Southern African Shipyards (SAS), which is building tug boats for Trans-net, is set to build two shipyards in Nigeria and is finalizing funding of R350 million needed for the first facility.
SAS chief financial officer Prasheen Maharaj said on Friday that the expansion was aimed at servicing the offshore oil and gas industry. Angola was a possible growth opportunity.
In Nigeria two sites in the Niger Delta had been identified, which “are close to the action in the oil and gas sector”. The sites, located in Port Harcourt and Warri, were already operating as shipyards, but were underproductive, he said.
The Port Harcourt facility was a naval shipyard and SAS would enter into a public-private partnership. The other was privately operated and SAS would pursue a partnership as “the best way to operate in Africa is through joint ventures”, Maharaj said.
The pilot shipyard will require funding of between R300m and R400m, which will be funded through a combination of equity, loans and grants from the South African and Nigerian governments. “We are still finalising how the funding will be structured,” he said.
SAS’s plans to expand in Nigeria and Angola are underpinned by the close ties between South Africa and these two countries developed through bi-national commissions as well as the African Maritime Charter, which was signed by ministers responsible for maritime transport in Africa in Durban last year.
SAS is being helped by Trade and Investment KwaZulu-Natal in expanding its local operations.
Maharaj said before setting up the first shipyard, about 30 Nigerians would need to be trained at SAS’s facility at the Durban harbour. They in turn would train staff in Nigeria.
Training would take about 18 months, but a low-key operation doing ship repairs could be started in a year.
Ship building would begin in two years. Besides training, a supply chain needed to be established, which Maharaj said would be set up as a cluster close to the shipyard.
With more than 4 000 ships permanently stationed in Nigeria servicing the oil and gas sector, there would be ample work, even though there were already more than half a dozen ship repair facilities in operation.
Ship repair standards in Nigeria were low and there was an inefficient supply chain, he said.
SAS is also doing a feasibility study on expanding into Angola. The company joined last year’s presidential visit to Angola.