COLUMN | Quick Updates, part two: Oh Crist! Is it Costamare at PaxOcean? Rawabi fleet hits 200 and carries on growing [Offshore Accounts]

We have previously highlighted that, despite self-interested prognostications from industry leader Tidewater and its multimillionaire CEO, offshore support vessel (OSV) newbuildings are increasingly attractive.

Day rates are high, the order book is very low, and the global fleet is ageing fast. Tidewater’s own fleet of 220 vessels now has an average age of over 12 years, with offshore vessel working life usually estimated at 20 to 25 years maximum.

What began as a drip-drip with the first order of two new platform supply vessels (PSVs) in China by new player Hercules Supply in late 2023 is fast increasing. At the time we observed:

“The newbuildings should cap second-hand PSV prices and put Tidewater on notice that operating the world's largest fleet of middle-aged vessels might not be a long-term strategy. Who's next to order?”

Since then, surprise! We have seen numerous ocean energy support vessels (as they are now known) ordered out of Norway, including four firm orders in China by John Fredriksen’s Seatankers, and others by Rem Offshore, Island Offshore, Agalas and Eidesvik together, and from WEC, a company associated with Norwind’s investors.

Three weeks ago, Norway’s Østensjø Rederi ordered added to the order book with another ocean energy support vessel to be built at Astilleros Gondan in Spain.

The biggest offshore order came in June, however, from Greece’s ocean shipping legend Evangelos Marinakis at Fujian Mawei Shipbuilding in China. His Capital Offshore placed an order there for four firm and four optional diesel-electric, DP2, Breeze-design PSVs, putting Tidewater firmly on notice that their oft-repeated claims that new build PSVs will cost US$65 million apiece are nonsense.

The offshore oil and gas order book is still dwarfed by the one hundred or so windfarm service operation vessels (SOVs) and windfarm commissioning SOVs (CSOVs) on order, despite the lack of profitability and very low margins in that highly competitive renewables sector.

But now we see and hear more drips. How long before the floodgates open for offshore orders?

Oh Crist: Maersk builds in Poland for Cenovus

In part one of this piece, we saw how Maersk Supply Service has just announced a newbuilding field support vessel to be constructed at Crist shipyard in Poland. Again, there is more confidence to commit to building a high-specification light construction vessel than to replacing the bog standard PSVs and small anchor handlers that make up the bulk of the offshore fleet.

This newbuild vessel for Maerk Supply will be built by Crist in Gdynia, Poland and will be delivered in 2027, when Maersk Supply will have been absorbed into DOF as per of the two companies’ 65-vessel, US$1.1 billion fleet merger.

The ship will be named SeaDragon and will be 110 metres long, built to the MMC Ship Design and Marine Consulting 995L SBC hull design, with full DP3 and ice class. SeaDragon will be certified for a total count of 164 personnel on board and will be fitted with a walk-to-work gangway to enable the ship to connect to the SeaRose floating production unit, or the White Rose Field platforms.

SeaDragon will feature diesel-electric, battery hybrid power systems to reduce emissions, and will be fitted with two 1MWh batteries. The ship will feature three azimuth thrusters and a tunnel thruster forward. The Polish designers hope the battery hybrid systems will reduce fuel consumption by around 35 per cent. The ship can also operate on biodiesel if it is available.

This is a high-specification unit worthy of a remote, harsh environment operating location. Credit to Cenovus for being far-sighted enough to charter a newbuild for the remaining life of White Rose Field.

Whilst SeaDragon may be one of the biggest single vessels in the new wave of newbuilding offshore vessels, this Maersk Supply order at Crist was certainly not the biggest order to date. That honour lies with the buyer of up to ten ships in Zhoushan, China.

PaxOcean takes ten

Last Monday, the PaxOcean Group, owned by Malaysian tycoon and casino owner Robert Kuok, had joyful news. The company said it was “delighted to announce the signing of a newbuilding contract with a leading Greek shipowner on September 11, 2024. This groundbreaking agreement marks a significant milestone for both companies, ushering in a new era of collaboration."

"Under the terms of the contract, PaxOcean will construct up to 10 state-of-the-art, multi-purpose service vessels (MPSVs). These exceptional vessels, boasting a 5,000 DWT capacity and DP2 dynamic positioning, will incorporate the latest advancements in offshore vessel technology.

"The vessels will be built at PaxOcean’s yard in Zhoushan, China, with deliveries scheduled from the third quarter of 2026 onwards. Designed by the renowned Salt Ship Design of Norway, these MPSVs will stand out for their modern design and exceptional fuel efficiency, setting a new benchmark in the industry."

This order is huge news and industry publication TradeWinds was quick to suggest that the buyer was again Greek ocean fleet shipowner Costamare. At the end of 2023, we reported how Costamare and its controlling Konstantakopoulos family bought three large North Sea PSVs: two from Norways's Vestland Offshore, being the 2011-built, 5,400DWT Solvik Supplier and 2011-built, 4,900DWT Vestland Artemis, which are both working in the North Sea, and also the 2012-built Evita II, which was owned by Ugland Offshore, but managed by Vestland.

What is this? A PSV with an unnecessary crane? Or a light construction vessel with unnecessary underdeck tanks?

It is not clear to me whether the PaxOcean ships will eventually be delivered with the subsea cranes. If so, then all the bulk and mud tanks will be unnecessary, and more resources will need to be spent on moonpools and ROV hangars.

Otherwise, then they will make fine large PSVs, but the concept seems politely to me to be a little muddled at this stage. Either build a decent PSV without a crane and save millions, or build a decent offshore construction vessel and ditch all the mud and bulk tanks and their pumps and pipes.

What has been ordered at PaxOcean seems to sit awkwardly between the two categories, but this is perhaps not surprising given Costamare’s lack of experience in offshore market, if indeed Costamare is the buyer.

My record of speculation is so bad that I will wait for a definitive press release from Costamare itself to avoid further embarrassment. Like Jon Snow in Game of Thrones, I know nothing.

In the Breeze?

The same week also saw Breeze Ship Design announce that two of the Capital Offshore ships at Fujian Mawei would be similarly multi-useless multi-purpose.

Breeze said it had been awarded a contract by the yard for the design of two new MPSVs for Capital Offshore. These will be built to the Z 4423 MPSV design and will be 88-metre-long vessels with battery hybrid propulsion, 1,000-square-metre work decks, and accommodation for 60 people. The vessels are also each designed with a moonpool, a subsea crane, and a helideck, which Breeze said, "makes the vessel flexible and allows it to be used for different operations within the offshore and energy segment."

Again, I don’t see this. Buy wellies or buy trainers depending on the activity you undertake, but please, don’t create a hybrid Nike Air Wellington Boot for both running performance in a sprint and for walking in thick mud. These compromises are rarely happy. Different roles need different vessels with different equipment.

However, it is interesting that outsiders to the offshore industry seem to have more confidence in newbuildings than do insiders, who are busy trying to constrain supply to raise prices (Tidewater) or have only just completed painful restructurings (DOF, Solstad, Chouest, Bourbon, and the rest).

This is true for most, except one Saudi owner.

Rawabi – the first orderer and nearly the largest?

We previously observed a year ago that Rawabi Vallianz Offshore Services was the first owner of the cycle to order new offshore vessels, when it capped a decade of buying vessels out of China with a new order in Batam at its own yard.

The company ordered a 70-metre-long AHTS with a bollard pull of 120 tonnes and DP2. Rawabi has since expanded its newbuilding programmes with nine AHTS vessels, one maintenance vessel under build in China, and one standby safety vessel on order at Marinteknik Shipbuilders in Singapore. Rawabi has doubled down on the small vessel segment used by its primary client, Saudi Aramco in Saudi Arabia.

Because Rawabi flies under the radar in terms of publicity and announcements, and builds at many, often second tier yards, it is hard to gauge exactly how many ships it has on order.

We have seen reports that Rawabi is building six small AHTS, believed to be of around 70 tonnes bollard pull and 1,900 DWT, at Jiangmen Hangtong Shipbuilding in China, for delivery between this month and November 2026. The same yard is also believed to be building a maintenance vessel for the company. It also has newbuildings in Southeast Asia.

Malaysia’s Shin Yang Group announced earlier this year that it has three AHTS vessels under construction for a client believed to be Rawabi for the value of US$30 million, as per The Star newspaper. This includes the 6,700bhp (5,000kW) Rawabi 213 and two sister vessels.

Industry sources report that the owner, not the yard, supplied some of the key equipment, which explains the low value states by Shin Yang. One ship will be delivered shortly, the other two other AHTS vessels in 2025, we understand.

Rawabi has been relentless in building up its fleet, which now stands at more than 200 offshore vessels of all categories and seemingly every type, a total fleet size very close to that of Tidewater, which has around 214 OSVs of all categories in its fleet, but a focus on much larger and higher specification units.

Tidewater is not ordering, but Rawabi has continued to invest. Will Rawabi surpass Tidewater in fleet size soon?

The drips just get louder.

Background reading

Part One of this week's Quick Updates series can be read here.