Dung Quat Shipyard rides out COVID storm

14-Jul-2020 Intellasia | VNA | 6:02 AM Print This Post

The COVID-19 pandemic led to a downturn in global supply chains and demand for goods transport, which hit maritime shipping and shipbuilding hard worldwide. The Dung Quat Shipbuilding Industry Company Ltd (DQS), however, may be the exception, having received a host of orders locally and overseas this year.

Opportunities in difficulties

The disease outbreak triggered a major reduction in demand for goods globally, while production was frozen and maritime vessels forbidden from sailing during the social distancing period. Halted operations at seaports and manufacturing plants coupled with tumbling oil prices and lower demand for energy saw the oil carrier fleets of many companies also cease working or only working perfunctorily.

Against the trend, DQS saw orders from Vietnamese and foreign customers pile up.

On June 24, the FPU Dai Hung 01 oil rig, belonging to the PetroVietnam Exploration Production Corporation (PVEP POC), was towed to the company’s dock for maintenance. The only semi-submersible structure in Vietnam, the oil rig is 108.2 metres long and 67.36 metres wide with capacity reaching 9,880 tonnes. DQS is set to clean all of its immersed sections during the maintenance, which will last for only two and a half months.

Despite being a subsidiary of the Vietnam Oil and Gas Group (PetroVietnam), DQS had to bid for the contract and prove its capacity. It had performed an overhaul of the FPU Dai Hung 01 before, in 2014. In May 2015, it completed work ten days earlier than scheduled, saving 3 million USD for its client.

DQS’s foreign orders doubled those of the two previous years taken together in the early months of 2020 the result of its longstanding efforts and the assistance of PetroVietnam.

Overcoming difficulties and seeking customers

According to Nguyen Anh Minh, DQS vice director, since 2017 the company’s executive board and council members have prepared the necessary conditions to reach overseas markets, including quickly completing paperwork for the Dung Quat dock to berth foreign vessels and building a network of agents connecting with foreign customers, particularly those with oil tankers and container ships.

When COVID-19 broke out, DQS leaders sat down to discuss different scenarios, including the worst-case. They agreed to maintain production at all costs and established a reasonable price framework. As such, even during the pandemic, the company took in foreign ships to repair, with crew members quarantined onboard.

Understanding that closed borders meant a shortage of materials, DQS promptly purchased enough for a number of projects.

Minh said foreign ship owners often bring experts the first time they use DQS’s services, but trust increases after that and the number of experts decreased, reducing the pressure on COVID-19 quarantine.

In the latest news, following the arrival of the Dai Hung oil rig, DQS will receive a Panama-flagged Guyanese Light Patrol vessel, and in the second quarter will take in a Marshall Islands-flagged ship.

DQS was established in 2006 as a member of Vietnam Shipbuilding Industry Corporation and was transferred to become part of the PetroVietnam in July 2010. Right from the start, the company has focused on building its management system and human resources to offer qualified shipbuilding and repair services./.



Category: Business, Vietnam

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