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Financial Benefits of Mobile Natural Gas CenterPoint Energy Mobile Energy Solutions 1-844-Mobile-4 1-844-662-4534 June 26, 2017

Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

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Page 1: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Financial Benefits of Mobile Natural Gas

CenterPoint Energy Mobile Energy Solutions

1-844-Mobile-4

1-844-662-4534 June 26, 2017

Page 2: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 2

CenterPoint Energy:

Electric transmission and distribution utility in

Houston (over 2.4M customers)

Natural gas distribution utility in 6 states

(over 3.5M customers)

Competitive natural gas sales (CES)

Enable Midstream (transmission pipeline)

Intrastate pipeline (primarily in TX and LA)

Mobile Energy Solutions® (MES)

Page 3: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 3

Mobile Energy Solutions

MES specializes in the supply and

delivery of portable natural gas for

a variety of utility applications

Page 4: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 4

A division of CenterPoint Energy:

Developed in regulated gas operations

– All Technicians are PHMSA - OQ certified

Experts

– CNG and LNG

– Site Storage

– Natural Gas Supply

– Delivery and Logistics

– Odorization

Turnkey service provider

20 Years

We Do One Thing: Mobile Gas for Pipeline Support

Page 5: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 5

Customer types include:

Natural gas distribution utilities and municipalities

Transmission pipelines

Industrial and commercial customers

Customer Profiles

Page 6: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 6

Portable Natural Gas Supply Applications:

Pipeline integrity (planned outages)

Supplemental gas supply for winter peak shaving and system pressure loss

Emergency response (unplanned outages)

Planned pipeline maintenance and construction outages

Temporary supply for new developments waiting for a pipeline connection

Start-up and commissioning of equipment and facilities

Applications for Temporary Gas Supply

Page 7: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 7

CNG

Natural gas dehydration

CNG tube trailers (30 units) CNG farm tap mini-trailers

(50) Units

CNG cascades (10

Units)

Portable compression

(trailer fill in 60 minutes)

LNG

Fleet of Equipment

450 Mcf/h Vaporizer (Gas Fired)

250 Mcf/h Vaporizer (Gas Fired)

100 Mcf/h Vaporizer (Ambient)

Up To 700 Psig

PLC Controlled

Odorizer

Page 8: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 8 CenterPoint Energy Proprietary and Confidential Information

MES Portable Pipeline Equipment

LNG Equipment Pictures

Ambient LNG

vaporizer

100 Mcfh up to

230 psig

LNG Pump skids 350 psig LNG ISO Container 10,000 gal. Heated vaporizer

400,000 scfh up

to 700 psig

Page 9: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 9

Individual rural farm taps

Town and city gate stations

and distribution systems

Large industrial customers

CenterPoint Energy Mobile Energy Solutions

Fleet and Expertise

to serve the entire

spectrum of natural

gas utility supply

needs:

9

Page 10: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 10

Preplanning and Project Management:

Defining the job requirements

Location

Start date

Duration

Max daily gas volume (Mcfd)

Max hourly gas volume (Mcfh)

Delivery pressure

Conduct a site visit

Complete turnkey project execution / operation

Mobilization

Set-up

Gas delivery

Demobilization

Full Project Management

Page 11: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 11

Full Project Design and Engineering

Other Considerations:

Key stakeholders – Engineering, Operations, Gas

Control, Contractors, Gas Marketers, Customers

Gas Management Plan and Communications

Overpressure Protection

Remote Monitoring

Risk Assessment

Page 12: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 12

Qualifications:

Safety is #1! “Always, everyday, everywhere!”

Over 100 years of combined CNG experience

Over 100 years of combined LNG experience

CNG and LNG certified technicians

Technician Training

– PHMSA - Operator Qualification (OQ)

– Natural gas utility and pipeline safety

– LNG fire safety (Texas A&M training program)

Technicians have CDL certification

CNG and LNG licenses

DOT security plan

Proper insurance requirements

Customer and employee safety

are our #1 priorities

Success Factors

Page 13: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 13

CNG

CNG

Page 14: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 14

CNG

CNG:

Quick response

Smaller volumes

No impact to customers

No customer equipment modifications required

Seamless transitions from and back to pipeline gas

CNG comes odorized

170,000 Scf per Trailer

Page 15: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc.

CNG General Layout

Page 16: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 16

LNG

Page 17: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 17

LNG

LNG:

Accommodates much higher flow rates

Excellent for longer term projects

More volume per tanker

Minimal impact to downstream customers

LNG is not odorized

820,000 Scf per Tanker

Page 18: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc.

LNG General Layout

Page 19: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 19

Winter Peak Demand Service

Equipment on Site November 1st – March 31st

Multi Year contracts for seasonal coverage recommended

Fixed Costs: Mobilization, Equipment Rental, De Mobilization

Variable Costs: Labor, Per Diem, LNG

Benefits:

– 100% Turn Key Service

– Reduced Transmission Capacity Costs

– New Equipment

– No Maintenance Costs

– No Permanent Site infrastructure to permit

– No need to hire contractors or train employees to operate or maintain the systems

Page 20: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 20

CenterPoint Energy is a Gas Supplier

WACOG

– Weighted Average Cost Of Gas

– The Gas and Transport costs of mobile gas supply are typically averaged into

the total delivered gas costs for the entire rate base.

PGA

– Purchase Gas Adjustments

– The total cost of Mobile Gas is usually passed through on the PGA to the end

users

Gas Supplier VS Construction Contractor

– Supplier of Gas and Mobile Pipeline

– Not a contractor that typically requires operational dollars

Page 21: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 21

Natural Gas Pipeline Interruptions

Solution / Result

Co

st

Reco

ve

red

imm

ed

iate

ly i

n P

GA

On

e C

all

to

Ma

ke

Dir

ect

Cu

sto

mer

Imp

act

Lo

ss o

f G

as S

up

ply

Lo

ss o

f G

as S

ale

s

En

gin

eeri

ng

in

ten

siv

e

Op

era

tio

na

l C

os

t

Co

nti

nu

ed

Ma

inte

na

nc

e C

os

ts

Inclu

de

d i

n f

utu

re

inte

gri

ty t

esti

ng

co

sts

Co

st

Reco

ve

red

in

Next

Rate

Case

Relight/Shut Off x x x x x x

Lateral Line x x x x x

Temporary Line x x x x

Mobile Energy

Solutions®

x x

Page 22: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 22

Natural Gas Pipeline Interruptions

Relight

– Outages directly impact customers and cause impacts at all levels of the company including; billing, legal, insurance, risk, operations, public relations and more.

– Loss of metered gas sales to all affected customers, reduced income

– Scheduling meter turn on and safety appliance inspections costs on average $75 to $125 if everything goes well. This process consumes resources and interrupts regular operations

– Engineering resources are utilized to track shut off and relight for all affected meters

– This cost must be recovered in the rate case, it hits the bottom line initially and hurt total profitability

Mobile Energy Solutions® can assist in avoiding relights.

Page 23: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 23

Natural Gas Pipeline Interruptions

Temporary Lines

– Engineering Intensive; routing, permitting, safety, line isolation and moving gas

to temp line then back to primary line.

– Operational costs hiring contractors to install, run and monitor the line, risk

– Continued maintenance costs with the line isolation devices (stopples, etc.)

– The isolation devices will be included in future integrity testing schedules

– The total costs for this would be paid by the operational budget, effect

profitability and be recovered in a future rate case process

Mobile Energy Solutions® can assist in avoiding the engineering, permitting and

laying of temporary lines.

Page 24: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 24

Natural Gas Pipeline Interruptions

Lateral Line

– Engineering Intensive; routing, permitting, safety, line isolation and moving gas to lateral line then back to primary line after testing.

– Operational costs hiring contractors to install, run the line, risk of boring incident, risk of trenching incident

– Continued maintenance costs with the line isolation devices (stopples, etc.) and the largely unused pipeline

– The under utilized line and the one time used isolation devices will be included in future integrity testing schedules

– The total costs for this would be paid by the operational budget, effect profitability and may be recovered in a future rate case process

Mobile Energy Solutions® can assist in avoiding costly and largely unused lateral lines.

Page 25: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 25

Natural Gas Pipeline Interruptions

Mobile Energy Solutions®

– Transportation and natural gas supplier

– All costs for this service are part of total natural gas transportation and supply

– Turn Key, One Call service provider

– Full Scale Provider with a Full Scale Fleet

– Close to Louisiana for operational efficiency and rapid response

– Competitive in total cost to all other solution. Reasonable and Prudent.

Page 26: Financial Benefits of Mobile Natural Gas...Proprietary and Confidential 7 Mobile Energy Solutions, Inc. CNG Natural gas dehydration CNG tube trailers (30 units) CNG farm tap mini-trailers

Proprietary and Confidential Mobile Energy Solutions, Inc. 26

Thank You

1-844-Mobile-4

1-844-662-4534 James Hulse

Cell: 832-570-7517

[email protected]

[email protected]