2017 a year of mixed fortunes for Van Oord
Pieter van Oord: “transition to renewable energy is taking shape and the construction of offshore windfarms is a growing market”
Wed 21 Mar 2018 by David Foxwell
Dutch dredging, marine and offshore company Van Oord says 2017 was dominated by difficult market conditions in the dredging and offshore oil and gas sectors, but it is doing well in offshore wind.
The volume of work in offshore wind was stable, and the market dynamic in the offshore wind sector will generate a lot of opportunities for years to come, it said, reviewing its 2017 results.
“The transition to renewable energy is taking shape and the construction of offshore windfarms is a growing market in which we have a strong reputation,” said Pieter van Oord, the company’s chief executive. The company said its financial position is sound. “As a whole, the market for our offshore oil and gas business unit was unfavourable,” Van Oord said, “mainly because of low oil prices. However, we are doing well in our niche markets, subsea rock installation and offshore pipeline installation.”
Revenue from offshore wind was stable and this business unit’s orderbook is almost full. The company has started working on major new projects. Van Oord said the dredging market had a tough year in 2017. Clients took a long time to put projects out to tender and competitive pressure increased.
Many countries are putting their efforts into stimulating their own economies and contracting their work to local parties. The conclusion of the Prorva project in Kazakhstan was one of the highlights for Van Oord’s dredging division last year. It deployed four cutter suction dredgers there to dredge a 70km-long access channel at one of the most remote locations imaginable in the Caspian Sea.
“All in all, 2017 was a difficult year for Van Oord,” said the company. “We were able to offset the lower capacity utilisation of our dredging fleet and the company’s smaller revenues without resorting to mass dismissals. Thanks to flexible employment contracts and natural attrition, we have been reasonably successful at compensating for the decline in activity.
“We are continuing to invest to ensure that our vessels are ready for the future,” said the company. “Two examples of our innovative drive are the new trailing suction hopper dredgers Vox Amalia and Vox Alexia. The shipyard where both vessels were built was granted a suspension of payments in 2017.
This resulted in a delay in delivery and the renegotiation of the contracts. The contract for Vox Amalia was then terminated to allow us to supervise the remaining work ourselves. Our unique flexible fallpipe vessel Bravenes will become operational in 2018.
The crane ship Werkendam, our first fully LNG-powered vessel, will also become operational in 2018. Our offshore installation vessel Aeolus, recently equipped with a new 1,600-tonne crane, will start working on the Norther offshore windfarm next year.“We expect our revenues to improve again in 2018 thanks to more activity in offshore wind. Our business tends to do better in a late-cycle market.
We do not expect to see the dredging market recover yet, but we do anticipate moderate recovery in the offshore oil and gas sector. We expect to produce many tenders in 2018, right across our business. We are working on major, complex tenders that are relevant to society: new ports, vast wind projects, and other large-scale energy infrastructure projects.” SOURCE: OSJ