Indonesian publicly listed shipping company Wintermar Offshore Marine Tbk allocated US$12.5 million for capital expenditures (Capex) in 2021-2022 to purchase five vessels.
Wintermar is a company operating an offshore oil and gas fleet of Indonesian flagged vessels.
Five more ships to serve offshore oil and gas exploration
Pek Swan Layanto, Wintermar Investor Relations, said the company spent approximately US$4 million of Capex in 2021. The remaining US$8.5 million was allocated for Capex in 2022.
“The Capex will support the purchase of high-tier vessels, such as PSVs (Platform Supply Vessels ) and AHTS (Anchor Handling Tug Supply),” he explained to Indonesia Business Post on April 17, 2022, adding that the Capex was funded by proceeds from ship sales and bank loans.
The company will purchase five additional ships in 2022 that will be used for offshore oil and gas exploration. Layanto said the company was considering several vessels, including AHTS with 5,000 brake horsepower and Platform Supply vessels with dynamic positioning capabilities.
“We do not purchase new ships, but we buy used ships, and Wintermar’s technicians can reactivate the ships,” he stated.
Many ships are now for sale, including from European and Asian companies.
In 2021, the company purchased two platform supply vessels (SPV) through the auction of a bank guarantee. One of these vessels has already been in operation, and two others are being docked in preparation for activation at the end of the first quarter of 2022.
Following the continued focus on fleet efficiency in 2021, seven vessels were sold by the end of the year, of which two were high-tier vessels and five were mid-tier vessels. So in total, by the end of 2021, the company’s fleet consisted of 38 vessels, compared to 43 vessels at the end of December 2020.
Impact and Opportunity from Russia invasion to Ukraine
In 2022, Brent crude prices are expected to trade above US$100 per barrel due to Russia invasion to Ukraine. Throughout 2021, crude oil prices have steadily gone up. Following the sudden shortage in supply caused by the sanctions against Russian oil, Wintermar said new investments in exploration are likely to increase.
In Indonesia, the government has recently announced plans to increase the budget for upstream oil and gas investment for 2022 to US$13.2 billion. Of US$12.4 billion budgeted investment in 2021, only 86% was realized.
Due to the recent war in Ukraine, there has been an urgent need to encourage upstream oil and gas investments to ensure the country’s energy security. Charter rates for offshore support vessels increased in 2021 and will continue to rise due to the new interest in drilling.
