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CONFIDENTIAL 2
North American Gas Supply (Source: McKinsey & Co.)
CONFIDENTIAL 3
Global LNG Bunkering Demand
North America
Europe and the Baltic Sea
China
Japan and Korea
Southeast Asia
Australia and New Zealand
Middle East and India
South America
0.9 – 1.4 million
1.4 – 2.2 million
0.3 – 0.4 million
0.3 – 0.7 million
0.4 – 0.7 million
0.1 – 0.2 million
0.3 – 0.5 million
0.3 – 0.8 million
0.07 – 0.09 million
Source: DNV GL.
LNG bunkering demand 2012
LNG bunkering demand 2020
Annual North America demand
projected to reach 559 to 869
million LNG gallons by 2020 (Equates to 1.5 to 2.4 million
LNG gallons per day)
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Global Shipping - Trade Routes
Global Shipping Trade Routes
In a global shipping market, North America may become an important fuel stop.
US Marine Bunkering – Top 10 States
Source: Pace Global, based on 2011 EIA data.
CONFIDENTIAL 6
Announced NA LNG Bunkering Projects
Associated with large scale facility:
Small scale stand-alone:
Major LNG Marine Demand News Company News
Harvey Gulf International Marine has prepared the launch of the first of at least six natural-gas/diesel fuel offshore supply vessels. These ships will be based out of Port Fourchon, LA, which has vessel movement averaging 270 ships per day.
TOTE has evaluated options for fueling their LNG fueled container ships and is converting two 839-foot vessels to LNG/diesel dual-fuel operations. Each ship will have twin 900-cubic-meter LNG tanks (476,000 LNG gallons per vessel).
Seabulk Tankers Orders Two LNG-Ready Product Tankers from NASSCO. San Diego shipyard General Dynamics NASSCO has entered into a contract with Seabulk Tankers, a wholly owned subsidiary of SEACOR (NYSE: CKH), for the design and construction of two LNG-ready product tankers to operate in the Jones Act market.
Crowley Maritime has ordered as many as eight new petroleum tankers that are constructed with consideration for the use of LNG as fuel in the future.
Matson has recently ordered two 4,000 TEU LNG-fueled ships with the option for three additional ships.
Horizon Lines has proposed to convert two 801-foot container ships to LNG/dual-fuel operations.
United Arab Shipping Company has ordered ten 18,000 TEU LNG-ready vessels with options for seven additional ships, totaling more than $2 billion. An 18,000 TEU ship is estimated to consume more than 115,000 LNG gallons per day.
Source: Press releases; Westlake Securities market research.
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Bridging natural gas supply and High Horsepower demand.Providing LNG “time and place utility” for High Horsepower fuel.
LNG where needed, when needed, and in the quantity needed.Developing reliable supply through a network of intermodal
delivery infrastructure and strategic storage depots.LNG America Target Asset Base
Asset based infrastructure
Liquefaction Transport and Logistics
Storage
LNG Production, Transport and Logistics, and Delivery
Markets
Rail
Marine
Drill Rigs
HD Trucks
Mining
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LNG from North America’s largest single LNG supply point: Over 30 million gallons per day of LNG production
capacity under construction with over 200 million gallons of LNG storage.
LNG Gulf Coast Supply
Sabine Pass provides central access to U.S. Gulf Coast.
Provides for tremendous growth in domestic bunkering and fueling business.
Economies of scale provides competitive fuel and higher reliability. Cheniere’s Sabine Pass LNG facility fully
approved, financed, and under construction.
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LNG America feasibility study conducted to determine viability of U.S. LNG as global marine and HHP fuel. LNG bunkering happening globally and coming to the U.S. Adoption rates are impacted by ship type and service
routes. “Soft side” includes operating policies approved by Port &
USCG; significant progress in Europe provides blueprint. Demand will be slow at the start, but will grow steadily. Rate of change is impacted by availability of LNG bunkering
supply.
US LNG as Marine Fuel – Feasibility Study
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Texas and Louisiana have nine of the top 15 ports in the U.S.
Major U.S. Gulf Coast Ports
At 4 MTPA, the Port of Houston area is the largest bunkering market in the U.S.
LNG America is centrally positioned on the US Gulf Coast
CONFIDENTIAL 12
Offshore Service Vessels (OSV’s)
LNG fueled offshore service vessels (OSV’s) are expected to serve the hundreds of offshore platforms in the Gulf of Mexico.
Harvey Gulf has recently ordered six LNG powered Offshore Service Vessels (OSV’s) as sketched above, plus have options for four more. These 310 foot long vessels serve 31 floating drilling units, 29 jackups and 9 platform rigs.
CONFIDENTIAL 13
Hub and Spoke Supply Chain
Storage and Fueling Depots
MarineRoad/Rail
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Common LNG Bunkering Methods
The common bunkering methods used for oil bunkering will also be used for LNG bunkering (Truck-to-Ship (TTS), Tank/Pipeline to Ship (TPS), Ship to ship (STS)).
Make LNG bunkering look like oil bunkering
CONFIDENTIAL 15
Facility Evolution - Vessel• Coast Guard approved concept of LNG bunker barge.• Tanker barge serves as shuttle vessel and bunker vessel.• Ability to perform “Just In Time” bunkering service.• US waterways very accustomed to barge traffic.
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Developing a blend of marine competency and LNG competency.
Operating procedures and practices Look to new existing policies in EU, Adapt to fit U.S., Educate and get “buy-in”. Developing the industry standard
Coordination with large scale operations Know what is important, and when it is important.
Sensitivity to the local communities. Time of day; traffic issues
Sensitivity to marine customer issues. Our main purpose may be to fuel, but theirs is not.
Challenges of Getting into Operation
CONFIDENTIAL 17
Historically
Emerging
Communicate the Benefits of LNG
LNG Global Gas Industry
LNG Global Fuel Industry
• Gas and electric utilities
• High horsepower (HHP) engines
Two major industries, Natural Gas and HHP engines, are coming together using LNG as the bridge.
Communicate, Cooperate, Coordinate
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LNG Bunkering in North America is beginning to happen. Using natural gas to displace oil has economic and
environmental benefits. Providing LNG as fuel in major ports creates additional ECA
compliance options.
Utilizing a large scale LNG production facility can provide economies of scale and enhanced reliability.
A unique opportunity exists for global collaboration and cooperation to build a bridge between two industries to ensure a safe and smooth transition.
LNG America - Conclusions
www.lngamerica.comKeith Meyer: [email protected]
LNG America – 505 N. Sam Houston Pkwy E., Suite 545 Houston, Texas 77060 – USA (281) 448-1114
