Restructuring Zhejiang Shipyard makes effort to return to businessRestructuring Zhejiang Shipyard makes effort to return to business

The Chinese shipbuilder hosted a naming ceremony for a $15m AHTS vessel named Rawabi 201 for Singapore’s Vallianz Holdings, and launched a PSV for Shanghai Salvage Company’s subsidiary Shenzhen Huawei Offshore. The new ships were built to Sinopacific’s inhouse design series of SPA60 for the AHTS vessel and SPP35ML for the PSV.

The AHTS vessel is the first of four units to be built for Vallianz following an order win in August 2014. The original delivery schedule for the four ships was between 2015 to end-2016, but the difficult market has led to delays in the handover dates.

Zhejiang Shipyard also landed orders from Huawei Offshore in July 2014 to build five ships – two PSVs of the SPP35ML design and three AHTS vessels of the SPA85L design. The latest PSV launch is the first of the five units, as the original delivery schedule of handing over all five ships by end-2016 has also been delayed.

Zhejiang Shipyard faced troubles since the start of this year when Evergreen Holding Group, parent firm of Sinopacific, encountered cash flow issues. By 14 April 2016, a court in Fenghua city in Zhejiang province placed Zhejiang Shipyard under bankruptcy restructuring. The embattled company then adopted a series of austerity measures to streamline the organisation, improve the management system and secure resources to resume yard operations.

Following the collapse of oil prices and the lingering supply glut in the offshore sector, the OSV focused Zhejiang Shipyard, as well as almost all OSV yards globally, were badly hit by a sudden dearth of new orders and owners requesting to delay deliveries.

Zhejiang Shipyard was once the leading Chinese shipbuilder specialising in the constructing of offshore vessels with its well-known inhouse designs. Since its establishment in 2003 until end-2015, Zhejiang Shipyard had delivered 207 ships, including 151 OSVs.