MISC Integrated Annual Report 2020

MOVING FORWARD Going into 2021, global LNG demand and supply is expected to grow, off the back of forecasts for LNG prices to rebound, while economic activity normalises. LNG demand is set to incrementally increase, which will help stabilise excess market supply. It is anticipated that ship operating costs will increase due to new regulations being introduced around the world post IMO 2020 that focuses on the building and operating of vessels, as well as COVID-19 related health and safety requirements. The shipping industry is increasingly adopting IR4.0 technologies to leverage on the benefits of digitalisation. In order to remain competitive and relevant, shipmanagers will have to be at the forefront of these developments. Among the technologies being incorporated are the Internet of Things (IoT) to improve the monitoring of shipboard systems, Internet of Services (IoS) to increase the use of shore-based services, Cyber-Physical Systems (CPS) to increase instrumentation and integrated ship control, and Big Data (BiD) to increase the use of data analysis to optimise operations. New entrants to the market have speculatively ordered LNGCs anticipating a spike in demand. However, most ship owners either do not possess the inhouse expertise, or severely lack experience in owning and managing LNGCs and specialised vessels. With Eaglestar’s established track record in managing gas carriers, and conventional and specialised tankers such as VLECs, DPSTs and LBVs, among others, we are in a strong position to capture promising growth opportunities. For the year ahead, Eaglestar plans to drive business growth by increasing the external vessels under our management. In line Sustainability Pillar Initiatives and outcomes Environment In line with MISC’s sustainability commitment to care for the environment and operate responsibly, and in support of the IMO’s targets towards industry decarbonisation, we have instituted the following measures: • Enhancing energy efficiencies by leveraging on technology to improve vessel navigation and optimise speed • Adopting high performance anti-fouling paint on vessels to improve energy efficiencies and reduce the vessel’s carbon footprint • Made significant inroads into the Joint Development Project that we had established with our strategic partners across the value chain the previous year. We worked on feasibility studies focusing on fuel tanks, fuel supply system and the main engines that utilise ammonia as a zero-carbon fuel. This collaboration is extremely significant as it allows the consortium to combine our resources and take leadership in identifying innovative ways to progress with our strategic sustainability aspirations. Read more on the Castor Initiative on page 120 of this Integrated Annual Report. Within our shipmanagement role, Eaglestar is involved in the retrofitting of scrubbers for the fleet we manage, to uphold our role in ensuring compliance with IMO 2020 regulations on sulphur emission. We also contributed towards biodiversity conservation by improving ship design, through collaborations with our customers to install a Ballast Water Treatment System that will maintain the balance of the marine ecosystem by removing biological organisms such as zooplankton, algae, bacteria in ballast water during the discharge process. Towards promoting the Circular Economy, Eaglestar has ceased the supply of bottled water onboard vessels and have substituted plastic wrapping on inventories with bio-degradable materials. We have also encouraged our suppliers to ‘Go Green’. MISC supports the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships which aims to ascertain that ships which are being recycled at the end of their operational life-cycle do not pose any unnecessary risk to human health and safety, or the environment. Eaglestar is assisting our clients by ensuring ship components are dismantled and discarded or recycled in a sustainable and green manner. We make sure that all vessels are in a gas-free condition, with the exception of bunker tanks, as well as free of asbestos prior to the dismantling process. We keep an inventory of hazardous material on behalf of ship owners in line with the Hong Kong Convention. Community We actively interacted with the relevant port authorities, suppliers and local communities within which we operate. Towards building a future-ready workforce for the maritime sector and ensuring a sustainable pipeline of seafaring talent, Eaglestar continued to collaborate with ALAM in the cadet sponsorship programme to sponsor 139 cadets. with a rapidly changing environmental expectations from the IMO as well as our clients, Eaglestar will position itself as a first choice shipmanager for green shipping. Leveraging on digitalisation as a key enabler towards achieving operational excellence, we will continue to bring value to our clients by providing them with optimised operational expenditure and costs. Underlying this is our firm commitment to continuously upskill our people, as we continue to build a dynamic workforce, fully capable of responding to shifting market trends and a challenging operating environment. We believe our focused approach will mark out our competitive edge in a challenging global shipping sector. INTEGRATED MARINE SERVICES ///// Sustainability / Financial Review / Business Review / Leadership / Governance /// MISC Berhad / Integrated Annual Report 2020 7 176 MISC Berhad / Integrated Annual Report 2020 7 177 /// Governance / Leadership / Business Review / Financial Review / Sustainability ///// Section Section