The U.S. Bails Out Elefsina Shipyard in Greece with $125 Million Loan

The Elefsina shipyard in Greece has entered into a financial agreement for a $125 million loan with the US International Development Finance Corporation (DFC) to upgrade and modernize its aged facilities.

The shipyard, just outside Athens, is attempting to be restructured through bankruptcy law after it couldn’t sustain itself, falling 423.3 million euros ($462.16 million) into debt.

DFC Chief Executive Officer Scott Nathan signed the deal with ONEX Elefsis Shipyard and Industries (ONEX) and said the group “is proud to advance this high-quality infrastructure project that will generate more reliable access to energy and foster greater economic growth and prosperity for our partners across the region.”

The US Embassy in Athens says that DFC financing will help create a strategically critical maritime and energy supply hub for the region.

It will expand the shipyard’s capacity to service liquified natural gas (LNG) ships, promote European energy security and diversification, create new local jobs, and bolster the U.S.-Greece partnership through a transparent, high-quality investment, it adds.

Elefsina shipyard to become “maritime and energy supply hub”

“DFC’s investment in the Elefsina shipyard will develop a maritime and energy supply hub that will create good local jobs here in Greece and help the country and region become less reliant on Russian energy,” said DFC CEO Scott Nathan.

CEO Nathan joined Greek Minister of Development and Investment Kostas Skrekas and U.S. Ambassador to Greece George Tsunis at the shipyard for the signing ceremony.

With DFC support, ONEX will expand the shipyard’s capacity to repair and upgrade ships, particularly ships that service the nearby Revithoussa LNG terminal.

This will promote increased access to reliable, secure energy in the Western Balkans and Eastern Europe by expanding high-quality infrastructure to support the diversification of LNG supply for the region – a critical undertaking amid Russia’s attempts to destabilize regional energy access.

“I am thrilled to help launch the ONEX Shipyards and DFC’s $125 million partnership to reopen and rehabilitate Elefsina Shipyard,” said the U.S. Ambassador to Greece George Tsunis.

“Together the U.S. and Greece are restoring Elefsina as a world-class maritime center, creating up to 1,000 jobs and shared prosperity for our countries through transparent partnerships.”

Thrilled to help launch @ONEXShipyards @DFCgov $125 million partnership to reopen and rehabilitate Elefsina Shipyard. Together the U.S. and Greece are restoring Elefsina as a world-class maritime center, creating up to 1,000 jobs and shared prosperity for our countries through… pic.twitter.com/E3gpJtEquY

— George J. Tsunis (@USAmbassadorGR) November 7, 2023

Shipyard to become largest in Greece

The history of the shipyard dates back to 1962, when its construction started and its operation commenced in October 1969. It is located in Elefsina Bay approximately 10 nautical miles from the anchorage of Piraeus, Greece’s biggest port.

It covers an area of 250 thousand square meters offering construction, repair and modification facilities.

While Greek shipping tycoons rule the world’s waves, shipbuilding in the country lagged for years, with ships being bought elsewhere to build the fleet, seeing Elefsina fall into decline.

The funding, which was approved by Congress, will be used to restore and upgrade the shipyards, increasing the service capacity to up to 200 ships per year and getting Greece back into the sector.

In addition, the new facilities will include a 30MW solar farm to provide energy to the shipyard and to the local grid. The upgrades will include repurposing part of the shipbuilding infrastructure for the fabrication and assembly of wind turbines.

When fully operational, ONEX Elefsis Shipyards, owned by businessman Panos Xenokostas, plans to become the largest shipyard in the country that will serve the Greek Navy and commercial fleets.