Rationale1 May 2008 Cofinanced by

May 2008RationaleSlide 2 The project MAGALOG Marine Gas Fuel Logistics Liquified Natural Gas (LNG) as a fuel for ships Establishment of LNG supply chains in the Baltic Sea Region

May 2008RationaleSlide 3 The Core Problem in Port Cities Welcome to The Port of Xxxxxxxxx

May 2008RationaleSlide 4 Air pollution from ships in Cities of the Baltic Sea Region (and others)

May 2008RationaleSlide 5 SO 2 -Emissions 80-95% from ships Total 417 t/a

May 2008RationaleSlide 6 NO x -Emissions up to 80% from ships Total 694 t/a

May 2008RationaleSlide 7 Growing ships´ emissions in the EU Source: European Commission land-based sources of air emissions are largely abated land-based sources of air emissions are largely abated but ship emissions are growing but ship emissions are growing

May 2008RationaleSlide 8 Project Objectives A pan-Baltic Sea European project A pan-Baltic Sea European project To overcome the air pollution problem To overcome the air pollution problem To develop supply chains for alternative fuels To develop supply chains for alternative fuels To secure fuel supply To secure fuel supply To further the image of environmentally engaged cities, ports, ship owners To further the image of environmentally engaged cities, ports, ship owners

May 2008RationaleSlide 9 2 LNG-operated offshore supply vessels already in service in Norway

May 2008RationaleSlide 10 New LNG ferry design - Norway 2006

May 2008RationaleSlide 11 6 LNG powered ferries in operation in Norway (2007)

May 2008RationaleSlide 12 Win-win situation Economic benefits Economic benefits Ecologic benefits Ecologic benefits

May 2008RationaleSlide 13 Economic benefits of LNG Lower prices for LNG than for MDO Lower prices for LNG than for MDO Harbour dues reduction in Sweden because of good environmental performance Harbour dues reduction in Sweden because of good environmental performance Selling of NO x at a Norwegian exchange Selling of NO x at a Norwegian exchange Compliance with Marpol Annex VI Compliance with Marpol Annex VI Compliance with the European sulphur fuel directive Compliance with the European sulphur fuel directive Supply security (Gas from Norway) Supply security (Gas from Norway) No investments for particle filters required No investments for particle filters required No investments for catalizers or washing technology required No investments for catalizers or washing technology required Future participation in CO 2 sales (Kyoto mechanism) Future participation in CO 2 sales (Kyoto mechanism)

May 2008RationaleSlide 14 ecologic benefits of LNG 100% less of sulphur dioxides 100% less of sulphur dioxides 100% less particles 100% less particles 80% less carbon hydroxides 80% less carbon hydroxides 70% less nitrogen oxides 70% less nitrogen oxides 50% less carbon monoxides 50% less carbon monoxides 25% less carbon dioxides 25% less carbon dioxides

May 2008RationaleSlide 15 The benefits of project participation Exploration of a new fuel at an early stage Exploration of a new fuel at an early stage Environmental marketing Environmental marketing Taking part in the definition of European policies Taking part in the definition of European policies Prestigious collaboration in a European project Prestigious collaboration in a European project International and national PR International and national PR

May 2008RationaleSlide 16 Activities under the IEE programme Supply chain and market structures for alternative fuels requiring separate supply chains Market demand for alternatively propelled vehicles Accompanying measures

May 2008RationaleSlide 17 LNG Gas Reserve Gas Production & Liquefaction Facilities (Exploration) LNG-Feeder LNG Import & Reception Terminals Exporter Importer LNG Fuel Supply Chain Ro-Ro-Ship

May 2008RationaleSlide 18 Participants 1. Gasnor AS Norway LNG Supplier Project Coordinator 2 Baltic Energy Forum e.V. Germany IEE Energy Agency Assistant Project Coordinator 3 MARINTEK AS Norway Scientific Organization Scientific Counselling 4 Hordaland Oil and Gas Norway Regional Lobby Organization Advisor 5 Stadtwerke Lübeck GmbH Germany Power and Water Uitility of Lübeck Pilot Project in Lübeck 6 Municipality of Swinoujscie Poland Port city Observer

May 2008RationaleSlide 19 Strategic Objectives Workpackages expected Results Establishment of LNG supply chains Project Logic Detailed Objectives Reduction of ship borne Green- house gases and other Emission s WP 3 Common (IEEA) Communic. & Dissemination WP 2 Communication &Dissemination Economic & sustainable operation of LNG powered regularly commuting ships Economic & sustainable operation of LNG powered regularly commuting ships Reduction of ships emissions in cities and on fairways Strategic Objective Establish supply chains for alternativ e fuels (in this project Liquid Natural Gas) Invention of LNG as fuel for ships Public Relations, Presswork, Newsletters Internet-Site Electronic Infos Public Relations, Presswork, Newsletters Internet-Site Electronic Infos © 5/02 STRÄUSSLER Europa & Strategy Consultants, Lübeck, WP 4 Market demand study for LNG powered ships 1 study on possible demand for LNG ships expected Outcomes Economic and techncial proof of viability of LNG supply chains Good Management Documentation 4 Reports Good Management Documentation 4 Reports 2 Conferences 4 Partnership Meetings 2 Conferences 4 Partnership Meetings WP 1 Project Management WP 5 LNG supply chain feasibility studies 1 overall + 6 individual LNG supply chain studies in ports and port cities WP 6 Pilot feasibility study in Lübeck

May 2008RationaleSlide 20 Deliverables 1. Overall supply chain study in the Baltic Sea Region 2. Individual supply chain studies in 6 ports 3. Market demand study for LNG-powered ships 4. Preparation for pilot investments in Lübeck

May 2008RationaleSlide 21 Impacts Contribution to MARPOL Annex VI Contribution to MARPOL Annex VI Contribution to the European fuel directive Contribution to the European fuel directive Contribution to the European clean air directive Contribution to the European clean air directive

May 2008RationaleSlide 22 Target Groups 1. Port Cities 2. Inhabitants and tourists in Port Cities 3. Ship owners and ship operators 4. Energy suppliers and distributors 5. Ship builders and classification bodies 6. European and national bodies 7. The public

May 2008RationaleSlide 23 Project Management Coordinator Gasnor A/S Aksel Skjervheim Assistant coordinator Baltic Energy Forum Jörg Sträussler Gasnor A/S Technical Expertise Baltic Energy Forum Energy Management Hordaland Fylkes- Kommune Stakeholder Marinek Scientific Expertise Municipality of Swinoujscie Stakeholder Power Utlity Lübeck Power Distributor Steering Group Aksel Skjervheim Jörg Sträussler Ralf Giercke

May 2008RationaleSlide 24 Duration From January 1, 2007 From January 1, 2007 Until December 31, 2008 Until December 31, 2008

May 2008RationaleSlide 25 Contact Capt. Jörg Sträussler Baltic Energy Forum e.V. eeee uuuu rrrr oooo pppp rrrr oooo jjjj eeee cccc tttt ssss tttt ---- oooo nnnn llll iiii nnnn eeee.... dddd eeee+49-(0)