Yinson Annual Report 2021

65 ANNUAL REPORT 2021 FPSO MARKET (CONT'D.) OVERVIEW RISKS OPPORTUNITIES YINSON’S STRATEGIC RESPONSE IMPACT t 4PNF PJM DPNQBOJFT revisited and optimised their development strategies in 2020 to reduce capital expenditure and make projects more financially robust. The exercise also increased demand for leased FPSOs compared to owned units and shows a trend towards acceptance of contractor standards. t .BOZ PJM DPNQBOJFT are considering FPSO redeployment opportunities as this can result in considerable operational cost savings and quicker delivery schedules. t 'JOBODJOH DPVME CF more challenging as providers may prioritise other investments. t *ODSFBTJOH JOUFSFTU GSPN clients and financiers for environmentally friendly FPSOs will benefit contractors who focus on energy efficiency and minimisation of emissions. t *ODSFBTFE PQQPSUVOJUJFT for companies that strategically target redeployment projects. t 8F IBWF QSJPSJUJTFE maintaining the special skillset needed to execute FPSO redeployment projects efficiently and are well positioned to take on several such projects. t :JOTPO IBT DPOUJOVPVTMZ increased our focus on environmentally sustainable FPSO solutions and is taking further major steps in 2021. t %FWFMPQFE ;FSP Emissions FPSO Concept. REGULATIONS OVERVIEW RISKS OPPORTUNITIES YINSON’S STRATEGIC RESPONSE IMPACT t 1PMJDZNBLFST XPSMEXJEF face an increasingly urgent task of making the energy system more sustainable and climate- friendly. t TBX B SJTF JO Covid-19 driven regulatory changes to increase occupational health and safety (“OHS”) requirements on FPSOs. t 5IF *OUFSOBUJPOBM Maritime Organisation (“IMO”) adopted a resolution that obligates maritime operators to update their safety management systems to appropriately address cyber risks by their 2021 annual verification. t 1PTTJCMF BEPQUJPO of carbon tax across different jurisdictions. t .VMUJMBUFSBM governance pressures on corporations to provide mandatory climate disclosures may adversely affect corporations who are not adequately prepared. t 3FHVMBUPSZ DIBOHFT UP comply to Covid-19 driven OHS standards may lead to changes in working practices that affect continuity of operations. t $PSQPSBUJPOT NBZ mOE it challenging to comply with the increased technical upgrades and documentation required to manage cyber threats. t 8PSMEXJEF QPMJDJFT towards a more climate-friendly energy system has opened up new business opportunities in energy efficiency and renewables, hence creating a demand for more emissions-friendly assets. t $PNQBOJFT UIBU demonstrate exemplary compliance to Covid- 19-driven OHS and cyber security regulations may become industry leaders in those areas, inspiring investor confidence and building business resilience. t :JOTPO IBT EJWFSTJmFE our business interests beyond oil & gas to become a mixed energy solutions company. t :JOTPO JT QFSGPSNJOH technical assessments to determine the most feasible methods to reduce Group-wide carbon emissions. t 8IFSF QPTTJCMF :JOTPO aims to adopt practices that go beyond local and regional compliance obligations, in accordance to our strategic plan. This applies to all regulations including the increased OHS requirements due to Covid-19, and the IMO cyber security regulation. Stakeholder groups Materiality Capitals S1 S3 S2 S5 S6 S7 S9 M3 M6 M4 M7 M8 M15 M21 M19 M20 EXTERNAL ENVIRONMENT C4 C6 C1 C2 C3