€55 million investment to transform shipbuilding site into service hub for oil and gas industry

A €55 million investment is set to transform the ex-Malta Shipbuilding site into a service hub for the oil and gas industry, directly employing 160 people while paving the way for Malta to benefit from growing business in the Mediterranean region.

The government had sought bids for the concession of the 175,000 square metre site for its development as a maritime hub. Twenty-eight expressions of interest were submitted, followed by six bids, and last January, Ablecare Oilfield Services Group – a Maltese company established in 2001 – was announced the preferred bidder for the site.

Plans seen by The Malta Independent on Sunday suggest that the entire Malta Shipbuilding site is to be allocated to the Ablecare Group in what should be a 45-year lease.

Ablecare was actually the only bidder which wanted to use the entire site, although all other bidders applied for the bulk of the area, including the dock, the massive hangars, and all the quay space. However, the Privatisation Unit had originally recommended that the company should not be allocated the entire lot, leaving the remainder free for other uses.

The company aims to develop a top regional service hub for the oil and gas industry, aimed to attract business from rigs in the Mediterranean and beyond. The site would not only include a rig-servicing centre but also a learning and training institution offering internationally-accredited courses, complete with student accommodation for both local and international students.

The quays would act as rig stop facilities and equipment lay down area, and three open sites would serve as equipment storage and logistics facilities. Two other open areas would serve as a drill pipe yard and as a riser (the piping used to deliver oil or gas upward) preparation area.

A part of the site, where the former Freedom Press building lies, will be developed into an oil and gas marine engineering hub, which is to be fenced off from the rest of the area.

The hangars are to be used as fabrication, inspection and repair workshops for the petroleum, marine and subsea industry, and the facilities on site would also include a liquid mud plant, which is used to prepare, treat and store fluids used in drilling operations.

One of the competitive advantages the site can offer is the establishment of a free zone area, which would allow the expensive equipment used in drilling operations to be stored without the need to pay tax or duty.

The company is to invest €55 million over and above the payment of the lease, and the government’s share of enterprise value over a 10-year period stands at €42 million.

Ablecare pledges to transform the site into a state-of-the-art environmentally-friendly facility to meet present demands and standards.

The project will also involve the cleaning and decontamination of the inner Marsa sea basin, which is one of the most heavily-polluted parts of the Maltese coast.

Credits: First published in the Malta Independent online.  



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