Vallianz Holdings Limited (“Vallianz” or the “Company”, and together with its subsidiaries, the “Group”) has entered into a binding Memorandum of Understanding (“MOU”) with SeaTech Solutions International Pte Ltd (“SeaTech”) to develop the next generation of environmentallyfriendly harbour tugs based on SeaTech’s “EVT-60” design. The MOU is valid for 2 years unless mutually extended in writing by both parties.

The all-electric tug (“e-tug”) is designed to be powered by clean energy with an aim of zero carbon emission. The e-tug will support vessel owners to comply with the 2030 and 2050 targets set by International Maritime Organisation (IMO) to reduce the shipping industry’s carbon footprint over the coming decades.

Measuring an overall length of 26 meters and beam of 12.8 meters, the e-tug will be equipped with azimuth propulsion and have a bollard pull of 60 tonnes with service speed of 12 knots. Its high-capacity electric battery modules will also pack enough power for its operational profile. Upon completing development of SeaTech’s “EVT-60” design for the e-tug, Vallianz intends to utilize the Group’s shipyard, Vallianz PT USP (a 99% owned subsidiary of the Group), to begin preparation works for potential clients and vessel owners who are interested in constructing an e-tug.

The design of the e-tug will be carried out in accordance with the American Bureau of Shipping (ABS) “Guide for Use of Lithium Batteries in the Marine and Offshore Industries” and the ABS “Guide for Hybrid Electric Power Systems for Marine and Offshore Applications”.

Instead of adapting past designs from its large database of proven tug designs, SeaTech has developed the “EVT-60” design with a brand-new battery powered concept. The power delivery of the e-tug’s battery can be optimized according to the vessel’s real-time power demand. This will result in a more flexible and efficient operation as the e-tug will have the ability to provide a range of bollard pull to meet different operational requirements.

“Technology for electric vessels is available, and the real challenge is to develop a cost-effective total logistics solution. We target a CAPEX increase of only 20% with lower life cycle costs for this electric tug. The electric tug lends itself to digitalisation and future autonomous operations. We see this as the future of harbour Tugs and we are delighted to bring this Technology to SEAsia,” said Mr Govinder Chopra, Director of SeaTech.

“This strategic partnership marks Vallianz’s first step into the development of electric vessels, which demonstrates our aim to be among the leaders recognised for active reduction of carbon emissions in the marine industry. With the rise in demand for decarbonisation, coupled with the evolving digitised efficiency management systems for vessels, we foresee increasing requirements for electric vessels in the near future. We believe the partnership with SeaTech will showcase Vallianz’s ability to diversify its strengths and constantly innovate as we work towards achieving long-term growth and sustainability,” said Mr Darren Yeo, Executive Vice Chairman of Vallianz.

“Hybrid electric power systems offer the opportunity to improve safety, reliability, operational efficiency and reduce the fuel consumption, environmental footprint and equipment maintenance when compared to traditional power systems. ABS has long supported shipowners looking to utilise this technology and is an industry leader in developing guidance that advances safer integration of hybrid power systems into marine and offshore assets,” said Gareth Burton, Vice President, Technology of ABS.

Vallianz’s partnership with SeaTech is not expected to have any material impact on the net tangible assets or earnings per share of the Group for the current financial year ending 31 March 2021.