Marine opportunities

An Expert's View about Ships and Floating Structures in Russia

Last updated: 29 Jul 2011

The demand of the Russian market for new commercial ships and marine engineering by 2020 is estimated at 1,400 vessels, of which approximately 650 will be high-tech vessels, required for the development of the continental shelf.

Sector briefing Marine opportunities in Russia Why Russia? The demand of the Russian market for new commercial ships and marine engineering by 2020 is estimated at 1,400 vessels, of which approximately 650 will be high-tech vessels, required for the development of the continental shelf. The development of a new line of marine equipment (including offshore platforms, LNG tankers, ice-class ships and ice-breakers) for the extraction and transportation of hydrocarbons from the continental shelf is expected to become one of the major areas of activity in Russian shipbuilding in the near future. ?Half of the volume of the Russian shipbuilding industry, General information on Russian market including marine powerplants conditions can be found on UKTI?s website. The and high-tech equipment, will Doing Business Guide for Russia gives an overview of Russia?s economy, business be produced in other culture, potential opportunities and an countries.? introduction to other relevant issues. UK Trade & Investment Sector briefing: Marine opportunities in Russia Russia intends to substantially modernise its Opportunities fleet, building 791 supply, cargo-passenger transportation, safety control and other types Shipbuilding: of vessel; 6 nuclear and 26 diesel icebreakers; Each year Russian transport companies place 265 ships for the fisheries industry and the orders for ships outside Russia worth about $1 research fleet. However, to complete the plan, billion. Currently, the share of Russian Russian shipbuilders will have to use manufacturers in the total volume of orders of international suppliers of equipment and domestic ship owners remains low, less than expertise to develop the following areas: 5%. Over the last 20 years no river vessels have been constructed in Russia. - 138 R&D projects in seven technological areas, including further development of The technical level of equipment in Russian offshore engineering technologies; advanced shipbuilding leaves much to be desired. Most marine engineering; construction and repair shipbuilding methods and capital facilities are of marine equipment; development of outdated. The largest shipyards were marine electronic equipment and marine constructed more than 65 years ago and do systems; not meet modern standards. - powerplants; - navigation and other high-tech equipment; The situation remains difficult despite the fact - modern specialised metal processing that since 2007/2008 the industry has begun a equipment (for sheet sizes up to 4.5m x recovery process, resulting in the 16m); establishment of the United Shipbuilding - heavy-duty shipbuilding cranes (600. 900, Corporation (USC, in 2007. 1,200 tons); This company consolidated Russia?s largest - modern facilities for building ships of more shipyards in to several shipbuilding holdings than 80,000 dwt, 35m width; and created conditions for an increase in the - dredgers for inland water communications; domestic production of merchant ships. - new types of water transportation vessels (catamaran, hydrofoil, aircushion). UKTI has established excellent working relationships with the USC top management Development of the Continental Shelf: and has introduced a number of British marine businesses to USC. Promising in terms of development in 2011 is the market for LNG carriers - the fastest- USC currently works on a number of large growing and highest-priced area of the world?s scale projects - including the Shtokman shipbuilding industry. As the Russian Ministry offshore project development, and the transfer of Industry has indicated, LNG carriers are of the Admiralty shipyards from St Petersburg constructed abroad largely for the to Kronshtadt with an enhancement of the transportation of Russian gas, including Arctic Marine Plant at Kronshtadt. Shelf projects. Demand for such vessels now exceeds supply. Until 2020 the requirement for USC plans to establish a shipbuilding complex such LNG carriers in Russia will be about 20 in Primorsk (near St Petersburg), specialising ships with a capacity of 175,000-215,000 cbm in the construction of various types of vessels, (each one worth over $200 m). The cost of including ice breakers. The total cost of the LNG carriers for the Shtokman project alone project is estimated at nearly US$1.1 billion. may exceed $7 billion. The rate of growth in the shipbuilding industry Huge facilities with service infrastructure to of Russia in 2010 is estimated at 103.2%, and develop and transport up to 110 mln tons of oil for the period 2011-2013, the sector will grow and 160 bln tons of gas from the shelves of the at not less than 104-105%. This growth will be Far East, Arctic and Caspian Sea will be stimulated by funds available with the Federal required in the next two decades. Target Programmes in effect (till 2020) with a volume of financing exceeding US $ 20 billion. Gazprom, Rosneft, Sovkomflot development The order-book for new vessels to be built at programmes for 2009-2030 envisage the domestic shipyards shows that half of the construction of 431 ships and marine units. By added value will be produced by foreign 2030 it is estimated that there will be a companies. demand for 54 platforms and terminals in order UK Trade & Investment Sector briefing: Marine opportunities in Russia to reach the forecast volume of production and website. Find out more on UKTI?s business transportation of hydrocarbons from the opportunities service on the UKTI website. continental shelf of Russia (Rosneft will order 30 offshore platforms; Gazflot ? 21 platforms; SovComFlot ? 3 platforms), 85 specialised transportation vessels and 140 supply vessels. Leisure boats market: The Russian leisure boat market began its growth in 2000. Prior to the global economic crisis of 2008, the average annual market growth for the entire leisure boats sector was estimated at 30%. The majority of the growth in this sector is attributed to the sales of inflatable craft and medium class motor boats and yachts. While the market for luxury yachts has shown overall growth, it is a niche-oriented sector given the percentage of Russians able to afford to buy expensive leisure boats is limited. During the last several years, demand has been primarily focused on premium class leisure boats with a length exceeding 35 meters. Market leaders report considerable growth in luxury boats with the market for luxury motorboats and yachts growing considerably over the last three years. In 2005, the share of Russian buyers for all luxury yachts was 6%, today it is estimated at 25%. Given the continuing development of the middle class in Russia, there is also demand for less expensive economy-class boats. The market volume for inflatable craft is estimated at around 50,000 craft annually. Most yacht distributors and showrooms are concentrated in Moscow and St. Petersburg. However, expansion of the distribution network into the regions is beginning. For example, sales are increasing in the Volga region and Siberia, as well as in Sochi, a major Black Sea resort area, where the winter 2014 Olympic Games will take place and where luxury yacht clubs will be built. If you have any questions on the opportunities above, contact the UKTI contacts named in this report. Business opportunities aimed specifically at UK companies are added daily to UKTI?s website. These leads are sourced by our staff overseas in British Embassies, High Commissions and Consulates, across all sectors and in over 100 markets. You can be alerted to business opportunities on a regular basis by registering on the UKTI UK Trade & Investment Sector briefing: Marine opportunities in Russia Major events and activities UKTI contacts NEVA Alexander Petrov International Trade Show, St Petersburg Senior Trade & Investment Adviser Contact: UKTI Enquiry Service British Consulate General in St Petersburg Email: Tel: (007 812) 320 3228 Time: 20-23 September 2011 Email: Find full details of all events in this Olga Makarchuk country and sector on the UKTI website. Team Leader, Engineering New export events are added daily to the site British Consulate General in St Petersburg and you can register to be alerted to them on a Tel: (007 812) 320 3223 daily, weekly or monthly basis Email: UKTI?s Tradeshow Access Programme (TAP) provides grant support for eligible Small & Medium Sized Enterprises (SME's) to attend trade shows overseas. Find out more about UKTI support for attendance at overseas events UK Trade & Investment Sector briefing: Marine opportunities in Russia Next steps - How UKTI can help ? Arranging appointments British companies wishing to develop their ? Organising seminars or other events for business in the Russian market are advised to you to meet contacts and promote your undertake as much market research and company in the Russian market planning as possible in the UK. UKTI?s team in Russia, with its wide local knowledge and This work is available via our Overseas Market experience, can provide a range of services to Introduction Service (OMIS) a chargeable British-based companies wishing to grow their service which assists British-based companies business in global markets. wishing to enter or expand their business in overseas markets. This can include: ? Provision of market information To find out more about commissioning this ? Validated lists of agents/distributors work, or accessing other UKTI services and ? Key market players or potential specialist advice, please visit the UKTI website customers in the Russian market to find contact details for your local UKTI ? Establishment of interest of such office. contacts in working with you Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2011 by UK Trade & Investment. Crown Copyright © You may reuse this information (not including logos, images and case studies) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit licence/ or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: This publication is also available from our website at or for more information please telephone +44 (0)20 7215 8000. UK Trade & Investment Sector briefing: Marine opportunities in Russia
Posted: 28 July 2011, last updated 29 July 2011

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