The Bahrain Ship Repairing and Engineering Company (Basrec), fighting stiff competition in its core business from regional ship repairing yards, is developing joint ventures in the extended engineering field.

The company, which itself has its floating dock (FD) undergoing a special survey and repairs at Arabian Ship Repairing Yard (Asry), was busy to some extent in mid-2002 as orders had come for work on smaller vessels that could be handled by its two slipways.

The Italian-made FD, which Basrec acquired in 1984, handles vessels up to 6,000dwt and has dimensions of 12m x 18.5m (inside walls) while the two 80-m-long slipways have each a capacity of up to 1,000 tonnes. The two repair quaysides have a minimum water depth of 7m and can accommodate vessels of up to 170m length.

The facility has departments for steelwork, shipwrights, pipework, electrical work and fitting as well as a machine shop and a container repair division. Appointments for specialised services are with reputed companies in the US and Britain.

Created in 1962, Basrec opened for service in the following year and was the first repair shipyard in the Gulf. The company is privately owned with YBA Kanoo holding a majority stake of 51 per cent. In March 1997, the company obtained accreditation to ISO 9002 (1994) for all ship repairing activities and subsidiary container inspection and repairs. The certificate was renewed in March 2000 and currently the company is working to gain the ISO 9000 (2000) certification.

Since Basrec's creation, a number of shipyards have been established in the region and the field is now quite crowded to cause what Basrec general manager Michael Grieve said was a continuous price war. Overcapacity in the yards and falling prices caused net profits to dip to BD541,730 ($1.44 million) in 2001 from BD620,790 a year earlier.

"The first quarter of 2002 was much better than the similar period of 2001," said Grieve. He expected turnover in the second quarter to be reasonably well, but kept his fingers crossed about prospects for the full year. "We can only get profits for what we do. This is a very volatile market. We work in very small forward projections, maybe one month," he said. "It is difficult to predict."

The good news was that the stricken floating dock would be back in service at the yard in August.

"We depend a lot on the FD. Once it's back, we'll have excellent opportunities for a great number of years," Grieve said.

Asry is just across the harbour and too big for Basrec to compete with. The smaller yard has been receiving a fair number of orders from Bahrain-owned vessels. Craft it repairs are usually crew boats, supply boats, barges, tugs and privately owned boats. Basrec has a contract with the Bahrain Defence Force and has three regular customers from Saudi Arabia.

The cost of repairing the FD will go into several million dollars, but also, as Griev puts it, bring Basrec into "a time of consolidation". While Basrec was awaiting the return of the FD, it was fulfilling 10 orders, the largest for work on a 1,500 dwt ship. Four of the ships were foreign ones.

A silver lining for Basrec is the gathering prospects for its other business lines. It has an agency agreement from a company called Philadelphia Resin, which makes a chemical component for propeller engines and generators. The company is also the Bahrain agent for Metalock for repairing steel by stitching. The company sells its services to parties including Asry.

Teams Bahrain, a trading company formed as a 100 per cent subsidiary of Basrec, deals basically in electrical equipment such as switchboards and lighting for the general industry. Teams (Technical Engineering and Marketing Services) is an agent for various products, mainly British, and does not sell directly to the public but makes supplies for projects. It has also agency rights for ABS pumps, used by the Bahraini government.

Teams has still to realise its full po-tential. Competition in the market has been very aggressive, and price-cutting has affected the company's ability to make significant gains, but the company is endeavouring on.

Last June, Basrec figured in a 50-50 joint venture with a UK company. The enterprise, called Marine and Industrial Pump Repair, undertakes a complete range of pump repairs from ships and desalination plants to power stations. The British company in the venture is Leeds-based US Marine and Industrial Pumps Repairs.

Basrec chairman Mubarak Jasim Kano referred in a statement in March to the 50 years' experience of the British partner in the joint venture. "Business has been slow, but with marketing levels high, good results are expected this year," he said.

A year after the joint-venture operations commenced, Grieve says: "We consider it to have great potential." The company has done jobs for high-profile establishments such as Petroleum Development Oman, Kuwait Oil Tanker Company (KOTC), Asry and various government organisations.

"We have repaired pumps for our own FD. Currently we are doing work for PDO, KOTC and ABS Pumps," revealed Grieve in late June.

In an increasingly difficult business environment, it is wise to have different lines going. It could spell survival and prosperity. This is what Basrec has done and it is not resting on its oars. The company is contemplating additional ventures with European companies.