MISC Annual Report 2017

MISC BERHAD | Annual Report 2017 102 Construction of the newDry Dock No. 3 is on track with operations scheduled to commence in 2020. The strategic investment into a new dry dock will provide MHB additional capacity and the flexibility to take on a variety of diverse dry docking works. The Joint Venture (JV) company established in August 2016 with Eastern Pacific Industrial Corporation Berhad (EPIC) – MMHE EPIC Marine and Services (MEMS), has commenced its operations in April 2017. MEMS received its maiden vessel, RV Discovery (a research survey vessel) on 27 April 2017. OUTLOOK The outlook for Heavy Engineering segment is expected to remain challenging as Oil Majors continue to be cautious on their spending and CAPEX for upstream activities is projected to remain limited. On the other hand, new investments into the downstream segment as refiners are taking advantage of the lower cost of raw materials will result in more onshore module fabrication and construction projects that MHB can capitalise on. Opportunities for onshore maintenance services are also anticipated to increase over the next three years as RAPID is scheduled to start operation by 2019. With emerging markets especially in Asia and Middle East showing positive LNG demand growth, there will be more opportunities for MHB in LNG carrier repair business. With the additional capacity from Dry Dock No. 3, which is currently under construction, allows MHB to capitalise on the expanded market. MANAGEMENT DISCUSSION & ANALYSIS MARINE & HEAVY ENGINEERING