Smart Holding’s Smart Maritime Group (SMG), which unites Kherson and Mykolaiv shipyards, has resumed ship repair at Mykolaiv shipyard after a year and a half break.
According to SMG’s press release, the first client after the forced pause was DELTA III, a tugboat built in 2006.
SMG specialists are performing scheduled maintenance, which includes cleaning and painting the hull, servicing the main mechanisms, including the engine and navigation system.
The owner of the tug, Delta Tag LLC from Mykolaiv, has been a regular customer of Smart Maritime Group since 2020, ordering ship repair services for its fourth vessel.
“We are accustomed to the high quality of work and professional service that our vehicles receive here. Due to military threats at sea, we cannot access other repair assets, but we still wanted to return to a proven service. Therefore, we are glad to resume the shipyard’s work, it is important to have specialists here in Ukraine,” said the company’s CEO Oleksandr Korenetskyi, as quoted by the press service.
In 2021, SMG modernized six bunkers and repaired 51 vessels and increased revenue by 17% to UAH 440 million. However, in 2022, due to Russia’s full-scale invasion, the company was forced to terminate previously concluded contracts, including the construction of two hulls for a Dutch company, a complete tugboat for a Ukrainian customer, and an agreement for the manufacture of metal structures. The Kherson shipyard was under occupation and out of the company’s control, but even after the liberation, the production facilities are under constant shelling, making it impossible to resume work. Therefore, the ships can only be repaired at the Mykolaiv shipyard.
“The Ukrainian sea is not safe, so we cannot resume shipbuilding work, our foreign customers simply cannot reach us safely. But the resumption of repairs is a good sign. Ukrainian business needs to work. This is a matter of employment, taxes, and economic sustainability. Moreover, shipbuilding is a strategically important industry for the country. And although we are a private business, we understand our responsibilities. And we are grateful to our customers who come back to us in all external circumstances. This is probably just the beginning,” said Dmitry Krasnikov, CEO of Smart Maritime Group.
The press release notes that additional difficulties were faced by the business due to government pressure on Smart Holding. The imperfect sanctions policy has blocked the work of the holding’s most profitable gas business, which makes it impossible to support the company’s other investment areas, which suffer physical and economic losses during the war. In addition, one-sided media coverage of the situation around the Holding undermines the reputation of the shipbuilders, which may affect future contracts, the press service summarized.
SMG is the largest shipbuilding holding in Ukraine. It was founded in 2009 to manage the maritime assets of Smart Holding. It unites the two largest shipbuilding companies in Ukraine: Black Sea Shipyard and Kherson Shipyard.
“Smart Holding” owns 23.76% of the Metinvest mining and metallurgical group, 95% of the shares in the Smart Maritime Group shipbuilding holding, and 99.97% of the shares in the Santis LLC trading and financial company. “Smart” also owns large assets in the fuel and energy industry, real estate development and the agricultural sector.
Ocean Shipyard (Mykolaiv) will increase production volumes and intend to take a leading position in the industry, the plant’s owner Vasyl Kapatsyna has said.
“Last year, we finally defended the legal right to Ocean Shipyard. We revived production and diversified our activities in order to maintain the main profile of the enterprise, jobs and modernize technologies. Today I set new tasks for the Ocean Shipyard’s team, namely, increasing production volumes and return of the leading position in the industry,” Kapatsyna said on Facebook.
According to him, a new governing agency has been created at Ocean Shipyard, a supervisory board, which is entrusted with the tasks of strategic planning, the development of international relations, raising investments, as well as partnership programs. Viktor Tsoklan was appointed as head of the supervisory board. In the near future, the supervisory board will focus on development strategies, foreign economic activity, and ensuring public-private partnerships in the defense industry.
“I am also pleased to say that Serhiy Hursky, a shipbuilder of a new generation, has been appointed as Director General of Ocean Shipyard. I believe that the experience and energy of Serhiy Vasyliovych will return Ocean Shipyard to leading positions. I remain the main investor of Ocean Shipyard, the largest shipbuilding enterprise in Ukraine,” Kapatsyna said.
Mykolaiv Shipyard Ocean PJSC (until April 2011 – Vadan Yards Ocean, until December 2008 – Damen Shipyards Okean, until February 2001 – Shipyard Ocean) specialized in the production and repair of container ships, tankers, tugs, barges with a displacement of up to 350,000 tonnes.
KAPATSYNA, MYKOLAIV, OCEAN SHIPYARD, PRODUCTION, SHIPBUILDING
The industrial community of Ukraine is against ordering 16 modern Mark VI patrol boats and the equipment they need for $600 million from the United States, the press service of the Ukrainian League of Industrialists and Entrepreneurs (ULIE) has said.
“The main duty of the authorities is to take care of the economic development of their own country, filling their own state budget, creating jobs at home. The orders in question only contribute to the growth of foreign budgets and stabilize the situation with employment in other states and do not help overcome crisis in our country. This is unacceptable and irresponsible,” the ULIE President, the chairman of the Anti-Crisis Council of Public Organizations, Anatoliy Kinakh, said.
In addition to ordering boats, industrialists pay attention to the purchase of imported locomotives and helicopters, which, in their opinion, could threaten serious socio-economic consequences for the whole country.
Kinakh emphasized that Ukraine has its own shipbuilding industry – highly professional production facilities, including in Mykolaiv, which are capable of building modern military boats and other small tonnage ships with a certain modernization.
“At this difficult time, the responsible government must develop both a national strategy for industrial and innovative development, and separate programs for shipbuilding, other priority areas of industry, to use all the levers to support the complex high-tech industry, starting from manufacturers’ access to credit resources, mitigating fiscal burden, changes in public procurement that would allow attracting public finances to load national producers,” he said.
Ukrainian President Volodymyr Zelensky believes that Ukraine can build warships on its own, and not just order them abroad.
At a press briefing in Ochakiv on Wednesday night following the examination of three warships returned by Russia, the head of state told reporters that a contract between Ukraine and France on the production of a batch of patrol vessels and technical support services for them is important to Ukraine, however support for domestic shipbuilding should be a priority.
“I’ll be honest, this contract was prepared before my presidency. Today I support this contract. Anyway, our own production is more important to us, [we should] support Mykolaiv and the region so that professionals, who have left because nothing had been constructed here for many years, return home,” the president said.
Zelensky added that Ukrainian Navy Commander Ihor Voronchenko presented him a shipbuilding development strategy.
“We are planning to build corvettes. We have a plan, although you know that any plan should have a real deadline and be supported by the budget,” he said.
In turn, Voronchenko recalled that Ukraine is planning to build four corvettes by 2028.
As reported, a new version of the Corvette State Program approved by the government in November 2017 provides for the construction of four corvettes for the Ukrainian Navy by 2028. The construction of the lead ship will be finished in 2022.
The shipbuilding and ship repair industries of Ukraine have good prospects for development due to cheaper metal, labor and electricity. “Of course, in order to develop shipbuilding, we need investments. It is difficult to assess the volume of such investments now. In any case, it is not about ten million dollars. At the same time, we see interest in shipbuilding and developing the industry in our country. The fact is that despite military actions in the east of the country, we have the cheapest metal in the region if to compare with Turkey or Romania, which are the closest competitors of Ukrainian shipbuilders and ship repairmen,” chairman of the Verkhovna Rada subcommittee for maritime and river transport Oleksandr Urbansky said in an exclusive interview with Interfax-Ukraine.
At the same time, he noted that the cheapness of workforce has the opposite effect: young professionals leave the country.
He added that the factories now need resources that would allow them to raise wages of such employees by $300-400, which would make labor migration unprofitable. At the same time, enterprises are ready to invest in the training and development of even very young specialists. But business also expects actions from the state. First of all, the matter concerns relevant amendments in the legislation.
The expert stressed that the adoption of the draft law on inland water transport will become a catalyst for the development of shipbuilding in Ukraine.
