MISC Annual Report 2017

MISC BERHAD | Annual Report 2017 78 PRESIDENT/GROUP CEO ’ S REVIEW Larger scale FPS projects were mainly centred in the Atlantic Basin where the pace of activity had picked up, whilst smaller scale FPS awards were the norm in Southeast Asia. Deferment or cancellation of offshore projects due to the prolonged Oil & Gas sector slump, saw the Marine & Heavy Engineering segment focusing its efforts on managing costs, optimising its resources and improving operational efficiency to combat the challenging environment. While the Marine & Heavy Engineering segment successfully secured several offshore fabrication projects during the period, the bulk of the contributions from these projects will only be realised in 2018 and beyond. Notwithstanding this weak backdrop, MISC still managed to make steadfast progress on several fronts. On the LNG Shipping front, MISC took delivery of the Seri Cenderawasih and Seri Cempaka in January and August 2017 respectively. The second and third newbuilds in a series of five MOSS-Type LNG carriers ordered from Hyundai Heavy Industries Co., Ltd., are bolstering MISC’s position as a reliable and safe transporter of LNG globally. In February 2018, the segment also took possession of a fourth LNG carrier, the Seri Camar. These vessels join our fleet as our 26 th , 27 th and 28 th LNG Carriers respectively. The LNG Shipping segment also went on to chalk up several firsts including the successful completion of the segment’s first of multiple Ship-to-Ship (STS) LNG transfers, and its first commercial cargo load to the Regasification Terminal 2 in Pengerang, Johor. The Petroleum and Product Shipping segment, helmed by AET, too made strong strides forward. The segment landed a noteworthy three-year global Aframax Contract of Affreightment (COA) with an Oil Major, the first of its kind in the world. AET also bagged a contract to provide two Dynamic Positioning Shuttle Tankers (DPSTs) to Norwegian Oil Major, Statoil. Moreover, AET captured a significant portion of the growing reverse lightering business in the US Gulf, bolstering its US presence. To improve sustainability of the Product Shipping segment, AET had time chartered out vessels and participated in a tanker pool. The segment also took delivery of the first two LR2 product tanker newbuilds as part of an ongoing plan to shore up its product asset portfolio. As part of its ongoing fleet renewal programme, AET took delivery of one Aframax, Eagle Barcelona in January 2018, with the other Aframax, Eagle Brisbane, scheduled for delivery in March 2018. Two more Aframax tankers, which are scheduled for delivery from the third quarter of 2018 onwards are currently under construction at Samsung Heavy Industries Co., Ltd. and will be equipped with LNG dual fuel options in line with the company's commitment to further improve its environmental footprint. A un i ted , strengt hened and focused MISC w i ll certa i nly be a force to be reckoned w i t h as we pursue growt h opportun i t i es and cont i nue to "move energy to bu i ld a better world ".