DFC Commits $125 Million to Modernize Elefsina Shipyard in Greece

According to recent news from the U.S. Embassy and Consulate in Greece, Scott Nathan, the U.S. International Development Finance Corporation (DFC) Chief Executive Officer (CEO) Scott Nathan signed a financing agreement for a $125 million loan to ONEX Elefsis Shipyards and Industries (ONEX) to rehabilitate and modernize the Elefsina shipyard near Athens, Greece.

DFC financing will help create a strategically critical maritime and energy supply hub for the region by expanding the shipyard’s capacity to service liquified natural gas (LNG) ships, promoting European energy security and diversification, creating new local jobs, and bolstering the U.S.-Greece partnership through a transparent, high-quality investment.

“DFC’s investment in the Elefsina shipyard will develop a maritime and energy supply hub that will create good local jobs here in Greece and help the country and region become less reliant on Russian energy,” said DFC CEO Scott Nathan. “DFC is proud to advance this high-quality infrastructure project that will generate more reliable access to energy and foster greater economic growth and prosperity for our partners across the region.”

CEO Nathan joined Greek Minister of Development and Investment Kostas Skrekas and U.S. Ambassador to Greece George Tsunis at the shipyard for the signing ceremony. With DFC support, ONEX will expand the shipyard’s capacity to repair and upgrade ships, particularly ships that service the nearby Revithoussa LNG terminal. This will promote increased access to reliable, secure energy in the Western Balkans and Eastern Europe by expanding high-quality infrastructure to support diversification of LNG supply for the region – a critical undertaking amid Russia’s attempts to destabilize regional energy access.

The shipyard is strategically located near several key gas trade routes. ONEX will use DFC financing to transform the shipyard into an energy supply hub supporting LNG shipping lanes in the Mediterranean and Aegean seas and supporting Greece’s renewable energy goals.

DFC’s investment is projected to expand the shipyard’s capacity to service up to 200 ships per year. In addition, the new facilities will include a 30MW solar farm to provide energy to the shipyard and to the local grid. The upgrades will include repurposing part of the shipbuilding infrastructure for the fabrication and assembly of wind turbines.

This investment advances President Biden’s and the G7’s commitment to strengthening global infrastructure through values-driven, high-standard, and transparent investments.

It is reported that Elefsis Shipyard was established in 1962 and has been in operation since 1969 as a large shipyard and repair facility for the Greek commercial fleet, having built the largest bulk carriers in Greece. Hit hard by the European shipbuilding crisis, Elefsis, like other Greek shipyards, fell on hard times, and in 1997 was acquired by Neorion, which led to a short-lived improvement in business conditions, but then fell further into debt and disrepair. The shipyard’s debt at the time of its bankruptcy filing was reported to have exceeded US$460 million (RMB 3.35 billion).

In 2019, ONEX completed the acquisition of Elefsis Shipyard and has been attempting to restore the shipyard’s production capacity.ONEX hopes to fully revitalize Elefsis Shipyard to grow to become the largest shipyard in Greece, with a production capacity of up to 200 vessels per year, and will restart construction operations. The shipyard has been providing maintenance services to the Greek Navy for the past few years and has a contract with the Greek Navy for the construction of two vessels.According to the plan, Elefsis Shipyard will become a major supplier to the Greek Navy as well as to the commercial shipping industry.

In November 2022, Elefsis Shipyard took delivery of its first merchant vessel in more than five years.The shipyard will be the first in the Greek Navy’s fleet to receive the first commercial vessel in more than five years. The 56,500 dwt bulk carrier “Star Cleo”, operated by Star Bulk, arrived at the yard for overhaul. The yard also completed the lifting of Dry Dock No. 1 in April this year after several years of inactivity.

In July this year, Elefsis Shipyard completed the remodeling and upgrading of its Panamax Class Dockyard, a key step in the shipyard’s strategic construction capacity upgrade. Following the renovation, the Panamax-class yard is now the most modern in Greece, with an intelligent management system capable of carrying out a range of ship maintenance tasks. It is also one of the largest Panamax dockyards in the eastern Mediterranean and can accommodate Panamax vessels (maximum length up to 294.13 meters, width up to 32.31 meters, draught up to 12.04 meters and average deadweight of 65,000 tons).

In addition, ONEX has entered into a cooperation agreement with Italian shipbuilding group Fincantieri to support the revitalization of the shipyard. The Greek shipyard will become a supplier to Fincantieri and will be supported by the Italian shipbuilding giant in a series of projects, starting with the construction of at least two corvettes for the Hellenic Navy, with an option for a third.Elefsis Shipyard aims at expanding its capacity through new production lines and other facilities to be able to take part in complex frigate projects. Fincantieri will also support the development of maintenance, repair and overhaul capabilities for the Greek Navy and the commercial shipping industry.

It is worth noting that back in 2014, the Greek government said it would welcome Chinese shipyards to invest in Greece in order to address the struggling ship repair industry, for which it had twice attempted to sell the Elefsis shipyard to COSCO Shipping Group. The location is said to be close to the Piraeus Container Terminal, which is operated by COSCO Shipping Group. However, according to Greek media reports, due to the shipyard’s legal disputes and other issues, the Chinese shipbuilder eventually gave up the acquisition.



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