By Mark Cardwell

Alex Vicefield says he understands why many people are sceptical about the latest rebirth of Davie Canada. But the young British Vice-President of Zafiro Marine, the London/Monaco-based international fleet management company that purchased the troubled shipyard in November, thinks those attitudes will change as new vessels start to be launched from the facility beginning this year. “We’re very aware of what happened here in the past,” Vicefield said in a sit-down interview in the office building at the massive shipyard in Levis, Que. on April 30. “But the big difference between us and some of the previous owners is that we have the resources, the markets and the knowledge to do what we are planning to do.”

According to Vicefield, his company’s long term goal is to promote and position Davie internationally in naval construction, offshore oil and gas exploration and production, and industrial manufacturing. In the short term, it is focussing on completing the three Cecon vessels that have been sitting unfinished for the past several years as a result of the financial capsizing of the yard’s former Norwegian owners. In addition to the Cecon vessels, the new owners also have a contract in hand to build two car and passenger ferries for Société des Traversiers du Québec. That contract was signed in haste two years ago in an effort by the Quebec government to support a bid on the multi-billion-dollar National Shipbuilding Procurement Strategy by the yard’s most recent owner, Ontario’s Upper Lakes Group, and its partners SNC-Lavalin and the South Korean firm Daewoo. When that bid failed, however, and its partners pulled out of the project, Upper Lakes put the yard up for sale.

A group of privately owned companies that specializes in the management of vessel construction, upgrade and conversion projects for offshore oil and gas services market, Zafiro Marine Industries bought the yard in November for an undisclosed sum. The deal was approved by the Quebec government, which was owed $35 million in unsecured credit to Davie. For its part, Cecon, a publicly traded Norwegian company whose assets are essentially limited to its three unfinished ships – and which has seen its market value fall dramatically – struck a deal in December with Export Development Canada, which purchased its debt on the ships to the tune of $230 million. Cecon subsequently secured $280 million in financing from New York-based York Capital Management, which has allowed work to continue on the ships early this year. Vicefield said about 200 unionized Davie workers have been recalled, with another 20-40 more arriving each week. “We hold an induction meeting for new arrivals every Monday morning,” he added. “Health and safety are a high priority for us because we are from the oil and gas sector.”

The goal, he said, is to have 500 workers in the yard by June, and twice that number when work begins on the ferries, which are scheduled for delivery in 2014. Vicefield said the $120-million deal for those two 3,500-tonne vessels was successfully renegotiated with the Quebec government in April – a deal the government had said publicly in March that it would not reopen. “It’s been adjusted slightly to account for inflation,” said Vicefield, who is responsible for commercial and technical operations with Zafiro Marine, which has a fleet of a half a dozen diving, offshore construction and heavy-lift vessels – among them the aptly named Samson, one of the world’s largest DPIII pipelay/heavy lift vessels.

The new Davie also announced the hiring of several senior managers on May 1, including new senior Executive Vice-President Jared Newcombe, who was project manager of Halifax shipyard’s current newbuild contract with the federal government, and ex-Lockheed Martin executive Andrzej Marasinski, who is now Davie’s new Vice-President of federal government projects. “We are very pleased that we have been able to attract such skilled talent at all levels throughout the organization,” said Alan Bowen, Davie’s Chief Executive Officer. “With a blended team from the oil & gas, shipping, defence and other heavy industries we are well placed within our target markets.” The hirings are the latest in a dizzying number of developments that began a year ago, when Vicefield first visited the Davie yard a year ago on behalf of Cecon’s Board, of which he was until recently a non-voting member.

A specialist in fleet investment strategy, marine asset management and commercial contracting and a former commercial Director of two divisions of V.Ships (offshore oil and gas renewable and commercial management), he said Zafiro Marine was then actively shopping for a shipyard. “We wanted to have a yard of our own,” he said. “If you go to a third party, you’re not in control. You have more stability if you have own facility.” He said they had looked closely at two shuttered yards in Spain and another in Britain. However, they decided that a lack of both maintenance and a skilled workforce made successful restarts improbable. That all changed, however, when Vicefield visited Davie.

“There were so many captive opportunities,” he told Canadian Sailings. In addition to the yard’s geographical position on one of the world’s busiest shipping lanes, Vicefield said the unfinished Cecon ships, the burdgeoning global cabotage market and the possibility of industrial fabrication contracts for any number of international or Canadian development projects, including Quebec’s Plan nord, made the yard look like a dream come true. Another big advantage, he added, was the presence of a large skilled, unionized workforce that earned far less than their counterparts in yards in Europe – notably in Spain, Germany and Norway – where Zafiro Marine was getting specialized conversion work done on vessels for the offshore oil and gas industry. “The wages here are rational and reasonable,” said Vicefield. “And the quality of the work is absolutely first rate.”

Bowen, too, was impressed with what he found when he showed up to head a 10-man team of marine engineers and other experts to conduct a detailed forensic analysis of the financial, technical and commercial aspects of Davie Canada. “We basically wanted to see if the assets had been stripped away (and) to make sure we weren’t buying an empty hole,” he said.

In addition to two large and well serviced drydocks, Bowen said he was both amazed and impressed by the quality of the facilities and equipment, which notably featured a steel cutting capacity of 300 tonnes a week – nearly four times the current capacity of the big Irving yard in Halifax. “Everything had been extremely well maintained,” he said. “That made our jobs much easier.” If that wasn’t enough, the former Norwegian owners had imported almost all of the equipment for the Cecon vessels – from doors and beds to the galley extractors. “Almost everything we need to finish them is here,” said Vicefield. “No major procurements have been required.” He added, however, that the new owners have made some changes that will improve operations. One is the updating of management software, such as electronic employee access in and around the yard. Another is a plan to move the Cecon ships out of the drydocks and onto the yard’s four slips. “It’s a mistake to build a ship in a drydock,” he said. “You want to keep them open and available to do ship repairs, which is what we intend to do.”

For observers and stakeholders in Canada’s shipbuilding industry, the new owners of Davie are as credible as they are welcome. “They’re very entrepreneurial (and) seem very well established in their market,” said Peter Cairns, President of the Shipbuilding Association of Canada. Though the revitalized yard will result in more competition in the repair business, Cairns thinks their activities will add a dynamic new element to Canada’s shipbuilding assets and offerings. “I think it’s very exciting because there are many opportunities for newbuilds on the horizon, notably with the Canadian Coast Guard,” said the former admiral. “The long and the short of it is that, with two of the country’s biggest yards filled with NSPS orders, it’s terrific to have another one that can compete for all the potential work here that would otherwise go overseas.”