11 October 2016
International law firm Watson Farley & Williams LLP (“WFW”) has advised Russia’s largest shipping company, Sovcomflot (“SCF Group”), on its joint venture with SPO (“JV”) and the purchase of SPO’s two multi-purpose icebreaking platform supply vessels “Pacific Endeavour” and “Pacific Enterprise”. These two vessels represented SPO’s contribution to the JV’s fleet of three vessels, all of which were previously under the management and operations of the JV since 2006. The third vessel managed by the JV, “Pacific Endurance”, was already fully owned by the SCF Group. Starting from 11 October 2016, SCF Group will solely own, operate and manage the above 3 vessels.
WFW also advised the SCF Group on the restructuring of the JV’s charter and management arrangements, as well as the implementation of the new management and charter structures for the three vessels outside the JV.
All the three platform supply vessels will now be operated by the SCF Group under long-term time charter contracts with Sakhalin Energy in relation to its Sakhalin-2 project, one of the largest oil and gas projects worldwide. Under the signed agreements, the vessels will continue to be used for year-round delivery of supplies and consumables to three production platforms in the Sea of Okhotsk.
As part of Sakhalin-2, the SCF Group also operates three Aframax shuttle tankers (“Zaliv Aniva”, “Sakhalin Island” and “Governor Farkhutdinov”) and, in partnership with the Japanese NYK Line, two LNG tankers, each with a capacity of 145,000 cubic metres (“Grand Aniva” and “Grand Elena”). All these vessels are on long-term time charter contracts with Sakhalin Energy and are used to transport hydrocarbons from the port of Prigorodnoye to Asia-Pacific countries.
Sovcomflot specialises in the transportation of crude oil, petroleum products, and liquefied gas, as well as servicing offshore upstream oil and gas installations and equipment. Registered in St. Petersburg and with offices across Russia as well as in London, Limassol and Dubai, its fleet comprises 153 vessels with a total deadweight of over 13 million tonnes.
The WFW team that advised Sovcomflot was led by maritime partner Toby Royal, assisted by senior associate Sandy Apostolatou. Partner Christina Howard advised on the corporate aspects of the deal, assisted by senior associate Rhiannon McArdle.
Toby commented: “I’m delighted to have advised such a longstanding, valued and important client of WFW as Sovcomflot on a complex and multi-faceted matter that will enable them to maximise their cooperation with Sakhalin Energy and increase their participation in the Sakhalin-2 project”.