Board of Directors Report
It is with great pleasure that I, on behalf of Nakilat’s Board of Directors, present to you our Annual Report for the year 2023.
Nakilat’s financial performance in 2023 reflects our unwavering dedication to operational excellence and strategic expansion. This year, our company has not only weathered industry challenges but has also achieved sustainable growth, reinforcing our position as a key player in energy transportation and maritime services.
With a fleet strength of 74 vessels, one of the world’s largest Liquefied Natural Gas (LNG) shipping fleet comprising of 69 LNG carriers, 4 LPG carriers and 1 Floating Storage Regasification Unit (FSRU), the company is the backbone of the transportation link in Qatar’s LNG supply chain. Our LNG fleet has a combined carrying capacity of over 9 million cubic meters, which is about 9.2% of the global LNG fleet carrying capacity. Through its dedicated
in-house ship management, Nakilat operates 30 vessels, 25 LNG carriers, 4 LPG carriers and 1 FSRU. The majority of Nakilat’s vessels are fixed with long-term charterers to reputable local and international counterparties, creating a steady and healthy cash flow for the company.
Our recent fleet expansion with Hyundai Heavy Industries (HHI) in South Korea exemplifies Nakilat’s forward-thinking approach. The acquisition of two cutting-edge LNG carriers and four modern very large LPG carriers reinforces our commitment to technological innovations and environmentally conscious shipping solutions. Scheduled for delivery between 2026 and 2027, these vessels will significantly contribute to our global presence in the LNG shipping sector.
As Nakilat approaches its 20th anniversary since its inception, we reflect on our journey and celebrate the commitment to sustainability that has been integral to our success. This milestone is a testament to the dedication of our team and the support of our stakeholders. We are excited about the future and the continued contributions Nakilat will make to the maritime industry.
Supported by the world-class Erhama Bin Jaber Al Jalahma Shipyard, Nakilat’s joint venture companies continue adding strategic value to our operations through dedicated services, including ship repair, offshore fabrication, as well as a range of maritime services, all of which contribute towards establishing Qatar as a shipping and maritime hub, in support of Qatar National Vision 2030.
The Board is delighted to highlight the achievements of our joint ventures and subsidiaries in 2023:
- Qatar Shipyard Technology Solutions completed 155 repairs for various types of marine vessels and 15 offshore/rig repair projects in 2023.
- NSW surpassed 14 million exposure hours lost time incident (LTI) free in 2023.
- NAC commemorated 18 years of operations in 2023, offering 24/7 shipping, logistics and marine services at all ports and terminals in Qatar. The company provided its agency services to more than 3,500 port calls in Qatar and 2,000 port calls overseas during 2023, without any service failures or LTI.
- QFAB began the fabrication and assembly of four wellhead platform topsides, WHP13N, jacket and subsea infrastructure for the North Field East (NFE) Project and delivered five wellhead jackets for the North Field South (NFS) Project, subsea spools and risers for the North Field Production Sustainability (NFPS) – I1P1 project and the Spent Caustic Treatment Modules (SCTS) for McDermott. QFAB achieved 6 million work hours LTI-free in 2023.
The Board of Directors acknowledges Nakilat for its robust financial performance and operational excellence in 2023. We are delighted to report Nakilat’s net profit of QAR 1.56 billion for the fiscal year, reflecting a 8.3% increase compared to QAR 1.44 billion in 2022. Given our strong financial standing and the anticipated growth opportunities in the coming years, Nakilat’s Board of Directors is pleased to propose the distribution of cash dividends of QAR 0.14 per share for the fiscal year 2023, to the General Assembly.
Nakilat’s Board of Directors would like to express its deep gratitude to HH Sheikh Tamim Bin Hamad Al Thani, the Emir of the State of Qatar, and to HH Sheikh Hamad Bin Khalifa Al Thani, the Father Emir of the State of Qatar, for their visionary and inspiring leadership that have enabled Nakilat’s growth into a diversified shipping and maritime services company that significantly contributes towards the development of Qatar’s maritime and shipping sector.
The Board of Directors also offers its appreciation to HE Eng. Saad Sherida Al-Kaabi, Minister of State for Energy Affairs, President and CEO of QatarEnergy for the ongoing support of Nakilat’s activities and extended cooperation with the Erhama Bin Jaber Al Jalahma Shipyard. We also extend appreciation to our long-term main charterer QatarEnergy LNG for their continued support towards Nakilat’s operations. Finally, we would like to thank Nakilat’s partners, shareholders, management, employees, Qatar Stock Exchange (QSE) and Qatar Financial Markets Authority (QFMA) for their continued dedication and support.
MR. ABDULAZIZ AL-MUFTAH
Chairman of Nakilat Board
EXPLORE THE ANNUAL REPORT
Corporate Strategy
To ensure our focus on achieving our strategic goal, we defined four strategic themes serving as the architecture of Nakilat’s strategy map.
Three of the themes within the strategy map represent Nakilat’s core activities, with each theme hosting a stream of strategic objectives plotted in an upward relational logic.
Corporate Governance
Corporate governance encompasses the systems of rules and practices that are dedicated to ensuring that companies adhere to a suitable and transparent decision-making framework, safeguarding the interests of all stakeholders and shareholders. Nakilat’s board of directors and senior executives are committed to upholding the highest standards of ethical conduct, accountability, transparency, and fairness in all aspects of our business. Our corporate governance framework reflects our dedication to serving the best interests of our shareholders, stakeholders, and the broader community.
Nakilat recognizes the pivotal role that embracing best governance practices and standards plays in aiding the company’s pursuit of its goals and objectives. We place a significant emphasis on transparency and disclosure. Regular interaction with our shareholders through various channels, including annual general meetings, investor conferences, meetings, investor relations quarterly conference calls, and investor relations initiatives, to ensure that current shareholders and potential investors are well-informed about our financial performance, strategic objectives, and governance principles. Furthermore, we are committed to actively listening to all our stakeholders. In addition, we recognize that good corporate governance is an ongoing journey, and we remain dedicated to continuously improving our governance practices to deliver long-term value and sustainable growth for all stakeholders and shareholders.
Acknowledging the intrinsic link between effective governance and robust financial performance, Nakilat is committed to upholding leading and best governance practices, as well as adhering to the governance code set forth by the Qatar Financial Markets Authority (QFMA). Nakilat’s governance report has been meticulously prepared in accordance with the QFMA governance code, reflecting our commitment to meeting all pertinent regulatory stipulations. This report is made accessible to all relevant stakeholders and the public through Nakilat’s website, ensuring transparency and accountability in our governance efforts.
Operational Highlights
Fleet
In 2023, Nakilat continued to operate and manage a wide range of gas ships including LNG Carriers (Q-Max, Q-Flex, MEGI & X_DF), FSRU and VLGCs; chartered to major international oil & gas companies such as QatarEnergy LNG. Apart from the regular operations, Nakilat carriers were involved in the clearance process of various new global terminals with the first commissioning cargoes, following the highest standards of safety and efficiency. The vessels also conducted various commercial ship-to-ship transfer operations in compliance with the best industry standards and practices.
Shipyard
- Qatar Shipyard Technology Solutions
- Completed a total of 170 projects comprising marine vessels, offshore, industrial engineering &
- rig repairs in 2023
- Successfully delivered the Outboard Slot (OBS) Module Fabrication project to North Oil Company (NOC).
- Signed Fleet agreements with major international shipping companies
- Partnerships with major global vendors on Green shipping solutions and services (various MoU’s and contract agreements with Kongsberg, CRS CCS Repair Solution, Actemium, BoilerMan, Toroshima, CPR Pump Repairs Ltd., Aegir Marine, MAN, HSD Engine etc.).
- Purchase of Vertidrive robotic machines to focus on adopting technology and incorporating innovations to enhance operations and deliver value-added solution.
- Qatar Fabrication Company (QFAB)
- QatarEnergy LNG North Field Expansion Project / North Field East (NFXP/NFE) – Commenced construction of four wellhead platform topsides and 8,500 tons of subsea structures.
- QatarEnergy LNG North Field South (NFS) Project – Completed the construction of five wellhead platform jackets.
- QatarEnergy LNG North Field Production Sustainability Project (NFPS) – Commenced the construction of one wellhead jacket (WHP13N).
- McDermott International – Delivered two Spent Caustic Treatment Solution Modules (970 tons) for an Ethane Cracker project.
- Achieved 6 million work hours Lost Time Injury (LTI) free, reiterating the company’s commitment to safety.
- Secured the globally recognized CE mark following a successful audit by the accredited third-party body, Intertek.
Marine Services
- Nakilat Agency Company (NAC)
- Commemorated 18 years of operations, offering 24/7 agency services to 65,000 vessels without any service failures and Lost Time Incidents (LTIs).
- Completed 4 years of strategic partnership with our largest chartering customer to provide global agency services across both load port in Ras Laffan and over 50 destination ports.
- Won 4 major contracts in support of the North Field Expansion to support Qatar’s E&P industry and renewed several others on better terms to support our business strategy.
- Accelerated growth at Doha Heliport, Hamad and Mesaieed ports by adding additional resource to support the development of maritime services in Qatar beyond Ras Laffan.
- Facilitated over 1000 crew movements per month (including medical attendance and ship-to-ship crew transfers) in support of Qatar’s hydrocarbon export logistics.
- NSW
- NSW accrued 14.6 million exposure hours without incurring Loss Time Incidents (LTIs).
- A new record of 14,354 tug jobs were performed for QatarEnergy at Ras Laffan Port, about 2.2 % higher than
- Maintaining performance of uninterrupted services with a 99.92% technical up time across the fleet.
- The Port of Ras Laffan honored NSW with a Gold Award during its ‘7 Star Safety Audit’.
- Vessel Support Services (VSU)
- Around 3500 orders of various types have been handled by VSU services at Ras Laffan for Nakilat-owned, joint-venture and third-party vessels.
- Clearance and delivery of critical spares to Nakilat and JV vessels at Ras Laffan, an average of 364 movements per month.
Sustainability at Nakilat
Nakilat and its joint ventures (JVs) are committed to Qatar National Vision 2030, which outlines the development of a sustainable future for the State of Qatar. As an organization, we conduct various safety and internal development programs to ensure the creation of a safe and reliable workforce, while our robust corporate social responsibility (CSR) framework aims to enrich the lives of local communities and preserve our natural environment
Safety Excellence
The company’s solid safety performance reflects the effort and dedication of staff both at sea and ashore. Nakilat’s prime objective is to achieve an ‘Incident and Injury Free (IIF)’ work environment and our 2021 safety results greatly complement our commitment toward being IIF.
Crew Welfare
People are the foundation of the organization’s success and they contribute to operational excellence. Crew welfare is one of the company’s highest priorities. Post-pandemic measures have been put in place in order to further protect our seafarers against covid, which is still present in several areas of the world. Nakilat has developed initiatives towards improving work-life balance for crew members. We have introduced promotion programs for junior engineers and cadets and improved rotation schedules. We have taken several measures to support improved lifestyle on board. Our seafarers have reliable high-speed internet connection on board to stay in touch with their families, which is provided by communications equipment in combination with effective cybersecurity management.
Nakilat continues to monitor and evaluate through an employee feedback survey utilizing an independent third-party professional organization to identify, the perception of our seafarers against the measures we are putting in place for their wellbeing as well as their job satisfaction. This involved introducing healthy mental wellbeing initiatives to support establishing a positive environment onboard. New projects are focused on continuity of improvement of conditions for seafarers. Nakilat continued building high calibre resources in line with our vision on project expansion. 2023 was an exceptional year on training and development of Qatari seafarers, enabling them to reach senior ranks.
Furthermore, tailored programs have been completed for national officers covering shore-based training for various ranks on Ship-Simulation, Bridge-Team Management, Navigational-Skills-Assessment & Development Programs.
Human Capital & Capability Development
Professional and personal development of our most strategically important assets, our employees, remained in sharp focus during 2023. Nakilat continued to utilize our blended learning approach with the delivery of 88% of the training programs virtually.
A substantial 8,927 hours of training was delivered by experts from both external providers and our internal teams to employees from all divisions of Nakilat. Our Learning Academy, established in 2021, continuously served as a hub of profound learning through 2023, offering Nakilat employees access to an extensive array of over 9,000 courses and resources through e-learning courses and LinkedIn learning programs.
In 2023, we marked the achievement of guiding three cohorts of leaders through the Georgetown University Leadership Development Program. Cohort 1 concluded their journey in Q3 of 2022, and Cohorts 2 and 3 have completed in Q1 of 2023. A graduation ceremony was held in February 2023 to celebrate the achievements of these leaders.
Throughout 2023, our commitment to nurturing the upcoming leaders in our business remained evident and this was reflected in our comprehensive succession planning process.