DNV GL © 2017 01 April 2018 SAFER, SMARTER, GREENER SUPPLY

MARITIME

LNG regulatory update “Best fuel of the future”, conference & study tour

10 April 2018

[email protected]

Brief status on uptake of LNG as fuel

additional LNG ready ships

500 probably to be reached

110

110 110

in 2020 110

The big wild card: Sulphur 88

105 126

117

124 126 126

122 51

Cap 2020 54

121

121 121

121

121 121

121

119

25 15

Updated 1 April 2018 Excluding LNG carriers and inland waterway vessels

Operating area of the 121 ships in operation Operating area of the 126 ships on order

15 22 38 14

7 1 57 61 14 7 9

Updated 1 April 2018 Excluding LNG carriers and inland waterway vessels

The heat map is based on the LNG fuelled fleet’s AIS positions from 01.01.2018-11.01.2018

LNG uptake by vessel segment

4 3

2 1

Updated 1 April 2018 Excluding LNG carriers and inland waterway vessels

Confirmed orderbook

Year Type of vessel Owner Class Year Type of vessel Owner Class 2018 Tug Drydocks World Tasneef 2018 Container ship Brodosplit DNV GL 2018 Hopper Barge Bremenports DNV GL 2018 Car/passenger ferry Royal Doeksen LR 2018 PSV Harvey Gulf Int. ABS 2018 Car/passenger ferry Royal Doeksen LR 2018 Cable layer DEME Tideway DNV GL 2018 Car/passenger ferry CHFS LR 2018 RoPax Rederi AB Gotland DNV GL 2018 Car/passenger ferry CHFS LR 2018 Container ship Crowley Maritime Corp. DNV GL 2018 RoPax Rederi AB Gotland DNV GL 2018 Container ship Brodosplit DNV GL 2018 Container ship Containerships ABS 2018 Container ship Brodosplit DNV GL 2018 Container ship Containerships ABS 2018 Bulk ship ESL Shipping DNV GL 2018 Container ship GNS Shipping ABS 2018 Bulk ship ESL Shipping DNV GL 2018 Container ship GNS Shipping ABS 2018 Car/passenger ferry Society of Quebec ferries LR 2018 Heavy lift vessel Heerema Offshore LR 2018 Car/passenger ferry Society of Quebec ferries LR 2018 Oil/chemical tanker Furetank Rederi BV 2018 PSV Siem Offshore DNV GL 2018 Oil/chemical tanker Furetank Rederi BV 2018 PSV Siem Offshore DNV GL 2018 Oil/chemical tanker Furetank Rederi BV 2018* HSLC Fred. Olsen DNV GL 2018 Dredger DEME BV 2018* Car/passenger ferry BC ferries ABS 2018 Dredger van der Kamp DNV GL 2018 Car/passenger ferry Caronte & Tourist RINA 2018 Oil/chemical tanker Thun Tankers 2018 Oil/chemical tanker Groupe Desgagnés BV 2018 Oil/chemical tanker SCF DNV GL 2018 Oil/chemical tanker Groupe Desgagnés BV 2018 Oil/chemical tanker SCF DNV GL 2018 Container ship Crowley Maritime Corp. DNV GL 2018 Car/passenger ferry Torghatten DNV GL 2018 Tug Keppel Smit Towage ABS 2018 Bunker ship Harley Marine Services 2018 Tug Maju Maritime ABS 2018 Bunker ship Harley Marine Services 2018* Car/passenger ferry BC ferries ABS 2018 PSV Harvey Gulf Int. ABS 2018 Container ship Brodosplit DNV GL

Updated 1 April 2018 * Conversion project Excluding LNG carriers and inland waterway vessels

Confirmed orderbook

Year Type of vessel Owner Class Year Type of vessel Owner Class 2018 Bunker ship Sinanju Tankers 2019 Emergency response ship German Transport Ministry 2018 Reefer SeOil Agency/Gas Entec 2019 RoPax Brittany Ferries BV 2018 Car/passenger ferry Torghatten DNV GL 2019 RoPax Baleària 2018 Car/passenger ferry Torghatten DNV GL 2019 RoPax Baleària 2018 Car/passenger ferry Torghatten DNV GL 2019 Shuttle tanker AET DNV GL 2018* Dredger Dragages-Ports BV 2019 Shuttle tanker AET DNV GL 2019 Car/passenger ferry Torghatten DNV GL 2019 RoPax Polish Baltic Shipping Co 2019 Oil/chemical tanker Thun Tankers BV 2019 RoPax Polish Baltic Shipping Co 2019 Oil/chemical tanker Thun Tankers BV 2019 Shuttle tanker Teekay Offshore DNV GL 2019 Oil/chemical tanker Thun Tankers BV 2019 Container Ship CMA CGM BV 2019 Oil/chemical tanker SCF DNV GL 2019 Oil/chemical tanker Älvtank BV 2019 Oil/chemical tanker SCF DNV GL 2019 Oil/chemical tanker Älvtank BV 2019 Oil/chemical tanker SCF DNV GL 2019 Tug PSA Marine 2019 Oil/chemical tanker SCF DNV GL 2019 Dredger Dragages Ports 2019 Oil/chemical tanker AET ABS 2019 Fishing vessel Liegruppen 2019 Oil/chemical tanker AET ABS 2020 Wellboat Nordlaks 2019 Tug Mitsui O.S.K. Lines 2020 Container Ship CMA CGM BV 2019 Cruise ship Carnival Corporation RINA 2020 Container Ship CMA CGM BV 2019 Cruise ship Carnival Corporation RINA 2020 Container Ship CMA CGM BV 2019 Oil/chemical tanker Thun Tankers BV 2020 Container Ship CMA CGM BV 2019 Offshore installation ship DEME DNV GL 2020 Container Ship CMA CGM BV 2019 Dredger DEME BV 2020 Shuttle tanker Teekay Offshore DNV GL 2019 RoPax Baleària BV 2020 Shuttle tanker Teekay Offshore DNV GL 2019 Car carrier Siem Car Carriers ABS 2020 Shuttle tanker Teekay Offshore DNV GL 2019 Car carrier Siem Car Carriers ABS 2020 Container ship Pasha Hawaii 2019 Emergency response ship German Transport Ministry 2020 Container ship Pasha Hawaii Updated 1 April 2018 * Conversion project Excluding LNG carriers and inland waterway vessels

Confirmed orderbook

Year Type of vessel Owner Class Year Type of vessel Owner Class 2020 Research ship German Transport Ministry 2020 RoPax Viking Line DNV GL 2020 Cruise ship Carnival Corporation RINA 2020 Cruise ship Carnival Corporation RINA 2020 Container Ship CMA CGM BV 2020 Container Ship CMA CGM BV 2021 Container Ship CMA CGM BV 2021 Oil/chemical tanker Rosneft RR 2021 Oil/chemical tanker Rosneft RR 2021 Oil/chemical tanker Rosneft RR 2021 Oil/chemical tanker Rosneft RR 2021 Oil/chemical tanker Rosneft RR 2021* Ro-Ro TOTE Shipholdings ABS 2021* Ro-Ro TOTE Shipholdings ABS 2021 Cruise ship Carnival Corporation RINA 2021 Cruise ship Carnival Corporation 2021 Cruise ship Disney Cruise Lines 2021 Cruise Ship Ponant BV 2022 Cruise ship Carnival Corporation RINA 2022 Cruise ship MSC Cruises 2022 Cruise ship RCCL DNV GL 2022 Cruise ship Disney Cruise Lines 2022 Cruise ship Carnival Corporation 2023 Cruise ship Disney Cruise Lines 2023 Cruise ship Carnival Corporation 2024 Cruise ship RCCL DNV GL 2024 Cruise ship MSC Cruises Updated 1 April 2018 * Conversion project Excluding LNG carriers and inland waterway vessels

Gas engine technology - ships on order

21% DF 2% Gas Unknown

78%

Updated 1 April 2018 Excluding LNG carriers and inland waterway vessels

Uptake of scrubbers

Scrubber retrofit is the “main competitor” to LNG

*Number of ships are shown. Number of scrubber units are higher. Updated 1 April 2018 Excluding LNG carriers and inland waterway vessels

Some estimates count some

2000 scrubbers by 2020

332 384 429 436

212 284 437

435

*Number of ships are shown. Number of scrubber units are higher. Updated 1 April 2018 Excluding LNG carriers and inland waterway vessels

LNG bunkering infrastructure

38 26

*There may be several bunkering facilities/modes for one location. The count includes local storages, bunker ship loading facilities and truck loading facilities. Locations where LNG fuelled ships can be bunkered by truck or by ship is not counted.

Updated 1 April 2018

4 6 2 6 26

15 6 13 2 5 4 4

Updated 1 April 2018

14 22 20 12

16 8 9 47 43 29 14 2 5 3 Bunker Ship Loading Facility

*Some locations have several types of facilities, which is why the number of facilities is higher than the number of locations.

• Local storage – An intermediary LNG storage

• Tank to ship bunkering – A local storage where an LNG fuelled ship can bunker directly from shore

• Truck loading facility – A terminal where LNG trucks can load LNG (probably under-estimated)

• Bunker Ship loading facility – LNG terminal accessible by small LNG carriers

Updated 1 April 2018

*In the LNGi map bunkering barges for inland waterway vessels are also shown, but these projects are not shown here.

Updated 1 April 2018

LNGi

Heat map Vessel information from AIS plot  Map with LNG bunkering infrastructure

with detailed project data

 Heat map and vessel positions of LNG

fuelled fleet operating area using AIS

 Detailed statistics of LNG fuelled

fleet development

 Scrubber + alternative fuels overview

 LNG related studies and publications

The heat map and vessel positions are based on AIS data from 01.03.2016-11.03.2016

. Brodosplit . Oil major . Carnival Cruises . Oil major . Caterpillar . Port of Amsterdam . CMA Ships . Rolls Royce . ENGIE . SEA\LNG . Galbraith’s Ltd . SGMF . Gas Natural Fenosa . Shell . GTT . Shipowner . Japan Marine Science . Shipowner . MAN . Skangas . Marine Bunker Exchange . UASC . MPA Singapore . Wärtsilä . MST Mineralien Schiffahrt . WinGD . Navig8 . Odfjell

Alternative fuels – where are we heading?

HFO/MGO LNG [PERCENTAG E] Biofuel

LNG Electricity [PERCENTAG E]

DEEP SEA SHORT SEA

9% 18% [PERC 18% ENTAG 50% E]

32% 32%

Regulatory overview

Adopted

Core ports in All ports in Chinese area 0.5% global sulphur Chinese area Chinese area 0.5% sulphur cap 0.5% sulphur 0.5% sulphur

Ballast Water Baltic / North Sea Convention - entry NECA into force

EU CO2 monitoring, Global fuel reporting and consumption data EEDI phase 2 EEDI phase 3 verification collection system

2017 2018 2019 2020 2021-2024 2025-

BC, noise, bio- EEDI phase 3 fouling and VOC regulation

Operational requirements to CO2 emissions

EEDI Phase 4

HK Recycling In the pipeline, or convention ratified?

possible… Additional ECAs established?

. IMO has agreed on amendments and further unified interpretations of the IGF Code Part A-1 for ships using natural gas as fuel.

. A Phase 2 development of the IGF Code is ongoing including more detailed provisions for – Fuel cells and methyl-/ethyl-alcohols as fuel – Finalized 2021 – entry into force 2024

Impact: References: Amendments to the IGF Code subject to approval by MSC99 IGF Code in force from 1 January 2017 for Ships using and adoption by MSC100, Gases or other Low-flashpoint Fuels expected entry into force on 1 January 2024.

. IMO has issued Unified Interpretations of the IGF Code by MSC.1/Circ.1558 . Provides more specific guidance for the application of the relevant requirements in the IGF Code Part A-1 (natural gas). . Unified Interpretations related to:

- Definition of tank connection space and fuel preparation room - Tank connection space may be required on open deck - Appropriate location of premixed engines using fuel gas mixed with air before the turbocharger - Protection against cryogenic leakage and control of hazardous zones in fuel preparation rooms on open deck - External surface area of the tank for determining sizing of pressure relief valve - Control and maintenance of pressure and temperature of liquefied gas fuel tanks after the activation of the safety system - Special consideration within the risk assessment of closed or semi-enclosed bunkering stations - Ventilation of machinery spaces - Ventilation of double piping and gas valve unit spaces in gas safe engine-rooms - Ventilation inlet for double wall piping or duct

DNV GL have considered the areas where the principles of the IGC Code cannot be applied to gas fuelled ships to be of particular importance. The main questions we have asked ourselves are:

• How shall we protect the vessel against leakages in the piping systems? • How shall we reduce the risks associated with having storage tanks located • below deck? • on open deck? • How shall we mitigate the risks associated with a space where liquefied gas is processed, like a fuel preparation room or a tank connection space?

27 DNV GL Rules for gas fuelled ship installations, cont’d

. Pt.6 Ch.2 Sec.5 GAS FUELLED SHIP INSTALLATIONS – GAS FUELLED – Class Notation Gas fuelled – Published October 2015 and entered into force January 2016 – The requirements cover all aspects of the gas fuel installation, from the ship’s gas fuel bunkering connection all the way up to and including all gas consumers

Pt.6 Ch.2 Sec.5 Gas fuelled ship installations - Gas fuelled

1 General requirements 2 Materials 3 Ship arrangement 4 Fuel containment systems 5 Piping systems 6 Ventilation systems 7 Fire safety 8 Electrical systems 9 Control, monitoring and safety systems 10 Gas turbines and boilers 11 Manufacture, workmanship and testing

XN Content Comment GAS D The design for the ship with LNG as fuel is found to be in Mandatory READY compliance with the GAS FUELLED notation rules applicable for the new-building, ref. Pt.1 Ch.1 Sec.2 A300. S Structural reinforcements to support the fuel containment system (LNG fuel tank(s)) are installed, and materials to support the relevant temperatures are used P The ship is prepared for future gas fuel system installations: Pipe routing, structural arrangements for bunkering station, gas valve unit space, fuel preparation space if relevant (optional) MEc Main engine(s) installed can be converted to dual fuel Mandatory (can be replaced with MEi)

MEi Main engine(s) installed can be operated on gas fuel AEc Auxiliary engines installed can be converted to dual fuel The auxiliary engine capacity after conversion shall be sufficient for the ship power balance. AEi Auxiliary engines installed can be operated on gas fuel

B Boilers installed are capable of burning gas fuel

For more information please

Visit: www.dnvgl.com/LNGi Email: [email protected]

www.dnvgl.com

SAFER, SMARTER, GREENER