44 YINSON HOLDINGS BERHAD STRATEGY & OUTLOOK GROUP CEO REVIEW We believe that how we embrace the energy transition, manage its risks and capitalise on its opportunities are crucial to our continued ability to maintain our growth trajectory and remain relevant to the needs of the global energy supply chain and the communities around us. Modern energy is inseparable from human livelihoods and it is directly linked to wellbeing, prosperity and development. This is because energy supports economic and social progress – manufacturing, trade, modern agriculture, transportation, communication, services – especially in developing countries, where reliable, affordable energy infrastructure is needed to help people escape poverty and create better lives. Yinson’s aim is to help manage the stability of the energy transition for the broader community, so that as many people as possible, have access to as stable as possible an energy supply, for as cheap as possible. We believe that embracing the energy transition doesn’t mean that we rush the departure of fossil fuels from the energy mix. After all, it is currently still the dominant form of energy supply, and therefore the most affordable and viably accessible. Transitioning away from fossil fuels too fast when alternative solutions have yet to be scaled up to reach critical mass or establish themselves accordingly in the supply chain could potentially drive all energy prices up – something that will affect everyone and developing communities more severely than developed ones. Yinson’s diversification into renewables and green technologies is an important prong of how we aim to embrace the energy transition. Through Yinson Renewables, we invest into the entire renewables value chain, with a current focus on onshore wind and solar. When we increase the energy output from the renewables sector, we contribute to the strengthening of market mechanisms that bring this energy to the masses, which lowers costs for the end user, ultimately enabling it to become a larger contributor to the energy mix. Through Yinson GreenTech’s investments into the electrification of the marine, mobility and battery segments, we aim to create an ecosystem that runs on cleaner energy. By building physical infrastructure and assets that run on electricity, we are able to create a higher demand for clean energy sources, which directly also encourages alternative energies’ higher contribution to the energy mix. We aim to scale up on these investments significantly in the coming years, in line with our strategy for embracing the energy transition. The second prong is through the responsible management of our offshore production business. Given our excellent project and operations performance track record, and our leadership position in ESG within the industry, we believe that we should continue to play our part in the energy supply chain for as long as oil & gas is still needed in the energy mix – which is for many decades to come. Yinson Production continues to be Yinson’s strongest cash flow pillar, and we believe we should continue investing into its continual development in order to unlock its value. The cash flows from this division allows us to exponentially scale up our renewables and green technologies businesses, whilst also achieving Yinson Production’s goals of delivering reliable, affordable energy globally. As a Group that has sustainability at our core and that has set the lowering of our fleet’s emissions as a non-compromisable key performance indicator (“KPI”), we believe we bring the extra edge when it comes to executing FPSO projects in line with the evolving trends of the energy transition. We will continue to carefully select projects which we execute by carefully selecting our clients and projects that meets our climate goals as well. We envision a day where we can provide reliable, affordable and clean solutions to the energy supply in countries that we work. INVESTING IN EMERGING TECHNOLOGIES AND DIGITALISATION Ongoing technological advancement is one of the biggest forces shaping the modern business landscape. We believe that in order to keep our edge as a leader in our fields, we need to capitalise on emerging technologies and innovative digital tools that can be enablers for the cutting-edge growth of our business divisions. Our investments are guided by a thoughtful strategy that considers how the technology impacts productivity, asset lifecycles, scale-up potential and long-term business sustainability. As an example, I invite you to read a technology highlight from our ALM team.
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