RIL to pump billions into dredging and shipbuilding

The Mukesh Ambani-owned Reliance Group is set to make a foray into shipbuilding and dredging with two separate companies. Sources said the petroleum-to-retail giant is expected to invest around $1 billion each in two companies and has begun talks with international majors for a strategic tie-up for the dredging business. This $2-billion investment is over and above the $1.3-billion investment committed for the Rewas Port, off Navi Mumbai.

The shipyard will be built at Rewas, where Reliance is setting up a mega port and a special economic zone (SEZ). The company is also looking at a ship repair yard at Kakinada for servicing offshore/platform vessels and rigs. This facility is expected to be the hub for all its offshore activities in the KG basin, where Reliance Industries (RIL) has struck oil and gas in abundance.

The group will spend around $1 billion to build dredgers at its own shipyard and other yards. Plans are also afoot to set up a mega dredging company, which will compete with international giants such as Van Oord and Dredging International.

Around 80% of the world???s dredging market is serviced by a handful of European majors, mostly from Holland and Belgium, such as Royal Boskalis, Dredging International, Van Oord and the Jan de Nul Group. Sources said Reliance wanted to start building dredgers at the yard initially, and later expand the capacity to build other ocean-going vessels.

???Talks are currently on, and it is likely to take a final shape in a month or two,?? said a senior RIL official. He said the Kakinada facility will be owned by Reliance Logistics while the shipyard project will be owned by Reliance Logistics Investment and Jai Corp, a company belonging to Anand Jain.

Amma Lines, the initial promoters of Rewas Port, is expected to join hands with the Reliance Group for the two projects. Sources said Amma Lines has already signed an agreement with the Dutch dredging major IHC Holland to bring their ship designs to India.