New Generation Patrol Craft To Be Launched Next Month

SHAH ALAM: The first of six New Generation Patrol Craft (NGPC) for the Malaysian Maritime Enforcement Agency (APMM) is expected to be launch next month. The keel for the first ship, built by Destini Bhd was laid on Nov. 20, last year at its facility at Port Klang.

Although the launch is on schedule, it must be noted that it will take at least another 12 months before the ship is commissioned into APMM. Perhaps APMM will be luckier in this regard compared to the senior service, RMN.

A model of APMM NGPC at Destini Bhd booth.
A model of the NGPC at Destini Bhd booth at DSA 2016.

Anyhow, as Malaysian Defence had written various posts on the NGPC, please feel free to read them here HERE and Here.

A CGI of the NGPC
A CGI of the NGPC

To recap, the NGPC is a variant of the Fassmer 40M Coastal Patrol Vessel. It is to be armed with a SMASH RWS fitted with a 30mm gun from Aselsan and two 12.7mm machine guns. It will also come equipped with the Fulmar X mini-UAV from Thales for ISR duties. Six of the vessel is being built at the shipyard formerly owned by Destination Marine Services Sdn Bhd. Destination Marine was bought over by Destini in 2015 after it got the contract for the NGPC.

An aft view of the NGPC model at Destini Bhd booth. The upper deck where the two guns are located will also be used to fix the next to recover the Fulmar UAS.
An aft view of the NGPC model at Destini Bhd booth at DSA 2016. The upper deck where the two guns are located will also be used to fix the net to recover the Fulmar X mini UAS.

Destini will also be involved in the construction of the three 80-metre OPV program for APMM. It appears that TH Heavy was cognisant of the claims that it had no prior shipbuilding experience and therefore had entered a JV with Destini – the builder of the NGPC for the OPV program.
Last July when confirming it was in talks with APMM for the OPV program, it stated that the status of talks was in a flux.

SMASH 30mm gun at Aselsan stand. Contracted for the NGPC.
SMASH 30mm gun at Aselsan stand. Contracted for the NGPC.

TH Heavy and Destini signed an agreement for a JV for the OPV project on 27th October, 2016, according to its announcement to Bursa KL on the same date.

The Board of Directors of TH Heavy Engineering Berhad (“THHE” or “the Company”) wishes to announce that the Company has on 27 October 2016 entered into a Joint Venture Agreement (“JVA”) with Destini Berhad (“DESTINI”) to establish an unincorporated joint venture to procure the award of contract in relation to the works related to the supply, delivery, testing and commissioning of three (3) units of approximately 80 metres Offshore Patrol Vessels (“OPV”) complete with fittings and accessories for the Malaysian Maritime Enforcement Agency (“MMEA”) (“Project”), including the performance of an Industrial Collaboration Program (“ICP”) as required by the Government of Malaysia and thereafter to undertake the execution and completion of the works in relation to the Project (“Works”) on a negotiated proposal basis (“Joint Venture”).

The JVA follows a Letter of Intent (“LOI”) dated 27 July 2016, received by THHE, for the supply, delivery, testing and commissioning of the OPV for MMEA.

2. INFORMATION ON DESTINI

Destini is a public company incorporated in Malaysia and listed on Main Market of Bursa Malaysia Securities Berhad. Destini Berhad is an integrated engineering solutions provider with diverse interests in the aviation, marine, land transport as well as oil and gas industries. As at to-date, the authorised share capital of DESTINI is RM 150 million divided into 1,500,000,000 ordinary shares of RM0.10 each while the issued and paid-up capital is RM115,523,029.90 comprising 1,155,230,299 ordinary shares of RM0.10 each.

3. SALIENT TERMS OF THE JVA

Under the Joint Venture Agreement, the Parties agree as follows:

(a) The Parties shall seek written approval of the Ministry of Finance (MOF) and/or any other relevant agencies for the award of the contract in relation to the Project (“Contract”) by MMEA to a consortium, which is to be formed between THHE Fabricators Sdn Bhd (“THF”), a wholly-owned subsidiary company of THHE and Destini Shipbuilding and Engineering Sdn Bhd (“DSBE”), a wholly owned subsidiary company of Destini.

(b) In the event that the Contract is awarded to THF and DSBE, the Parties shall require THF and DSBE to enter into a joint venture agreement. In such event, THF and DSBE shall perform the Works under the Contract.

4. RATIONALE AND PROSPECT FOR THE JOINT VENTURE

The rationale of the joint venture agreement is to capitalise on the complimentary expertise and resources of both parties to execute the Project and bid for similar projects in the future.

With the joint venture agreement, THHE and DESTINI will not only help enhance the nation’s goal for a more secured coastline, but will also diversify and strengthen both THHE’s and DESTINI’s shipbuilding portfolio.

Apart from a stronger shipbuilding portfolio, THHE and DESTINI will be able to potentially recognise stronger earnings to its shipbuilding business in the near term.

It is likely that TH Heavy was issued the LOI for the OPV program under a restricted tender process.

The contract for the OPV program is expected to be awarded to the JV between TH Heavy/Destini soon, industry sources told Malaysian Defence. It is likely that the contract will be awarded next month though the “public” contract signing will be conducted at LIMA 2017.

As this post is about the NGPC, I will write another entry on the OPV soon.

— Malaysian Defence

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