New Joint Venture Tanker Company Sets Sail

$430 Million Joint Venture to Eye Gas Ships Next?

Gulf Energy Maritime PJSC, or GEM, is a new $430 million joint venture shipping company, launched last month. Headquartered in Dubai, GEM is owned by Emirates National Oil Company (ENOC) (35%); Abu Dhabi-based International Petroleum Investment Company (IPIC) (30%); Oman Oil Company (30%); and Thales (5%).

The company is intent on capitalizing on the worldwide ban on single hull tankers, and will start with two Double Hull Panamax ships, with four more Panamax newbuilds under construction at Hyundai Heavy Industries for delivery by 2005. Initially, the company will only transport clean petroleum products and easy chemicals, including naphtha, kerosene, MTBE, methanol, jet fuel, MOGAS, and other hydrocarbons. "With the launch of this clean petroleum product tanker company, we are heralding a new era in environmentally friendly, high quality and commercially-driven shipping in the region," said ENOC Group Chief Executive and Board Member Hussain Sultan, and the first chairman of GEM. "This is a great window of opportunity for us to assume a leading role in the global shipping lanes." Its strategy will include the operation of vessels in a portfolio of long, medium term and spot charters. "The GEM investment represents a double first for IPIC, marking IPIC's first participation in the shipping sector, and its first investment in a UAE-based joint venture," said Mohamed N. Al Khaily, Managing Director, IPIC.

GEM will be managed as a stand-alone entity independent of shareholders. "Shareholders however, have access to significant amounts of potential cargoes," said Sultan. "This, coupled with access to competitive finance and the fact that we will be operating from the tax free low cost environment of the UAE, are competitive edges that Gulf Energy Maritime has when benchmarked against other industry players." Xavier Thuriot, Chairman & CEO of Thales International Middle East, said "The participation of Thales in this project is fully in line with our long-term commitment to the UAE. Through the country's offset program, we are proud to contribute to the creation of a UAE company able to provide competitive solutions at international standards."