Ethiopian Shipping and Logistics (ESL) officially welcomes its new upgrade and biggest ever vessel on its berth at Ethiopia’s home port, Djibouti port.
MV Abbay II, Ultramax bulk carriers which has close to 64,000 DWT, was commemorated on a ceremony held on Sunday June 25 on its first arrival at Djibouti Doraleh Multipurpose Port, one of ESL’s home ports in Djibouti, with the presence of senior government, port and logistics officials from Djibouti and Ethiopia.
Wondwossen Kassa (Cap), Deputy CEO for Shipping Sector at ESL, expressed that it was not all smooth sailing as multiple ups and downs were weathered for the past year for the realization of this success.
During the welcoming event, he recalled that one of the major milestones in the company’s history was acquisition of 9 Ships in 2012/13 out of which two were product tankers with a carrying capacity of 42,150 DWT each.
“These two product tankers were purchased with the intention to transport import petroleum products for our country. However, these tanker vessels could not be deployed to their intended purposes for various reasons and posed a challenge to the company,” he highlighted on his speech.
As a mitigation measure to avoid financial losses, the company had to look for options to keep them in business. For the past eleven years vessels were engaged mostly on time charter.
“This has somehow assisted in reducing the financial burden but could not alleviate the loss in total,” the Deputy CEO explained.
Studies conducted on various occasions that started five years ago revealed that continual operation of these tankers vessels for the rest of their accounting life to be a loss and suggested for other options. Among the recommended options were to sell the tankers, convert them to bulk or swap them with bulk carrier vessel.
As Wondwossen (Cap) pointed out, “However, implementation of the recommended measures could not be executed due to various reasons.”
At the same time, an additional in house feasibility study was conducted in October 2021 which concluded similar findings. Following this, ESL’s management board after scrutinizing the study and recommended options, gave direction on four alternatives so as to avoid further financial loss to the company.
The recommendation put forth included; swapping tankers with one new Ultramax bulker, swapping tankers with one second hand Ultramax bulker, swapping tankers for one second hand Supramax bulker, which was tabled as a third option while the fourth proposal was swapping tankers for two second hand Supramax bulkers, which had lesser carrying capacity compared with Ultramax type of vessels.
Accordingly, a technical team comprising three company staff was formed in February 2022 and efforts to realize the plan commenced immediately.
“After working tirelessly for almost a year and half, the process has been successfully concluded courtesy of acquiring the biggest ever vessel under the second option that was proposed in the recommendation,” Wondwossen (Cap) told Capital.
MV ABBAY II with DWT capacity of 63,229 and overall length of 200 meter is the first of its kind to ESL’s fleet and was built back in 2016 by Yangzhou Dayang Shipbuilding Co. Ltd., China.
It used was previously registered in Majuro under the flag of Marshal Islands and was operated by Bernhard Schulte Ship management, a vessel management company based in Hamburg, Germany.
“On 25th of April 2023, after finalizing all the preparations and conducting underwater inspection, the delivery procedure was concluded and the document was exchanged. The vessel was then immediately registered under the Ethiopian flag and was given the name ABBAY II. After a long journey of 59 years in the shipping business ESL has now entered in to a new chapter and phase of growth and opportunity,” the Deputy CEO said.
He further underlined that the commemoration of MV Abbay II is a new dawn, chapter and beginning to the company’s history, “It is the first of its kind and much more will follow.”
The Deputy CEO applauded the role of ESL’s former and current CEOs, technical team, board chairman and members, for making all the right decisions and timely support.
He also appreciated MV ABBAY II’s Master, Wubeshet Mekonnen (Cap) and his crew for the smooth taking over of the vessel.
Wondwossen (Cap), told Capital that the new bulk carrier vessel was in high demand in the market and would easily magnetize business for the coming several years at good efficiency.
“These segments of vessels are new generation type of vessels that have less than ten years of history and technically such kind of vessels perform at high fuel efficiency, shallow graft, and carrying capacity and complement the environmental conservation front,” he elaborated.
Wubeshet (Cap), a Master who now leads Abbay II from the former management, told Capital that on its voyage under the Ethiopian flag, the vessel arrived at Pyeongtaek-Dangjin, a port in South Korea, and Dung Quat and Phu My Ports in Vietnam to load steel cargos that will be discharged at Spain ports of Huelva and Bilbao, and Port of Antwerp in Belgium.
Apart from the new coming vessel, ESL currently has nine multipurpose vessels with Handysize segment with a carrying capacity of about 28,000 each.
Abby II is expected to serve the company on its dry bulk shipments front including fertilizer and other cargos that Ethiopia may import besides its activity of cross trade and charter fleets.
Hassan Houmed Ibrahim, Minister of Infrastructure and Equipment of Djibouti, Birhanu Tsegaye, Ethiopian Ambassador to Djibouti, Djama Ibrahim Dara, Managing Director of PDSA/DMP, and other logistics leaders from the two countries attended the event.