Oman Shipping Co (OSC) will begin its push to become a major regional box player in September.
Michael Jorgensen, its chief financial officer and acting chief executive, has revealed to TradeWinds that the company has hired what he describes as a “very experienced container person” to turn its ambitious plan into reality.
Jorgensen himself was previously vice president of Maersk Line, so it would not come as a surprise if the new hire has been sourced from the Danish containership giant. For now though, mum’s the word from OSC’s Muscat headquarters.
In January, Jorgensen announced that OSC was prioritising the development of subsidiary Oman Container Line (OCL) into a regional liner player.
The region that Jorgensen is keen to target stretches from East Africa to the Middle East and India.
“Within three to four days' sailing from Oman, you can reach more than two billion consumers,” he said.
OCL currently operates a couple of liner services along the Omani coast and to the United Arab Emirates using chartered tonnage, but it no longer wants to be a small, almost insignificant player.
In September, the company plans to launch its regional services and have three up and running by the end of the year. It will then gradually add more. It hopes to eventually cover 15 to 16 countries, using a hub and spoke system based out of Omani ports.
Regional focus
OCL is positioning itself as a carrier of the cargoes of regional customers and as a feeder operator for mainline carriers.
There is strong growth of container transport taking place in OSL’s defined region but Jorgensen claims that there is one glaring absence.
“At the moment, there is no leading regional player,” he said.
That statement may not be deemed entirely accurate by existing feeder players operating in the region, such as Dubai-based Simatech, Milaha Maritime & Logisitics of Qatar and Singapore-headquartered X-Press Feeders. The companies each have networks focused on the inter-Gulf, subcontinent and Asian liner trades.
Nevertheless, Jorgensen believes OCL will be able to offer both mainline operators and regional cargo customers with local knowhow and flexibility.
OCL also gets to tap Oman’s geographic advantage of being located on the Indian Ocean, right on the main Asia to Europe trade lanes.
He claims that potential customers are already knocking on OCL’s door.
“The big liner companies are busy managing their global services and their big ships," he said. "They don’t have the flexibility to adjust their services. We plan to be very agile, to adjust our services to fit into their schedules.”
OCL also wants to establish network capacity-sharing agreements with the main container lines so that it can offer its regional customers space on trunk services.
Recruitment drive underway
With the unnamed person hired to lead OCL set to begin work in the very near future, the recruitment of more key talent is underway.
“We are hiring people with the required skills sets and know-how," Jorgensen said. "The liner business is all about having the right processes and networks.”
He added that OCL wants to be the first liner company that will be able to provide customers with instant online confirmation of bookings, and, free of any legacy systems and problems, is able to start a new digital platform.
Similarly, OCL will be able to develop its fleet from scratch, which for now Jorgensen indicated will comprise ships taken from the charter market.
He expects the company to require about 15 containerships by the time it is operating five to six routes. These will be vessels of between 1,000 teu and 3,000 teu, standard sizes for the feeder and regional liner trades.
New routes will likely be served by ships taken on short period charters, while established trunk routes will have ships taken on long-term charters.
“We have to remain agile, and short period charters will allow us to test routes and their requirements,” he said.
The company may eventually buy several containerships as a hedge against potential volatility in the charter markets and also “to show our seriousness”.
“It is an attractive market for both buying and chartering containerships,” Jorgensen said.
