Sailing out of troubled waters Vyborg Shipyard

SAILING OUT OF TROUBLED WATERS

With its long history, experience and readiness to face future challenges, Vyborg Shipyard remains a leader in the Russian shipbuilding industry with a global impact. Mr Alexander Solovyev, general director, unveils their current projects and future plans in an interview with Vanja Švačko.

Being one of the oldest industries in the world, shipbuilding is a seasoned survivor through the history of economic slumps. Nevertheless, it is an industry that has been severely hit by decreased demands on the market and production over-capacity. At the entrance of the Gulf of Finland in its north-west region Russia is one of the largest shipbuilding companies Vyborg Shipyard JSC, established in 1948. Although known for its reputation for early completion of many projects in the past, Vyborg Shipyard was severely affected by the deepening of the crisis to the point that its production came to a standstill.

Making headway

In 2012, Vyborg Shipyard became a member of the United Shipbuilding Corporation (USC), a Russian open joint stock company, whose main goal is to preserve, enhance and develop national potential in shipbuilding.

“As a government corporation USC includes almost 90 per cent of similar companies in Russia,” explains Mr Solovyev, “which makes Vyborg Shipyard a state-owned company. But what distinguishes us from the other shipyards in Russia is the fact that we are not involved in military shipbuilding. The sphere of our interest is production of vessels for civilian and commercial shipping. This position within the USC is our biggest advantage because our commitment to the clients is not restricted by the terms and conditions of the military.”

Membership in USC has paid off straight away. The company has received contracts

for the construction of three icebreaking supply vessels, which was a return to its original business roots. “We have always been specialised in the construction of platform supply vessels of arctic class, supplier standby vessels etc.,” says Mr Solovyev.

Today Vyborg Shipyard employs more than 1500 people who work on the construction of offshore oil and gas drilling platforms for the open seas and various kinds of vessels of deadweight tonnage up to 12,000 tonnes. “We are proud to be the most experienced Russian shipyard in offshore construction. The latest proof is our cooperation with Samsung Heavy Industries in constructing offshore drilling platforms for Gasprom,” states Mr Solovyev.

In the last 30 years, the company has worked on the modernisation of drilling platforms as well as pioneering state-of-theart features for the drilling devices. Apart from semi-submersible platforms, the company also builds jack-up drilling floating platforms that operate in the open seas. Additionally, Vyborg Shipyard performs repair and upgrade of these platforms and offers unique modernisation services (lifting), requiring faultless calculations and performance. The company also produces steel, with an annual capacity of 20,000 tonnes, and aluminium alloys for shipbuilding.

“Modernisation of our production facilities is pivotal for us. In 2010 we purchased modern painting chambers, the biggest in the north-west of Russia, for the large blocks up to 300 tonnes. We have also introduced a prefabrication line for the steel production,” says Mr Solovyev. The company has also finished construction of the new dock and barge that will eliminate restrictions of ship width and further enhance its independent production.

In the offing

Vyborg Shipyard cooperates closely with the world leaders in the shipbuilding field. Its unique geographical location has defined its strong presence in the Scandinavian market. Despite the fact that the current crisis forces the company to concentrate on the domestic market (almost 90 per cent of orders are through government contracts), Vyborg Shipyard has no intentions of forgoing international markets. Instead it keeps close relationships with foreign partners and takes part in ongoing shipbuilding tenders. Parallel to this the company is planning to expand its icebreaking programme and expecting to get orders for up to five more icebreakers till 2020. Part of its two year plan is also to attract investment credits of Vnesheconombank, which would further allow investment of about RUB 2.5 million in modernisation of the shipyard.

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“Today our production is back to normal thanks to the membership in USC, and our plan is to have a turnover of about RUB 7.5 billion,” explains Mr Solovyev. “However, due to the complicated economic situation in the global market, the idea that we are actively pursuing is to focus on modernisation of our own company. We know that our future growth will be based on improving what we already have, rather than on acquisition of the new businesses.” Those improvements will include reconstruction of the environmental protection system, the result of which will be minimum harmful discharge. The company will invest RUB 100 million in this project. However, the environmental, health and safety program that the company has been implementing from the Soviet days was one of the first in Russia and is still highly effective.

Vyborg Shipyard relies a great deal on building partnerships when it comes to shaping its future. Part of the plan is to stay on track with well-known clients and partners such as Arctech Helsinki Shipyard and Samsung Heavy Industries. “The main offers to our clients are based on common projects with Korean shipyards. We are keeping very close connections with companies such as Gasprom and Rosneft, hoping to be involved in some of their future projects,” adds Mr Solovyev. n