TAS sees strong vessel demand

KUCHING: Sibu-based shipbuilder TAS Offshore Bhd (TAS), which foresees a stronger demand for offshore support vessels and tugboats, is all set to expand its shipbuilding operations to China.

Group deputy managing director Simon Lau said TAS planned to use the shipyard facilities of its partner in China to build the vessels.

“We are working on it (the China project). Once we get the right order, we will start to build,” he told StarBizWeek yesterday.

Lau said the demand for offshore support vessels was expected to increase in tandem with the increase in offshore deepsea exploration and production activities,adding that this was likely to give rise to more new orders for shipbuilders.

“The demand for tugboats has increased as the mining industries in Indonesia, particularly those related to coal and iron ore, are doing well.

“The outlook for the shipbuilding industry is getting better as compared with a year ago when people were chartering vessels.

“Now they want to invest in vessels and we have received a lot of enquiries. With more new orders expected to come in 2012, it will be a busy year for us (TAS),” he said.

Lau said TAS had on hand now 17 vessels built under contracts with a combined value of RM126.7mil.

The 17 vessels comprise 13 units of tugboats, ranging from 23m to 32m in length, two anchor handling tug supply vessels, one anchor handling tug vessel and one harbor tug.

TAS group's main markets are the Middle East, Singapore and Indonesia.

He said also under construction at TAS shipyard with different stages of completion were eight units of tugboats, one harbor tug and one landing craft. These 10 vessels are being built for sale.

Lau said TAS's earlier plan to build two or three vessels for charter had been put on hold.

TAS sold one anchor handling vessel for US$8.9mil recently.

Lau said to speed up shipyard work processes, TAS had recently ordered three gantry cranes for RM6mil. The new cranes are expected to be operational in a year's time.

For the quarter ended May 31,2011, TAS recorded a pre-tax profit of RM3.3mil on a turnover of RM40mil.

The pre-tax profit was 784% higher than the preceding quarter (RM374,000) due to provision for expected loss on a shipbuilding contract then.