Saudi Aramco Review 2019

Angelo Marcantonio

Angelo Marcantonio

Kanoo Shipping braces for upturn

Kanoo Shipping, the Middle East’s leading offshore agent serving the needs of the offshore industry regionally as well as India and Africa, is bracing for an upturn in the coming year.

“We are positioning ourselves very well in Ras Al Khair port and we’re running the first offshore project in Saudi Arabia’s Western Province. The next year is likely to be very important for the offshore market in Saudi Arabia with five key EPC contractors being awarded the major projects in the kingdom,” says Angelo Marcantonio, Commercial Manager M.E. & Africa, Kanoo Shipping.

During the recent years, all the ship agency houses operating in the Middle East have been suffering because of the geopolitical instability. The first blow was the Saudi-led blockade on Qatar, then the terrorist attacks came and the sanctions on Iran. The blockade caused Kanoo to lose a portion of its bunkering business off Fujairah. It however made up for it by its operations in Singapore through one of its sister company, part of S5 Agency World, explains Marcantonio.

Coming off that, from an offshore stand point, 2019 is certainly a transition to a new round of projects commencing next year, which is allowing Kanoo to review its processes and be prepared to the upcoming volume of business expected in 2020, he says.

Regarding expansions, he says that both the (India and South Africa) geographical expansions that have taken place in late 2017 and 2018 are major milestones for Kanoo Shipping, which has mainly been perceived to be a specialist on the Middle East.

The acquisition of the existing operations and business of Wallem in South Africa as well as the expansion in India will enable Kanoo Shipping to continue its growth and be more effective in expanding the Kanoo leadership into South Africa and India. “This will allow us to migrate our customer portfolio into new geographical areas based on the reputation of Kanoo’s name,” he asserts.

Besides, Kanoo Shipping has recently commenced an operational hub in Bahrain that initially caters to operations in Saudi Arabia and Bahrain ports but will soon be encompassing services to all offices in the Middle East region.

A regional operational hub generating increased efficiency through better planning and communication between customers and local offices, the hub will provide across the Middle East region a much-improved overview to adjust vessel port rotation downtime and optimize the time spent waiting to berth.

Referring to the challenges before the company, he says the challenges are to achieve a consistent standardized operational/financial excellence in all ports Kanoo chooses to serve.

Delivering excellent service under continued price pressure offered significant market challenges. Kanoo Shipping and Saudi Aramco are working together to develop a 5-year IKTVA action plan to improve the company’s IKTVA ratio.

One of the company’s aims is to improve its IKTVA score as a corporate KPI (key performance indicator). “Considering that the IKTVA program has been recently implemented, there are several challenges which we are facing along with Aramco in order to get aligned,” he notes.

On the company’s relationship with Aramco, Marcantonio says Kanoo Shipping acts as an agent for ARO Drilling, which is a 50/50 joint venture between Saudi Aramco and Rowan Offshore Drilling Company to own, operate and manage offshore drilling rigs in Saudi Arabia.

In addition, Kanoo Shipping has been taking part in Saudi Aramco’s projects by rendering specialized services to the major rigs, offshore support vessel (OSV) owners and EPC contractors in Saudi Arabia. “One of the key elements of our business is establishing long-lasting relationships with our clients which vary from EPC companies to oil rig owners as well as OSV owners and operators,” he points out.

EPC contractors take vessels on charter to execute their projects and for this they must appoint an agent. This is where Kanoo Shipping steps in, he explains.

Kanoo Shipping has served its Principals in the Saudi Arabian market since 1957 and its Ship Agency House is today the leading offshore agent in the Middle East, rendering services and covering the needs of the offshore industry regionally as well as in India and Africa. In Saudi Arabia it operates four launches based in Ras Tanura K21, K22, K23 and K30 which the company uses for conducting crew change, customs clearance and delivery of supplies.  

Kanoo Shipping ... next year is likely to be very important

Kanoo Shipping’s services includes the full range of husbandry and operational support to vessels engaged in installation, survey and other offshore work including securing work permits and vessel clearances, arranging crew and spares movement, organizing local supplies and technical support and attending to medical and other emergencies.

Kanoo Shipping handled close to 19,000 port and cargo calls in 2018. Four months into 2020, estimated 12-month forecast reads 20,000 port and cargo calls.

 Meanwhile, there are so many challenges on a daily-basis which may affect the execution of Kanoo’s services and these are related to local rules and regulations, weather conditions while performing the operations offshore as well as third party requirements.

Kanoo Shipping also offers ship agency services to charterers, ship owners and operators and ship managers. Wet cargoes, dry cargoes, offshore and military operations are the company’s high priority. It also renders services for the liner and cruise operators.

To a question on digitalization, he says Kanoo Shipping sees digitalization as an opportunity. “We will take advantage of information technology to increase internal efficiency, to create a differentiating factor towards our competitors, and maintain our position in the forefront of customer system requirements which ultimately will allow us to be more cost efficient.”

The company has launched several new IT applications, web-based customer interface solutions as well as 2 AAP’s serving Android and Apple mobile devices. The recently-introduced Kanoo Port Interface (KPI) is currently being promoted and rolled out to selective customers. It provides a web-based interface between Kanoo’s Clients’ IT system and the company’s VPN/web based “Simply5” platform.

The system enables Kanoo Shipping to manage vessel operations and port call finances through the platform, which is then synchronized with the client interface called “Kanoo Port Interface” (KPI). On January 1, 2018 Kanoo Shipping rolled out an in-house system called Offshore Services Management System (OSMAS) which enhances customers’ satisfaction during service delivery related to the sequence of vessel movements, requirements and invoicing process for the oil and gas/offshore industry.

It adds transparency to Kanoo’s oil and gas/offshore dealings with customers during each step of the operation, as well as enable efficient data management to feed business intelligence tools.

The system has been rolled out in Saudi Arabia and an updated version called OSMAS2 will be implemented by the end of 2019. 

“Real-time expense tracking will help not only our clients but also Kanoo Shipping in managing expenses and funding. The goal is to integrate our system with our clients’ systems to streamline the entire billing process to avoid submission of PO/WO and extra paperwork to clients,” he says.

Kanoo Shipping operates on a 24 x 7 basis, 365 days a year and its operations and management system ensure that customer activities are carried out to the highest safety, quality and environmental standards.

Finally, the company has a “Zero Tolerance” towards bribery and corruption. It follows a strict compliance policy backed up by a practical guide to ensure group governance is applied. Various offices across the network including Saudi Arabia and the UAE are already certificated by Trace and Kanoo Shipping is currently in the process of extending that to other offices in the area that will demonstrate its commitment to transparent business practices by completing “Trace Certified Due Diligence”.




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