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LNG as a Marine Fuel – Where Technology Meets Logistics

Rafael Riva Michael Walhof Joshua Sebastian

VP Business Development, Americas Director, Siemens Dresser Rand Engineering Manager, Shearer Group

Agenda

Why LNG Technical

Considerations Procedural

Considerations Logistical Viability

Why LNG – A Compliance Driven Development

Tier II Tier III

Why LNG

Why LNG – A Compliance Driven Development Why LNG

Why LNG – A Compliance Driven Development The Availability Challenge

Why LNG

Commercial

- Competition with land based applications

- Shipping a low volume consumer

- Inconsistency and volatility of prices

Infrastructural

- Bunkering Network

- Bunkering Method

- Consistency in calorific value, the Wobbe Index

Why LNG – A Compliance Driven Development The Availability Challenge

106.3

107.2 103.7

97.5

55.5

65.6 72

77.8 81.2 82.5 80.7 80.4 83

89.3 92.8

50

60

70

80

90

100

110Crude Oil Price $/bbl

Crude oil price prediction

Source: MSI

Gas price differentials

Source: Total

Oil & Gas price prediction

Source: ENN

Why LNG

Why LNG – A Compliance Driven Development A bit of context…

Why LNG

Populating the “Gas Technology Maze” makes

LNG as Fuel a reliable alternative

Technical Considerations

Engine Selection Technical

Considerations

High Pressure GI Low Pressure DF

Characteristics:

*HFO and NG Modes

*Very high pressure

*NOx compliance

requires EGR

Characteristics:

*MDO and NG

Modes

*Low pressure

*All emissions

compliant

Low Pressure,

Slow Speed, HFO,

MGO , MDO and

LNG coming onto

market

The Risk of LNG Bunkering Procedural

Considerations

The Risk of LNG Bunkering Viking Grace – 2 years of Safe Bunkering

Procedural Considerations

LNG Fuelled Vessels – The Radius of Operation LNG as Primary Fuel or LNG as ECA compliance fuel

Vessel Sizes / Rated

Power

Logistical Viability

LNG Fuelled Vessels – The Radius of Operation The LNG Consumption Model:

Inputs

Specific LNG Consumption g/KWh

LNG Density kg / m3

Indicative Vessel Speed knots

Indicative Vessel Power Requirement kW

Typical Routes NM

Max distance between LNG bunker

ports for a typical route

NM

Indicative Vessel Displacement

Volumes

m3

Note: No consideration taken for safety margins, losses to

boil off, or reserve volume required to maintain LNG

temperature

Note: Calculation assumes ME and GE run on LNG

Logistical Viability

𝑇𝑎𝑛𝑘 𝐶𝑎𝑝𝑎𝑐𝑖𝑡𝑦 𝑚3 =

𝐷𝑖𝑠𝑡𝑎𝑛𝑐𝑒 (𝑁𝑀)𝑆𝑝𝑒𝑒𝑑 (𝐾𝑛𝑜𝑡𝑠)

∗ 𝑇𝑜𝑡𝑎𝑙 𝑃𝑜𝑤𝑒𝑟 𝐾𝑊 ∗ %𝑀𝐶𝑅 ∗ 𝑆𝐺𝐶 (𝑔

𝑘𝑊ℎ)

𝐿𝑁𝐺 𝑑𝑒𝑛𝑠𝑖𝑡𝑦 (𝑔𝑚3)

LNG Fuelled Vessels – The Radius of Operation Ports Committing to LNG Bunkering

From LR’s Internal Intelligence Announced in Media

Amsterdam Ferrol Kaohsiung Portsmouth Aarhus Karmøy Santander

Antwerp Foss Latvia Rotterdam Bergen Kristiansund Stavanger

Barcelona Freeport Le Havre Sarnia Bodø Lübeck Talinn

Beaumont Fujairah Lithuania Singapore Buenos Aires Lysekil Turku

Bilbao Galveston Livorno Stockholm Busan Mongstad Wilhelmshaven

Bremerhaven Geismar Long Beach Tilbury Island Florø Nanjing Zhoushan

Brunsbuettel Gijon Los Angeles Trieste Fredrikstad Nynäsham Zwijndrecht

Burga Gothenburg New Orleans Valencia Ghent Oslo

Constanza Gulf of Bothia Piraeus Varna Helsinki Oulu

Copenhagen Hamburg Poland Venice Hirtshals Port Fourchon

Corpus Christi Houston Port Arthur Zeebrugge Incheon Roscoff

Logistical Viability

LNG Fuelled Vessels – The Radius of Operation * Possible Future ECA

Logistical Viability

Vessel: Container Line

Route: South Asia – East Coast USA

Air Emissions Area: NA and C ECA (SOx, NOx), Hong Kong Waters ECA,

Tokyo Bay ECA*, Pearl River Delta*, Malacca Straits*

LNG Bunker Ports: Singapore, Kaohsiung, Shanghai, Busan, LA, Long Beach

LNG Fuelled Vessels – The Radius of Operation * Possible Future ECA

Logistical Viability

Vessel Tank for Full

Voyage (m3)

Tank for ECA

(m3)

6600 TEU 3,700 704

18000 TEU 4,660 890

Vessel: Offshore Support , Tanker and Cruise

Route: Gulf of Mexico

Air Emissions Area: NA and C ECA (SOx and NOx),

Mexico ECA*

LNG Bunker Ports: Houston, Galveston, Freeport, Geismar,

New Orleans, Port Fourchon,

LNG Fuelled Vessels – The Radius of Operation * Possible Future ECA

Logistical Viability

Vessel Tank for Full

Voyage (m3)

Tank for ECA

(m3)

Cruise 3,200 1,600

Aframax 1,114 557

VLCC 1,990 993

Vessel: Tanker / Container Line

Route: North / West Europe – West Coast USA

Air Emissions Area: Baltic and North Sea ECA (SOx),

NA and C ECA (SOx, NOx)

LNG Bunker Ports: Rotterdam, Zeebrugge, Portsmouth,

Le Havre, Bilbao, Farrol, Gijon ,(+)

LNG Fuelled Vessels – The Radius of Operation * Possible Future ECA

Logistical Viability

Vessel Tank for Full

Voyage (m3)

Tank for ECA

(m3)

Aframax 2,000 278

6600 TEU 5,080 704

2016-22-11 Page 19 Walhof / Distributed LNG Solutions

Coastal vs. Inland Development

2016-22-11 Page 20 Walhof / Distributed LNG Solutions

E&P Equipment: Drilling/

Fracturing

• Significant per gallon equivalent fuel

savings to diesel

• High horsepower equipment (>6% of

1800 unit fleet use CNG/LNG)

Mining, Rail, and Marine

• Significant fuel cost savings

• High horsepower equipment (>1,000

gpd per unit typical) (i.e. 700 mining

units in PRB)

Retail/Utility LNG Supply • Low cost, low risk market seeding

• Early cash flow accelerator market

for large scale plants under

construction (30-60 months)

Local, low-cost alternate fuel source for diesel, propane, and heating oil users

Distributed LNG

Demand Side Markets

Typically distanced from large LNG supplies

2016-22-11 Page 21 Walhof / Distributed LNG Solutions

• Modular system converting natural gas to liquefied natural gas

(LNG)

• Micro-scale, point of use

• LNGo LP system – up to 7,000 GPD (11 tpd)

• LNGo HP system – up to 30,000 GPD (48 tpd)

• Re-deployable, skid mounted design with small footprint

• Dresser-Rand and Siemens industry proven technologies and

service

• Liquefaction cycle uses feed gas as fuel*, refrigerant, and

liquefied product * If power module is included.

• Self powered available - easy to permit

LNGo System

Overview

2016-22-11 Page 22 Walhof / Distributed LNG Solutions

LNGo System

Reference List

Item State Country Units / Scope Scope Application Commission date

1 NY USA 1 x LP Demo plant at Dresser-Rand Painted Post facility Demo plant 4Q / 2013

2 BC Canada 1 x HP LNGo systems plus extended scope including building LNG distribution 4Q / 2016

3 PA USA 1 x LP Complete LNGo system Gathering System 2Q / 2016

4 NJ USA 2 x LP Complete LNGo systems Peak shaving 1Q / 2017

5 BC Canada 2 x LP Complete LNGo systems Stranded gas 2017

6 AB Canada 1 x LP Complete LNGo systems Stranded gas 2017

2016-22-11 Page 23 Walhof / Distributed LNG Solutions

LNGo Floating Liquefaction Concept

• 2 x LNGo-HP systems

• ~ 60,000 GPD (96 tpd)

• 2,500 M3 storage

DUAL FUEL INLAND TOWBOAT

Conversion Design for PRINCIPIO

• Maritime Administration (MARAD)

• Pittsburgh Region Clean Cities (PRCC)

• Life Cycle Engineering (LCE)

• The Shearer Group, Inc. (TSGI)

PROJECT OVERVIEW

• Environmental Impacts of Dual Fuel on the inland waterways.

• Small scale consumer

• Use of existing technology and systems.

GAS FUEL STORAGE SYSTEM

• (2) Cryogenic Tanks

• Type C, ASME Boiler & Pressure Vessel Code

BUNKERING SYSTEM