France-based shipowners Louis Dreyfus Armateurs recently signed a contract marking their début as suppliers of hybrid service vessels for offshore wind farm operations, thanks to a partnership with Danish marine renewable energy conglomerate Dong Energy. LDA president Edouard Louis-Dreyfus discusses the group’s recent diversification and its new approach to managing contracts of this nature.
Mer et Marine: You recently signed a partnership agreement with Dong Energy to fit out a service vessel for its offshore wind farms. How did you get into this market, given that no other French vessel has entered these waters to date?
Édouard Louis-Dreyfus: We’ve had our eye on the offshore wind farm market for several years. We put in a bid a couple of years ago, but were unsuccessful, perhaps partly because the timing wasn’t right. It’s not that we lacked the skills; more that the way we presented them failed to impress.
We learned our lessons and rethought our approach. Now, for each project, we assemble teams with skills tailored to the task. We identify people working with our new construction division, fleet management specialists, legal experts, and so on. These project teams pool their strengths and know-how to present proposals matching the client’s requirements.
This is what we did with Dong. We adopted a low-key approach, paid careful attention to what they wanted, and worked in a completely transparent way. I think we owe our success to the fact that we considered them more as partners than clients. We were the only non-specialists out of the 17 bidding. And yet we were awarded the contract, probably thanks largely to our approach.
Do you think the Dong contract will lead to more work in the marine energy sector?
We’re proud to be flying the French flag and happy for our crews too. Obviously, this contract opens up new prospects. We don’t plan on stopping here, and certainly hope to make it a key market for our group.
Our Louis Dreyfus Travocéan subsidiary is in the running for — and keen to win — the turbine-to-turbine cable laying contracts for two wind farms planned by French renewable energy group EDF Énergies Nouvelles. Building the ship for Dong will give us solid reasons to increase our presence in this sector.
Are you planning to diversify into other sectors?
We certainly are, and we recently set up a Marine Industrial division. For over 20 years now we’ve specialised in high added-value fleet operations and highly trained French crews. In submarine cable laying, transport services for Airbus, and, in the past, offshore seismic research, French know-how has proven cost effective.
So yes, our Marine Industrial division combined with our new approach to tendering will ensure that we maintain a strong presence in markets requiring specialist skills.
Historically, your core business has been bulk freight — a complex market these days. What’s the state of the fleet today?
It has always been difficult for all sea freight companies, especially in the capesize market. We’re hanging on while at the same time reducing our exposure. We’re also on the lookout for the least opportunity. The market fundamentals are, however, looking a little better as, each time demand has dipped, it hasn’t dropped as much as before. Nevertheless, there’s little prospect of any significant improvement before the end of 2017.
These fluctuations are one more reason that we’re working hard to de-risk our business by continuing to diversify. Our other activities give the group stability. Transport services for Airbus are steady; we had a busy 2016 laying submarine cables for Alcatel and our Port & Logistics subsidiary made good progress in Indonesia and elsewhere.
Interview by Caroline Britz, translated and adapted by Allison Wright and Steve Dyson © Mer et Marine, February 2017
See also our article on LDA’s partnership with Danish marine renewable energy conglomerate Dong Energy.