Digital Outcomes: Meratus Saves Millions in Annual Dry-Docking Costs

Over the last year, Indonesian container line Meratus has seen a significant improvement in how they handle dry-docking projects, achieving cost reductions in the millions. This was achieved thanks trough as improved planning processes and more professional management of repair yards, all supported by VesselMan’s cloud-based solution for managing dry-docking and ship repair projects.

Previously, Meratus had faced challenges related to dry-dockings, a scenario all too familiar to those responsible for technical management of vessels, with unpleasant surprises showing up while the vessels are in dock, leading to costly additional jobs and prolonged yard stays.

As is the case in many shipping companies, dry-docking was a technical undertaking, driven by individual superintendents based on their practical experience. There were no standardized tools or processes. Docking projects were simply not fully under control, and delays and cost-overruns were common.

Meratus’ dry-docking director, Øystein Wikeby, set up an ambitious plan to cut average yard stay by 15 days and save the company $2 million in dry-docking related costs. The key to achieving this was the introduction of a standardized project management process, risk management, a strict variation order process and tight cost control, all supported by modern software.

“The most important part of managing dry-dockings,” Wikeby explained, “is having a solid yard specification describing all the repair jobs in detail. And to achieve this, we need to know the condition of the vessel. At Meratus, we now do a full condition assessment of the vessel, including diving inspections, class survey and ultrasonic thickness measurements, all to be completed minimum five months in advance of the docking.”

“Managing the repair yards can be a challenge, but with a solid yard specification in hand, Meratus can get proper quotes on all the repair jobs and put a solid contract in place with the yard.

“A challenge is that the industry standard is to let the yard control the work performed. They will then come with an invoice at the end of the docking project where they have included lots of extra work performed and materials used, and then you just have to try your best to negotiate down the final price. This is not acceptable for Meratus,” he said.

“We make sure that the yards understand that they can only bill us for the agreed work scope,” says Wikeby, and if they want to bill us for work performed beyond what is in our yard specification, they will need a variation order from us. Frankly, it has not been easy to change the mindset of the yards, but we are getting there!

“I am really proud of our team of superintendents and what we have achieved. We docked 18 vessels last year and have achieved a 41 percent reduction in docking time compared to Q1 2018 with a corresponding saving in off-hire costs.

“This outcome also wouldn’t have been possible without the support of VesselMan’s drydocking solution and software.”

VesselMan’s cloud-based solution for dry-docking and ship repair projects offers support for the whole process from planning to writing yard specifications, comparing yard quotations, managing variation orders, and reporting on cost and time progress. Having a cloud-based collaboration platform means that the team of superintendents can easily share best practices and support each other on projects.

“VesselMan gives me, as a manager, full visibility on where we are on planning our different dry-docking projects,” says Wikeby, “and I can step in and offer support if I see that one of my superintendents is falling behind schedule.”

“My vision is to have full and real time cost control of our docking projects,” exclaims Wikeby, and with VesselMan we are getting close!”