MPSV Botnica's 10-year icebreaking service to the Transport Administration
OÜ TS Shipping, a subsidiary of AS Tallinna Sadam, won a public tender organized by the Estonian Transport Administration for the provision of icebreaking services and navigation in the Gulf of Finland in the period 20.12.2022-20.04.2032. The icebreaking service in Estonian coastal waters is provided with the multifunctional icebreaker Botnica, similarly to the previous 10-year charter agreement, annually from December 20 to April 20. The agreement will be signed in the near future in accordance with the conditions set out in the procurement and the offer.
The total estimated cost of the agreement to be concluded is EUR 54.2 million, i.e. EUR 5.4 million per year. From the 2025/2026 working period, the contract fee may be indexed with the Estonian consumer price index, but not more than 3% annually. The contract fee is fixed, i.e. the Transport Administration pays for all charter days, regardless of the actual use of the icebreaker.
Compared to the icebreaking service agreement of the previous 10-year period, there is an additional condition to bring a replacement vessel for service within 10 days in case the contracted main vessel Botnica should fall out of use. Among other things, we mitigate this risk by increasing the reliability of Botnica's vital systems.
MPSV Botnica was built at Aker Finnyard shipyard in 1998. The ICE-10 / Polar Class 4 ice class carrying vessel is 97.3 meters long and 24.3 meters wide. In open water, Botnica has a maximum speed of 16.5 knots, and in ice up to 80 cm, the ship can move at speeds of up to 8 knots. The maximum thickness of ice that Botnica can pass at a steady speed is 1.2 meters. During the summer periods from June to the end of October, Botnica assists Panamax-type merchant vessels in the Arctic waters of northern Canada in the export of iron ore from the port of Milne Inlet to the high seas. According to the charter agreement, Botnica provides escort and ice monitoring vessel service, pollution monitoring and emergency services. The total number of Botnica charter days in 2020 was 249 days and the annual utilization rate of the ship was 68%, in 2019 261 days and 72% accordingly.
Tallinna Sadam is one of the largest cargo- and passenger port complexes in the Baltic Sea region, which serves annually 10 million passengers and 20 million tons of cargo in average. In addition to passenger and freight services, Tallinna Sadam group also operates in shipping business via its subsidiaries – OÜ TS Laevad provides ferry services between the Estonian mainland and the largest islands, and OÜ TS Shipping charters its multifunctional vessel Botnica for icebreaking and construction services in Estonia and offshore projects abroad. Tallinna Sadam group is also a shareholder of an associate AS Green Marine, which provides waste management services. According to audited financial results, Tallinna Sadam group’s sales in 2019 totaled EUR 130.5 million, adjusted EBITDA EUR 74.3 million and net profit EUR 44.4 million.
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