This printed article is located at https://leaderet.listedcompany.com/chairman_statement.html
2023 was a year marked by the Group’s strategic push towards strengthening its foothold in the market with Leader’s proprietary Artificial Intelligence Water (“AIWater”) technology, along with focus on municipal and oily sludge treatment.
We entered 2023 contending with China’s weak economic recovery as it emerges from the impact of its stringent COVID-19 restrictions, which had caused our Group’s business activities to be sluggish. Nonetheless, we had worked on streamlining the Group’s business activities, and ended the year with good progress and laying the basis for a strong 2024. We had focused on developing our team and enhancing its expertise to ensure consistently high level of support for our customers’ operations can be delivered.
The Group has developed its AIWater technology by integrating artificial intelligence (“AI”) with digital twin technology to achieve AI sensing, prediction, and control of equipment for management of wastewater treatment plants (“WWTPs”). Our AIWater system optimizes WWTP operations to achieve lower carbon and more cost-effective operation while maintaining process stability and legal compliance of the discharge. The Group has successfully deployed AIWater at 8 plants in China, and achieved documented reductions in electricity and chemicals consumption, and overall operating costs coupled with lower carbon emissions.
Our transformation into a technologydriven company is further evidenced 15 AIWater projects secured in China to treat 1.5 million ton/day of municipal and industrial wastewater. A majority of these projects were secured under the model of Environment Resource Management Contracts (“ERMCs”) for tenures ranging from 6 to 10 years during which the Group will earn a share of the cost savings arising following implementation of AIWater at the existing WWTPs. These ERMCs will provide the Group with long-term recurring incomes with minimal capital investments.
China generates more than 220 million tons of municipal wastewater and 60 million tons of industrial wastewater daily. We believe that our AIWater is unique and a leading technology to effectively improve the performance and cost-effectiveness of existing wastewater treatment plants without much additional capital investment, and has potential in China’s quest to reduce its carbon footprint.
In the area of municipal sludge treatment, the Group’s proprietary Continuous Thermal Hydrolysis (“CTH”) and pyrolysis technologies can reduce investment and operating costs substantially by up to 70% while reducing carbon emissions by approximately 50% as compared with traditional sludge drying technology followed by landfilling or incineration. The Group is actively marketing and deploying its CTH and pyrolysis technologies and has secured a project with contract value of RMB22.5 million in Taiwan to design and supply equipment to treat 80 ton/day of sludge. There are currently more than 4,500 municipal sewage treatment plants in China generating more than 60 million tons of sludge annually. We believe that our CTH and pyrolysis technologies could provide cost-effective solutions to address the sludge issue in China.
The Company, partnered with Nanyang Technological University (“NTU”) and was awarded a grant of S$3.9 million to conduct a demonstration project of the Company’s CTH and pyrolysis technologies for sludge treatment at the Changi wastewater treatment facility. The Company, with this project, is preparing itself to address the Singapore and ASEAN markets.
In 2023, we added oily sludge treatment to our technology and equipment offerings. Conventional treatment of oily sludge uses the heating process (with fuel consumption) for onshore oil and gas facilities. This, occupies large area and poses fire safety concerns, making it unsuitable for offshore oil platforms and floating production storage and offloading (“FPSO”) vessels. Leader addresses the challenging operating environment with our Electromagnetic Induction Pyrolysis (“EIP”) technology and equipment for treatment of oily drill cuttings arising from drilling operations at offshore oil platforms. We believe this breakthrough technology and equipment is an advanced and safer approach for treatment of offshore oily drill cuttings which replaces the current practice of transporting the cuttings back to land for onshore treatment. Our technology not only offers more effective processing, but also effectively avoids the environmental and technical risks associated with moving pollutants off-site for treatment. We believe our EIP technology will have potential to be deployed at oilfields in China, Southeast Asia, the Middle East, and the North Sea for oily sludge treatment on offshore drilling platforms.
The Group has positioned itself at the forefront of membrane manufacturing and application with introduction of its Ti Membrane. This was developed with membrane fabrication which successfully integrated Ti nano crystals onto the polymer and so providing superior fouling and water treatment performance control. The Group’s membrane production line is ready to take orders from customers for the enhanced membrane.
In July 2023, the Group had completed the issuance of the USD15 million convertible bonds (“CB”). With these cash proceeds, the Group can grow its AIWater, sludge and membrane business segments.
Technology continues to be our driving and defining force for sustainable growth of our business. We see great market potential for our AIWater, CTH municipal sludge treatment, and EIP oily sludge treatment technologies. With this committed focus on investing and developing decarbonization and green technologies, Leader will continue its transformation into a green technology driven and asset-light business model as compared with the traditional capital-intensive investment in projects mode.
With the concerted effort of our team in seeking new heights in our quest to bring greatest value to our stakeholders, we seek to deliver exceptional value in all that we undertake, beyond conventional boundaries.
All that we have achieved in 2023 were made possible by the commitment and dedication of our people. I would like to take this opportunity to express my gratitude for the continued support and trust from our shareholders, customers, management team and employees.
On behalf of the Board, I would also like to express my heartfelt appreciation to Independent Non-Executive Director, Mr Mak Yen-Chen Andrew. He will retire on 29 April 2024 after serving more than 13 years with the Company. We would like to express our appreciation for his invaluable contributions and I wish him all the best in his future endeavours.
At the same time, I am pleased to welcome Emeritus Professor Ng Wun Jern as the new Independent NonExecutive Director appointed to the Board. The Group can tap on his valuable experience as we work towards our strategic goals.
In 2024 we look to realise the results of the groundwork done in 2023 and will continue our work to provide innovative solutions that will bring value to the industry while meeting environmental conservation goals.
Executive Chairman