1. Design & Development of Ocean CNG Transport Systems
Natural Gas Technologies II
Phoenix, Arizona
11 February 2004
Mark Richards Charles White
Gas Technology Institute EnerSea Transport, LLC

2. Overview Why marine transport of CNG? Marine CNG transport benefits
EnerSea’s VOTRANS™ system
Multi-client program validation testing 2

3. EnerSea Transport LLC Based in Houston, Texas Privately owned
Gas transport and storage service provider using
Breakthrough technologies (VOTRANS™)
Experienced team of industry experts
World class partners and business relationships 3

4. Why Marine CNG Transport?
Increased natural gas demand combined with supply constraints have led to growing interest in new sources
Marine CNG transport can address sources beyond the reach of pipelines and below minimum thresholds for LNG/GTL deployment
Production rates between 50 and 700 MMscf per day
Distances between 150 and 3000 miles 4

5. Global Applications The World Needs CNG5

6. Marine CNG Benefits General benefits EnerSea VOTRANS™ benefits
Project capacity scalability
Upward and downward
Project risk mitigation
Investment can be salvaged
LNG complement
Production takeoff during reservoir assessment
Deepwater capability
EnerSea VOTRANS™ benefits
Isothermal, isobaric gas handling accommodates a wide range of gas compositions
Minimal gas processing allows direct loading from offshore production facilities 6

7. EnerSea Transport Scheme
Loading facilities
Proven systems
Dual buoys for continuous production
Vessels designed for submerged turret loading systems
VOTRANS™ vessels
Carrying capacity (up to 1 Bcf)
Approval in Principle (ABS)
Capital and operating costs defined
International vessel design
Delivery terminals - OFFSHORE
Cost effective, safe and secure 7

8. Gas Conditioning and Containment
Gas is loaded and stored at -20°F (or colder)
Increases storage density and reduces material required for containment 8

9. Gas Handling System
Liquid displacement process for loading and unloading
Minimizes heat of compression impact during loading
Minimizes Joule-Thompson effects during unloading
Greatly reduces residual gas volume or “heel”
Provides greater control of unloading rate
Provides a more cost effective containment evacuation
Pump vs. variable suction-head scavenging compressors 9

10. Constructible Design General Arrangement
Gas Volume: 700 – 800 mmscf Length, LOA: m
Beam, B: m
Full load draft 10.1 m
Lightship draft 7.5 m
Ship Speed 18 knots 10

11. CNG vs. LNG Comparative Risk Assessment
Liquefaction
Compression and refrigeration
Loading
Port departure
Buoy departure
Transit
Port arrival
Buoy arrival
Discharging
Regasification
Decompression
CNG and LNG have the same order of risk overall
CNG is found to have a slight risk management advantage, since all risks are offshore 11

12. Pressure Vessel Design Robust and Safe
Reliability pf
ABS Target
EnerSea Tank
Fatigue LS
10-7
7x10-9
Ultimate LS
10-8
4x10-14
DNV Rules for CNG Carriers is 10-5 for an annual target safety value
Design will meet ASME Section VIII Div 3 code
USCG indicates willingness to accept Div 3 code 12

13. VOTRANS™ Technology What is different?
Patented gas storage optimization
Optimize pressures & temperatures
psi (associated or lean gas) compared to psi
Lower weight than competing high pressure steel or steel/fiberglass composite technology
Vessel can be serviced at dry-dock during life
Low cost, widely available materials
High strength carbon steel - no exotic materials
Proven fabrication and construction techniques
Proprietary gas management technology
Isobaric loading minimizes heat of compression effects
Isothermal unloading minimizes JT cooling in storage
Supports rich/associated gas
Unload almost 99% of cargo vs % 13

14. VOTRANS™ Technology Validation Multi-client Programs
NIPPON STEEL
Marine transport of CNG has become a hot topic in the energy industry as a promising way to de-strand valuable gas assets worldwide. Breakthroughs in CNG technology now establish that it is economical and complementary to LNG and pipeline applications.
Our paper describes how the naval architects at Alan C. McClure Associates have worked with Paragon Engineering Services in support of EnerSea’s strategic program to develop the Volume-Optimized Transport and Storage concept. This cooperative effort has mobilized Japan’s K-Line shipping company and Korea’s Hyundai Heavy Industries to generate results that demonstrate CNG is ready for projects. THE PURPOSE OF TODAY’S PRESENTATION is to acquaint you with the overall VOTRANS system, the state of its development and why we believe that the time for CNG is NOW.
I will highlight –
Compelling Reasons for marine transport of CNG
Why EnerSea Transport and VOTRANS™ are leading the energy industry to real CNG projects
How EnerSea’s Maritime Strategy provides a solid basis for current & future project development
Why because of the safety aspects being incorporated, VOTRANS will be approved for international maritime commerce
And
The impact VOTRANS will have on remote and deepwater stranded gas field development 14

15. Validation Testing Functional & Material
Functional testing
Phase 1: complete December 2003
Test program defined
Test set-up designed
Phase 2: Summer 2004
Construct test bed and perform tests
Materials testing
Plate and pipe production
AE systems defined
Test facility selection
Construct full-scale pipe tanks and test 15

16. Creating an Industry CNG Centre of Excellence
World’s first open access, large-scale CNG test facility
Co-funded facility (50%)
C$8.2 million funding
Not-for-profit corporation
Five year program
Process and marine systems
Regulatory forum to coordinate guideline and rule development
El Paso Energy Bridge Test Facility 16

17. Marine CNG Achievements Building Momentum
CNG transport represents an important new gas offtake solution (lean and associated gas)
Technology advancements have greatly increased CNG capabilities & economics
Applications exist for CNG to contribute to the US gas supply
VOTRANS™ is ready for project application 17

18. For Additional Information
Charles N. White
Vice President, Technology
EnerSea Transport LLC
3555 Timmons, Suite 650
Houston, TX USA
Mark E. Richards
Manager, Advanced Energy Systems
Gas Technology Institute
1700 S. Mt. Prospect Rd.
Des Plaines, IL USA 18