Shipbuilding co to expand Jervoise Bay operations

June 26, 1997

One of Western Australia's world-class shipbuilding companies is to expand its Jervoise Bay operations and develop its capacity to build large high-speed ferries.

The company, Oceanfast Ltd, a new company formed following the purchase of the shipbuilding assets of Oceanfast Marine Group, will spend $12.5 million on the project. A further 133 jobs will be created, as well as spin-off jobs to suppliers.

Commerce and Trade Minister Hendy Cowan announced today that the Government had approved a $1.25m loan to Oceanfast Ltd to help it buy and develop two shorefront lots at Jervoise Bay from LandCorp.

"This development will strengthen the Western Australian shipbuilding industry's grip on the expanding export market," Mr Cowan said.

"It will consolidate the State's position as a world leader in this market.

"The new facilities to be built on the sites will enable Oceanfast Ltd to expand its output in the lightweight high-speed mega ferry sector."

WA's lightweight shipbuilding industry produced two-thirds of Australia's commercial shipbuilding output.

In 1995-96 the State exported vessels worth $180 million - some 18 per cent of the world's high-speed lightweight ferry production.

The market for these vessels was expanding rapidly in the Mediterranean and in Asia.

It was estimated that about 1,000 vessels would be required in the next 10 years to meet demand for mass travel over extended sea routes and to replace ageing vessels. Western Australian shipbuilders were expected to produce $390 million in shipping this financial year, based on current orders. About 85 per cent of these new vessels would be exported lightweight ferries.

"The Government is encouraging the local industry to take advantage of the growing international market by increasing its large vessel capability and production capacity," Mr Cowan said.

"We are doing this in a number of ways. Through direct Government funding the harbour at Jervoise Bay will be completed by the construction of a 700m breakwater to provide full protection for WA shipbuilders. This proposal is subject to EPA approval.

"As well as making freehold land available, we are supporting a Marine Fabrication Training Centre and considering a proposal for a Marine Industry Technology Park at Henderson."

Mr Cowan said that in 1994 the Government had approved an interest-free loan of $1.21 million to Austal Ships to help it buy shorefront land to expand its production in a similar way.

"At the time, other shipbuilders were told that the Government would consider proposals for similar assistance from other companies engaged in similar work. This incentive is in accordance with that principle," he said.

Until recently, Oceanfast had worked mainly in the area of design and construction of luxury motor yachts and small ferries.

The total cost of the land being bought was $1.82 million and Oceanfast Ltd proposed to widen and extend existing slipways and build new construction bays. The company would spend a total of $12.5 million.

The Government's loan would progressively convert to a grant over five years, if the company met investment and performance milestones.

Government incentives had resulted in substantial investment in facilities at Jervoise Bay and more investment was in the pipeline. As a result, the WA Government recently announced an end date of September 30, 1997 for consideration of further applications for incentives from this market sector.

Media contact: Peter Jackson (08) 9222 9595