KUALA LUMPUR (April 19): MISC Bhd, via its petroleum arm AET, has entered into time charter party contracts with PETCO Trading Labuan Company Ltd (PTLCL) for the world’s first two ammonia dual-fuel Aframaxes (tankers with a deadweight of between 80,000 and 120,000 tonnes), as it seeks to reduce overall emissions from its operations.

Both MISC and PTLCL are units of  national oil company Petronas.

In a statement on Friday, MISC said the tankers will enable PTLCL to transport its products to customers around the world while contributing to the industry decarbonisation by utilising ammonia as the cleaner alternative to conventional fuel.

AET has also signed shipbuilding contracts for the two vessels with Dalian Shipbuilding Industry Co Ltd, a subsidiary of China State Shipbuilding Corporation, said MISC.

"Today's signing of the time charter party and shipbuilding contracts is a clear testament of turning ambition into action. These partnerships seamlessly align with our collective vision of driving meaningful and purposeful change globally as we progress towards a net-zero future," said MISC president and group chief executive officer Captain Rajalingam Subramaniam.  

Meanwhile, AET president and chief executive officer Zahid Osman said that with the signing of the contracts, the company will take concrete action to deliver on its commitment to progress the decarbonisation of the shipping sector.

"The introduction of these two vessels will reduce the overall emissions from our operations whilst we deliver more energy for the world," he said.

Moving forward, MISC said it will look to further collaborate with like-minded industry players to drive the development of the required ecosystem to support ammonia as a bunker fuel.

"MISC Group looks forward to leading the charge in sustainable maritime transportation and continuing to push the boundaries of what is possible in the industry," it added.

MISC's net profit for the financial year ended December 2023 came in 16% higher at RM2.12 billion versus RM1.82 billion in the previous year, thanks to better charter and freight rates. Revenue rose 2.9% to RM14.27 billion from RM13.87 billion.

Shares in MISC rose 18 sen or 2.3% to RM8.01 at Friday's market close, valuing the group at RM35.75 billion. Over the past year, the counter has risen 69 sen, or 9.4%.