Harland & Wolff (HARL) 2020年年度報告「LSE」.pdf

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1、Uni t ed Ki ngdom Regi st er ed Offi ce Riverbank House 2 Swan Lane London,EC4R 3TTwww.i nfr ast r at apl Registration number:06409712 InfraStrata plc Annual Repor t and Fi nanci al St at ement s for t he Year Ended 31 Jul y 2020 Perivan 259409Company Infor mat i on Di r ect or s Mr C R Richardson(N

2、on-Executive Chairman)Mr M J M Groat(Non-Executive Director)Mr J M Wood(Executive Director)Mr A S Raman(Executive Director)Company secr et ar y Fieldfisher Secretaries Limited Regi st er ed offi ce Fieldfisher LLP Riverbank House 2 Swan Lane London EC4R 3TT Independent Audi t or s PKF Littlejohn LLP

3、 15 Westferry Circus London E14 4HD Account ant sAventus Partners Limited Hygeia Building Ground Floor 66-68 College Road Harrow Middlesex HA1 1BE Har l and&Wol ff Bel fastIsl andmagee Gas St or age Pr oj ectFSRU pr oj ectCOMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGI

4、C REPORTCHAIRMANS REPORTHar l and&Wol ff Appl edor e London Infr ast r at a Headquar t er sI nf r aSt r at a Pl c Annual Report and Financial Statements 2020 x 014 Chairmans Report 8 to 30 Chief Executive Officers Strategic Report 32 to 35 Chief Finance Officers Report 36 to 45 Directors Report 46 t

5、o 49 Independent Auditors Report 51 Consolidated Statement of Comprehensive Income 52 Consolidated Statement of Financial Position 53 Company Statement of Financial Position 54 to 55 Consolidated Statement of Changes in Equity 56 to 57 Company Statement of Changes in Equity 58 Consolidated Statement

6、 of Cash Flows 59 Company Statement of Cash Flows 60 Consolidated Net Debt Reconciliation 60 Company Net Debt Reconciliation 61 to 82 Notes to the Financial Statements IBC Company Information Cont ent s 02 x I nf r aSt r at a Pl c Annual Report and Financial Statements 2020Our Busi ness ModelI nf r

7、aSt r at a Pl c Annual Report and Financial Statements 2020 x 03COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORTI am delighted to be writing my first report as Chairman of InfraStrata plc(the Company),following my appointment on 1st February 2020

8、.It has been a privilege to chair the Company during this challenging period and to see it continue to prosper,despite the impact of the Covid-19 pandemic.This is testament to the hard work and dedication of the entire executive team,ably led by our CEO,John Wood.Following the stabilisation of the I

9、slandmagee gas storage project and the acquisition of the Harland&Wolff shipyard in 2019,the Board has turned its attention to growth and continued its strategy of developing multiple strategic infrastructure projects,enhancing revenue opportunities and carefully managing cash balances as we monetis

10、e those projects.2020 was a notable year for the Company,with the end of the consultation period on the application for a marine licence for the brine discharge from the Islandmagee gas storage facility(the IM project),the commencement of operations at the Harland&Wolff(Belfast)shipyard(H&W),partner

11、ship negotiations on the Floating Storage and Regasification project at Barrow-in-Furness(the FSRU project),the raising of 9m of additional equity on the AIM market in July and,just after the end of this financial year,the acquisition of the land and assets at the Appledore Shipyard in Devon.Finally

12、,we were delighted to secure a further raise of c7.40m,announced at the end of December 2020,which was supported strongly by existing and new shareholders.I slandmagee Gas St or age Pr oject The 42-day consultation process on the IM marine licence application concluded in March this year and we now

13、await the decision of the Department of Agriculture,Environment and Rural Affairs(DAERA).The Company firmly believes that it has now completed all formalities regarding the marine licence application and that no further work should be required.The matter is now in the hands of DAERA and we continue

14、to cooperate closely with the Department and offer any further assistance that they might require.There is no doubt that the Covid-19 pandemic has disrupted the work of Government departments and there is no certainty on how long this disruption may continue.However,we will continue to work hard to

15、remove this last impediment to a final investment decision.Latest discussions with DAERA as announced to the market indicates a determination on the Marine Licence will be made by the end of Q1 2021 and we will work with DAERA to ensure that this timeline is Chai r mans Repor t f or t he Year Ended

16、31 July 202004xI nf r aSt r at a PlcAnnual Report and Financial Statements 2020I nf r aSt r at a PlcAnnual Report and Financial Statements 2020 x05COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORTmet.We are delighted that our offtake partnership w

17、ith Vitol remains in place and indeed,that bipartite discussions are continuing with other interested parties.The Company remains confident that,once the marine licence has been secured,we will move very rapidly to a final investment decision and the next stage of this exciting project.Har land&Wolf

18、 f (Belf ast)Following the completion of the acquisition of H&W(Belfast)on 5th December 2019,the yard was reactivated and a carefully planned capital expenditure programme was put in place to ensure that the yard could very quickly accept vessels for repair and refurbishment,such that the Companys o

19、bjective of achieving a cash break-even position could be realised within a calendar year.A new leadership team has been recruited and has been focussed on rebuilding the capability of the yard across multiple sectors and offerings,whilst carefully managing the reactivation of facilities as work is

20、won.Spanning five key markets;cruise and ferry,defence,commercial fabrication,oil&gas and renewables,H&W operates six core services;technical services,fabrication&construction,repairs&maintenance,in-service support,conversions and decommissioning.We are delighted to have established a strong reputat

21、ion with blue-chip clients such as Stena,P&O,Irish Ferries etc.,and we are confident that we will continue to build our customer base,despite the slowdown being experienced in some sectors of the shipping market due to the impact of the pandemic.H&W(Belfast)is also focussed on bidding for major defe

22、nce programmes alongside establishing a Teaming Agreement with Navantia for the UK MoD Fleet Solid Support Warships requirement-a proposed fleet of three supply ships for the Royal Fleet Auxiliary.As further announcements are made by the Ministry of Defence over the course of 2021,we shall be keepin

23、g the market informed.Due to the Covid-19 pandemic,trading conditions at H&W(Belfast)have remained tough for the first half of the new financial year and achieving our target of cash break-even for the next full year period,would,I believe,be an excellent result following the first year of operation

24、s at H&W(Belfast).Har land&Wolf f (Appledor e)The Company has demonstrated its ability to capitalise on opportunities quickly as they arise and this was demonstrated again in August through the acquisition of the land and assets at the Appledore shipyard in Devon,for a total consideration of 7m.We w

25、ere delighted to receive the Prime Minister,Rt.Hon.Boris Johnson MP,at the yard on the day of the announcement and to hear,first-hand,his commitment to supporting the National Shipbuilding Strategy for the UK.The Company believes that there is a compelling case for the acquisition of the Appledore y

26、ard,to operate in tandem with H&W(Belfast)under the latters corporate identity.H&W(Belfast)s core competence lies in vessels that require a dock length in excess of 300 metres.With two dry docks at 356 metres and 556 metres in length respectively,H&W(Belfast)has the largest drydock capability in the

27、 UK and the second largest in Europe which,therefore,puts it in a prominent position in relation to larger vessels.H&W(Appledore),on the other hand,will focus on the smaller vessel in the market,requiring a dock length of 119 metres.There are very few shipyards in the UK that can offer this type of

28、undercover building dock and repair facility and,given the number of sovereign vessels required in this category over the next ten years,the Company believes that this is a market segment that cannot be ignored.H&W(Appledore)will operate across the five markets and six core services targeted by H&W(

29、Belfast)and the Company is confident that together,the two yards can access a significant short,medium,and long-term market opportunity.It is important to note that we do not envisage meaningful expenditure at H&W(Appledore)until work is secured-a strategy that we have deployed successively at H&W(B

30、elfast).06xI nf r aSt r at a PlcAnnual Report and Financial Statements 2020Chai r mans Repor t f or t he Year Ended 31 July 2020(cont i nued)FSRU Pr oject The Company continues to negotiate the required agreements with potential partners to put in place the FSRU project in Morecambe Bay,Barrow-in-Fu

31、rness.Technical and commercial due diligence has been completed and we continue to see significant interest from globally recognised Liquefied Natural Gas(LNG)companies,across the spectrum of the LNG supply chain.We have not yet formed the optimum partnerships and it is important that we do not comm

32、it funding to this project until a clear route forward is mapped out.We remain on the bench and are viewed as the partner of choice for the project.When we consider conditions to be right,we will be in a strong position to move forward to the Front End Engineering and Design phase of the project.We

33、continue to be confident that,at that time,we will have access to the required funding for further investment in this potentially lucrative project.Fut ur e Pr oject s With the continuing focus on cleaner energy and carbon emissions,we believe that natural gas will become the feedstock for power gen

34、eration and will overhaul coal and fuel oil consumption at power stations as alternative energy sources come on-line.Equally,given current government policy and the impetus being provided to kickstart what is termed as the“Green Industrial Revolution”,we must focus our attention on exciting renewabl

35、e energy projects and new technologies.We will continue to remain aligned with government policy.More importantly,definitive market soundings and routes to funding will determine which energy infrastructure projects we prioritise and monetise.I nvest or Backi ng Given our continued success in identi

36、fying exciting infrastructure projects and positioning the Company for further investment and growth,the Board decided in March of this year that further equity would be required to fund the Companys ambitious programme throughout the next financial year.I am delighted that in July the Company was a

37、ble to announce that it had raised an additional 9m of equity through a placing on the Alternative Investment Market in London and that,in addition to existing retail and institutional investors increasing their shareholdings,we attracted new institutions into the share register.A further 7.4m was a

38、nnounced to be raised by the Company in December.The overarching rationale for the placings was to strengthen the Companys balance sheet and provide management with the growth capital needed to buy new assets and to win key contracts that will underpin the growth of the Company and enable it to maxi

39、mise its potential.On any measure,the placings were a great success and I warmly welcome our new shareholders and thank existing shareholders for your continued support.The I nf r aSt r at a T eam As the Companys operations expand and its revenues grow,we continue to recruit talented people at an op

40、erational and corporate level.Our current focus is on HR,Finance and Project Management support and I have been delighted to welcome several new additions to the team in the last few months.However,it is important to note that we continue to be fully aware of the need to balance increased overhead c

41、osts with additional revenue,and only increase our cost base at a level that is sustainable.At Board level,we continue to strengthen governance and the Non-Executives are encouraged to constructively challenge the Executive team on major decisions.Given this increased Board workload,and following th

42、e acquisition of Appledore,it was with regret that I accepted the resignation of Deborah Saw as a Non-Executive Director,for personal reasons.The Board is actively working to replace Deborah but would like to place on record its thanks for her help and counsel in the months that she served.Finally,I

43、 thank those who have been supportive of the Company this year and in the past,our team,our shareholders,our customers,our suppliers and partners.The Company is confident that,with your continued support,we will continue to prosper.Mr C R Ri char dson Di r ect or St rat egi c Report I nf raSt rat a

44、PlcAnnual Report and Financial Statements 2020 x07Chi ef Execut i ve Of f i cers St rat egi c Report 08xI nf raSt rat a PlcAnnual Report and Financial Statements 2020I nf raSt rat a PlcAnnual Report and Financial Statements 2020 x09COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPO

45、RTSTRATEGIC REPORTCHAIRMANS REPORTOvervi ew We entered 2020 with excitement for the year ahead having just accepted the keys to the iconic Harland&Wolff facility in Belfast.However,none of us could have expected the tsunami of disruption that we encountered this year across our entire business as a

46、result of COVID-19.Whilst it has been tough,I am extremely proud of the way our team has dealt with the various challenges thrown at them,some of which were very unexpected,for example,when the initial lockdown was announced we saw the cancellation of numerous dry dockings(some contracted for and ot

47、hers close to contract execution)totalling tens of millions of pounds within a single week.Many companies took the easier path of furloughing employees and riding out the storm.We,on the other hand,made the strategic decision to carry on and utilise the downtime to our advantage by bringing forward

48、planned maintenance work which would inevitably enable us to capitalise on the resurgence in activity that we expect to see in the maritime industry towards the end of the current COVID environment.At every stage,the health and safety of all our employees and that of the environment has been at the

49、forefront of every discussion and decision.I am pleased to report that with the various measures put in place from social distancing to regular sanitising,our facilities have remained open for business throughout this tumultuous period.I wish to place my heartfelt thanks to the entire management tea

50、m and the workforce for their commitment to keeping our yard open for business.I set out some clear objectives to further realise our Group strategy in 2020:Islandmagee,Northern Ireland 1.Deli veri ng t he Fi nal I nvest ment Deci si on(“FI D”)f or our I slandmagee Gas St orage Project Given the amo

51、unt of interest in the award of our Marine Construction License,it is now more likely than ever that Final Investment Decision(FID)on the Islandmagee Gas Storage Project will be taken after the license has been awarded.We remain of the firm opinion that there is no reason why the marine license will

52、 not be granted,given that we are dealing with proven technology,meeting and,in some cases,exceeding environmental regulations,and have a legal opinion on the consultation process.This project is effectively a transition project that will help facilitate the UK governments clean energy 2050 targets.

53、It is quite clear that natural gas will be consumed for many years to come as we have only just started the real transition away from coal.We expect that natural gas will be the transitional fuel of choice as we progress towards a greener future with renewables and hydrogen.We remain sure that salt

54、caverns are critical not only to facilitate the transition but also to provide baseload security of energy supply when the wind does not blow,irradiation for solar power generation is inadequate or physical gas molecules cannot flow through existing pipeline infrastructure because of geopolitical an

55、d/or commercial impediments.As an island nation that is on the brink of a new era outside the European Union and with imported natural gas as the predominant energy provider,we believe that InfraStrata will have a large part to play in ensuring the security of energy supplies in the UK,especially on

56、 the island of Ireland.Whilst some progress has been made in relation to hydrogen and adapting everyday products to use it the key will be mass production,monetisation and storage of hydrogen as well as the ability to blend it back into the network.Subject to further consents,our facilities at Islan

57、dmagee will be strategically well placed to capitalise on this transition in the future.Having held meetings with Northern Irelands First Minister and Minister for the Economy in the devolved government and the Secretary of State for Northern Ireland,we firmly believe that there has been,eventually,

58、a realisation that this project is critical,not only for the security of energy supply but also for providing primary,secondary and tertiary employment in a desperately needed post-COVID economic recovery.2.Fully I nt egrat i ng t he Harland&Wolf f Brand i nt o I nf raSt rat a Plc We have now fully

59、integrated Harland&Wolff into the InfraStrata group.As part of that process,we are now running on an integrated enterprise-wide business management system(ERP system).Whilst system integration and change management projects are complex,undertaking a substantial portion of this work whilst in lockdow

60、n has demonstrated what can be achieved by teams collaborating remotely.Our business systems are now set up for further expansion of the Group and will capitalise on operational synergies where available.3.Achi evi ng cash breakeven f or t he f i rst t welve mont hs of operat i ons I believe in sett

61、ing tough but achievable goals.Whilst we have not met our cash breakeven target for the entire Harland&Wolff group,we achieved an important milestone by reaching our first month of cash breakeven on our drydock operations in October last year.Whilst not in our original plan,we had to make some key d

62、ecisions at the start of lockdown in March 2020 that made our breakeven goal much harder to achieve.With the second national lockdown now upon us,there has not,unfortunately,yet been the massive upsurge in re-certification work that we expected to see at the end of 2020.During the first national loc

63、kdown in March 2020,we made the decision to take our Belfast dock out of operation and undertake a fifteen-year cycle maintenance project along with upgrade works.This dock is one of our key assets due to its depth and access arrangements allowing it to handle some of the largest vessels.With the up

64、coming tender for the Queen Elizabeth aircraft carriers,we wanted to ensure that our facilities,being one of only two across the UK capable of handling these carriers,was ready for this tender.Additionally,by undertaking these upgrade works now,we have ensured that the facility would not be out of s

65、ervice when the anticipated high revenue projects flow into the yard once the current COVID-19 uncertainty passes.During the various lockdowns throughout the year,we have seen a greater number of emergency and routine dry dockings rather than conversion and upgrade works.Whilst the former provides a

66、 certain amount of baseload work,the latter set of contracts provide for larger revenue and cashflows as well as higher margins.We are humbled by the amount of support that we have received from ship owners and operators globally.The overall outlook for the Belfast yard in the medium to long term is

67、 extremely positive and we have several large projects that are currently at tender stage.We expect to execute sales contracts in 2021 that have longer project lifecycles when compared to what we have today.This means that we expect to achieve cash breakeven across the business during the current ca

68、lendar year and across two financial years.There is no doubt that COVID-19 has slowed our efforts down,reduced our efficiency and added costs to the business.We are several months behind where we would have liked to be at this stage in our lifecycle.However,this is not unexpected given that we opera

69、te in an environment that bears little resemblance to when we accepted the keys to the Belfast facility in December 2019.Having said that,from all accounts,the short to mid-term outlook for the shipyard across cruise&ferry,renewables and defence is looking very strong and,in fact,far better than wha

70、t we had estimated.Despite lower revenues than we expected,we are pleased that we are taking all the right steps to achieve our margin target whilst operating the shipyard in a less than optimal manner.We achieved an overall margin of slightly over 20%by the year end and we expect this to grow to th

71、e c25%levels in the future.4.React i vat i ng Harland&Wolf f Belf ast vi a a phased approach When the acquisition of Harland&Wolff(Belfast)was completed on the 5th of December 2019 it was our aim to get the Belfast dock(335m)up and running immediately.This reactivation work was undertaken in short o

72、rder as we welcomed a Seatruck ferry on the 23rd of December as our first project,eighteen days after the acquisition.Numerous vessels have passed through the Belfast dock over the months that have followed.With the onset of the COVID-19 pandemic,we made the decision to step up and accelerate our ef

73、forts to reactivate our larger building dock(556m)in order to enable the Belfast dock to be taken out of service for a four-month period and to undertake a fifteen-year upgrade on its dock gate.The required works were undertaken to reactivate the building dock successfully and due credit to our team

74、 who undertook these works in an expedited manner to allow us to take advantage of a downturn in activity.All works have now been completed on the Belfast dock gate and that dock is now fully back in service such that we now have a fully functioning two dock operation.This puts us in an ideal positi

75、on as we expect a major resurgence of high value docking and recertification works in 2021 as we start to see COVID-19 disruption end and business activities recover.We expect to see a sizeable amount of business in the yards as we deal with the enormous backlog of dry dockings that have been deferr

76、ed by shipowners globally but now need to be conducted in order to start sailing again.Our last area of reactivation is the fabrication side of the business.Whilst a lot of work has been ongoing for internal projects,we hope to secure our first fabrication project in early 2021.Key to securing fabri

77、cation works is to have the right equipment in order to ensure efficiency.We have,therefore,ordered a robotic welding panel line which will reduce fabrication costs and increase volume flow through the facility.Dock Gate Removal at Harland&Wolff(Belfast)5.Developi ng t he Harland&Wolf f Brand We hav

78、e progressed well introducing our new brand and commercial offering to the market.When commencing trading from zero,there is a fine balance that needs to be struck between increasing overheads to generate sales and overburdening the business before it gets enough revenue-led traction.We have been ve

79、ry careful to strike this balance and have,therefore,brought in a small number of more experienced leaders who can cover multiple disciplines.Acquisition Day:The Rt Hon Boris Johnson MP Prime Minister and John Wood,CEO at Harland&Wolff(Appledore)We have been actively engaged across all of our five c

80、ore markets and six sectors.As one would expect,some markets have a longer gestation period than others,but we are,nevertheless,pleased to have secured orders onboard vessels in the following markets:commercial,cruise&ferry and oil&gas which,given our relative state of infancy,is a significant achie

81、vement.As with our initial market focus,we have chosen to initially focus on some of our six sectors too.Clearly,repairs and maintenance have been our early“low hanging fruit”.We believe that we are extremely close to securing our first fabrication project into the yard and given the Prime Ministers

82、 recent announcements,we consider ourselves to be well placed to capitalise on the increased focus on renewable projects with our partner Navantia who is a world leader in this area and have already delivered several large fixed and floating wind structures over the last few years.We have only scrat

83、ched the surface in relation to sectors that we can build on as we move forward,and there are substantial opportunities that lie ahead.Key to our brand development is organic growth whilst taking advantage of any opportunistic acquisitions that are a complementary fit to our strategy.Post the financ

84、ial year end,we announced the acquisition of the Appledore shipyard which we are delighted to have brought into the Group.We believe that the Appledore facilities are an ideal fit,and they complement our two existing drydocks;We now have two of the largest drydocks in the UK(Belfast)and the largest

85、small fully undercover drydock(Appledore).Strategically it is imperative to have facilities that carry a proportionate level of overhead for the type of work being undertaken.The Appledore facility is ideal for smaller vessels up to 120m given that the cost of accommodating these types of smaller ve

86、ssels in Belfast would be disproportionate to the value of contracts for such vessels.The Appledore facility was traditionally only used for new build work.We have now established that there is a substantial number of sovereign vessels due for replacement over the coming years that would be an ideal

87、 fit for Appledore.In addition,we intend to ensure that the facility,where required can undertake docking works.10 xI nf raSt rat a PlcAnnual Report and Financial Statements 2020Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)Just like Belfast,this facility will cater to all our key

88、markets and sectors apart from cruise and large ferries.It was the highlight of our year to have the Prime Minister in attendance when the deal to acquire Appledore completed and to hear his passionate comments and underlying commitment to revitalise UK shipbuilding and restart vessel exports as wel

89、l as marine related projects generated from the UK.Reactivation:Steelworks at Harland&Wolff(Appledore)We are progressing well with our objectives for this year despite the global pandemic and the chaos that COVID-19 has caused.During the year we have had to think on our feet and act fast.Being nimbl

90、e across the business is one of our biggest strengths that we will continue to use this to our advantage.All aspects of our business have remained open and operational throughout the restrictions and shutdowns.Our shipyard in Belfast played a vital role during the first national lockdown,helping ens

91、ure that sea freight remained operational across the Irish Sea.In order to facilitate continued operations,we have introduced new processes and procedures not only for our own staff but also for our clients and suppliers.It is not until it is gone that we truly appreciate the high level of close hum

92、an contact that we have all become accustomed to in our work and social lives.We can never become complacent,and we will continue to review and bring in additional measures as we feel are appropriate and proportional to ensure continued operations and strive to make as much progress as we can in the

93、 circumstances we find ourselves in.The effects that we have felt and continue to feel given the unstable nature of this virus make it very hard fully forecast our expected performance for the next financial year.We are confident that we will pass our cash breakeven point for the Belfast facility in

94、 the current calendar year(2021).When market conditions settle and volatility reduces,we will endeavour to provide updates and guidance where appropriate.During 2020 we have managed to complete three out of our five objectives and strive to get the others completed as soon as possible.We believe tha

95、t we are starting to create real and demonstratable shareholder value and we will continue to build on the foundations that we have put in place through 2021 and beyond.It is inevitable,in my opinion,that we will see significant shipbuilding back in our facilities due to the lack of capacity at othe

96、r yards and the number of replacement vessels on the horizon over the next decade.This is even before we consider renewables,new power station construction requirements for structural steel and major conversion works on vessels.In summary,large scale and substantial volumes of steel fabrication work

97、 will lead our transformational change and we are confident of securing that this year.Having already welcomed over 20 ships through the Belfast facility during 2020,we are seeing momentum building.We hope that with the introduction of the new vaccines to tackle COVID-19,this momentum will be sustai

98、ned and that we can hit our sales target for the calendar year 2021.Key to our development is our strategy for our shipyard and fabrication facilities,not just focussing on one market but five along with operations occurring in six sectors within each of these markets.This gives us substantial oppor

99、tunities with a skilled workforce that is common across all markets and sectors.By controlling risk and not specialising in one sector alone,it affords us the opportunity to keep generating revenues should either any markets and/or any sectors experience a downturn.Within the markets in which we ope

100、rate,there will always be cyclical peaks and troughs.Our strategy is specifically designed to control that risk and provide for long term stability of cashflows.Clap for Carers:Harland&Wolff Staff Give Thanks During National Lockdown I slandmagee Gas St orage Project Whilst much mention has been mad

101、e of our newer assets,perhaps due to their ability to fund,in part,the Groups ongoing operations in the short to medium term whilst adding significant long-term value,we remain committed to delivering on our initial Islandmagee gas storage project.We continue to believe that this project has the pot

102、ential to add significant value to the Company in the medium to long term.When I joined the Company in 2018,several key components of the project,on the face of it,had been completed.However,as the new team delved into greater detail,under the surface,a substantial portion of work remained to be und

103、ertaken.We have worked tirelessly over the last two years to ensure that we are ready to proceed to the construction stage.To this end,we were proud to welcome Mark Jessop as our Projects Director this year.Mark brings with him decades of experience within the gas storage and renewables sectors not

104、only in operations but also in the construction of such facilities.Much time has been spent working in consultation with DAERA to get the Marine License issued but despite our best efforts,we have had significant delays which have been exacerbated by COVID-19 and the department effectively being shu

105、t down throughout 2020.We carried out the first formal consultation back in December 2019,having it pre-approved by the department.In order to be thorough,we agreed to a second(additional)consultation to cover a small error in DAERAs process in relation to an advertisement(which had been pre-approve

106、d by the department in advance).That second consultation was duly completed in March 2020.We currently await the outcome of the recommendation to be made by DAERA to the Minister for Environment.In addition,we have sought a legal opinion and shared this with DAERA in order to try and expedite the pr

107、ocess,particularly around the other licenses within the family i.e.,the Abstraction and Discharge Licences.For the avoidance of doubt,the Company is currently in possession of a valid Extraction and Discharge license and it is their review,due to the passage of time that has been brought into questi

108、on.I am pleased to report that after months of discussion,we agreed with DAERA that a consultation period would commence in December 2020 and formally complete on 13 January 2021,which marks the end of all such consultations.We have further been advised by DAERA of their intention to make a formal r

109、ecommendation to the Minister for Environment on or before COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORTI nf raSt rat a PlcAnnual Report and Financial Statements 2020 x1 1the end of the first quarter of 2021.The fact that we now have a formal

110、date on which such recommendation will be made is vitally important for our Final Investment Decision(FID)and we can now look at planning for the next stage of the project with a higher degree of certainty.East Antrim Coast With the end of the transition period and our departure from the European Un

111、ion on 31st December 2020,we believe that it is clearer now more than ever that the island of Ireland needs a storage project to protect it from price and supply volatility that will inevitably follow.As we move away from coal as a fuel source it is our view that natural gas will act as the transiti

112、onal fuel of choice whilst moving towards a green energy mix.This will not be a quick process and it is likely to take a couple of decades(if not many)to occur.Gas storage is in a unique position in that it will likely be the cornerstone to any meaningful hydrogen development.Currently,numerous end

113、user technologies are being developed;however,the key will be access to mass and large-scale production and storage.It is likely that at some point(subject to further approvals)that the caverns will transition over to hydrogen storage in the future.There are a lot of unknowns at this point including

114、 the pace of technological and commercial development but when there is a shift from gas to hydrogen at some point in the future,we believe that the caverns will be able to solve at least one aspect of the hydrogen commercialisation conundrum.As was recently confirmed in an independent report publis

115、hed by Oxford Analytics,by 2035,74%of all gas will be imported,which is a substantial increase from todays 48%.This will inevitably cause operational flexibility issues and make the country susceptible to shock events like the“Beast from the East”in 2018.With the storage caverns also being suitable

116、for hydrogen(subject to approval),we believe that the facility is,by far the most appropriate technology to meet the UKs growing flexibility requirements.Oxford Analytics commented further on the key economic benefits of the Islandmagee gas storage project:-Employment l400 direct jobs during constru

117、ction as well as between 800 and 1200 indirect jobs l60 direct jobs during operation as well as 120 and180 indirect jobs Wi der Economy i n Nort hern I reland lDuring construction,every 1m of capital expenditure will result in a further 2m being created in the economy.Even if 25%of the work required

118、 is not sourced locally the wider economy could still benefit by around 400m with a further 13m flowing into the local economy as a result of employment.Our view remains that this project is a critical requirement for grid stability given the intermittency of the growing renewables portfolio within

119、the broader energy mix.Given that this is strategic energy infrastructure,we believe that there may be opportunities to retain 100%ownership of this project.As it stands today,we are in a holding pattern until the marine license award has been confirmed.We remain fully committed to getting this proj

120、ect underway and expect to commence construction with some pre enabling work in early in 2021,preparations for which are already underway.This will facilitate a sharper ramp up when we take the Final Investment Decision(FID)which we expect will be in H1 2021.The key to unlocking the next phase of th

121、is project is,clearly,the grant of the Marine Licence.When I joined the business in 2018,we were a company with just one project and facing several challenges.We are a totally different business today,with the building blocks now in place to build into a large and profitable corporate organisation.K

122、ey to sustainable growth is to ensure that the overall strategy is aligned with government policy and closely following global trends.Whilst we have spent many months considering the right strategic projects to develop,we have had to consider and rank all potential projects according to where we bel

123、ieve the industry in which they operate will be in the future.Whilst we still have a huge belief in the LNG import market and the ability to create additional shareholder value in that sector,we believe that there are other sectors which will create far greater opportunities at this time,viz.,fixed

124、and floating wind,hydrogen,tidal,battery and strategic energy infrastructure projects.In light of the changing energy infrastructure environment,we will continue to pursue the FSRU project but only in partnership with existing infrastructure,should we be able to close a commercial deal with partners

125、 who own such infrastructure in Barrow.As a greenfield standalone project,the project does not lend itself to robust economics any longer.Discussions are currently underway,and we hope to make further announcements about the FSRU project through the course of the year.The Belfast acquisition provide

126、d the Company with the opportunity to substantially reduce the overall CAPEX of our Islandmagee gas storage project in addition to being cash generating and self-sufficient,potentially negating the need to constantly return to the market on a regular basis in order to provide cash inflow for ongoing

127、 operations.The addition of Appledore has substantially reduced the risk of operation of the Belfast facility and has provided the ability to share work in order to deliver larger projects in shorter time frames.With several centralised functions operating from Belfast,there are substantial synergie

128、s achievable by running the yards together under the iconic Harland&Wolff brand.Islandmagee Energy Hub Ltd continues to be the holding company for projects or concepts that are in the incubation stage.We are looking at several projects currently in the new technology space including hydrogen.These n

129、ew technologies may bring with them some grant funding to help us trial some of these concepts and undertake engineering design works.Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)12xI nf raSt rat a PlcAnnual Report and Financial Statements 2020The Current BoardCOMPANY INFORMATIONF

130、INANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORT020406080100120140160180Employees PlcEmployees IMELEmployees H&WRevenue StreamsPoten?al addi?onalPojectsCash Genra?ngProjectsKey Company Statistics202020192018I nf raSt rat a PlcAnnual Report and Financial Statements 2

131、020 x13We have introduced a new approach to Safety,Health and Environment(SHE)which was rolled out during 2020.Safety is of utmost importance in our minds and we will ensure no harm comes to any of our employees or to our environment.Board The board has very clear ambition and a strategy for growth,

132、works well together and has very complementary skill sets.The board has remained stable throughout 2020 with the only change being the departure of Deborah Saw who was unable to meet the increase in time requirements given her prior and future commitments.I would like to place on record my thanks to

133、 Deborah for the work that she has undertaken for the Company and wish her well for the future.As we progress it is essential that we have the right composition and balance on the board.The Chairman and the rest of the Non-Executives have provided tremendous support to both me and the rest of the ex

134、ecutive team during 2020.St rat egi c Vi si on During Q3 each year we carry out a detailed review of the overall business strategy which then leads into the formation of budgets and plans for the individual businesses.This year we went a stage further,reversed back and considered our original strate

135、gy as our starting point.Whilst COVID-19 has made this job so much harder,we have undertaken a full review commencing with assessing where we are today against the initial strategy presented to shareholders back on the 5th of December 2018.As I have mentioned several times,on my appointment,it was c

136、lear that a one project company was very high risk and unsustainable in the long term.The vision we developed was to be a leading,global infrastructure development&asset management company,being intimately involved through the entire lifecycle of projects from conception to decommissioning.In some p

137、rojects,we will participate from end to end of their respective lifecycles,whilst in other cases,we may choose to either only develop or acquire to operate them.One of the distinguishing features in all types of projects that we are currently involved in or wish to be involved in is that they have s

138、ubstantial heavy engineering and fabrication requirements.In order to control the lifecycle process more fully and retain a higher percentage of the development costs within the Group,it was decided to acquire a facility in December 2019 in order to give us that long run capability.The added advanta

139、ge of acquiring Harland&Wolff(Belfast)was that it also gave us the ability to have a standalone business,in its own right,that has significant growth Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)14xI nf raSt rat a PlcAnnual Report and Financial Statements 2020potential to be cash

140、positive in a relatively short period as well as being vertically integrated into our larger development projects.Our goal is to spread the Companys risk profile over several projects/operations or businesses.Whilst,initially,we restricted ourselves to a single geographical location in Northern Irel

141、and we have now branched out into Devon.Additionally,we have global aspirations for the longer term.The key update in our strategy from last year is a more concentrated approach to asset management,operations and maintenance thereby ensuring vertical integration as well as a clear focus on heavy eng

142、ineering and fabrication.The model,whilst relatively simple,will allow us to continue to enhance our balance sheet year on year.Income will be generated from four main areas of operations;each new project or company may be different and have specific nuances that need to be critically assessed.There

143、fore,individual technical and commercial models will be developed to ensure that maximum value is derived from every potential project or operating company.The four areas of expertise that we hold and that will continue to lead to income generation and incremental shareholder value are:mFront End Pr

144、oject Development to FID(Final Investment Decision)Carried equity interest mConstruction Management&Project Delivery Income generation mAsset Operation,Management and Optimisation Income generation mRetained equity in development projects-Income generation While carving out our future strategy,it is

145、 essential that the macroeconomic and political policy environment is considered in order to ensure that the Companys future strategy is in keeping with the fast pace of changing government policy in order to ensure as close an alignment as possible.We have focused on two key areas:national energy p

146、olicy including renewable energy policy and the National Shipbuilding Strategy.Both areas of policy are interlinked and fall into Harland&Wolffs core business.On the energy side,in order to meet our 2050 climate change ambitions,the Prime Minister has set out his vision to have every home powered by

147、 wind derived power by 2030 in addition to fast-tracking the transition from natural gas into hydrogen.The government is also keen to develop nuclear power in order to provide baseload support to the power grid.As a company,we are uniquely placed to deliver on this governments ambitious strategies.O

148、n the one hand,we have two shipyards in the UK that can deliver on the National Shipbuilding Strategy.On the other hand,the multi-purpose nature of these facilities means that they are capable to carry out heavy engineering and fabrication of several hundred fixed and floating wind structures that w

149、ill be needed over the course of the next decade.Maritime,heavy engineering and fabrication capabilities are inextricably linked to each other.Our business is,therefore,ideally positioned to help meet the challenges of successfully delivering on the National Shipbuilding Strategy,the governments cli

150、mate change targets and,on the energy infrastructure side,the ability to store large volumes of hydrogen to transition into clean fuels for heating and power generation.Over the past year,we have had many meetings with cross-party politicians in the UK Government,Northern Irish and Scottish devolved

151、 governments along with a number of international governments.In order to fully realise our strategy,we must be fully engaged with all political leaders across the spectrum.We believe that our current strategy is aligned with government policy and that we have the assets and infrastructure to capita

152、lise on the conditions that will arise in the market in 2021 and beyond.As we look to the future,we must keep ourselves flexible in order to respond to any change in Government policy,especially its Net Zero ambitions by 2050.Whilst these targets are challenging the focus is on getting as close to t

153、hem as possible.By way of an example,the Prime Minister announced that wind farms could power every home by 2030 with an increased target from 30 gigawatts to 40 gigawatts.The government is,therefore,targeting to achieve this goal in less than 10 years time.InfraStrata owns one of the few UK facilit

154、ies in the UK capable of undertaking this type of work and was previously involved in fabrication activities for East Anglia 1 which was a pioneering development in the UK and estimated to cost 2.5bn when it was commenced in 2016.In order to meet these ambitious targets,approval is likely to be fast

155、 tracked for numerous projects that are currently in the pipeline.Additionally,fabrication capabilities will need to be expanded rapidly including all existing and new facilities to swing into 24/7 operations in order to deliver on these upcoming huge projects.The recent government announcement on s

156、hipbuilding is not a new one.The UK government has,for many years,been trying to identify why other developed economies with equally high labour costs are able to develop booming defence&commercial shipbuilding sectors with high export elements.Sir John Parker was commissioned in 2017 to develop a N

157、ational Shipbuilding Strategy(NSBS),the clear focus of which has been on defence.Only in recent times and with the departure from the European Union has the government doubled down on efforts to widen the NSBS to cover commercial shipbuilding opportunities.As is common knowledge,there have been many

158、 failures in the shipbuilding sector globally.We believe that this is primarily due to shipyards maintaining a very narrow focus on only one,possibly two markets.In contrast,our strategy to build our shipyard and fabrication capacity has a focus on five key markets and six sectors.With each yard foc

159、using on all five markets but providing a different offering relative to the size of each contract.Whilst operating across a broad range of markets the business will be able to withstand traditional downturn periods that are cyclical across industries like Defence,Oil&Gas and Commercial.Equally,whil

160、st operating in the five key markets it is also essential to operate across multiple sectors to generate income both inside and away from the shipyard and fabrication facilities(such as through in-service support).It is critical that the assets we acquire that have real strategic importance.For exam

161、ple,Harland&Wolff(Belfast)has two of the largest drydocks in Europe and the biggest in the UK ensuring that the top end of the market is protected.Likewise,with the recent acquisition of Appledore at the smaller end of the market,we have one of the only facilities with direct access to the sea with

162、relatively deep water for its size.There is work available across all markets and sectors.However,it will take time to build relationships and confidence in these markets that we have very recently entered,although we do feel well positioned to capitalise on clear gaps that we see in the market.Whil

163、st the yards shall standalone in their own right,they will most likely form a link in our supply chain especially for our infrastructure project development in the future.By making good use of vertical integration,we can keep a proportion of the development costs of a project within the Group from w

164、hich we aim to add substantial shareholder value.Key to sustainable growth is to ensure that the overall strategy is aligned with government policy and closely following global trends.Whilst we have spent many months considering the right strategic projects to develop,we have had to consider and ran

165、k all potential projects according to where we believe the industry they operate in will be in the future.For every project that we look at we go through a robust set of criteria to ensure it is the right fit for the Company and,equally,it is essential that at each gate review we continue to make th

166、at assessment as policy and markets evolve during the lifecycle of each project.From that perspective,the challenge is to assess where markets are likely to be in 4-5 years time as opposed to where they are today.We are seeing some key trends emerging and believe that our long-term opportunities exi

167、st within fixed and floating wind,hydrogen storage,tidal,battery and other green energy infrastructure projects.We are now seeing our strategy coming together following the acquisition of the two Harland&Wolff facilities which,by themselves,will start growing organically in the months and years ahea

168、d with the ultimate ability to generate funds in order to invest in new projects.As we continue to grow,we will cluster our businesses under activity specific group structures in order to appoint fully qualified teams to run each cluster while maintaining commonality and an extensive crossover betwe

169、en the clusters.Having a group structure of this nature will allow for dilution,where necessary,at project/operational level without having to dilute at the parent company level.In addition,it will provide efficiencies to allow similar businesses in the same cluster to operate with shared management

170、 and a central function facilitating a reduction in overheads.Where any international business is undertaken within the InfraStrata group,this will be undertaken by a newly incorporated company inside that jurisdiction and will be held by a fully owned intermediate subsidiary of the ultimate parent

171、company,InfraStrata plc.COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORTI nf raSt rat a PlcAnnual Report and Financial Statements 2020 x15L-R:John Wood,The Rt Hon Boris Johnson,Prime Minister and The Rt Hon Sir Geoffrey Cox QC MPL-R:Perry Kennedy

172、,The Rt Hon Brandon Lewis MP,Secretary of State for Northern Ireland and John Wood Our VisionTo be a leading,global strategic infrastructure development&asset management companyRetained Equity%FacilityOperationsConstruction ManagementInfraStrata DevelopedProject Development(Carry)Income GenerationHi

173、ghPerformingTeamQuality PartnersOperationalExcellenceRobustPotentialProject EvaluationCriteriaSustainableGrowthShareholderValueVertically integrated heavy engineering&fabrication2021 Key Objectives 1.Obt ai n t he mari ne l i cense and t ake FI D on t he I sl andmagee gas st orage proj ect 2.Ensure

174、cash breakeven f or t he whol e of t he Harl and&Wol ff group 3.Commence f abri cat i on proj ect s i n Harl and&Wol ff and obt ai n a new vessel bui l d order or a bl ock f abri cat i on order 4.I dent i f y and est abl i sh an ent ry poi nt i nt o t he renewabl e energy i ndust ry 5.Cont i nue t o

175、 bui l d a hi gh perf ormi ng t eam t hat operat es i n a saf e and envi ronment al l y f ri endl y manner I SLANDMAGEE ENERGY LI MI TED Overvi ew Larne Lough Our flagship Islandmagee gas storage project was first established in 2010 when a layer of salt was discovered 1500m underneath Larne Lough.T

176、his salt layer is ideal for the establishment of underground gas storage caverns.The storage caverns are formed by drilling wells from the well pad into the salt layer thereafter removing the salt(in a brine solution)and discharging it into the fast-flowing Irish Sea via the leaching plant and pumpi

177、ng station.The rates and levels of discharge are highly regulated activities governed by the regulations set by the Department of Agriculture,Environment and Rural Affairs(“DAERA”).Our proposed discharge rates are well within the legal environmental limits and we have further proposed a monitoring p

178、rogram that is in excess of these legal requirements.The gas injection and withdrawal facility will be constructed on the surface and this will facilitate moving gas from the network to be injected into the caverns in times of excess supply and,conversely,withdrawn from the caverns back into the gas

179、 network when there is a shortage of gas supply.The project will have seven storage caverns and subject to approvals there may be an opportunity to develop further caverns.The current expectation work is that pre enabling work,which is not reliant on the Marine License will commence in Q1 2021 with

180、FID expected in H1 2021.Assuming the marine license is issued in Q1 2021 we expect first gas in 2024.The project has the advantage of being a transition project from natural gas to hydrogen(subject to approvals required for hydrogen storage).We have now formally departed from the European Union;howe

181、ver,we will continue to have strong domestic demand for gas and pressures on our gas delivery network during times of high stress will continue each year.However,in the absence of adequate domestic storage,we will stand exposed to the risk of physical gas not flowing from the EU into the UK during p

182、eak periods until local EU demand has been fully satiated.The events from the past(such as the Beast from the East)have demonstrated our reliance on imported gas and the volatility in price and physical supply in the absence of domestic gas storage.The UK until recently had the Rough gas storage fac

183、ility and substantial domestic production.With UK indigenous production declining,gas storage has become increasingly essential to ensure that the UK does not suffer from interruptions in power supply.The UK government has set substantial targets to tackle climate change and this project will be at

184、the heart of those targets.The facility will be able to be converted to hydrogen storage or provide the opportunity in the first instance to provide blends of hydrogen as that industry develops over the next two or three decades.A lot of work has been done in developing front end technologies for hy

185、drogen production.However,without storage solutions,those technologies will struggle to reach commercial reality.Whilst further approvals will be required at some point in the future when that transition period arrives,it is also possible that we could jumpstart this process by seeking approvals for

186、 one cavern initially with the intention to transition other caverns subsequently.Even though hydrogen from a mass production and consumption point of view is still in its early stages of development,what is abundantly clear is that hydrogen storage will be absolutely essential in the future.Chi ef

187、Execut i ve Of f i cers St rat egi c Report (cont i nued)16xI nf raSt rat a PlcAnnual Report and Financial Statements 2020?!?#$#?%?(?#$#)?*?+,?-?-?.?I nf raSt rat a PlcAnnual Report and Financial Statements 2020 x17COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPOR

188、TCHAIRMANS REPORT Gas Pipeline The development of this project will provide substantial economic benefits to the local economy.In order to fully understand these benefits,the company engaged Oxford Analytica to assess the impact of the project on the local economy.As a result of COVID-19 thousands o

189、f jobs have been lost in Northern Ireland in a reasonably close proximity to the project.The project has had independent verification that it will create 400 direct and between 800-1200 indirect jobs whilst injecting at least 7m into the local economy during the construction stage which will be a mu

190、ch-needed boost in a post COVID-19 environment.The wider economy is expected to benefit by around 400m as a result of the project,whilst 60 long term direct jobs will bring 1m into the local economy annually with around 120-180 indirect jobs creating another 2-3m benefit annually.The project is expe

191、cted to have a technical useful life in excess of 50 years.However,in order to be prudent,the financials of the project have been run over a 40-year period.Unaudited management expectations are a projected IRR of 21.6%,NPV10 141.6M,NPV8 222.6m,undiscounted cumulative revenues 3.67bn and undiscounted

192、 cumulative free cashflows of 1.68bn.As can be seen from the chart below,the caverns will be brought into commercial operation in a phased approach,but the project will nevertheless commence revenue generating prior to the full capital expenditure being realised.The model takes into consideration th

193、e CAPEX,OPEX,revenues,finance costs,tax and resulting free cash flow over the life of the project.Whilst the project is modelled over a 40-year period it is highly likely that the project will exceed that period given the continued economic life of existing caverns around the world in excess of 50 y

194、ears.The project is at an advanced stage and technically ready to proceed to construction.We are currently in the process of obtaining new tenders for the various work packages given the delay that has been caused in relation to the Marine Licence being issued.As it stands currently,the project has

195、a“draft Marine Licence”and work has been undertaken to convert it into a“full Marine Licence.The Marine Licence is required to discharge salt into the Irish sea inside the 12 nautical mile limit.As part of the Marine Licence,an abstraction and discharge licence is also required,both of which are cur

196、rently held by the company.Discharge outside the 12 nautical mile limit was an option that was considered as plan“B”given that the discharge requirements to be put in place beyond the 12 nautical mile range were less onerous.A review was undertaken during 2019 in relation to this plan“B”.However,thi

197、s has been taken no further due to all planned activities currently falling well inside the existing environmental limits.Last year we spent considerable time and effort working through revising and updating all our environmental data to ensure we had established a full baseline.We have additionally

198、 revisited all aspects of the project to ensure that it complies and,in some cases,exceeds regulatory standards.We have also established internal systems and processes that significantly exceed current regulations to prove and facilitate full transparency around the discharge of brine for this proje

199、ct.This has achieved two objectives;one,it has sought to mitigate concerns of locally formed protest groups and,two we have been open and honest with the Department Agriculture Environment and Rural Affairs(DAERA)and shared all data to ensure transparency.Despite a DAERA error with the first round o

200、f consultation that commenced in December 2019 we agreed to hold another round to avoid further delays in the future.This second round was completed in March 2020 just at the onset of COVID-19.However,after the closure of the second consultation,DAERA informed the company that they wished to consult

201、 on the existing abstraction and discharge Licences.The company strongly contested this position and instructed its legal advisors to confirm our understanding of the relevant legislation.Further,we also obtained an independent legal opinion which yet again confirmed our understanding of the legisla

202、tion.It is clear that the department is entitled to undertake a review of the existing licenses at any time during the life of the project but it has no legislative authority to conduct a consultation for a review process which ultimately leads to unnecessary delays and a waste of taxpayer funds.As

203、announced via an RNS in December 2020,we have now reached an agreement with DAERA to undertake another consultation that will formally end on 13 January 2021.For those stakeholders who have not had the opportunity to respond to the consultation either due to the holiday season or COVID-19,DAERA has

204、extended the consultation on a case-by-case basis till 20 January 2021.More importantly,we have also reached an agreement with DAERA that they will make a formal recommendation(whether to approve or reject the Marine Licence)by the end of Q1 2021.We see no reason why a recommendation for the issue o

205、f the Marine Licence will not be made given that we are fully compliant with all relevant legislation and have taken all the steps over the course of the last two years to engage with all stakeholders,update all scientific reports and provide a watertight project to DAERA.Gas St orage Agreement (GSA

206、)A significant amount of detailed commercial work was undertaken during the negotiation of the Heads of terms stage for the GSA.Implementation of these terms into the GSA has progressed well but have been temporarily put on hold so as not to waste legal costs whilst the Marine Licence remains under

207、discussion.Drafts have been exchanged between the parties.Given that the commercial model being used is pioneering and has not been devised previously,a number of back tests and independent assessments have been conducted in order to prove the effectiveness of this new commercial gas storage model.T

208、he fact that we have managed to secure an element of the traders profit into our agreement in addition to receiving 100%of the classic seasonal spread bodes well for the future.For the avoidance of doubt,the funding model that we adopt to construct the project will not affect the GSA.?18xI nf raSt r

209、at a PlcAnnual Report and Financial Statements 2020Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)Project Fundi ng We have numerous options open to us to fund the capital expenditure element of the project and all will be done at the project level rather than at the Plc level.The op

210、tion that we had prior to COVID-19 with an equity partner coming in,providing the equity and obtaining the majority shareholding whilst repaying our back costs is still active and on the table.In addition,we also have options of a foreign company investing in the project and obtaining government inw

211、ard investment finance for strategic infrastructure.Lastly,we also potentially have the ability to obtain direct government funding for constructing a strategic piece of infrastructure that will ensure the security of energy supply and act as a transition facility that will(subject to further consen

212、ts)convert to storing hydrogen at some point in the future.As soon as the Marine Licence has been resolved we intend on pursuing all three options,determining the viability of all three in parallel and completing funding discussions in order to take FID and commence construction.For the avoidance of

213、 doubt,no contractual commitments have been entered into between the Company and any set of funders as yet.This process will gather speed once the Marine Licence has been formally granted.Fut ure of St orage We believe that storage projects have a very bright future in general,the Islandmagee gas st

214、orage project in particular.Our flagship project is the only gas storage project in the entire island of Ireland and lends itself naturally to boosting the security of energy supply to the entire island.The fact that gas will be stored in salt caverns allows for high deliverability rates into and ou

215、t of the store.This operational efficiency will help balance the gas network in times of peak stress.The salt strata in which the caverns will be situated is substantial and the number of caverns can be increased subject to further planning permissions and meeting other regulatory requirements.Most

216、importantly,given the pace at which technologies for hydrogen production and carbon capture are being developed,we believe that gas storage,within the correct geological strata,can be converted into hydrogen storage and for carbon capture.Salt caverns are inherently multi-purpose and have the capabi

217、lity of being used for a wide range of commodity storage.Our gas storage project is,therefore,likely to transition from natural gas storage to hydrogen storage as soon as commercial volumes of hydrogen that at least mirror gas prices can be produced.Various grid operators in the UK and around the EU

218、 are already looking at blending hydrogen with natural gas.Blending is best done mid-stream at a storage facility.From that perspective,we believe that the transition into hydrogen storage will involve an intermediate step of blending both gases at the storage facility and injecting such a blend int

219、o the domestic gas network.The project has,therefore,been adequately future proofed to make sure that the capacity in the caverns will be utilised in one shape or another through their technical lifetime.Synergi es Bet ween I MEL and Harland&Wolf f During the FEED study it was clear that one of the

220、challenges for the Islandmagee gas storage project was the transportation of several large items of plant and equipment to the project site.Further,in the absence of any involvement of the company in the overall capital expenditure of the project,almost all the expenditure would be devoted to third

221、party suppliers.Given the restrictions relating to weight and physical size of component structures,we put a lot of detailed analysis into the transportation plan.In an effort to determine the most cost-effective transportation route,numerous locally available sites and facilities were considered.Th

222、e Harland&Wolff site in Belfast was visited in March 2019 and considered to be an optimum staging facility for the project.The advantage of being able to construct larger modules and have less assembly work on-site was calculated to offer a substantial CAPEX cost reduction for the Islandmagee gas st

223、orage project.With the relatively short coastal passage of 12 nautical miles,Harland&Wolff was the ideal acquisition from,inter alia,a geographical perspective.With potentially more modules/components now being able to be transported via barge,this will lead to significantly less traffic on the loca

224、l roads.In addition,it will facilitate a higher level of utilisation of the Northern Irish workforce.We have made a commitment at all stages of our flagship project to utilise,where possible,the local workforce.The utilisation of local labour and construction within a nearby facility like Harland&Wo

225、lff will ease the supervisory burden on the company,increase efficiency and save on costs.From an InfraStrata perspective,retention of margins on fabrication work within a group company as opposed to passing it on to a third-party fabrication company added to the attractiveness of Harland&Wolff as w

226、ell as the ability of Harland&Wolff to be self-sufficient within its own right.Harland&Wolf f A year has passed since InfraStrata took ownership of its first shipyard in Belfast when it purchased the assets of Harland&Wolff and obtained the keys to the facility on 5th December 2019.The rationale thr

227、ough the acquisition was to utilise the site to develop the Islandmagee gas storage project and to establish a standalone business which would be capable of operating across five markets and six sectors whilst enabling InfraStrata to vertically integrate high value fabrication works to keep more fun

228、ds flowing through the companys internal strategic infrastructure projects.The final payment to acquire the assets of 1.45m was paid to the administrator during July 2020.An Aerial View of Harland&Wolff(Appledore)Proximity:The Distance Between Harland&Wolff(Belfast)and the Islandmagee Gas Storage Si

229、te Harland&Wolff(Belfast)Welcomes Three Sister Viking Ships-The First Time Since the Olympic-Class Trio COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORTI nf raSt rat a PlcAnnual Report and Financial Statements 2020 x19On 24th August 2020,InfraStr

230、ata acquired another facility known as the Appledore shipyard in North Devon to complement the larger Belfast facility.After further developing a deeper understanding of the markets that are involved in and having spoken with a large number of stakeholders,particularly the government and our key cli

231、ents,it was agreed by the board that to capitalise on a significant amount of work at the smaller end of the market it required a dedicated yard to do so.The yard had previously been leased to Babcock plc on a long-term lease by Langham Industries.In 2019,the tenant decided to relinquish the lease a

232、nd focus on its operations in Scotland.The company has agreed to pay a total Consideration of 7million for the Acquisition of substantially all the assets of Appledore.The Consideration will be payable in the following tranches:lTranche 1 on Completion:A total of 1.50million consisting of cash of 1.

233、20million and 784,404 ordinary shares of 1 penny each in the capital of the Company(Ordinary Shares)equivalent to 300,000 lTranche 2 on the first anniversary of Completion of 1.50million:A total of 1.50million consisting of cash of 1.20million and Ordinary Shares in the Company equivalent to 300,000

234、 lTranche 3 on the second anniversary of Completion:A total of 2million consisting of cash of 1.60million and Ordinary Shares in the Company equivalent to 400,000 lTranche 4 on the 30th month anniversary of Completion:A total of 2million consisting of cash of 1.60million and Ordinary Shares in the C

235、ompany equivalent to 400,000 The two Harland&Wolff facilities in Belfast and Appledore respectively have had a chequered history.We believe that this was due to a particular focus being paid to one market only.For example,the Belfast yard specialised in renewable energy too early and the Appledore y

236、ard was only focussed on the defence market.The resultant situation meant long sustained periods without work when one of those industries took a downturn.The model that we are implementing is to operate across five different markets,namely,Cruise and Ferry,Oil&Gas,Commercial,Renewables and Defence.

237、Within these markets,we will be operating in sectors throughout the entire project lifecycle from technical services at the start of the lifecycle,through the fabrication of vessels,vessel blocks,civil bridges and steel for power stations and other civil infrastructure projects.The repair and mainte

238、nance of vessels is a sector and will utilise the drydocks and slipways in both yards.Vessels are required to drydock every three or five years to meet classification society rules so that will inevitably become a baseload business for us.In-service support is a market that covers supporting vessels

239、 and projects away from the yard,the benefit being we are not constrained by our own footprint.Should a project not be awarded to the yard,in-service support still provides us with the optionality to be involved in the project.More importantly,in-service support helps build client relationships for

240、future projects and provides additional routes for vertical integration.One of the larger sectors is conversion where major projects are carried out on vessels to change the use or substantially upgrade them.Finally,at the end of the lifecycle is the recycling or decommissioning of a vessel or struc

241、ture.Clearly,there is a lot that needs to come together including political engagement and support of our various communities to ensure that we have the correct talent and workforce coming through the yard gates.This includes apprentices starting out on their individual journeys.Fully engaging a glo

242、bal supply chain is essential to ensuring contracts that are tendered are done so with the minimum amount of risk and at the most competitive price.It will not always be possible to undertake projects on our own,and in recognising our limitations,we have already established a joint venture with Nava

243、ntia where we are looking at several projects together across defence,cruise and ferry and the renewables markets.We also have the opportunity of establishing technology transfers to upskill Harland&Wolff quicker than we may be able to do so on our own and with a substantially reduced risk profile,w

244、hilst endorsing the latest technology available.We have a complete sense of purpose and a clear strategy of what we are looking to achieve and how we will deliver it.The defence industry,for example,has a duopoly currently in place and we are friendly disruptors who will provide for further competit

245、ion rather than a pre-arranged split of work.When considering the number of fabrication works that will be required over the next decade over defence,renewables and commercial there are simply not enough facilities available.Our yards will be full over time taking up as much slack as possible.Within

246、 the export market,there are numerous opportunities that can be exploited as well.In the midst of all the business that we are seeing likely to come into both yards,we should remain vigilant with our risk profile in relation to every project that we take on as well as investing in technology and inn

247、ovation in order to establish a strong foothold in our various markets.Stena&Seatruck Vessels at Harland&Wolff(Belfast)Our business model must be sustainable.We are less interested in one massive contract that will fill up all the capacity and not allow us any other projects.That will be unwise.We m

248、ust stick with our strategy regardless of how tempting it is to fill the yard with work from one sector that is currently booming but equally likely to undergo a downturn in a few years time.Looking back in history,this has probably been the most mistake that shipyards have made.Keeping a balanced p

249、ortfolio is essential to dealing with the enormous peaks and troughs that naturally occur in the various markets that we are engaged in.when looking for Government support and funding programmes,having two facilities that are in close proximity to each other but in two distinct regions where levelli

250、ng up has been promised is very helpful.From an operational perspective,it helps reduce the risk profile of both yards and gives the yards the flexibility to split the work up to ensure delivery is on time whilst benefiting from a transient workforce that can operate on either site.Having the gas st

251、orage project on the doorstep of H&W in Belfast provides opportunities for initial fabrication and ongoing through life support for the project.The key to success in any business is building a competent management team that is capable of growth and can be upscaled.It is essential,with any team,that

252、they operate as one team and ride the journey together through its highs and lows.The team that we have established has an international pedigree with vast experience across all our markets and sectors.Looking at the profile of our two facilities,Belfast sits at the top of the dock size range with t

253、wo of the largest docks in Europe whilst Appledore sits at the bottom end of the market with the largest fully enclosed float-in/float-out dock in the UK.Our main competitors are situated in the crowded middle sector.With Belfasts impressive 81 acres and Appledores 29 acres,we have the perfect footp

254、rint to fabricate and load-out the majority of structures.Having the ability to load out large scale renewable projects directly from our fabrication facilities is a huge bonus in the current Green Industrial Revolution that was announced by Prime Minister Johnstone in November 2020.With the announc

255、ement that followed in relation to the biggest increase in Defence spending for thirty years,clearly,all the UKs fabrication facilities will be at capacity in order to meet the unprecedented demand of both sectors.It is essential during this boom time however to ensure that we maintain a balanced po

256、rtfolio of work in the facilities across our five key markets providing our six services.20 xI nf raSt rat a PlcAnnual Report and Financial Statements 2020Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)Future of storage COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS

257、 REPORTSTRATEGIC REPORTCHAIRMANS REPORTI nf raSt rat a PlcAnnual Report and Financial Statements 2020 x21Note:-As with all infrastructure,if any change of use is deemed viable from gas to hydrogen in the future then all regulatory authority approvals required will be applied for.22xI nf raSt rat a P

258、lcAnnual Report and Financial Statements 2020Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)One Winning Team:Harland&Wolffs Sustainable Business ModelI nf raSt rat a PlcAnnual Report and Financial Statements 2020 x23COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REP

259、ORTSTRATEGIC REPORTCHAIRMANS REPORT?/?/?35?!?7?:?;?!/?:?/?24xI nf raSt rat a PlcAnnual Report and Financial Statements 2020Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)MARKETS Def ence Harland&Wolff is a UK strategic defence asset,as one of only three UK naval shipbuilders suitabl

260、e for major MOD contract work and boasting two of the largest docks in Europe.Set on 81 acres our Belfast facility is one of only three facilities in the UK suitable for major MOD contract work.Meanwhile,our Appledore shipyard has a strong portfolio of vessels built within its facilities from landin

261、g crafts to patrol boats.Our 335m Belfast dock is one of only two docks that can currently dock the Queen Elizabeth Aircraft Carriers.With global warming and rising sea levels we will shortly be the only yard that has the water depth available to undertake these critical dockings.Our senior team has

262、 extensive experience across several high-profile global defence programs,including the Canberra Class Amphibious Assault Ship,Anti-Ship Missile Defence upgrade for the Royal Australian Navy ANZAC Class Frigates,the Canadian patrol program and UK complex warship programs.Commerci al Whilst we are ab

263、le to undertake work on numerous commercial vessels,we are also ideally positioned to fabricate bridges,structural steel,building and loading frames with the ability to handle numerous projects concurrently.High performing teams across both shipyards are dedicated to delivering success stories.Our A

264、ppledore site regularly hosts fishing and commercial vessels for repairs on its slipway whilst undertaking refits in its undercover drydock.The impressive drydocks and deep-water access at Belfast provide unrivalled accessibility.Vast storage areas and quayside space present opportunities to conduct

265、 work ahead of vessels arriving,reducing downtime for fabrication on construction and conversion projects.?#$?%?!?%?%?&?%?%?()?&*?)?#$?#?+$,?-&,?=?=?=?-,?$&?&?=?=?=?-#?$?(+?$,?./?0?1?.?1?.23%4?.?%?%?$5$5?$5$,$5$5$-?$5$&$5$+I nf raSt rat a PlcAnnual Report and Financial Statements 2020 x25COMPANY INF

266、ORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORTOi l&Gas Our advanced design engineering skills and construction facilities allow us to offer tailor-made solutions competitive with standard off the shelf products.Modules have been designed and built in acco

267、rdance with NORSOK,Lloyds,DNV,GL,ABS,BSH,NMD,and NPD regulations,including the new DNV-OS-J201 standard Our large storage areas and 2000m of quayside offer unique opportunities to manufacture and store modules and blocks.In addition,our Belfast facility enjoys access to the open sea free of any rest

268、rictions making it ideal for new Oil and Gas projects as well as for through-life upgrades of large offshore structures.Crui se&Ferry Harland&Wolff is the only shipyard in the UK capable of undertaking multiple Cruise projects concurrently.Our Belfast yard offers flexibility and capacity ensuring a

269、rapid turnaround.Our fully engaged and high performing team have a passion for quality and getting all the details right first time.Vessels entering our facilities are in the hands of some of the worlds most experienced talent who appreciate the importance of ensuring a five-star finish.Our Belfast

270、shipyard expertly handles some of the worlds largest cruise ships within its 335m and 556m drydocking facilities respectively.Set a short steam away from the Atlantic Ocean and the Irish Sea,Belfast has two international airports,offering immediate access for cruise&ferry customers.The city also has

271、 a substantial supply chain including being home to some leading interior outfitting contractors.Renewables With renewable energy set to become one of the UKs most valuable assets,we are in an enviable position with one of the worlds best facilities offering flexible fabrication and load in/out faci

272、lities with a dedicated project management team to guarantee delivery.Our large 81 acres site in Belfast has multiple high load points to ensure structures can be fabricated,tested and stored before a consolidated loadout to site.We have a 556m drydock with twin overhead cranes that can load structu

273、res from the dock onto a waiting barge.Additionally,with multiple wet and dry configurations,our facilities can be set up to provide fast and cost-effective loadouts regardless of the configuration of vessels or barges.With 30 acres in Appledore and direct access to the Bristol Channel,we can load o

274、ut from out our quayside or directly from our 120m drydock which can also be used as a fabrication facility.Harland&Wolff is actively marketing in all our key markets,some of which have a longer gestation time than others.We have chosen to pick the low hanging fruit first with cruise&ferry and comme

275、rcial as projects are immediately available and tend not to have a substantially long lead time.However,these projects tend to have smaller contract values.On the other hand,projects with higher contract values also suffer from longer lead times.A lot of the work that we are undertaking now and the

276、tenders that we are submitting currently are for projects that will commence in 12-24 months time.We are effectively investing in our future today.26xI nf raSt rat a PlcAnnual Report and Financial Statements 2020Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)SERVI CES T echni cal Se

277、rvi ces Our technical services team comprise naval architecture,system design and engineering,electrical design and engineering,steel structural design and engineering and general arrangement and outfitting.The team of professional design engineers provide a comprehensive range of services from init

278、ial consultancy,basic design,detailed engineering to through-life support,and with all services being accredited to internationally recognized standards.The deeply experienced engineering team takes a holistic approach to providing comprehensive solutions and provides engineering support from indivi

279、dual tasks to complete work packages.With a well-proven track-record in delivering success stories.Fabri cat i on and Const ruct i on Since its establishment in 1861,over 1,700 ships,offshore vessels and various steel structures of all types and sizes have begun their life in our Belfast Shipyard an

280、d over 300 in the Appledore shipyard.These include Defence vessels,bulk carriers,tankers,drill ships,ro-ros passenger vessels and FPSOs.Integrating extensive facilities with a large engineering capacity and strong project management enables us to offer a“one stop shop”with a highly focused,client ce

281、ntric approach.With direct deep-water access and 2,000m of quayside space,our Belfast shipyard sitting on 81 acres welcomes a wide variety of vessels and structures.The site boasts a vast main dock and two 140m“Goliath”gantry cranes.Within the 30,000m2 covered fabrication halls up to 250 tonnes of s

282、tructural steel can be handled per week in Belfast.Covering 29 acres our Appledore site is well positioned with direct access to the shipping lanes in Southern England and more conveniently to Belfast to enable project work and part components to be transported between the yards.With a 120m building

283、 dock and numerous fabrication and assembly areas,our Appledore facility can fabricate up to 120 tonnes of structural steel per week.?6?6?$)?&*?%?%?-,?+?#5?%?+5&?-)?+?%?%?$5?-5?%?$&?=?=?!?!?#?!?&?(?)?*)?)?)&?!?!?&?sno i n008000600040l000020l?0 020?!?!?!?#?$?%?#?&?!?giWec cDeMi0 0De?hgieWUndethgg gAu

284、Aun nJuJur rApApb bFeFec c?dethc cDeDet tOcOcI nf raSt rat a PlcAnnual Report and Financial Statements 2020 x27COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORTRepai rs&Mai nt enance We have a worldwide reputation with owners and operators for str

285、ict standards of health and safety,quality and timely delivery for planned and emergency repairs to all vessel types.This is reflected in our high numbers of repeat customers.We work with our clients to keep their assets in service and productive,whilst helping to improve their operational effective

286、ness.We take the time to understand our clients needs and ensure high quality project management for each and every project we undertake.Our engineering history has developed a superb technical skillset,specialised in the marine and offshore environment,with a team which works in partnership with ou

287、r clients engineering and logistic teams.We have some of the most extensive and best equipped shipbuilding and repair facilities in Western Europe.In Belfast a massive 556m and 335m drydock complemented by a smaller 120m dry dock in Appledore.I n Servi ce Support Boasting not one but two easily acce

288、ssible shipyards,strategically set to provide a variety of expert-led services.Whether its a remote breakdown,urgent repairs which do not require shipyard facilities or supporting a strict timetable of work,you are in safe hands with our deeply experienced team.Our crew has some of the most experien

289、ced marine and offshore workforce in the world,with varied technical skillsets and specialist knowledge.No matter how complex the challenge.our crew has the talent and determination to find an effective and efficient solution.Our agile and flexible approach,combined with our widely experienced maint

290、enance and repair team,means we can support our clients for planned in-service works off site as well as being able to mobilise at short notice in the event of an unplanned maintenance or repair requirement to ensure return to work of an asset with minimum downtime.Conversi on Our crew offer a varie

291、ty and depth of experience;working on a conversion project from simple renewals to complex overhauls,for vessels to offshore platforms and rigs.We support the entire conversion process from the initial feasibility studies and detailed design,through to fabrication and any extended lifetime support.W

292、ith the capability to work on one-off conversions to conversions of entire fleets.Our engineering history has developed a superb technical skillset,specialised in marine and offshore conversion projects.Our engineers work closely with the delivery team to ensure high quality,effective and responsive

293、 project management.Decommi ssi oni ng We have the largest dock licensed for marine waste disposal in the UK enabling us to deliver cost effective,transparent and compliance assured projects.Our docks can accommodate the largest structures and a high degree of mechanisation strip costs out of the de

294、struction process.No matter the type of vessel of offshore structure,decommissioning requires careful attention to health,safety and environmental standards.With our Belfast shipyard accommodating one of only two docks in the UK licensed for marine waste disposal,we understand this well.When DEFRA f

295、irst established a set of standards that challenged the industry to step up and offer a transparent,environmentally sound and socially responsible solution to decommission,we were the first to answer that call and obtain a Waste Management License for ship and offshore unit recycling,based on that n

296、ew standard.28xI nf raSt rat a PlcAnnual Report and Financial Statements 2020Chi ef Execut i ve Of f i cers St rat egi c Report (cont i nued)The other method of looking at our pipeline is to split it by the services that we provide.In re-establishing the Harland&Wolff facilities,we have had to be se

297、lective about which services we ramp up initially to ensure quality and guaranteed delivery.Given the ratios of our unweighted pipeline to our weighted pipeline,the clear focus has been on getting the drydocks up and running,with fabrication next to commence.In-service support and technical services

298、 are still in the planning stages with the intention to ramp them up in 2021.From our next annual report,we intend on commencing reporting on our conversion ratio from pipeline to sales as well as the backlog on our books.This is predicated upon our business stabilizing following the subsiding of th

299、e COVID-19 pandemic.As our data becomes more mature it will be easier to set guidance with some level of confidence and to ensure we deliver against our guidance.With the ongoing COVID-19 situation it makes setting guidance extremely difficult as markets tend to change on a weekly basis following ch

300、anges to government advice.We are currently seeing a massive backlog of Cruise vessels mandatory drydocking work building up as vessels remain out of service and will require substantial works before passenger certificates are reactivated as they re-enter service.With the cruise industry gearing up

301、for a restart in H1 2021 we are already seeing a substantial increase in enquiries being received.Standard ferry docking demand remains strong;however,projects remain restricted to essential work only.We expect to see contract values in future years rise as soon as cash conservation by ferry operato

302、rs due to the ongoing pandemic eases.The two recent government announcements in relation to the“Green Industrial Revolution”and defence spending bode well for Harland&Wolff as these are two of the key markets that we are involved in and one of the only yards in the UK that has the immediate capacity

303、 to deal with a quick call to action as has been requested in and around the renewable sector following the quadrupling of wind powered energy targeted by 2030.The facilities in Belfast are ideal for both offshore static and floating wind farms.Our 556m drydock and gantry cranes are ideal for loadin

304、g out capabilities.The Prime Minister announced the largest increase in government spending in defence for thirty years.Given the number of ships planned,it looks very positive that both the Belfast and Appledore yards will be involved in some way or another.As part of our strategic review of the ov

305、erall fabrication industry,it is abundantly clear that the UK is substantially short on fabrication capacity and capability.We are fully aware that this will not be an immediate ramp up in work,but it bodes very well for the future of British shipbuilding.British shipbuilders can no longer live in i

306、solation whilst operating in an international market with export opportunities.We firmly believe in partnering and in joint venture arrangements to ensure on-time and ahead-of-budget delivery of projects.Whilst the UK does have advanced manufacturing capabilities our European neighbours have substan

307、tially more.Partnerships with the likes of Navantia who have successfully digitised shipbuilding with their Shipyard 4.0 programmes should be actively encouraged to improve domestic efficiencies,enhancing productivity and ultimately delivering cost effective projects to end clients.T eam Resolut e W

308、hen considering partners for upcoming defence programmes,we spent considerable time evaluating the options to ensure that we put a credible offering to the Ministry of Defence.In forming Team Resolute with Navantia,the Spanish state-owned shipbuilder and BMT,the UKs go-to design house we truly belie

309、ve that we have a team capable of winning projects.The initial focus will clearly be on the Fleet Solid Support project(FSS);however,we are also collaborating on several other projects across defence and cruise along with several projects in the renewable sector.I nf raSt rat a PlcAnnual Report and

310、Financial Statements 2020 x29COMPANY INFORMATIONFINANCIAL STATEMENTSAUDITORS REPORTDIRECTORS REPORTSTRATEGIC REPORTCHAIRMANS REPORTWorking in this team provides us with a substantially lower risk entry point,access to significant historical data,a comprehensive track record and a portfolio of proven

311、 hull designs that can be utilised for future bids and tenders.More importantly,it gives us access to Navantia s Shipyard 4.0 system,their program management skills,system integration and weapons systems capabilities.Whether Team Resolute prevails in the FSS tender will largely depend on the end cli

312、ents requirements.Should Team Resolute fail in its pursuit to win the FSS contract,we remain convinced that we will be successful on other projects that we are bidding for.We have built a strong working relationship with both Navantia and BMT and we look forward to working closely with as a team on

313、upcoming projects.We are acutely aware that one size does not fit all,and we will continue to form other joint ventures and partnerships for projects that have a better probability of winning with other partners.Our two iconic yellow Goliath type gantry cranes are permanent features of our Belfast y

314、ard Belf ast Faci li t y Our strategic shipyard and fabrication facility is located a short drive from Belfast International Airport.The facility is made up of two sites.Site one includes the Belfast Dry Dock(335m)and Site two includes the new building and fabrication dock(556m)along with 30,000m2 o

315、f undercover fabrication space.The facilities have deep water access and over 2,000m of quayside berths between the two facilities.There are various deep-water pockets around both sites that will facilitate larger deep drafted vessels and structures to berth and be worked on.The yard has had numerou

316、s piling works done in order to enable it to withstand large single point loads associated with the renewable industry.The facility has been reactivated in stages since acquiring the yard on the 5th December 2019.The initial stage was to get the Belfast dock up and running which included undertaking

317、 upgrade and maintenance works on the various plant and equipment.The first vessel was welcomed to the yard on the 23rd December 2019 and since then a further twenty vessels have entered the yard.After works were completed on the Belfast dock the next priority was to get the larger building dock up

318、and running,undertaking much of the same type of works.With the onset of Covid-19 and the resultant slowdown to essential works only,it was decided to take advantage of this slowdown in activity and remove the dock gate from Belfast dock to be drydocked inside the building dock for repairs,upgrade a

319、nd a multi-year preservation package.The dock gate is required to be docked every ten to fifteen years depending on routine survey works.The team made the decision to undertake the works earlier than planned to avoid taking it out of service when larger contracts became available.In addition,in orde

320、r to qualify for the Queen Elizabeth class carrier bid,the work that was required on the dock gate would be needed to be undertaken in earnest.The entire operation from commencement,floating the dock gate,demounting it and finally re-installing it lasted five months.The facility effectively operated

321、 as a single dock operation for the majority of 2020,but we are pleased to have this work behind us as we now proceed towards bigger and more time critical projects.The next phase of the reactivation process is to get the fabrication facility up and running.Whilst there is much that we can do to imp

322、rove the efficiency and productivity of the fabrication halls,we are determined to win contracts and start processing them as we gradually upgrade the facilities over the course of the next few years.We have however ordered a new Inrotech robotic micro panel line for the fabrication hall,as this wil

323、l be critical in shipbuilding and major fabrication projects.The panel line is planned to be delivered in January 2021 and will be up and running during Q1 2021 following installation and training of key members of staff.We will be looking at the longer-term upgrade plans in conjunction with our bud

324、gets as part of our ten-year plan.Given that the site is spread over 81 acres,we believe that there are innumerable opportunities to increase turnover over and above our current internal projections.Some of these opportunities will involve capital investment in order to realise the growth potential.

325、Such enhanced capital spend will be reviewed on a case-by-case basis.Appledore Faci li t y The Appledore shipyard was acquired by the group and the deal completed on 26th August 2020.The site comprises 30 acres of freehold waterfront land,a 120m fully covered drydock,a small undercover slipway,an ex

326、ternal 90m slipway,quayside and outfitting berths along with numerous fabrication and storage buildings.Historically the yard has been used for new building projects only.It is our intention to not only use it for new building projects but to also encourage repair and maintenance dockings,conversion

327、s as well as major fabrication projects.We expect the majority of this work to be undertaken in the main Bidna facility.With the extensive slipways,it is expected that commercial and patrol vessels will be docked here in addition to smaller survey and commercial fishing vessels.Given the beam that t

328、he slipway enjoys,it is expected that it will be utilized by vessels engaged in the construction and servicing of renewable energy projects in the Celtic Sea.In order to keep a tight control on cash burn,it is not planned for this facility to commence trading until early 2021.Slipway at Harland&Wolf

329、f(Appledore)The slipway at the Newquay yard was in a state of disrepair and vegetation had been allowed to overrun the site.An extensive upgrade of the slipway cradles has now been undertaken,along with repairs to the concrete slipway and new surfacing of the repair yard.The cradles have also had ne

330、w wire ropes installed along with wooden beds after full shot blasting and preservation.30 x I nf r aSt r at a Pl c Annual Report and Financial Statements 2020With the river having high tides the access channel to the slipway becomes silted up.Extensive works have been undertaken to return the slipw

331、ay access channel back to its previous depth.The hydraulic motor for control of the slipway has been returned to a hydraulic specialist for an overhaul.The slipway is in the final stages of completion and we expect a vessel to test slip in late January/early February 2021.Adjacent to the slipway is

332、the outfitting quay and berths.Whilst in the process of upgrade works,a vessel that could not wait for repairs was brought alongside for a short period making it our very first client at Appledore.Reactivating the Newquay yard was considered to be a relatively quick process and so was undertaken fir

333、st whilst planning the more complex operation of reactivating the main Bidna yard.The Bidna yard drydock operates via lowering and raising three steel gates of approximately 30 tonnes each.The gates have never been removed since the yard was built and are in a relatively unknown condition.When acquiring the yard,the condition of the gates was taken into consideration during the material condition