Ferrostaal in R1,7bn Cape oil projects :: Namibia Internet Gateway cc ::

Articles: Ferrostaal in R1,7bn Cape oil projects

Posted by admin on Thursday, March 23, 2006 - 07:58 AM

CAPE TOWN — German-based industrial giant MAN Ferrostaal has unveiled a major investment in SA with the establishment of two facilities in Western Cape worth R1,7bn to service the growing offshore oil and gas industry.
Chris van Gass

The two projects — an offshore fabrication yard at Saldanha Bay and a service and refurbishing hub at the port of Cape Town — will go some way towards fulfilling the company’s €3bn offset agreements with government, as part of its participation in the arms deal. MAN Ferrostaal chairman Matthias Mitscherlich announced the developments on the first day of the Oil Africa 2006 conference, saying the direct investment in both locations amounted to R220m. The balance of R1,5bn would be “indirect” investment that would see operational equipment, at present underutilised or at risk of being scrapped, relocated from other parts of the country and being put to full use at the new locations. The projects would inject much-needed impetus into the Western Cape economy and were expected to create at least 720 new jobs in Saldanha and another 700 in Cape Town, with indirect job opportunities for between 12000 and 14000 people, Mitscherlich said. He said the projects were directly aligned to government’s Accelerated and Shared Growth Initiative for SA. He also said that much-needed skills development in terms of the offset programme would be offered, as would skills transfer from the MAN group, which had 30 years’ experience in the oil and gas industry. “In addition we have the cream of South African industry who are involved in the project,” said Mitscherlich. These include Grinaker LTA, DCD Dorbyl Heavy Engineering, DCD Dorbyl Marine, SA Five Engineering and Globe Engineering Works. Mitscherlich said he was confident the project would be completed in 10 months. Brian Blackbeard, of Atlantis Marine Projects, MAN Ferrostaal’s South African partner, said that at present SA had only 6% of the potential market in the offshore oil and gas industry, due to lack of infrastructure and coordination of logistics. With the new facilities local companies could now ramp up capacity and, through more aggressive marketing, increase their stake in this sector. Blackbeard said the fact that new oil fields were springing up in west Africa meant increasing demand for new platforms and maintenance of existing ones. He said the facility would immediately be able to offer business as existing yards worldwide did not have spare capacity. “The advantage of the two projects is that they offer new capacity on African soil, geographically the closest facility compared with Asian, European, Mexican and European facilities.” Blackbeard said the potential turnover for the first phase at Saldanha, starting next year, was R500m, with a projected turnover in Cape Town of R340m. After completion of an environmental assessment for the second phase of the project, the R500m turnover could double. Blackbeard said the Saldanha unit would be using 1000 tons of marine-grade steel a year and, as a domestic user, would be charged a price lower than the international unit price. Tasneem Essop, Western Cape MEC for environment, planning and economic development, said Western Cape had been waiting for a “long time” for this project to get off the ground and “it bodes well for the province to establish the oil and gas sector as a critical growth sector”.

· 117 Reads ·