Saudi Aramco's JV starts work on Ras Al-Khair shipyard

A joint venture involving Saudi Aramco has started construction work on the Gulf’s biggest maritime yard at the Ras Al-Khair site in eastern Saudi Arabia.

International Maritime Industries Company (IMI), the joint venture, started operations after reaching an agreement for a loan from the Saudi Industrial Development Fund (SIDF), UAE-based consortium member Lamprell said in a statement on Friday.

“The construction process at the site is underway with dredging and associated activities in progress. The partners have made significant progress in creating the business infrastructure, including the management organisation, the internal governance structure and the detailed business plan,” the statement said.

In May 2017, Reuters reported SIDF had agreed to provide $1 billion in financing for the SAR 20 billion ($5.3 billion) project.

Other joint venture partners include the National Shipping Company of Saudi Arabia (Bahri) and South Korea’s Hyundai Heavy Industries Co.

In the first capital contribution to the project, Lamprell invested $20 million last year and its anticipated total equity contribution over the construction period is up to $140 million. Each partner will contribute capital in accordance with their pro rata share and in line with the original drawdown schedule.

The shipyard, which is expected to be fully operational in 2022, has an annual capacity to manufacture four offshore rigs, over 40 vessels including three VLCCs, and service over 260 maritime products.