Signed Contracts for the Construction of Two Tankers

At the 3. Maj Shipyard today, contracts were signed for the construction of two tankers for the transportation of chemicals, oil, and petroleum products, each with a capacity of 51,800 tons, which the shipyard will build for the shipping company Uljanik plovidba from Pula.

The contracts were signed by the presidents of the management boards of 3. Maj and Uljanik plovidba, Željko Starčević and Dragutin Pavletić, in the presence of the Deputy Prime Minister and Minister of Economy, Labor, and Entrepreneurship, Damir Polančec. The contracted price for the construction of the first tanker is $52.2 million, and for the second, $54.1 million. The tankers will be 195.3 meters long, 32.2 meters wide, and 17.8 meters high, and will be powered by engines from the 3. Maj Engine and Crane Factory, each with a power of 9,650 kilowatts. They will be built under the supervision of classification societies Det Norske Veritas and the Croatian Register of Shipping, and 10 percent of the construction will be co-financed from the shipbuilding support program for domestic shipowners. According to the agreement with the European Commission (EC), they can use existing state subsidies until the completion of the shipyard’s privatization. The delivery deadline for the first tanker is May 2010, and for the second, August 2011.

Polančec emphasized that now, considering the crisis, it is rare to witness the signing of shipbuilding contracts anywhere in the world, and that soon contracts for the construction of two ships for the Zadar-based Tankerska plovidba will also be signed at 3. Maj. When asked about the appointment of a new Supervisory Board (NO), Polančec replied that part of the former NO participated in the preparation of the contracts, but they believed that the situation had stabilized, so they submitted their resignations. Their resignations were accepted, but consultations about the new composition of the NO are still ongoing and should conclude by the end of next week. Speaking about negotiations with the EC, Polančec stated that the last meeting of the preparatory phase should be held on February 23, after which tenders for privatization should be announced. One political issue remains in the negotiations, which will not be made public before an agreement is reached, Polančec said, emphasizing that he is confident that the tenders will be published by March 15 and that privatization should be completed by September this year. Polančec noted that entrepreneur Danko Končar has expressed interest in purchasing the shipyard and has presented a privatization model, under which a domestic consortium would be established, including domestic shipowners, suppliers, and banks.

Members of the consortium could find their interests within it without investing significant money, but they could contribute their expertise. The Deputy Prime Minister also stated that privatization should enable a new development cycle and raise capital for necessary technological renewal and continued production. He pointed out that current subsidies are not acceptable to the EU and that the obligations of all state shipyards now exceed 8.2 billion kuna, of which about 4 billion kuna are due for payment. In response to a journalist’s question, Starčević stated that 3. Maj had a loss of about 250 million kuna last year, during which 5 ships were delivered, and that the financial plan for this year has not been completed. Last year, 3. Maj received about 82 million kuna in state subsidies, and this year it expects around 80 million kuna, he said. (Hina)