Green Bond Fact Sheet

Mitsui O.S.K. Lines

Date: 31-Aug-2018

Issue date: 30-Aug-2018 Maturity date: 30-08-2023 Tenor: 5Issuer Name

Mitsui O.S.K. Lines

Amount Issued

JPY5bn (USD45m)

Country of riskJapan

CBI Database

Included

Issuer Type1

Non-FinancialCorporate

Bond Type

Senior unsecured

Green Bond Framework

N/A

Second party opinion

Vigeo EIRIS

Certification Standard

Not certified

Assurance report

N/A

Certification Verifier

N/AGreen bond rating

N/A☐ Energy☐ Solar☐ Onshore wind
☐ Offshore wind
☐ Geothermal☐ Hydro☐ Tidal☐ Biofuels☐ Bioenergy☐ District heating☐ Electricity grid

☐ Energy storage☐ Energy performance☐ Infrastructure☐ Industry: components☐ Adaptation & resilience☐ Buildings☐ Certified Buildings☐ HVAC systems☐ Energyperformance☐ Water performance☐ Energy storage/meters☐ Other energy related☐ Industry: components☐ Adaptation & resilience☒ Transport☐ Electric vehicles☐ Low emissionvehicles☐ Bus rapid transit☐ Passenger trains☐ Urban rail

☐ Freight rolling stock☐ Coach / public bus☐ Bicycle infrastructure☐ Energy performance☒ Shipping☐ Transport logistics☐ Infrastructure☐ Industry: components☐ Adaptation & resilience☐ Water & wastewater☐ Water distribution☐ Water treatment☐ Wastewatertreatment☐ Water storage☐ Storm water mgmt
☐ Desalinisation plants☐ Erosion control☐ Energy performance☐ Infrastructure☐ Industry: components☐ Adaptation & resilience☐ Waste management☐ Recycling☐ Waste prevention☐ Pollution control☐ Landfill, energy capture☐ Energy performance☐ Infrastructure☐ Waste to energy☐ Industry: components☐ Adaptation & resilience

Use of Proceeds☐ Land use & agriculture☐ Afforestation/parks☐ FSC Forestry☐ FSC Cellulose &paper☐ Land remediation☐ Energy/water efficiency☐ Sustainable agriculture☐ Adaptation & resilience☐ Other☐ Adaptation &resilience☐ ICT☐ Industry: process

Issue details
ReportingThe issuer will report annually on proceed allocation and on the environmental impact ofprojects at a project category level. The list of reporting indicators is available here. Reports
will be published on the issuer’s website.

Company information

Mitsui O.S.K Lines is a Japanese transport company and one of the largest shipping
companies worldwide. The company is headquartered in Tokyo, Japan.

Firsts, records andcertifications

Second green bond issuer from the shipping sector.

Proceeds description

As with NYK’s green bond, proceeds will be used by MOL to finance and refinance LNGfuelled ships, LNG-bunkering ships, ballast water management systems and SOx scrubber
systems. Under its Green Bond Framework, MOL has committed to ensure the financed
vessels will not be used to transport products that relate to controversial activities,
including, but not limited to, coal, tar sands and oil shale.
Additionally, Upgraded Propeller Boss Cap Fins (PBCF….yes they are a thing) and the Wind
Challenger Project are also eligible under MOL’s. According to the issuer, the upgraded
PBCF is expected to yield 5% energy savings compared to vessels unequipped with thetechnology. The Wind Challenger Project is a research project led by the University ofTokyo focused on the development of wind propelled ships through the use of a rigid sailsystem. MOL aims at deploying the technology on cargo-carrying vessels to achieve up to50% energy savings.

Climate Bonds view

We are pleased to see that the issuer has quantified the level of emissions reductions
expected for each eligible project and committed to providing annual impact reporting
based on operational data. Investing in the Wind Challenger Project is a positive step
towards incorporating renewable technologies in vessels. So is the commitment nottransport fossil fuel products other than LNG on the LNG bunkering ships.
As we pointed out for NYK’s green bond, switching to LNG-fuelled vessels is not enough tocomply with a 2-degree decarbonisation trajectory in the long-run. However, the projects
financed by the deal are currently the lowest-emission asset option until other renewablefuels become commercially viable. It is nonetheless important to ensure the vessel design isflexible enough to avoid fossil fuel lock-ins in the future. Our special briefing provides more
information on our decision to include bonds financing LNG-fuelled ships and LNGbunkering ships in our database.

Underwriters

Daiwa, Nomura

Deal comments
Credit Rating
Pricing summary

A- (Japan Credit Rating Agency, Ltd.)

Investors summary

1Issuer categories: ABS, development bank, financial corporate, government-backed entity, loan, local government, non-financial
corporate, sovereign