MARINE SERVICES firm Mainport is investing $36 million (€27.6 million) to build three supply vessels which will support seismic survey ships searching for oil and gas deposits.
The bulk of the financing for the construction of the ships has been provided by Dutch bank ABN Amro, with a syndicate of Irish investors assembled by Westboro Finance in Cork providing $5 million in mezzanine, or short-term, financing.
The three ships, which will provide support services for an unnamed client carrying out off-shore seismic surveys around the world, are being constructed at Shin Yang Shipyards in Malaysia, and will be delivered in mid-2013.
“It was hugely challenging getting financing for this deal,” said Dave Ronayne, chief executive of Mainport. He said both Bank of Ireland and Ulster Bank passed on the deal, while US financiers considered the deal too small.
Mr Ronayne said the contract was “transformative” for Mainport and it is negotiating with other offshore seismic firms which could lead to it investing in more new ships.
Oil and gas exploration companies are increasingly looking to develop off-shore fields at depths which would previously not have been considered commercially viable. Mainport now has four older support vessels working in Angola, Brazil and the North Sea.
The seismic survey ships remain off-shore for as long as possible due to the time and cost involved retracting the high-end “streamers” which can trail up to five miles behind the mother ship while they survey the ocean floor.
Mr Roynane said political developments such as the EU’s potential ban on Iranian oil imports were encouraging oil companies to explore farther off shore.
The three new Mainport ships – Mainport Cedar, Mainport Pine and Mainport Tara – will supply the mother ships with fuel, water and provisions, and facilitate crew changes.
The ships will be modified to carry up to 900 tonnes of fuel.
Mainport will also provide “chase” services ensuring the path in front of the survey vessel is free of obstructions or shipping. Slowing down or changing course can cause the streamers to become entangled.
“The survey vessels can charge the oil companies $150,000 to $200,000 a day so that can prove very costly,” said Mr Ronayne.
The new business will add €16-17 million to Mainport’s current turnover of €35 million, said Mr Ronayne.
Mainport was founded in 1957 as Ronayne Shipping by Finbarr Roynane, Dave Ronayne’s father.
Headquartered in Cork, the bulk of its business is now international, although it continues to provide stevedoring or unloading services at Cork, Foynes and Drogheda ports.