these however, are being targeted by existing shipyards. A degree of competitiveness exists between Transnet and the 3 private sector operators for smaller vessel repairs. Since 1905, the South African market has been restricted to 2-4 operators, excluding the government. From 1905-1978, existed African, Marine and General Engineering, James Brown Limited and Gilbert Hamar and Company, merging in 2012. South African Shipyards was founded in 1960 but acquired its name in 1996. Dormac entered in 2000. The potential South African floating dock market and value/supply chain will be analysed in Section III. Ship repair yards also need to provide vessel access points, personal protective clothing, handle materials capably, ensure capable cleaning, painting, coating, and other material/mechanical work. Primary imports include bearings, valves, specialised engines, electronic equipment and services. A dry dock also needs pumps, a pumphouse or station and caisson chambers, keel, capstans, bollards, cranes, welding, refrigeration, and other dock equipment. Dormac pioneered a cofferdam technology system to replace and service rudders by diverting water, independently supported. The Robinson Dry Dock in Cape Town favoured pipe connected roller brushes to avoid paint spray whilst high pressure water cleaning, is more ecologically sustainable than sand blasting. Improvement is needed in South Africa’s ship repair facilities in part due to a lack of maintenance as well as very limited infrastructure spending. This, combined with the size limitations of the existing facilities, presents a number of challenges going forward. The implementation of the tariff strategy that introduces a cross subsidy aimed at making these facilities financially viable together with a focus on certain niche markets like recreational yachts, tug boats, ferries, naval vessels etc. may see the positive outcomes of renewed investment spending over the next five years.

3.4: Other Ship Repair Facilities/Floating Dock Characteristics To Consider

A shipyard is further considered to need the ability to conduct damage condition, cargo, hull, machinery, salvage, wreck removal, general average, third party liability and other surveys. More efficient docks have established supply chains to procure parts sufficiently in advance so as to minimise vessel turnaround time and idle berthing capacity costs. Vessels consider drydocking costs in close proximity to existing and scheduled trade routes. Quality and speed are frequently perceived as more essential than cost in determining projected market demand and potential efficiency. Enough spare parts are necessary to be pre-ordered. Sufficient records and information need to be adequately developed to ensure all costs, risks and challenges are monitored and learnt from, to internalise externalities. Other South African ship repair industry challenges include labour, an absence of locally registered ships including a declining fishing fleet, issues over port competitiveness, environmental, quality and productivity concerns along with the need for an actual floating dock facility capable of satisfying post-Panamax demand of sufficient length, width and depth. Vessels are footloose and operators can plan several years ahead based on factors including skills, quality of customer service,

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pricing, reputation, experience, port performance, facilities and trade routes. A common user booking system for Transnet’s Prince Edward Graving Dock, mostly several months in demand; limits total operational time and availability of current facilities. Therefore, shipyards can benefit with an independently operated floating dock proposal provided it ensures sufficient capacity, zoning, quay and storage space with sufficient skilled labour, cranes and equipment. Yet to generate sufficient regular newbuilding, ship repair, maintenance, conversion and demolition market revenue and dock utilisation rates, these facilities will be increasingly compared to international Middle East and Asia rivals such as Singapore, Taiwan, Japan, China, Korea and Vietnam, as section 2.4/2.5 emphasise.

Port charges and dues, docking and dry-docking fees are perceived to be excessively high and are not in line with international levels. This creates problems for the competitiveness of the industry as these fees are regarded as an impediment to the promotion of South Africa as the preferred location for the region for major upgrades and refurbishments. For example, in Durban more than 85% of all ship repair work carried out is for international ship owners and as such, it is a highly competitive industry internationally. However, with high port dues and charges, the industry will continually lose its market share to price-competitive countries. The condition of South Africa’s facilities for ship repair is not good, leading to low efficiency due to docking times, lack of cranage, poor access to the vessel, and high level of environmental hazards. Moreover, the size of vessel repairs facilities is becoming too small for the increasing number of larger vessels, which are being lost to other repair areas worldwide. Most of the key facilities are owned and operated by TNPA. For TNPA this is not their core business and it does not generate sufficient funds for these operations (docks, quays, repair facilities) to justify proper maintenance yet alone modernizing and upgrading.

At this stage it does not appear that TNPA, are prepared to expend large amounts of capital in bringing the equipment up to standard as the return to them for such capital expenditure would be limited. In fact, it is understood that the Authority is considering divesting themselves of ship repair facilities, including the graving docks, synchro-lifts, slipways and workshops to focus on their core business in the ports. Some of the recent port development proposals have indicated that most of the ship repair area would be lost to cargo operations as TNPA concentrates on port development to increase the cargo throughput in each port. As a result, any private initiatives to put in additional facilities will not be considered feasible due to the potential lack of tenure. This structure misalignment in respect of the TNPA facilities and the ship repairers has resulted in a serious barrier to the industry meeting its potential. Domestic ship repairers have been “handicapped” by the shortage of drydock facilities in South Africa as well as Transnet National Ports Authority’s (TNPA’s) commitment to a “common user” principle to maintain control over the port. Private ship companies are willing to invest in these facilities themselves, but they can’t get permission from the TNPA, because of government’s commitment to the common user principle and the fact that they want to maintain control of access to port assets. This is a very different institutional model (than that of most international ports), which have large, vertically integrated shipyards that own or lease waterfront land and provide everything themselves. The market could be substantially larger and more profitable if TNPA invested more or allowed private companies to invest in drydock facilities.

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TNPA’s “monopoly” pricing, is largely viewed as based on an over-valuation of its assets and established to recover the authority’s overhead costs and observe a high rate of return rather than being based on what the market could bear. This has reduced competitiveness and discouraged the efficient use of port assets. In addition, the ports authority does not want the ship repair and building sector to “interfere” with its core business of cargo handling. As a result, local ship-repair yards are moving out of South Africa into Ghana and Mozambique, which is a terrible indictment on South Africa. While South Africa would “never” be able to compete with Asian countries in terms of volume-based shipbuilding and repair work, it could service a regional niche market for small vessels such as navy patrol boats, port craft, research and fishing vessels and workboats. South Africa emerged as “around average” compared with the ship repair competitiveness of 74 countries, but remained the highest ranked country in Africa. Some 130,000 ships a year called at South African ports, while a further 17 000 were in transit past the Cape, which translates into a potential total repair market of between R30-billion and R40-billion a year, of which South Africa holds a 5% market share. South African ports have varying levels of infrastructure and service offerings to the fishing, oil and gas, and smaller cargo vessel sectors. With the sheer volume of marine traffic around the South African coastline providing an immense potential market for various levels of ship repair. the NPA’s plans to develop the Port of Saldanha Bay as part of Operation Phakisa including the refurbishment of much neglected facilities across the port system together with the built-in tariff subsidy incorporated by the Ports Regulator in the Tariff Strategy for ship repair, are being viewed as potential catalysts which will assist South African companies to play a more significant role in the servicing of rigs and other offshore supply fleets

Shipyards will also need to price usage sufficiently to maximise efficiency and cover fixed/operating costs such as port costs to Transnet as outlined in Table 3.2 and Report 3. (TNPA 2018). Port users currently pay R10,545.02 for vessel mooring use of the drydock and R4,651.67 for the synchrolift in Cape Town and East London. In Durban the drydock costs the same but the existing floating dock is R10,347.07. Additional costs comparing Durban’s daily drydock and floating dock costs with other South African ports for vessels up to Panamax class are summarised in Table 3.3. This emphasises that there are no comparative price differentials to favour using Durban over Cape Town or East London, despite other potential divergences in quality of labour, facilities, port productivity, speed and performance. The most significant factor remains overall cost of service compared to other rival dry and floating docks. International estimates and respondents indicate that docking costs are closer to 10% of the budgeted total repair costs. Durban’s can exceed five times this amount.

An efficiency analysis, indicates Durban’s initial tariffs are highly competitive for initial costs. However, the actual operating costs of facilities based on high port charges suggests Durban loses its competitive advantage based on Transnet port’s ownership monopoly position and strategic competitive advantage over rival African ports. It is thus able to charge significantly higher operating costs over 24 hours and subsequent 12 hour periods, more than competitors, as a further disincentive to remain utilising these facilities, except in emergencies. Any inefficiencies encountered in Durban’s port performance, (as noted above and via stakeholder consultation), are subsequently magnified to extend vessel costs; such as labour strikes, truck protests near Salisbury Island, poor equipment maintenance and rail utilisation rates. However, this further strengthens the argument for alternative international and local shipyards to provide

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a competitive rival service to Transnet, independently operated, with lower projected maintenance, operating, insurance and fixed costs along with greater availability of facilities. Whilst, Durban and other international port facility costs remain the same, this report notes that Grand Bahama Dock 1 appears not to have changed prices since 2011, not even inflation adjusted, providing an “unfair” market competitive advantages over Durban. This partially enables it to be 48.1% cheaper than Durban.

Table 3.2: Durban Drydock Costs Versus Cape Town and East London

Vessel Size tons

Cape Town and East London First 24 hours

Subsequent 12 hours

Vessel Size tons

Durban Dry Dock First 24 hours

Subsequent 12 hours

Vessels <3000 Plus per Ton

6,919.762.03

3,459.850.68

0-30,000 16,762.352.85

8,381.160.97

3,001 -6000Plus Per Ton

9,108.502.32

4,554.260.76

30,001-60,000 34,906.84 17,453.44

6,001-10,000Plus Per Ton

15,996.522.85

7,998.261.12

60,001-80,000 Plus Per ton

41,504.832.85

20,752.430.75


16,748.762.85

8,374.391.12

>80,000 tons fees are available on application


34,906.842.85

17,453.440.97

Floating Dock


41,504.832.85

20,752.431.11

0-10,500 gross tons/m3

16,449.70 8,224,84

>80,000 tons Fees are available on application

Plus Per Ton, 2.82 1,12

Source: Based on Transnet National Port Authority 2018.


An efficiency analysis assessment of Durban and other international drydock/floating dock repair facilities is challenged by the commercially sensitive and confidential nature of cost information. Report 3 presents a more detailed cost-benefit evaluation appraisal. However, South Africa appears to be cost-efficient and competitive in regard to steel and other locally obtained resource inputs, costs of water, electricity, waste disposal and mechanical services/trained labour. South African steel prices are dominated by one company of Arcelor Mittal, yet between 2010-2018, it lacked profitability. These are internationally competitive from R8,338 per ton to R 9,308 per ton but domestic consumption has decreased. It is significantly adversely impacted by high fixed costs of docking, port, maintained equipment, certain imported components and other factors for which the shipyard is not directly responsible (i.e. Transnet high port tariffs). Vessel dimensions are summarized in Table 3.5. Costs however differ, based on the extent and nature of repairs/ maintenance required; the efficiency and maintenance schedules of the port, dock and vessel berthed, age and type of vessel; climate; environment; labour productivity, extent of automation; degree of components locally sourced versus those imported and specific stakeholder requirements among other factors. This therefore further complicates any direct comparison of a specific ship repair facility against other facilities.

Other factors determining the extent to which Durban’s ship repair and dockyard facilities are sufficiently efficient; include their risk management process to preserve safety, security and

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avoid any issues that potentially conflict with other usages of Durban’s port. It should aim to minimise effects from spraying paint/cleaning materials; avoiding traffic congestion, environmental, sound, smell, pollution, liability and other risks, detailed in the separate Environmental Impact Assessment report and Section 4 on risks. Dormac however experienced a 16 year delay in obtaining permission, with a 2 year environmental impact assessment from Transnet for its floating dock. It perceived a floating dock as more efficient in permitting more shoreside space over a drydock alternative. To improve efficiency, it added 2 fire services, 4 ballast electric pumps and 2 high voltage transformers and an office 50 metres from the dock entrance. Innovative shipyard solutions (2018) created a centralised spare parts database. 24/7 accounts, centralised procurement for economies of scale and inventory management systems. Internationally, port standards require vessel crews and ship repair facilities to possess a permit containing the following. From stakeholder consultation, core considerations influencing the port authority’s decision to enter and allow vessel repair facilities include:

The nature of the maintenance or repairs to be carried out. The nature of the berth occupied by the vessel. Waste expected to be generated by the maintenance or repair. Particular measures to be adopted in the case of hazardous wastes. Responsible person/people on the vessel and extent of crew availability. An undertaking to comply with the port's environmental requirements. Cargo temperature/storage conditions if any remains and time. Under conditions outlined in the contract of carriage/affreightment/barebones or other

charter

Existing shipyards have constructed naval, port, fishing, recreation, supply vessels, rescue, research and other vessel types. South Africa’s maritime industry sector hosts significant existing skills and qualified companies, reinforcing its comparative competitive advantage and economic opportunities. For example, Durban’s 19 year old Marine and General provide customised manufacture and imports of components essential for the ship repair sector with 2000 m2 of workshops and 7,800m2 of warehousing. They can repair myriad structures, deck and vessel valves, pipes, systems, electrical, electronic and hydraulic parts along with supplying labour, chemicals, equipment, surveys and fuel blending. It also presents a minor boat building competitor for South African Shipyards in patrol/naval, support, fishing, inflatable, diving and survey, monohull and catamaran semi-rigid boats. A 10th June 2019, Department of Trade and Industry workshop attended by this report’s maritime economist specifically targeted localised component opportunities specifically for the shipbuilding and repair industry. Certain basic shipyard components essential to ship repair, the DTI is targeting to assist local dockyard capacity is summarised in table 3.3. This aimed to reduce the extent of exemptions for imports of maritime manufacturing/industry related products. Examples include pipes, safety and wielding equipment, valves, electrical cabling, marine windows, lighter weight piping, heating, ventilation and air-conditioning systems.

To qualify for state funding initiatives (as in Report 3), shipyards and other companies have to adhere to a minimum of 70% locally sourced components and up to 30% imported. It discovered that whilst many parts of the shipbuilding and repair supply chain could be locally produced; remaining sustainable and internationally cost competitive remained paramount given the noted

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size limitation of the South African local market. Shipyards and investors will be able to benefit from the Department of Trade and Industry’s developed database of marine industry suppliers. Certain manufactured goods would still need to consider specific marine classification, requiring a minimum examination of 15,000 euros every 1-5 years. Small and medium enterprises lack experience in project management and delivery, effective business plans, maritime stakeholder requirements and production economies of scale, high output blasting/washing/fabrication facilities. Government efforts to favour small and medium enterprises, whilst requiring state companies to primarily base procurement primarily on cost criteria; creates additional opportunity costs for ship repair/building facilities. This significantly adversely affects regional and global competitiveness as Table 3.4 highlights.

Table 3.3: Local Ship Repair Supply Chain Component Opportunities

Metal fabrication - (forming and joining of aluminium, mild and stainless steel/Titanium)

Power Distribution Systems-220 Volts Blasting Cable

Watertight doors Lightning Distribution Board UVG cableFluid storage tanks 24 Volt Direct Current Distribution

BoardLanding lightning cable

Valves Interior Push Button Box Multicore cableCompressors Exterior Push Button Box Copper conductorsAir accessories Switch socket and junction Pullkey cablesSolenoid valve for compressors Gooseneck Ventilator Specialised coating220-240 Volt Cables Mushroom Ventilator Sea water coatingMarine Navigation Lights Exhaust Nozzle Swing Check ValveBasic Design of Vessel Water mist system for engine Ball valveGarbage Compactor Control board and fire sensors Wafer Check valveVentilation Grid and cover General engineering Epoxy resinLED Searchlight Low instrumental cables MachineryMain Switchboard Optical Groundwire cables ComponentsSails Reverse Engineering services Low Voltage cablePower Distribution Systems - 440 Volts Refurbishment of valves, piping,

pumpsSignal cable

Source: Department of Trade and Industry 2019

South Africa does benefit from the presence of a specialised institute of naval architects and marine engineers (SAIMENA) including shipyards, vessel engineers, salvage and Navy. A scarcity of professional marine engineers and naval architects locally presents one existing challenge for South African Shipyards, Transnet and other ship repair facilities. Since 2014 one yet to be completed initiative was to establish local professional degrees at the University of Stellenbosch. Another challenge includes the limited sharing of experiences, technology transfer, research and innovation; given many companies remain concerned about commercially sensitive data and intellectual property rights; limiting spillover effects of increased awareness, collaboration and cooperation; as with other nation’s maritime education sectors and industrial clusters. One workshop proposed solution hinted at the possibility of at least one State Naval/other Design Centre -with experts and simulations/test facilities; but this would necessitate both industry and government support, given the expensive nature of simulator training.

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Table 3.4: Comparing Local Small and Medium Enterprise Shipyard Products Versus Global Market Averages.

Item Research + Development

Other Preparation Costs

Sample/ Prototype

Total (10 production units)

Global Average

Marine Navigation Lights

250,000 Included 1,700,000 3,450,000 98,465

Garbage Compactor Small Yacht

250,000 Included 17,500 438,000 125,000-350,000

Main Switchboard 440 V

250,000 Included 1,700,000 3,750,000 357,000

80 mm Ball Valve 5,000,000 Included 90,000 5,690,000 26,850

Source: Department of Trade and Industry 2019.

Internationally and within South Africa, efficient ship repair time, speed and labour costs are essential in influencing demand for floating and dry dock facilities. Significant opportunity and other costs exist when vessels are out of service, whether for emergency repairs, conversions or internationally mandatory 1-5 year servicing (Dev and Saha 2017). Few sources specifically investigate the efficiency of ship repair facilities that remain publicly available. Dev and Saha (2017) sourced ship repair time data for 600 cargo vessels and labour costs/time for 50. It identified ship repair and about time were predominantly influenced by ship’s age, deadweight, vessel characteristics and type of repair work. The most common services required were hull coating, piping, structural steel and tank coating. It estimated on average 60-70% of international average ship repair costs was based on labour costs not materials. Sufficient education, productivity, motivation, experience and equipment maintenance are paramount. It further contrasts with Durban, where port dues comprise the foremost component of ship repair costs in South Africa. Ship repair time in the study is scheduled from the vessel’s physical port arrival. It proposes a linear regression model capable of estimating an expected ship repairing labour in man hours can be estimated using age, size and quantity of repairing works as variables. Sample estimates are provided for various vessel types in Table 3.5. Figures 3.6-3.7 illustrate this graphically. Figures indicate that whilst ages vary from 8.53-13.8 year with a mean of 9.95 years; average deadweight tonnage varies substantially from 8,274 to 171,535. The higher these variables, the longer the related average repairing time ranging from 11.79 days to 23.25. Mean repair time was about 15.25 days. Internationally, shipping companies are also become more eco-conscious due to increasing consumer and legislative pressures, demanding dockyards are able to install scrubbers and convert vessels as an IMO convention by 2020. Scrubber costs include (40-50% commercial logistics and purchasing price, 10-15% engineering costs, (30-40% retrofit costs, possibly up to 10% financing costs and 10-15 loss of charter hire.

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Table 3.5: Average Vessel Characteristics and Related Scheduled Service Repairing Times

Types of Ships No of Ships Average Age Average Deadweight Average Repairing TimeGeneral Cargo 19 8.53 12,394 11.79Container 180 10.48 37,150 12.31Car/Ro-Ro 15 13.8 15,502 12.47Chemical/Product Tanker -Liquid Bulk

91 7.44 38,766 13.73

Dry Bulk 91 8.95 75,653 13.73Dredger 6 15.33 8,274 16.17Crude Oil Tanker 154 9.79 171,535 19.42LPG carrier 40 12.93 47,196 21.1LNG carrier 4 6.50 72,776 23.25Total 600 9.82 77,020 15.25

Source: Dev and Saha 2017.

Figure 3.6: Vessel Types Versus Average Vessel Size

General Cargo

Container

Car/Ro-R

o

Chemical/P

roduct Tanke

r -Liq

uid Bulk

Dry Bulk

Dredger

Crude Oil T

anker

LPG carri

er

LNG ca

rrier

Total0

20,00040,00060,00080,000

100,000120,000140,000160,000180,000200,000

Average Deadweight

Vessel Types

DEAD

WEI

GHT

TON

S

Source: This Study based on Dev and Saha 2017.

Figure 3.7: Vessel Types Versus Average Repairing Time

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General Cargo

Container

Car/Ro-Ro

Chemical/Product Tanker -Liquid Bulk

Dry Bulk

Dredger

Crude Oil Tanker

LPG carrier

LNG carrier

Total

0 5 10 15 20 25

Average Repairing Time Average Age

Source: This Study based on Dev and Saha 2017.

4.: SOUTH AFRICA DRYDOCK COMPETITOR PERFORMANCE AND EFFICIENCY ANALYSIS

Existing stakeholders have long recognised the expense and unavailability of land for dry dock alternatives in Southern African ports outside Richard’s Bay, along with supply insufficient to satisfactorily address demand. (K 2012) recognised poor maintenance of facilities including leading mules; safety parapet; rope handling furniture; warping vessel with capstan and bollard; electrical power supply source and blocks as a prime concern to resolve first. South Africa’s current competitive limits and experience, restrict market competition to vessels 140-155 metres long. As Report One outlined, South Africa is aiming to facilitate opportunities for its ship repair and building sectors, to contribute more to the economy, more modernised, productive and competitive under its marine transport and manufacturing. (South African Presidency 2017). The sector aims to increase from 6,000 current jobs and R7 billion contribution to GDP to 40,000-50,000 jobs and R14-23 billion by 2033. South Africa serviced only 4 out of 80 Africa-based oil rigs in 2012, contributing R1.2 billion to the local economy. Transnet aims to invest R2.7 billion into general ship repair facilities including slipways for minor vessels (Share 2017; Transnet 2017; TNPA 2018). Richard’s Bay’s floating dock is Initiative 7, while Transnet aims to attract an additional 12 offshore oil and gas vessels calling into Saldahna (TNPA 2018), supporting a projected 7,970 jobs, and upgrade East London’s slipway. A boat building cluster and training college is proposed for East London. Port Elizabeth are hosting a new 40 ton slipway and 90 ton boat hoist to increase projected capacity to repair 3-10 fishing trawlers each year. In Durban Transnet have invested R35 million in refurbishing its 93 year old Prince Edward Graving Dock with new equipment, expected to be completed by 2020. Durban are proposing a new Cruise Terminal to attract subsequent callers and Island View Liquid Bulk Terminal. Sturrock and Robinson Dock facilities are expected to be finalised by 2022. Transnet Durban’s unfinanced long-term plans indicate an additional drydock (330 metres by 50 metres);

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2 new floating docks, synchrolifts, oil repair rig and 240,000 m2 of container stacking area. Other ship repair industry pressure for smaller vessels has been applied by local businesses at Ngqura port.

A June 2019, Department of Trade and Industry workshop on South Africa’s boatbuilding and ship repair supply chain opportunities identified a decrease in imports for the industry in 2017 with R474 million from R700 million in 2015. From 2015-2017, exports remained stagnant around R2.7 billion, with a slight increase of R7 million in 2017. The most significant exports have been outboard motors, jackets and lifebelts, aside from a temporary R60 million increase in fishing nets based on plans for aquaculture under Operation Phakisa and the recapitalisation programme proposed for the fishing fleet. Since before 2013, marine diesel and semi-diesel engines remain the main import (200-400 million), followed by outboard motor and propellers. Opportunities may also potential exist for more eco-conscious shipping lines and increased International Maritime Organisation requirements for sulphur caps in fuel, scrubbers and conversion to Liquified Natural Gas.

Current South African maritime industry achievements for local shipyards have included 9 proposed Transnet tugs, 2 Port Nolloth offshore diamond mining vessels, a National Research Foundation Research vessel and South African navy workboat ferries (Molewa 2017). As a competitor analysis will subsequently highlight, neither South Africa nor sub-Saharan Africa currently possesses ship repair facilities capable of accommodating post-Panamax vessel types and sizes. Only Richard’s Bay, Saldanha and Durban ports offer sufficient physical capacity to accommodate the proposed floating dock as Table 4.1 highlights. Saldanha lacks sufficient market access and hinterland connectivity, whilst Durban port hosts significantly more complimentary marine industry activities and vessel callers to generate sufficient demand. (Zangwa 2018). A shipyard is expected to therefore benefit through its investigation into the market feasibility of a neo-Panamax floating dock.

4.1: Richard’s Bay Proposed Dock

This report significantly recommends that shipyards consider i Transnet’s decision to invest in an equivalent R1.4 billion floating dock for Richard’s Bay port, initially proposed in 2016 with 11 interested submission bids to construct. Transnet are aiming for utility service connections, mooring dolphins, landside area and revetment structure to absorb ocean energy at Richard’s Bay (Sivest 2018). Nemai Consulting (2018) have completed an initial environmental impact assessment report. Whilst Richard’s Bay offers certain space advantages, its proposed location at the existing small craft harbour (Figure 4.1) has potential to interfere with existing port user interests concerning marine recreation and tourism. It also has certain minor ecological impacts on existing benthic communities. No other site alternatives were considered. Berth deepening is being investigated to extend from a current 8.5 metres to 18 metres, to enable post-Panamax sized vessels. A maintenance dredging permit is needed under 2014 NEMA Regulations. Transnet have also proposed the concept of either operating the floating dock themselves or leasing it in a public-private partnership. They estimate the potential to serve Capesize vessels, create around 1,000 jobs and be operational by April 2022. Other economic motivation for the floating dock includes saving route and fuel costs, otherwise tugs and other vessels have to divert to Durban’s dock facilities; the political risk of not establishing the Operation Phakisa

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Initiative 7 and increasing demand for ship repair facilities. Dormac are only targeting smaller docks for the future in Saldanha and Walvis Bay. Their existing 8,500 ton floating composite dock and ferro-concrete bottom was imported from the Ukraine with advantages of minimal corrosion and frequency of dock inspections.

Figure 4.1: Existing Richard’s Bay Repair Quay and Proposed Future Capesize Dock

Source Sivest 2018.

Table 4.1: Existing South African Port Facilities

Port Terminal (No of) Berth (No of) Draft (m) Cargo TypeDurban 9 58 12.8 -18. Containers, cars, Dry bulk, break-

bulk, liquid, cruise, navy, fishingCape Town 7 34 15.9 Cruise, fishing, Container,

BreakbulkNgqura 4 4 10.4 Containers, Dry bulkEast London 4 12 14 Cars, BreakbulkPort Elizabeth 5 12 14.5 Cars, Containers, breakbulkSaldanha Bay 3 6 23.2 Dry bulk, Break bulkMossel Bay 2 8 7.5 Fishing, liquid bulkRichard’s Bay 6 23 22 Bulk, Breakbulk

Source TNPA (2018).

5: AFRICAN COMPETITOR PERFORMANCE AND EFFICIENCY ANALYSIS

In determining whether or not shipyards should invest in a neo-Panamax floating dock in; this market feasibility study emphasises the significant reputational and potential, competitive advantages of South Africa over its sub-Saharan African competitors. Price Waterhouse Coopers (2018) estimated an additional USS$ 2.2 billion contribution to Africa’s GDP, if existing

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congestion was curbed/throughput doubled (2018). A 25% in port performance is estimated to increase GDP by 2%, reduce import costs by US$ 3.2 billion and exports by 2.6 billion each year. One recent World Bank report analysed performance of Tema (Ghana), Lome (Togo), Dar es Salaam (Tanzania) and Durban (South Africa) as shown in Table 5.1 (Raballand et. al 2018). Average Dwell Time in Mombasa provided highest at 11 days but Durban was second highest. Factors which contributed to port congestion, included the fact that while Durban only allowed 3 days free time, Douala allowed 11 and Lome (21), providing a disincentive for rapid freight forwarding beyond the port. Raballand et. all (2018) recommended the following

1. Strengthen accountability by publishing information on efficiency indicators (such as those discussed above). An online performance monitoring tool will increase stakeholder engagement. By engaging more stakeholders in the conversation, problem areas can easily be identified and more viable and sustainable solutions can be found.

2. Cargos that have met all the items on the check list for clearing should not be allowed to stay within the ports. Defaulters must be charged higher penalties to discourage such practices.

3. The port authorities must seriously consider changing the berthing strategy to a more efficient one (like the fixed berthing window). Any identified challenges must be quickly addressed to meet this objective.

4. Regular expansion and upgrade of existing infrastructure will also be necessary to prevent breakdowns. This will help increase berth productivity and the ship turnaround time.

Table 5.1: Average Cargo Dwell Time in 2018 For 6 Leading African Ports

Port Average Dwell Time (days)Durban 14Douala 19Lome 18Tema 29Mombasa 11Dar es Salaam 14Average excluding Durban 16

Source Raballand et. al 2018.

An overview of the African ship repair industry shows a small developing industry where investment is concentrated on country specific local needs. There is a fairly stable overall dry-dock capacity however, there is a very low supply of floating docks – especially large Panamax size floating docks. The outlook for the African ship repair industry shows large market gaps and room for additional large-scale dry dock capacity. Ship repairs, dry-docking, repair work, repainting of vessels as well as a wide range of specialist services in Namibia are carried at the Walvis Bay Syncrolift which is owned, operated and maintained by Namport. The facility targets the fishing boats, the oil industry vessels as well as offshore supply boats. It is a firmly established as a regional hub for ship repair. South Africa’s neighbouring rival Namibia has successfully specialised in attracting offshore and fishing vessels, including diverting shipping to utilise Walvis Bay’s Synchrolift, as having higher perceived maintenance standards and more

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competitive than Cape Town, and lacking facilities at Saldanha. It contains a synchrolift up to 2,000 tons, 80 metre length and 14 metre width, hosting on average 50 smaller vessels per month. With no delays caused by weather conditions, turnaround times at the Port of Walvis Bay are very competitive: handling times for container vessels are around 12 to 15 hours; for bulk vessels averages between 24 and 48 hours depending on tonnage and shipment; and for break-bulk vessels it average between 18 to 20 hours.

In 2016 it attracted 475 vessels. In 2017, 475 vessels were serviced by repair facilities. 254 vessels were in repair jetties and 223 in repair bays. 5 floating repair jetties of 105 metres operated by Namport but around 80% is conducted by private companies, primarily Elgin, Brown and Hamar. Elgin, Brown and Hamar’s floating dock facilities are summarised in Table 5.2. Namport offers three floating docks (1 up to 15,000 megatons, 1 up to 8,000 and 1 up to 6,500 megatons (Namibia Port Authority 2017) with trained, experienced staff, 7 cranes, 1 60 ton floating crane and equipped repair workshops. It manages between 23-25 gross crane moves per hour. The Huascar oil tanker at 25,050 tons, length 176 metres and breadth 32.2 metres is the largest vessel repaired by existing facilities. It emphasises competitive advantages, particularly economic, social, political and labour stability, experience, safety and cost competitiveness in contrast to South Africa.

Table 5.2: Elgin, Brown and Hamar, Namibian Floating Dock Facilities

NAMDOCK 1 NAMDOCK 2 NAMDOCK 3 Width at Entrance 23.50m 23.50m 32.90m Width at EntranceWidth between inner walls 25.00m 25.00m 33.50m Width between inner wallsLength over keel blocks 139.50m 139.50m 195.00m Length over keel blocksVessel draft maximum 5.80m 7.20m 8.50m Vessel draft maximumLifting capacity 8,000Mt 6,500Mt 15,000Mt Lifting capacity NAMDOCK 1 NAMDOCK 2 NAMDOCK 3 Width at Entrance 23.50m 23.50m 32.90m Width at Entrance

Source: Elgin, Brown and Hamar 2019 website.

The following table summarises the main competitors on the African market.

Table 1: List of African Competitors

Yard Country City Dock Name

L (m) B (m)

D (m)

Repair

Floating Dock

Dry Dock

Taylor Smith & Co

Mauritius Port Louis 130 18 * *

Chantier Naval Mauritius Port Louis

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de l’Océan Indien Ltée

146 27 7 * *

SECREN Madagascar Antsiranana 199 26.4 8 * *Damen Djibouti Djibouti DMD

4020100 20 * *

SECO Kenya Mombasa * *Africa Marine & General Engineering (AMGECO)

Kenya Mombasa180 26.4 8 * *

Suez Odense Marine Service

Egypt Suez104 22 * *

Egyptian Ship Repair & Building Co. (ESRBC)

Egypt Alexandria167 26.8 * *

Suez Shipyard Co.

Egypt Suez 302 71 21.3 * *

Maputo Port Development Co. (MPDC)

Mozambique Maputo80 13 4 * *

Elgin Brown & Hamer

Namibia Walvis Bay Namdock 1

139.5 23.5 5.8 * *

Namdock 2

139.5 23.5 7.2 * *

Namdock 3

195 32.9 8.5 * *

Source: This Study, adapted from various sources.

5.1: East Africa Competitors

Mombasa has the biggest ship repair facilities in East and Central Africa after Durban in South Africa. The services are offered by private companies which include Southern Engineering Company (SECO) (Figure 5.2.) and African Marine & General Engineering Company (AMGECO). SECO offers a 66 metre drydock, 110 metre slipway, paint, steel fabrication, crane, rigging and mechanical workshop facilities plus 250 ton lifting capacity cranes. It offers capacity to repair navigational, electronic, control and air-conditioning facilities in addition to waste disposal, engines and vessel upgrades with 24/7 hour service and well-established supply chain contacts for procurement. AMGECO offers a 180 metre private drydock with 20,000 ton maximum vessel capacity and 24.5 metre width and 40 metre building dock, repair berths, tow slipways, workshops and a certified life raft station. Kenya is regarded as the regional hub for trade and finance in East Africa. It is the ideal point for vessels travelling between Europe, the Cape, India and Far East for docking. In addition to general facilities associated with any port, the port of Mombasa also provides for the repairs of vessels. It has one of the largest dry-dock facilities along the East African Coastline and offers comprehensive ship repair services. The dry-dock is operated by African Marine and General Engineering Company Limited (AMGECO) and can accommodate vessels up to 20,000 tons. The availability of a separate construction dock apart from its dry dock used for repair makes it even more convenient for shipbuilding.

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Mozambique has six ports on its coastline, namely, Beira, Inhambane, Maputo, Nacala, Pemba and Quelimane. Limited ship repairs are carried in Mozambique and these are restricted to the two primary ports in Mozambique with limited repairs carried out at the port of Nacala, while major and minor repairs are available in the Port of Maputo.

Figure 5.2.: SECO Ship Repair Facilities, Mombasa

Source: SECO 2019 website.

Looking at specific yards within the African market, there are presently only two dry docking shipyards at Port Louis in Mauritius, namely Taylor Smith & Co Ltd, which was established in 1857 and the Chantier Naval de l’Océan Indien Ltée (CNOI), established in 2003. Taylor Smith & Co. Ltd is the pioneer company in ship repairs. It has two dry docks which can accommodate vessels of up to 100 metres long together with a slipway of 30 metres long, at Terminal I. Chantier Naval de l’Océan Indien Ltée’s dry dock facility is 146 metres long and 27 metres wide with a dredged depth of 7 metres located at Terminal ll. Land availability around the port area is the main growth constraint particularly given the increasing number of vessels calling at Port Louis. Mauritius Port Authority is identifying land for ship repairs in the port area and intends to earmark additional areas of land to be reclaimed at Fort William for the setting up of ship repair yards to accommodate large vessels. Mauritius’s port entrance is restricted to vessels of 12,000 TEU’s and 15.5 metre depth (Mauritius Port Authority 2017), with dredging plans of 16.5 metres. However, it lacks suitable repair facilities, despite hosting 4,431 vessel calls including 42 cruise ships. In 2015 it attracted 59 vessels needing repairs. This increased to 107 vessels from 2016-2017. Average berth occupancy rate increased fractionally from 72.3 to 73.9; average moves per ship working hour expanded from 33.9 to 38.5.

Douala port includes a target of 24-48 hours in vessel berthing and container discharge, 1 hour transfer, 2 hour truck delivery and 1-8 hours exist from the yard (Raballand et. al 2018). It offers an 88% container yard and 60% berth occupancy rate. Tema’s port is restricted to vessel dimensions of 246 metre length and 11.5 metre width. Average berth waiting time decreased from 3.5 days to 2.25 over 2013-2016. Berth productivity increased from 102 to 130 tons per hour between 2010-2016. Gross crane moves per hour are only 19-21 moves per hour. In Dar es Salaam, vessels waited up to 10 days before entering, raising container import costs by 22% and dry bulk by 5% (Dar es Salaam Port Authority 2016). Dyer (2015) further emphasised how

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efficient Durban’s port remained compared to Mombasa, as its main African competitor as Table 2.16 illustrates. Mombasa port only attains 10-12 containers per gross crane hour and 12-13 per net crane hour, with modern yet insufficient equipment. Average Container berth occupancy decreased slightly from 94.5% to 91.4%. Average container berth occupancy fractionally declined from 63.9 to 63.5%. It offers 80-90% berth occupancy yet reduced its ship turnaround time in 2014 from an average of 5 to 3 days, aided by a port community charter and introducing a vessel window booking system; contrasting with Tema port’s first come, first serve open approach. Average berth waiting time decreased from 41 to 13 hours. Although tons per gang hour only increased by 7.5% from 2010 to 2016, labour wages became far less competitive with an 88% increase. Total vessel calls only increased from 1684 to 1,694 from 2010-2015 (Kenya Port Authority 2015).

Table 5.3: Comparing Durban to Mombasa’s Port Performance 2013 Average

Port Performance Measure Durban MombasaCargo Throughput (Tonnes) 87,711,170 22,310,000Container Throughput (TEU) 3,3000,000 894,000 Number of Motor Vehicles Discharged 437,263 136,915No of vessel calls 4172 1332Average Port Time for Ship 4 days 5 daysAverage Container Dwell time 3-4 4 daysAverage Transhipment Dwell Time 4 6Average Customs Clearing/ Dwell Time 4 5Average Ship Waiting Time for Berths 46 hours 2.78 daysBerth Occupancy Rate %: General cargo 43.8 61.4 Container Terminal 1 85 82.7 Main Oil Terminal NA 77.5 – Shimanzi

83.5 -KipevuGross Crane moves per hour 28 Pier 2 18Total cost to port users per year $250,000* $1,960,000**

Source: Dyer 2015

5.2: Other African Potential Competitor Dock Facilities

Egyptian facilities which attract vessels transiting the Suez Canal boasts one of the largest floating docks in the world and is currently a leader on the African market in terms of size and capacity.Egypt’s Hefni Shipyard offers specialised capacity to host up to 30 yachts simultaneously. Its qualified staff include professional naval architects and engineers, fire-fighting, fibre glass water jet and compressed air/ventilation systems. Yacht owners gain Internet password protected access to monitor progress on repairs, security, meeting and surveillance systems. Doula port in Cameroun is limited to 10,000 ton vessels and below for its drydock. Tema Shipyard in Ghana consists of 48.45 acres of land with 1 potential drydock competitor (277.4 metres by 45.7 by 6.7 metres summarised in Table 2.17 with repair berth, 200 m2 quay, 2 250 and one 350 ton slipway and workshop facilities. Takoradi port’s drydock is restricted to a 45 by 10.5 by 3 metre vessel, certified to ISO 9001 standards. It offers steel, aluminium, paint, sand blasting and basic

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mechanical, electrical, hydraulic and propulsion repair services, secured a separate substation. It possesses a self-propelled aerial work platform, fifteen 15 ton cranes and five 5 ton forklifts.

Table 5.4: Tema Shipyard, Ghana Repair Facilities

Description Dry Dock 1 Dry Dock 2 Length 277.4m 106.7m

Width 45.7m 13.7m

Draught 6.7 5.5m

DWT 100,000 100,000

6: INTERNATIONAL COMPETITOR PERFORMANCE AND EFFICIENCY ANALYSIS

To ensure local shipyards remain globally competitive and relevant, this section analyses an overview of existing global ship market developments and facilities. The extent of international floating and dry-dock demand is primarily influenced by factors such as the facilities provided, trade routes, reputation, competitiveness, customer service, costs and exchange rate. These specifically include labour, steel, spare parts and paint/coating costs for most related risk events. International steel costs have declined, labour is highly competitive and consistent. Increasing pressure exists for vessels to become more eco-sustainable. Table 6.1 identifies how very few African and Southern Hemisphere competitors exist for SAS, with many situated in Asia, the Middle East and Europe. Only 1 exists in Australia and 4 in South America, each with limits. China, Singapore and the Middle East dominate the VLCC, VLOC, Cape/Suezmax range of ship repair facilities. Figure 6.1 further emphasises the comparative scarcity of ship repair facilities exist to accommodate increasing vessel sizes, dimensions and changes in technology. Facilities in the Americas are mostly constrained in physical vessel dimensions as Table 6.2 identifies.

Figure 6.1: Geographical Distribution of the World’s Top Dock Competitor Facilities

Source: Drewry Marine Research 2018

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Table 6.1: Global Neo-Panamax Dry Dock Competitor Facility By Vessel Type

Region VLCC/VLOC >200,000 DWT

Cape/Suezmax120-2000,000 dwt

Total (of These)

China 21 15 36Singapore 9 5 14Middle East 9 0 9India 1 0 1Other Far East 10 6 16Turkey 2 1 3Black Sea/Balkans 3 4 7Mediterranean Europe/ North Africa 6 5 11Iberia 6 0 6NW Europe/Baltic 8 10 18Other Africa 0 1 1North America/Caribbean 2 7 9South America 4 0 4Australasia 0 1 1Total 81 55 136

Source: Drewry Marine Research 2018

Table 6.2: The Caribbean and America’s Top 10 Potential Dry Dock Competitors

Region Location Length Beam DepthSouth America Rio de Janeiro, Brazil 400 73 12Central America Panama 318 39 8Caribbean Freeport, Bahamas 300 54 10USA Newport News, Virginia 662 76 9

Roslindale, Maryland 366 61 8.5Boston, Massachusetts 350 38 12Brooklyn, New York 333 46 11Bayonne, New Jersey 333 45 11Norfolk, Virginia 300 50 12Philadelphia 300 34 10.7

Source: Drewry Maritime Research 2018

A Caribbean proposal exists to produce 2 400 metre and 1 500 metre vessel drydock facilities. However, the Americas are generally not favoured internationally due to high labour costs.

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Internationally, local shipyards will have to consider rivals such as the 2018 launch of Damen Shipyards’ 230 metre by 45 metre Panamax dock in Curacao and Curacao’s 280 metre by 45 metre facility specialising in cruise ship plus vessels up to 150,000 GRT. Drydocks take 32 hours to prepare for vessels greater than 200,000 DWT, 24 for 100-200,000 DWT and 8-15 for those smaller. One study on the decline of Brazil’s shipbuilding sector attributed it to overreliance on imported components; challenges to human resources, issues of finance, insufficient automation, experience and sustainably generated domestic demand (Weiss 2018). These shipyards sufficiently failed to invest in adequate research and development, incorporating the latest technology and other improvements in production processes. They failed to utilise existing higher educational facilities, consult core user stakeholders and share information. Lessons for emerging shipyards, public and private plus investors could also note that Brazilian state shipyards failed from over-centralised structures and bureaucracy. Their advantage over Transnet is less bureaucratic procedures in which procurement is not centralised as a government entity, complying with such as the 2005 Public Finance Management Act. Brazilian markets were also primarily limited to state orders and offshore oil vessels, whereas Durban port and South Africa host myriad diverse vessel types and markets. Brazil also lacked local suppliers of ship repair and building components. A national manufactured part was estimated as costing around 34.2% more on average than a local import. International dock facilities are provided in Table 6.3 to re-iterate South African Shipyards faces significant pressure to consider the most optimal size and configuration of facilities to remain not just domestically but internationally relevant but also competitive. The world’s largest docks are in Taiwan (950 by 92 metres by 14 metres) and St Nazaire, France (900 metres by 70) but 4 others exceed 600 metre lengths;12 exceed 500 metres; 23 exceed 400 metre lengths but many have berth configuration and port layout challenges inadequately preparing them for future generations of shipping technology innovations and vessel sizes.

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Table 6.3: Global Floating and Dry Dock Top Competitors to South African Shipyards’ Proposed neo-Panamax Dock

Yard Country City Dock name L (m) B (m) D (m) Repair Floating dock

Kuzey Star Shipyard Turkey Tuzla, Istanbul Floating dock 1 200.00 32.40 *

Kuzey Star Shipyard Turkey Tuzla, Istanbul Floating dock 2 230.00 37.00 *

Namdock 1 Namibia Walvis Bay, Namibia Namdock 1 139.50 25.00



CIC-Shipyards (CIC) China Changxing, Shanghai CS Putuoshan 247 36.6 8.5

CS Jiuhuashan 308 50.0 17.5

CS E’meishan 410 72.0 18.5

Lixin CS Huashan 164 27.4

CS Huangshan 190 28.4

CS Pudong 222.5 38

CS Feilongshan 245 36.0

COSCO Shipyard Group(COSCO)

China Dalian Dalian 350 66.0 27.0

Yuanyang No.1 260 48.5 22.5

Yuanyang No.1 240 40.0 11.8

Nantong Nantong 270 48.0 9.5

Yuantong 230 42.0 8.0

Shanghai 195 35.0 12.8

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https://en.wikipedia.org/wiki/Shanghai

https://en.wikipedia.org/wiki/Nantong

https://en.wikipedia.org/wiki/Dalian

https://en.wikipedia.org/wiki/China

https://en.wikipedia.org/wiki/COSCO

https://en.wikipedia.org/w/index.php?title=COSCO_Shipyard_Group&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=COSCO_Shipyard_Group&action=edit&redlink=1

https://en.wikipedia.org/wiki/Lixin_County


https://en.wikipedia.org/wiki/Changxing_Island_(Shanghai)


https://en.wikipedia.org/w/index.php?title=China_Shipping_Industry&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=China_Shipping_Industry_(Shanghai_Pudong)&action=edit&redlink=1

https://en.wikipedia.org/wiki/Walvis_Bay

https://en.wikipedia.org/wiki/Namibia

https://en.wikipedia.org/wiki/Floating_dock_Muloobinba



https://en.wikipedia.org/w/index.php?title=Namdock_2&action=edit&redlink=1



https://en.wikipedia.org/w/index.php?title=Namdock_1&action=edit&redlink=1

https://en.wikipedia.org/wiki/Tuzla,_Istanbul

https://en.wikipedia.org/wiki/Turkey

https://en.wikipedia.org/w/index.php?title=Kuzey_Star_Shipyard&action=edit&redlink=1

https://en.wikipedia.org/wiki/Tuzla,_Istanbul


https://en.wikipedia.org/w/index.php?title=Kuzey_Star_Shipyard&action=edit&redlink=1



Zhoushan No.1 280 40.0 12.9 * *

No.2 410 68.0 14.3 * *

No.3 539 49.2 11.3 * *

Guangdong Cui Huashan 238 40.0 16.0

Yuan Yang No.2 269 52.0 18.0

Lianyungang Zhongyuan Sheshan 240 37.0 12.8 *

Guangzhou Yuan Yang No.2 200 40.0 6.5 *

Cui Hua Shan 239 40.0 6.5 *

Nantong COSCO KHI Ship Engineering(COSCO and KHI)

China Nantong 230 42.0 8.0 * *

270 48.0 9.5

Shanghai Ship repair Centre China Shanghai 262 44.0

232 40.0 11.3

360 76.0

256 43.0

205 26.0

480 102.0

230 44.0 14.1

270 48.0 16.7

257 42.0 16.0

190 26.9 12.8

250 43.0 15.0

Hudong-Zhonghua Shipbuilding (CSSC)

China Shanghai 380 92.0 *

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https://en.wikipedia.org/wiki/China_State_Shipbuilding_Corporation

https://en.wikipedia.org/wiki/Hudong-Zhonghua_Shipbuilding

https://en.wikipedia.org/wiki/Hudong-Zhonghua_Shipbuilding



https://en.wikipedia.org/w/index.php?title=Shanghai_Shiprepair_Centre&action=edit&redlink=1

https://en.wikipedia.org/wiki/Nantong


https://en.wikipedia.org/wiki/Kawasaki_Heavy_Industries

https://en.wikipedia.org/wiki/COSCO

https://en.wikipedia.org/w/index.php?title=Nantong_COSCO_KHI_Ship_Engineering&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Nantong_COSCO_KHI_Ship_Engineering&action=edit&redlink=1

https://en.wikipedia.org/wiki/Guangzhou

https://en.wikipedia.org/wiki/Lianyungang

https://en.wikipedia.org/wiki/Guangdong

https://en.wikipedia.org/wiki/Zhoushan



Shanghai Shipyard(CSSC) China Shanghai Dry Dock 2# 262 44.0 10.9 * *

Dry Dock 2# 205 36.0 10.4

Bai Yun Shang 190 26.9 13.0

Xin Xiang Shen 245 39.4 15.3

Hai Hua 192 29.0 14.4

Shanghai Waigaoqiao Shipyard (CSSC)

China Shanghai 480 106.0

360 76.0

Chongming (Shanghai Jiangnan-Changxing Shipbuilding)

510 106.0

520 76.0

Dalian Shipbuilding Industry Company (CSIC)

China Dalian 400 96.0 13.0 * *

135 15.6

550 80.0

165 25.0

150 68.0

304 52.0

Shanhaiguan Shipbuilding Industry(CSIC)

China Qinhuangdao Dock No. 1 170 28.0 9.8 * *

Dock No. 2 240 28.0 11.4 * *

Dock No. 3 340 64.0 12.8 * *

Qingdao Beihai Shipbuilding Heavy Industry

China Qingdao 480 96.0 14.1 * *

530 121.0 13.1 * *

360 78.0 13.1 * *

325 58.0 13.1 * *

250 45.0 * *

59 | P a g e

https://en.wikipedia.org/wiki/Qingdao


https://en.wikipedia.org/w/index.php?title=Qingdao_Beihai_Shipbuilding_Heavy_Industry&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Qingdao_Beihai_Shipbuilding_Heavy_Industry&action=edit&redlink=1

https://en.wikipedia.org/wiki/Qinhuangdao


https://en.wikipedia.org/wiki/China_Shipbuilding_Industry_Corporation

https://en.wikipedia.org/w/index.php?title=Shanhaiguan_Shipbuilding_Industry&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Shanhaiguan_Shipbuilding_Industry&action=edit&redlink=1



https://en.wikipedia.org/wiki/China_Shipbuilding_Industry_Corporation

https://en.wikipedia.org/wiki/Dalian_Shipbuilding_Industry_Company

https://en.wikipedia.org/wiki/Dalian_Shipbuilding_Industry_Company

https://en.wikipedia.org/wiki/Chongming_County



https://en.wikipedia.org/w/index.php?title=Shanghai_Waigaoqiao_Shipyard&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Shanghai_Waigaoqiao_Shipyard&action=edit&redlink=1




https://en.wikipedia.org/w/index.php?title=Shanghai_Shipyard&action=edit&redlink=1



Yantai Raffles Shipyard China Yantai 430 120.0 12.0 * *

205 45.0 8.0

Yiu Lian Dockyards(China Merchants Holdings)

China Shekou No.1 400 83 8 *

No.2 360 67 8.5 *

No.3 240.5 36 6 *

No.4 190 27.8 6 *

No.3 (Hongkong) 305 45.8 15 *

Mumbai Port Trust India Mumbai Hughes Dry Dock 304 30.5 12.0 *

Merewether Dry Dock 152 18.3 8.7 *

Pipavav Shipyard India Port Pipavav 662 65.0

IHI Japan Chita (Aichi Shipyard) 350 90.0 7.2 *

Aioi (IHI Amtec) No. 1 225 32.2 6.5

No. 3 325 54.5 6.5

Yokohama (IHI Marine United) 340 53.7 6.0

Sagami 240 40.0 6.2

Negishi 175 33.0 7.2

Showa-cho, Hiroshima(IHI Marine United) 300 40.0 9.0

Kitahama-Machi (IHI Corporation) 340 56.0 6.5

Imabari Shipbuilding Japan Koura-cho (Imabari Shipyard) No.2 Dry Dock 211 43.0 *

Marugame No.1 drydock 270 45.0 *

No.2 drydock 370 57.0 *

60 | P a g e

https://en.wikipedia.org/wiki/Marugame

https://en.wikipedia.org/w/index.php?title=Koura-cho&action=edit&redlink=1

https://en.wikipedia.org/wiki/Japan

https://en.wikipedia.org/wiki/Imabari_Shipbuilding

https://en.wikipedia.org/w/index.php?title=Kitahama-Machi&action=edit&redlink=1

https://en.wikipedia.org/wiki/Hiroshima

https://en.wikipedia.org/w/index.php?title=Showa-cho&action=edit&redlink=1

https://en.wikipedia.org/wiki/Yokohama

https://en.wikipedia.org/wiki/Aioi,_Hy%C5%8Dgo

https://en.wikipedia.org/wiki/Chita,_Aichi


https://en.wikipedia.org/wiki/IHI_Corporation

https://en.wikipedia.org/wiki/Port_Pipavav

https://en.wikipedia.org/wiki/India

https://en.wikipedia.org/wiki/Pipavav_Shipyard

https://en.wikipedia.org/wiki/Bombay

https://en.wikipedia.org/wiki/India

https://en.wikipedia.org/wiki/Mumbai_Port_Trust

https://en.wikipedia.org/wiki/Hongkong

https://en.wikipedia.org/wiki/Shekou_Industrial_Zone


https://en.wikipedia.org/wiki/China_Merchants_Holdings_(International)

https://en.wikipedia.org/wiki/China_Merchants_Holdings_(International)

https://en.wikipedia.org/w/index.php?title=Yiu_Lian_Dockyards&action=edit&redlink=1

https://en.wikipedia.org/wiki/Yantai


https://en.wikipedia.org/wiki/Yantai_Raffles_Shipyard



Saijo 420 89.0 *

Mihara (Koyo Dockyard) No.1 Building Dock 378 59.0 *

No.1 Dry Dock 250 38.0 *

No.2 Dry Dock 300 45.0 *

No.5 Dry Dock 350 56.0 * *

Iwagi (Iwagi Zosen) No.1 Dry Dock 215 38.6 *

Ikata Kou (Shimanami Shipyard) Slipway 200 34.0 *

Kasadoshima (Shin Kasado Dockyard)

No.1 Dry Dock 154 21.2 *

No.2 Dry Dock 227 37.0 *

No.3 Dry Dock 255 50.0 *

Honjo (I-S Shipyard) 178 30.0 *

250 43.2

215 33.5

281 46.4

Sakaide 380 62.0

450 72.0

420 75.0

Mitsubishi Heavy Industries Japan Akunoura-machi(Nagasaki) No. 1 375 56.0 14.0 *

No. 2 350 56.0 14.0 *

61 | P a g e

https://en.wikipedia.org/wiki/Nagasaki

https://en.wikipedia.org/w/index.php?title=Akunoura-machi&action=edit&redlink=1


https://en.wikipedia.org/wiki/Mitsubishi_Heavy_Industries

https://en.wikipedia.org/wiki/Sakaide

https://en.wikipedia.org/wiki/Honj%C5%8D,_Akita

https://en.wikipedia.org/w/index.php?title=Kasadoshima&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Ikata_Kou&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Iwagi&action=edit&redlink=1

https://en.wikipedia.org/wiki/Mihara,_Hiroshima

https://en.wikipedia.org/wiki/Saij%C5%8D,_Ehime



No. 3 277 38.8 12.3 *

Koyagi (Nagasaki) Building 990 100.0 14.5 *

Repair 400 100.0 14.5 *

Shimonoseki (Enoura, Hiroshima) No. 1 164 23.8 9.5

No. 2 217 32.0 10.0

Nishikicho (Honmoku, Yokohama) No.1 Dry Dock 350 60.0 8.8

No.2 Dry Dock 270 60.0 9.8

No.3 Dry Dock 180 30.0 10.7

No. 2 209 33.6 14.5

No. 4 302 43.7 9.5

Mitsui Engineering and Shipbuilding

Japan Tamano (Okayama) 216 30.3

195 81.0

Chiba 310 45.0 10.5

400 72.0 12.5

219 72.0 12.5

Yura (Wakayama) 350 65.0 14.3

Universal Shipbuilding Corporation

Japan Arao (Ariake Shipyard) Dock No. 1 620 85.0 14.0 *

Dock No. 2 420 85.0 14.0 *

Tsu (Toyota, Tsu Shipyard) Dock No. 1 500 75.0 11.8 *

Dock No. 2 500 75.0 14.1 *

Maizuru Shipyard Dock No. 1 172 36.0 *

Dock No. 2 258 36.4 12.7 *

Dock No. 3 246 33.5 *

62 | P a g e

https://en.wikipedia.org/wiki/Maizuru

https://en.wikipedia.org/wiki/Toyota

https://en.wikipedia.org/wiki/Tsu,_Mie

https://en.wikipedia.org/wiki/Arao


https://en.wikipedia.org/wiki/Universal_Shipbuilding_Corporation

https://en.wikipedia.org/wiki/Universal_Shipbuilding_Corporation

https://en.wikipedia.org/w/index.php?title=Yura_(Wakayama)&action=edit&redlink=1

https://en.wikipedia.org/wiki/Chiba,_Chiba

https://en.wikipedia.org/w/index.php?title=Tamano_(Okayama)&action=edit&redlink=1


https://en.wikipedia.org/wiki/Mitsui_Engineering_and_Shipbuilding

https://en.wikipedia.org/wiki/Mitsui_Engineering_and_Shipbuilding

https://en.wikipedia.org/wiki/Yokohama

https://en.wikipedia.org/wiki/Nishikicho

https://en.wikipedia.org/wiki/Hiroshima

https://en.wikipedia.org/wiki/Shimonoseki

https://en.wikipedia.org/wiki/Nagasaki

https://en.wikipedia.org/w/index.php?title=Koyagi&action=edit&redlink=1



Dock No. 1 175 35.0 *

Dock No. 2 283 46.5 *

Innoshima Shipyard Dock No. 1 175 25.1 6.6

Dock No. 2 283 46.6 8.9

Dock No. 3 260 56.8 8.5 *

Sanoyas Hishino Meisho Japan Kojima (Okayama)(Mizushima) 675 63.0 12.5 * *

Osaka Dry dock No.1 153 21.4 7.4 *

Sasebo Heavy Industries Japan Sasebo (Nagasaki) 1 154 26.5 12.9 *

2 223 32.5 14.4 *

3 370 70.0 14.3 *

4 400 57.0 15.6 *

5 174 30.3 11.8 *

6 180 29.3 12.9 *

No 3 227 37.0 6.8 *

No 5 244 44.8 6.4 *

Tsuneishi Shipbuilding Japan Tsuneishi Construction Dock 266 46.0 9.0 *

Dock 1 250 49.5 8.1 *

Dock 10 160 35.6 6.3 *

Dock 11 150 31.7 6.3 *

Dock 12 330 54.5 7.8 *

Tadotsu Construction Dock 380 59.0 7.9 * *

Philippines Balamban, Cebu 128 23.3 *

Construction Dock 450 60.0 *

63 | P a g e

https://en.wikipedia.org/wiki/Cebu

https://en.wikipedia.org/wiki/Balamban

https://en.wikipedia.org/wiki/Philippines

https://en.wikipedia.org/wiki/Tadotsu

https://en.wikipedia.org/w/index.php?title=Tsuneishi&action=edit&redlink=1


https://en.wikipedia.org/w/index.php?title=Tsuneishi_Shipbuilding&action=edit&redlink=1

https://en.wikipedia.org/wiki/Sasebo_(Nagasaki)


https://en.wikipedia.org/w/index.php?title=Sasebo_Heavy_Industries&action=edit&redlink=1

https://en.wikipedia.org/wiki/Osaka

https://en.wikipedia.org/w/index.php?title=Kojima_(Okayama)&action=edit&redlink=1


https://en.wikipedia.org/wiki/Sanoyas_Hishino_Meisho

https://en.wikipedia.org/wiki/Innoshima



PT PAL Indonesia (Persero) Indonesia Soerabaja 300 32.0 10.3

250 26.0 14.0

128 20.3 6.0

Malaysia Marine & Heavy Engineering

Malaysia Johor 385 80.0 14.0

270 46.0 12.5

Jurong Shipyard(Sembcorp) Singapore Jurong West DD 1 270 40.0 10.0 * *

DD 2 350 56.0 12.0 * *

DD 3 380 80.2 14.0 * *

DD 5 335 56.0 11.0 * *

Keppel Shipyard Singapore Tuas Tuas Dock 350 66.0

Raffles Dock 355 60.0

Temasek Dock 301 52.0

Benoi No. 1 drydock 350 60.0

No. 2 drydock 300 60.0

Gul Floating Dock No. 1 190 33.0

Floating Dock No. 2 120 27.0


Sembawang Shipyard(Sembcorp)

Singapore Woodlands Premier 384 64.0 8.5

President 290 48.0 8.5

King George VI (KGVI)

303 39.6 13.1

Republic 202 42.0 10.3

64 | P a g e

https://en.wikipedia.org/wiki/Woodlands_(Singapore)

https://en.wikipedia.org/wiki/Singapore

https://en.wikipedia.org/w/index.php?title=Sembawang_Shipyard&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Sembawang_Shipyard&action=edit&redlink=1

https://en.wikipedia.org/wiki/Gul_Circle

https://en.wikipedia.org/wiki/Benoi

https://en.wikipedia.org/wiki/Tuas


https://en.wikipedia.org/wiki/Keppel_Shipyard

https://en.wikipedia.org/wiki/Jurong_West


https://en.wikipedia.org/wiki/Sembcorp

https://en.wikipedia.org/w/index.php?title=Jurong_Shipyard&action=edit&redlink=1

https://en.wikipedia.org/wiki/Johor

https://en.wikipedia.org/wiki/Malaysia

https://en.wikipedia.org/w/index.php?title=Malaysia_Marine_%26_Heavy_Engineering&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Malaysia_Marine_%26_Heavy_Engineering&action=edit&redlink=1

https://en.wikipedia.org/wiki/Soerabaja

https://en.wikipedia.org/wiki/Indonesia

https://en.wikipedia.org/w/index.php?title=PT_PAL_Indonesia_(Persero)&action=edit&redlink=1



KFD 230 35.0 7.3

CSBC Corporation, Taiwan Taiwan Kaohsiung 950 92.0 14.0 * *

275 45.0 12.0 * *

Keelung 275 45.0 10.2 * *

210 26.4 12.4 * *

270 45.0 11.5 * *

Dubai Drydocks United Arab Emirates

Dubai (Port Rashid) Dock No.2 521 100.0 12.0

* *

Dock No.3 411 80.0 12.0

Dock No.1 366 66.0 12.0

Floating Dock 205 32.0

Hyundai-Vinashin Shipyard Vietnam Ninh Phuoc No. 1 Dock 260 45.0 13.0

No. 2 Dock 380 65.0 13.0

STX Offshore & Shipbuilding South Korea

Jinhae Building Dock No. 1 385 74.0


China Dalian No. 1 430 135.0

Daewoo Shipbuilding & Marine Engineering

South Korea

Okpo, Geoje No.1 530 131.0 14.5

No.2 539 81.0 14.5

F.D No.1 298 51.5 20.3

F.D No.2 238 38.8 26.9

F.D No.3 362 62.0 21.0

Daedong Shipbuilding South Korea

Chinhae 320 74.0 11.0

Samsung Heavy Industries South Korea

Geoje Dock No. 1 283 46.0 11.0 *

Dock No. 2 390 65.0 11.0 *

65 | P a g e

https://en.wikipedia.org/wiki/Geoje

https://en.wikipedia.org/wiki/South_Korea


https://en.wikipedia.org/wiki/Samsung_Heavy_Industries

https://en.wikipedia.org/wiki/Chinhae



https://en.wikipedia.org/w/index.php?title=Daedong_Shipbuilding&action=edit&redlink=1

https://en.wikipedia.org/wiki/Geoje

https://en.wikipedia.org/wiki/Okpo-dong



https://en.wikipedia.org/wiki/Daewoo_Shipbuilding_%26_Marine_Engineering

https://en.wikipedia.org/wiki/Daewoo_Shipbuilding_%26_Marine_Engineering



https://en.wikipedia.org/wiki/Jinhae



https://en.wikipedia.org/wiki/STX_Offshore_%26_Shipbuilding

https://en.wikipedia.org/wiki/Ninh_Phuoc

https://en.wikipedia.org/wiki/Vietnam

https://en.wikipedia.org/w/index.php?title=Hyundai-Vinashin_Shipyard&action=edit&redlink=1

https://en.wikipedia.org/wiki/Port_Rashid

https://en.wikipedia.org/wiki/Dubai

https://en.wikipedia.org/wiki/United_Arab_Emirates

https://en.wikipedia.org/wiki/United_Arab_Emirates

https://en.wikipedia.org/wiki/Dubai_Drydocks

https://en.wikipedia.org/w/index.php?title=Jil%C3%B3ng&action=edit&redlink=1

https://en.wikipedia.org/wiki/Kaohsiung

https://en.wikipedia.org/wiki/Taiwan

https://en.wikipedia.org/wiki/CSBC_Corporation,_Taiwan



Dock No. 3 640 97.5 12.7 *

G1 Dock 270 52.0 15.0 *

G2 Dock 400 55.0 15.0 *

G3 Dock 400 70.0 16.0 *

Hyundai Heavy Industries South Korea

Ulsan Dry Docks No. 1 390 80.0 12.7 *

Dry Docks No. 2 500 80.0 12.7 *

Dry Docks No. 3 672 92.0 13.4 *

Dry Docks No. 4 380 65.0 12.7 *

Dry Docks No. 5 380 65.0 12.0 *

Dry Docks No. 6 260 43.0 12.0 *

Dry Docks No. 7 170 25.0 11.0 *

Dry Docks No. 8 460 70.0 12.7 *

Dry Docks No. 9 460 70.0 12.7 *

Hyundai Mipo Dockyard South Korea

Ulsan No. 1 Dock 380 65.0 12.5 *

No. 2 Dock 380 65.0 12.5 *

No. 3 Dock 380 65.0 12.5 *

No. 4 Dock 300 76.0 12.5 *

Hyundai Samho Heavy Industries

South Korea

Samho-Eup No. 1 Dock 500 100.0 13.0 *

No. 2 Dock 594 104.0 13.0 *

66 | P a g e

https://en.wikipedia.org/w/index.php?title=Samho-Eup&action=edit&redlink=1



https://en.wikipedia.org/wiki/Hyundai_Samho_Heavy_Industries

https://en.wikipedia.org/wiki/Hyundai_Samho_Heavy_Industries

https://en.wikipedia.org/wiki/Ulsan



https://en.wikipedia.org/wiki/Hyundai_Mipo_Dockyard

https://en.wikipedia.org/wiki/Ulsan



https://en.wikipedia.org/wiki/Hyundai_Heavy_Industries



Floating Dock 337 70.0 24.0 *

Sungdong Shipbuilding & Marine Engineering

South Korea

Tongyeong Yard No. 1 230 55.0 22.7 *

Yard No. 2 320 67.0 23.0 *

Yard No. 3 545 126.0 16.0 *

Hanjin Heavy Industries and Construction

South Korea

Busan (Yeongdo) Dry Dock No. 2 233 35.0 9.0 *

Dry Dock No. 3 302 50.0 11.5 *

Dry Dock No. 4 302 50.0 11.5 *

Philippines Subic Bay Freeport Zone Dry Dock No. 5 370 100.0 12.5 *

Dry Dock No. 6 550 135.0 13.5 *

Thales Australia Australia Garden Island, Sydney Captain Cook graving dock 346 41.6 13.0 * *

National Ports Authority of South Africa

South Africa

Durban 352 33.5 12.6 *

Cape Town Sturrock Dry Dock 370 45.1 13.7 *

Robinson Dry Dock 161 20.7 7.9 *

South African Navy / Armscor South Africa

Simon's Town Selborne Graving Dock 231 36.58 13.7

Sermetal Estaleiros Brazil Rio de Janeiro Dry Dock 1 155 25.0 8.0

Dry Dock 2 350 65.0 10.0

Astilleros Braswell International

Panama Balboa Dock No. 1 318 33.6 7.9 *

Dock No. 2 130 25.9 6.4 *

Grand Bahama Shipyard Bahamas Freeport Drydock No.1 268 33.5 8.0 *

67 | P a g e

https://en.wikipedia.org/wiki/Freeport,_Bahamas

https://en.wikipedia.org/wiki/Bahamas

https://en.wikipedia.org/w/index.php?title=Grand_Bahama_Shipyard&action=edit&redlink=1

https://en.wikipedia.org/wiki/Balboa,_Panama

https://en.wikipedia.org/wiki/Panama

https://en.wikipedia.org/w/index.php?title=Astilleros_Braswell_International&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Astilleros_Braswell_International&action=edit&redlink=1

https://en.wikipedia.org/wiki/Rio_de_Janeiro

https://en.wikipedia.org/wiki/Brazil

https://en.wikipedia.org/w/index.php?title=Sermetal_Estaleiros&action=edit&redlink=1

https://en.wikipedia.org/wiki/Selborne_Graving_Dock

https://en.wikipedia.org/wiki/Selborne_Graving_Dock

https://en.wikipedia.org/wiki/Simon's_Town

https://en.wikipedia.org/wiki/South_Africa


https://en.wikipedia.org/wiki/Armscor_(South_Africa)

https://en.wikipedia.org/wiki/South_African_Navy

https://en.wikipedia.org/wiki/Cape_Town

https://en.wikipedia.org/wiki/Durban



https://en.wikipedia.org/w/index.php?title=National_Ports_Authority_of_South_Africa&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=National_Ports_Authority_of_South_Africa&action=edit&redlink=1

https://en.wikipedia.org/wiki/Sydney

https://en.wikipedia.org/wiki/Garden_Island_(New_South_Wales)

https://en.wikipedia.org/wiki/Australia

https://en.wikipedia.org/wiki/Thales_Australia

https://en.wikipedia.org/wiki/Subic_Bay_Freeport_Zone

https://en.wikipedia.org/wiki/Philippines

https://en.wikipedia.org/wiki/Yeongdo

https://en.wikipedia.org/wiki/Busan



https://en.wikipedia.org/wiki/Hanjin_Heavy_Industries_and_Construction

https://en.wikipedia.org/wiki/Hanjin_Heavy_Industries_and_Construction

https://en.wikipedia.org/wiki/Tongyeong



https://en.wikipedia.org/wiki/Sungdong_Shipbuilding_%26_Marine_Engineering

https://en.wikipedia.org/wiki/Sungdong_Shipbuilding_%26_Marine_Engineering



Drydock No.2 300 58.5 9.1 *

Drydock No.3 310 54.6 8.5 *

Public Services and Procurement Canada Canada Victoria Shipyards[46]

Esquimalt Graving Dock[47]

357 41 12 *

Washington Marine Group Canada Vancouver Vancouver Dry Dock[48] 220 45.8 8.8

Washington Marine Group Canada Vancouver Vancouver Shipyards[49] 131 33.5

Hawaii Shipyards (BAE Systems)

United States

Pearl Harbour (Hawaii) Graving dock No. 4 320 42.4 *

Devonport Naval Base New Zealand

Devonport (Auckland) Calliope Dry-Dock 181.4 24.3 8.0 *

National Steel and Shipbuilding Company(General Dynamics)

United States San Diego

305 53.0 9.1

250 41.4

Sparrows Point Shipyard Industrial Complex

United States

Baltimore 365 61.0 *

289 42.7 *

Bayonne Dry Dock

Brooklyn

United States

Bayonne 333 45.0 11.0 *

Brooklyn 333 46.0 11.0 *

Bay Shipbuilding Company (Fincantieri)

United States

Sturgeon Bay 352 42.7

183 21.3

Huntington Ingalls Industries United States

Newport News(Newport News Shipbuilding)

Dry Dock 12 662 76.0 9.5 * *

336 42.0 12.0 * *

293 38.0 9.0 * *

Dry Dock 2 262.8 35.4 9.5 * *

Dry Dock 1 198.2 28.0 8.5 * *

68 | P a g e

https://en.wikipedia.org/wiki/Newport_News_Shipbuilding

https://en.wikipedia.org/wiki/Newport_News_Shipbuilding

https://en.wikipedia.org/wiki/Newport_News

https://en.wikipedia.org/wiki/United_States_of_America


https://en.wikipedia.org/wiki/Huntington_Ingalls_Industries

https://en.wikipedia.org/wiki/Sturgeon_Bay,_Wisconsin



https://en.wikipedia.org/wiki/Fincantieri

https://en.wikipedia.org/wiki/Bay_Shipbuilding_Company

https://en.wikipedia.org/wiki/Bay_Shipbuilding_Company

https://en.wikipedia.org/wiki/Brooklyn

https://en.wikipedia.org/wiki/Bayonne,_New_Jersey



https://en.wikipedia.org/w/index.php?title=Bayonne_Dry-Dock_%26_Repair_Corp&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Bayonne_Dry-Dock_%26_Repair_Corp&action=edit&redlink=1

https://en.wikipedia.org/wiki/Baltimore



https://en.wikipedia.org/w/index.php?title=Sparrows_Point_Shipyard_Industrial_Complex&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Sparrows_Point_Shipyard_Industrial_Complex&action=edit&redlink=1

https://en.wikipedia.org/wiki/San_Diego



https://en.wikipedia.org/wiki/General_Dynamics

https://en.wikipedia.org/wiki/National_Steel_and_Shipbuilding_Company



https://en.wikipedia.org/wiki/Auckland

https://en.wikipedia.org/wiki/Devonport,_New_Zealand

https://en.wikipedia.org/wiki/New_Zealand

https://en.wikipedia.org/wiki/New_Zealand

https://en.wikipedia.org/wiki/Devonport_Naval_Base

https://en.wikipedia.org/wiki/Hawaii

https://en.wikipedia.org/wiki/Naval_Station_Pearl_Harbor



https://en.wikipedia.org/wiki/BAE_Systems

https://en.wikipedia.org/wiki/BAE_Systems

https://en.wikipedia.org/w/index.php?title=Hawaii_Shipyards&action=edit&redlink=1

https://en.wikipedia.org/wiki/List_of_dry_docks#cite_note-49

https://en.wikipedia.org/wiki/Vancouver


https://en.wikipedia.org/wiki/Vancouver





160 22.0 9.0 * *

182.9 42.7 11.6 * *

Pascagoula, (Ingalls Shipbuilding) 274 66.4 10.7 * *

200 35.0 8.5 * *

Aker Philadelphia Shipyard United States

Philadelphia 333 45.7 12.2

333 45.7 11.0

Northeast Ship Repair United States

Boston (Boston Ship Repair) 351 38.1 *

Philadelphia(Philadelphia Ship Repair) 300 34.8 *

Vigor Industrial United States

Seattle, Washington Evolution195 35.3 * *

Vigor Industrial United States

Portland, Oregon The Vigorous292.6 56.7 21.3 *

Antwerp Ship Repair(Damen) Belgium Antwerp 1 146 18.5 5.5 *

2 166 21.5 6.5 *

3 193 26.0 7.0 *

4 207 27.0 7.0 *

5 255 39.0 8.0 *

6 312 50.0 8.0 *

Odense Steel Shipyard Denmark Odense Dock No. I 300 45.0 7.5 * *

Dock No. II 300 45.0 7.5

Dock No. II 415 90.0 11.0

Blohm + Voss Repair (ThyssenKrupp Marine Systems)

Germany Hamburg 6 163 24.5 8.0 *

10 288 44.2 10.2 *

11 321 52.0 10.8 *

16 200 32.0 9.5 *

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https://en.wikipedia.org/wiki/Hamburg

https://en.wikipedia.org/wiki/Germany

https://en.wikipedia.org/wiki/ThyssenKrupp_Marine_Systems


https://en.wikipedia.org/wiki/Blohm_%2B_Voss

https://en.wikipedia.org/wiki/Odense

https://en.wikipedia.org/wiki/Denmark

https://en.wikipedia.org/wiki/Odense_Steel_Shipyard

https://en.wikipedia.org/wiki/Antwerp

https://en.wikipedia.org/wiki/Belgium

https://en.wikipedia.org/w/index.php?title=Damen_Shipyards_Group&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Antwerp_Ship_Repair&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=The_Vigorous&action=edit&redlink=1

https://en.wikipedia.org/wiki/Portland,_Oregon



https://en.wikipedia.org/wiki/Vigor_Industrial

https://en.wikipedia.org/wiki/Seattle



https://en.wikipedia.org/wiki/Vigor_Industrial

https://en.wikipedia.org/wiki/Philadelphia

https://en.wikipedia.org/wiki/Boston



https://en.wikipedia.org/w/index.php?title=Northeast_Ship_Repair&action=edit&redlink=1

https://en.wikipedia.org/wiki/Philadelphia



https://en.wikipedia.org/wiki/Aker_Philadelphia_Shipyard

https://en.wikipedia.org/wiki/Ingalls_Shipbuilding

https://en.wikipedia.org/wiki/Pascagoula



Elbe 17 351 59.2 9.5 *

Blohm + Voss Shipyards (ThyssenKrupp Marine Systems)

Germany Hamburg 5 160 28.0 8.0 *

12 143 25.0 8.0 *

Howaldtswerke-Deutsche Werft (ThyssenKrupp Marine Systems)

Germany Kiel 8a 426 88.2 8.7 *

8 231 44.0 5.3 *

7 310 50.3 5.3 *

6 201 26.6 9.3 *

5 228 26.6 9.6 *

Lloyd Werft Bremerhaven(Fincantieri)

Germany Bremerhaven Kaiserdock I 222 26.0 10.5 *

Kaiserdock II 335 35.0 11.5 *

Schwimmdock III 286 38.0 6.5 *

Schwimmdock "Rickmers Lloyd" 147 21.0 6.5 *

Meyer Werft Germany Papenburg 358 40.0 9.5 *

482 45.0 10.0 *

240 35.0 *

Suez Odense Marine Service Egypt Suez 144 22.0 *

302 56.5 *

Turku Repair Yard Finland Naantali (Turku) 265 70.0 7.9 *

Suomenlinna (Helsinki Repair Yard) 380 56.0 8.0 *

STX Europe Finland Turku 365 80.0 *

Helsinki 281 34.0 *

Rauma 260 85.0 *

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https://en.wikipedia.org/wiki/Rauma,_Finland

https://en.wikipedia.org/wiki/Helsinki

https://en.wikipedia.org/wiki/Turku

https://en.wikipedia.org/wiki/Finland

https://en.wikipedia.org/wiki/STX_Europe

https://en.wikipedia.org/wiki/Suomenlinna

https://en.wikipedia.org/wiki/Turku

https://en.wikipedia.org/wiki/Naantali

https://en.wikipedia.org/wiki/Finland

https://en.wikipedia.org/wiki/Turku_Repair_Yard

https://en.wikipedia.org/wiki/Suez

https://en.wikipedia.org/wiki/Egypt

https://en.wikipedia.org/w/index.php?title=Suez_Odense_Marine_Service&action=edit&redlink=1

https://en.wikipedia.org/wiki/Papenburg


https://en.wikipedia.org/wiki/Meyer_Werft

https://en.wikipedia.org/wiki/Bremerhaven



https://en.wikipedia.org/w/index.php?title=Lloyd_Werft_Bremerhaven&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Lloyd_Werft_Bremerhaven&action=edit&redlink=1

https://en.wikipedia.org/wiki/Kiel




https://en.wikipedia.org/wiki/Howaldtswerke-Deutsche_Werft

https://en.wikipedia.org/wiki/Howaldtswerke-Deutsche_Werft

https://en.wikipedia.org/wiki/Hamburg




https://en.wikipedia.org/wiki/Blohm_%2B_Voss

https://en.wikipedia.org/wiki/Elbe_17



France Saint-Nazaire(Chantiers de l'Atlantique)

900 70.0 *

450 90.0 * *

ARNO Dunkerque France Dunkerque 6 310 50.0 9.7 *

210 32.0 9.0 *

Port Autonome du Havre/ Soreni

France Le Havre

Formes de l'Eure

184 23.6 8.7 *

168 19.0 8.7 *

131 14.2 7.8 *

Dock Flottant 310 53.0 9.7 *

Forme VII 319 38.0 17.5 *

Port Autonome de Nantes / St. Nazaire

France Saint-Nazaire Louis Joubert 350 50.0 13.0 * *

226 30.0 9.0 * *

159 17.0 9.0 * *

Damen Ship repair Brest(formerly Sobrena Ship repair Yard)

France Brest 1 225 27.0 4.6 *

2 338 55.0 9.1 *

3 420 80.0 10.4 *

Port Autonome de Marseille France Marseille Forme 10 465 84.0 9.2 *

320 50.0 12.0 *

250 37.0 8.0 *

171 19.3 5.6 *

Hellenic Shipyards(ThyssenKrupp Marine Systems)

Greece Skaramagkas 421 75.0 5.5

335 53.6 7.9

252 37.0 8.5

232 34.0 6.0

196 32.0 6.5

Cantiere navale fratelli Italy Livorno 350 56.0 9.7

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https://en.wikipedia.org/wiki/Livorno

https://en.wikipedia.org/wiki/Italy

https://en.wikipedia.org/wiki/Cantiere_navale_fratelli_Orlando

https://en.wikipedia.org/wiki/Skaramagkas

https://en.wikipedia.org/wiki/Greece



https://en.wikipedia.org/wiki/Hellenic_Shipyards

https://en.wikipedia.org/wiki/Hellenic_Shipyards

https://en.wikipedia.org/wiki/Marseille

https://en.wikipedia.org/wiki/France

https://en.wikipedia.org/w/index.php?title=Port_Autonome_de_Marseille&action=edit&redlink=1

https://en.wikipedia.org/wiki/Brest,_France


https://en.wikipedia.org/w/index.php?title=Damen_Shiprepair_Brest&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Damen_Shiprepair_Brest&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Louis_Joubert&action=edit&redlink=1

https://en.wikipedia.org/wiki/Saint-Nazaire


https://en.wikipedia.org/wiki/Le_Havre


https://en.wikipedia.org/wiki/Soreni

https://en.wikipedia.org/w/index.php?title=Port_Autonome_du_Havre&action=edit&redlink=1

https://en.wikipedia.org/w/index.php?title=Port_Autonome_du_Havre&action=edit&redlink=1

https://en.wikipedia.org/wiki/Dunkerque


https://en.wikipedia.org/w/index.php?title=ARNO_Dunkerque&action=edit&redlink=1

https://en.wikipedia.org/wiki/Chantiers_de_l'Atlantique

https://en.wikipedia.org/wiki/Chantiers_de_l'Atlantique

https://en.wikipedia.org/wiki/Saint-Nazaire




Orlando 2 206 21.0 7.0 *

3 335 40.0 10.6 *

5 227 35.0 7.0 *

Fincantieri Cantieri Navali Italiani

Italy Palermo 1 163 22.8 7.4 * *

2 193 30.2 7.8 * *

3 286 46.2 7.6 * *

4 370 68.0 11.4 * *

Trieste 3 206 28.6 8.0

4 295 56.0 11.0

Monfalcone 350 56.0 11.0 *

La Spezia (Muggiano) 265 38.0 9.5

Genoa Sestri Ponente 1 255 36.0

Sestri Ponente 2 285 42.0

Malta Shipyards Malta Valletta 1 154 18.0 3.7 *

2 (Hamilton) 170 25.0 8.8 *

4 262 40.0 8.5 *

5 216 27.0 8.5 *

6 (Red China) 360 62.0 9.1 *

Keppel Verolme Netherlands Rotterdam 5 230 33.5 8.0

6 275 40.4 10.3

7 405 90.0 11.1

Shipdock Netherlands Amsterdam Dock 4 250 36.3 8.0 *

Dock 3 205 26.8 8.2 *

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https://en.wikipedia.org/wiki/Amsterdam

https://en.wikipedia.org/wiki/Netherlands

https://en.wikipedia.org/w/index.php?title=Shipdock&action=edit&redlink=1

https://en.wikipedia.org/wiki/Rotterdam


https://en.wikipedia.org/wiki/Keppel_Verolme

https://en.wikipedia.org/wiki/Valletta

https://en.wikipedia.org/wiki/Malta

https://en.wikipedia.org/w/index.php?title=Malta_Shipyards&action=edit&redlink=1

https://en.wikipedia.org/wiki/Genoa

https://en.wikipedia.org/wiki/La_Spezia

https://en.wikipedia.org/wiki/Monfalcone

https://en.wikipedia.org/wiki/Trieste

https://en.wikipedia.org/wiki/Palermo

https://en.wikipedia.org/wiki/Italy



https://en.wikipedia.org/wiki/Cantiere_navale_fratelli_Orlando



Dock 2 165 21.5 6.0 *

Dock 1 140 19.5 5.1 *

Damen Ship repair Rotterdam Netherlands Schiedam Dock 8 307 46.1 9.5 *

Dock 7 217 28.3 8.9 *

Dock 6 211 28.3 8.9 *

Dock 1 175 25.8 6.4 *

Dock 2 160 23.8 6.4 *

Gdynia Shipyard Poland Gdynia 380 70.0 8.0

241 40.0 8.0

Lisnave Portugal Setúbal Dock nº 20 420 75.0 4.6 *

Dock nº 21 450 75.0 7.6 *

Dock nº 22 350 55.0 7.6 *

Dock nº 31 280 39.0 5.1 *

Dock nº 32 280 39.0 5.1 *

Dock nº 33 280 39.0 5.1 *

Daewoo Mangalia Heavy Industries

Romania Mangalia No. 1 Dock 302 48.0 9.0

No. 2 Dock 320 48.0 18.0

No. 3 Dock 360 60.0 13.0

Santierul Naval Constanta Romania Constanţa Dry dock no. 1 350 58.0 10.0 * *

Dry dock no. 2 350 48.0 10.0 * *

Floating Dock no. 1 138 23.0 4.0 * *

Floating Dock no. 2 180 32.0 6.0 * *

Damen Shipyard Galati Romania Galaţi 230 35.0 4.5 *

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https://en.wikipedia.org/wiki/Gala%C5%A3i

https://en.wikipedia.org/wiki/Romania


https://en.wikipedia.org/wiki/Constan%C5%A3a


https://en.wikipedia.org/w/index.php?title=Santierul_Naval_Constanta&action=edit&redlink=1

https://en.wikipedia.org/wiki/Mangalia


https://en.wikipedia.org/wiki/Daewoo_Mangalia_Heavy_Industries

https://en.wikipedia.org/wiki/Daewoo_Mangalia_Heavy_Industries

https://en.wikipedia.org/wiki/Set%C3%BAbal

https://en.wikipedia.org/wiki/Portugal

https://en.wikipedia.org/w/index.php?title=Lisnave&action=edit&redlink=1

https://en.wikipedia.org/wiki/Gdynia

https://en.wikipedia.org/wiki/Poland

https://en.wikipedia.org/wiki/Gdynia_Shipyard

https://en.wikipedia.org/wiki/Schiedam





230 35.0 4.5 *

Novorossiysk Ship repair Yard Russia Novorossiejsk Dock № 2 220 28.0 9.0 *

Dock № 3 300 48.0 11.0 *

Ship repair Yard № 82 Russia Roslyakovo PD-50 330 88.0 6.1

Navantia Spain Cádiz Dock no.1 237 34.1 *

Dock no.2 246 41.3 *

Dock no.3 387 66.7 *

Cadiz (Puerto Real) Dock no.1 525 100.0 9.0 *

Ferrol 330 50.0 *

205 25.0 *

Fene 255 38.0 9.0 *

155 24.0 5.2 *

Cartagena 214 20.5 7.5 *

İstanbul Naval Shipyard Turkey Istanbul 116 24.2 5.7

189 29.4 6.5

300 70.0 8.5

Chornomorsk Ship repair Yard Ukraine Chornomorsk Floating dock № 152 225 36.6 *

Floating dock № 154 225 36.6 *

Harland and Wolff Heavy Industries

United Kingdom

Belfast Building Dock 556 93.0 8.4 * *

Belfast Dry Dock 335 50.3 12.2 *

Able UK United Kingdom

Teesside 376 233 12.15

Cammell Laird, The Peel United Inchgreen Drydock, Greenock 305 48.0 11.3

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https://en.wikipedia.org/wiki/Greenock

https://en.wikipedia.org/wiki/United_Kingdom

https://en.wikipedia.org/wiki/The_Peel_Group

https://en.wikipedia.org/wiki/Cammell_Laird

https://en.wikipedia.org/wiki/Teesside



https://en.wikipedia.org/wiki/Able_UK

https://en.wikipedia.org/wiki/Belfast



https://en.wikipedia.org/wiki/Harland_and_Wolff

https://en.wikipedia.org/wiki/Harland_and_Wolff

https://en.wikipedia.org/wiki/Chornomorsk

https://en.wikipedia.org/wiki/Ukraine

https://en.wikipedia.org/w/index.php?title=Chornomorsk_Shiprepair_Yard&action=edit&redlink=1

https://en.wikipedia.org/wiki/Istanbul


https://en.wikipedia.org/w/index.php?title=%C4%B0stanbul_Naval_Shipyard&action=edit&redlink=1

https://en.wikipedia.org/wiki/Cartagena,_Spain

https://en.wikipedia.org/wiki/Fene

https://en.wikipedia.org/wiki/Ferrol,_Galicia

https://en.wikipedia.org/wiki/Puerto_Real

https://en.wikipedia.org/wiki/Cadiz

https://en.wikipedia.org/wiki/C%C3%A1diz

https://en.wikipedia.org/wiki/Spain

https://en.wikipedia.org/wiki/Navantia

https://en.wikipedia.org/wiki/Roslyakovo

https://en.wikipedia.org/wiki/Russia

https://en.wikipedia.org/w/index.php?title=Novorossiejsk&action=edit&redlink=1

https://en.wikipedia.org/wiki/Russia

https://en.wikipedia.org/w/index.php?title=Novorossiysk_Shiprepair_Yard&action=edit&redlink=1



Group, Clydeport Kingdom

A&P Group United Kingdom

Hebburn (Tyne) Dock No. 1 259 44.0 10.6 *

Falmouth Dock No. 2 253 39.6 11.0 *

Dock No. 3 221 26.8 8.6 *

Dock No. 4 173 26.2 8.3 *

Middlesbrough (Tees) Dock No. 5 175 22.2 6.9

Cammell Laird Shiprepairers and Shipbuilders

United Kingdom

BirkenheadNo 4 Dock 125 21.0 8.0 *

No 5 Dock 289 42.7 11.5 *

No 6 Dock 203 23.3 9.0 *

No 7 Dock 251 25.5 10.0 *

Babcock Engineering Services UK Rosyth 1 310 31.0 10.8 * *

Source: This Study based on Wikipedia 2019 and other myriad sources.

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https://en.wikipedia.org/wiki/Rosyth

https://en.wikipedia.org/w/index.php?title=Babcock_Engineering_Services&action=edit&redlink=1

https://en.wikipedia.org/wiki/Birkenhead





https://en.wikipedia.org/wiki/Tees

https://en.wikipedia.org/wiki/Middlesbrough

https://en.wikipedia.org/wiki/Falmouth,_Cornwall

https://en.wikipedia.org/wiki/River_Tyne

https://en.wikipedia.org/wiki/Hebburn



https://en.wikipedia.org/wiki/A%26P_Group


https://en.wikipedia.org/wiki/The_Peel_Group


The global ship repair and maintenance services market is expected to reach over US$ 39,934.8 million by the end of forecast period, registering a CAGR of 6.9%. According to analysis, the demand for ship repair and maintenance services is expected to keep fluctuating over the years. The global ship repair and maintenance services market is mostly fragmented, with a large number of players holding a substantial market share as of 2017. The global ship repair market is further characterised by the phenomena of mergers and acquisitions. The major yards tend to get bigger while the small and the unsuccessful yards are absorbed by larger yards. Globally, the top 10 players in the ship repair and maintenance services market collectively hold between 7% and 9% of the market share. Prominent players covered in the ship repair and maintenance services market include Hanjin Heavy Industries (South Korea), Hyundai Mipo Dockyard Co., Ltd. (South Korea), China Shipbuilding Industry Corporation (CSIC) (China), Damen Shipyards Group (Netherlands), Cochin Shipyard Limited (India), Swissco Holdings Limited (Singapore), Egyptian Ship Repair & Building Company (Egypt), Desan Shipyard, Sembcorp Marine Ltd. (Singapore) and United Shipbuilding Corporation (Russia), among others.

Figure 6.2: Global Ship Repair Market Services Market Share by Vessel Type 2017

Source: Future Markets Insights 2018

The expansion of new ship repair facilities within Asia - especially in China and Vietnam - is expected to have a profound impact on established facilities such as Singapore and other major competitors in the Middle East and Japan. The Chinese governmental support for the development and expansion of its ship repair industry is expected to maintain a downward pressure on forward prices, hence giving the Chinese yards a competitive advantage over other yards within the region, which have to make do without government support. Mainland China further emerges on a worldwide basis as the cheapest area in which to carry out steelwork. Competition within Mainland China could push price levels down even further, making China without a doubt the cheapest area in which to carry out steelwork.

Singapore is expected to dominate the global ship repair and maintenance services market In contrast, Singapore’s shipbuilding and repair sector was characterised by low taxes, a business-friendly environment, little infrastructure development by the State and an emphasis on private investment. Singapore has a total dry-dock capacity of 3.5 million dwt, following the opening of a 360,000dwt facility at Keppel and a 400,000 dwt unit in Jurong. Both of these added facilities

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are wide enough to handle double-hulled Ultra Large Crude Carriers (ULCC). This industry has yet to grow to its full potential and is limited by size and capacity constraints. In India the ship repair industry is much less visible with only 3-4 yards engaged in any meaningful ship repair activity. However, China and India ship repair and maintenance services markets are expected to gain traction over the next decade, owing to the anticipated increase in trade with the Middle East and SEAP countries. Geographical advantage and low-labour cost are the key factors determining the growth curve of the ship repair and maintenance services market in South East Asia and India. Table 6.4 details the major global competitors within the ship repair industry in terms of Panama size floating docks. In terms of the overview of South African port competitiveness within the global market, South African ports such as Cape Town, Durban and Richards Bay are considered Tier Three while ports in Singapore and China are considered Tier One as depicted in Figure 6.5 below.

Figure 6.5: Global Port Rankings

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Table 6.4: List of Major Global Competitors For the Indian Ocean Rim Trade Route

Yard Country City Dock Name L (m)

B (m)

D (m)

Repair Floating Dock

CIC Shipyards China Changxing, Shanghai

CS Jiuhuashan

308 50 17.5 * *

CS E’meishan

410 72 18.5 * *

CS Putuoshan

247 36.6 8.5 * *

CS Pudong 222.5

38 * *

COSCO Shipyards Group

China Guangdong Yuan Yang No. 1

260 48.5 22.5 * *

Yuan Yang No. 2

269 59.2 18 * *

Lianyungang Zhongyuan Sheshan

240 37 12.8 * *

Guangzhou Cui Hua Shan

239 40 6.5 * *

Dalian Dalian 350 66 27 * *Shanghai Ship Repair Centre

China Shanghai 270 48 16.7 * *257 42 16 * *250 43 15 * *

Shanghai Shipyard CSSC

China Shanghai Xin Xiang Shen 245 39.4 15.3 *

Qindao Beihai Shipbuilding Heavy Industry

China Qingdao250 45 * *

Yiu Lian Dockyards (China Merchant Holdings)

China Shekou No. 3 240.5

36 6 * *

No.3 Hongkong 305 45.8 15 * *

Kawasaki Shipbuilding Corporation

Japan Kobe281 46.4 *

Sembawang Shipyard (Sembcorp)

Singapore Woodlands President290 48 8.5 *

STX Offshore & Shipbuilding

South Korea Jinhae Floating Dock No. 1 355 58 *

Daewoo Shipbuilding & Marine Engineering

South Korea Okpo, Geoje F.D No. 1 298 51.5 20.3 *

F.D No. 3 362 62 21 *

Samsung Heavy Industries

South Korea Geoje G2 Dock 400 55 15 *G3 Dock 400 70 15 *

Hyundai Samho Heavy Industries

South Korea Samho-Eup Floating Dock 337 70 24 *

Sungdong Shipbuilding & Marine

South Korea Tongyeong Yard No. 2320 67 23 *

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Yard Country City Dock Name L (m)

B (m)

D (m)

Repair Floating Dock

EngineeringTsuneishi Shipbuilding

Philippines Balamban, Cebu

128 23.3 * *140 24.5 * *

PT Pal Indonesia (Persero)

Indonesia Soerabaja128 20.3 6 *

Dubai Drydocks United Arab Emirates

Dubai (Port Rashid)

Floating Dock 205 32 * *

Cochin Shipyard Ltd

India Cochin 270 45 12 * *

Source: Various Internet Sources 2019

7: Advantages Of Creating A Floating Dock Within A Port

The potential mobility of floating dock provides advantages in that it can be moved towards vessels within and outside the port limit environs, enhancing dock, ship repair and port/vessel productive efficiency and performance for port/back of port and intermodal hinterland connections.

Faster vessel turnaround time over drydocks exists in deballasting water faster. It enhances potential ship repair facility competitiveness in offering an alternative for

consumers/clients to an existing Graving Dock, with price, quality and other service benefits. It satisfies further other Table 1 stakeholder identified requirements including increased availability of facilities, price competitiveness and technological modernisation.

Financial saving on Port Tariffs and drydock fixed costs and opportunity costs from poor maintenance or lack of availability.

Increase in vessel age over time and experience across a range of repair activities Mobility can aid with protection from strikes, crime, protests, civil strife and other issues. Legally - being mobile the floating dock is easier to initially construct/operate with less

applicable legislation to comply with. Lacks equivalent land/drydock space limitations and can save space benefitting from

technical, locational and other economies of scale. It can be cheaper to maintain on average and offers high resalable value when needed. It is flexible and alterable to vessel sizes, dimensions, types and into 2 separate floating

docks for suboptimal market demand. Benefits such as when drydocks collapse (USA), fail or are poorly maintained (Transnet) Economic benefits or advantages include complementing existing recent and proposed port

or blue economy developments under Operation Phakisa and future aims at potential to create employment; contribute to direct and indirect GDP, consumption, production and income, tax revenue; value added activities; port duties; aid ship repairs. For example, in 2016 Dormac created 80 permanent jobs through its 175 metre, Durban floating dock. Specific value chain opportunities are identified in Table 19.

Provision of an extended artisan training programme for local skills development (i.e. Dormac provided 33 for its floating dock) and increased prosperity through employee share ownership.

Other benefits to the host economy include those of supporting local versus foreign supply chain stakeholders i.e. import substitution along with improving the balance of trade and pressures on scarce foreign currency reserves. It includes trade and market diversion;

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reduced environmental externalities, corporate social responsibility; training and education; marketing and locational economies of scale.

Tax advantages in requiring a shorter depreciation schedule than a fixed dock. Long established record and experience of existing client including Quality Assurance

accreditation standards exist to ISO 9001:2008.

Table 19: Employment Opportunities in the Floating Dock/Ship Repair Sector

Career Level Specialisation Ideal Qualifications NQF LevelStrategic Management

Research Professional Director PhD 10

Senior Management Naval ArchitectMaster Builder

Master’s DegreePostgraduate Diploma

98

Middle Management Marine EngineerSupport ProfessionalComposite EngineerOperations Manager/HR/Finance/ LegalMechanical EngineerDesigner

Batchelors Degree/Honours 7

Supervisory Technician/Artisan Carpenter, Plumber, Electronics, Electrician, Sail maker, Rigger, procurement, Logistics.Trades and technical, slipway operator

DiplomaHigher Certificate

Certificate Yacht etc, Boatbuilding Level 3, Grade 12

654

Work Force/Labour Boiler maker/Welder/Cabinet Maker/ Joiner, Metal Fabrication, PainterAssistant Plumber/Pre-FinisherLaminator/Grinder/Polisher/Sander

Certificate Yacht/Boatbuilding L3, Grade 11Certificate Yacht/Boatbuilding L4, Grade 10 ABT Numeracy and LiteracyGrade 9 ABT Numeracy and Literacy

3

2

1

Source: SAMSA 2012

8: Disadvantages/Externality Costs Associated With the Floating Dock

Potential disadvantages include externality costs i.e. noise; pollution; ecological; smell; congestion and others summarised in Table 20. Marine and land environmental sources, species, water reserves, wrecks, underwater heritage, geology and other natural/cultural resources need to be investigated and sufficiently protected throughout the floating dock’s existence to minimise any possible adverse consequences.

Lack of specialised giant floating dock skills, education and investment in human capital Being submerged in the water; a floating dock can incur higher maintenance costs than a

drydock. Additional mooring equipment is needed for stability. Slower speeds can materialise from accessing equipment, technology and labour from a

single vessel access point.

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Higher risk exposure to climate/climate change and related air/water/land phenomena including wind, wave energy; currents, sedimentation, temperature, tides, cyclones, heatwaves, flooding, tsunamis, earthquakes and storms. Yet, unlike fixed drydocks, these can be moved towards more sheltered port areas to be more climate resilient and futureproofed against projected disruption risk event increases in frequency, duration and intensity.

During reflooding, additional time is taken through removing equipment and components.

Table 20: Potential Environmental Disadvantages/Externality Costs of a Floating Dock and Ship Repair Facilities

Maritime Emissions/Air pollution from moving the floating dock/increased vessel arrivals

CO2, methane (CH4), nitrous oxide (N2O), perfluorocarbons (PFC’s), hydrofluorocarbons (HFC’s), sulphur hexafluoride (SF6) and nitrogen trifluoride (NF3)

Value chain/industry smog/pollution logistics, materials, distributionSolid waste Metals, equipmentHazardous waste Chemical dumpingPotential recyclable waste paper, plastic, glass, packaging, organicHydrocarbon pollution Energy/petroleum use/ oil spillBlack water SewerageGrey water Cleaning/Drinking waste water from plumbing, detergents kill lifeBilge water Alien species, foreign bacteria and virusesBallast water Alien species, foreign bacteria and virusesEutrophication Alien species, foreign bacteria and virusesOcean acidification coral bleaching, ecosystem lossSpecies/Biodiversity loss/pressure Endangered species, contaminated seafoodGeological/ Vegetation loss loss of heritage, erosion, subsistence, ecological resilience

seagrasses, mangroves, coral reefsCoastal erosion, soil and sedimentation Nutrients, sand lossDrain on fresh water Irrigation, food securityFuture Sustainability Coastal over development pressureSound, light Climate Change

Source: This Study

9: Risks/Challenges/Concerns/Constraints.

Constraints to be managed include those in Table 15. Examples include climate change; climate; political-economic uncertainty; competition by neighbours; government policy and substitutes; piracy; remoter geographical location in comparison to Europe, Asia and Middle East alternatives, ensuring sufficient Quality and Productivity;

Existing high port costs vessel callers, among the highest in the world Legal status/requirements/Institutional/regulatory issues. Although legislation does not

specify requirements for a floating dock, existing ship repair industry legislation will need to be applied to the newly proposed floating dock. Examples include the 1951 Merchant Shipping Act, 1983 Admiralty Jurisdiction and Regulatory Act, 1993 Occupational Health and Safety Act, the 1994 Maritime Occupational Safety Regulations, the 2002 and 2007 Merchant Shipping Regulations, the 2005 National Port Act, 2013 Customs Control Bill and the 2014 environmental impact assessment, 1998 Water Act, 2004 Air Quality Act and other

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legislation. Other legislation South African Shipyards may have to comply with includes the Marine Traffic Act, Marine Pollution (Control and Civil Liability) Act, Marine Pollution (Prevention of Pollution from Ships) Act, Marine Pollution (Intervention) Act, Maritime Zones Act, Wreck and Salvage Act and the SAMSA Act. It includes the 1973 Sea Birds and Seals Act, 1989 Marine Living Resources Act, 1996 Constitution, 1998 Environmental Management Act 1999 Natural Heritage Resources Act, 2003 and 2004 National Environmental Management Biodiversity Acts, 2008 Integrated Coastal Management Act and 2017 Marine Spatial Planning Bill plus any TNPA Port Tariffs and charges. (Nemai Consulting 2018).

There are currently statutory local content requirements for industry to minimise import substitutions under the Department of Trade and Industry/Customs which may limit the procurement of customised components needed for larger vessels. The Department of Transport is aiming for a 10% increase under the Comprehensive Maritime Transport Policy of 2017.

Uncertainty of Demand and Supply -for fluctuating markets based on shipping cycles. Other risks and subsequent mitigation include a shortage of Durban port space and suitable

locations aside from Salisbury Island with challenges over existing land use and zoning. Access to finance remains a concern in financing the floating dock as South Africa/Africa

lack maritime financing sources and existing banks do not support the blue economy sector including accepting vessel work in progress as sufficient collateral, unlike international counterparts.

Transnet is currently experiencing procurement, finance and auditing issues based on politics, potentially delaying its competitor projects

Reputational and other risks -external and private sector risk expectations associated with conducting business in South Africa or Africa.

Competitor risk threat from refurbishment of Prince Edward Graving Dock in Durban and proposed dock for Richard’s Bay (which is aiming for 1,000 jobs and Capesize capacity vessels of 18 metre maximum drought), as indicated in Report 2’s competitor analysis.

Table 21: Constraints/Challenges Potentially Affecting a Floating neo-Panamax Dock

Land/Geophysical Environmental Information Political Communication Administrative Labour Technical/Technological Capital Lack of Coordination Financial/Funding Lack of Cooperation/Psychological Commercial: Profits Education/Training

o Fixed costs Planning/zoningo Variable costs Transport

Demand/Supply Uncertainty of Climate Change Enforcement Capacity, Legal and Policy Other

Source: This Study.10.1: Africa Opportunities and Recommendations

As section III emphasised, for the next 10-15 years at a minimum, shipyards can further benefit from a lack of African competitors.

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Port developments include Namibia (from 350,000 to 750,000 TEU’s and others. Mombasa had reserved land for a Uganda drydock but this is contested by the indigenous

community and politics over land ownership and invasions. It is proposed to increase vessel capacity from 2,500 to 6000 TEU’s from December 2017.

Opportunities exist to support African Union Integrated Maritime Strategies to support local African fleets. Nigeria are heavily pursuing cabotage. Liberia operate the 2nd largest flagged merchant shipping fleet in the world. Both lack globally competitive dock facilities.

Few patrol and naval vessels exist to secure a coastline of 31,000 kilometres in Africa.

10.2: Global Opportunities and Recommendations

Few Southern Hemisphere competitors exist or for Oceania, South and North America. Regular market opportunities from scheduled drydocking requirements for vessels at least

once every 5 years. International Maritime Organisation 2020 implemented regulations via retrofitting including

the 2020 Sulphur Fuel Cap and Ballast Water Management Convention as vessels need to convert to LNG, install scrubbers and adapt technology, creating floating and dry dock vessel conversion opportunities. Increasing global market conditions favour environmental sustainability via the blue, green and circular economies.

Provision of shipboard financing and credit to stagger up to 60 percent of their dry/floating docking payments into 12 or more monthly instalments following examples such as Newport Shipping as traditional maritime financing sources decline and shipping companies seek alternatives. It provides a liquidity buffer reserve.

Jamaica provides a case study success of financing a drydock through initial shares of $600,000 to determine the first stage pre-feasibility, followed by a second stage of full studies of $2,400,000 based on the projected revenue potential of the initial report (Cole 2013). It evaluated several options including listing on the Jamaican Stock Exchange, Joint Venture Agreements and Syndicated Loan Arrangements.

Consider the benefits and follow technological/other developments of the International Association of Ship Repairers, International Association of Ports and Harbours, UNCTAD, International Maritime Organisation, Engineering News South Africa, SAIMENA, SAMSA, SAASOA and South African Association of Ship Repairers and Builders.

11. CONCLUSION

In conclusion a decision to invest in a neo-Panamax floating dock will increasingly need to consider increasing changes in stakeholder requirements, vessel sizes, technology, market conditions, performance and efficiency indicators to be successful. Vessel sizes are particularly increasing, with fewer scheduled callers and increasing cargo capacity. In 1980 Panamax vessels were introduced as containing 3,000-3,400 TEU’s, 250 metres long, 32 metre width and 12.5 metres draught requiring 13.3 metre berth depths. In 1988 Post-Panamax vessels required 4-5,000 TEU’s, 280-305 metres with 40.1 metre bean; 12.7-13 metre draught and 13.8 metre berth depth. This represents the physical limits of vessel demand for SA Shipyard’s proposed 280 by 52 metre floating dock. Section 3 will project a method for a more comprehensive demand against optimal potential capacity limits.

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An efficiency analysis of international competitor ports, indicated certain advantages in situating the dock as more efficient and with greater physical dimensions/facilities than many Southern hemisphere/Sub-Saharan African alternatives such as Tema, Douala, Mombasa, Windhoek, Dar es Salaam, Port Louis, Egypt and others. It needs to consider strategic route, labour and resource costs over Oceania, South, North and Central America along with the Caribbean, the Middle East and Asia. This report identified possible future competitor risk threats, so timing remains crucial to be favourably competitive. However, other opportunities may emerge under various global blue and ocean economy initiatives; growing stakeholder demand interest as consultations affirmed and, as Section 3’s microeconomic analysis for demand model forecasting will more comprehensively analyse.

REFERENCES

Cole L, 2013, “IDSAF Caribbean Dry Dock Presentation,” Kingston.

Dev A, and Saha M, 2017, Ship Repairing Time and Labour, MARTECH Conference, Singapore.

Dyer J, 2015, “Is Durban’s Proposed Port Expansion Really Necessary?” UKZN Master’s Thesis, Durban.

European Commission 2017, “Study on New Trend in Globalisation in Shipbuilding and Marine Supplies -Consequences for European Industrial and Trade Policy,” European Commission Report, Brussels.

Jonkers G, 2003, “An Evaluation and Assessment of Ship Repair Opportunities for South Africa using the Port of Durban as a Case Study in an Attempt to Develop A Framework Plan for the Ship Repair Industry in the Port of Durban, University of Natal Master’s Thesis, Durban.

Kenya Port Authority, 2015, “Annual Review and Bulletin of Statistics,” KPA Report, Mombasa.

Namibia Port Authority, 2017, Annual Report 2016-2017, Namibia Port Authority Report, Walvis Bay.

Nemai Consultants, “Mossel Bay Repair Dock Report for Transnet,” Nemai Consultants, Mossel Bay.

Port Regulator Authority, 2019, “Transnet National Port Authority 2019 Port Tariffs,” Port Regulator, Durban.

Port Regulator Authority, 2018, “Global Pricing Comparator Study, Port Regulator, Durban.

Price Waterhouse Coopers, 2018, “Strengthening Africa’s Gateways to Trade. An Analysis of Port Development in Sub Saharan Africa,” Price Waterhouse Coopers Report, London.

Raballand G, Refas S, Beuran M and Isik G, 2018, “Maritime Transport in Africa, Challenges, Opportunities and an Agenda for Future Research,” Why Does Cargo Spend Weeks in Sub Saharan African Ports?” Lessons from 6 Countries, World Bank Report, New York.

Robert Heger, 2014, “Large Floating Docks in the United States,” DM Consulting Dry Dock Conference, New Orleans.

SAMSA, 2012, “South Africa Vessel Construction and Repair Profile 2012, SAMSA Report, Durban

Scholtz C, 2017, Durban Container Terminal Capacity Analysis and Feasibility of a Dry Port Concept, University of Stellenbosch Master’s Thesis, Stellenbosch.

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Sivest 2018, “Construction of Marine Infrastructure in the Port of Richard’s Bay. Draft Basic Assessment Report, Transnet Report, Durban

Tanzania National Port Authority, 2016, Tanzania Port Authority Report Dar es Salaam.

Tes Teach with Blendspace, 2017, "Indian Ocean Trade."19 May 2017.

Transnet 2019, “TNPA Port Consultative Committee Roadshow,” Durban.

Transnet National Port Authority, 2018, “Operation Phakisa Marine Transport and Manufacturing 3 Feet Plan Review Workshop -Status of TNPA Initiatives,” TNPA Report, Durban.

Transnet National Port Authority, 2016, “TNPA B2B Networking Forum”, Johannesburg.

United Nations Conference on Trade and Development, 2018, “Review of Maritime Transport,” UNCTAD Report, London.

Weiss J, 2018, Rise and Decline of the Shipbuilding Industry in Brazil,” International Association for Management of Technology Conference, Rio de Janeiro.

Zangwa A, 2018, “A Total Factor Productivity Analysis of a Container Terminal, Durban, South Africa, World Maritime University Master’s Thesis, Malmo.

SECTION III: DEMAND AND SUPPLY MARKET FORECASTINNG MODEL AND ANALYSIS

3.1: Introduction

This section’s primary objective is to provide an economic and other justifications to motivate the market feasibility for South African Shipyard’s significant decision to invest in this facility. It therefore considers potential demand based on stakeholder consultation, demand and supply model forecasting and microeconomic fiscal/cost-benefit analysis. It further identifies prospective advantages, disadvantages, risks and opportunities, to further ensure long term commercial viability and overall sustainability, efficiency and productivity based on stakeholder requirements and market expectations.

3.2: Stakeholder Perspective

Stakeholder Consultation Analysis: Projected Requirements and Demand for the Floating Dock

As background preparation for the proposed demand forecast model in section 3.2; several significant stakeholders were interviewed concerning their general experiences with ship repair dock facilities. Given that the client’s specific floating dock remains commercially sensitive; the interviews conducted by this report’s principal maritime economist obtained insight into a hypothetical scenario if one were to invest in a graving dock versus a floating dock at the site specific location or alternative locations as it has contemplated under many ocean economy strategies as reviewed in a global literature study also published on the website, under Report

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2’s market competitor analysis. These included several shipping companies, academia and the yachting/marine recreation community, port authority, professional associations, host city, and various marine industry/ship repair supply chain stakeholders were invited to participate but expressed no interest in responding by the time of this report section’s completion. Many indicated a reluctance to participate. The city and others failed to provide relevant insight.

3.2.1: Major Container Shipping Company A, Prospects of A Floating Dock and Ship Repair Perspective

In determining whether or not to use ship repair facilities, most decisions are centrally taken at headquarters; local offices can only recommend for local vessel emergencies.

To ensure investment in ship repair facilities so a floating dock is viable it needs attention to quality of Infrastructure, trained labour and affordable labour/material combined with a quick turnaround time, berth availability, utilization rate. Response time is crucial.

Concerns about labour strikes/underperformance for port-back of port efficiency. The company has zero current use of many ship repair facilities, as these are mostly

undertaken in Europe/China/Far East. Some interest potentially exists if a private sector initiative, given past experiences with

various port authorities for regular and occasional demand/emergency repairs. Potential interest for chartered vessels as well to undergo scheduled maintenance but

this would depend on the prioritising of minimization of costs and quality of service/ It is difficult to provide the average nature of repairs/costs/vessel types/risks etc. in

preparing the recommendations as they occur on a case by case basis. Desire a dock information pack for targeted marketing -i.e. how can it work from

intended service provider. Current concerns exist about vessel size dimension limits for ports; contract obligations

and restriction influencing decisions over ship repairs. Moving forward, they would be interested in subsequent engagement and direct links to

both the local office and headquarters. It needs to be sufficiently attractively marketed to entice customers including the quality

of customer service and VIP treatment status.

3.2.2: Prospects of A Floating Dock and Ship Repair Perspective (Academia)

The professional noted the achievement of local dock shipbuilding capacity, The greater the size of the proposed floating dock, the better -i.e. to service Cape Size,

neo-Panamax and Suezmax to be economically viable in planning 15-25 years ahead as vessel sizes are increasing.

Could attract passing bunkerage trade and occasional callers. In proposing a suitable floating dock and associated facilities, the source advises

needing to consider a serious survey of vessel characteristics such as length, depth, breadth, commodity type; location of vessel/route and compare competition. Vessel sizes are expanding but numbers are falling.

Existing car carriers are maximum 230 metres in length (ro-ro); Bunkerage maximum 261 metres; dry bulk maximum 200-220 metres; For container vessels -50% are 300+ metres and too large for proposed dock.

Consider the extent of economic multiplier effects and other gains/advantages

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Many vessels exceed 300 metres and fewer are 200-300 metres indicating sub-optimal allocation and usage of proposed floating dock facilities.

Need for investment in repair facilities highlighted by increasing pressures of climate change, natural disasters and extreme weather events. This created opportunity costs for other ship repairs and bunker callers. Local industry and shipyards took over minor repairs but lacking facilities incurred challenges. Issues of delay time/lack of access were experienced. The shipping companies affected therefore consider there is a need for full-service ship repair facilities to service vessels on the Indian Ocean Rim to Africa to Europe trade routes.

The issue of coast and climate/climate change challenges may create subsequent ship repair market opportunities

In motivating the market potential for funding, it is essential to consider economic spillover and other externality multiplier effects generated.

Manufacture of tugs and other vessels offers potential for import/export to African markets.

Issue of physical constraint for most proposed port sites. Need a sufficient turning basin and landside stacking/area equivalent.

Why limit to Panamax capacity? Why waste the limit given vessel sizes are expanding? It is essential for the engineers to consider space available, maximum displacement; LCA

Few tankers, medium size vessels, Limits of Ro-Ro vessels could be accommodated by proposed design. Need to consider a complementary port system and the competition.

3.2.3: Second Major Shipping Company Floating Dock and Ship Repair Perspective

All ship repairs aside from emergencies are currently undertaken in Far East. Average full-service turnaround time is 10 days so uninterested in others except for

emergencies. Concerns exist over the expense of demiurge and chartering costs for any delays.

No current usage/demand for ship repair facilities and docks given existing port vessel physical, labour and other limitations. Vessels are claimed to be well maintained with only minor repairs around coastlines. Managers claim to favour proactive risk management.

Certain ports and major shipping lines has its own mobile repair teams and facilities that can be deployed.

Would primarily express demand for minor emergencies and maintenance. Factors of importance include price, availability, quality of workmanship and trained labour/availability of parts and services. Its position in the port, competitiveness and quality service up to international standards needs to be considered.

Decisions to use ship repair facilities are centrally sourced/determined. Most vessel calls are a minimum 300-320 metres so would have to fit those dimensions

as vessel sizes are becoming larger. Reluctance to get involved with certain African/Southern hemisphere ports based on

past experience. Their response is to consider privatisation of facilities and professionally operated might aid to counter the reputational risk of interacting with these authorities.

3.2.4: Recreation and Yacht Repair Perspective

International yachts deterred by reputation risk.

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High cost just to start using the slipway; versus $50 in New Zealand for regular cleaning service.

Derelict, poor maintenance of marina sliplift facility; cost, quality of service paramount as the yacht clubs and community consider that many are not rich yachting people, needing to be affordable to those on a budget -many vessels are not being cleaned regularly.

Opportunities for regular cleaning, vessel exports and repairs with increased demand.

3.2.5: Third Major Container Shipping Company Floating Dock and Ship Repair Perspective

Discourage from/not really used existing ship repair facilities primarily due to size restrictions.

Considers that any proposed facility would at a minimum need to be 400 metres and up to 60 metres to be viable given increasing vessel sizes. In favour of it -high demand potential given strategic cargo distribution point.

Very few global floating docks exist around 400 metres and above but technical director confirms it is possible in Dubai, Singapore, Turkey.

Vessels are a minimum of 280-300 metres often. Largest vessels reach up to 366 metres at present. Drawback for existing facilities includes cranes. Many are poorly maintained and lists when taking high loads/cannot fully extend onto vessel.

Vessels on the European service are often limited to 300-320 metres based on port preferences and physical restrictions.

Questions why floating as opposed to drydock? Main factors to consider include sufficient cranes capacity; the size and properly

equipped workshops to conduct basic repairs including cost; time, service, maintenance minimising and offer, customised/quality services; engine work, availability; labour costs -i.e. in Europe wages would be 15-20 euros per hour versus skilled labour 30-50 euros compared to far lower in Africa per month. Need to consider the marine side and issue of integral coordination.

Need to project 20-40 years ahead in terms of forecast demand, supply, vessels etc. Issue of location needs sufficient vessel turnaround, depth clearance etc. Why not extend existing Graving Dock facilities? Open to public, private operated or even public-private partnership. Recognised the time and other benefits with various extreme weather events and natural

disasters. Issue of labour being restricted only to daylight hours which helped drag it to take 9 months with high costs.

Have their own technical workshops and roving repair teams and propose it useful to expand ship repair facilities to employ graduates

Expensive experiences of facilities in Europe -recognises local labour and steel price advantages but concerned about high port charges for existing facilities. Certain degree of high risk and uncertainty towards conducting business in Africa/Southern hemisphere.

Other advantages include high costs of fuel in relocating to Europe, close proximity to existing cargo services to arrange schedules.

Many older vessels used on the African coastal routes, require more maintenance, ballast and cleaning in port, presenting more market opportunities for the floating dock

3.3: Forecasting Potential Market Demand for the Neo Panamax Floating Dock

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Model Methods, Assumptions and Parameters

To create the demand forecasting model for the neo-Panamax Dock this approach first identified the total number of vessels in the total geographic shipping route area as most probable overall demand before selecting the proportion of demand specific to national and local ports historically. This is divided into different vessel types. Current demand for 2018-2019 was estimated. Of this proportion, the average percentage calling into the port for ship repairs was calculated as X%. Of this % sample, this is divided into the 4 main market opportunities, (from scheduled and predictable repairs/maintenance), (shipbuilding) and for vessel conversions/upgrading. This sample is then tested for Scenarios 1, 2 and 3 then Scenarios A, B and C, before suboptimal market demand is determined in relation to scheduled ship repairs and other markets. Supply analysis briefly considers projected demand against supply in relation to competitors. This was subsequently applied to a case study. Risks, advantages, disadvantages and opportunities were subsequently determined.

Figure 1: Calculating the Optimal Floating Dock Market Demand Process

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Total No of Vessels in Shipping Route Area

Total No of Vessels in Port

Current Demand January to June 2019 Historic Demand 2008-2018

Existing Durban Ship Repair Demand as 5% of total Callers

Various Market Segment OpportunitiesUnexpected Events, Shipbuilding, Scheduled Repairs; Upgrading + Conversion


Source: This Study

Parameters and assumptions will be considered in formulating the projected and real effective market demand forecast for the Neo-Panamax Floating Dock. This will assist in generating a sufficient demand profile based on historic, current and future market demand, although this report ultimately recommends consulting all existing and potential clients to test the assumptions and scenarios projected in this model. The primary input is to include measures of efficiency as measured by performance indicators such as optimal turnaround time, assuming the shipyard, sector and investors can meet internationally acceptable best practise standards in time, price and cost, maximising potential revenue and optimal design configuration/efficiency.

Scenario 1 represents a 1% Average Annual Decrease in the Number of Vessel Callers. Scenario 2 represents a 3% Average Annual Increase in the Number of Vessel Callers. Scenario 3: represents a 5% Average Annual Increase in the Number of Vessel Callers. Scenario A represents a floating dock of a maximum Size A metre length dimension. Scenario B represents a floating dock of a maximum Size B metre length dimension. Scenario C represents a floating dock of a maximum Size C metre length dimension. The model assumes a 25-30 year projected floating dock lifespan to be viable at a

minimum. The model assumes initial construction will take 2 years from to become operational. Parameter of 50 weeks operational, average of 2 weeks needed for

downtime/maintenance. Parameter of ship repair average time of 12-24 days (Table 3.8 Report 2). Parameter of average vessel maintenance times 2-3 weeks, needs scheduled once

every 5 years at a minimum, costs to remain consistent and proportional relative to vessel size/dimensions. International best practise is 10-15 days.

Inability to forecast vessel emergency accidents/repairs requiring occasional use of the floating dock or loss of 1 week downtime when moving and launching constructed vessels

Projected Costs/Revenue to Remain Consistent prior to development of subsequent financials.

Parameter of efficiency gains to be fractionally increasing over time based on port measures and related investments, to offset other projected reputational/other congestion risks

Commercial interest/discount rates expected to range at 5-7% as optimum based on historic estimates and macroeconomic forecasts.

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Projecting Future Demand in Scenarios A, B and C

Testing Future Demand in Scenarios 1,2 and 3

Suboptimal Market Demand for Various Segment Opportunities

Vessel Demand against Vessel Supply and Competitor Analysis


Projection of vessel technology size able to demonstrate existing growth significantly over time.

Existing vessels will honour service schedules as provided in Lloyd’s List and other data in forecasting future market demand.

Limited existing competitors/African/Southern hemisphere comparable suppliers exist as per Report 2’s market competitor analysis

The need to divide vessels by size category, to consider optimal demand use beyond the initially proposed floating dock limitations

The need to consider suboptimal usage of the floating dock - i.e. 2-3 vessels repaired/maintained simultaneously.

4: Conclusion and Recommendations.

In conclusion, following a global and African review of the potential ship repair, building, maintenance and conversion/upgrade market industry and significant decision to invest in a giant neo-Panamax floating dock, is highly probable to be viable over the projected 25-30 years, given the stated model and various scenario assumptions and parameters. A growing, favourable consensus exists from existing sources among various relevant core stakeholders including shipping companies, academia, Municipality and others of the inadequacies of both existing African/Southern Hemisphere port performance and ship repair facilities; along with other competitor alternatives. Whilst certain companies have expressed scepticism over any proposed floating dock facility, given Indian Ocean Rim competitiveness of equivalents in the United Arab Emirates and Asia; these have conceded the need for at least one facility for emergencies and repairs. Others however, have indicated far more interest and enthusiasm to the point of even contemplating their own, given certain port’s strategic position as a global hub and transhipment port; certain comparative/absolute advantages and the high costs of servicing vessels within Europe. Primarily as a consequence of increasing technological trends favouring larger vessels and cargo capacity rather than endogenous national or global economic patterns, the average number of many port vessel callers has decreased over time. Yet the number of vessels is ultimately expected to stabilise, given increasing economic confidence and basic cargo requirements for supply chains’ just in time production.

However, projections indicate rapidly declining numbers of vessel callers entering many ports, as vessel sizes and trade uncertainty increase before achieving market stability. Other vessel opportunities have been highlighted from those scheduled for maintenance, conversion to comply with increased environmental sustainability, legal (e.g. IMO sulphur cap) competitive pressure and technology trends. This report further recommends emphasising the employment, contribution to GDP and other socio-economic advantages as motivations to secure government, financial and other means of support. Provided potential adverse socio-environmental and other externality costs; legal, market competitor and other risks; including climateproofing and futureproofing against any projected disruptions as much as feasibly possible; this report considers from a microeconomic perspective and macroeconomic/Operation Phakisa perspective, a neo-Panamax dock satisfying stakeholder requirements, of sufficient size, capitalising on existing shipyard’s capacity is viable.

It is also strongly recommended that this report would further benefit from extensive stakeholder consultation to ascertain true market demand, economic feasibility and acceptability, testing the assumptions and parameters. It is particularly advised to contact as many major shipping

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companies as possible as the most significant clients; maritime safety agencies, port agents, maritime clusters, investors, local academia, professional associations for marine engineers, naval architects, ship repairers, builders, local host cities, navies, yacht clubs and boatbuilders, shipping line and agent professional associations for additional input.

Report prepared by Jack Dyer, principal maritime economist as an abbreviated version for a commercial client.

References

Cole L, 2013, “IDSAF Caribbean Dry Dock Presentation,” Kingston.

Department of Transport, 2013-2018, “Transport Statistics Bulletin,” Pretoria.

Lloyd’s, 2019, “Lloyd’s List,” Lloyd’s London.

Nemai Consultants, 2018, “Mossel Bay Repair Dock Report for Transnet,” Nemai Consultants, Mossel Bay. SAMSA, 2012, “Vessel Construction and Repair Industry Profile in South Africa, 2012, SAMSA Report, Durban.

Transnet National Port Authority 2005-2018, “Annual Reports,” Transnet, Johannesburg.

Transnet National Port Authority 2005-2018, “Consolidated Movement Report,” Transnet, Johannesburg.

Transnet National Port Authority 2005-2018, “Vessel Statistics,” Transnet, Johannesburg.

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Documents

ABBREVIATIONS AND ACRONYMS dock global... · Web viewExisting de-ballasting time is four hours, comparable to international standard averages of 2-6 hours. It hosts 1 50 ton, 1 24