MISC Integrated Annual Report 2020

///// Sustainability / Financial Review / Business Review / Leadership / Governance /// MISC Berhad / Integrated Annual Report 2020 7 168 MISC Berhad / Integrated Annual Report 2020 7 169 /// Governance / Leadership / Business Review / Financial Review / Sustainability ///// Section Section MOVING FORWARD In view of the ongoing recovery of oil demand and price coupled with the drawing down of oil supply, a rebalanced oil market is imminent. Deferred projects in 2020 are expected to be revived and sanctioned by oil majors in 2021 on the international and domestic fronts. Although the oil market is on the path of recovery, the rate of global COVID-19 vaccines availability and distribution will either derail or accelerate the progress. Should oil prices continue to climb slowly, the timing of capital spending by oil majors remains uncertain. LNG demand is anticipated to continue on its growth trend and to account for larger market share in 2021. The increasing demand for LNG is due to its different market dynamics compared to the oil market. Tanker ton-mile and oil trade should recover in tandem with improvement in oil demand upon the successful deployment of vaccines to the world population. Increase in economic activities from impending unrestricted mobility across the globe should also improve containership trade. As we step into the year ahead, MHB is starting the year with an orderbook of approximately RM1.9 billion in projects. Coupled with our foray into the offshore windfarm sector, we remain optimistic in making the most of opportunities MARINE & HEAVY ENGINEERING Sustainability Pillar Initiatives and outcomes Communities In 2020, we contributed to the wellbeing of communities through the following means. 1. Community Programmes We implemented various community centred programmes which benefitted some 1,409 individuals. The programmes were conducted by 56 MHB employees who volunteered 2,863 hours of their time in their efforts to give back to society. Among the programmes were the sponsorship of the PETRONITA Virtual Orchid Run, and donating RM5,000 to the Ministry of Defence’s Engineering Division Welfare Fund (Tabung Kebajikan Bahagian Kejuruteraan). Towards nurturing a future generation of creative thinkers, we conducted the Art of Science programme in collaboration with EcoKnights. Key highlights included a Waste to Arts Workshop, an interactive online class that focused on utilising waste and recycled household items into valuable art that was held via Google Meet. A total of 30 students and teachers from Sekolah Menengah Kebangsaan Dato’ Penggawa Timur (SMKDPT) attended the event. We also implemented the MHB Go Green programme in replacement of the previous MHB Knights of Nature Youth Camp. The new programme featured a more refined and impactful approach to raise environmental awareness amongst the younger generation. We crafted a full-fledged environmental education programme for SMKDPT consisting of environmental activities focusing on issues related to air, water and waste management to be rolled out over a period of two years. 2. COVID-19 Assistance Towards assisting MHB’s own employees and subcontractors that were undergoing difficulties due to the pandemic, we held an e-Donation drive which raised a total of RM43,063. We also conducted COVID-19 tests for a total of 50 individual subcontractors. As well as that, we contributed personal protective equipment (PPE) for medical front liners at Hospital Sultanah Aminah and Hospital Permai, Johor. We also contributed 1,050 packed meals to medical front liners, that were prepared by nine canteen operators from MMHE West Yard, Pasir Gudang. Basic food supplies were donated to 33 underprivileged families from Kampung Orang Asal Seletar in Kampung Pasir Putih, Pasir Gudang. available in the near-term future. The expanded capacity we now enjoy with DD3 will play a key role in our medium-term expansion and business growth. Although we expect the operating environment to remain challenging in the interim, we will employ a prudent approach in assessing our strategic growth opportunities. In December 2020, MHB logged a significant milestone in our strategic growth journey by commencing operations on our newly completed Dry Dock No. 3 (DD3). DD3 complements our existing assets of two dry docks and one floating dock to conduct repair and refurbishment services on vessels and other marine and oil and gas facilities. The 350-metre long, 80-metre wide and 14-metre deep dry dock has the capacity to cater to all vessels sized up to 400,000 dwt. DD3 can also accommodate the concurrent co-docking of smaller vessels when it is not in use for LNGCs, FPSOs or FSOs. The dry dock comes fully equipped with supporting facilities such as cranes, workshops, special equipment, offices and substation docks. The first vessel to enter MHB’s newly built DD3 was the vessel CSAV TOCONAO , a container vessel owned by one of our long-term collaborators, Zodiac Maritime. The TOCONAO arrived to undergo repair and maintenance works at our new dry dock. Since the beginning of our collaboration with Zodiac Maritime in 2001, we have successfully completed a total of 25 dry docking repairs on their vessels utilising our dry dock, land-berth and quay facilities. Our additional dock space has sharpened our competitive edge and put us ahead of the curve amongst our regional peers in the marine repair industry. This investment will enable us to capture more value in the years ahead to cater to the needs of clients who require works conducted on their vessels. Since MHB’s incorporation, we have successfully completed more than 3,800 marine repair works, including several life extensions and upgrading solutions for various vessels owned and operated by local and international clients. We are committed to continue delivering high- quality, value-added and cost-efficient services to our clients, and possess a comprehensive track record of more than 34 FPSO, FSO, and floating storage units conversions. HERALDING A NEW ERA OF GROWTH AT MHB