Siem makes splash in offshore bid

A small Norwegian company in the southern town of Kristiansand grabbed the attention of the offshore service industry when it ordered 17 new vessels and acquired three modern second-hand ships valued at around $1.8 billion over the past two years.

The acquisitions make Siem Offshore one of the world's biggest owner-operators of large anchor handling and tug supply vessels - all part of a bid to provide service further out to sea.

"Most of the easy oil has been found. It started on land and then it expanded offshore in shallow waters. Now, exploration and production have reached the offshore deepwater areas," says CEO Terje Sorensen.

"To service these deepwater operations, larger units are needed, especially larger drilling rigs and support vessels taking larger loads to more remote areas. This is what we believe the future will ask for. If we go into this market, we will take a big chunk and come out as a major player," he adds.

Siem Offshore has control of a total of 40 vessels, including the 17 now under construction. The fleet includes vessels for platform supply, multipurpose field support, anchor handling tugs, well stimulation, scientific core drilling and crew boats.

Siem Offshore was established in July 2005 as spinoff of the non-subsea activities of Subsea 7 Inc. Through its own strategy and ambition it has grown 10-fold over the past two and a half years.

"It has been the right kind of investment, getting the right assets into the company, quality management and excellent chartering. When we started the company, we believed that the offshore segment would expand. During the last couple of years, the market has been historically high," says Sorensen.

With the sharp rise of the size of its fleet, Sorensen sees great potential for growth in Asia, citing the company's excellent quality as its advantages.

"China has entered the arena for building advanced offshore support vessels. We see many opportunities and I would not be surprised if we build in China in the near future," he says.

www.siemoffshore.com

(China Daily 04/14/2008 page27)