Growth in Latin American terminals and trade will generate newbuilding tug orders for shipyards worldwide, says SAAM Towage chief executive
Sociedad Matriz (SAAM) subsidiary SAAM Towage has built up a formidable position in the South American towage sector to dominate tug operations in major markets. It operates in nine countries with a fleet of more than 150 tugs providing harbour and terminal operations, coastal towage and salvage response.
SAAM Towage chief executive Felipe Rioja thinks future growth in its fleet and operations will not only come from South American markets, but also the Caribbean and Canada.
SAAM Towage has targeted growth through fleet expansion and renewal following its acquisition of Boskalis’ share of the joint venture SAAM Smit Towage in Q4 2019. This US$194M purchase enables SAAM Towage to concentrate on increasing its market share in South American and Caribbean markets in the next decade.
“After full consolidation of SAAM Towage in Brazil, Mexico, Panama and Canada,” Mr Rioja explains to Tug Technology & Business, “we are on our path to consolidate our company leadership in the region under a common model, which means a better service for our clients.”
SAAM Towage completed the purchase from Boskalis on 30 October 2019, consolidating its tug services and fleet under one brand and plans further expansion.
This is expected to include newbuilding orders from shipyards in the region and in Europe and Asia from 2020 onwards to cater for growth in South American towage services and other areas of SAAM Towage’s operations.
“The Caribbean area is a potential growth opportunity for us,” says Mr Rioja. “We are actively mapping the market for the right opportunity to expand.”
The Caribbean region is becoming a new destination for container ships, tankers and gas carriers.
“We have a special eye for terminal towage in this region as it demands renewal to its current available fleet,” said Mr Rioja. This is in response to larger container ships calling at these terminals.
SAAM Towage will compete with other tug owners for towage and terminal support projects in the region including Iskes Towage, Enapor, Ocean, Seabulk Towing, Svitzer and Kotug International.
In South America, SAAM Towage competes with tug owners including Boluda, Coltug, Coremar and Ultratug, and local operators such as Aliança Navegação, DLEN, Navegacion del Sur and Wilson Sons Rebocadores,
But Mr Rioja is not daunted by this competition. Rather he sees these as potential opportunities for future growth through corporate investment.
“Mergers and acquisitions have been an important element for our regional consolidation,” he says. “Thus, upon finding the right opportunity, we are open to evaluating additional inorganic growth opportunities.”
New fleet additions
SAAM Towage’s growth in the Americas has involved investing in new tugs for harbour and terminal operations which has expanded its fleet to 153 vessels operating in more than 60 ports.
“Over the last five years, we have incorporated over 25 tugboats to our fleet as a continuous commitment to meet our clients’ demands and to provide the marine industry with reliable and efficient tugs,” says Mr Rioja.
“We are scheduled to receive a new tug for our operations in Mexico and another for Guatemala.”
In September 2019, SAAM purchased an azimuth stern drive (ASD) tug newbuilding from Damen Shipyards for ship handling operations in the port of Veracruz. Damen will supply an ASD 2813 design tug with an overall length of 28 m. SAAM Huasteca will have a bollard pull of 85 tonnes and a top speed of 13 knots when delivered in February 2020.
SAAM Towage needed a new tug for its Mexico operations as larger container ships are docking at the port of Veracruz, says SAAM Towage technical manager Pablo Cáceres.
“After new terminal entry criteria was established for merchant ships, studies were carried out that specified the need for more powerful tugs with specific manoeuvrability characteristics,” says Mr Cáceres.
“In a few months, we will be able to satisfy this requirement with SAAM Huasteca, which has a tremendous fixed-point pulling capacity and the qualities the escort class notation provides by design.”
This tug will have two 2,525 kW Caterpillar engines, Kongsberg azimuthal thrusters, and fire-fighting capability recognised under FiFi1 class notation.
In June 2019, SAAM Towage purchased a 23-m tug from Turkish shipbuilder and tug owner Med Marine to boost its operations in Puerto Quetzal, Guatemala. This tugboat was built to a Robert Allan RAmparts 2300-MM design as part of a family of six vessels.
SAAM Itza has ASD propulsion configuration for harbour and terminal operations and coastal towing. It has a beam of 10.9 m and depth of 4.4 m.
SAAM Towage acquired this tug to meet requirements set by Empresa Portuaria Quetzal, the port authorities, in its contract for berthing services.
“The equipment, technology and dimensions of SAAM Itza make it especially suitable for operating in a port with restricted space, such as Quetzal,” says Mr Cáceres.
Future tug orders will be ASD tugs with bollard pull of up to 85 tonnes. “For Central America we will construct three new tugs with state-of-the-art technology, which will be designed for LNG terminal services,” says Mr Rioja.
For terminal services and supporting offshore operations, SAAM Towage requires tugs with escort notations from leading classification societies, powerful bollard pull and specialised deck machinery.
“For our offshore and terminal operations, we use large escort-notation tugs, with more than 28 m overall length equipped with render recovery winches,” says Mr Rioja. “Our fleet is quite versatile, built for specific purposes and fulfilling our clients’ requirements.”
SAAM Towage’s harbour towage tugs have a different design to those operating in terminals. “These types of tug are usually aligned with the type of operation we are tasked to deliver,” Mr Rioja explains.
“For our harbour towage operations, we use effectively sized, but powerful ASD tugs that are fit for inner harbour operations.”
SAAM Towage’s future newbuildings could use hybrid propulsion and energy storage technology due to growing pressures on tug owners to reduce their environmental footprint.
“We are constantly evaluating the alternative fuels offered in the market, such as battery-fuelled tugs,” says Mr Rioja.
But in the short term, he expects tug operators will feel the effects of IMO’s 2020 sulphur cap legislation if this drives fuel prices higher.
“IMO 2020 does not directly affect our sector, providing our tugs utilise low-emissions marine oil,” he says. “However, we do expect a considerable shift in demand for low-emissions fuel, which can cascade effects on the price of fuel.”
SAAM Towage has taken delivery of tug newbuildings in the last three years from Cheoy Lee Shipyards, Damen Shipyards, Med Marine and Uzmar. It works with naval architects such as Damen and Robert Allan, and classification societies Lloyd’s Register and Bureau Veritas.
SAAM group has seen growth in ports, towage and logistics revenues and income. For the period of January to September 2019, SAAM reported net income of US$44M, up 26% from the same period last year.
SAAM Towage invests in state-of the art simulators
SAAM Towage offers simulator training to its seafarers to ensure crew competence. SAAM Towage chief executive Felipe Rioja says the company has a considerable training programme incorporating simulators and mentoring.
“Crew training is a vital part of our business,” he says.
“Through a well-developed system, we train our crew regularly to not only fulfil the maritime industry standards and requirements, but also to provide the industry with safety and an environmentally conscious crew.”
Its training encompasses SAAM Towage’s operations in nine countries throughout the Americas and involves seafarers testing their competence, experience and skills on specialised tug simulators.
“With this objective, we invest in state-of the art simulators, in alliance with universities, which allows us to maintain a high-performance level on our team.”
SAAM group’s values are honesty, respect, responsibility, safety and service. It incorporates sustainability throughout its processes and decision-making. “These principles allow us to approach the management of our businesses in an integral way, considering economic, social and environmental aspects,” says Mr Rioja.
“We seek to create shared value in a harmonious way with our communities, collaborators, clients, investors, contractors and suppliers contributing to increasing the well-being progress of present and future generations.”
SAAM group has been on the Dow Jones Sustainability Chile Index for four years.
SAAM Towage operations:
SAAM Towage has operations in nine countries in North, Central and South America. Around 75% of its fleet of 152 vessels are azimuth stern drive tugs.
Brazil – 13 ports, 48 tugs
Canada – 7 ports, 23 tugs
Costa Rica – 3 ports, 3 tugs
Chile – 18 ports, 21 tugs
Ecuador – 5 ports, 9 tugs
Guatemala – 1 port, 2 tugs
Mexico – 6 ports, 18 tugs
Panama – 9 ports, 15 tugs
Uruguay – 5 ports, 10 tugs
SAAM terminals operations
SAAM group operates a network of 10 terminals in five countries, making it the fourth-largest port operator in South America. It also describes itself as a privileged partner of the world’s leading shipping companies.
SAAM group is the market leader in its home country of Chile, with six ports including the San Antonio Terminal Internacional, the country’s main port and what SAAM claims is one of the most important ports in South America.
As part of the western hemisphere network, SAAM operates terminals in Mexico, the US, Colombia, Ecuador and Costa Rica.
Chile terminals include:
International terminals are:
SAAM group also provides integral logistics services to importers and exporters, airlines and shipping companies. It uses its experience and knowledge to provide solutions for its customers throughout the entire supply chain.
SAAM invests in these terminals in accordance with the concessions and licences. For example, in October 2019, Sociedad Portuaria Caldera’s management announced it would bring forward dredging of the terminal using a Van Oord trailing suction hopper dredger in 2021. This should reduce waiting times and is part of a US$150M investment campaign in the port.
SAAM has also spent US$100M on Terminal Portuario Guayaquil, including dredging to increase draught to 13 m and container ship size to 15,000 TEU at the terminal. This port moves 85% of Ecuador’s non-oil goods.