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Ablecare assessing the use of Malta Shipbuilding site

Date: 11/02/2015

Ablecare Oilfield Services is reviewing its business model for the Marsa Shipbuilding site after it was told that its concession would not cover the whole area.

Ablecare Oilfield Services Holdings Ltd was announced as the preferred bidder for the regeneration of the Malta Shipbuilding Site into a maritime hub. It is planning to invest up to €55 million, over and above the lease concession.

Last March, 40 consortiums show­ed interest in the site and 28 collected the documents but only six went on to submit bids. One of those – Ablecare Oilfield Services Group – was for the whole of the site, with a proposal to use it for the oil and gas industry. The other five were for only parts of the site.

The Ablecare group, which has 14 years of experience in this field, specialises in the oil and gas industry. Once developed, the site will be a centre for oil rig maintenance, storage of heavy machinery and equipment as well as logistic support for the oil and gas exploration industry.

Ablecare Oilfield Services Group is already using part of the facility, under a temporary agreement reached in October 2013, which has since expired. Over €1 million has already been spent on upgrading the site to make it suitable for this sector.

But the Privatisation Unit recommended that it should not be given all of the 175,000 square metres. The government intends to issue a new Request for Proposals for the area not allocated to Ablecare.

“The site is large but you have to bear in mind that 25,000 square metres is taken up by the dock and roads. This leaves 22,000 square metres for storage… Put that in the context of 150,000 square metres available at Augusta in Sicily,” Ablecare chairman Paul Abela said.

The group is already specialised in technical inspections, known as riser inspection, which means that it would use the site to maintain, store and certify ­equipment.

One competitive advantage would be to establish a freezone area where the expensive equipment could be stored without having to pay tax or duty – and without the present cumbersome bureaucracy.

The company plans to add two floors to the building near Quay 2, while the so-called ‘locker’ building would be used as offices and maintenance workshops.

The company is planning to construct an oil and gas marine engineering hub, to be known as the OGME Hub, which would be fenced off from the rest of the area and would be accessible to service providers and third parties. There would be a 300-space car park, workshops for light engineering, and offices.

The group has already announc­ed that it will be setting up a residential academy for careers in drilling, which will be aimed at international students as well as local ones.

“We welcome the fact that we are the lone preferred bidder. As it is, we are only using the quays so we can only offer rig-stop services but with more area there will be other ­activities which make the whole operation more sustainable, creating work even when there are no rigs in,” he said.

“We now have to discuss with the government how much land we will get.”

Why did Ablecare go for the contract alone and not as part of a consortium? Mr Abela believes that this will give the group an advantage.

“Oil companies like to keep control of the project. If we tied up with a particular company it might alienate others. We believe it is better for us to remain neutral so we can work with anyone. This way we will be open to all subcontractors.”

He was also very insistent that the activity would not be detrimental to other activities in the area.

“I understand that people are concerned about the environmental impact, but one of Malta’s biggest rivals is Tenerife, which is a very important tourist area. The activity environment is not hostile.

“And it could quickly become another pillar of the economy. Unlike other sectors, oil and gas depends on outsourcing so it generates a lot of outside involvement,” Mr Abela said.

Source: Times of Malta

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