Singapore-based Sembawang Shipyard, a wholly-owned subsidiary of Sembcorp Marine and Kakinada Seaports (Kakinada Seaports), on Thursday announced a joint venture to establish and operate a marine and offshore facility in India with an investment of $375 million.

The venture - Sembmarine Kakinada Seaports Ltd. (SKL) - will develop the marine facility in the East Coast near the Krishna-Godavari and Mahanadi basin area in three phases over 3-5 years. “We are optimistic of the region’s growth in terms of shipping and offshore activities, oil and gas drilling and exploration, which will provide sustainable growth and expansion for SKL,” Sembcorp Marine Deputy President and Sembawang Shipyard Managing Director Ong Poh Kwee said.

Sembcorp Marine (through Sembawang Shipyard) would hold 19.9 per cent share of the joint venture’s initial investment of $50 million with an option to increase it to 40 per cent, he said.

SKL Director Kris. K. Nittala said the venture was poised to become a one-stop integrated offshore service facility catering to offshore vessels and merchant ships including repairs, servicing and new building of offshore vessels and ships. “Indian ships at present go to Singapore for repair with a vessel mending cost of anything between $2 million and $200 million and we are hopeful of attracting that business here,” he said.

Mr. Nittala added that the strategic location of SKL between Visakhapatnam and Chennai ports in the East Coast of India, which is next to the Gulf of Mexico held huge importance for the oil and gas industry. “Transocean Offshore International Ventures Ltd., India, a subsidiary of Transocean, U.S., will sign a ‘favoured customer contract’ with SKL to use its facilities to support its ongoing offshore drilling units,” he said.

Kakinada Seaports Ltd. (KSL) Managing Director K.V. Rao said KSL served more than 3,500 ships annually and together with the expertise of Sembawang Shipyard, it would attract ships and offshore units operating in the East Coast.

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