Shipping company expanding business

Azov-Don Shipping Company plans to invest some $340 million into the Group’s fleet renovation till 2012. By that time the Group of Companies intends to form a powerful shipping company capable of operation in the Mediterranean and Northern Basins. According to the Group’s forecasts, the fleet’s total deadweight is to reach 500,000 tonnes with container fleet accounting for 10,000 TEU.

Fleet renewal

In 2008 the fleet took the delivery of two 6,000-dwt vessels of Volga type ($16 mln each) and two 5,000-dwt vessels of Volgo-Don type ($10 mln each). A contract for acquisition of two more Volga-type vessels is to be sighed in the nearest future. All in all, the program envisages acquisition of 20 vessels for $100-150 million. “Part of the Group’s fleet (worn-out and outdated vessels) were sold and the raised money was invested into acquisition of new vessels and modernization of the existing ones”, tells Aleksandr Gorbatko, deputy Director General on shipbuilding of Azov-Don Shipping Company.

The company has sighed a contract for construction of a series of seven 7,000-dwt Tanais-type vessels costing $16 million each. The project’s total value is to make $112 mln. The first m/v of the series was built and put into operation at Navashinsk shipyard. Nowadays it transports containers between Rostov-on-Don and Istanbul. In November 2008, the second vessel of the series will be launched by Volgograd Shipyard OJSC. The construction of the rest five m/v will be completed by the beginning of 2010. The negotiations are in progress on construction of three more vessels of the series.

All in all, under the program on fleet construction in 2009 - 2012 it is planned to build 10 new 10,000-dwt vessels.

Another target of the fleet renovation program is the conversion implying construction of new vessels with application of the elements from the existing vessels (so-called “donor vessels”). Conversion of fourteen 5,000-dwt Volgo-Don vessels is to be completed by 2011 ($10 mln each). That will raise the competitiveness of the vessels at the global shipping market. Deep modernization and re-equipment makes it possible to extend operation by 10-15 years.

Logistic hub

The Group’s development strategy envisages creation of a powerful transport-logistic company including not only shipping business but a multimodal transport-logistic hub (MTLU). Within the framework of this program the shipping company signed a contract with Rogge Marine Consulting GMBH (Germany) for designing of container terminal facilities. Besides, a dead-end track is to be built at the territory of Azov-Don Shipping Company in order to unload the seventh open track and serve some 300 wagons per day.

The development of transport system will mainly depend on implementation of an investment project MTLU RUP – Rostov Universal Port. The list of MTLU RUP facilities includes outer and inner water area (100 ha), approach canal and off-harbor territory, approach railway capable of handling 15 million tonnes per year (linking MTLU RUP with railway stations Zarechnaya and Kazachya, approach highways, pump and treatment stations , utilities, check-point facilities administrative buildings as well as navigation and communication facilities. The project is valued at RUR 19.9 bln with private investments accounting for 69.8% of capital investments, federal budget – 25.1%, regional budget – 5%.