Marcel Roelofs – CEO, Chevalier Floatels – Netherlands
Marcel Roelofs describes this young and dynamic and innovative company in the offshore accommodation market and its introduction of the world’s first state-of-the-art onsite accommodation and walk-to-work vessels.
Please give an overview of where Chevalier Floatels stands today and what the focus of your strategic priorities has been.
At Chevalier Floatels, we focus primarily on two sectors: hotel barges and offshore accommodation with walk to work vessels (W2W). Our hotel barges are mostly located inshore in ports, generally in areas with large constructions sites that lack local housing options. Growth in the sector is strong with relatively high demand, meaning we have grown from one vessel four years ago to four today. In terms of DP2 W2W vessels, we were very innovative in this sphere being the first to own a dedicated DP2 W2W accommodation vessel with an Amplemann system, whereas most other market participants only use an Ampelmann system for certain jobs. Chevalier Floatels want to expand in this segment and is looking into bigger bed capacity for larger projects.
A relatively young and dynamic company, Chevalier Floatels now owns and operates two DP2 accommodation W2W vessels and four accommodation barges. From a resources and capabilities perspective, how much of a role has the Netherlands played in the company’s development?
Our resources come very much from the Netherlands – for example the Ampelmann system is a pure Dutch innovation, while we undertake refurbishment and upgrades in Dutch yards. Market wise, though, the Netherlands has created limited impact on our growth. Nonetheless, we have recently completed several projects locally in the oil and gas sector with our W2W vessels.
Given that the company is mainly active outside the Netherlands, what regions are you focusing on for continued growth?
Our focus thus far has been on advanced markets like the Mediterranean and the North Sea where companies are interested in our high-end units featuring one or two beds per room. Australia, the Gulf of Mexico, and Brazil are also promising markets for future growth. In regions like Asia or Africa, though, the demand for high quality accommodation is not yet strong enough to merit our market entry locally. However, there will be an increase in standards in the coming years worldwide. Even when we started in the Netherlands in the past decade, some companies were skeptical about high end accommodation and have since changed their tune. Workers will simply have higher demands and no longer accept six or four room units. At the moment, we only have two DP2 W2W vessels, so we will also need to grow the fleet before we can expand much more internationally.
From your perspective, what are the most pervasive operating challenges facing the offshore accommodation industry currently?
Cost reductions represent the clearest operating challenging for the industry as a whole. Even before the oil price decreased, there was a strong tendency in the North Sea to reduce costs. This challenge is good for Chevalier Floatels as oil and gas companies are now more open new solutions. Previously, these companies would simply fly in staff via helicopter or use an accommodation jack-up. Now they look are targeting lowering costs via financially more sensible alternatives. The fact that W2W is much more efficient cost wise is one reason for our high number of oil and gas projects in the Netherlands recently. There also exists a tendency to make oil platforms as small as possible to lower costs – meaning no more helidecks and no more accommodation on board. In this scenario, W2W accommodation vessels are ideally suited to service these smaller units. Overall, we thus see strong upward demand in the oil and gas industry for our advanced accommodation vessels with the increased focus on cost savings in the industry. Chevalier Floatels boasts a strong track record from both offshore wind and oil and gas projects. Since oil and gas always want a first mover before trying a new technology, this track record has fostered more rapid acceptance of our technologies.
Nonetheless, the ever-present challenge for the offshore accommodation market is linked to seasonality. It is relatively easy to find work during the high season but much more difficult during the winter months. Even in good years, finding work in the winter is difficult as projects are either stopped or slowed down. Other parts of the world do not have the same high accommodation standards as European markets, so deploying the vessel somewhere else in the globe over the winter months would mean accepting a lower rates.
Speaking more about the novelty of the DP Gezina and DP Galyna, some have stated that these two vessels have set a new standard for the offshore industry in terms of reliability, efficiency, and comfort. What were your initial aspirations in creating these vessels?
Since we had sold our fleet in the Caspian, we wanted to find a new niche market within the accommodation sector where we could add value. After market research, we determined that there would be great future demand for W2W accommodation vessels and thus decided to undertake the conversion of both the DP Gezina and DP Galyna to enter this niche market. We chose a conversion as we had identified the need for such vessels but also recognized that a new build would not meet budgets in the market.
Why was Ampelmann chosen as your partner of choice when converting the DP Gezina and DP Galyna?
At the moment, Ampelmann was the only company with a large track-record in terms of W2W, and we still believe that Amplemann is the best provider of W2W. Furthermore, Ampelmann has a true focus on improving their product. In our regular communications with Ampelmann, we relay our ideas on what should change or be improved with their system, and Ampelmann responds with new ideas and software upgrades to improve their system’s performance. Ampelmann thus acts as more than a product seller and rather as a product developer. Of course, this high quality comes with a price, but Chevalier Floatels also wants to offer the best of what is achievable to our clients.
Given the growing interest in the versatile and lean nature of DP2 offshore support vessels, how do you plan on prioritizing the company’s product portfolio? Will we see such a greater push for vessels such as the DP Gezina and DP Galyna or a more continued stream of shallow water accommodation barges?
We are currently looking into putting a high-scale offshore barge on the market but have not made a final decision, as we face the same challenge of how to deploy such a vessel during the winter months. In the W2W sector, we see demand growing, but it would be a struggle to make the numbers match in ordering a dedicated new build. At the moment, we are thus looking for conversion candidates for W2W vessels.
Since its conception, we’ve also seen a rise in the number of W2W vessels introduced to the global landscape, including Wagenborg’s Kroonborg. What sets Chevalier Floatels’s vessels apart from some of your peers’s?
Our vessels are not specialized vessels, whereas the the Wagenborg vessel is tuned to a specific job for Shell. It thus includes much specific material onboard suitable to this specific project, while it would be too costly for Chevalier Floatels to produce a vessel suited to only one project. We believe the W2W market is still thin, so investing in a broadly usable vessel is more suitable for our company.
How would you characterize your offering in the hotel barges sector?
The hotel barge market includes both low standard and high standard accommodation, and most of our barges fall in the medium segment, comparable to a two three star hotel. We have one barge in the market at a four star hotel standard, a market that we were the first to target. It was a gamble to construct this unit, but it has really paid off with high client satisfaction. I believe the lower end of the barge segment will also disappear, just as it will in overall offshore accommodation, with time given increased demand from workers. Hotel barges are also interesting as you can relatively easily change them to meet market demands. For example, we not only use our vessels as floating hotels but also as floating refugee barges and even prison barges.
What are your personal philosophies on chartering success for a company like Chevalier Floatels?
Most importantly, you have to take a risk and do something the crowd is not doing well. There are always market needs that are not being catered to, and companies that can identify and respond to these needs will be successful. Most companies want to go the safe route, while Chevalier Floatels specifically goes for doing things differently. Taking smart gambles helps set our company apart. I have always looked at how market is developing to grow our company and ensure that the innovation we offer suits market demand.
Out of all your personal and professional experiences, what gave you the courage to ultimately become an entrepreneur and start your own company?
It has always been an ambition to start my own business. Once I was able to identify niche market not yet being served – the accommodation vessel market – I decided to launch Chevalier Floatels. Coming from a hotel background, there was a natural affinity for this sector.
Where would you like to take the company in the next five years?
We are very ambitious and would like to grow every year with one or two vessels or barges. Both the W2W vessel and the accommodation barge segments will grow. In the offshore barge market, we are currently one of the top three players, while we are targeting market leadership in the W2W accommodation sector. We occupy this position now, but we need to expand this business to stay ahead of the competition. Overall, we want to stand out from the crowd and put our own mark on the market.