Sea NG - Small Market Gas Project Development

1CONFIDENTIALCONFIDENTIAL

Coselle® CNG TransportationSEA NG CORPORATION

2016 OVERVIEW


• Recognized as a world leader in marine CNG

• Senior team of commercial and engineering professionals

• Over 15 years of engineering, testing and development

• Advanced projects with many of the world’s leading gas producers

Sea NG is a energy project development company connecting gas reserves with

regional energy markets


Outline

1. Marine CNG

2. CNG market

3. Coselle® technology

4. Floating CNG

5. Commercial


Sea NG Alliance

Finance and Resource Mobilization

US$63 billion in assets with 6,000 employees

Ship Construction and Operations


Gas Infrastructureand Contracting


Technology and Project Developer

Owns all rights to patented Coselle® System


MARINE CNG


Compressed Natural Gas

CNG has a long history of safe transportation onshore• Gas pipelines transport compressed gas• 30 year history of transporting CNG by truck• CNG fuels more than 15 million motor vehicles (Amer. Gas Assoc.)

Large-scale marine CNG transport• Historically unrealized due to limitations of small pressure vessels• Sea NG’s Coselle® System makes large-scale, ship transportation of

CNG safe, simple and economic• New application of tried and tested technology


Marine CNG: always a gas

Provides the capability of a pipeline

Loading: Dehydration, compressionTerminals: Onshore or offshore (buoy/platform)Ships: Simple – shuttle carriers with storageReceiving: Decompression and connection to customer

SUPPLY DEHYDRATION AND COMPRESSION

DECOMPRESSION

CNG SHIPS

CONSUMER


LNG: gas > liquid > gas

Loading: Gas treatment, liquefaction and storageTerminals: Onshore in harbor / offshore liquefaction Ships: Sophisticated, efficientReceiving: Storage, regasification, harbor / offshore regas

SUPPLY

TREATMENT ANDLIQUEFACTION

LNG TANKER

STORAGE

STORAGE REGAS COMPRESSION

RECEIVINGFACILITIES

CONSUMER


Maximum density ≠ maximum economics

1 cf 2 cf

600 cf

600:1-162 oC

300:1275 BAR

LIQUEFY

LNGEXPENSIVE

COMPRESS

CNGINEXPENSIVE


CNG: 75% CAPEX in ships provides cost/schedule certainty

LOADING UNLOADINGTRANSPORT


MARKET


A worldwide reduction in flared gas

• Reduce offshore flaring• Over 10 billion cubic feet of gas is flared worldwide every day• Anti-flaring legislation will limit deepwater development

• Market stranded gas • Export to markets not suitable for pipeline or LNG• Export from gas fields not suitable for LNG or pipeline • Able to monetize several small reserves in sequence by

moving fleet from field to field over time


Challenges for coastal based energy systems

• Often isolated

• Limited demand

• Not connected to continental grid

• Limited footprint for infrastructure

• Environmental imperative


Value for power and industrial consumers

• Reduction of fuel cost

• Diversification of fuel supply with natural gas

• Reduction in operating and maintenance costs

• Reduction in emissions

• Capture of carbon credits


Environmental benefits for fuel substitution

• A power plant switching from HFO to CNG reduces:▼ Carbon dioxide (CO2) by 28%▼ Nitrogen oxides of (NOx) by 78%▼ Particulates by 92%▼ Sulphur oxide of (SOx) by 100%▼ Mercury by 100%

• Clean Ship technology• Sea NG’s ships run on clean-burning natural gas


Marine CNG is a floating pipeline

Market need for marine CNG

Many markets are still not connected to natural gas

LNG30%

PIPELINE70%


Applications for marine CNG

Marine CNG delivers natural gas to regional energy markets

Active and potential project development

• Fuel switching: Delivering low-cost natural gas to liquid fuel customers

• Transportation of “stranded” offshore natural gas

• Transportation of offshore associated natural gas

• Bridging price arbitrage between regional energy markets


Market for marine CNG

DRIVERS PRODUCERS CONSUMERS ECONOMIC Capture/enhance value

of gas reservesLower energy cost, diversify

source of supply ENVIRONMENTAL Reduce flaring Reduce CO2 emissions


Floating CNG (FCNG) provides access to stranded gas

Data Source: IHS International


In 229 fields are in CNG distance range

in 150 deep water fields

Data Source: IHS International - *Offshore non-producing fields

140 TCF

225 TCF

Potential number of projects with FCNG vs FLNG


CNG shuttle shipIs loading

Reservoirgas

Floating CNG provides shuttle off-taking service

Treated andProduced gas

Next CNG ship is approaching buoy

Gas FPSO•Processing•Condensate storage and offtake•Compressed gas to CNG ships•Processed gas to FLNG vessel


TECHNOLOGY


Evolution of Sea NG’s Coselle® system

Patented Sea NG Bottle Ship (1998) ~ 745 Bottles = 75mmscf

Original C25 = 75mmscf New C20 = 75mmscf

Columbia Gas (1965)


Pressure bottles versus Coselles

≈170 bottles 6 Coselles


The Coselle®

Capacity 4.1 MMscf116 Mscm

Pressure 4000 psi275 bar

Temperature 90OF32OC

Pipe Size 168mm OD x 6.35mm

Pipe length 21,350m

Outer Diameter 23.7m

Inner Diameter 12.8m

Height 3.1m

Weight (empty) 630mt

Pipe Steel X80 ERW


ABS safety comparison - Coselles® vs. large diameter bottles

Coselle®: Type ILength/Diameter > 1000

Cylinder: Type II & III Length/Diameter < 100

Rupture Low energy release High energy release

Gas release handling

Choked flow safe handling Difficult to handle

Fragmentation Small and non-detrimental to hull Large and catastrophic

Support Simple Complex

Arrangement Single and isolated Clustered

Piping Simple Complex

Table provided by ABS


A decade of research, engineering and testing resulted in full approval at an operating

pressure of 275 barg (4000 psig).

Fully tested and fully approved

Exceeded ABS requirements. Critical fatigue testing exceeded requirements by 300% without

failure (65,000 cycles).

ABSAPPROVED


Coselle® System

A1 Compressed Natural Gas Carrier


Sea NG ship fleet

* Net Capacity is net of heel gas and assumes lean gas at 27 oC

Ship C16 C20 C25 C30 C36 C42 C48 C56 C64 C72 C84 C96 C112

Ship Characteristics

Length OA (m) 153 153 178 204 210 236 261 267 272 244 267 290 290

Length BP (m) 149 149 173 198 204 229 254 259 264 237 259 282 282

Breadth (m) 26.5 26.5 26.5 26.5 30.0 30.0 30.0 33.0 36.0 47.2 47.2 47.2 47.2

Depth (m) 15.7 18.8 18.8 18.8 22.1 22.1 22.1 25.2 28.3 27.4 27.4 27.4 31.3

Loaded Draft (m) 5.6 6.8 7.0 7.2 7.7 7.8 7.9 8.3 8.6 8.5 8.8 9.1 10.4

Drydock Draft (m) 4.6 5.7 6.0 6.2 6.8 6.8 7.0 7.4 7.7 7.7 7.9 8.2 9.4

Net

Capacity

Coselles® 16 20 25 30 36 42 48 56 64 72 84 96 112

(million scf)* 66 82 103 123 148 172 197 230 262 295 344 394 459

(million scm)* 1.9 2.3 2.9 3.5 4.2 4.9 5.6 6.5 7.4 8.4 9.8 11.1 13.0


Jetty loading facility

1 Inlet gas via pipeline2 Inlet separator3 Knockout drum4 Flare stack5 Regen gas heater6 Gas compressors7 Sea water supply tank8 Produced liquids tank9 Firewater pumps/jacks10 Liquids separator11 Regen cooler/separator12 Dehydration absorbers13 Sewage/potable water14 Control/warehouse15 Instrument air16 Mechanical17 Jetty with pipeline18 Midship Loading Arms19 C36 class CNG ship

17

19

18

1

23

4

56 7

8910

1112

13

1415

16


Jetty discharge facility

1 C36 class CNG ship2 Midship Loading Arms3 Jetty with pipeline4 Inlet separator5 Knockout drum

6 Flare stack

7 Gas compressors8 Coolers9 Fuel gas scrubber

10 Instrument air11 Potable water12 Gas discharge pipeline

1

2

3

45

8

7

6

910

11

12


Offshore loading and discharge equipment options

JETTY

LOADING DISCHARGE

SAL

STL

TANDEM

STL

SAL

SHUTTLE

33CONFIDENTIAL

For more information:

Lyndon Ward - Director of [email protected]

Suite 750, 101-6th Avenue SWCalgary, Alberta, T2P 3P4, Canada

sea-ng.com

Engineering

Sea NG - Small Market Gas Project Development