Jean-Louis Pairon (pronjnl@skynet.be)

Evolution in the LNG Receiving facilities

From Onshore to

FSRU and small scale

GDF SUEZ Energy International

Date: 09-06-2013

Until beginning of the years 2000, all the terminal were build onshore. Tendency to increase the size of the facilities to reduce the regas unitary rate.

Such concept was supported by the regulated gas market or by the large capacity of the target market (US)

Evolution in the LNG receiving facilities

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LNG Receiving Onshore Terminal

Investment cost estimate

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LNG Receiving Onshore Terminal

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As from 2005, considering the difficulty to find adequate site to develop onshore facilities and the difficulties to obtain the permits, idea to transfer the facilities offshore

In addition, energy market also changed with the deregulation and arrival of new (smaller) potential clients pushing the industry to develop new concepts:

Floating Facilities (FSRU)

Small scale LNG chain

in order to reduce the costs and increase the flexibility

Evolution in the LNG receiving facilities

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• First projects:

• Gulf of Mexico (Energy Bridge - Excelerate with Exmar)

• Bay of Massachusetts (Neptune SRV: Engie with Hoegh LNG, Excelerate Energy Bridge)

• Mooring of the ship done using offshore buoy (APL system). Proven

technology in the oil industry

• No LNG unloading in open sea; the vessel goes back to the loading port

to be reloaded

Off shore Terminal – Initial concept

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Put these regas vessels alongside a jetty to answer to peak demand (temporary solution to cover additional winter demand, bridge solution, ..)

Installation of a gas send-out line near the LNG manifold

First application: Teeside GasPort (started operation 2007, decommissioned in 2015)

Ready to start operation within 18 month from site selection, using an existing jetty

Same concept applied afterwards in Argentina (Bahia Blanca, Escobar)

Concept evolution

From offshore to nearshore

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Linked to uncertainty of future demand, FSRU may offer a flexible terminaling solution as applied in Brazil(possibility to relocate the FSRU)

Concept evolutionFrom offshore to nearshore – Usage as (semi)permanent facility

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Concept evolution – FSRU as permanent

terminaling solution (Uruguay LNG)

BOOT for 15 years for the infrastructure and20 years for the FSRU

Project offshore (~3 km) with breakwater

Project requirement of large storage capacity. Initial concept: 1 FSRU of 170,000 m3 + 1 FSUProposed solution: FSRU Max of 262,000 m3 storage capacity

Unloading via a jetty; possibility to reload medium size LNG vessel

Secondary jetty for small scale LNG

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2 options for FSRU: converted vessel or new build

Majority of FSRU are new build

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Several possible technologies:

Internal or External Turret Mooring System (Buoy)Type depends of water depth, ship equipment, …

Spread mooring

Jetty, connected or not to the shore

Selection between these different options depends on site condition and FSRU characteristics

FSRU Mooring Technologies

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FSRU: LNG Transfer

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Close loop (heat coming from steam produced on board) or Open loop (using sea water for heat input)or mixed vaporization system

With our without an intermediate fluid (propane, glycol, …)

Selection depends on environmental constrains and sea conditions (temperature, turbidity, …)

Majority of the new FSRU are equipped with open loop, complementary with some heaters to cover low sea water temperature

FSRU: Vaporization system

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Contract duration For existing ships (3 to … 10 years)

For new build: 20 + 5 years (without dry docking for 20 years)

Pricing Capex part: between 95,000 and 130,000 USD/day

(depending of vessel type, contract duration and market conditions; could be even lower in some conditions)

Opex part: between 20,000 and 25,000 USD/day (without fuel consumption)

Fuel consumption could vary from 50T/d up to around 200T/d depending of propulsion type and vaporization type

FSRU: Pricing elements

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Around 45% of regas projects worldwide are FSRU projects

For terminal up to 5 Mtpa and a storage capacity of 170,000 m3, FSRU solution can be up to 30 to 40% cheaper

Concept is even envisaged for liquefaction projects

FSRU: Comparison with onshore solutions

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Large part of the costs (and nearly independent of the send-out) are the costs associated with the unloading and the storage facilities

Optimization to get between reduced transportation costs (increasing the size of the vessels) and costs of the receiving facilities (jetty and tank linked to the size of the supply vessel)

New tendency: development of satellite plants (small scale LNG facilities). Small scale LNG may also be used for stranded assets

An other way to reduce the costs:

Reduce the size of the facilities

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Small scale LNG represents today a market of 20 mtpa (in addition of the 300 mtpa for large facilities) with more than 100 facilities; with an additional 10 mtpa by 2020.

Most growth in China

Used to deliver gas to remote area (not connected to the transportation grid) or when gas is used as transportation fuel (ECA area – Scandinavian countries)

Small scale LNG

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Typical small scale LNG chain

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LNG market is evolving fast:

From virtual pipeline to spot trade

From large to small facilities

From long term to short term contract

Recent evolution:

Floating facilities

Small scale

Conclusion

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Questions

Thanks