Tradewinds – Could the Arabian Gulf be the next big recycling hub?

(Written by Jonathan Boonzaier)

8 March 2013 – Bob Hawke of Abu Dhabi-based KARE thinks so and has so far scouted out two possible locations, one in neighbouring Dubai, the other in Bahrain

Can the Arabian Gulf become a new ship-recycling centre?

It can if local governments lend their support to the idea, says Bob Hawke, managing director of Abu Dhabi-based marine-contracting company Khamis Al Rumaithy Est (KARE).

Hawke tells Tradewinds that his company has been involved, albeit on a very small scale, in ship recycling for several years. “We’ve been scrapping barges, but I think it is time we upped our game to larger ships,” he said.

Fuelling Hawke’s belief that scrapping would be a viable industry in the region is the growing number of steel smelters being established in places such as Oman, the United Arab Emirates (UAE) and Saudi Arabia.

KARE has scouted out two possible shipbreaking locations in the Gulf. One possibility is in the emirate of Dubai and another is in Bahrain.

“Dubai would be a good spot for the larger ships because the waters are deeper than in Bahrain. The steel recovered here could be sold to smelters in Oman and the UAE. Smaller ships could go to Bahrain, and then be fed into smelters in Saudi Arabia,” Hawke explained.

Hawke makes it very clear that KARE would be interested only in setting up green-recycling facilities where ships would be broken on dry land.

“We are not interested in beaching. Any time you breach a hull in a tidal zone, whatever toxins are on the ship will be washed out. This is something the authorities here would not allow,” Hawke explained.

Scrapping expert attending the Tradewinds Ship Recycling Conference in Dubai this week believe that KARE may be on to a good idea. They say labour costs in the Gulf are not much higher than in India or Bangladesh and there is a ready market for the steel. They also point out that the Indian subcontinent, the main market for recycled steel, is very close at hand and, therefore, would be a viable destination for steel retrieved from ships scrapped in the Gulf.

Hawke is engaged in preliminary discussions with authorities in the region. “They have expressed an interest in the project,” he said, although he cautions that it may be a while before that interest translates into concrete action.