Azerbaijan’s shipbuilding industry accelerates growth Setting sail toward a new maritime era

The observed drift of cargo carriers towards alternative transportation routes of the Middle Corridor over the past three years is encouraging countries in the Caspian region to increase their tanker, ferry, and bulk carrier fleets, including through the construction of new ships at local shipyards.

Azerbaijan has long been recognized as a key transport hub in the region, with the fleet of Azerbaijan Caspian Shipping Company (ASCO) being the largest and most powerful in the Caspian. To meet the growing demand for vessels, ASCO has been placing orders for new ships at the Baku Shipyard for several years. Additionally, ASCO’s Zikh Ship Repair and Construction Yard has started producing auxiliary vessels. Recently, the "Azikh" tugboat was transferred to the Caspian Sea Oil Fleet, becoming the fifth in its series.

Spanning 620,000 square meters and equipped with state-of-the-art technology from leading European manufacturers, as well as South Korea and Singapore, the Baku Shipyard is rightly recognized as the largest shipbuilding facility in the Caspian region. Today, the specialists at Baku Shipyard (which employs 722 people) are working to transform the facility into a full-fledged centre for innovative engineering. The shipyard is implementing green energy solutions, and conducting research in human-ship interfaces and smart sensor technologies. 

Notably, the shipyard’s capacity allows it to process up to 25,000 tons of metal simultaneously, making it possible to construct four tankers within a year. Additionally, by the beginning of last year, the shipyard had completed major repairs on over 170 vessels and performed routine maintenance on more than 30. Among its notable projects, the shipyard has undertaken several regional ship repair projects for vessels from Kazakhstan and Turkmenistan. Looking ahead, Azerbaijan can expect new shipbuilding orders from countries in Central Asia, Iran, and Russia.

In recent years, the Baku Shipyard has not faced any shortage of orders for new tankers, ferries, and other vessels for domestic needs. The driving force behind this demand is the Strategic Plan for the Development of Shipping from 2022 to 2030, under which ASCO plans to procure approximately fifty vessels, including both cargo and passenger ships. 

Notably, the majority of the cargo ships will be built directly in Azerbaijan: ASCO is placing orders step-by-step at the Baku Shipyard, and having a domestic shipyard (which began operations in September 2013) has enabled the country to achieve import substitution and significantly reduce production costs. Over the past eleven years, Baku Shipyard has built 11 vessels of various types, including one transport vessel (SOCAR-1), three supply-passenger vessels ("Ufug," "Zafar," and "Turan"), four tankers, two Ro-Pax type ferries ("Azerbaijan" and "Zarifa Aliyeva"), and a special vessel "Khankendi." 

Furthermore, work on building versatile Ro-Pax ferries is progressing successfully: by the end of December last year, the main engines had been installed on the third ferry in the series, 80% of the hull work was completed, and the installation of pipes, electrical systems, ventilation, and other components continued as per the project plan.

Overall, the shipyard's order portfolio, projected until 2028, includes 13 new orders, mostly from ASCO, for vessels of various types. Plans include the construction of tugboats, crane vessels with varying load capacities, a CSD 650 dredger, and various auxiliary vessels. Additionally, Baku Shipyard plans to collaborate with the United Shipbuilding Corporation (USC) of Russia to build "river-sea" class tankers for transporting petroleum products. Furthermore, on June 14, 2024, ASCO and Baku Shipyard signed a contract for the construction of three diving vessels designed for operations at depths of up to 45 metres, as well as two tankers with a capacity of 8,000 tons each.

Within the structure of Azerbaijan Caspian Shipping Company (ASCO), there is the "younger sibling" of Baku Shipyard—the Zikh Ship Repair and Construction Yard. The facility is primarily focused on the ongoing and major repairs of vessels in the ASCO and Caspian Sea Oil Fleet (CSOF), as well as manufacturing various spare parts, special coatings, and technical equipment for these vessels. The yard also handles installing and commissioning ship systems and devices, electrical and radio navigation equipment, engines, and instruments. 

In addition, it performs diving and underwater hydraulic works, including repairs to the underwater part of the hull and the propeller-rudder complex. The high qualification of its personnel, coupled with modern equipment in machining, hull welding, foundry, power-mechanical, electrical installation, and dry dock sections, allows the facility to independently assemble vessels from the ground up and equip them with the necessary machinery.

In essence, the Zikh Ship Repair and Construction Yard is Azerbaijan’s second shipbuilding facility, focused on producing relatively small auxiliary vessels, primarily for the needs of Azerbaijan’s offshore oil fields. Recently, the Zikh Shipyard launched the tugboat "Azikh," transferring it to the Caspian Sea Oil Fleet (CSOF). With a length of 24.72 metres, a width of 6.60 metres, and a deadweight of 14 tons, the tugboat, crewed by a team of seven, can reach speeds of up to 9 knots and carry up to three tons of cargo. 

Previously, the Zikh Shipyard built and commissioned tugboats such as "ASCO 1," "Tartarchay," "Hakarichay," and "Bargushadchay." Currently, the shipyard is constructing another vessel in this series, and, with further orders, the laying down of five more tugboats is anticipated. The design of these auxiliary vessels, which meet international standards, was carried out by specialists from ASCO Engineering LLC (Caspmorproject Research Institute).