MISC Annual Report 2019

Our Core Businesses and Activities OFFSHORE BUSINESS MARINE & HEAVY ENGINEERING HUMAN CAPITAL HUMAN CAPITAL SERVICES PERFORMED • Engineering, procurement, construction, installation, commissioning, operations & maintenance, decommissioning and demobilisation (EPCICODD) solutions • Operate offshore assets to extract, store and offload the hydrocarbons to shuttle tankers • Provide operations and maintenance services for offshore floating assets SERVICES PERFORMED • EPCIC services for offshore facilities such as deepwater facilities and fixed platforms • Fabrication services for onshore modules • Marine repair, refurbishment and conversion • Plant maintenance and turnaround services PHYSICAL CAPITAL • 2 fully equipped yards in Pasir Gudang • 2 dry docks • 1 dry dock under construction • 2 land berths • LNG carrier repair facilities • Floating dock (Kemaman Supply Base) • Workshops • Cranes PHYSICAL CAPITAL * Resources belong to customer ACTIVITIES Provide full scope of services from design to operation and decommissioning of floating assets for small, marginal and deepwater field development: • EPCICODD • Operate offshore floating solutions • Maintenance for offshore floating assets CUSTOMERS • PETRONAS Group • Energy majors • NOCs REVENUE STRUCTURE • Revenue from time charter contracts and bare boat charter contracts • Non-shipping income generated from operations and maintenance of offshore floating assets COST STRUCTURE • Operational costs such as employee/crew costs, repair and maintenance, materials and supplies as well as professional and purchased services and depreciation ACTIVITIES • Heavy Engineering segment: – Provides a wide range of EPCIC services of offshore and onshore facilities for the oil and gas industry • Marine segment: – Provides comprehensive marine services including dry docking repair, refurbishment, upgrading and conversion of wide range of vessels and rigs • Plant Maintenance & Turnaround segment (new): – Provides shutdown and turnaround maintenance, routine maintenance and upgrading works for onshore plant • Centre of excellence: – Owns and operates a one-stop centre training provider for heavy engineering and marine industry CUSTOMERS • PETRONAS Group • NOCs • Production sharing contract (PSC) contractors • EPCC contractors (offshore and onshore) • Petrochemical companies • Domestic and international shipping companies REVENUE STRUCTURE • Construction and conversion contract revenue based on stage of completion • Marine repair income COST STRUCTURE • Operational costs such as for labour and subcontractors, materials and supplies, as well as professional and purchased services and depreciation RESOURCES* • Hydrocarbons from the sea RESOURCES USED • Raw materials comprising mainly steel 909 Employees 2,134 Employees FPSOs and FSOs today have become the effective way of extracting hydrocarbon for many offshore oil and gas producing regions around the world. The vessel sizes depend on the oil and condensed storage capacity requirements and the vessels are secured to the seabed via mooring systems which are determined by the environment where they operate. 6 VESSELS FLOATING PRODUCTION, STORAGE AND OFFLOADING (FPSO) An FPSO unit is a vessel-type production system that receives full well stream fluids such as crude oil, water and others from a subsea reservoir through risers. It has topside production facilities that separate the fluids into crude oil, natural gas, water and impurities. It also has storage tanks where processed crude oil is stored. Crude oil is offloaded onto shuttle tankers for further refining onshore. It can be designed with the capability of staying on location for continuous operations for 20 years or longer. An FSO unit is simpler than an FPSO as it does not have production processing capabilities. It is normally integrated with other production systems such as fixed platforms, MOPU, tension leg platforms (TLP) among others. An FSO is also equipped to store and offload crude oil to a shuttle tanker. A MOPU is a mobile structure for offshore well production, operating in shallow waters. It has production facilities to process oil and natural gas and export oil through subsea pipeline to an FSO. A semi-submersible FPS is a large pontoon-like structure submerged below the sea surface at a predetermined depth with a floating production system that receives fluids such as crude oil, water and others from a subsea reservoir through risers. The topside production facilities separate the fluids into crude oil, natural gas, water and impurities. Our semi-sub FPS operates at a depth of 1,400 metres. The oil is exported via a 200-kilometre long pipeline to an oil and gas terminal in Kimanis, Sabah. MOBILE OFFSHORE PRODUCTION UNIT (MOPU) SEMI-SUBMERSIBLE FLOATING PRODUCTION SYSTEM (FPS) 5 VESSELS 2 UNITS 1 UNIT FLOATING STORAGE AND OFFLOADING (FSO) We have the largest fabrication area by tonnage capacity, to provide engineering, procurement, construction, installation and commissioning (EPCIC) of complex structures for offshore and onshore facilities. HEAVY ENGINEERING ASSETS MARINE BUSINESS ASSETS Our well-equipped yard includes dry docks, land berths, quays and a shiplift. These facilities enable us to perform repair works, maintenance, marine conversion and refurbishment of a wide range of vessels. • 14 offshore floating solutions • 1 FSO under conversion 45 44 MISC BERHAD PEOPLE. PASSION. POSSIBILITIES ANNUAL REPORT 2019 OUR BUSINESS