MISC Annual Report 2017

97 Strategy & Performance The segment has a current fleet strength of 14 floating solutions comprising six Floating Production Storage and Offloading Units (FPSOs), five Floating Storage and Offloading units (FSOs), two Mobile Offshore Production units (MOPUs) and one Semi-Submersible Floating Production System. These are primarily located in Malaysian waters and include the largest FPS in Asia, the Gumusut-Kakap Semi-Submersible Floating Production System. Today, the Offshore Business segment owns some 50% of the total floating facilities in Malaysia. The Offshore Business segment continued its excellent asset performance in 2017, registering more than 99% uptime. It also continued to demonstrate outstanding Health, Safety & Environment (HSE) performance, recording a zero lost time injury frequency rate for both 2015 and 2016 and registering only one lost time injury incident in 2017. MARKET REVIEW The Offshore Business segment continued to face challenging market conditions in 2017. Just like their global counterparts, Malaysian FPSO players experienced a dip in orders as investments in Oil & Gas projects were scaled down. The year saw a similar pattern as the previous year in terms of spending cuts and deferred FIDs. To mitigate the impact of low oil prices, many offshore oil service providers received client requests to reduce contracted charter rates or even faced termination of their charter contracts. Several postponed FIDs were restarted over the course of the year. This included six FPSO awards, two of which were in South America, two in Southeast Asia, one in Africa, and another in the United Kingdom. There was also a major shift in regulatory frameworks in some of the countries with Brazil and Indonesia indicating their willingness to relax some of their nationalistic policies and waive some local content rules. India also indicated a willingness to open up its market to new service providers. MANAGEMENT DISCUSSION & ANALYSIS OFFSHORE BUSINESS One of the WORLD'S LARGEST FPSO / FSO owner-operators with 14 ASSETS Owns 50% of the total floating facilities in Malaysia Excellent asset performance with uptime of over 99% Further details on Offshore Business www.misc.com.my/solutions/ offshore-business